<a id="pl.1.3"></a><var>1.3</var>policy, technical, administrative, payment, enforcement, collection, proceeds <br/>
<a id="pl.1.4"></a><var>1.4</var>distribution, refund, and other changes to income, franchise, property, state <br/>
<a id="pl.1.5"></a><var>1.5</var>and local sales and use, motor vehicle sales, minerals, estate, cigarette and <br/>
<a id="pl.1.6"></a><var>1.6</var>tobacco products, gasoline, liquor, insurance premiums, mortgage and deed, <br/>
<a id="pl.1.7"></a><var>1.7</var>healthcare gross revenues, and wheelage taxes, and other taxes and tax-related <br/>
<a id="pl.1.8"></a><var>1.8</var>provisions; conforming to certain changes in the Internal Revenue Code; <br/>
<a id="pl.1.9"></a><var>1.9</var>changing accelerated sales tax payments; providing for licensure of assessors; <br/>
<a id="pl.1.10"></a><var>1.10</var>changing provisions relating to the sustainable forest resource management <br/>
<a id="pl.1.11"></a><var>1.11</var>incentive program; providing for aids to local governments; providing for <br/>
<a id="pl.1.12"></a><var>1.12</var>state debt collection; changing border city allocation, tax increment financing, <br/>
<a id="pl.1.13"></a><var>1.13</var>and economic development, provisions, powers, and incentives; authorizing <br/>
<a id="pl.1.14"></a><var>1.14</var>and providing terms and conditions related to the issuance of obligations and <br/>
<a id="pl.1.15"></a><var>1.15</var>the financing of public improvements and services; changing and imposing <br/>
<a id="pl.1.16"></a><var>1.16</var>powers, duties, and requirements on certain local governments and authorities <br/>
<a id="pl.1.17"></a><var>1.17</var>and on the commissioner of revenue and other state departments and agencies; <br/>
<a id="pl.1.18"></a><var>1.18</var>extending the time for certain publications of notices; requiring notices and <br/>
<a id="pl.1.19"></a><var>1.19</var>publication of information; extending a petrofund fee exemption; providing for <br/>
<a id="pl.1.20"></a><var>1.20</var>purchase of forest lands; authorizing and validating trusts to pay certain public <br/>
<a id="pl.1.21"></a><var>1.21</var>postemployment benefits; providing for iron range higher education grants; <br/>
<a id="pl.1.22"></a><var>1.22</var>changing revenue recapture, local impact notes, and data practices provisions; <br/>
<a id="pl.1.23"></a><var>1.23</var>providing penalties; appropriating money;amending Minnesota Statutes 2006, <br/>
<a id="pl.1.24"></a><var>1.24</var>sections 3.987, subdivision 1; 3.988, subdivision 3; 3.989, subdivisions 2, <br/>
<a id="pl.1.25"></a><var>1.25</var>3; 16A.103, subdivision 2; 16D.04, subdivisions 1, 2; 16D.11, subdivisions <br/>
<a id="pl.1.26"></a><var>1.26</var>2, 7; 62I.06, subdivision 6; 71A.04, subdivision 1; 97A.061, subdivision 2; <br/>
<a id="pl.1.27"></a><var>1.27</var>118A.03, subdivision 3; 123B.61; 127A.48, subdivision 2; 270.071, subdivision <br/>
<a id="pl.1.28"></a><var>1.28</var>7; 270.072, subdivisions 2, 3, 6; 270.074, subdivision 3; 270.076, subdivision <br/>
<a id="pl.1.29"></a><var>1.29</var>1; 270.41, subdivisions 1, 2, 3, 5, by adding a subdivision; 270.44; 270.45; <br/>
<a id="pl.1.30"></a><var>1.30</var>270.46; 270.47; 270.48; 270.50; 270A.03, subdivision 2; 270A.10; 270C.306; <br/>
<a id="pl.1.31"></a><var>1.31</var>270C.34, subdivision 1; 270C.446, subdivision 2; 270C.56, subdivision 1; <br/>
<a id="pl.1.32"></a><var>1.32</var>270C.63, subdivision 9; 272.02, by adding subdivisions; 272.115, subdivision <br/>
<a id="pl.1.33"></a><var>1.33</var>1; 273.05, by adding a subdivision; 273.111, subdivision 3; 273.117; 273.121; <br/>
<a id="pl.1.34"></a><var>1.34</var>273.124, subdivision 13, by adding a subdivision; 273.125, subdivision 8; <br/>
<a id="pl.1.35"></a><var>1.35</var>273.128, subdivision 1; 273.13, subdivisions 22, 23, 25, by adding a subdivision; <br/>
<a id="pl.1.36"></a><var>1.36</var>273.1315; 273.1398, subdivision 4; 273.33, subdivision 2; 273.37, subdivision 2; <br/>
<a id="pl.1.37"></a><var>1.37</var>273.371, subdivision 1; 274.01, subdivision 1; 274.13, subdivision 1; 275.025, <br/>
<a id="pl.1.38"></a><var>1.38</var>subdivision 3; 275.065, subdivision 5a, by adding a subdivision; 275.066; <br/>
<a id="pl.1.39"></a><var>1.39</var>275.067; 275.61, subdivision 1; 276.04, subdivision 2, by adding a subdivision; <br/>
<a id="pl.2.1"></a><var>2.1</var>276A.01, subdivision 3; 276A.04; 277.01, subdivision 2; 278.05, subdivision <br/>
<a id="pl.2.2"></a><var>2.2</var>6; 279.01, subdivision 1; 279.37, subdivision 1a; 280.39; 287.22; 287.2205; <br/>
<a id="pl.2.3"></a><var>2.3</var>289A.02, subdivision 7; 289A.08, subdivision 11; 289A.09, subdivision 2; <br/>
<a id="pl.2.4"></a><var>2.4</var>289A.12, subdivisions 4, 14; 289A.18, subdivision 1; 289A.20, subdivision <br/>
<a id="pl.2.5"></a><var>2.5</var>4; 289A.38, subdivision 7; 289A.40, subdivision 2; 289A.56, by adding a <br/>
<a id="pl.2.6"></a><var>2.6</var>subdivision; 289A.60, subdivisions 8, 12, 15, 25, 27, by adding subdivisions; <br/>
<a id="pl.2.7"></a><var>2.7</var>290.01, subdivisions 19a, 19c, 19d; 290.06, subdivisions 2c, 33; 290.067, <br/>
<a id="pl.2.8"></a><var>2.8</var>subdivision 2b; 290.0671, subdivision 7; 290.0677, subdivision 1; 290.091, <br/>
<a id="pl.2.9"></a><var>2.9</var>subdivisions 2, 3; 290.0921, subdivision 3; 290.10; 290.17, subdivision 2; <br/>
<a id="pl.2.10"></a><var>2.10</var>290.191, subdivision 8; 290.92, by adding a subdivision; 290A.03, subdivision 7; <br/>
<a id="pl.2.11"></a><var>2.11</var>290B.03, subdivision 2; 290C.02, subdivision 3; 290C.04; 290C.05; 290C.07; <br/>
<a id="pl.2.12"></a><var>2.12</var>290C.11; 291.005, subdivision 1; 291.215, subdivision 1; 295.52, subdivisions <br/>
<a id="pl.2.13"></a><var>2.13</var>4, 4a; 295.54, subdivision 2; 296A.18, subdivision 4; 297A.61, subdivisions <br/>
<a id="pl.2.14"></a><var>2.14</var>3, 4, 7, 10, 24, by adding subdivisions; 297A.63, subdivision 1; 297A.665; <br/>
<a id="pl.2.15"></a><var>2.15</var>297A.668, by adding a subdivision; 297A.669, subdivisions 3, 13, 14, by adding <br/>
<a id="pl.2.16"></a><var>2.16</var>subdivisions; 297A.67, subdivisions 7, 8, 9; 297A.68, subdivisions 11, 16, <br/>
<a id="pl.2.17"></a><var>2.17</var>35; 297A.69, subdivision 2; 297A.70, subdivision 7, by adding a subdivision; <br/>
<a id="pl.2.18"></a><var>2.18</var>297A.72; 297A.90, subdivision 2; 297B.035, subdivision 1; 297F.06, subdivision <br/>
<a id="pl.2.19"></a><var>2.19</var>4; 297F.09, subdivision 10; 297F.21, subdivision 3; 297F.25, by adding a <br/>
<a id="pl.2.20"></a><var>2.20</var>subdivision; 297G.09, subdivision 9; 297I.06, subdivisions 1, 2; 297I.15, by <br/>
<a id="pl.2.21"></a><var>2.21</var>adding a subdivision; 297I.20, subdivision 2; 297I.40, subdivision 5; 298.22, by <br/>
<a id="pl.2.22"></a><var>2.22</var>adding a subdivision; 298.2214, subdivision 2; 298.24, subdivision 1; 298.25; <br/>
<a id="pl.2.23"></a><var>2.23</var>298.28, subdivisions 4, 5, by adding a subdivision; 298.282, subdivision 1; <br/>
<a id="pl.2.24"></a><var>2.24</var>298.292, subdivision 2; 298.296, subdivision 2; 298.2961, subdivisions 4, 5; <br/>
<a id="pl.2.25"></a><var>2.25</var>298.75, subdivisions 1, 3, 7, by adding a subdivision; 331A.05, subdivision <br/>
<a id="pl.2.26"></a><var>2.26</var>2; 360.031; 365A.02; 365A.04; 365A.08; 365A.095; 373.01, subdivision 3; <br/>
<a id="pl.2.27"></a><var>2.27</var>373.40, subdivision 4; 375B.09; 383B.117, subdivision 2; 383B.77, subdivisions <br/>
<a id="pl.2.28"></a><var>2.28</var>1, 2; 410.32; 412.301; 435.193; 453A.02, subdivision 3; 469.169, by adding a <br/>
<a id="pl.2.29"></a><var>2.29</var>subdivision; 469.1734, subdivision 6; 469.174, subdivisions 10, 10a; 469.175, <br/>
<a id="pl.2.30"></a><var>2.30</var>subdivisions 1, 3; 469.176, subdivisions 1, 2, 4l, 7; 469.1761, subdivision <br/>
<a id="pl.2.31"></a><var>2.31</var>1; 469.1763, subdivision 2; 469.177, subdivision 1; 469.178, subdivision 7; <br/>
<a id="pl.2.32"></a><var>2.32</var>469.1791, subdivision 3; 473.39, by adding subdivisions; 475.51, subdivision <br/>
<a id="pl.2.33"></a><var>2.33</var>4; 475.52, subdivision 6; 475.53, subdivision 1; 475.58, subdivisions 1, 3b; <br/>
<a id="pl.2.34"></a><var>2.34</var>477A.011, subdivision 36; 477A.013, subdivisions 8, 9; Minnesota Statutes <br/>
<a id="pl.2.35"></a><var>2.35</var>2007 Supplement, sections 270A.03, subdivision 5; 272.02, subdivision 64; <br/>
<a id="pl.2.36"></a><var>2.36</var>273.124, subdivision 14; 275.065, subdivision 3; 290.01, subdivisions 19, 19b, <br/>
<a id="pl.2.37"></a><var>2.37</var>31; 290A.03, subdivision 15; 424A.10, subdivision 3; Laws 1973, chapter 393, <br/>
<a id="pl.2.38"></a><var>2.38</var>section 1, as amended; Laws 1980, chapter 511, section 1, subdivision 2, as <br/>
<a id="pl.2.39"></a><var>2.39</var>amended; Laws 1988, chapter 645, section 3, as amended; Laws 1989, chapter <br/>
<a id="pl.2.40"></a><var>2.40</var>211, section 8, subdivision 4, as amended; Laws 1994, chapter 587, article 9, <br/>
<a id="pl.2.41"></a><var>2.41</var>section 14, subdivisions 1, 2, 3; Laws 1995, chapter 264, article 5, sections 44, <br/>
<a id="pl.2.42"></a><var>2.42</var>subdivision 4, as amended; 45, subdivision 1, as amended; Laws 2003, chapter <br/>
<a id="pl.2.43"></a><var>2.43</var>128, article 1, section 172, as amended; Laws 2005, First Special Session chapter <br/>
<a id="pl.2.44"></a><var>2.44</var>3, article 5, section 39; article 10, section 23, as amended; Laws 2006, chapter <br/>
<a id="pl.2.45"></a><var>2.45</var>259, article 11, section 3; proposing coding for new law in Minnesota Statutes, <br/>
<a id="pl.2.46"></a><var>2.46</var>chapters 270; 270C; 273; 274; 290C; 297A; 360; 471; 475; repealing Minnesota <br/>
<a id="pl.2.47"></a><var>2.47</var>Statutes 2006, sections 16A.1522; 163.051, subdivision 5; 270.073; 270.41, <br/>
<a id="pl.2.48"></a><var>2.48</var>subdivision 4; 270.43; 270.51; 270.52; 270.53; 295.60; 297A.61, subdivision <br/>
<a id="pl.2.49"></a><var>2.49</var>20; 297A.668, subdivision 6; 297A.67, subdivision 22; 469.174, subdivision 29; <br/>
<a id="pl.2.50"></a><var>2.50</var>Laws 1973, chapter 393, section 2; Laws 1994, chapter 587, article 9, section 8, <br/>
<a id="pl.2.51"></a><var>2.51</var>subdivision 1, as amended; Laws 1998, chapter 389, article 11, section 18.<br/>
<a id="pl.2.52"></a><var>2.52</var>BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:<br/>
<br/>
<a id="bill.1.0.0"></a>

<a id="bill.1.1.0"></a><a id="pl.3.3"></a><var>3.3</var>    Section 1. Minnesota Statutes 2006, section 477A.011, subdivision 36, is amended to <br/>
<a id="pl.3.4"></a><var>3.4</var>read:<br/>
<a id="pl.3.5"></a><var>3.5</var>    Subd. 36. <b>City aid base.</b> (a) Except as otherwise provided in this subdivision, <br/>
<a id="pl.3.6"></a><var>3.6</var>"city aid base" is zero.<br/>
<a id="pl.3.7"></a><var>3.7</var>    (b) The city aid base for any city with a population less than 500 is increased by <br/>
<a id="pl.3.8"></a><var>3.8</var>$40,000 for aids payable in calendar year 1995 and thereafter, and the maximum amount <br/>
<a id="pl.3.9"></a><var>3.9</var>of total aid it may receive under section 
         <statute_ref>477A.013, subdivision 9</statute_ref>, paragraph (c), is also <br/>
<a id="pl.3.10"></a><var>3.10</var>increased by $40,000 for aids payable in calendar year 1995 only, provided that:<br/>
<a id="pl.3.11"></a><var>3.11</var>    (i) the average total tax capacity rate for taxes payable in 1995 exceeds 200 percent;<br/>
<a id="pl.3.12"></a><var>3.12</var>    (ii) the city portion of the tax capacity rate exceeds 100 percent; and<br/>
<a id="pl.3.13"></a><var>3.13</var>    (iii) its city aid base is less than $60 per capita.<br/>
<a id="pl.3.14"></a><var>3.14</var>    (c) The city aid base for a city is increased by $20,000 in 1998 and thereafter and <br/>
<a id="pl.3.15"></a><var>3.15</var>the maximum amount of total aid it may receive under section 
         <statute_ref>477A.013, subdivision 9</statute_ref>, <br/>
<a id="pl.3.16"></a><var>3.16</var>paragraph (c), is also increased by $20,000 in calendar year 1998 only, provided that:<br/>
<a id="pl.3.17"></a><var>3.17</var>    (i) the city has a population in 1994 of 2,500 or more;<br/>
<a id="pl.3.18"></a><var>3.18</var>    (ii) the city is located in a county, outside of the metropolitan area, which contains a <br/>
<a id="pl.3.19"></a><var>3.19</var>city of the first class;<br/>
<a id="pl.3.20"></a><var>3.20</var>    (iii) the city's net tax capacity used in calculating its 1996 aid under section <br/>
<statute_ref><a id="pl.3.21"></a><var>3.21</var>477A.013
         </statute_ref> is less than $400 per capita; and<br/>
<a id="pl.3.22"></a><var>3.22</var>    (iv) at least four percent of the total net tax capacity, for taxes payable in 1996, of <br/>
<a id="pl.3.23"></a><var>3.23</var>property located in the city is classified as railroad property.<br/>
<a id="pl.3.24"></a><var>3.24</var>    (d) The city aid base for a city is increased by $200,000 in 1999 and thereafter and <br/>
<a id="pl.3.25"></a><var>3.25</var>the maximum amount of total aid it may receive under section 
         <statute_ref>477A.013, subdivision 9</statute_ref>, <br/>
<a id="pl.3.26"></a><var>3.26</var>paragraph (c), is also increased by $200,000 in calendar year 1999 only, provided that:<br/>
<a id="pl.3.27"></a><var>3.27</var>    (i) the city was incorporated as a statutory city after December 1, 1993;<br/>
<a id="pl.3.28"></a><var>3.28</var>    (ii) its city aid base does not exceed $5,600; and<br/>
<a id="pl.3.29"></a><var>3.29</var>    (iii) the city had a population in 1996 of 5,000 or more.<br/>
<a id="pl.3.30"></a><var>3.30</var>    (e) The city aid base for a city is increased by $450,000 in 1999 to 2008 and the <br/>
<a id="pl.3.31"></a><var>3.31</var>maximum amount of total aid it may receive under section 
         <statute_ref>477A.013, subdivision 9</statute_ref>, <br/>
<a id="pl.3.32"></a><var>3.32</var>paragraph (c), is also increased by $450,000 in calendar year 1999 only, provided that:<br/>
<a id="pl.3.33"></a><var>3.33</var>    (i) the city had a population in 1996 of at least 50,000;<br/>
<a id="pl.3.34"></a><var>3.34</var>    (ii) its population had increased by at least 40 percent in the ten-year period ending <br/>
<a id="pl.3.35"></a><var>3.35</var>in 1996; and<br/>
<a id="pl.4.1"></a><var>4.1</var>    (iii) its city's net tax capacity for aids payable in 1998 is less than $700 per capita.<br/>
<a id="pl.4.2"></a><var>4.2</var>    (f) The city aid base for a city is increased by $150,000 for aids payable in 2000 and <br/>
<a id="pl.4.3"></a><var>4.3</var>thereafter, and the maximum amount of total aid it may receive under section 
         <statute_ref>477A.013, <br/>
<a id="pl.4.4"></a><var>4.4</var>subdivision 9
         </statute_ref>, paragraph (c), is also increased by $150,000 in calendar year 2000 only, <br/>
<a id="pl.4.5"></a><var>4.5</var>provided that:<br/>
<a id="pl.4.6"></a><var>4.6</var>    (1) the city has a population that is greater than 1,000 and less than 2,500;<br/>
<a id="pl.4.7"></a><var>4.7</var>    (2) its commercial and industrial percentage for aids payable in 1999 is greater <br/>
<a id="pl.4.8"></a><var>4.8</var>than 45 percent; and<br/>
<a id="pl.4.9"></a><var>4.9</var>    (3) the total market value of all commercial and industrial property in the city <br/>
<a id="pl.4.10"></a><var>4.10</var>for assessment year 1999 is at least 15 percent less than the total market value of all <br/>
<a id="pl.4.11"></a><var>4.11</var>commercial and industrial property in the city for assessment year 1998.<br/>
<a id="pl.4.12"></a><var>4.12</var>    (g) The city aid base for a city is increased by $200,000 in 2000 and thereafter, and <br/>
<a id="pl.4.13"></a><var>4.13</var>the maximum amount of total aid it may receive under section 
         <statute_ref>477A.013, subdivision 9</statute_ref>, <br/>
<a id="pl.4.14"></a><var>4.14</var>paragraph (c), is also increased by $200,000 in calendar year 2000 only, provided that:<br/>
<a id="pl.4.15"></a><var>4.15</var>    (1) the city had a population in 1997 of 2,500 or more;<br/>
<a id="pl.4.16"></a><var>4.16</var>    (2) the net tax capacity of the city used in calculating its 1999 aid under section <br/>
<statute_ref><a id="pl.4.17"></a><var>4.17</var>477A.013
         </statute_ref> is less than $650 per capita;<br/>
<a id="pl.4.18"></a><var>4.18</var>    (3) the pre-1940 housing percentage of the city used in calculating 1999 aid under <br/>
<a id="pl.4.19"></a><var>4.19</var>section 
         <statute_ref>477A.013</statute_ref> is greater than 12 percent;<br/>
<a id="pl.4.20"></a><var>4.20</var>    (4) the 1999 local government aid of the city under section 
         <statute_ref>477A.013</statute_ref> is less than <br/>
<a id="pl.4.21"></a><var>4.21</var>20 percent of the amount that the formula aid of the city would have been if the need <br/>
<a id="pl.4.22"></a><var>4.22</var>increase percentage was 100 percent; and<br/>
<a id="pl.4.23"></a><var>4.23</var>    (5) the city aid base of the city used in calculating aid under section 
         <statute_ref>477A.013</statute_ref> <br/>
<a id="pl.4.24"></a><var>4.24</var>is less than $7 per capita.<br/>
<a id="pl.4.25"></a><var>4.25</var>    (h) The city aid base for a city is increased by $102,000 in 2000 and thereafter, and <br/>
<a id="pl.4.26"></a><var>4.26</var>the maximum amount of total aid it may receive under section 
         <statute_ref>477A.013, subdivision 9</statute_ref>, <br/>
<a id="pl.4.27"></a><var>4.27</var>paragraph (c), is also increased by $102,000 in calendar year 2000 only, provided that:<br/>
<a id="pl.4.28"></a><var>4.28</var>    (1) the city has a population in 1997 of 2,000 or more;<br/>
<a id="pl.4.29"></a><var>4.29</var>    (2) the net tax capacity of the city used in calculating its 1999 aid under section <br/>
<statute_ref><a id="pl.4.30"></a><var>4.30</var>477A.013
         </statute_ref> is less than $455 per capita;<br/>
<a id="pl.4.31"></a><var>4.31</var>    (3) the net levy of the city used in calculating 1999 aid under section 
         <statute_ref>477A.013</statute_ref> is <br/>
<a id="pl.4.32"></a><var>4.32</var>greater than $195 per capita; and<br/>
<a id="pl.4.33"></a><var>4.33</var>    (4) the 1999 local government aid of the city under section 
         <statute_ref>477A.013</statute_ref> is less than <br/>
<a id="pl.4.34"></a><var>4.34</var>38 percent of the amount that the formula aid of the city would have been if the need <br/>
<a id="pl.4.35"></a><var>4.35</var>increase percentage was 100 percent.<br/>
<a id="pl.5.1"></a><var>5.1</var>    (i) The city aid base for a city is increased by $32,000 in 2001 and thereafter, and <br/>
<a id="pl.5.2"></a><var>5.2</var>the maximum amount of total aid it may receive under section 
         <statute_ref>477A.013, subdivision 9</statute_ref>, <br/>
<a id="pl.5.3"></a><var>5.3</var>paragraph (c), is also increased by $32,000 in calendar year 2001 only, provided that:<br/>
<a id="pl.5.4"></a><var>5.4</var>    (1) the city has a population in 1998 that is greater than 200 but less than 500;<br/>
<a id="pl.5.5"></a><var>5.5</var>    (2) the city's revenue need used in calculating aids payable in 2000 was greater <br/>
<a id="pl.5.6"></a><var>5.6</var>than $200 per capita;<br/>
<a id="pl.5.7"></a><var>5.7</var>    (3) the city net tax capacity for the city used in calculating aids available in 2000 <br/>
<a id="pl.5.8"></a><var>5.8</var>was equal to or less than $200 per capita;<br/>
<a id="pl.5.9"></a><var>5.9</var>    (4) the city aid base of the city used in calculating aid under section 
         <statute_ref>477A.013</statute_ref> <br/>
<a id="pl.5.10"></a><var>5.10</var>is less than $65 per capita; and<br/>
<a id="pl.5.11"></a><var>5.11</var>    (5) the city's formula aid for aids payable in 2000 was greater than zero.<br/>
<a id="pl.5.12"></a><var>5.12</var>    (j) The city aid base for a city is increased by $7,200 in 2001 and thereafter, and <br/>
<a id="pl.5.13"></a><var>5.13</var>the maximum amount of total aid it may receive under section 
         <statute_ref>477A.013, subdivision 9</statute_ref>, <br/>
<a id="pl.5.14"></a><var>5.14</var>paragraph (c), is also increased by $7,200 in calendar year 2001 only, provided that:<br/>
<a id="pl.5.15"></a><var>5.15</var>    (1) the city had a population in 1998 that is greater than 200 but less than 500;<br/>
<a id="pl.5.16"></a><var>5.16</var>    (2) the city's commercial industrial percentage used in calculating aids payable in <br/>
<a id="pl.5.17"></a><var>5.17</var>2000 was less than ten percent;<br/>
<a id="pl.5.18"></a><var>5.18</var>    (3) more than 25 percent of the city's population was 60 years old or older according <br/>
<a id="pl.5.19"></a><var>5.19</var>to the 1990 census;<br/>
<a id="pl.5.20"></a><var>5.20</var>    (4) the city aid base of the city used in calculating aid under section 
         <statute_ref>477A.013</statute_ref> <br/>
<a id="pl.5.21"></a><var>5.21</var>is less than $15 per capita; and<br/>
<a id="pl.5.22"></a><var>5.22</var>    (5) the city's formula aid for aids payable in 2000 was greater than zero.<br/>
<a id="pl.5.23"></a><var>5.23</var>    (k) The city aid base for a city is increased by $45,000 in 2001 and thereafter and <br/>
<a id="pl.5.24"></a><var>5.24</var>by an additional $50,000 in calendar years 2002 to 2011, and the maximum amount of <br/>
<a id="pl.5.25"></a><var>5.25</var>total aid it may receive under section 
         <statute_ref>477A.013, subdivision 9</statute_ref>, paragraph (c), is also <br/>
<a id="pl.5.26"></a><var>5.26</var>increased by $45,000 in calendar year 2001 only, and by $50,000 in calendar year 2002 <br/>
<a id="pl.5.27"></a><var>5.27</var>only, provided that:<br/>
<a id="pl.5.28"></a><var>5.28</var>    (1) the net tax capacity of the city used in calculating its 2000 aid under section <br/>
<statute_ref><a id="pl.5.29"></a><var>5.29</var>477A.013
         </statute_ref> is less than $810 per capita;<br/>
<a id="pl.5.30"></a><var>5.30</var>    (2) the population of the city declined more than two percent between 1988 and 1998;<br/>
<a id="pl.5.31"></a><var>5.31</var>    (3) the net levy of the city used in calculating 2000 aid under section 
         <statute_ref>477A.013</statute_ref> is <br/>
<a id="pl.5.32"></a><var>5.32</var>greater than $240 per capita; and<br/>
<a id="pl.5.33"></a><var>5.33</var>    (4) the city received less than $36 per capita in aid under section 
         <statute_ref>477A.013, <br/>
<a id="pl.5.34"></a><var>5.34</var>subdivision 9
         </statute_ref>, for aids payable in 2000.<br/>
<a id="pl.5.35"></a><var>5.35</var>    (l) The city aid base for a city with a population of 10,000 or more which is located <br/>
<a id="pl.5.36"></a><var>5.36</var>outside of the seven-county metropolitan area is increased in 2002 and thereafter, and the <br/>
<a id="pl.6.1"></a><var>6.1</var>maximum amount of total aid it may receive under section 
         <statute_ref>477A.013, subdivision 9</statute_ref>, <br/>
<a id="pl.6.2"></a><var>6.2</var>paragraph (b) or (c), is also increased in calendar year 2002 only, by an amount equal to <br/>
<a id="pl.6.3"></a><var>6.3</var>the lesser of:<br/>
<a id="pl.6.4"></a><var>6.4</var>    (1)(i) the total population of the city, as determined by the United States Bureau of <br/>
<a id="pl.6.5"></a><var>6.5</var>the Census, in the 2000 census, (ii) minus 5,000, (iii) times 60; or<br/>
<a id="pl.6.6"></a><var>6.6</var>    (2) $2,500,000.<br/>
<a id="pl.6.7"></a><var>6.7</var>    (m) The city aid base is increased by $50,000 in 2002 and thereafter, and the <br/>
<a id="pl.6.8"></a><var>6.8</var>maximum amount of total aid it may receive under section 
         <statute_ref>477A.013, subdivision 9</statute_ref>, <br/>
<a id="pl.6.9"></a><var>6.9</var>paragraph (c), is also increased by $50,000 in calendar year 2002 only, provided that:<br/>
<a id="pl.6.10"></a><var>6.10</var>    (1) the city is located in the seven-county metropolitan area;<br/>
<a id="pl.6.11"></a><var>6.11</var>    (2) its population in 2000 is between 10,000 and 20,000; and<br/>
<a id="pl.6.12"></a><var>6.12</var>    (3) its commercial industrial percentage, as calculated for city aid payable in 2001, <br/>
<a id="pl.6.13"></a><var>6.13</var>was greater than 25 percent.<br/>
<a id="pl.6.14"></a><var>6.14</var>    (n) The city aid base for a city is increased by $150,000 in calendar years 2002 to <br/>
<a id="pl.6.15"></a><var>6.15</var>2011 and by an additional $75,000 in calendar years 2009 to 2014 and the maximum <br/>
<a id="pl.6.16"></a><var>6.16</var>amount of total aid it may receive under section 
         <statute_ref>477A.013, subdivision 9</statute_ref>, paragraph (c), is <br/>
<a id="pl.6.17"></a><var>6.17</var>also increased by $150,000 in calendar year 2002 only and by $75,000 in calendar year <br/>
<a id="pl.6.18"></a><var>6.18</var>2009 only, provided that:<br/>
<a id="pl.6.19"></a><var>6.19</var>    (1) the city had a population of at least 3,000 but no more than 4,000 in 1999;<br/>
<a id="pl.6.20"></a><var>6.20</var>    (2) its home county is located within the seven-county metropolitan area;<br/>
<a id="pl.6.21"></a><var>6.21</var>    (3) its pre-1940 housing percentage is less than 15 percent; and<br/>
<a id="pl.6.22"></a><var>6.22</var>    (4) its city net tax capacity per capita for taxes payable in 2000 is less than $900 <br/>
<a id="pl.6.23"></a><var>6.23</var>per capita.<br/>
<a id="pl.6.24"></a><var>6.24</var>    (o) The city aid base for a city is increased by $200,000 beginning in calendar <br/>
<a id="pl.6.25"></a><var>6.25</var>year 2003 and the maximum amount of total aid it may receive under section 
         <statute_ref>477A.013, <br/>
<a id="pl.6.26"></a><var>6.26</var>subdivision 9
         </statute_ref>, paragraph (c), is also increased by $200,000 in calendar year 2003 only, <br/>
<a id="pl.6.27"></a><var>6.27</var>provided that the city qualified for an increase in homestead and agricultural credit aid <br/>
<a id="pl.6.28"></a><var>6.28</var>under Laws 1995, chapter 264, article 8, section 18.<br/>
<a id="pl.6.29"></a><var>6.29</var>    (p) The city aid base for a city is increased by $200,000 in 2004 only and the <br/>
<a id="pl.6.30"></a><var>6.30</var>maximum amount of total aid it may receive under section 
         <statute_ref>477A.013, subdivision 9</statute_ref>, is <br/>
<a id="pl.6.31"></a><var>6.31</var>also increased by $200,000 in calendar year 2004 only, if the city is the site of a nuclear <br/>
<a id="pl.6.32"></a><var>6.32</var>dry cask storage facility.<br/>
<a id="pl.6.33"></a><var>6.33</var>    (q) The city aid base for a city is increased by $10,000 in 2004 and thereafter and the <br/>
<a id="pl.6.34"></a><var>6.34</var>maximum total aid it may receive under section 
         <statute_ref>477A.013, subdivision 9</statute_ref>, is also increased <br/>
<a id="pl.6.35"></a><var>6.35</var>by $10,000 in calendar year 2004 only, if the city was included in a federal major disaster <br/>
<a id="pl.7.1"></a><var>7.1</var>designation issued on April 1, 1998, and its pre-1940 housing stock was decreased by <br/>
<a id="pl.7.2"></a><var>7.2</var>more than 40 percent between 1990 and 2000.<br/>
<a id="pl.7.3"></a><var>7.3</var>    (r) The city aid base for a city is increased by $25,000 $30,000  in 2006 only <br/>
<a id="pl.7.4"></a><var>7.4</var>2009 and thereafter  and the maximum total aid it may receive under section 
         <statute_ref>477A.013, <br/>
<a id="pl.7.5"></a><var>7.5</var>subdivision 9
         </statute_ref>, is also increased by $25,000 in calendar year 2006 only if the city had a <br/>
<a id="pl.7.6"></a><var>7.6</var>population in 2003 of at least 1,000 and has a state park for which the city provides rescue <br/>
<a id="pl.7.7"></a><var>7.7</var>services and which comprised at least 14 percent of the total geographic area included <br/>
<a id="pl.7.8"></a><var>7.8</var>within the city boundaries in 2000.<br/>
<a id="pl.7.9"></a><var>7.9</var>    (s) The city aid base for a city with a population less than 5,000 is increased in <br/>
<a id="pl.7.10"></a><var>7.10</var>2006 and thereafter and the minimum and maximum amount of total aid it may receive <br/>
<a id="pl.7.11"></a><var>7.11</var>under this section is also increased in calendar year 2006 only by an amount equal to <br/>
<a id="pl.7.12"></a><var>7.12</var>$6 multiplied by its population.<br/>
<a id="pl.7.13"></a><var>7.13</var>    (t) The city aid base for a city is increased by $80,000 in 2007 only 2009 and <br/>
<a id="pl.7.14"></a><var>7.14</var>thereafter and the minimum and maximum amount of total aid it may receive under section <br/>
<statute_ref><a id="pl.7.15"></a><var>7.15</var>477A.013
         </statute_ref>, subdivision 9, is also increased by $80,000 in calendar year 2007 2009 only, if:<br/>
<a id="pl.7.16"></a><var>7.16</var>    (1) as of May 1, 2006, at least 25 percent of the tax capacity of the city is proposed <br/>
<a id="pl.7.17"></a><var>7.17</var>to be placed in trust status as tax-exempt Indian land;<br/>
<a id="pl.7.18"></a><var>7.18</var>    (2) the placement of the land is being challenged administratively or in court; and <br/>
<a id="pl.7.19"></a><var>7.19</var>    (3) due to the challenge, the land proposed to be placed in trust is still on the tax <br/>
<a id="pl.7.20"></a><var>7.20</var>rolls as of May 1, 2006.<br/>
<a id="pl.7.21"></a><var>7.21</var>    (u) The city aid base for a city is increased by $100,000 in 2007 and thereafter and <br/>
<a id="pl.7.22"></a><var>7.22</var>the minimum and maximum total amount of aid it may receive under this section is also <br/>
<a id="pl.7.23"></a><var>7.23</var>increased in calendar year 2007 only, provided that:<br/>
<a id="pl.7.24"></a><var>7.24</var>    (1) the city has a 2004 estimated population greater than 200 but less than 2,000;<br/>
<a id="pl.7.25"></a><var>7.25</var>    (2) its city net tax capacity for aids payable in 2006 was less than $300 per capita;<br/>
<a id="pl.7.26"></a><var>7.26</var>    (3) the ratio of its pay 2005 tax levy compared to its city net tax capacity for aids <br/>
<a id="pl.7.27"></a><var>7.27</var>payable in 2006 was greater than 110 percent; and<br/>
<a id="pl.7.28"></a><var>7.28</var>    (4) it is located in a county where at least 15,000 acres of land are classified as <br/>
<a id="pl.7.29"></a><var>7.29</var>tax-exempt Indian reservations according to the 2004 abstract of tax-exempt property.<br/>
<a id="pl.7.30"></a><var>7.30</var>    (v) The city aid base for a city is increased by $30,000 in 2009 only, and the <br/>
<a id="pl.7.31"></a><var>7.31</var>maximum total aid it may receive under section 477A.013, subdivision 9, is also increased <br/>
<a id="pl.7.32"></a><var>7.32</var>by $30,000 in calendar year 2009, only if the city had a population in 2005 of less than <br/>
<a id="pl.7.33"></a><var>7.33</var>3,000 and the city's boundaries as of 2007 were formed by the consolidation of two cities <br/>
<a id="pl.7.34"></a><var>7.34</var>and one township in 2002.<br/>
<a id="pl.7.35"></a><var>7.35</var><b>EFFECTIVE DATE.</b>This section is effective for aids payable in calendar year <br/>
<a id="pl.7.36"></a><var>7.36</var>2009 and thereafter.<br/>
<br/>
<a id="bill.1.2.0"></a><a id="pl.8.1"></a><var>8.1</var>    Sec. 2. Minnesota Statutes 2006, section 477A.013, subdivision 8, is amended to read:<br/>
<a id="pl.8.2"></a><var>8.2</var>    Subd. 8. <b>City formula aid.</b> In calendar year 2004 and subsequent years, the <br/>
<a id="pl.8.3"></a><var>8.3</var>formula aid for a city is equal to the need increase percentage multiplied by the difference <br/>
<a id="pl.8.4"></a><var>8.4</var>between (1) the city's revenue need multiplied by its population, and (2) the sum of the <br/>
<a id="pl.8.5"></a><var>8.5</var>city's net tax capacity multiplied by the tax effort rate; the taconite aids under sections <br/>
<a id="pl.8.6"></a><var>8.6</var><statute_ref>298.28</statute_ref> and 
<statute_ref>298.282</statute_ref> to any city except a city directly impacted by a taconite mine or plant, <br/>
<a id="pl.8.7"></a><var>8.7</var>multiplied by the following percentages:.<br/>
<a id="pl.8.8"></a><var>8.8</var>    (i) zero percent for aids payable in 2004;<br/>
<a id="pl.8.9"></a><var>8.9</var>    (ii) 25 percent for aids payable in 2005;<br/>
<a id="pl.8.10"></a><var>8.10</var>    (iii) 50 percent for aids payable in 2006;<br/>
<a id="pl.8.11"></a><var>8.11</var>    (iv) 75 percent for aids payable in 2007; and<br/>
<a id="pl.8.12"></a><var>8.12</var>    (v) 100 percent for aids payable in 2008 and thereafter.<br/>
<a id="pl.8.13"></a><var>8.13</var>    For purposes of this subdivision, "a city directly impacted by a taconite mine or <br/>
<a id="pl.8.14"></a><var>8.14</var>plant" means: (1) Babbit, (2) Eveleth, (3) Hibbing, (4) Keewatin, (5) Mountain Iron, (6) <br/>
<a id="pl.8.15"></a><var>8.15</var>Silver Bay, or (7) Virginia.<br/>
<a id="pl.8.16"></a><var>8.16</var>No city may have a formula aid amount less than zero. The need increase percentage <br/>
<a id="pl.8.17"></a><var>8.17</var>must be the same for all cities.<br/>
<a id="pl.8.18"></a><var>8.18</var>    The applicable need increase percentage must be calculated by the Department of <br/>
<a id="pl.8.19"></a><var>8.19</var>Revenue so that the total of the aid under subdivision 9 equals the total amount available <br/>
<a id="pl.8.20"></a><var>8.20</var>for aid under section 
         <statute_ref>477A.03</statute_ref> after the subtraction under section 
         <statute_ref>477A.014, subdivisions <br/>
<a id="pl.8.21"></a><var>8.21</var>4 and 5
         </statute_ref>.<br/>
<a id="pl.8.22"></a><var>8.22</var><b>EFFECTIVE DATE.</b>This section is effective for aids payable in calendar year <br/>
<a id="pl.8.23"></a><var>8.23</var>2009 and thereafter.<br/>
<br/>
<a id="bill.1.3.0"></a><a id="pl.8.24"></a><var>8.24</var>    Sec. 3. Minnesota Statutes 2006, section 477A.013, subdivision 9, is amended to read:<br/>
<a id="pl.8.25"></a><var>8.25</var>    Subd. 9. <b>City aid distribution.</b> (a) In calendar year 2002 and thereafter, each <br/>
<a id="pl.8.26"></a><var>8.26</var>city shall receive an aid distribution equal to the sum of (1) the city formula aid under <br/>
<a id="pl.8.27"></a><var>8.27</var>subdivision 8, and (2) its city aid base. In calendar year 2009, each city shall receive an <br/>
<a id="pl.8.28"></a><var>8.28</var>aid distribution equal to the sum of (1) the city formula aid under subdivision 8, (2) its city <br/>
<a id="pl.8.29"></a><var>8.29</var>aid base, and (3) one-half of the difference between its total aid in the previous year under <br/>
<a id="pl.8.30"></a><var>8.30</var>this subdivision and its city aid base in the previous year. <br/>
<a id="pl.8.31"></a><var>8.31</var>(b) For aids payable in 2010 and thereafter, each city shall receive an aid distribution <br/>
<a id="pl.8.32"></a><var>8.32</var>equal to (1) the city aid formula under subdivision 8, (2) its city aid base, and (3) its <br/>
<a id="pl.8.33"></a><var>8.33</var>formula aid under subdivision 8 in the previous year, prior to any adjustments under <br/>
<a id="pl.8.34"></a><var>8.34</var>this subdivision.<br/>
<a id="pl.9.1"></a><var>9.1</var>    (b) (c) For aids payable in 2005 2009 and thereafter, the total aid for any city shall <br/>
<a id="pl.9.2"></a><var>9.2</var>not exceed the sum of (1) ten percent of the city's net levy for the year prior to the aid <br/>
<a id="pl.9.3"></a><var>9.3</var>distribution plus (2) its total aid in the previous year. For aids payable in 2005 2009 and <br/>
<a id="pl.9.4"></a><var>9.4</var>thereafter, the total aid for any city with a population of 2,500 or more may not decrease <br/>
<a id="pl.9.5"></a><var>9.5</var>from be less than its total aid under this section in the previous year by an amount greater <br/>
<a id="pl.9.6"></a><var>9.6</var>than minus the lesser of $15 multiplied by its population, or ten percent of its net levy in <br/>
<a id="pl.9.7"></a><var>9.7</var>the year prior to the aid distribution.<br/>
<a id="pl.9.8"></a><var>9.8</var>    (c) For aids payable in 2004 only, the total aid for a city with a population less than <br/>
<a id="pl.9.9"></a><var>9.9</var>2,500 may not be less than the amount it was certified to receive in 2003 minus the greater <br/>
<a id="pl.9.10"></a><var>9.10</var>of (1) the reduction to this aid payment in 2003 under Laws 2003, First Special Session <br/>
<a id="pl.9.11"></a><var>9.11</var>chapter 21, article 5, or (2) five percent of its 2003 aid amount. (d) For aids payable in <br/>
<a id="pl.9.12"></a><var>9.12</var>2005 2009 and thereafter, the total aid for a city with a population less than 2,500 must not <br/>
<a id="pl.9.13"></a><var>9.13</var>be less than the amount it was certified to receive in the previous year minus the lesser of <br/>
<a id="pl.9.14"></a><var>9.14</var>$15 multiplied by its population, or five percent of its 2003 certified aid amount.<br/>
<a id="pl.9.15"></a><var>9.15</var>    (d) (e) If a city's net tax capacity used in calculating aid under this section has <br/>
<a id="pl.9.16"></a><var>9.16</var>decreased in any year by more than 25 percent from its net tax capacity in the previous <br/>
<a id="pl.9.17"></a><var>9.17</var>year due to property becoming tax-exempt Indian land, the city's maximum allowed aid <br/>
<a id="pl.9.18"></a><var>9.18</var>increase under paragraph (b) (c) shall be increased by an amount equal to (1) the city's tax <br/>
<a id="pl.9.19"></a><var>9.19</var>rate in the year of the aid calculation, multiplied by (2) the amount of its net tax capacity <br/>
<a id="pl.9.20"></a><var>9.20</var>decrease resulting from the property becoming tax exempt.<br/>
<a id="pl.9.21"></a><var>9.21</var><b>EFFECTIVE DATE.</b>This section is effective for aids payable in calendar year <br/>
<a id="pl.9.22"></a><var>9.22</var>2009 and thereafter.<br/>
<br/>
<a id="bill.1.4.0"></a><a id="pl.9.23"></a><var>9.23</var>    Sec. 4. Laws 2006, chapter 259, article 11, section 3, is amended to read:<br/>
<a id="pl.9.24"></a><var>9.24</var>    Sec. 3. <b>MAHNOMEN COUNTY; COUNTY, CITY, SCHOOL DISTRICT, </b><br/>
<a id="pl.9.25"></a><var>9.25</var><b>PROPERTY TAX REIMBURSEMENT</b><b>; 2006 ONLY</b><b>.</b><br/>
<a id="pl.9.26"></a><var>9.26</var>    Subdivision 1.  <b>Aid appropriation.</b> $600,000 is appropriated annually from the <br/>
<a id="pl.9.27"></a><var>9.27</var>general fund to the commissioner of revenue to be used to make payments to compensate <br/>
<a id="pl.9.28"></a><var>9.28</var>for the loss of property tax revenue due to the placement of land located in the city of <br/>
<a id="pl.9.29"></a><var>9.29</var>Mahnomen that was put in trust status by the United Stated Department of the Interior, <br/>
<a id="pl.9.30"></a><var>9.30</var>Bureau of Indian Affairs, during calendar year 2006 related to the trust conversion <br/>
<a id="pl.9.31"></a><var>9.31</var>application of the Shooting Star Casino. The commissioner shall pay the county of <br/>
<a id="pl.9.32"></a><var>9.32</var>Mahnomen, $450,000; the city of Mahnomen, $80,000; and Independent School District <br/>
<a id="pl.9.33"></a><var>9.33</var>No. 432, Mahnomen, $70,000. The payments shall be made on July 20, 2006 of 2008 <br/>
<a id="pl.9.34"></a><var>9.34</var>and each subsequent year. <br/>
<a id="pl.10.1"></a><var>10.1</var>    Subd. 2.  <b>School district tax base adjustments.</b> The Department of Revenue <br/>
<a id="pl.10.2"></a><var>10.2</var>must reduce the referendum market value and the adjusted net tax capacity certified <br/>
<a id="pl.10.3"></a><var>10.3</var>for assessment year 2005 used to calculate school levies for taxes payable in 2007 <br/>
<a id="pl.10.4"></a><var>10.4</var>for Independent School District No. 432, Mahnomen, by the amounts of any values <br/>
<a id="pl.10.5"></a><var>10.5</var>attributable to property that is no longer subject to property taxation because the land has <br/>
<a id="pl.10.6"></a><var>10.6</var>been placed in trust in calendar year 2006 through action of the United States Department <br/>
<a id="pl.10.7"></a><var>10.7</var>of Interior, Bureau of Indian Affairs. The Mahnomen County auditor must certify the <br/>
<a id="pl.10.8"></a><var>10.8</var>reductions in value to the Department of Revenue in the form and manner specified by the <br/>
<a id="pl.10.9"></a><var>10.9</var>Department of Revenue. <br/>
<a id="pl.10.10"></a><var>10.10</var><b>EFFECTIVE DATE.</b>This section is effective for aids payable in calendar year <br/>
<a id="pl.10.11"></a><var>10.11</var>2008 and thereafter.<br/>
<br/>
<a id="bill.1.5.0"></a><a id="pl.10.12"></a><var>10.12</var>    Sec. 5. <b>MAHNOMEN COUNTY; CITY, COUNTY, AND SCHOOL DISTRICT </b><br/>
<a id="pl.10.13"></a><var>10.13</var><b>TAX BASE ADJUSTMENTS.</b><br/>
<a id="pl.10.14"></a><var>10.14</var>    (a) The commissioner of revenue must reduce the referendum market value and <br/>
<a id="pl.10.15"></a><var>10.15</var>adjusted net tax capacity used to calculate school levies beginning with taxes payable in <br/>
<a id="pl.10.16"></a><var>10.16</var>2009 and subsequent years for Independent School District No. 432, Mahnomen, by <br/>
<a id="pl.10.17"></a><var>10.17</var>the amounts attributable to the Shooting Star Casino, which is pending placement into <br/>
<a id="pl.10.18"></a><var>10.18</var>trust status by the United States Department of the Interior, Bureau of Indian Affairs. <br/>
<a id="pl.10.19"></a><var>10.19</var>This adjustment shall be made for each assessment year that the property remains on <br/>
<a id="pl.10.20"></a><var>10.20</var>the tax rolls. The Mahnomen County auditor must certify the reductions in value to the <br/>
<a id="pl.10.21"></a><var>10.21</var>Department of Revenue in the form and manner specified by the commissioner of revenue.<br/>
<a id="pl.10.22"></a><var>10.22</var>    (b) The commissioner of revenue must reduce the county and city net tax capacities <br/>
<a id="pl.10.23"></a><var>10.23</var>used to calculate aids under Minnesota Statutes, sections 477A.011 to 477A.03, beginning <br/>
<a id="pl.10.24"></a><var>10.24</var>with aids payable in 2009 for the county of Mahnomen and the city of Mahnomen, by the <br/>
<a id="pl.10.25"></a><var>10.25</var>amounts attributable to property that is pending placement into trust status by the United <br/>
<a id="pl.10.26"></a><var>10.26</var>States Department of the Interior, Bureau of Indian Affairs. This adjustment shall be made <br/>
<a id="pl.10.27"></a><var>10.27</var>for each assessment year that the property remains on the tax rolls.<br/>
<a id="pl.10.28"></a><var>10.28</var><b>EFFECTIVE DATE.</b>This section is effective for aids and levies payable in 2009 <br/>
<a id="pl.10.29"></a><var>10.29</var>and thereafter.<br/>
<br/>
<a id="bill.1.6.0"></a><a id="pl.10.30"></a><var>10.30</var>    Sec. 6. <b>UTILITY PROPERTY; TAX BASE ADJUSTMENTS FOR </b><br/>
<a id="pl.10.31"></a><var>10.31</var><b>CALCULATION OF SCHOOL DISTRICT AIDS AND LEVIES.</b><br/>
<a id="pl.10.32"></a><var>10.32</var>    For purposes of calculating school levies and aids for fiscal years 2010 and 2011 <br/>
<a id="pl.10.33"></a><var>10.33</var>only, the commissioner of revenue shall compute the adjusted net tax capacity and <br/>
<a id="pl.11.1"></a><var>11.1</var>referendum market value as if the tax base changes resulting from the amendments to <br/>
<a id="pl.11.2"></a><var>11.2</var>Minnesota Rules, chapter 8100, including the phase-in provisions of Minnesota Rules, <br/>
<a id="pl.11.3"></a><var>11.3</var>part 8100.0800, were effective one year earlier.<br/>
<br/>
<a id="bill.1.7.0"></a><a id="pl.11.4"></a><var>11.4</var>    Sec. 7. <b>UTILITY PROPERTY; TAX BASE ADJUSTMENTS FOR </b><br/>
<a id="pl.11.5"></a><var>11.5</var><b>CALCULATION OF COUNTY, CITY, AND TOWN AIDS.</b><br/>
<a id="pl.11.6"></a><var>11.6</var>    For purposes of calculating aid for towns and cities under section 477A.013, and for <br/>
<a id="pl.11.7"></a><var>11.7</var>counties under section 477A.0124, for payment in 2009 and 2010 only, the commissioner <br/>
<a id="pl.11.8"></a><var>11.8</var>of revenue shall calculate the adjusted net tax capacity of cities and counties, as defined <br/>
<a id="pl.11.9"></a><var>11.9</var>in sections 477A.011 and 477A.0124, as if the tax base changes resulting from the <br/>
<a id="pl.11.10"></a><var>11.10</var>amendments to Minnesota Rules, chapter 8100, including the phase-in provisions of <br/>
<a id="pl.11.11"></a><var>11.11</var>Minnesota Rules, part 8100.0800, were effective one year earlier.<br/>
<br/>
<a id="bill.2.0.0"></a>

<a id="bill.2.1.0"></a><a id="pl.11.14"></a><var>11.14</var>    Section 1. Minnesota Statutes 2006, section 97A.061, subdivision 2, is amended to <br/>
<a id="pl.11.15"></a><var>11.15</var>read:<br/>
<a id="pl.11.16"></a><var>11.16</var>    Subd. 2. <b>Allocation.</b> (a) Except as provided in subdivision 3, the county treasurer <br/>
<a id="pl.11.17"></a><var>11.17</var>shall allocate the payment among the county, towns, and school districts on the same basis <br/>
<a id="pl.11.18"></a><var>11.18</var>as if the payments were taxes on the land received in the year. Payment of a town's or a <br/>
<a id="pl.11.19"></a><var>11.19</var>school district's allocation must be made by the county treasurer to the town or school <br/>
<a id="pl.11.20"></a><var>11.20</var>district within 30 days of receipt of the payment to the county. The county's share of the <br/>
<a id="pl.11.21"></a><var>11.21</var>payment shall be deposited in the county general revenue fund.<br/>
<a id="pl.11.22"></a><var>11.22</var>    (b) The county treasurer of a county with a population over 39,000 but less than <br/>
<a id="pl.11.23"></a><var>11.23</var>42,000 in the 1950 federal census shall allocate the payment only among the towns and <br/>
<a id="pl.11.24"></a><var>11.24</var>school districts on the same basis as if the payments were taxes on the lands received <br/>
<a id="pl.11.25"></a><var>11.25</var>in the current year.<br/>
<a id="pl.11.26"></a><var>11.26</var>    (c) If a town received a payment in calendar year 2006 or thereafter under this <br/>
<a id="pl.11.27"></a><var>11.27</var>subdivision, and subsequently incorporated as a city, the city will continue to receive any <br/>
<a id="pl.11.28"></a><var>11.28</var>future year's allocations that would have been made to the town had it not incorporated, <br/>
<a id="pl.11.29"></a><var>11.29</var>provided that the payments will terminate if the governing body of the city passes an <br/>
<a id="pl.11.30"></a><var>11.30</var>ordinance that prohibits hunting within the boundaries of the city.<br/>
<a id="pl.11.31"></a><var>11.31</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for aid payments made <br/>
<a id="pl.11.32"></a><var>11.32</var>in 2007 and thereafter.<br/>
<br/>
<a id="bill.2.2.0"></a><a id="pl.12.1"></a><var>12.1</var>    Sec. 2. Minnesota Statutes 2006, section 127A.48, subdivision 2, is amended to read:<br/>
<a id="pl.12.2"></a><var>12.2</var>    Subd. 2. <b>Methodology.</b> In making its annual assessment/sales ratio studies, the <br/>
<a id="pl.12.3"></a><var>12.3</var>Department of Revenue must use a methodology consistent with the most recent Standard <br/>
<a id="pl.12.4"></a><var>12.4</var>on Assessment Ratio Studies published by the assessment standards committee of the <br/>
<a id="pl.12.5"></a><var>12.5</var>International Association of Assessing Officers. The commissioner of revenue shall <br/>
<a id="pl.12.6"></a><var>12.6</var>supplement this general methodology with specific procedures necessary for execution of <br/>
<a id="pl.12.7"></a><var>12.7</var>the study in accordance with other Minnesota laws impacting the assessment/sales ratio <br/>
<a id="pl.12.8"></a><var>12.8</var>study. The commissioner shall document these specific procedures in writing and shall <br/>
<a id="pl.12.9"></a><var>12.9</var>publish the procedures in the State Register, but these procedures will not be considered <br/>
<a id="pl.12.10"></a><var>12.10</var>"rules" pursuant to the Minnesota Administrative Procedure Act. When property is <br/>
<a id="pl.12.11"></a><var>12.11</var>sold and the purchaser changes its use in a manner that would result in a change of <br/>
<a id="pl.12.12"></a><var>12.12</var>classification of the property, the assessment sales ratio study under this subdivision must <br/>
<a id="pl.12.13"></a><var>12.13</var>take into account that changed classification as soon as practicable. A change in status <br/>
<a id="pl.12.14"></a><var>12.14</var>from homestead to nonhomestead or from nonhomestead to homestead is not a change <br/>
<a id="pl.12.15"></a><var>12.15</var>under this subdivision. For purposes of this section, sections 
         <statute_ref>270.12, subdivision 2</statute_ref>, <br/>
<a id="pl.12.16"></a><var>12.16</var>clause (8), and 
         <statute_ref>278.05, subdivision 4</statute_ref>, the commissioner of revenue shall exclude from <br/>
<a id="pl.12.17"></a><var>12.17</var>the assessment/sales ratio study the sale of any nonagricultural property which does not <br/>
<a id="pl.12.18"></a><var>12.18</var>contain an improvement, if (1) the statutory basis on which the property's taxable value <br/>
<a id="pl.12.19"></a><var>12.19</var>as most recently assessed is less than market value as defined in section 
         <statute_ref>273.11</statute_ref>, or (2) <br/>
<a id="pl.12.20"></a><var>12.20</var>the property has undergone significant physical change or a change of use since the most <br/>
<a id="pl.12.21"></a><var>12.21</var>recent assessment. <br/>
<a id="pl.12.22"></a><var>12.22</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.2.3.0"></a><a id="pl.12.23"></a><var>12.23</var>    Sec. 3. Minnesota Statutes 2006, section 272.02, is amended by adding a subdivision <br/>
<a id="pl.12.24"></a><var>12.24</var>to read:<br/>
<a id="pl.12.25"></a><var>12.25</var>    Subd. 85. <b>Modular homes used as models by dealers.</b> (a) A modular home <br/>
<a id="pl.12.26"></a><var>12.26</var>is exempt if it:<br/>
<a id="pl.12.27"></a><var>12.27</var>    (1) is owned by a modular home dealer and is located on land owned or leased <br/>
<a id="pl.12.28"></a><var>12.28</var>by that dealer;<br/>
<a id="pl.12.29"></a><var>12.29</var>    (2) is a single-family model home;<br/>
<a id="pl.12.30"></a><var>12.30</var>    (3) is not available for sale and is used exclusively as a model;<br/>
<a id="pl.12.31"></a><var>12.31</var>    (4) is not permanently connected to any utilities except electricity; and<br/>
<a id="pl.12.32"></a><var>12.32</var>    (5) is situated on a temporary foundation.<br/>
<a id="pl.12.33"></a><var>12.33</var>    (b) The exemption under this subdivision is allowable for up to five assessment <br/>
<a id="pl.12.34"></a><var>12.34</var>years after the date it becomes located on the property, provided that the modular home <br/>
<a id="pl.12.35"></a><var>12.35</var>continues to meet all of the criteria under this subdivision each year. The owner of a <br/>
<a id="pl.13.1"></a><var>13.1</var>modular model home must notify the county assessor within 60 days that it has been <br/>
<a id="pl.13.2"></a><var>13.2</var>constructed or located on the property and must again notify the assessor if the modular <br/>
<a id="pl.13.3"></a><var>13.3</var>home ceases to meet any of the criteria. If more than one modular home is constructed or <br/>
<a id="pl.13.4"></a><var>13.4</var>situated on a property, the owner must notify the assessor within 60 days for each of the <br/>
<a id="pl.13.5"></a><var>13.5</var>models placed on the property.<br/>
<a id="pl.13.6"></a><var>13.6</var>    (c) For purposes of this subdivision, a "modular home" means a building or <br/>
<a id="pl.13.7"></a><var>13.7</var>structural unit that has been in whole or substantial part manufactured or constructed at an <br/>
<a id="pl.13.8"></a><var>13.8</var>off-site location to be wholly or partially assembled on-site as a single family dwelling. <br/>
<a id="pl.13.9"></a><var>13.9</var>Construction of the modular home must comply with applicable standards adopted in <br/>
<a id="pl.13.10"></a><var>13.10</var>Minnesota Rules authorized under Minnesota Statutes, chapter 16B. A modular home does <br/>
<a id="pl.13.11"></a><var>13.11</var>not include a structure subject to the requirements of the National Manufactured Home <br/>
<a id="pl.13.12"></a><var>13.12</var>Construction and Safety Standards Act of 1974 or prefabricated buildings, as defined in <br/>
<a id="pl.13.13"></a><var>13.13</var>Minnesota Statutes, section 327.31, subdivision 6.<br/>
<a id="pl.13.14"></a><var>13.14</var><b>EFFECTIVE DATE.</b>This section is effective for assessment year 2008 and <br/>
<a id="pl.13.15"></a><var>13.15</var>thereafter, for taxes payable in 2009 and thereafter. The five-year assessment time period <br/>
<a id="pl.13.16"></a><var>13.16</var>begins with the 2008 assessment for a modular model home currently situated provided <br/>
<a id="pl.13.17"></a><var>13.17</var>it meets all of the criteria and the county assessor is notified within 90 days of the day <br/>
<a id="pl.13.18"></a><var>13.18</var>following final enactment.<br/>
<br/>
<a id="bill.2.4.0"></a><a id="pl.13.19"></a><var>13.19</var>    Sec. 4. Minnesota Statutes 2006, section 272.02, is amended by adding a subdivision <br/>
<a id="pl.13.20"></a><var>13.20</var>to read:<br/>
<a id="pl.13.21"></a><var>13.21</var>    Subd. 86. <b>Apprenticeship training facilities.</b> All or a portion of a building used <br/>
<a id="pl.13.22"></a><var>13.22</var>exclusively for a state-approved apprenticeship program through the Department of Labor <br/>
<a id="pl.13.23"></a><var>13.23</var>and Industry is exempt if (1) it is owned and operated by a nonprofit corporation, (2) the <br/>
<a id="pl.13.24"></a><var>13.24</var>program participants receive no compensation, and (3) it is located in the Minneapolis and <br/>
<a id="pl.13.25"></a><var>13.25</var>St. Paul standard metropolitan statistical area as determined by the 2000 federal census or <br/>
<a id="pl.13.26"></a><var>13.26</var>in a city outside the Minneapolis and St. Paul standard metropolitan statistical area that <br/>
<a id="pl.13.27"></a><var>13.27</var>has a population of 7,500 or greater according to the most recent federal census. This <br/>
<a id="pl.13.28"></a><var>13.28</var>exemption does not include land.<br/>
<a id="pl.13.29"></a><var>13.29</var><b>EFFECTIVE DATE.</b>This section is effective for assessment year 2008 and <br/>
<a id="pl.13.30"></a><var>13.30</var>thereafter, for taxes payable in 2009 and thereafter.<br/>
<br/>
<a id="bill.2.5.0"></a><a id="pl.13.31"></a><var>13.31</var>    Sec. 5. Minnesota Statutes 2006, section 272.02, is amended by adding a subdivision <br/>
<a id="pl.13.32"></a><var>13.32</var>to read:<br/>
<a id="pl.14.1"></a><var>14.1</var>    Subd. 87. <b>Monosloped roofs for feedlots and manure storage areas.</b> A <br/>
<a id="pl.14.2"></a><var>14.2</var>monosloped, single-pitched roof installed over a feedlot or manure storage area to prevent <br/>
<a id="pl.14.3"></a><var>14.3</var>runoff is exempt.<br/>
<a id="pl.14.4"></a><var>14.4</var><b>EFFECTIVE DATE.</b>This section is effective for assessment year 2008 for property <br/>
<a id="pl.14.5"></a><var>14.5</var>taxes payable in 2009, and thereafter.<br/>
<br/>
<a id="bill.2.6.0"></a><a id="pl.14.6"></a><var>14.6</var>    Sec. 6. Minnesota Statutes 2006, section 272.115, subdivision 1, is amended to read:<br/>
<a id="pl.14.7"></a><var>14.7</var>    Subdivision 1. <b>Requirement.</b> Except as otherwise provided in subdivision 5, <br/>
<a id="pl.14.8"></a><var>14.8</var>whenever any real estate is sold for a consideration in excess of $1,000, whether by <br/>
<a id="pl.14.9"></a><var>14.9</var>warranty deed, quitclaim deed, contract for deed or any other method of sale, the grantor, <br/>
<a id="pl.14.10"></a><var>14.10</var>grantee or the legal agent of either shall file a certificate of value with the county <br/>
<a id="pl.14.11"></a><var>14.11</var>auditor in the county in which the property is located when the deed or other document <br/>
<a id="pl.14.12"></a><var>14.12</var>is presented for recording. Contract for deeds are subject to recording under section <br/>
<statute_ref><a id="pl.14.13"></a><var>14.13</var>507.235, subdivision 1
         </statute_ref>. Value shall, in the case of any deed not a gift, be the amount of <br/>
<a id="pl.14.14"></a><var>14.14</var>the full actual consideration thereof, paid or to be paid, including the amount of any lien <br/>
<a id="pl.14.15"></a><var>14.15</var>or liens assumed. The items and value of personal property transferred with the real <br/>
<a id="pl.14.16"></a><var>14.16</var>property must be listed and deducted from the sale price. The certificate of value shall <br/>
<a id="pl.14.17"></a><var>14.17</var>include the classification to which the property belongs for the purpose of determining <br/>
<a id="pl.14.18"></a><var>14.18</var>the fair market value of the property, and shall include any proposed change in use of the <br/>
<a id="pl.14.19"></a><var>14.19</var>property known to the person filing the certificate that could change the classification <br/>
<a id="pl.14.20"></a><var>14.20</var>of the property. The certificate shall include financing terms and conditions of the sale <br/>
<a id="pl.14.21"></a><var>14.21</var>which are necessary to determine the actual, present value of the sale price for purposes <br/>
<a id="pl.14.22"></a><var>14.22</var>of the sales ratio study. If the property is being acquired as part of a like-kind exchange <br/>
<a id="pl.14.23"></a><var>14.23</var>under section 1031 of the Internal Revenue Code of 1986, as amended through December <br/>
<a id="pl.14.24"></a><var>14.24</var>31, 2006, that must be indicated on the certificate. The commissioner of revenue shall <br/>
<a id="pl.14.25"></a><var>14.25</var>promulgate administrative rules specifying the financing terms and conditions which must <br/>
<a id="pl.14.26"></a><var>14.26</var>be included on the certificate. Pursuant to the authority of the commissioner of revenue in <br/>
<a id="pl.14.27"></a><var>14.27</var>section 
         <statute_ref>270C.306</statute_ref>, the certificate of value must include the Social Security number or the <br/>
<a id="pl.14.28"></a><var>14.28</var>federal employer identification number of the grantors and grantees. The identification <br/>
<a id="pl.14.29"></a><var>14.29</var>numbers of the grantors and grantees are private data on individuals or nonpublic data <br/>
<a id="pl.14.30"></a><var>14.30</var>as defined in section 
         <statute_ref>13.02, subdivisions 9 and 12</statute_ref>, but, notwithstanding that section, the <br/>
<a id="pl.14.31"></a><var>14.31</var>private or nonpublic data may be disclosed to the commissioner of revenue for purposes of <br/>
<a id="pl.14.32"></a><var>14.32</var>tax administration. The information required to be shown on the certificate of value is <br/>
<a id="pl.14.33"></a><var>14.33</var>limited to the information required as of the date of the acknowledgment on the deed or <br/>
<a id="pl.14.34"></a><var>14.34</var>other document to be recorded.<br/>
<a id="pl.15.1"></a><var>15.1</var><b>EFFECTIVE DATE.</b>This section is effective for certificates filed after June 30, <br/>
<a id="pl.15.2"></a><var>15.2</var>2008.<br/>
<br/>
<a id="bill.2.7.0"></a><a id="pl.15.3"></a><var>15.3</var>    Sec. 7. Minnesota Statutes 2007 Supplement, section 273.124, subdivision 14, is <br/>
<a id="pl.15.4"></a><var>15.4</var>amended to read:<br/>
<a id="pl.15.5"></a><var>15.5</var>    Subd. 14.  <b>Agricultural homesteads; special provisions. </b> (a) Real estate of less than <br/>
<a id="pl.15.6"></a><var>15.6</var>ten acres that is the homestead of its owner must be classified as class 2a under section <br/>
<statute_ref><a id="pl.15.7"></a><var>15.7</var>273.13, subdivision 23
         </statute_ref>, paragraph (a), if: <br/>
<a id="pl.15.8"></a><var>15.8</var>    (1) the parcel on which the house is located is contiguous on at least two sides to (i) <br/>
<a id="pl.15.9"></a><var>15.9</var>agricultural land, (ii) land owned or administered by the United States Fish and Wildlife <br/>
<a id="pl.15.10"></a><var>15.10</var>Service, or (iii) land administered by the Department of Natural Resources on which in <br/>
<a id="pl.15.11"></a><var>15.11</var>lieu taxes are paid under sections 
         <statute_ref>477A.11</statute_ref> to 
         <statute_ref>477A.14</statute_ref>; <br/>
<a id="pl.15.12"></a><var>15.12</var>    (2) its owner also owns a noncontiguous parcel of agricultural land that is at least <br/>
<a id="pl.15.13"></a><var>15.13</var>20 acres; <br/>
<a id="pl.15.14"></a><var>15.14</var>    (3) the noncontiguous land is located not farther than four townships or cities, or a <br/>
<a id="pl.15.15"></a><var>15.15</var>combination of townships or cities from the homestead; and <br/>
<a id="pl.15.16"></a><var>15.16</var>    (4) the agricultural use value of the noncontiguous land and farm buildings is equal <br/>
<a id="pl.15.17"></a><var>15.17</var>to at least 50 percent of the market value of the house, garage, and one acre of land. <br/>
<a id="pl.15.18"></a><var>15.18</var>    Homesteads initially classified as class 2a under the provisions of this paragraph shall <br/>
<a id="pl.15.19"></a><var>15.19</var>remain classified as class 2a, irrespective of subsequent changes in the use of adjoining <br/>
<a id="pl.15.20"></a><var>15.20</var>properties, as long as the homestead remains under the same ownership, the owner owns a <br/>
<a id="pl.15.21"></a><var>15.21</var>noncontiguous parcel of agricultural land that is at least 20 acres, and the agricultural use <br/>
<a id="pl.15.22"></a><var>15.22</var>value qualifies under clause (4). Homestead classification under this paragraph is limited <br/>
<a id="pl.15.23"></a><var>15.23</var>to property that qualified under this paragraph for the 1998 assessment. <br/>
<a id="pl.15.24"></a><var>15.24</var>    (b)(i) Agricultural property consisting of at least 40 acres shall be classified as the <br/>
<a id="pl.15.25"></a><var>15.25</var>owner's homestead, to the same extent as other agricultural homestead property, if all <br/>
<a id="pl.15.26"></a><var>15.26</var>of the following criteria are met: <br/>
<a id="pl.15.27"></a><var>15.27</var>(1) the property consists of at least 40 acres including undivided government lots <br/>
<a id="pl.15.28"></a><var>15.28</var>and correctional 40's;<br/>
<a id="pl.15.29"></a><var>15.29</var>    (1) (2) the owner, the owner's spouse, the son or daughter of the owner or owner's <br/>
<a id="pl.15.30"></a><var>15.30</var>spouse, or the grandson or granddaughter of the owner or the owner's spouse, is actively <br/>
<a id="pl.15.31"></a><var>15.31</var>farming the agricultural property, either on the person's own behalf as an individual or <br/>
<a id="pl.15.32"></a><var>15.32</var>on behalf of a partnership operating a family farm, family farm corporation, joint family <br/>
<a id="pl.15.33"></a><var>15.33</var>farm venture, or limited liability company of which the person is a partner, shareholder, or <br/>
<a id="pl.15.34"></a><var>15.34</var>member; <br/>
<a id="pl.16.1"></a><var>16.1</var>    (2) (3) both the owner of the agricultural property and the person who is actively <br/>
<a id="pl.16.2"></a><var>16.2</var>farming the agricultural property under clause (1) (2), are Minnesota residents; <br/>
<a id="pl.16.3"></a><var>16.3</var>    (3) (4) neither the owner nor the spouse of the owner claims another agricultural <br/>
<a id="pl.16.4"></a><var>16.4</var>homestead in Minnesota; and <br/>
<a id="pl.16.5"></a><var>16.5</var>    (4) (5) neither the owner nor the person actively farming the property lives farther <br/>
<a id="pl.16.6"></a><var>16.6</var>than four townships or cities, or a combination of four townships or cities, from the <br/>
<a id="pl.16.7"></a><var>16.7</var>agricultural property, except that if the owner or the owner's spouse is required to live in <br/>
<a id="pl.16.8"></a><var>16.8</var>employer-provided housing, the owner or owner's spouse, whichever is actively farming <br/>
<a id="pl.16.9"></a><var>16.9</var>the agricultural property, may live more than four townships or cities, or combination of <br/>
<a id="pl.16.10"></a><var>16.10</var>four townships or cities from the agricultural property. <br/>
<a id="pl.16.11"></a><var>16.11</var>    The relationship under this paragraph may be either by blood or marriage. <br/>
<a id="pl.16.12"></a><var>16.12</var>    (ii) Real property held by a trustee under a trust is eligible for agricultural homestead <br/>
<a id="pl.16.13"></a><var>16.13</var>classification under this paragraph if the qualifications in clause (i) are met, except that <br/>
<a id="pl.16.14"></a><var>16.14</var>"owner" means the grantor of the trust. <br/>
<a id="pl.16.15"></a><var>16.15</var>    (iii) Property containing the residence of an owner who owns qualified property <br/>
<a id="pl.16.16"></a><var>16.16</var>under clause (i) shall be classified as part of the owner's agricultural homestead, if that <br/>
<a id="pl.16.17"></a><var>16.17</var>property is also used for noncommercial storage or drying of agricultural crops. <br/>
<a id="pl.16.18"></a><var>16.18</var>    (c) Noncontiguous land shall be included as part of a homestead under section <br/>
<statute_ref><a id="pl.16.19"></a><var>16.19</var>273.13, subdivision 23
         </statute_ref>, paragraph (a), only if the homestead is classified as class 2a <br/>
<a id="pl.16.20"></a><var>16.20</var>and the detached land is located in the same township or city, or not farther than four <br/>
<a id="pl.16.21"></a><var>16.21</var>townships or cities or combination thereof from the homestead. Any taxpayer of these <br/>
<a id="pl.16.22"></a><var>16.22</var>noncontiguous lands must notify the county assessor that the noncontiguous land is part of <br/>
<a id="pl.16.23"></a><var>16.23</var>the taxpayer's homestead, and, if the homestead is located in another county, the taxpayer <br/>
<a id="pl.16.24"></a><var>16.24</var>must also notify the assessor of the other county. <br/>
<a id="pl.16.25"></a><var>16.25</var>    (d) Agricultural land used for purposes of a homestead and actively farmed by a <br/>
<a id="pl.16.26"></a><var>16.26</var>person holding a vested remainder interest in it must be classified as a homestead under <br/>
<a id="pl.16.27"></a><var>16.27</var>section 
         <statute_ref>273.13, subdivision 23</statute_ref>, paragraph (a). If agricultural land is classified class 2a, <br/>
<a id="pl.16.28"></a><var>16.28</var>any other dwellings on the land used for purposes of a homestead by persons holding <br/>
<a id="pl.16.29"></a><var>16.29</var>vested remainder interests who are actively engaged in farming the property, and up to <br/>
<a id="pl.16.30"></a><var>16.30</var>one acre of the land surrounding each homestead and reasonably necessary for the use of <br/>
<a id="pl.16.31"></a><var>16.31</var>the dwelling as a home, must also be assessed class 2a. <br/>
<a id="pl.16.32"></a><var>16.32</var>    (e) Agricultural land and buildings that were class 2a homestead property under <br/>
<a id="pl.16.33"></a><var>16.33</var>section 
         <statute_ref>273.13, subdivision 23</statute_ref>, paragraph (a), for the 1997 assessment shall remain <br/>
<a id="pl.16.34"></a><var>16.34</var>classified as agricultural homesteads for subsequent assessments if: <br/>
<a id="pl.16.35"></a><var>16.35</var>    (1) the property owner abandoned the homestead dwelling located on the agricultural <br/>
<a id="pl.16.36"></a><var>16.36</var>homestead as a result of the April 1997 floods; <br/>
<a id="pl.17.1"></a><var>17.1</var>    (2) the property is located in the county of Polk, Clay, Kittson, Marshall, Norman, <br/>
<a id="pl.17.2"></a><var>17.2</var>or Wilkin; <br/>
<a id="pl.17.3"></a><var>17.3</var>    (3) the agricultural land and buildings remain under the same ownership for the <br/>
<a id="pl.17.4"></a><var>17.4</var>current assessment year as existed for the 1997 assessment year and continue to be used <br/>
<a id="pl.17.5"></a><var>17.5</var>for agricultural purposes; <br/>
<a id="pl.17.6"></a><var>17.6</var>    (4) the dwelling occupied by the owner is located in Minnesota and is within 30 <br/>
<a id="pl.17.7"></a><var>17.7</var>miles of one of the parcels of agricultural land that is owned by the taxpayer; and <br/>
<a id="pl.17.8"></a><var>17.8</var>    (5) the owner notifies the county assessor that the relocation was due to the 1997 <br/>
<a id="pl.17.9"></a><var>17.9</var>floods, and the owner furnishes the assessor any information deemed necessary by the <br/>
<a id="pl.17.10"></a><var>17.10</var>assessor in verifying the change in dwelling. Further notifications to the assessor are not <br/>
<a id="pl.17.11"></a><var>17.11</var>required if the property continues to meet all the requirements in this paragraph and any <br/>
<a id="pl.17.12"></a><var>17.12</var>dwellings on the agricultural land remain uninhabited. <br/>
<a id="pl.17.13"></a><var>17.13</var>    (f) Agricultural land and buildings that were class 2a homestead property under <br/>
<a id="pl.17.14"></a><var>17.14</var>section 
         <statute_ref>273.13, subdivision 23</statute_ref>, paragraph (a), for the 1998 assessment shall remain <br/>
<a id="pl.17.15"></a><var>17.15</var>classified agricultural homesteads for subsequent assessments if: <br/>
<a id="pl.17.16"></a><var>17.16</var>    (1) the property owner abandoned the homestead dwelling located on the agricultural <br/>
<a id="pl.17.17"></a><var>17.17</var>homestead as a result of damage caused by a March 29, 1998, tornado; <br/>
<a id="pl.17.18"></a><var>17.18</var>    (2) the property is located in the county of Blue Earth, Brown, Cottonwood, <br/>
<a id="pl.17.19"></a><var>17.19</var>LeSueur, Nicollet, Nobles, or Rice; <br/>
<a id="pl.17.20"></a><var>17.20</var>    (3) the agricultural land and buildings remain under the same ownership for the <br/>
<a id="pl.17.21"></a><var>17.21</var>current assessment year as existed for the 1998 assessment year; <br/>
<a id="pl.17.22"></a><var>17.22</var>    (4) the dwelling occupied by the owner is located in this state and is within 50 miles <br/>
<a id="pl.17.23"></a><var>17.23</var>of one of the parcels of agricultural land that is owned by the taxpayer; and <br/>
<a id="pl.17.24"></a><var>17.24</var>    (5) the owner notifies the county assessor that the relocation was due to a March 29, <br/>
<a id="pl.17.25"></a><var>17.25</var>1998, tornado, and the owner furnishes the assessor any information deemed necessary by <br/>
<a id="pl.17.26"></a><var>17.26</var>the assessor in verifying the change in homestead dwelling. For taxes payable in 1999, the <br/>
<a id="pl.17.27"></a><var>17.27</var>owner must notify the assessor by December 1, 1998. Further notifications to the assessor <br/>
<a id="pl.17.28"></a><var>17.28</var>are not required if the property continues to meet all the requirements in this paragraph <br/>
<a id="pl.17.29"></a><var>17.29</var>and any dwellings on the agricultural land remain uninhabited. <br/>
<a id="pl.17.30"></a><var>17.30</var>    (g) Agricultural property consisting of at least 40 acres of a family farm corporation, <br/>
<a id="pl.17.31"></a><var>17.31</var>joint family farm venture, family farm limited liability company, or partnership operating <br/>
<a id="pl.17.32"></a><var>17.32</var>a family farm as described under subdivision 8 shall be classified homestead, to the same <br/>
<a id="pl.17.33"></a><var>17.33</var>extent as other agricultural homestead property, if all of the following criteria are met: <br/>
<a id="pl.17.34"></a><var>17.34</var>(1) the property consists of at least 40 acres including undivided government lots <br/>
<a id="pl.17.35"></a><var>17.35</var>and correctional 40's;<br/>
<a id="pl.18.1"></a><var>18.1</var>    (1) (2) a shareholder, member, or partner of that entity is actively farming the <br/>
<a id="pl.18.2"></a><var>18.2</var>agricultural property; <br/>
<a id="pl.18.3"></a><var>18.3</var>    (2) (3) that shareholder, member, or partner who is actively farming the agricultural <br/>
<a id="pl.18.4"></a><var>18.4</var>property is a Minnesota resident; <br/>
<a id="pl.18.5"></a><var>18.5</var>    (3) (4) neither that shareholder, member, or partner, nor the spouse of that <br/>
<a id="pl.18.6"></a><var>18.6</var>shareholder, member, or partner claims another agricultural homestead in Minnesota; and <br/>
<a id="pl.18.7"></a><var>18.7</var>    (4) (5) that shareholder, member, or partner does not live farther than four townships <br/>
<a id="pl.18.8"></a><var>18.8</var>or cities, or a combination of four townships or cities, from the agricultural property. <br/>
<a id="pl.18.9"></a><var>18.9</var>    Homestead treatment applies under this paragraph for property leased to a family <br/>
<a id="pl.18.10"></a><var>18.10</var>farm corporation, joint farm venture, limited liability company, or partnership operating a <br/>
<a id="pl.18.11"></a><var>18.11</var>family farm if legal title to the property is in the name of an individual who is a member, <br/>
<a id="pl.18.12"></a><var>18.12</var>shareholder, or partner in the entity. <br/>
<a id="pl.18.13"></a><var>18.13</var>    (h) To be eligible for the special agricultural homestead under this subdivision, an <br/>
<a id="pl.18.14"></a><var>18.14</var>initial full application must be submitted to the county assessor where the property is <br/>
<a id="pl.18.15"></a><var>18.15</var>located. Owners and the persons who are actively farming the property shall be required <br/>
<a id="pl.18.16"></a><var>18.16</var>to complete only a one-page abbreviated version of the application in each subsequent <br/>
<a id="pl.18.17"></a><var>18.17</var>year provided that none of the following items have changed since the initial application: <br/>
<a id="pl.18.18"></a><var>18.18</var>    (1) the day-to-day operation, administration, and financial risks remain the same; <br/>
<a id="pl.18.19"></a><var>18.19</var>    (2) the owners and the persons actively farming the property continue to live within <br/>
<a id="pl.18.20"></a><var>18.20</var>the four townships or city criteria and are Minnesota residents; <br/>
<a id="pl.18.21"></a><var>18.21</var>    (3) the same operator of the agricultural property is listed with the Farm Service <br/>
<a id="pl.18.22"></a><var>18.22</var>Agency; <br/>
<a id="pl.18.23"></a><var>18.23</var>    (4) a Schedule F or equivalent income tax form was filed for the most recent year; <br/>
<a id="pl.18.24"></a><var>18.24</var>    (5) the property's acreage is unchanged; and <br/>
<a id="pl.18.25"></a><var>18.25</var>    (6) none of the property's acres have been enrolled in a federal or state farm program <br/>
<a id="pl.18.26"></a><var>18.26</var>since the initial application. <br/>
<a id="pl.18.27"></a><var>18.27</var>    The owners and any persons who are actively farming the property must include <br/>
<a id="pl.18.28"></a><var>18.28</var>the appropriate Social Security numbers, and sign and date the application. If any of the <br/>
<a id="pl.18.29"></a><var>18.29</var>specified information has changed since the full application was filed, the owner must <br/>
<a id="pl.18.30"></a><var>18.30</var>notify the assessor, and must complete a new application to determine if the property <br/>
<a id="pl.18.31"></a><var>18.31</var>continues to qualify for the special agricultural homestead. The commissioner of revenue <br/>
<a id="pl.18.32"></a><var>18.32</var>shall prepare a standard reapplication form for use by the assessors. <br/>
<a id="pl.18.33"></a><var>18.33</var>    (i) Agricultural land and buildings that were class 2a homestead property under <br/>
<a id="pl.18.34"></a><var>18.34</var>section 
         <statute_ref>273.13, subdivision 23</statute_ref>, paragraph (a), for the 2007 assessment shall remain <br/>
<a id="pl.18.35"></a><var>18.35</var>classified agricultural homesteads for subsequent assessments if: <br/>
<a id="pl.19.1"></a><var>19.1</var>    (1) the property owner abandoned the homestead dwelling located on the agricultural <br/>
<a id="pl.19.2"></a><var>19.2</var>homestead as a result of damage caused by the August 2007 floods; <br/>
<a id="pl.19.3"></a><var>19.3</var>    (2) the property is located in the county of Dodge, Fillmore, Houston, Olmsted, <br/>
<a id="pl.19.4"></a><var>19.4</var>Steele, Wabasha, or Winona; <br/>
<a id="pl.19.5"></a><var>19.5</var>    (3) the agricultural land and buildings remain under the same ownership for the <br/>
<a id="pl.19.6"></a><var>19.6</var>current assessment year as existed for the 2007 assessment year; <br/>
<a id="pl.19.7"></a><var>19.7</var>    (4) the dwelling occupied by the owner is located in this state and is within 50 miles <br/>
<a id="pl.19.8"></a><var>19.8</var>of one of the parcels of agricultural land that is owned by the taxpayer; and <br/>
<a id="pl.19.9"></a><var>19.9</var>    (5) the owner notifies the county assessor that the relocation was due to the August <br/>
<a id="pl.19.10"></a><var>19.10</var>2007 floods, and the owner furnishes the assessor any information deemed necessary by <br/>
<a id="pl.19.11"></a><var>19.11</var>the assessor in verifying the change in homestead dwelling. For taxes payable in 2009, the <br/>
<a id="pl.19.12"></a><var>19.12</var>owner must notify the assessor by December 1, 2008. Further notifications to the assessor <br/>
<a id="pl.19.13"></a><var>19.13</var>are not required if the property continues to meet all the requirements in this paragraph <br/>
<a id="pl.19.14"></a><var>19.14</var>and any dwellings on the agricultural land remain uninhabited. <br/>
<a id="pl.19.15"></a><var>19.15</var><b>EFFECTIVE DATE.</b>This section is effective for assessment year 2008, taxes <br/>
<a id="pl.19.16"></a><var>19.16</var>payable in 2009 and thereafter.<br/>
<br/>
<a id="bill.2.8.0"></a><a id="pl.19.17"></a><var>19.17</var>    Sec. 8. Minnesota Statutes 2006, section 273.124, is amended by adding a subdivision <br/>
<a id="pl.19.18"></a><var>19.18</var>to read:<br/>
<a id="pl.19.19"></a><var>19.19</var>    Subd. 22. <b>Annual registration of certain relative homesteads.</b> If the owner of <br/>
<a id="pl.19.20"></a><var>19.20</var>property or the owner's relative who occupies property that is classified as a homestead <br/>
<a id="pl.19.21"></a><var>19.21</var>under subdivision 1, paragraph (c), receives compensation for allowing occupancy of any <br/>
<a id="pl.19.22"></a><var>19.22</var>part of that property for a period that exceeds 31 consecutive days during the calendar <br/>
<a id="pl.19.23"></a><var>19.23</var>year, the recipient of the compensation must register the property with the city in which <br/>
<a id="pl.19.24"></a><var>19.24</var>it is located no later than 60 days after the initial rental period began. This requirement <br/>
<a id="pl.19.25"></a><var>19.25</var>applies to property located in a city that has a population over 25,000. Each city must <br/>
<a id="pl.19.26"></a><var>19.26</var>maintain a file of these property registrations that is open to the public, and retain the <br/>
<a id="pl.19.27"></a><var>19.27</var>registrations for one year after the date of filing.<br/>
<a id="pl.19.28"></a><var>19.28</var><b>EFFECTIVE DATE.</b>This section is effective July 1, 2008.<br/>
<br/>
<a id="bill.2.9.0"></a><a id="pl.19.29"></a><var>19.29</var>    Sec. 9. Minnesota Statutes 2006, section 273.125, subdivision 8, is amended to read:<br/>
<a id="pl.19.30"></a><var>19.30</var>    Subd. 8. <b>Manufactured homes; sectional structures.</b> (a) In this section, <br/>
<a id="pl.19.31"></a><var>19.31</var>"manufactured home" means a structure transportable in one or more sections, which is <br/>
<a id="pl.19.32"></a><var>19.32</var>built on a permanent chassis, and designed to be used as a dwelling with or without a <br/>
<a id="pl.19.33"></a><var>19.33</var>permanent foundation when connected to the required utilities, and contains the plumbing, <br/>
<a id="pl.20.1"></a><var>20.1</var>heating, air conditioning, and electrical systems in it. Manufactured home includes any <br/>
<a id="pl.20.2"></a><var>20.2</var>accessory structure that is an addition or supplement to the manufactured home and, when <br/>
<a id="pl.20.3"></a><var>20.3</var>installed, becomes a part of the manufactured home.<br/>
<a id="pl.20.4"></a><var>20.4</var>    (b) Except as provided in paragraph (c), a manufactured home that meets each of the <br/>
<a id="pl.20.5"></a><var>20.5</var>following criteria must be valued and assessed as an improvement to real property, the <br/>
<a id="pl.20.6"></a><var>20.6</var>appropriate real property classification applies, and the valuation is subject to review and <br/>
<a id="pl.20.7"></a><var>20.7</var>the taxes payable in the manner provided for real property:<br/>
<a id="pl.20.8"></a><var>20.8</var>    (1) the owner of the unit holds title to the land on which it is situated;<br/>
<a id="pl.20.9"></a><var>20.9</var>    (2) the unit is affixed to the land by a permanent foundation or is installed at its <br/>
<a id="pl.20.10"></a><var>20.10</var>location in accordance with the Manufactured Home Building Code in sections 
         <statute_ref>327.31</statute_ref> <br/>
<a id="pl.20.11"></a><var>20.11</var>to 
         <statute_ref>327.34</statute_ref>, and rules adopted under those sections, or is affixed to the land like other real <br/>
<a id="pl.20.12"></a><var>20.12</var>property in the taxing district; and<br/>
<a id="pl.20.13"></a><var>20.13</var>    (3) the unit is connected to public utilities, has a well and septic tank system, or is <br/>
<a id="pl.20.14"></a><var>20.14</var>serviced by water and sewer facilities comparable to other real property in the taxing <br/>
<a id="pl.20.15"></a><var>20.15</var>district.<br/>
<a id="pl.20.16"></a><var>20.16</var>    (c) A manufactured home that meets each of the following criteria must be assessed <br/>
<a id="pl.20.17"></a><var>20.17</var>at the rate provided by the appropriate real property classification but must be treated as <br/>
<a id="pl.20.18"></a><var>20.18</var>personal property, and the valuation is subject to review and the taxes payable in the <br/>
<a id="pl.20.19"></a><var>20.19</var>manner provided in this section:<br/>
<a id="pl.20.20"></a><var>20.20</var>    (1) the owner of the unit is a lessee of the land under the terms of a lease, or the unit <br/>
<a id="pl.20.21"></a><var>20.21</var>is located in a manufactured home park but is not the homestead of the park owner;<br/>
<a id="pl.20.22"></a><var>20.22</var>    (2) the unit is affixed to the land by a permanent foundation or is installed at its <br/>
<a id="pl.20.23"></a><var>20.23</var>location in accordance with the Manufactured Home Building Code contained in sections <br/>
<statute_ref><a id="pl.20.24"></a><var>20.24</var>327.31
         </statute_ref> to 
         <statute_ref>327.34</statute_ref>, and the rules adopted under those sections, or is affixed to the land like <br/>
<a id="pl.20.25"></a><var>20.25</var>other real property in the taxing district; and<br/>
<a id="pl.20.26"></a><var>20.26</var>    (3) the unit is connected to public utilities, has a well and septic tank system, or is <br/>
<a id="pl.20.27"></a><var>20.27</var>serviced by water and sewer facilities comparable to other real property in the taxing <br/>
<a id="pl.20.28"></a><var>20.28</var>district.<br/>
<a id="pl.20.29"></a><var>20.29</var>    (d) Sectional structures must be valued and assessed as an improvement to real <br/>
<a id="pl.20.30"></a><var>20.30</var>property if the owner of the structure holds title to the land on which it is located or is a <br/>
<a id="pl.20.31"></a><var>20.31</var>qualifying lessee of the land under section 
         <statute_ref>273.19</statute_ref>. In this paragraph "sectional structure" <br/>
<a id="pl.20.32"></a><var>20.32</var>means a building or structural unit that has been in whole or substantial part manufactured <br/>
<a id="pl.20.33"></a><var>20.33</var>or constructed at an off-site location to be wholly or partially assembled on-site alone or <br/>
<a id="pl.20.34"></a><var>20.34</var>with other units and attached to a permanent foundation.<br/>
<a id="pl.21.1"></a><var>21.1</var>    (e) The commissioner of revenue may adopt rules under the Administrative <br/>
<a id="pl.21.2"></a><var>21.2</var>Procedure Act to establish additional criteria for the classification of manufactured homes <br/>
<a id="pl.21.3"></a><var>21.3</var>and sectional structures under this subdivision.<br/>
<a id="pl.21.4"></a><var>21.4</var>    (f) A storage shed, deck, or similar improvement constructed on property that is <br/>
<a id="pl.21.5"></a><var>21.5</var>leased or rented as a site for a manufactured home, sectional structure, park trailer, or <br/>
<a id="pl.21.6"></a><var>21.6</var>travel trailer is taxable as provided in this section. In the case of property that is leased or <br/>
<a id="pl.21.7"></a><var>21.7</var>rented as a site for a travel trailer, a storage shed, deck, or similar improvement on the <br/>
<a id="pl.21.8"></a><var>21.8</var>site that is considered personal property under this paragraph is taxable only if its total <br/>
<a id="pl.21.9"></a><var>21.9</var>estimated market value is over $500 $1,000. The property is taxable as personal property <br/>
<a id="pl.21.10"></a><var>21.10</var>to the lessee of the site if it is not owned by the owner of the site. The property is taxable <br/>
<a id="pl.21.11"></a><var>21.11</var>as real estate if it is owned by the owner of the site. As a condition of permitting the owner <br/>
<a id="pl.21.12"></a><var>21.12</var>of the manufactured home, sectional structure, park trailer, or travel trailer to construct <br/>
<a id="pl.21.13"></a><var>21.13</var>improvements on the leased or rented site, the owner of the site must obtain the permanent <br/>
<a id="pl.21.14"></a><var>21.14</var>home address of the lessee or user of the site. The site owner must provide the name <br/>
<a id="pl.21.15"></a><var>21.15</var>and address to the assessor upon request.<br/>
<a id="pl.21.16"></a><var>21.16</var><b>EFFECTIVE DATE.</b>This section is effective for assessment year 2008 and <br/>
<a id="pl.21.17"></a><var>21.17</var>thereafter, for taxes payable in 2009 and thereafter.<br/>
<br/>
<a id="bill.2.10.0"></a><a id="pl.21.18"></a><var>21.18</var>    Sec. 10. Minnesota Statutes 2006, section 273.128, subdivision 1, is amended to read:<br/>
<a id="pl.21.19"></a><var>21.19</var>    Subdivision 1. <b>Requirement.</b> Low-income rental property classified as class 4d <br/>
<a id="pl.21.20"></a><var>21.20</var>under section 
         <statute_ref>273.13, subdivision 25</statute_ref>, is entitled to valuation under this section if at <br/>
<a id="pl.21.21"></a><var>21.21</var>least 75 20 percent of the units in the rental housing property meet any of the following <br/>
<a id="pl.21.22"></a><var>21.22</var>qualifications:<br/>
<a id="pl.21.23"></a><var>21.23</var>    (1) the units are subject to a housing assistance payments contract under Section 8 <br/>
<a id="pl.21.24"></a><var>21.24</var>of the United States Housing Act of 1937, as amended;<br/>
<a id="pl.21.25"></a><var>21.25</var>    (2) the units are rent-restricted and income-restricted units of a qualified low-income <br/>
<a id="pl.21.26"></a><var>21.26</var>housing project receiving tax credits under section 42(g) of the Internal Revenue Code of <br/>
<a id="pl.21.27"></a><var>21.27</var>1986, as amended;<br/>
<a id="pl.21.28"></a><var>21.28</var>    (3) the units are financed by the Rural Housing Service of the United States <br/>
<a id="pl.21.29"></a><var>21.29</var>Department of Agriculture and receive payments under the rental assistance program <br/>
<a id="pl.21.30"></a><var>21.30</var>pursuant to section 521(a) of the Housing Act of 1949, as amended; or<br/>
<a id="pl.21.31"></a><var>21.31</var>    (4) the units are subject to rent and income restrictions under the terms of financial <br/>
<a id="pl.21.32"></a><var>21.32</var>assistance provided to the rental housing property by the federal government or the <br/>
<a id="pl.21.33"></a><var>21.33</var>state of Minnesota, or a local unit of government, as evidenced by a document recorded <br/>
<a id="pl.21.34"></a><var>21.34</var>against the property.<br/>
<a id="pl.22.1"></a><var>22.1</var>    The restrictions must require assisted units to be occupied by residents whose <br/>
<a id="pl.22.2"></a><var>22.2</var>household income at the time of initial occupancy does not exceed 60 percent of the <br/>
<a id="pl.22.3"></a><var>22.3</var>greater of area or state median income, adjusted for family size, as determined by the <br/>
<a id="pl.22.4"></a><var>22.4</var>United States Department of Housing and Urban Development. The restriction must also <br/>
<a id="pl.22.5"></a><var>22.5</var>require the rents for assisted units to not exceed 30 percent of 60 percent of the greater of <br/>
<a id="pl.22.6"></a><var>22.6</var>area or state median income, adjusted for family size, as determined by the United States <br/>
<a id="pl.22.7"></a><var>22.7</var>Department of Housing and Urban Development.<br/>
<a id="pl.22.8"></a><var>22.8</var><b>EFFECTIVE DATE.</b>This section is effective for property taxes payable in 2009, <br/>
<a id="pl.22.9"></a><var>22.9</var>and thereafter.<br/>
<br/>
<a id="bill.2.11.0"></a><a id="pl.22.10"></a><var>22.10</var>    Sec. 11. Minnesota Statutes 2006, section 273.13, subdivision 22, is amended to read:<br/>
<a id="pl.22.11"></a><var>22.11</var>    Subd. 22. <b>Class 1.</b> (a) Except as provided in subdivision 23 and in paragraphs (b) <br/>
<a id="pl.22.12"></a><var>22.12</var>and (c), real estate which is residential and used for homestead purposes is class 1a. In the <br/>
<a id="pl.22.13"></a><var>22.13</var>case of a duplex or triplex in which one of the units is used for homestead purposes, the <br/>
<a id="pl.22.14"></a><var>22.14</var>entire property is deemed to be used for homestead purposes. The market value of class 1a <br/>
<a id="pl.22.15"></a><var>22.15</var>property must be determined based upon the value of the house, garage, and land.<br/>
<a id="pl.22.16"></a><var>22.16</var>    The first $500,000 of market value of class 1a property has a net class rate of <br/>
<a id="pl.22.17"></a><var>22.17</var>one percent of its market value; and the market value of class 1a property that exceeds <br/>
<a id="pl.22.18"></a><var>22.18</var>$500,000 has a class rate of 1.25 percent of its market value.<br/>
<a id="pl.22.19"></a><var>22.19</var>    (b) Class 1b property includes homestead real estate or homestead manufactured <br/>
<a id="pl.22.20"></a><var>22.20</var>homes used for the purposes of a homestead by<br/>
<a id="pl.22.21"></a><var>22.21</var>    (1) any person who is blind as defined in section 
         <statute_ref>256D.35</statute_ref>, or the blind person and <br/>
<a id="pl.22.22"></a><var>22.22</var>the blind person's spouse; or<br/>
<a id="pl.22.23"></a><var>22.23</var>    (2) any person, hereinafter referred to as "veteran," who:<br/>
<a id="pl.22.24"></a><var>22.24</var>    (i) served in the active military or naval service of the United States; and<br/>
<a id="pl.22.25"></a><var>22.25</var>    (ii) is entitled to compensation under the laws and regulations of the United States <br/>
<a id="pl.22.26"></a><var>22.26</var>for permanent and total service-connected disability due to the loss, or loss of use, by <br/>
<a id="pl.22.27"></a><var>22.27</var>reason of amputation, ankylosis, progressive muscular dystrophies, or paralysis, of both <br/>
<a id="pl.22.28"></a><var>22.28</var>lower extremities, such as to preclude motion without the aid of braces, crutches, canes, or <br/>
<a id="pl.22.29"></a><var>22.29</var>a wheelchair; and<br/>
<a id="pl.22.30"></a><var>22.30</var>    (iii) has acquired a special housing unit with special fixtures or movable facilities <br/>
<a id="pl.22.31"></a><var>22.31</var>made necessary by the nature of the veteran's disability, or the surviving spouse of the <br/>
<a id="pl.22.32"></a><var>22.32</var>deceased veteran for as long as the surviving spouse retains the special housing unit <br/>
<a id="pl.22.33"></a><var>22.33</var>as a homestead; or<br/>
<a id="pl.22.34"></a><var>22.34</var>    (3) any person who is permanently and totally disabled.<br/>
<a id="pl.23.1"></a><var>23.1</var>    Property is classified and assessed under clause (3) (2)  only if the government <br/>
<a id="pl.23.2"></a><var>23.2</var>agency or income-providing source certifies, upon the request of the homestead occupant, <br/>
<a id="pl.23.3"></a><var>23.3</var>that the homestead occupant satisfies the disability requirements of this paragraph.<br/>
<a id="pl.23.4"></a><var>23.4</var>    Property is classified and assessed pursuant to clause (1) under paragraph (b)  only if <br/>
<a id="pl.23.5"></a><var>23.5</var>the commissioner of revenue certifies to the assessor or the county assessor certifies  that <br/>
<a id="pl.23.6"></a><var>23.6</var>the homestead occupant satisfies the requirements of this paragraph.<br/>
<a id="pl.23.7"></a><var>23.7</var>    Permanently and totally disabled for the purpose of this subdivision means a <br/>
<a id="pl.23.8"></a><var>23.8</var>condition which is permanent in nature and totally incapacitates the person from working <br/>
<a id="pl.23.9"></a><var>23.9</var>at an occupation which brings the person an income. The first $32,000 $50,000 market <br/>
<a id="pl.23.10"></a><var>23.10</var>value of class 1b property has a net class rate of .45 percent of its market value. The <br/>
<a id="pl.23.11"></a><var>23.11</var>remaining market value of class 1b property has a class rate using the rates for class 1a or <br/>
<a id="pl.23.12"></a><var>23.12</var>class 2a property, whichever is appropriate, of similar market value.<br/>
<a id="pl.23.13"></a><var>23.13</var>    (c) Class 1c property is commercial use real and personal property that abuts <br/>
<a id="pl.23.14"></a><var>23.14</var>a lakeshore line public water as defined in section 103G.005, subdivision 15, and is <br/>
<a id="pl.23.15"></a><var>23.15</var>devoted to temporary and seasonal residential occupancy for recreational purposes but <br/>
<a id="pl.23.16"></a><var>23.16</var>not devoted to commercial purposes for more than 250 days in the year preceding the <br/>
<a id="pl.23.17"></a><var>23.17</var>year of assessment, and that includes a portion used as a homestead by the owner, which <br/>
<a id="pl.23.18"></a><var>23.18</var>includes a dwelling occupied as a homestead by a shareholder of a corporation that owns <br/>
<a id="pl.23.19"></a><var>23.19</var>the resort, a partner in a partnership that owns the resort, or a member of a limited liability <br/>
<a id="pl.23.20"></a><var>23.20</var>company that owns the resort even if the title to the homestead is held by the corporation, <br/>
<a id="pl.23.21"></a><var>23.21</var>partnership, or limited liability company. For purposes of this clause, property is devoted <br/>
<a id="pl.23.22"></a><var>23.22</var>to a commercial purpose on a specific day if any portion of the property, excluding the <br/>
<a id="pl.23.23"></a><var>23.23</var>portion used exclusively as a homestead, is used for residential occupancy and a fee is <br/>
<a id="pl.23.24"></a><var>23.24</var>charged for residential occupancy. Class 1c property must contain three or more rental <br/>
<a id="pl.23.25"></a><var>23.25</var>units. A "rental unit" is defined as a cabin, condominium, townhouse, sleeping room, <br/>
<a id="pl.23.26"></a><var>23.26</var>or individual camping site equipped with water and electrical hookups for recreational <br/>
<a id="pl.23.27"></a><var>23.27</var>vehicles. Class 1c property must provide recreational activities such as the rental of ice <br/>
<a id="pl.23.28"></a><var>23.28</var>fishing houses, boats and motors, snowmobiles, downhill or cross-country ski equipment; <br/>
<a id="pl.23.29"></a><var>23.29</var>provide marina services, launch services, or guide services; or sell bait and fishing tackle. <br/>
<a id="pl.23.30"></a><var>23.30</var>Any unit in which the right to use the property is transferred to an individual or entity <br/>
<a id="pl.23.31"></a><var>23.31</var>by deeded interest, or the sale of shares or stock, no longer qualifies for class 1c even <br/>
<a id="pl.23.32"></a><var>23.32</var>though it may remain available for rent. A camping pad offered for rent by a property <br/>
<a id="pl.23.33"></a><var>23.33</var>that otherwise qualifies for class 1c is also class 1c, regardless of the term of the rental <br/>
<a id="pl.23.34"></a><var>23.34</var>agreement, as long as the use of the camping pad does not exceed 250 days. The portion of <br/>
<a id="pl.23.35"></a><var>23.35</var>the property used as a homestead is class 1a property under paragraph (a). The remainder <br/>
<a id="pl.23.36"></a><var>23.36</var>of the property is classified as follows: the first $500,000 $600,000  of market value is tier <br/>
<a id="pl.24.1"></a><var>24.1</var>I, the next $1,700,000 of market value is tier II, and any remaining market value is tier <br/>
<a id="pl.24.2"></a><var>24.2</var>III. The class rates for class 1c are: tier I, 0.55 0.50  percent; tier II, 1.0 percent; and tier <br/>
<a id="pl.24.3"></a><var>24.3</var>III, 1.25 percent. If a class 1c resort property has any market value in tier III, the entire <br/>
<a id="pl.24.4"></a><var>24.4</var>property must meet the requirements of subdivision 25, paragraph (d), clause (1), to <br/>
<a id="pl.24.5"></a><var>24.5</var>qualify for class 1c treatment under this paragraph. Owners of real and personal property <br/>
<a id="pl.24.6"></a><var>24.6</var>devoted to temporary and seasonal residential occupancy for recreation purposes in which <br/>
<a id="pl.24.7"></a><var>24.7</var>all or a portion of the property was devoted to commercial purposes for not more than 250 <br/>
<a id="pl.24.8"></a><var>24.8</var>days in the year preceding the year of assessment desiring classification as class 1c, must <br/>
<a id="pl.24.9"></a><var>24.9</var>submit a declaration to the assessor designating the cabins or units occupied for 250 days <br/>
<a id="pl.24.10"></a><var>24.10</var>or less in the year preceding the year of assessment by January 15 of the assessment year. <br/>
<a id="pl.24.11"></a><var>24.11</var>Those cabins or units and a proportionate share of the land on which they are located must <br/>
<a id="pl.24.12"></a><var>24.12</var>be designated as class 1c as otherwise provided. The remainder of the cabins or units and <br/>
<a id="pl.24.13"></a><var>24.13</var>a proportionate share of the land on which they are located must be designated as class <br/>
<a id="pl.24.14"></a><var>24.14</var>3a commercial. The owner of property desiring designation as class 1c property must <br/>
<a id="pl.24.15"></a><var>24.15</var>provide guest registers or other records demonstrating that the units for which class 1c <br/>
<a id="pl.24.16"></a><var>24.16</var>designation is sought were not occupied for more than 250 days in the year preceding the <br/>
<a id="pl.24.17"></a><var>24.17</var>assessment if so requested. The portion of a property operated as a (1) restaurant, (2) bar, <br/>
<a id="pl.24.18"></a><var>24.18</var>(3) gift shop, (4) conference center or meeting room, and (5) other nonresidential facility <br/>
<a id="pl.24.19"></a><var>24.19</var>operated on a commercial basis not directly related to temporary and seasonal residential <br/>
<a id="pl.24.20"></a><var>24.20</var>occupancy for recreation purposes does not qualify for class 1c.<br/>
<a id="pl.24.21"></a><var>24.21</var>    (d) Class 1d property includes structures that meet all of the following criteria:<br/>
<a id="pl.24.22"></a><var>24.22</var>    (1) the structure is located on property that is classified as agricultural property under <br/>
<a id="pl.24.23"></a><var>24.23</var>section 
         <statute_ref>273.13, subdivision 23</statute_ref>;<br/>
<a id="pl.24.24"></a><var>24.24</var>    (2) the structure is occupied exclusively by seasonal farm workers during the time <br/>
<a id="pl.24.25"></a><var>24.25</var>when they work on that farm, and the occupants are not charged rent for the privilege of <br/>
<a id="pl.24.26"></a><var>24.26</var>occupying the property, provided that use of the structure for storage of farm equipment <br/>
<a id="pl.24.27"></a><var>24.27</var>and produce does not disqualify the property from classification under this paragraph;<br/>
<a id="pl.24.28"></a><var>24.28</var>    (3) the structure meets all applicable health and safety requirements for the <br/>
<a id="pl.24.29"></a><var>24.29</var>appropriate season; and<br/>
<a id="pl.24.30"></a><var>24.30</var>    (4) the structure is not salable as residential property because it does not comply <br/>
<a id="pl.24.31"></a><var>24.31</var>with local ordinances relating to location in relation to streets or roads.<br/>
<a id="pl.24.32"></a><var>24.32</var>    The market value of class 1d property has the same class rates as class 1a property <br/>
<a id="pl.24.33"></a><var>24.33</var>under paragraph (a).<br/>
<a id="pl.24.34"></a><var>24.34</var><b>EFFECTIVE DATE.</b>The amendments of this section to paragraph (b) are effective <br/>
<a id="pl.24.35"></a><var>24.35</var>for taxes payable in 2009 and thereafter. The rest of this section is effective for taxes <br/>
<a id="pl.24.36"></a><var>24.36</var>payable in 2010 and thereafter.<br/>
<br/>
<a id="bill.2.12.0"></a><a id="pl.25.1"></a><var>25.1</var>    Sec. 12. Minnesota Statutes 2006, section 273.13, subdivision 23, is amended to read:<br/>
<a id="pl.25.2"></a><var>25.2</var>    Subd. 23. <b>Class 2.</b> (a) Class 2a property is agricultural land including any <br/>
<a id="pl.25.3"></a><var>25.3</var>improvements that is homesteaded. The market value of the house and garage and <br/>
<a id="pl.25.4"></a><var>25.4</var>immediately surrounding one acre of land has the same class rates as class 1a property <br/>
<a id="pl.25.5"></a><var>25.5</var>under subdivision 22. The value of the remaining land including improvements up to <br/>
<a id="pl.25.6"></a><var>25.6</var>the first tier valuation limit of agricultural homestead property has a net class rate of <br/>
<a id="pl.25.7"></a><var>25.7</var>0.55 percent of market value. The remaining property over the first tier has a class rate <br/>
<a id="pl.25.8"></a><var>25.8</var>of one percent of market value. For purposes of this subdivision, the "first tier valuation <br/>
<a id="pl.25.9"></a><var>25.9</var>limit of agricultural homestead property" and "first tier" means the limit certified under <br/>
<a id="pl.25.10"></a><var>25.10</var>section 
         <statute_ref>273.11</statute_ref>, subdivision 23.<br/>
<a id="pl.25.11"></a><var>25.11</var>    (b) Class 2b property is (1) real estate, rural in character and used exclusively for <br/>
<a id="pl.25.12"></a><var>25.12</var>growing trees for timber, lumber, and wood and wood products; (2) real estate that is not <br/>
<a id="pl.25.13"></a><var>25.13</var>improved with a structure and is used exclusively for growing trees for timber, lumber, and <br/>
<a id="pl.25.14"></a><var>25.14</var>wood and wood products, if the owner has participated or is participating in a cost-sharing <br/>
<a id="pl.25.15"></a><var>25.15</var>program for afforestation, reforestation, or timber stand improvement on that particular <br/>
<a id="pl.25.16"></a><var>25.16</var>property, administered or coordinated by the commissioner of natural resources; (3) real <br/>
<a id="pl.25.17"></a><var>25.17</var>estate that is nonhomestead agricultural land; or (4) a landing area or public access area of <br/>
<a id="pl.25.18"></a><var>25.18</var>a privately owned public use airport. Class 2b property has a net class rate of one percent <br/>
<a id="pl.25.19"></a><var>25.19</var>of market value, except that unplatted property described in clause (1) or (2) has a net <br/>
<a id="pl.25.20"></a><var>25.20</var>class rate of .65 percent if it consists of no less than ten and no more than 1,920 acres <br/>
<a id="pl.25.21"></a><var>25.21</var>and is being managed under a forest management plan that meets the requirements of <br/>
<a id="pl.25.22"></a><var>25.22</var>chapter 290C, but is not enrolled in the sustainable forest resource management incentive <br/>
<a id="pl.25.23"></a><var>25.23</var>program, provided that the owner of the property must apply to the assessor annually to <br/>
<a id="pl.25.24"></a><var>25.24</var>receive the reduced class rate and provide the information required by the assessor to <br/>
<a id="pl.25.25"></a><var>25.25</var>verify that the property qualifies for the reduced rate.<br/>
<a id="pl.25.26"></a><var>25.26</var>    (c) Agricultural land as used in this section means contiguous acreage of ten acres or <br/>
<a id="pl.25.27"></a><var>25.27</var>more, used during the preceding year for agricultural purposes. "Agricultural purposes" as <br/>
<a id="pl.25.28"></a><var>25.28</var>used in this section means the raising or cultivation of agricultural products. "Agricultural <br/>
<a id="pl.25.29"></a><var>25.29</var>purposes" also includes enrollment in the Reinvest in Minnesota program under sections <br/>
<statute_ref><a id="pl.25.30"></a><var>25.30</var>103F.501
         </statute_ref> to 
         <statute_ref>103F.535</statute_ref> or the federal Conservation Reserve Program as contained in Public <br/>
<a id="pl.25.31"></a><var>25.31</var>Law 99-198 if the property was classified as agricultural (i) under this subdivision for <br/>
<a id="pl.25.32"></a><var>25.32</var>the assessment year 2002 or (ii) in the year prior to its enrollment. Contiguous acreage <br/>
<a id="pl.25.33"></a><var>25.33</var>on the same parcel, or contiguous acreage on an immediately adjacent parcel under the <br/>
<a id="pl.25.34"></a><var>25.34</var>same ownership, may also qualify as agricultural land, but only if it is pasture, timber, <br/>
<a id="pl.25.35"></a><var>25.35</var>waste, unusable wild land, or land included in state or federal farm programs. Agricultural <br/>
<a id="pl.25.36"></a><var>25.36</var>classification for property shall be determined excluding the house, garage, and <br/>
<a id="pl.26.1"></a><var>26.1</var>immediately surrounding one acre of land, and shall not be based upon the market value of <br/>
<a id="pl.26.2"></a><var>26.2</var>any residential structures on the parcel or contiguous parcels under the same ownership. <br/>
<a id="pl.26.3"></a><var>26.3</var>    (d) Real estate, excluding the house, garage, and immediately surrounding one acre <br/>
<a id="pl.26.4"></a><var>26.4</var>of land, of less than ten acres which is exclusively and intensively used for raising or <br/>
<a id="pl.26.5"></a><var>26.5</var>cultivating agricultural products, shall be considered as agricultural land.<br/>
<a id="pl.26.6"></a><var>26.6</var>    Land shall be classified as agricultural even if all or a portion of the agricultural use <br/>
<a id="pl.26.7"></a><var>26.7</var>of that property is the leasing to, or use by another person for agricultural purposes.<br/>
<a id="pl.26.8"></a><var>26.8</var>    Classification under this subdivision is not determinative for qualifying under <br/>
<a id="pl.26.9"></a><var>26.9</var>section 
         <statute_ref>273.111</statute_ref>. <br/>
<a id="pl.26.10"></a><var>26.10</var>    The property classification under this section supersedes, for property tax purposes <br/>
<a id="pl.26.11"></a><var>26.11</var>only, any locally administered agricultural policies or land use restrictions that define <br/>
<a id="pl.26.12"></a><var>26.12</var>minimum or maximum farm acreage.<br/>
<a id="pl.26.13"></a><var>26.13</var>    (e) The term "agricultural products" as used in this subdivision includes production <br/>
<a id="pl.26.14"></a><var>26.14</var>for sale of:<br/>
<a id="pl.26.15"></a><var>26.15</var>    (1) livestock, dairy animals, dairy products, poultry and poultry products, fur-bearing <br/>
<a id="pl.26.16"></a><var>26.16</var>animals, horticultural and nursery stock, fruit of all kinds, vegetables, forage, grains, <br/>
<a id="pl.26.17"></a><var>26.17</var>bees, and apiary products by the owner;<br/>
<a id="pl.26.18"></a><var>26.18</var>    (2) fish bred for sale and consumption if the fish breeding occurs on land zoned <br/>
<a id="pl.26.19"></a><var>26.19</var>for agricultural use;<br/>
<a id="pl.26.20"></a><var>26.20</var>    (3) the commercial boarding of horses if the boarding is done in conjunction with <br/>
<a id="pl.26.21"></a><var>26.21</var>raising or cultivating agricultural products as defined in clause (1);<br/>
<a id="pl.26.22"></a><var>26.22</var>    (4) property which is owned and operated by nonprofit organizations used for <br/>
<a id="pl.26.23"></a><var>26.23</var>equestrian activities, excluding racing;<br/>
<a id="pl.26.24"></a><var>26.24</var>    (5) game birds and waterfowl bred and raised for use on a shooting preserve licensed <br/>
<a id="pl.26.25"></a><var>26.25</var>under section 
         <statute_ref>97A.115</statute_ref>; <br/>
<a id="pl.26.26"></a><var>26.26</var>    (6) insects primarily bred to be used as food for animals;<br/>
<a id="pl.26.27"></a><var>26.27</var>    (7) trees, grown for sale as a crop, and not sold for timber, lumber, wood, or wood <br/>
<a id="pl.26.28"></a><var>26.28</var>products; and<br/>
<a id="pl.26.29"></a><var>26.29</var>    (8) maple syrup taken from trees grown by a person licensed by the Minnesota <br/>
<a id="pl.26.30"></a><var>26.30</var>Department of Agriculture under chapter 28A as a food processor.<br/>
<a id="pl.26.31"></a><var>26.31</var>    (f) If a parcel used for agricultural purposes is also used for commercial or industrial <br/>
<a id="pl.26.32"></a><var>26.32</var>purposes, including but not limited to:<br/>
<a id="pl.26.33"></a><var>26.33</var>    (1) wholesale and retail sales;<br/>
<a id="pl.26.34"></a><var>26.34</var>    (2) processing of raw agricultural products or other goods;<br/>
<a id="pl.26.35"></a><var>26.35</var>    (3) warehousing or storage of processed goods; and<br/>
<a id="pl.27.1"></a><var>27.1</var>    (4) office facilities for the support of the activities enumerated in clauses (1), (2), <br/>
<a id="pl.27.2"></a><var>27.2</var>and (3),<br/>
<a id="pl.27.3"></a><var>27.3</var>the assessor shall classify the part of the parcel used for agricultural purposes as class <br/>
<a id="pl.27.4"></a><var>27.4</var>1b, 2a, or 2b, whichever is appropriate, and the remainder in the class appropriate to its <br/>
<a id="pl.27.5"></a><var>27.5</var>use. The grading, sorting, and packaging of raw agricultural products for first sale is <br/>
<a id="pl.27.6"></a><var>27.6</var>considered an agricultural purpose. A greenhouse or other building where horticultural <br/>
<a id="pl.27.7"></a><var>27.7</var>or nursery products are grown that is also used for the conduct of retail sales must be <br/>
<a id="pl.27.8"></a><var>27.8</var>classified as agricultural if it is primarily used for the growing of horticultural or nursery <br/>
<a id="pl.27.9"></a><var>27.9</var>products from seed, cuttings, or roots and occasionally as a showroom for the retail sale of <br/>
<a id="pl.27.10"></a><var>27.10</var>those products. Use of a greenhouse or building only for the display of already grown <br/>
<a id="pl.27.11"></a><var>27.11</var>horticultural or nursery products does not qualify as an agricultural purpose.<br/>
<a id="pl.27.12"></a><var>27.12</var>    The assessor shall determine and list separately on the records the market value of <br/>
<a id="pl.27.13"></a><var>27.13</var>the homestead dwelling and the one acre of land on which that dwelling is located. If any <br/>
<a id="pl.27.14"></a><var>27.14</var>farm buildings or structures are located on this homesteaded acre of land, their market <br/>
<a id="pl.27.15"></a><var>27.15</var>value shall not be included in this separate determination.<br/>
<a id="pl.27.16"></a><var>27.16</var>    (g) To qualify for classification under paragraph (b), clause (4), a privately owned <br/>
<a id="pl.27.17"></a><var>27.17</var>public use airport must be licensed as a public airport under section 
         <statute_ref>360.018</statute_ref>. For purposes <br/>
<a id="pl.27.18"></a><var>27.18</var>of paragraph (b), clause (4), "landing area" means that part of a privately owned public use <br/>
<a id="pl.27.19"></a><var>27.19</var>airport properly cleared, regularly maintained, and made available to the public for use by <br/>
<a id="pl.27.20"></a><var>27.20</var>aircraft and includes runways, taxiways, aprons, and sites upon which are situated landing <br/>
<a id="pl.27.21"></a><var>27.21</var>or navigational aids. A landing area also includes land underlying both the primary surface <br/>
<a id="pl.27.22"></a><var>27.22</var>and the approach surfaces that comply with all of the following: <br/>
<a id="pl.27.23"></a><var>27.23</var>    (i) the land is properly cleared and regularly maintained for the primary purposes of <br/>
<a id="pl.27.24"></a><var>27.24</var>the landing, taking off, and taxiing of aircraft; but that portion of the land that contains <br/>
<a id="pl.27.25"></a><var>27.25</var>facilities for servicing, repair, or maintenance of aircraft is not included as a landing area;<br/>
<a id="pl.27.26"></a><var>27.26</var>    (ii) the land is part of the airport property; and<br/>
<a id="pl.27.27"></a><var>27.27</var>    (iii) the land is not used for commercial or residential purposes.<br/>
<a id="pl.27.28"></a><var>27.28</var>The land contained in a landing area under paragraph (b), clause (4), must be described <br/>
<a id="pl.27.29"></a><var>27.29</var>and certified by the commissioner of transportation. The certification is effective until <br/>
<a id="pl.27.30"></a><var>27.30</var>it is modified, or until the airport or landing area no longer meets the requirements of <br/>
<a id="pl.27.31"></a><var>27.31</var>paragraph (b), clause (4). For purposes of paragraph (b), clause (4), "public access area" <br/>
<a id="pl.27.32"></a><var>27.32</var>means property used as an aircraft parking ramp, apron, or storage hangar, or an arrival <br/>
<a id="pl.27.33"></a><var>27.33</var>and departure building in connection with the airport.<br/>
<a id="pl.27.34"></a><var>27.34</var><b>EFFECTIVE DATE.</b>This section is effective for taxes payable in 2009 and <br/>
<a id="pl.27.35"></a><var>27.35</var>thereafter.<br/>
<br/>
<a id="bill.2.13.0"></a><a id="pl.28.1"></a><var>28.1</var>    Sec. 13. Minnesota Statutes 2006, section 273.13, subdivision 25, is amended to read:<br/>
<a id="pl.28.2"></a><var>28.2</var>    Subd. 25. <b>Class 4.</b> (a) Class 4a is residential real estate containing four or more <br/>
<a id="pl.28.3"></a><var>28.3</var>units and used or held for use by the owner or by the tenants or lessees of the owner <br/>
<a id="pl.28.4"></a><var>28.4</var>as a residence for rental periods of 30 days or more, excluding property qualifying for <br/>
<a id="pl.28.5"></a><var>28.5</var>class 4d. Class 4a also includes hospitals licensed under sections 
         <statute_ref>144.50</statute_ref> to 
         <statute_ref>144.56</statute_ref>, other <br/>
<a id="pl.28.6"></a><var>28.6</var>than hospitals exempt under section 
         <statute_ref>272.02</statute_ref>, and contiguous property used for hospital <br/>
<a id="pl.28.7"></a><var>28.7</var>purposes, without regard to whether the property has been platted or subdivided. The <br/>
<a id="pl.28.8"></a><var>28.8</var>market value of class 4a property has a class rate of 1.25 percent.<br/>
<a id="pl.28.9"></a><var>28.9</var>    (b) Class 4b includes:<br/>
<a id="pl.28.10"></a><var>28.10</var>    (1) residential real estate containing less than four units that does not qualify as class <br/>
<a id="pl.28.11"></a><var>28.11</var>4bb, other than seasonal residential recreational property;<br/>
<a id="pl.28.12"></a><var>28.12</var>    (2) manufactured homes not classified under any other provision;<br/>
<a id="pl.28.13"></a><var>28.13</var>    (3) a dwelling, garage, and surrounding one acre of property on a nonhomestead <br/>
<a id="pl.28.14"></a><var>28.14</var>farm classified under subdivision 23, paragraph (b) containing two or three units; and<br/>
<a id="pl.28.15"></a><var>28.15</var>    (4) unimproved property that is classified residential as determined under subdivision <br/>
<a id="pl.28.16"></a><var>28.16</var>33.<br/>
<a id="pl.28.17"></a><var>28.17</var>    The market value of class 4b property has a class rate of 1.25 percent.<br/>
<a id="pl.28.18"></a><var>28.18</var>    (c) Class 4bb includes:<br/>
<a id="pl.28.19"></a><var>28.19</var>    (1) nonhomestead residential real estate containing one unit, other than seasonal <br/>
<a id="pl.28.20"></a><var>28.20</var>residential recreational property; and<br/>
<a id="pl.28.21"></a><var>28.21</var>    (2) a single family dwelling, garage, and surrounding one acre of property on a <br/>
<a id="pl.28.22"></a><var>28.22</var>nonhomestead farm classified under subdivision 23, paragraph (b).<br/>
<a id="pl.28.23"></a><var>28.23</var>    Class 4bb property has the same class rates as class 1a property under subdivision 22.<br/>
<a id="pl.28.24"></a><var>28.24</var>    Property that has been classified as seasonal residential recreational property at <br/>
<a id="pl.28.25"></a><var>28.25</var>any time during which it has been owned by the current owner or spouse of the current <br/>
<a id="pl.28.26"></a><var>28.26</var>owner does not qualify for class 4bb.<br/>
<a id="pl.28.27"></a><var>28.27</var>    (d) Class 4c property includes:<br/>
<a id="pl.28.28"></a><var>28.28</var>    (1) except as provided in subdivision 22, paragraph (c), or subdivision 23, paragraph <br/>
<a id="pl.28.29"></a><var>28.29</var>(b), clause (1), real and personal property devoted to temporary and seasonal residential <br/>
<a id="pl.28.30"></a><var>28.30</var>occupancy for recreation purposes, including real and personal property devoted to <br/>
<a id="pl.28.31"></a><var>28.31</var>temporary and seasonal residential occupancy for recreation purposes and not devoted to <br/>
<a id="pl.28.32"></a><var>28.32</var>commercial purposes for more than 250 days in the year preceding the year of assessment. <br/>
<a id="pl.28.33"></a><var>28.33</var>For purposes of this clause, property is devoted to a commercial purpose on a specific <br/>
<a id="pl.28.34"></a><var>28.34</var>day if any portion of the property is used for residential occupancy, and a fee is charged <br/>
<a id="pl.28.35"></a><var>28.35</var>for residential occupancy. Class 4c property must contain three or more rental units. A <br/>
<a id="pl.28.36"></a><var>28.36</var>"rental unit" is defined as a cabin, condominium, townhouse, sleeping room, or individual <br/>
<a id="pl.29.1"></a><var>29.1</var>camping site equipped with water and electrical hookups for recreational vehicles. Class <br/>
<a id="pl.29.2"></a><var>29.2</var>4c property must provide recreational activities such as renting ice fishing houses, boats <br/>
<a id="pl.29.3"></a><var>29.3</var>and motors, snowmobiles, downhill or cross-country ski equipment; provide marina <br/>
<a id="pl.29.4"></a><var>29.4</var>services, launch services, or guide services; or sell bait and fishing tackle. A camping <br/>
<a id="pl.29.5"></a><var>29.5</var>pad offered for rent by a property that otherwise qualifies for class 4c is also class 4c <br/>
<a id="pl.29.6"></a><var>29.6</var>regardless of the term of the rental agreement, as long as the use of the camping pad <br/>
<a id="pl.29.7"></a><var>29.7</var>does not exceed 250 days. In order for a property to be classified as class 4c, seasonal <br/>
<a id="pl.29.8"></a><var>29.8</var>residential recreational for commercial purposes, at least 40 percent of the annual gross <br/>
<a id="pl.29.9"></a><var>29.9</var>lodging receipts related to the property must be from business conducted during 90 <br/>
<a id="pl.29.10"></a><var>29.10</var>consecutive days and either (i) at least 60 percent of all paid bookings by lodging guests <br/>
<a id="pl.29.11"></a><var>29.11</var>during the year must be for periods of at least two consecutive nights; or (ii) at least 20 <br/>
<a id="pl.29.12"></a><var>29.12</var>percent of the annual gross receipts must be from charges for rental of fish houses, boats <br/>
<a id="pl.29.13"></a><var>29.13</var>and motors, snowmobiles, downhill or cross-country ski equipment, or charges for marina <br/>
<a id="pl.29.14"></a><var>29.14</var>services, launch services, and guide services, or the sale of bait and fishing tackle. For <br/>
<a id="pl.29.15"></a><var>29.15</var>purposes of this determination, a paid booking of five or more nights shall be counted as <br/>
<a id="pl.29.16"></a><var>29.16</var>two bookings. Class 4c also includes commercial use real property used exclusively <br/>
<a id="pl.29.17"></a><var>29.17</var>for recreational purposes in conjunction with class 4c property devoted to temporary <br/>
<a id="pl.29.18"></a><var>29.18</var>and seasonal residential occupancy for recreational purposes, up to a total of two acres, <br/>
<a id="pl.29.19"></a><var>29.19</var>provided the property is not devoted to commercial recreational use for more than 250 <br/>
<a id="pl.29.20"></a><var>29.20</var>days in the year preceding the year of assessment and is located within two miles of the <br/>
<a id="pl.29.21"></a><var>29.21</var>class 4c property with which it is used. Owners of real and personal property devoted to <br/>
<a id="pl.29.22"></a><var>29.22</var>temporary and seasonal residential occupancy for recreation purposes and all or a portion <br/>
<a id="pl.29.23"></a><var>29.23</var>of which was devoted to commercial purposes for not more than 250 days in the year <br/>
<a id="pl.29.24"></a><var>29.24</var>preceding the year of assessment desiring classification as class 1c or 4c, must submit a <br/>
<a id="pl.29.25"></a><var>29.25</var>declaration to the assessor designating the cabins or units occupied for 250 days or less in <br/>
<a id="pl.29.26"></a><var>29.26</var>the year preceding the year of assessment by January 15 of the assessment year. Those <br/>
<a id="pl.29.27"></a><var>29.27</var>cabins or units and a proportionate share of the land on which they are located will must be <br/>
<a id="pl.29.28"></a><var>29.28</var>designated class 1c or 4c as otherwise provided. The remainder of the cabins or units and <br/>
<a id="pl.29.29"></a><var>29.29</var>a proportionate share of the land on which they are located will be designated as class 3a. <br/>
<a id="pl.29.30"></a><var>29.30</var>The owner of property desiring designation as class 1c or 4c property must provide guest <br/>
<a id="pl.29.31"></a><var>29.31</var>registers or other records demonstrating that the units for which class 1c or 4c designation <br/>
<a id="pl.29.32"></a><var>29.32</var>is sought were not occupied for more than 250 days in the year preceding the assessment if <br/>
<a id="pl.29.33"></a><var>29.33</var>so requested. The portion of a property operated as a (1) restaurant, (2) bar, (3) gift shop, <br/>
<a id="pl.29.34"></a><var>29.34</var>(4) conference center or meeting room, and (4) (5) other nonresidential facility operated <br/>
<a id="pl.29.35"></a><var>29.35</var>on a commercial basis not directly related to temporary and seasonal residential occupancy <br/>
<a id="pl.29.36"></a><var>29.36</var>for recreation purposes shall does not qualify for class 1c or 4c;<br/>
<a id="pl.30.1"></a><var>30.1</var>    (2) qualified property used as a golf course if:<br/>
<a id="pl.30.2"></a><var>30.2</var>    (i) it is open to the public on a daily fee basis. It may charge membership fees or <br/>
<a id="pl.30.3"></a><var>30.3</var>dues, but a membership fee may not be required in order to use the property for golfing, <br/>
<a id="pl.30.4"></a><var>30.4</var>and its green fees for golfing must be comparable to green fees typically charged by <br/>
<a id="pl.30.5"></a><var>30.5</var>municipal courses; and<br/>
<a id="pl.30.6"></a><var>30.6</var>    (ii) it meets the requirements of section 
         <statute_ref>273.112, subdivision 3</statute_ref>, paragraph (d).<br/>
<a id="pl.30.7"></a><var>30.7</var>    A structure used as a clubhouse, restaurant, or place of refreshment in conjunction <br/>
<a id="pl.30.8"></a><var>30.8</var>with the golf course is classified as class 3a property;<br/>
<a id="pl.30.9"></a><var>30.9</var>    (3) real property up to a maximum of one acre three acres of land owned and used <br/>
<a id="pl.30.10"></a><var>30.10</var>by a nonprofit community service oriented organization; provided that and that is not used <br/>
<a id="pl.30.11"></a><var>30.11</var>for residential purposes on either a temporary or permanent basis, qualifies for class 4c <br/>
<a id="pl.30.12"></a><var>30.12</var>provided that it meets either of the following:<br/>
<a id="pl.30.13"></a><var>30.13</var>    (i) the property is not used for a revenue-producing activity for more than six days <br/>
<a id="pl.30.14"></a><var>30.14</var>in the calendar year preceding the year of assessment and the property is not used for <br/>
<a id="pl.30.15"></a><var>30.15</var>residential purposes on either a temporary or permanent basis; or<br/>
<a id="pl.30.16"></a><var>30.16</var>    (ii) the organization makes annual charitable contributions and donations at least <br/>
<a id="pl.30.17"></a><var>30.17</var>equal to the property's previous year's property taxes and the property is allowed to be <br/>
<a id="pl.30.18"></a><var>30.18</var>used for public and community meetings or events for no charge, as appropriate to the <br/>
<a id="pl.30.19"></a><var>30.19</var>size of the facility. <br/>
<a id="pl.30.20"></a><var>30.20</var>    For purposes of this clause, <br/>
<a id="pl.30.21"></a><var>30.21</var>    (A) "charitable contributions and donations" has the same meaning as lawful <br/>
<a id="pl.30.22"></a><var>30.22</var>gambling purposes under section 349.12, subdivision 25, excluding those purposes <br/>
<a id="pl.30.23"></a><var>30.23</var>relating to the payment of taxes, assessments, fees, auditing costs, and utility payments;<br/>
<a id="pl.30.24"></a><var>30.24</var>    (B) "property taxes" excludes the state general tax;<br/>
<a id="pl.30.25"></a><var>30.25</var>    (C) a "nonprofit community service oriented organization" means any corporation, <br/>
<a id="pl.30.26"></a><var>30.26</var>society, association, foundation, or institution organized and operated exclusively for <br/>
<a id="pl.30.27"></a><var>30.27</var>charitable, religious, fraternal, civic, or educational purposes, and which is exempt from <br/>
<a id="pl.30.28"></a><var>30.28</var>federal income taxation pursuant to section 501(c)(3), (10), or (19) of the Internal Revenue <br/>
<a id="pl.30.29"></a><var>30.29</var>Code of 1986, as amended through December 31, 1990. For purposes of this clause,; and<br/>
<a id="pl.30.30"></a><var>30.30</var>    (D) "revenue-producing activities" shall include but not be limited to property or that <br/>
<a id="pl.30.31"></a><var>30.31</var>portion of the property that is used as an on-sale intoxicating liquor or 3.2 percent malt <br/>
<a id="pl.30.32"></a><var>30.32</var>liquor establishment licensed under chapter 340A, a restaurant open to the public, bowling <br/>
<a id="pl.30.33"></a><var>30.33</var>alley, a retail store, gambling conducted by organizations licensed under chapter 349, an <br/>
<a id="pl.30.34"></a><var>30.34</var>insurance business, or office or other space leased or rented to a lessee who conducts a <br/>
<a id="pl.30.35"></a><var>30.35</var>for-profit enterprise on the premises. <br/>
<a id="pl.31.1"></a><var>31.1</var>Any portion of the property qualifying under item (i) which is used for revenue-producing <br/>
<a id="pl.31.2"></a><var>31.2</var>activities for more than six days in the calendar year preceding the year of assessment <br/>
<a id="pl.31.3"></a><var>31.3</var>shall be assessed as class 3a. The use of the property for social events open exclusively <br/>
<a id="pl.31.4"></a><var>31.4</var>to members and their guests for periods of less than 24 hours, when an admission is <br/>
<a id="pl.31.5"></a><var>31.5</var>not charged nor any revenues are received by the organization shall not be considered a <br/>
<a id="pl.31.6"></a><var>31.6</var>revenue-producing activity;.<br/>
<a id="pl.31.7"></a><var>31.7</var>    The organization shall maintain records of its charitable contributions and donations <br/>
<a id="pl.31.8"></a><var>31.8</var>and of public meetings and events held on the property and make them available upon <br/>
<a id="pl.31.9"></a><var>31.9</var>request any time to the assessor to ensure eligibility. An organization meeting the <br/>
<a id="pl.31.10"></a><var>31.10</var>requirement under item (ii) must file an application by May 1 with the assessor for <br/>
<a id="pl.31.11"></a><var>31.11</var>eligibility for the current year's assessment. The commissioner shall prescribe a uniform <br/>
<a id="pl.31.12"></a><var>31.12</var>application form and instructions;<br/>
<a id="pl.31.13"></a><var>31.13</var>    (4) postsecondary student housing of not more than one acre of land that is owned by <br/>
<a id="pl.31.14"></a><var>31.14</var>a nonprofit corporation organized under chapter 317A and is used exclusively by a student <br/>
<a id="pl.31.15"></a><var>31.15</var>cooperative, sorority, or fraternity for on-campus housing or housing located within two <br/>
<a id="pl.31.16"></a><var>31.16</var>miles of the border of a college campus;<br/>
<a id="pl.31.17"></a><var>31.17</var>    (5) manufactured home parks as defined in section 
         <statute_ref>327.14, subdivision 3</statute_ref>;<br/>
<a id="pl.31.18"></a><var>31.18</var>    (6) real property that is actively and exclusively devoted to indoor fitness, health, <br/>
<a id="pl.31.19"></a><var>31.19</var>social, recreational, and related uses, is owned and operated by a not-for-profit corporation, <br/>
<a id="pl.31.20"></a><var>31.20</var>and is located within the metropolitan area as defined in section 
         <statute_ref>473.121, subdivision 2</statute_ref>;<br/>
<a id="pl.31.21"></a><var>31.21</var>    (7) a leased or privately owned noncommercial aircraft storage hangar not exempt <br/>
<a id="pl.31.22"></a><var>31.22</var>under section 
         <statute_ref>272.01, subdivision 2</statute_ref>, and the land on which it is located, provided that:<br/>
<a id="pl.31.23"></a><var>31.23</var>    (i) the land is on an airport owned or operated by a city, town, county, Metropolitan <br/>
<a id="pl.31.24"></a><var>31.24</var>Airports Commission, or group thereof; and<br/>
<a id="pl.31.25"></a><var>31.25</var>    (ii) the land lease, or any ordinance or signed agreement restricting the use of the <br/>
<a id="pl.31.26"></a><var>31.26</var>leased premise, prohibits commercial activity performed at the hangar.<br/>
<a id="pl.31.27"></a><var>31.27</var>    If a hangar classified under this clause is sold after June 30, 2000, a bill of sale must <br/>
<a id="pl.31.28"></a><var>31.28</var>be filed by the new owner with the assessor of the county where the property is located <br/>
<a id="pl.31.29"></a><var>31.29</var>within 60 days of the sale;<br/>
<a id="pl.31.30"></a><var>31.30</var>    (8) a privately owned noncommercial aircraft storage hangar not exempt under <br/>
<a id="pl.31.31"></a><var>31.31</var>section 
         <statute_ref>272.01, subdivision 2</statute_ref>, and the land on which it is located, provided that:<br/>
<a id="pl.31.32"></a><var>31.32</var>    (i) the land abuts a public airport; and<br/>
<a id="pl.31.33"></a><var>31.33</var>    (ii) the owner of the aircraft storage hangar provides the assessor with a signed <br/>
<a id="pl.31.34"></a><var>31.34</var>agreement restricting the use of the premises, prohibiting commercial use or activity <br/>
<a id="pl.31.35"></a><var>31.35</var>performed at the hangar; and<br/>
<a id="pl.32.1"></a><var>32.1</var>    (9) residential real estate, a portion of which is used by the owner for homestead <br/>
<a id="pl.32.2"></a><var>32.2</var>purposes, and that is also a place of lodging, if all of the following criteria are met:<br/>
<a id="pl.32.3"></a><var>32.3</var>    (i) rooms are provided for rent to transient guests that generally stay for periods <br/>
<a id="pl.32.4"></a><var>32.4</var>of 14 or fewer days;<br/>
<a id="pl.32.5"></a><var>32.5</var>    (ii) meals are provided to persons who rent rooms, the cost of which is incorporated <br/>
<a id="pl.32.6"></a><var>32.6</var>in the basic room rate;<br/>
<a id="pl.32.7"></a><var>32.7</var>    (iii) meals are not provided to the general public except for special events on fewer <br/>
<a id="pl.32.8"></a><var>32.8</var>than seven days in the calendar year preceding the year of the assessment; and<br/>
<a id="pl.32.9"></a><var>32.9</var>    (iv) the owner is the operator of the property.<br/>
<a id="pl.32.10"></a><var>32.10</var>The market value subject to the 4c classification under this clause is limited to five rental <br/>
<a id="pl.32.11"></a><var>32.11</var>units. Any rental units on the property in excess of five, must be valued and assessed as <br/>
<a id="pl.32.12"></a><var>32.12</var>class 3a. The portion of the property used for purposes of a homestead by the owner must <br/>
<a id="pl.32.13"></a><var>32.13</var>be classified as class 1a property under subdivision 22.<br/>
<a id="pl.32.14"></a><var>32.14</var>    Class 4c property has a class rate of 1.5 percent of market value, except that (i) each <br/>
<a id="pl.32.15"></a><var>32.15</var>parcel of seasonal residential recreational property not used for commercial purposes has <br/>
<a id="pl.32.16"></a><var>32.16</var>the same class rates as class 4bb property, (ii) manufactured home parks assessed under <br/>
<a id="pl.32.17"></a><var>32.17</var>clause (5) have the same class rate as class 4b property, (iii) commercial-use seasonal <br/>
<a id="pl.32.18"></a><var>32.18</var>residential recreational property has a class rate of one percent for the first $500,000 of <br/>
<a id="pl.32.19"></a><var>32.19</var>market value, and 1.25 percent for the remaining market value, (iv) the market value of <br/>
<a id="pl.32.20"></a><var>32.20</var>property described in clause (4) has a class rate of one percent, (v) the market value of <br/>
<a id="pl.32.21"></a><var>32.21</var>property described in clauses (2) and (6) has a class rate of 1.25 percent, and (vi) that <br/>
<a id="pl.32.22"></a><var>32.22</var>portion of the market value of property in clause (9) qualifying for class 4c property <br/>
<a id="pl.32.23"></a><var>32.23</var>has a class rate of 1.25 percent.<br/>
<a id="pl.32.24"></a><var>32.24</var>    (e) Class 4d property is qualifying low-income rental housing certified to the assessor <br/>
<a id="pl.32.25"></a><var>32.25</var>by the Housing Finance Agency under section 
         <statute_ref>273.128, subdivision 3</statute_ref>. If only a portion <br/>
<a id="pl.32.26"></a><var>32.26</var>of the units in the building qualify as low-income rental housing units as certified under <br/>
<a id="pl.32.27"></a><var>32.27</var>section 
         <statute_ref>273.128, subdivision 3</statute_ref>, only the proportion of qualifying units to the total number <br/>
<a id="pl.32.28"></a><var>32.28</var>of units in the building qualify for class 4d. The remaining portion of the building shall be <br/>
<a id="pl.32.29"></a><var>32.29</var>classified by the assessor based upon its use. Class 4d also includes the same proportion of <br/>
<a id="pl.32.30"></a><var>32.30</var>land as the qualifying low-income rental housing units are to the total units in the building. <br/>
<a id="pl.32.31"></a><var>32.31</var>For all properties qualifying as class 4d, the market value determined by the assessor must <br/>
<a id="pl.32.32"></a><var>32.32</var>be based on the normal approach to value using normal unrestricted rents.<br/>
<a id="pl.32.33"></a><var>32.33</var>    Class 4d property has a class rate of 0.75 percent.<br/>
<a id="pl.32.34"></a><var>32.34</var><b>EFFECTIVE DATE.</b>The part of this section relating to class 4c resorts in <br/>
<a id="pl.32.35"></a><var>32.35</var>paragraph (d), clause (1), is effective for assessment year 2009 and thereafter, for taxes <br/>
<a id="pl.33.1"></a><var>33.1</var>payable in 2010 and thereafter. The part of this section relating to nonprofit community <br/>
<a id="pl.33.2"></a><var>33.2</var>service oriented organizations is effective for assessment year 2008 and thereafter, for <br/>
<a id="pl.33.3"></a><var>33.3</var>taxes payable in 2009 and thereafter, except that the application date in paragraph (d), <br/>
<a id="pl.33.4"></a><var>33.4</var>clause (3), item (ii), for the 2008 assessment is extended to September 1, 2008.<br/>
<br/>
<a id="bill.2.14.0"></a><a id="pl.33.5"></a><var>33.5</var>    Sec. 14. Minnesota Statutes 2006, section 273.13, is amended by adding a subdivision <br/>
<a id="pl.33.6"></a><var>33.6</var>to read:<br/>
<a id="pl.33.7"></a><var>33.7</var>    Subd. 34. <b>Homestead of disabled veteran.</b> (a) All or a portion of the market value <br/>
<a id="pl.33.8"></a><var>33.8</var>of property qualifying for homestead classification under subdivision 22 or 23 is excluded <br/>
<a id="pl.33.9"></a><var>33.9</var>in determining the property's taxable market value if it serves as the homestead of a <br/>
<a id="pl.33.10"></a><var>33.10</var>military veteran, as defined in section 197.447, who has a service-connected disability of <br/>
<a id="pl.33.11"></a><var>33.11</var>70 percent or more. To qualify for exclusion under this subdivision, the veteran must have <br/>
<a id="pl.33.12"></a><var>33.12</var>been honorably discharged from the United States armed forces, as indicated by United <br/>
<a id="pl.33.13"></a><var>33.13</var>States Government Form DD214 or other official military discharge papers, and must be <br/>
<a id="pl.33.14"></a><var>33.14</var>certified by the United States Veterans Administration as having a service-connected <br/>
<a id="pl.33.15"></a><var>33.15</var>disability.<br/>
<a id="pl.33.16"></a><var>33.16</var>    (b)(1) For a disability rating of 70 percent or more, $150,000 of market value is <br/>
<a id="pl.33.17"></a><var>33.17</var>excluded, except as provided in clause (2); and<br/>
<a id="pl.33.18"></a><var>33.18</var>    (2) for a total (100 percent) and permanent disability, $300,000 of market value is <br/>
<a id="pl.33.19"></a><var>33.19</var>excluded.<br/>
<a id="pl.33.20"></a><var>33.20</var>    (c) If a disabled veteran qualifying for a valuation exclusion under paragraph (b), <br/>
<a id="pl.33.21"></a><var>33.21</var>clause (2), predeceases the veteran's spouse, and if upon the death of the veteran the <br/>
<a id="pl.33.22"></a><var>33.22</var>spouse holds the legal or beneficial title to the homestead and permanently resides there, <br/>
<a id="pl.33.23"></a><var>33.23</var>the exclusion shall carry over to the benefit of the veteran's spouse until such time as the <br/>
<a id="pl.33.24"></a><var>33.24</var>spouse sells, transfers, or otherwise disposes of the property.<br/>
<a id="pl.33.25"></a><var>33.25</var>    (d) In the case of an agricultural homestead, only the portion of the property <br/>
<a id="pl.33.26"></a><var>33.26</var>consisting of the house and garage and immediately surrounding one acre of land qualifies <br/>
<a id="pl.33.27"></a><var>33.27</var>for the valuation exclusion under this subdivision.<br/>
<a id="pl.33.28"></a><var>33.28</var>    (e) A property qualifying for a valuation exclusion under this subdivision is not <br/>
<a id="pl.33.29"></a><var>33.29</var>eligible for the credit under section 273.1384, subdivision 1.<br/>
<a id="pl.33.30"></a><var>33.30</var>    (f) To qualify for a valuation exclusion under this subdivision a property owner must <br/>
<a id="pl.33.31"></a><var>33.31</var>apply to the assessor by July 1 of each assessment year, except that an annual reapplication <br/>
<a id="pl.33.32"></a><var>33.32</var>is not required once a property has been accepted for a valuation exclusion under paragraph <br/>
<a id="pl.33.33"></a><var>33.33</var>(b), clause (2), and the property continues to qualify until there is a change in ownership.<br/>
<a id="pl.33.34"></a><var>33.34</var><b>EFFECTIVE DATE.</b>This section is effective for assessment year 2008 and <br/>
<a id="pl.33.35"></a><var>33.35</var>thereafter, for taxes payable in 2009 and thereafter.<br/>
<br/>
<a id="bill.2.15.0"></a><a id="pl.34.1"></a><var>34.1</var>    Sec. 15. Minnesota Statutes 2006, section 273.1315, is amended to read:<br/>
<a id="pl.34.2"></a><var>34.2</var><b>273.1315 CERTIFICATION OF</b><b> CLASS</b><b> 1B PROPERTY.</b><br/>
<a id="pl.34.3"></a><var>34.3</var>    Subdivision 1. <b>Class 1b homestead declaration before 2009.</b> Any property owner <br/>
<a id="pl.34.4"></a><var>34.4</var>seeking classification and assessment of the owner's homestead as class 1b property <br/>
<a id="pl.34.5"></a><var>34.5</var>pursuant to section 
         <statute_ref>273.13, subdivision 22</statute_ref>, paragraph (b), on or before October 1, 2008, <br/>
<a id="pl.34.6"></a><var>34.6</var>shall file with the commissioner of revenue a 1b homestead declaration, on a form <br/>
<a id="pl.34.7"></a><var>34.7</var>prescribed by the commissioner. The declaration shall contain the following information:<br/>
<a id="pl.34.8"></a><var>34.8</var>    (a) the information necessary to verify that on or before June 30 of the filing year, <br/>
<a id="pl.34.9"></a><var>34.9</var>the property owner or the owner's spouse satisfies the requirements of section 
         <statute_ref>273.13, <br/>
<a id="pl.34.10"></a><var>34.10</var>subdivision 22
         </statute_ref>, paragraph (b), for 1b classification; and<br/>
<a id="pl.34.11"></a><var>34.11</var>    (b) any additional information prescribed by the commissioner.<br/>
<a id="pl.34.12"></a><var>34.12</var>    The declaration must be filed on or before October 1 to be effective for property <br/>
<a id="pl.34.13"></a><var>34.13</var>taxes payable during the succeeding calendar year. The declaration and any supplementary <br/>
<a id="pl.34.14"></a><var>34.14</var>information received from the property owner pursuant to this section subdivision shall <br/>
<a id="pl.34.15"></a><var>34.15</var>be subject to chapter 270B. If approved by the commissioner, the declaration remains <br/>
<a id="pl.34.16"></a><var>34.16</var>in effect until the property no longer qualifies under section 
         <statute_ref>273.13, subdivision 22</statute_ref>, <br/>
<a id="pl.34.17"></a><var>34.17</var>paragraph (b). Failure to notify the commissioner within 30 days that the property no <br/>
<a id="pl.34.18"></a><var>34.18</var>longer qualifies under that paragraph because of a sale, change in occupancy, or change <br/>
<a id="pl.34.19"></a><var>34.19</var>in the status or condition of an occupant shall result in the penalty provided in section <br/>
<statute_ref><a id="pl.34.20"></a><var>34.20</var>273.124, subdivision 13
         </statute_ref>, computed on the basis of the class 1b benefits for the property, <br/>
<a id="pl.34.21"></a><var>34.21</var>and the property shall lose its current class 1b classification.<br/>
<a id="pl.34.22"></a><var>34.22</var>    The commissioner shall provide to the assessor on or before November 1 a listing <br/>
<a id="pl.34.23"></a><var>34.23</var>of the parcels of property qualifying for 1b classification.<br/>
<a id="pl.34.24"></a><var>34.24</var>    Subd. 2. <b>Class 1b homestead declaration 2009 and thereafter.</b> (a) Any property <br/>
<a id="pl.34.25"></a><var>34.25</var>owner seeking classification and assessment of the owner's homestead as class 1b property <br/>
<a id="pl.34.26"></a><var>34.26</var>pursuant to section 273.13, subdivision 22, paragraph (b), after October 1, 2008, shall file <br/>
<a id="pl.34.27"></a><var>34.27</var>with the county assessor a class 1b homestead declaration, on a form prescribed by the <br/>
<a id="pl.34.28"></a><var>34.28</var>commissioner of revenue. The declaration must contain the following information:<br/>
<a id="pl.34.29"></a><var>34.29</var>    (1) the information necessary to verify that, on or before June 30 of the filing year, <br/>
<a id="pl.34.30"></a><var>34.30</var>the property owner or the owner's spouse satisfies the requirements of section 273.13, <br/>
<a id="pl.34.31"></a><var>34.31</var>subdivision 22, paragraph (b), for class 1b classification; and<br/>
<a id="pl.34.32"></a><var>34.32</var>    (2) any additional information prescribed by the commissioner.<br/>
<a id="pl.34.33"></a><var>34.33</var>    (b) The declaration must be filed on or before October 1 to be effective for property <br/>
<a id="pl.34.34"></a><var>34.34</var>taxes payable during the succeeding calendar year. The Social Security numbers and <br/>
<a id="pl.34.35"></a><var>34.35</var>income and medical information received from the property owner pursuant to this <br/>
<a id="pl.34.36"></a><var>34.36</var>subdivision are private data on individuals as defined in section 13.02. If approved by <br/>
<a id="pl.35.1"></a><var>35.1</var>the assessor, the declaration remains in effect until the property no longer qualifies under <br/>
<a id="pl.35.2"></a><var>35.2</var>section 273.13, subdivision 22, paragraph (b). Failure to notify the assessor within 30 <br/>
<a id="pl.35.3"></a><var>35.3</var>days that the property no longer qualifies under that paragraph because of a sale, change in <br/>
<a id="pl.35.4"></a><var>35.4</var>occupancy, or change in the status or condition of an occupant shall result in the penalty <br/>
<a id="pl.35.5"></a><var>35.5</var>provided in section 273.124, subdivision 13, computed on the basis of the class 1b benefits <br/>
<a id="pl.35.6"></a><var>35.6</var>for the property, and the property shall lose its current class 1b classification.<br/>
<a id="pl.35.7"></a><var>35.7</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.2.16.0"></a><a id="pl.35.8"></a><var>35.8</var>    Sec. 16. Minnesota Statutes 2006, section 275.025, subdivision 3, is amended to read:<br/>
<a id="pl.35.9"></a><var>35.9</var>    Subd. 3. <b>Seasonal residential recreational tax capacity.</b> For the purposes of this <br/>
<a id="pl.35.10"></a><var>35.10</var>section, "seasonal residential recreational tax capacity" means the tax capacity of tier III of <br/>
<a id="pl.35.11"></a><var>35.11</var>class 1c under section 
         <statute_ref>273.13, subdivision 22</statute_ref>, and all class 4c(1) and 4c(3)(ii) property <br/>
<a id="pl.35.12"></a><var>35.12</var>under section 
         <statute_ref>273.13, subdivision 25</statute_ref>, except that the first $76,000 of market value of each <br/>
<a id="pl.35.13"></a><var>35.13</var>noncommercial class 4c(1) property has a tax capacity for this purpose equal to 40 percent <br/>
<a id="pl.35.14"></a><var>35.14</var>of its tax capacity under section 
         <statute_ref>273.13</statute_ref>.<br/>
<a id="pl.35.15"></a><var>35.15</var><b>EFFECTIVE DATE.</b>This section is effective for taxes payable in 2009 and <br/>
<a id="pl.35.16"></a><var>35.16</var>thereafter.<br/>
<br/>
<a id="bill.2.17.0"></a><a id="pl.35.17"></a><var>35.17</var>    Sec. 17. Minnesota Statutes 2006, section 275.065, is amended by adding a subdivision <br/>
<a id="pl.35.18"></a><var>35.18</var>to read:<br/>
<a id="pl.35.19"></a><var>35.19</var>    Subd. 6c. <b>Joint public hearing; nonmetropolitan county, cities, and school </b><br/>
<a id="pl.35.20"></a><var>35.20</var><b>districts.</b> (a) Notwithstanding any other provision of law, the county board may hold a <br/>
<a id="pl.35.21"></a><var>35.21</var>joint hearing with the governing bodies of all taxing authorities located wholly or partially <br/>
<a id="pl.35.22"></a><var>35.22</var>within the county that are required to hold a public hearing under this section, excluding <br/>
<a id="pl.35.23"></a><var>35.23</var>special taxing districts. The primary purpose of the joint hearing is for taxpayer efficiency <br/>
<a id="pl.35.24"></a><var>35.24</var>by allowing taxpayers to come to a single public hearing to discuss the budgets and <br/>
<a id="pl.35.25"></a><var>35.25</var>proposed property tax levies of most taxing authorities that impact the taxes on their <br/>
<a id="pl.35.26"></a><var>35.26</var>property.<br/>
<a id="pl.35.27"></a><var>35.27</var>    (b) This subdivision applies only to counties located outside the metropolitan area <br/>
<a id="pl.35.28"></a><var>35.28</var>as defined under section 
<statute_ref>473.121</statute_ref>, subdivision 2. If a city or school district is located <br/>
<a id="pl.35.29"></a><var>35.29</var>partially within the metropolitan area, that taxing jurisdiction may participate in its <br/>
<a id="pl.35.30"></a><var>35.30</var>nonmetropolitan county's joint hearing, if it so chooses.<br/>
<a id="pl.35.31"></a><var>35.31</var>    (c) Upon the adoption of a resolution by the county board to hold a joint public <br/>
<a id="pl.35.32"></a><var>35.32</var>hearing, the county shall notify each city with a population over 500 and each school <br/>
<a id="pl.35.33"></a><var>35.33</var>district located wholly or partially within the county of its intention to hold the joint <br/>
<a id="pl.36.1"></a><var>36.1</var>hearing and ask each of the taxing authorities if it would like to participate. Participation <br/>
<a id="pl.36.2"></a><var>36.2</var>is voluntary, and participation in the joint hearing is in lieu of the requirement for the <br/>
<a id="pl.36.3"></a><var>36.3</var>governing body to hold a separate public hearing under subdivision 6. If a participating <br/>
<a id="pl.36.4"></a><var>36.4</var>city or school district is located in more than one county, the hearing under this subdivision <br/>
<a id="pl.36.5"></a><var>36.5</var>is in lieu of the requirement to hold a separate public hearing if 75 percent or more <br/>
<a id="pl.36.6"></a><var>36.6</var>of that city or school district's previous year's net tax capacity is in the county where <br/>
<a id="pl.36.7"></a><var>36.7</var>the hearing is held.<br/>
<a id="pl.36.8"></a><var>36.8</var>    (d) The initial joint hearing must be held on the first Thursday in December. The <br/>
<a id="pl.36.9"></a><var>36.9</var>county may hold an additional joint hearing on another date before December 20 if the <br/>
<a id="pl.36.10"></a><var>36.10</var>majority of the participating taxing authorities want an additional hearing.<br/>
<a id="pl.36.11"></a><var>36.11</var>    The county board shall obtain a meeting space to hold the joint hearing, preferably <br/>
<a id="pl.36.12"></a><var>36.12</var>at a public building such as the courthouse, school, or community center. The location <br/>
<a id="pl.36.13"></a><var>36.13</var>shall be as centrally located within the county as possible. The meeting shall generally be <br/>
<a id="pl.36.14"></a><var>36.14</var>structured in the following general manner:<br/>
<a id="pl.36.15"></a><var>36.15</var>    (1) 30 to 60 minutes must be devoted to discussion of the county's budget and levy;<br/>
<a id="pl.36.16"></a><var>36.16</var>    (2) 30 to 60 minutes must be devoted to discussion of the city's budget and levy, <br/>
<a id="pl.36.17"></a><var>36.17</var>with each city's discussion held in a separate room, preferably in the same building;<br/>
<a id="pl.36.18"></a><var>36.18</var>    (3) 30 to 60 minutes must be devoted to discussion of the school district's levy, <br/>
<a id="pl.36.19"></a><var>36.19</var>with each school district's discussion held in a separate room, preferably in the same <br/>
<a id="pl.36.20"></a><var>36.20</var>building; and<br/>
<a id="pl.36.21"></a><var>36.21</var>    (4) during the last 30 minutes the governing bodies must reassemble in a joint <br/>
<a id="pl.36.22"></a><var>36.22</var>meeting to entertain any follow-up questions that have arisen from the separate discussions.<br/>
<a id="pl.36.23"></a><var>36.23</var>    The county shall attempt to keep the total public hearing to within three hours.<br/>
<a id="pl.36.24"></a><var>36.24</var>    (e) In lieu of the public advertisement requirement in subdivision 5a, the county shall <br/>
<a id="pl.36.25"></a><var>36.25</var>have a single advertisement listing the county, each city with a population of over 500, and <br/>
<a id="pl.36.26"></a><var>36.26</var>each school district participating in the joint public hearing listing. Any taxing authority <br/>
<a id="pl.36.27"></a><var>36.27</var>participating under this subdivision is exempt from the separate public advertisement <br/>
<a id="pl.36.28"></a><var>36.28</var>requirement under subdivision 5a. The cost of the joint hearing advertisement shall be <br/>
<a id="pl.36.29"></a><var>36.29</var>apportioned in the same manner provided in subdivision 4. The notice must be published <br/>
<a id="pl.36.30"></a><var>36.30</var>not less than two business days nor more than six business days before the hearing. The <br/>
<a id="pl.36.31"></a><var>36.31</var>newspaper selected must be one of general interest and readership in the county, and not <br/>
<a id="pl.36.32"></a><var>36.32</var>one of limited subject matter. The advertisement must appear in a newspaper that is <br/>
<a id="pl.36.33"></a><var>36.33</var>published at least once per week. The advertisement must be in the following form:<br/>

<a id="pl.37.2"></a><var>37.2</var>property taxes in the county, cities, and school districts for (year) with the property <br/>
<a id="pl.37.3"></a><var>37.3</var>taxes the county, cities, and school districts propose to collect in (year) for those taxing <br/>
<a id="pl.37.4"></a><var>37.4</var>authorities participating in the joint public hearing.<br/>
<table>
<col width="50px"/>
<col width=""/>
<col width=""/>
<col width=""/>
<col width=""/>
<tr>
<td><a id="pl.37.5"></a><var>37.5</var><br/>
<a id="pl.37.6"></a><var>37.6</var><br/>
</td>
<td align="left" valign="bottom">Taxing Authority<br/>
</td>
<td align="left" valign="bottom">(Year) Property <br/>
Taxes<br/>
</td>
<td align="left" valign="bottom">Proposed (Year) <br/>
Property Taxes<br/>
</td>
<td align="left" valign="bottom">Change (Year) - <br/>
(Year)<br/>
</td>
</tr>
<tr>
<td><a id="pl.37.7"></a><var>37.7</var><br/>
</td>
<td align="left" valign="bottom">$.......<br/>
</td>
<td align="left" valign="bottom">$.......<br/>
</td>
<td align="left" valign="bottom">$.......<br/>
</td>
<td align="left" valign="bottom">...%<br/>
</td>
</tr>
<tr>
<td><a id="pl.37.8"></a><var>37.8</var><br/>
</td>
<td align="left" valign="bottom">$.......<br/>
</td>
<td align="left" valign="bottom">$.......<br/>
</td>
<td align="left" valign="bottom">$.......<br/>
</td>
<td align="left" valign="bottom">...%<br/>
</td>
</tr>
<tr>
<td><a id="pl.37.9"></a><var>37.9</var><br/>
</td>
<td align="left" valign="bottom">$.......<br/>
</td>
<td align="left" valign="bottom">$.......<br/>
</td>
<td align="left" valign="bottom">$.......<br/>
</td>
<td align="left" valign="bottom">...%<br/>
</td>
</tr>
</table>

<a id="pl.37.12"></a><var>37.12</var>districts to express your opinions on the proposed amount of (year) property taxes. The <br/>
<a id="pl.37.13"></a><var>37.13</var>hearing will be held on:<br/>

<a id="pl.37.17"></a><var>37.17</var>for that hearing will be announced at this hearing. You are also invited to send your <br/>
<a id="pl.37.18"></a><var>37.18</var>written comments to the county auditor. If the comments relate to the city or school <br/>
<a id="pl.37.19"></a><var>37.19</var>district's levy, please identify that on the envelope so the county auditor can direct the <br/>
<a id="pl.37.20"></a><var>37.20</var>correspondence to the right jurisdiction."<br/>
<a id="pl.37.21"></a><var>37.21</var>    The formal adoption of the taxing authority's levy must not be made at the joint <br/>
<a id="pl.37.22"></a><var>37.22</var>public hearing held under this subdivision. The formal adoption must be made at one of <br/>
<a id="pl.37.23"></a><var>37.23</var>the regularly scheduled meetings of the taxing authority's governing body. However, the <br/>
<a id="pl.37.24"></a><var>37.24</var>property tax levy amount that is subsequently adopted cannot exceed the amount shown to <br/>
<a id="pl.37.25"></a><var>37.25</var>taxpayers at the joint public hearing.<br/>
<a id="pl.37.26"></a><var>37.26</var><b>EFFECTIVE DATE.</b>This section is effective for hearings held in 2008 and <br/>
<a id="pl.37.27"></a><var>37.27</var>thereafter.<br/>
<br/>
<a id="bill.2.18.0"></a><a id="pl.37.28"></a><var>37.28</var>    Sec. 18. Minnesota Statutes 2006, section 275.066, is amended to read:<br/>
<a id="pl.37.29"></a><var>37.29</var><b>275.066 SPECIAL TAXING DISTRICTS; DEFINITION.</b><br/>
<a id="pl.37.30"></a><var>37.30</var>    For the purposes of property taxation and property tax state aids, the term "special <br/>
<a id="pl.37.31"></a><var>37.31</var>taxing districts" includes the following entities:<br/>
<a id="pl.37.32"></a><var>37.32</var>    (1) watershed districts under chapter 103D;<br/>
<a id="pl.37.33"></a><var>37.33</var>    (2) sanitary districts under sections 
         <statute_ref>115.18</statute_ref> to 
         <statute_ref>115.37</statute_ref>; <br/>
<a id="pl.37.34"></a><var>37.34</var>    (3) regional sanitary sewer districts under sections 
         <statute_ref>115.61</statute_ref> to 
         <statute_ref>115.67</statute_ref>; <br/>
<a id="pl.37.35"></a><var>37.35</var>    (4) regional public library districts under section 
         <statute_ref>134.201</statute_ref>; <br/>
<a id="pl.38.1"></a><var>38.1</var>    (5) park districts under chapter 398;<br/>
<a id="pl.38.2"></a><var>38.2</var>    (6) regional railroad authorities under chapter 398A;<br/>
<a id="pl.38.3"></a><var>38.3</var>    (7) hospital districts under sections 
         <statute_ref>447.31</statute_ref> to 
         <statute_ref>447.38</statute_ref>; <br/>
<a id="pl.38.4"></a><var>38.4</var>    (8) St. Cloud Metropolitan Transit Commission under sections 
         <statute_ref>458A.01</statute_ref> to 
         <statute_ref>458A.15</statute_ref>; <br/>
<a id="pl.38.5"></a><var>38.5</var>    (9) Duluth Transit Authority under sections 
         <statute_ref>458A.21</statute_ref> to 
         <statute_ref>458A.37</statute_ref>; <br/>
<a id="pl.38.6"></a><var>38.6</var>    (10) regional development commissions under sections 
         <statute_ref>462.381</statute_ref> to 
         <statute_ref>462.398</statute_ref>; <br/>
<a id="pl.38.7"></a><var>38.7</var>    (11) housing and redevelopment authorities under sections 
         <statute_ref>469.001</statute_ref> to 
         <statute_ref>469.047</statute_ref>; <br/>
<a id="pl.38.8"></a><var>38.8</var>    (12) port authorities under sections 
         <statute_ref>469.048</statute_ref> to 
         <statute_ref>469.068</statute_ref>; <br/>
<a id="pl.38.9"></a><var>38.9</var>    (13) economic development authorities under sections 
         <statute_ref>469.090</statute_ref> to 
         <statute_ref>469.1081</statute_ref>; <br/>
<a id="pl.38.10"></a><var>38.10</var>    (14) Metropolitan Council under sections 
         <statute_ref>473.123</statute_ref> to 
         <statute_ref>473.549</statute_ref>; <br/>
<a id="pl.38.11"></a><var>38.11</var>    (15) Metropolitan Airports Commission under sections 
         <statute_ref>473.601</statute_ref> to 
         <statute_ref>473.680</statute_ref>; <br/>
<a id="pl.38.12"></a><var>38.12</var>    (16) Metropolitan Mosquito Control Commission under sections 
         <statute_ref>473.701</statute_ref> to 
         <statute_ref>473.716</statute_ref>; <br/>
<a id="pl.38.13"></a><var>38.13</var>    (17) Morrison County Rural Development Financing Authority under Laws 1982, <br/>
<a id="pl.38.14"></a><var>38.14</var>chapter 437, section 1;<br/>
<a id="pl.38.15"></a><var>38.15</var>    (18) Croft Historical Park District under Laws 1984, chapter 502, article 13, section <br/>
<a id="pl.38.16"></a><var>38.16</var>6;<br/>
<a id="pl.38.17"></a><var>38.17</var>    (19) East Lake County Medical Clinic District under Laws 1989, chapter 211, <br/>
<a id="pl.38.18"></a><var>38.18</var>sections 1 to 6;<br/>
<a id="pl.38.19"></a><var>38.19</var>    (20) Floodwood Area Ambulance District under Laws 1993, chapter 375, article <br/>
<a id="pl.38.20"></a><var>38.20</var>5, section 39;<br/>
<a id="pl.38.21"></a><var>38.21</var>    (21) Middle Mississippi River Watershed Management Organization under sections <br/>
<statute_ref><a id="pl.38.22"></a><var>38.22</var>103B.211
         </statute_ref> and 
         <statute_ref>103B.241</statute_ref>; <br/>
<a id="pl.38.23"></a><var>38.23</var>    (22) emergency medical services special taxing districts under section 
         <statute_ref>144F.01</statute_ref>; <br/>
<a id="pl.38.24"></a><var>38.24</var>    (23) a county levying under the authority of section 
         <statute_ref>103B.241</statute_ref>, 
         <statute_ref>103B.245</statute_ref>, or <br/>
<statute_ref><a id="pl.38.25"></a><var>38.25</var>103B.251
         </statute_ref>; <br/>
<a id="pl.38.26"></a><var>38.26</var>    (24) Southern St. Louis County Special Taxing District; Chris Jensen Nursing Home <br/>
<a id="pl.38.27"></a><var>38.27</var>under Laws 2003, First Special Session chapter 21, article 4, section 12; and<br/>
<a id="pl.38.28"></a><var>38.28</var>    (25) an airport authority created under section 360.0426; and<br/>
<a id="pl.38.29"></a><var>38.29</var>    (26) any other political subdivision of the state of Minnesota, excluding counties, <br/>
<a id="pl.38.30"></a><var>38.30</var>school districts, cities, and towns, that has the power to adopt and certify a property tax <br/>
<a id="pl.38.31"></a><var>38.31</var>levy to the county auditor, as determined by the commissioner of revenue.<br/>
<a id="pl.38.32"></a><var>38.32</var><b>EFFECTIVE DATE.</b>This section is effective for taxes payable in 2009, and <br/>
<a id="pl.38.33"></a><var>38.33</var>thereafter.<br/>
<br/>
<a id="bill.2.19.0"></a><a id="pl.38.34"></a><var>38.34</var>    Sec. 19. Minnesota Statutes 2006, section 276.04, subdivision 2, is amended to read:<br/>
<a id="pl.39.1"></a><var>39.1</var>    Subd. 2. <b>Contents of tax statements.</b> (a) The treasurer shall provide for the <br/>
<a id="pl.39.2"></a><var>39.2</var>printing of the tax statements. The commissioner of revenue shall prescribe the form <br/>
<a id="pl.39.3"></a><var>39.3</var>of the property tax statement and its contents. The statement must contain a tabulated <br/>
<a id="pl.39.4"></a><var>39.4</var>statement of the dollar amount due to each taxing authority and the amount of the state <br/>
<a id="pl.39.5"></a><var>39.5</var>tax from the parcel of real property for which a particular tax statement is prepared. The <br/>
<a id="pl.39.6"></a><var>39.6</var>dollar amounts attributable to the county, the state tax, the voter approved school tax, the <br/>
<a id="pl.39.7"></a><var>39.7</var>other local school tax, the township or municipality, and the total of the metropolitan <br/>
<a id="pl.39.8"></a><var>39.8</var>special taxing districts as defined in section 
         <statute_ref>275.065, subdivision 3</statute_ref>, paragraph (i), must <br/>
<a id="pl.39.9"></a><var>39.9</var>be separately stated. The amounts due all other special taxing districts, if any, may be <br/>
<a id="pl.39.10"></a><var>39.10</var>aggregated except that any levies made by the regional rail authorities in the county of <br/>
<a id="pl.39.11"></a><var>39.11</var>Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter 398A <br/>
<a id="pl.39.12"></a><var>39.12</var>shall be listed on a separate line directly under the appropriate county's levy. If the county <br/>
<a id="pl.39.13"></a><var>39.13</var>levy under this paragraph includes an amount for a lake improvement district as defined <br/>
<a id="pl.39.14"></a><var>39.14</var>under sections 
         <statute_ref>103B.501</statute_ref> to 
         <statute_ref>103B.581</statute_ref>, the amount attributable for that purpose must be <br/>
<a id="pl.39.15"></a><var>39.15</var>separately stated from the remaining county levy amount. In the case of Ramsey County, <br/>
<a id="pl.39.16"></a><var>39.16</var>if the county levy under this paragraph includes an amount for public library service <br/>
<a id="pl.39.17"></a><var>39.17</var>under section 
         <statute_ref>134.07</statute_ref>, the amount attributable for that purpose may be separated from the <br/>
<a id="pl.39.18"></a><var>39.18</var>remaining county levy amount. The amount of the tax on homesteads qualifying under the <br/>
<a id="pl.39.19"></a><var>39.19</var>senior citizens' property tax deferral program under chapter 290B is the total amount of <br/>
<a id="pl.39.20"></a><var>39.20</var>property tax before subtraction of the deferred property tax amount. The amount of the <br/>
<a id="pl.39.21"></a><var>39.21</var>tax on contamination value imposed under sections 
         <statute_ref>270.91</statute_ref> to 
         <statute_ref>270.98</statute_ref>, if any, must also <br/>
<a id="pl.39.22"></a><var>39.22</var>be separately stated. The dollar amounts, including the dollar amount of any special <br/>
<a id="pl.39.23"></a><var>39.23</var>assessments, may be rounded to the nearest even whole dollar. For purposes of this section <br/>
<a id="pl.39.24"></a><var>39.24</var>whole odd-numbered dollars may be adjusted to the next higher even-numbered dollar. <br/>
<a id="pl.39.25"></a><var>39.25</var>The amount of market value excluded under section 
         <statute_ref>273.11, subdivision 16</statute_ref>, if any, must <br/>
<a id="pl.39.26"></a><var>39.26</var>also be listed on the tax statement.<br/>
<a id="pl.39.27"></a><var>39.27</var>    (b) The property tax statements for manufactured homes and sectional structures <br/>
<a id="pl.39.28"></a><var>39.28</var>taxed as personal property shall contain the same information that is required on the <br/>
<a id="pl.39.29"></a><var>39.29</var>tax statements for real property.<br/>
<a id="pl.39.30"></a><var>39.30</var>    (c) Real and personal property tax statements must contain the following information <br/>
<a id="pl.39.31"></a><var>39.31</var>in the order given in this paragraph. The information must contain the current year tax <br/>
<a id="pl.39.32"></a><var>39.32</var>information in the right column with the corresponding information for the previous year <br/>
<a id="pl.39.33"></a><var>39.33</var>in a column on the left:<br/>
<a id="pl.39.34"></a><var>39.34</var>    (1) the property's estimated market value under section 
         <statute_ref>273.11, subdivision 1</statute_ref>;<br/>
<a id="pl.39.35"></a><var>39.35</var>    (2) the property's taxable market value after reductions under section 
         <statute_ref>273.11, <br/>
<a id="pl.39.36"></a><var>39.36</var>subdivisions 1a and 16
         </statute_ref>;<br/>
<a id="pl.40.1"></a><var>40.1</var>    (3) the property's gross tax, calculated by adding the property's total property tax to <br/>
<a id="pl.40.2"></a><var>40.2</var>the sum of the aids enumerated in clause (4) before credits;<br/>
<a id="pl.40.3"></a><var>40.3</var>    (4) a total of the following aids:<br/>
<a id="pl.40.4"></a><var>40.4</var>    (i) education aids payable under chapters 122A, 123A, 123B, 124D, 125A, 126C, <br/>
<a id="pl.40.5"></a><var>40.5</var>and 127A;<br/>
<a id="pl.40.6"></a><var>40.6</var>    (ii) local government aids for cities, towns, and counties under sections 
<statute_ref>477A.011</statute_ref> to <br/>
<a id="pl.40.7"></a><var>40.7</var><statute_ref>477A.04</statute_ref>; and<br/>
<a id="pl.40.8"></a><var>40.8</var>    (iii) disparity reduction aid under section 
<statute_ref>273.1398</statute_ref>;<br/>
<a id="pl.40.9"></a><var>40.9</var>    (5) (4) for homestead residential and agricultural properties, the credits under <br/>
<a id="pl.40.10"></a><var>40.10</var>section 
         <statute_ref>273.1384</statute_ref>;<br/>
<a id="pl.40.11"></a><var>40.11</var>    (6) (5) any credits received under sections 
         <statute_ref>273.119</statute_ref>; 
         <statute_ref>273.123</statute_ref>; 
         <statute_ref>273.135</statute_ref>; 
         <statute_ref>273.1391</statute_ref>; <br/>
<statute_ref><a id="pl.40.12"></a><var>40.12</var>273.1398, subdivision 4
         </statute_ref>; 
         <statute_ref>469.171</statute_ref>; and 
         <statute_ref>473H.10</statute_ref>, except that the amount of credit received <br/>
<a id="pl.40.13"></a><var>40.13</var>under section 
         <statute_ref>273.135</statute_ref> must be separately stated and identified as "taconite tax relief"; and<br/>
<a id="pl.40.14"></a><var>40.14</var>    (7) (6) the net tax payable in the manner required in paragraph (a).<br/>
<a id="pl.40.15"></a><var>40.15</var>    (d) If the county uses envelopes for mailing property tax statements and if the county <br/>
<a id="pl.40.16"></a><var>40.16</var>agrees, a taxing district may include a notice with the property tax statement notifying <br/>
<a id="pl.40.17"></a><var>40.17</var>taxpayers when the taxing district will begin its budget deliberations for the current <br/>
<a id="pl.40.18"></a><var>40.18</var>year, and encouraging taxpayers to attend the hearings. If the county allows notices to <br/>
<a id="pl.40.19"></a><var>40.19</var>be included in the envelope containing the property tax statement, and if more than <br/>
<a id="pl.40.20"></a><var>40.20</var>one taxing district relative to a given property decides to include a notice with the tax <br/>
<a id="pl.40.21"></a><var>40.21</var>statement, the county treasurer or auditor must coordinate the process and may combine <br/>
<a id="pl.40.22"></a><var>40.22</var>the information on a single announcement.<br/>
<a id="pl.40.23"></a><var>40.23</var>    The commissioner of revenue shall certify to the county auditor the actual or <br/>
<a id="pl.40.24"></a><var>40.24</var>estimated aids enumerated in paragraph (c), clause (4), that local governments will receive <br/>
<a id="pl.40.25"></a><var>40.25</var>in the following year. The commissioner must certify this amount by January 1 of each <br/>
<a id="pl.40.26"></a><var>40.26</var>year.<br/>
<a id="pl.40.27"></a><var>40.27</var><b>EFFECTIVE DATE.</b>This section is effective for property tax statements for <br/>
<a id="pl.40.28"></a><var>40.28</var>property taxes payable in 2009 and thereafter.<br/>
<br/>
<a id="bill.2.20.0"></a><a id="pl.40.29"></a><var>40.29</var>    Sec. 20. Minnesota Statutes 2006, section 278.05, subdivision 6, is amended to read:<br/>
<a id="pl.40.30"></a><var>40.30</var>    Subd. 6. <b>Dismissal of petition; exclusion of certain evidence.</b> (a) In cases where <br/>
<a id="pl.40.31"></a><var>40.31</var>the petitioner contests the valuation of income-producing property, information, including <br/>
<a id="pl.40.32"></a><var>40.32</var>income and expense figures in the form of (1) year-end financial statements for the <br/>
<a id="pl.40.33"></a><var>40.33</var>year prior to the assessment date, (2) year-end financial statements for the year of the <br/>
<a id="pl.40.34"></a><var>40.34</var>assessment date, and (3) rent rolls on the assessment date including tenant name, lease start <br/>
<a id="pl.40.35"></a><var>40.35</var>and end dates, option terms, base rent, square footage leased and vacant space, verified net <br/>
<a id="pl.41.1"></a><var>41.1</var>rentable areas in the form of net rentable square footage of the building or buildings, and <br/>
<a id="pl.41.2"></a><var>41.2</var>anticipated income and expenses in the form of proposed budgets for the year subsequent <br/>
<a id="pl.41.3"></a><var>41.3</var>to the year of the assessment date, for income-producing property must be provided to <br/>
<a id="pl.41.4"></a><var>41.4</var>the county assessor no later than 60 days after the applicable filing deadline contained <br/>
<a id="pl.41.5"></a><var>41.5</var>in section 
         <statute_ref>278.01, subdivision 1</statute_ref> or 4. Failure to provide the information required in this <br/>
<a id="pl.41.6"></a><var>41.6</var>paragraph shall result in the dismissal of the petition, unless (1) the failure to provide it was <br/>
<a id="pl.41.7"></a><var>41.7</var>due to the unavailability of the evidence at the time that the information was due, or (2) <br/>
<a id="pl.41.8"></a><var>41.8</var>the petitioner was not aware of or informed of the requirement to provide the information. <br/>
<a id="pl.41.9"></a><var>41.9</var>If the petitioner proves that the requirements under clause (2) are met, the petitioner has <br/>
<a id="pl.41.10"></a><var>41.10</var>an additional 30 days to provide the information from the time the petitioner became <br/>
<a id="pl.41.11"></a><var>41.11</var>aware of or was informed of the requirement to provide the information, otherwise the <br/>
<a id="pl.41.12"></a><var>41.12</var>petition shall be dismissed.<br/>
<a id="pl.41.13"></a><var>41.13</var>    (b) Provided that the information as contained in paragraph (a) is timely submitted to <br/>
<a id="pl.41.14"></a><var>41.14</var>the county assessor, the county assessor shall furnish the petitioner at least five days before <br/>
<a id="pl.41.15"></a><var>41.15</var>the hearing under this chapter with the property's appraisal, if any, which will be presented <br/>
<a id="pl.41.16"></a><var>41.16</var>to the court at the hearing. The petitioner shall furnish to the county assessor at least five <br/>
<a id="pl.41.17"></a><var>41.17</var>days before the hearing under this chapter with the property's appraisal, if any, which <br/>
<a id="pl.41.18"></a><var>41.18</var>will be presented to the court at the hearing. An appraisal of the petitioner's property <br/>
<a id="pl.41.19"></a><var>41.19</var>done by or for the county shall not be admissible as evidence if the county assessor does <br/>
<a id="pl.41.20"></a><var>41.20</var>not comply with the provisions in this paragraph. The petition shall be dismissed if the <br/>
<a id="pl.41.21"></a><var>41.21</var>petitioner does not comply with the provisions in this paragraph.<br/>
<a id="pl.41.22"></a><var>41.22</var><b>EFFECTIVE DATE.</b>This section is effective for petitions filed on or after July <br/>
<a id="pl.41.23"></a><var>41.23</var>1, 2008.<br/>
<br/>
<a id="bill.2.21.0"></a><a id="pl.41.24"></a><var>41.24</var>    Sec. 21. Minnesota Statutes 2006, section 279.37, subdivision 1a, is amended to read:<br/>
<a id="pl.41.25"></a><var>41.25</var>    Subd. 1a. <b>Class 3a property.</b> (a) The delinquent taxes upon a parcel of property <br/>
<a id="pl.41.26"></a><var>41.26</var>which was classified class 3a, for the previous year's assessment and had a total market <br/>
<a id="pl.41.27"></a><var>41.27</var>value of $200,000 $500,000 or less for that same assessment shall be eligible to be <br/>
<a id="pl.41.28"></a><var>41.28</var>composed into a confession of judgment. Property qualifying under this subdivision <br/>
<a id="pl.41.29"></a><var>41.29</var>shall be subject to the same provisions as provided in this section except as provided <br/>
<a id="pl.41.30"></a><var>41.30</var>in paragraphs (b) to (d).<br/>
<a id="pl.41.31"></a><var>41.31</var>    (b) Current year taxes and penalty due at the time the confession of judgment <br/>
<a id="pl.41.32"></a><var>41.32</var>is entered must be paid.<br/>
<a id="pl.41.33"></a><var>41.33</var>    (c) The down payment must include all special assessments due in the current tax <br/>
<a id="pl.41.34"></a><var>41.34</var>year, all delinquent special assessments, and 20 percent of the ad valorem tax, penalties, <br/>
<a id="pl.42.1"></a><var>42.1</var>and interest accrued against the parcel. The balance remaining is payable in four equal <br/>
<a id="pl.42.2"></a><var>42.2</var>annual installments.<br/>
<a id="pl.42.3"></a><var>42.3</var>    (d) The amounts entered in judgment bear interest at the rate provided in section <br/>
<statute_ref><a id="pl.42.4"></a><var>42.4</var>279.03, subdivision 1a
         </statute_ref>, commencing with the date the judgment is entered. The interest <br/>
<a id="pl.42.5"></a><var>42.5</var>rate is subject to change each year on the unpaid balance in the manner provided in section <br/>
<statute_ref><a id="pl.42.6"></a><var>42.6</var>279.03, subdivision 1a
         </statute_ref>. <br/>
<a id="pl.42.7"></a><var>42.7</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.2.22.0"></a><a id="pl.42.8"></a><var>42.8</var>    Sec. 22. Minnesota Statutes 2006, section 280.39, is amended to read:<br/>
<a id="pl.42.9"></a><var>42.9</var><b>280.39 DELINQUENT TAXES MAY BE PAID IN INVERSE ORDER.</b><br/>
<a id="pl.42.10"></a><var>42.10</var>    In any case where taxes for two or more years are delinquent against a parcel of <br/>
<a id="pl.42.11"></a><var>42.11</var>land, such taxes for one or more entire years the taxes, or a portion of them, if held by <br/>
<a id="pl.42.12"></a><var>42.12</var>the state, may be paid in the inverse order to that in which the taxes were levied, with <br/>
<a id="pl.42.13"></a><var>42.13</var>accrued penalties, interest, and costs upon the taxes so paid, without payment of the <br/>
<a id="pl.42.14"></a><var>42.14</var>taxes for the first of such years; provided, that such payment shall not affect the lien of <br/>
<a id="pl.42.15"></a><var>42.15</var>any unpaid taxes or tax judgment.<br/>
<a id="pl.42.16"></a><var>42.16</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.2.23.0"></a><a id="pl.42.17"></a><var>42.17</var>    Sec. 23. Minnesota Statutes 2006, section 290C.07, is amended to read:<br/>
<a id="pl.42.18"></a><var>42.18</var><b>290C.07 CALCULATION OF INCENTIVE PAYMENT.</b><br/>
<a id="pl.42.19"></a><var>42.19</var>    An approved claimant under the sustainable forest incentive program is eligible to <br/>
<a id="pl.42.20"></a><var>42.20</var>receive an annual payment. The payment shall equal the greater of:<br/>
<a id="pl.42.21"></a><var>42.21</var>    (1) the difference between the property tax that would be paid on the land using the <br/>
<a id="pl.42.22"></a><var>42.22</var>previous year's statewide average total township tax rate and the class rate for class 2b <br/>
<a id="pl.42.23"></a><var>42.23</var>timberland under section 
         <statute_ref>273.13, subdivision 23</statute_ref>, paragraph (b), if the land were valued <br/>
<a id="pl.42.24"></a><var>42.24</var>at (i) the average statewide timberland market value per acre calculated under section <br/>
<statute_ref><a id="pl.42.25"></a><var>42.25</var>290C.06
         </statute_ref>, and (ii) the average statewide timberland current use value per acre calculated <br/>
<a id="pl.42.26"></a><var>42.26</var>under section 
         <statute_ref>290C.02, subdivision 5</statute_ref>; or<br/>
<a id="pl.42.27"></a><var>42.27</var>    (2) two-thirds of the property tax amount determined by using the previous year's <br/>
<a id="pl.42.28"></a><var>42.28</var>statewide average total township tax rate, the estimated market value per acre as calculated <br/>
<a id="pl.42.29"></a><var>42.29</var>in section 
         <statute_ref>290C.06</statute_ref>, and the class rate for 2b timberland under section 
         <statute_ref>273.13, subdivision <br/>
<a id="pl.42.30"></a><var>42.30</var>23
         </statute_ref>, paragraph (b); or <br/>
<a id="pl.42.31"></a><var>42.31</var>    (3) $1.50, provided that the payment shall be no less than $7 per acre for each acre <br/>
<a id="pl.42.32"></a><var>42.32</var>enrolled in the sustainable forest incentive program.<br/>
<a id="pl.43.1"></a><var>43.1</var><b>EFFECTIVE DATE.</b>This section is effective for payments made after June 30, <br/>
<a id="pl.43.2"></a><var>43.2</var>2008.<br/>
<br/>
<a id="bill.2.24.0"></a><a id="pl.43.3"></a><var>43.3</var>    Sec. 24. Minnesota Statutes 2006, section 360.031, is amended to read:<br/>
<a id="pl.43.4"></a><var>43.4</var><b>360.031 DEFINITION OF MUNICIPALITY.</b><br/>
<a id="pl.43.5"></a><var>43.5</var>    For the purposes of sections 
         <statute_ref>360.031</statute_ref> to 
         <statute_ref>360.045</statute_ref>, inclusive (except section 360.042), <br/>
<a id="pl.43.6"></a><var>43.6</var>only, "municipality" means any county, city, or town, or airport authority of this state. <br/>
<br/>
<a id="bill.2.25.0"></a><a id="pl.43.7"></a><var>43.7</var>    Sec. 25. <b>[360.0425] GENERAL POWERS OF AUTHORITY.</b><br/>
<a id="pl.43.8"></a><var>43.8</var>    An airport authority created under section 360.0426 has all the powers granted a <br/>
<a id="pl.43.9"></a><var>43.9</var>municipality under sections 360.032 to 360.046.<br/>
<br/>
<a id="bill.2.26.0"></a><a id="pl.43.10"></a><var>43.10</var>    Sec. 26. <b>[360.0426] CREATION OF AN AIRPORT AUTHORITY; </b><br/>
<a id="pl.43.11"></a><var>43.11</var><b>DISSOLUTION.</b><br/>
<a id="pl.43.12"></a><var>43.12</var>    Subdivision 1. <b>Members; definition.</b> A city together with another city, county, <br/>
<a id="pl.43.13"></a><var>43.13</var>town, or an Indian tribe may create an airport authority. For purposes of this chapter, <br/>
<a id="pl.43.14"></a><var>43.14</var>"airport authority" means a governmental entity created pursuant to this section for the <br/>
<a id="pl.43.15"></a><var>43.15</var>purpose of acquiring, establishing, constructing, maintaining, improving, and operating <br/>
<a id="pl.43.16"></a><var>43.16</var>airports and other air navigation facilities.<br/>
<a id="pl.43.17"></a><var>43.17</var>    Subd. 2. <b>Process to establish authority.</b> A city that owns an airport by joint <br/>
<a id="pl.43.18"></a><var>43.18</var>resolution together with other willing governmental units may create an airport authority <br/>
<a id="pl.43.19"></a><var>43.19</var>that is authorized to exercise its functions upon passage of a joint resolution by each of <br/>
<a id="pl.43.20"></a><var>43.20</var>their governing bodies, including a proposed date for the first meeting of the authority.<br/>
<a id="pl.43.21"></a><var>43.21</var>    Subd. 3. <b>Airport authority commission.</b> The powers of the airport authority shall <br/>
<a id="pl.43.22"></a><var>43.22</var>be vested in the airport authority commissioners. The commission shall consist of at <br/>
<a id="pl.43.23"></a><var>43.23</var>least five commissioners. Each governmental unit that is a member of the authority shall <br/>
<a id="pl.43.24"></a><var>43.24</var>be represented by at least one commissioner. If fewer than five governmental units are <br/>
<a id="pl.43.25"></a><var>43.25</var>members of the authority, there must be two commissioners appointed from each member <br/>
<a id="pl.43.26"></a><var>43.26</var>unit of government. The terms of each commissioner are three years, provided that the <br/>
<a id="pl.43.27"></a><var>43.27</var>length of the initial appointments must be staggered so that the terms of approximately <br/>
<a id="pl.43.28"></a><var>43.28</var>one-third of the commissioners expire each calendar year.<br/>
<a id="pl.43.29"></a><var>43.29</var>    Subd. 4. <b>Appointment of commissioners.</b> The governmental body of each member <br/>
<a id="pl.43.30"></a><var>43.30</var>governmental unit shall appoint a resident of that governmental unit to be a commissioner <br/>
<a id="pl.43.31"></a><var>43.31</var>of the airport authority. Upon vacancy of a commissioner prior to the end of a normal term, <br/>
<a id="pl.43.32"></a><var>43.32</var>the appropriate governmental body shall appoint a commissioner to fill the unexpired term.<br/>
<a id="pl.44.1"></a><var>44.1</var>    Subd. 5. <b>Compensation; meetings; officers.</b> Commissioners shall receive no <br/>
<a id="pl.44.2"></a><var>44.2</var>compensation for services, but are entitled to payment for necessary expenses, including <br/>
<a id="pl.44.3"></a><var>44.3</var>travel expenses, incurred in the discharge of the commissioners' duties.<br/>
<a id="pl.44.4"></a><var>44.4</var>    The commission shall establish a regular meeting schedule. A majority of the <br/>
<a id="pl.44.5"></a><var>44.5</var>commissioners of the authority constitutes a quorum for purposes of conducting business <br/>
<a id="pl.44.6"></a><var>44.6</var>of the authority. Action may be taken by the majority vote of not less than a majority of <br/>
<a id="pl.44.7"></a><var>44.7</var>the commissioners present, providing there is a quorum.<br/>
<a id="pl.44.8"></a><var>44.8</var>    The commission shall elect a chair, a vice-chair, a secretary, and a treasurer at its <br/>
<a id="pl.44.9"></a><var>44.9</var>organizational meeting. The authority may hire an executive director, a legal advisor, <br/>
<a id="pl.44.10"></a><var>44.10</var>technical experts, and other employees, permanent and temporary, as it may require.<br/>
<a id="pl.44.11"></a><var>44.11</var>    Subd. 6. <b>Process to increase size of authority.</b> An airport authority may be <br/>
<a id="pl.44.12"></a><var>44.12</var>increased in size by adding additional governmental entities if each of the additional <br/>
<a id="pl.44.13"></a><var>44.13</var>entities and each of the governmental entities currently included in the existing authority <br/>
<a id="pl.44.14"></a><var>44.14</var>adopt a resolution agreeing to the size increase.<br/>
<a id="pl.44.15"></a><var>44.15</var>    Subd. 7. <b>Process to decrease size of authority.</b> An airport authority may be <br/>
<a id="pl.44.16"></a><var>44.16</var>decreased in size if each of the governmental entities that are members of the authority <br/>
<a id="pl.44.17"></a><var>44.17</var>and the current commissioners consent to change and make provisions for the retention <br/>
<a id="pl.44.18"></a><var>44.18</var>or disposition of its assets and liabilities.<br/>
<a id="pl.44.19"></a><var>44.19</var>    Subd. 8. <b>Process to dissolve authority.</b> An airport authority may be dissolved after <br/>
<a id="pl.44.20"></a><var>44.20</var>payment of all debts and adoption of a joint resolution of the governing bodies of all of <br/>
<a id="pl.44.21"></a><var>44.21</var>the participating units of government. Before dissolution, the property of the airport <br/>
<a id="pl.44.22"></a><var>44.22</var>authority must be sold, transferred, or distributed as agreed to by the participating units <br/>
<a id="pl.44.23"></a><var>44.23</var>of government. Any remaining funds must be distributed to the general funds of the <br/>
<a id="pl.44.24"></a><var>44.24</var>participating units of government in proportion to their relative shares of the most recent <br/>
<a id="pl.44.25"></a><var>44.25</var>levy under section 360.0427.<br/>
<br/>
<a id="bill.2.27.0"></a><a id="pl.44.26"></a><var>44.26</var>    Sec. 27. <b>[360.0427] TAX LEVY MAY BE CERTIFIED BY AN AIRPORT </b><br/>
<a id="pl.44.27"></a><var>44.27</var><b>AUTHORITY.</b><br/>
<a id="pl.44.28"></a><var>44.28</var>    In any year in which it imposes a property tax levy under sections 275.065 to <br/>
<a id="pl.44.29"></a><var>44.29</var>275.07, which requires an affirmative vote of at least two-thirds of the members of the <br/>
<a id="pl.44.30"></a><var>44.30</var>authority, an airport authority must submit its proposed levy to the governing body of the <br/>
<a id="pl.44.31"></a><var>44.31</var>municipality that contains the airport. The municipal governing body may approve or <br/>
<a id="pl.44.32"></a><var>44.32</var>modify the amount of the levy, and, when it has determined the amount, the authority must <br/>
<a id="pl.44.33"></a><var>44.33</var>certify to the auditor of the county where the airport is located the amount to be levied on <br/>
<a id="pl.44.34"></a><var>44.34</var>all taxable property within the boundaries of the airport authority.<br/>
<a id="pl.45.1"></a><var>45.1</var><b>EFFECTIVE DATE.</b>This section is effective for taxes payable in 2009, and <br/>
<a id="pl.45.2"></a><var>45.2</var>thereafter.<br/>
<br/>
<a id="bill.2.28.0"></a><a id="pl.45.3"></a><var>45.3</var>    Sec. 28. Minnesota Statutes 2006, section 435.193, is amended to read:<br/>
<a id="pl.45.4"></a><var>45.4</var><b>435.193 HARDSHIP ASSESSMENT DEFERRAL FOR SENIORS </b><b>OR</b><b>,</b><b> </b><br/>
<a id="pl.45.5"></a><var>45.5</var><b>DISABLED</b><b>, OR MILITARY PERSONS</b><b>.</b><br/>
<a id="pl.45.6"></a><var>45.6</var>    (a) Notwithstanding the provisions of any law to the contrary, any county, statutory <br/>
<a id="pl.45.7"></a><var>45.7</var>or home rule charter city, or town, making a special assessment may, at its discretion, defer <br/>
<a id="pl.45.8"></a><var>45.8</var>the payment of that assessment for any homestead property:<br/>
<a id="pl.45.9"></a><var>45.9</var>    (1) owned by a person 65 years of age or older or retired by virtue of a permanent <br/>
<a id="pl.45.10"></a><var>45.10</var>and total disability for whom it would be a hardship to make the payments; or<br/>
<a id="pl.45.11"></a><var>45.11</var>    (2) owned by a person who is a member of the Minnesota National Guard or other <br/>
<a id="pl.45.12"></a><var>45.12</var>military reserves who is ordered into active military service, as defined in section 190.05, <br/>
<a id="pl.45.13"></a><var>45.13</var>subdivision 5b or 5c, as stated in the person's military orders, for whom it would be a <br/>
<a id="pl.45.14"></a><var>45.14</var>hardship to make the payments.<br/>
<a id="pl.45.15"></a><var>45.15</var>    (b) Any county, statutory or home rule charter city, or town electing to defer <br/>
<a id="pl.45.16"></a><var>45.16</var>special assessments shall adopt an ordinance or resolution establishing standards and <br/>
<a id="pl.45.17"></a><var>45.17</var>guidelines for determining the existence of a hardship and for determining the existence of <br/>
<a id="pl.45.18"></a><var>45.18</var>a disability, but nothing herein shall be construed to prohibit the determination of hardship <br/>
<a id="pl.45.19"></a><var>45.19</var>on the basis of exceptional and unusual circumstances not covered by the standards and <br/>
<a id="pl.45.20"></a><var>45.20</var>guidelines where the determination is made in a nondiscriminatory manner and does not <br/>
<a id="pl.45.21"></a><var>45.21</var>give the applicant an unreasonable preference or advantage over other applicants.<br/>
<a id="pl.45.22"></a><var>45.22</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment, <br/>
<a id="pl.45.23"></a><var>45.23</var>and applies to any special assessment for which payment is due on or after that date.<br/>
<br/>
<a id="bill.2.29.0"></a><a id="pl.45.24"></a><var>45.24</var>    Sec. 29. Laws 1973, chapter 393, section 1, as amended by Laws 1974, chapter 153, <br/>
<a id="pl.45.25"></a><var>45.25</var>section 1, is amended to read:<br/>
<a id="pl.45.26"></a><var>45.26</var>    Section 1. <b>MINNEAPOLIS, CITY OF; STREET MAINTENANCE AND </b><br/>
<a id="pl.45.27"></a><var>45.27</var><b>LIGHTING.</b><br/>
<a id="pl.45.28"></a><var>45.28</var>    Notwithstanding the provisions of any statute or the charter of the city of <br/>
<a id="pl.45.29"></a><var>45.29</var>Minneapolis to the contrary, the city council of said city may provide that all or part of the <br/>
<a id="pl.45.30"></a><var>45.30</var>costs of construction, operation, and maintenance of streets and street lighting within the <br/>
<a id="pl.45.31"></a><var>45.31</var>city may hereafter be paid from the general revenues of the city of Minneapolis; provided <br/>
<a id="pl.45.32"></a><var>45.32</var>that the portion of the costs assessable against nongovernmental real property exempt from <br/>
<a id="pl.45.33"></a><var>45.33</var>ad valorem taxation may be levied as a special assessment against the property.<br/>
<br/>
<a id="bill.2.30.0"></a><a id="pl.46.1"></a><var>46.1</var>    Sec. 30. Laws 1988, chapter 645, section 3, as amended by Laws 1999, chapter 243, <br/>
<a id="pl.46.2"></a><var>46.2</var>article 6, section 9, and Laws 2000, chapter 490, article 6, section 15, is amended to read:<br/>
<a id="pl.46.3"></a><var>46.3</var>    Sec. 3. <b>TAX; PAYMENT OF EXPENSES.</b><br/>
<a id="pl.46.4"></a><var>46.4</var>    (a) The tax levied by the hospital district under Minnesota Statutes, section 
         <statute_ref>447.34</statute_ref>, <br/>
<a id="pl.46.5"></a><var>46.5</var>must not be levied at a rate that exceeds 0.063 percent of taxable market value the amount <br/>
<a id="pl.46.6"></a><var>46.6</var>authorized to be levied under that section. The proceeds of the tax may be used for all <br/>
<a id="pl.46.7"></a><var>46.7</var>purposes of the hospital district, except as provided in paragraph (b).<br/>
<a id="pl.46.8"></a><var>46.8</var>    (b) 0.048 percent of taxable market value of tax in paragraph (a) may be used only <br/>
<a id="pl.46.9"></a><var>46.9</var>for acquisition, betterment, and maintenance of the district's hospital and nursing home <br/>
<a id="pl.46.10"></a><var>46.10</var>facilities and equipment, and not for administrative or salary expenses.<br/>
<a id="pl.46.11"></a><var>46.11</var>    (c) 0.015 percent of taxable market value of the tax in paragraph (a) may be used <br/>
<a id="pl.46.12"></a><var>46.12</var>solely for the purpose of capital expenditures as it relates to ambulance acquisitions for <br/>
<a id="pl.46.13"></a><var>46.13</var>the Cook ambulance service and the Orr ambulance service and not for administrative <br/>
<a id="pl.46.14"></a><var>46.14</var>or salary expenses.<br/>
<a id="pl.46.15"></a><var>46.15</var>    The part of the levy referred to in paragraph (c) (b) must be administered by the <br/>
<a id="pl.46.16"></a><var>46.16</var>Cook Hospital and passed on directly to the Cook area ambulance service board and the <br/>
<a id="pl.46.17"></a><var>46.17</var>city of Orr to be held in trust until funding for a new ambulance is needed by either the <br/>
<a id="pl.46.18"></a><var>46.18</var>Cook ambulance service or the Orr ambulance service.<br/>
<a id="pl.46.19"></a><var>46.19</var><b>EFFECTIVE DATE.</b>This section is effective upon compliance with Minnesota <br/>
<a id="pl.46.20"></a><var>46.20</var>Statutes, section 645.021, subdivision 3, by the governing body of the Cook-Orr Hospital <br/>
<a id="pl.46.21"></a><var>46.21</var>District.<br/>
<br/>
<a id="bill.2.31.0"></a><a id="pl.46.22"></a><var>46.22</var>    Sec. 31. Laws 1989, chapter 211, section 8, subdivision 4, as amended by Laws 2002, <br/>
<a id="pl.46.23"></a><var>46.23</var>chapter 390, section 24, and Laws 2003, chapter 127, article 2, section 22, subdivision 4, <br/>
<a id="pl.46.24"></a><var>46.24</var>is amended to read:<br/>
<a id="pl.46.25"></a><var>46.25</var>    Subd. 4. <b>Tax levy.</b> The tax levied under Minnesota Statutes, section 
         <statute_ref>447.34</statute_ref>, shall <br/>
<a id="pl.46.26"></a><var>46.26</var>not exceed $300,000 for taxes levied in 2002. For taxes levied in 2003 and subsequent <br/>
<a id="pl.46.27"></a><var>46.27</var>years, the tax must not exceed the lesser of:<br/>
<a id="pl.46.28"></a><var>46.28</var>    (1) the product of the hospital district's property tax levy limitation for the previous <br/>
<a id="pl.46.29"></a><var>46.29</var>year determined under this subdivision, multiplied by 103 percent; or <br/>
<a id="pl.46.30"></a><var>46.30</var>    (2) the product of the hospital district's property tax levy limitation for the previous <br/>
<a id="pl.46.31"></a><var>46.31</var>year determined under this subdivision multiplied by the ratio of the most recent available <br/>
<a id="pl.46.32"></a><var>46.32</var>annual medical care expenditure category of the revised Consumer Price Index, U.S. <br/>
<a id="pl.46.33"></a><var>46.33</var>citywide average, for all urban consumers prepared by the United States Department of <br/>
<a id="pl.46.34"></a><var>46.34</var>Labor to the same annual index for the previous year the amount authorized to be levied <br/>
<a id="pl.46.35"></a><var>46.35</var>under that section.<br/>
<a id="pl.47.1"></a><var>47.1</var>    The proceeds of the tax may be used for all purposes of the hospital district.<br/>
<a id="pl.47.2"></a><var>47.2</var><b>EFFECTIVE DATE.</b>This section is effective upon compliance with Minnesota <br/>
<a id="pl.47.3"></a><var>47.3</var>Statutes, section 645.021, subdivision 3, by the governing body of the Cook County <br/>
<a id="pl.47.4"></a><var>47.4</var>Hospital District.<br/>
<br/>
<a id="bill.2.32.0"></a><a id="pl.47.5"></a><var>47.5</var>    Sec. 32. <b>LAKEVIEW CEMETERY ASSOCIATION.</b><br/>
<a id="pl.47.6"></a><var>47.6</var>    Subdivision 1. <b>Authorized.</b> Any two or more of the following cities and towns in <br/>
<a id="pl.47.7"></a><var>47.7</var>Itasca County may enter into a joint powers agreement under Minnesota Statutes, section <br/>
<a id="pl.47.8"></a><var>47.8</var>471.59, to establish the Lakeview Cemetery Association with the powers and duties of a <br/>
<a id="pl.47.9"></a><var>47.9</var>cemetery association under Minnesota Statutes, chapter 306: the cities of Bovey, Calumet, <br/>
<a id="pl.47.10"></a><var>47.10</var>Coleraine, Marble, and Taconite, and the towns of Greenway, Iron Range, Lawrence, <br/>
<a id="pl.47.11"></a><var>47.11</var>and Trout Lake.<br/>
<a id="pl.47.12"></a><var>47.12</var>    Subd. 2. <b>Additions; withdrawals.</b> (a) A city or town listed in subdivision 1 that <br/>
<a id="pl.47.13"></a><var>47.13</var>does not join the association at the time of the initial agreement may join as provided in <br/>
<a id="pl.47.14"></a><var>47.14</var>the joint powers agreement, or if the joint powers agreement does not provide for later <br/>
<a id="pl.47.15"></a><var>47.15</var>additions, by providing the association a copy of the adopted resolution to join. If the <br/>
<a id="pl.47.16"></a><var>47.16</var>joint powers agreement does not provide for adding members, a city or town that joins <br/>
<a id="pl.47.17"></a><var>47.17</var>after the initial agreement is effective, may join prior to July 1 of the levy year, for taxes <br/>
<a id="pl.47.18"></a><var>47.18</var>payable in the following year.<br/>
<a id="pl.47.19"></a><var>47.19</var>    (b) A city or town may withdraw from the association as otherwise provided in the <br/>
<a id="pl.47.20"></a><var>47.20</var>joint powers agreement, or providing to the association a copy of the adopted resolution of <br/>
<a id="pl.47.21"></a><var>47.21</var>the city or town, prior to July 1 of the levy year for taxes payable in the following year.<br/>
<a id="pl.47.22"></a><var>47.22</var>    Subd. 3. <b>Operation; tax levy.</b> The joint powers agreement for the association may <br/>
<a id="pl.47.23"></a><var>47.23</var>provide for a uniform tax rate to be levied against all taxable properties located within each <br/>
<a id="pl.47.24"></a><var>47.24</var>participating city or town. The maximum amount that may be levied by all participating <br/>
<a id="pl.47.25"></a><var>47.25</var>cities and towns combined shall not exceed a total of $200,000 per year. If levied, the <br/>
<a id="pl.47.26"></a><var>47.26</var>tax is in addition to all other taxes permitted to be levied on the property, including taxes <br/>
<a id="pl.47.27"></a><var>47.27</var>permitted to be levied for cemetery purposes by a participating city or town. The levy <br/>
<a id="pl.47.28"></a><var>47.28</var>under this section must be disregarded in the calculation of all other rate or per capita levy <br/>
<a id="pl.47.29"></a><var>47.29</var>limitations imposed by law. One of the cities or towns within the association, chosen by <br/>
<a id="pl.47.30"></a><var>47.30</var>the members of the association, shall certify a tax levy to the Itasca County auditor. When <br/>
<a id="pl.47.31"></a><var>47.31</var>collected, the Itasca County auditor shall pay the Lakeview Cemetery Association directly.<br/>
<a id="pl.47.32"></a><var>47.32</var><b>EFFECTIVE DATE.</b>This section is effective for taxes payable in 2009 and <br/>
<a id="pl.47.33"></a><var>47.33</var>thereafter.<br/>
<br/>
<a id="bill.2.33.0"></a><a id="pl.48.1"></a><var>48.1</var>    Sec. 33. <b>REPEALER.</b><br/>
<a id="pl.48.2"></a><var>48.2</var>(a) Laws 1973, chapter 393, section 2, is repealed.<br/>
<a id="pl.48.3"></a><var>48.3</var>(b) Laws 1994, chapter 587, article 9, section 8, subdivision 1, as amended by Laws <br/>
<a id="pl.48.4"></a><var>48.4</var>2005, First Special Session chapter 3, article 1, section 36, is repealed, effective for the <br/>
<a id="pl.48.5"></a><var>48.5</var>same levy year in which the association initially levies under section 32.<br/>
<a id="pl.48.6"></a><var>48.6</var>(c) Minnesota Statutes 2006, section 163.051, subdivision 5, is repealed, effective <br/>
<a id="pl.48.7"></a><var>48.7</var>for taxes payable in 2007 and thereafter.<br/>
<br/>
<a id="bill.3.0.0"></a>

<a id="bill.3.1.0"></a><a id="pl.48.10"></a><var>48.10</var>    Section 1. Minnesota Statutes 2006, section 289A.12, subdivision 4, is amended to <br/>
<a id="pl.48.11"></a><var>48.11</var>read:<br/>
<a id="pl.48.12"></a><var>48.12</var>    Subd. 4. <b>Returns by persons, corporations, cooperatives, governmental entities, </b><br/>
<a id="pl.48.13"></a><var>48.13</var><b>or school districts.</b> (a) The commissioner may by notice and demand require to the <br/>
<a id="pl.48.14"></a><var>48.14</var>extent required by section 6041 of the Internal Revenue Code, a person, corporation, <br/>
<a id="pl.48.15"></a><var>48.15</var>or cooperative, the state of Minnesota and its political subdivisions, and a city, county, <br/>
<a id="pl.48.16"></a><var>48.16</var>and school district in Minnesota, making payments in the regular course of a trade or <br/>
<a id="pl.48.17"></a><var>48.17</var>business during the taxable year to any person or corporation of $600 or more on account <br/>
<a id="pl.48.18"></a><var>48.18</var>of rents or royalties, or of $10 or more on account of interest, or $10 or more on account <br/>
<a id="pl.48.19"></a><var>48.19</var>of dividends or patronage dividends, or $600 or more on account of either wages, salaries, <br/>
<a id="pl.48.20"></a><var>48.20</var>commissions, fees, prizes, awards, pensions, annuities, or any other fixed or determinable <br/>
<a id="pl.48.21"></a><var>48.21</var>gains, profits or income, not otherwise reportable under section 
         <statute_ref>289A.09, subdivision 2</statute_ref>, or <br/>
<a id="pl.48.22"></a><var>48.22</var>on account of earnings of $10 or more distributed to its members by savings associations <br/>
<a id="pl.48.23"></a><var>48.23</var>or credit unions chartered under the laws of this state or the United States, (1) to file with <br/>
<a id="pl.48.24"></a><var>48.24</var>the commissioner a return (except in cases where a valid agreement to participate in the <br/>
<a id="pl.48.25"></a><var>48.25</var>combined federal and state information reporting system has been entered into, and the <br/>
<a id="pl.48.26"></a><var>48.26</var>return is filed only with the commissioner of internal revenue under the applicable filing <br/>
<a id="pl.48.27"></a><var>48.27</var>and informational reporting requirements of the Internal Revenue Code) with respect to <br/>
<a id="pl.48.28"></a><var>48.28</var>the payments in excess of the amounts named, giving the names and addresses of the <br/>
<a id="pl.48.29"></a><var>48.29</var>persons to whom the payments were made, the amounts paid to each, and (2) to make <br/>
<a id="pl.48.30"></a><var>48.30</var>a return with respect to the total number of payments and total amount of payments, <br/>
<a id="pl.48.31"></a><var>48.31</var>for each category of income named, which were in excess of the amounts named. This <br/>
<a id="pl.48.32"></a><var>48.32</var>subdivision does not apply to the payment of interest or dividends to a person who was a <br/>
<a id="pl.48.33"></a><var>48.33</var>nonresident of Minnesota for the entire year. <br/>
<a id="pl.49.1"></a><var>49.1</var>    (b) For payments for which a return is covered by paragraph (a), regardless of <br/>
<a id="pl.49.2"></a><var>49.2</var>whether the commissioner has required filing under paragraph (a), the payor must file a <br/>
<a id="pl.49.3"></a><var>49.3</var>copy of the return with the commissioner if: <br/>
<a id="pl.49.4"></a><var>49.4</var>    (i) the return is for a payment made to a Minnesota resident, to a recipient with a <br/>
<a id="pl.49.5"></a><var>49.5</var>Minnesota address, or for activity occurring in the state of Minnesota; and <br/>
<a id="pl.49.6"></a><var>49.6</var>    (ii) the payment is for wages, salaries, or other compensation for services provided. <br/>
<a id="pl.49.7"></a><var>49.7</var>The commissioner may require this information to be filed in electronic or another form <br/>
<a id="pl.49.8"></a><var>49.8</var>that the commissioner determines is appropriate, notwithstanding the provisions of <br/>
<a id="pl.49.9"></a><var>49.9</var>paragraph (c).<br/>
<a id="pl.49.10"></a><var>49.10</var>    (c) A person, corporation, or cooperative required to file returns under this <br/>
<a id="pl.49.11"></a><var>49.11</var>subdivision must file the returns on magnetic media if magnetic media was used to satisfy <br/>
<a id="pl.49.12"></a><var>49.12</var>the federal reporting requirement under section 6011(e) of the Internal Revenue Code, <br/>
<a id="pl.49.13"></a><var>49.13</var>unless the person establishes to the satisfaction of the commissioner that compliance with <br/>
<a id="pl.49.14"></a><var>49.14</var>this requirement would be an undue hardship.<br/>
<a id="pl.49.15"></a><var>49.15</var><b>EFFECTIVE DATE.</b>This section is effective for forms required to be filed by <br/>
<a id="pl.49.16"></a><var>49.16</var>federal law after December 31, 2009.<br/>
<br/>
<a id="bill.3.2.0"></a><a id="pl.49.17"></a><var>49.17</var>    Sec. 2. Minnesota Statutes 2006, section 290.01, subdivision 19a, is amended to read:<br/>
<a id="pl.49.18"></a><var>49.18</var>    Subd. 19a. <b>Additions to federal taxable income.</b> For individuals, estates, and <br/>
<a id="pl.49.19"></a><var>49.19</var>trusts, there shall be added to federal taxable income:<br/>
<a id="pl.49.20"></a><var>49.20</var>    (1)(i) interest income on obligations of any state other than Minnesota or a political <br/>
<a id="pl.49.21"></a><var>49.21</var>or governmental subdivision, municipality, or governmental agency or instrumentality <br/>
<a id="pl.49.22"></a><var>49.22</var>of any state other than Minnesota exempt from federal income taxes under the Internal <br/>
<a id="pl.49.23"></a><var>49.23</var>Revenue Code or any other federal statute; and<br/>
<a id="pl.49.24"></a><var>49.24</var>    (ii) exempt-interest dividends as defined in section 852(b)(5) of the Internal Revenue <br/>
<a id="pl.49.25"></a><var>49.25</var>Code, except the portion of the exempt-interest dividends derived from interest income <br/>
<a id="pl.49.26"></a><var>49.26</var>on obligations of the state of Minnesota or its political or governmental subdivisions, <br/>
<a id="pl.49.27"></a><var>49.27</var>municipalities, governmental agencies or instrumentalities, but only if the portion of the <br/>
<a id="pl.49.28"></a><var>49.28</var>exempt-interest dividends from such Minnesota sources paid to all shareholders represents <br/>
<a id="pl.49.29"></a><var>49.29</var>95 percent or more of the exempt-interest dividends that are paid by the regulated <br/>
<a id="pl.49.30"></a><var>49.30</var>investment company as defined in section 851(a) of the Internal Revenue Code, or the <br/>
<a id="pl.49.31"></a><var>49.31</var>fund of the regulated investment company as defined in section 851(g) of the Internal <br/>
<a id="pl.49.32"></a><var>49.32</var>Revenue Code, making the payment; and<br/>
<a id="pl.49.33"></a><var>49.33</var>    (iii) for the purposes of items (i) and (ii), interest on obligations of an Indian tribal <br/>
<a id="pl.49.34"></a><var>49.34</var>government described in section 7871(c) of the Internal Revenue Code shall be treated as <br/>
<a id="pl.49.35"></a><var>49.35</var>interest income on obligations of the state in which the tribe is located;<br/>
<a id="pl.50.1"></a><var>50.1</var>    (2) the amount of income or sales and use taxes paid or accrued within the taxable <br/>
<a id="pl.50.2"></a><var>50.2</var>year under this chapter and the amount of taxes based on net income paid or sales and use <br/>
<a id="pl.50.3"></a><var>50.3</var>taxes paid to any other state or to any province or territory of Canada, to the extent allowed <br/>
<a id="pl.50.4"></a><var>50.4</var>as a deduction under section 63(d) of the Internal Revenue Code, but the addition may not <br/>
<a id="pl.50.5"></a><var>50.5</var>be more than the amount by which the itemized deductions as allowed under section 63(d) <br/>
<a id="pl.50.6"></a><var>50.6</var>of the Internal Revenue Code exceeds the amount of the standard deduction as defined <br/>
<a id="pl.50.7"></a><var>50.7</var>in section 63(c) of the Internal Revenue Code. For the purpose of this paragraph, the <br/>
<a id="pl.50.8"></a><var>50.8</var>disallowance of itemized deductions under section 68 of the Internal Revenue Code of <br/>
<a id="pl.50.9"></a><var>50.9</var>1986, income or sales and use tax is the last itemized deduction disallowed;<br/>
<a id="pl.50.10"></a><var>50.10</var>    (3) the capital gain amount of a lump sum distribution to which the special tax under <br/>
<a id="pl.50.11"></a><var>50.11</var>section 1122(h)(3)(B)(ii) of the Tax Reform Act of 1986, Public Law 99-514, applies;<br/>
<a id="pl.50.12"></a><var>50.12</var>    (4) the amount of income taxes paid or accrued within the taxable year under this <br/>
<a id="pl.50.13"></a><var>50.13</var>chapter and taxes based on net income paid to any other state or any province or territory <br/>
<a id="pl.50.14"></a><var>50.14</var>of Canada, to the extent allowed as a deduction in determining federal adjusted gross <br/>
<a id="pl.50.15"></a><var>50.15</var>income. For the purpose of this paragraph, income taxes do not include the taxes imposed <br/>
<a id="pl.50.16"></a><var>50.16</var>by sections 
         <statute_ref>290.0922, subdivision 1</statute_ref>, paragraph (b), 
         <statute_ref>290.9727</statute_ref>, 
         <statute_ref>290.9728</statute_ref>, and 
         <statute_ref>290.9729</statute_ref>;<br/>
<a id="pl.50.17"></a><var>50.17</var>    (5) the amount of expense, interest, or taxes disallowed pursuant to section 
         <statute_ref>290.10</statute_ref> <br/>
<a id="pl.50.18"></a><var>50.18</var>other than expenses or interest used in computing net interest income for the subtraction <br/>
<a id="pl.50.19"></a><var>50.19</var>allowed under subdivision 19b, clause (1);<br/>
<a id="pl.50.20"></a><var>50.20</var>    (6) the amount of a partner's pro rata share of net income which does not flow <br/>
<a id="pl.50.21"></a><var>50.21</var>through to the partner because the partnership elected to pay the tax on the income under <br/>
<a id="pl.50.22"></a><var>50.22</var>section 6242(a)(2) of the Internal Revenue Code;<br/>
<a id="pl.50.23"></a><var>50.23</var>    (7) 80 percent of the depreciation deduction allowed under section 168(k) of the <br/>
<a id="pl.50.24"></a><var>50.24</var>Internal Revenue Code. For purposes of this clause, if the taxpayer has an activity that <br/>
<a id="pl.50.25"></a><var>50.25</var>in the taxable year generates a deduction for depreciation under section 168(k) and the <br/>
<a id="pl.50.26"></a><var>50.26</var>activity generates a loss for the taxable year that the taxpayer is not allowed to claim for <br/>
<a id="pl.50.27"></a><var>50.27</var>the taxable year, "the depreciation allowed under section 168(k)" for the taxable year is <br/>
<a id="pl.50.28"></a><var>50.28</var>limited to excess of the depreciation claimed by the activity under section 168(k) over the <br/>
<a id="pl.50.29"></a><var>50.29</var>amount of the loss from the activity that is not allowed in the taxable year. In succeeding <br/>
<a id="pl.50.30"></a><var>50.30</var>taxable years when the losses not allowed in the taxable year are allowed, the depreciation <br/>
<a id="pl.50.31"></a><var>50.31</var>under section 168(k) is allowed;<br/>
<a id="pl.50.32"></a><var>50.32</var>    (8) 80 percent of the amount by which the deduction allowed by section 179 of the <br/>
<a id="pl.50.33"></a><var>50.33</var>Internal Revenue Code exceeds the deduction allowable by section 179 of the Internal <br/>
<a id="pl.50.34"></a><var>50.34</var>Revenue Code of 1986, as amended through December 31, 2003;<br/>
<a id="pl.50.35"></a><var>50.35</var>    (9) to the extent deducted in computing federal taxable income, the amount of the <br/>
<a id="pl.50.36"></a><var>50.36</var>deduction allowable under section 199 of the Internal Revenue Code; and<br/>
<a id="pl.51.1"></a><var>51.1</var>    (10) the exclusion allowed under section 139A of the Internal Revenue Code for <br/>
<a id="pl.51.2"></a><var>51.2</var>federal subsidies for prescription drug plans; and<br/>
<a id="pl.51.3"></a><var>51.3</var>    (11) the amount of expenses disallowed under section 290.10, subdivision 2.<br/>
<a id="pl.51.4"></a><var>51.4</var><b>EFFECTIVE DATE.</b>This section is effective for taxable years beginning after <br/>
<a id="pl.51.5"></a><var>51.5</var>December 31, 2007, for disallowed expenses assessed after the date of final enactment <br/>
<a id="pl.51.6"></a><var>51.6</var>of this act.<br/>
<br/>
<a id="bill.3.3.0"></a><a id="pl.51.7"></a><var>51.7</var>    Sec. 3. Minnesota Statutes 2007 Supplement, section 290.01, subdivision 19b, is <br/>
<a id="pl.51.8"></a><var>51.8</var>amended to read:<br/>
<a id="pl.51.9"></a><var>51.9</var>    Subd. 19b. <b>Subtractions from federal taxable income.</b> For individuals, estates, <br/>
<a id="pl.51.10"></a><var>51.10</var>and trusts, there shall be subtracted from federal taxable income:<br/>
<a id="pl.51.11"></a><var>51.11</var>    (1) net interest income on obligations of any authority, commission, or <br/>
<a id="pl.51.12"></a><var>51.12</var>instrumentality of the United States to the extent includable in taxable income for federal <br/>
<a id="pl.51.13"></a><var>51.13</var>income tax purposes but exempt from state income tax under the laws of the United States;<br/>
<a id="pl.51.14"></a><var>51.14</var>    (2) if included in federal taxable income, the amount of any overpayment of income <br/>
<a id="pl.51.15"></a><var>51.15</var>tax to Minnesota or to any other state, for any previous taxable year, whether the amount <br/>
<a id="pl.51.16"></a><var>51.16</var>is received as a refund or as a credit to another taxable year's income tax liability;<br/>
<a id="pl.51.17"></a><var>51.17</var>    (3) the amount paid to others, less the amount used to claim the credit allowed under <br/>
<a id="pl.51.18"></a><var>51.18</var>section 
         <statute_ref>290.0674</statute_ref>, not to exceed $1,625 for each qualifying child in grades kindergarten <br/>
<a id="pl.51.19"></a><var>51.19</var>to 6 and $2,500 for each qualifying child in grades 7 to 12, for tuition, textbooks, and <br/>
<a id="pl.51.20"></a><var>51.20</var>transportation of each qualifying child in attending an elementary or secondary school <br/>
<a id="pl.51.21"></a><var>51.21</var>situated in Minnesota, North Dakota, South Dakota, Iowa, or Wisconsin, wherein a <br/>
<a id="pl.51.22"></a><var>51.22</var>resident of this state may legally fulfill the state's compulsory attendance laws, which <br/>
<a id="pl.51.23"></a><var>51.23</var>is not operated for profit, and which adheres to the provisions of the Civil Rights Act <br/>
<a id="pl.51.24"></a><var>51.24</var>of 1964 and chapter 363A. For the purposes of this clause, "tuition" includes fees or <br/>
<a id="pl.51.25"></a><var>51.25</var>tuition as defined in section 
         <statute_ref>290.0674, subdivision 1</statute_ref>, clause (1). As used in this clause, <br/>
<a id="pl.51.26"></a><var>51.26</var>"textbooks" includes books and other instructional materials and equipment purchased <br/>
<a id="pl.51.27"></a><var>51.27</var>or leased for use in elementary and secondary schools in teaching only those subjects <br/>
<a id="pl.51.28"></a><var>51.28</var>legally and commonly taught in public elementary and secondary schools in this state. <br/>
<a id="pl.51.29"></a><var>51.29</var>Equipment expenses qualifying for deduction includes expenses as defined and limited in <br/>
<a id="pl.51.30"></a><var>51.30</var>section 
         <statute_ref>290.0674, subdivision 1</statute_ref>, clause (3). "Textbooks" does not include instructional <br/>
<a id="pl.51.31"></a><var>51.31</var>books and materials used in the teaching of religious tenets, doctrines, or worship, the <br/>
<a id="pl.51.32"></a><var>51.32</var>purpose of which is to instill such tenets, doctrines, or worship, nor does it include books <br/>
<a id="pl.51.33"></a><var>51.33</var>or materials for, or transportation to, extracurricular activities including sporting events, <br/>
<a id="pl.51.34"></a><var>51.34</var>musical or dramatic events, speech activities, driver's education, or similar programs. For <br/>
<a id="pl.52.1"></a><var>52.1</var>purposes of the subtraction provided by this clause, "qualifying child" has the meaning <br/>
<a id="pl.52.2"></a><var>52.2</var>given in section 32(c)(3) of the Internal Revenue Code;<br/>
<a id="pl.52.3"></a><var>52.3</var>    (4) income as provided under section 
         <statute_ref>290.0802</statute_ref>;<br/>
<a id="pl.52.4"></a><var>52.4</var>    (5) to the extent included in federal adjusted gross income, income realized on <br/>
<a id="pl.52.5"></a><var>52.5</var>disposition of property exempt from tax under section 
         <statute_ref>290.491</statute_ref>;<br/>
<a id="pl.52.6"></a><var>52.6</var>    (6) to the extent not deducted or not deductible pursuant to section 408(d)(8)(E) <br/>
<a id="pl.52.7"></a><var>52.7</var>of the Internal Revenue Code in determining federal taxable income by an individual <br/>
<a id="pl.52.8"></a><var>52.8</var>who does not itemize deductions for federal income tax purposes for the taxable year, an <br/>
<a id="pl.52.9"></a><var>52.9</var>amount equal to 50 percent of the excess of charitable contributions over $500 allowable <br/>
<a id="pl.52.10"></a><var>52.10</var>as a deduction for the taxable year under section 170(a) of the Internal Revenue Code and <br/>
<a id="pl.52.11"></a><var>52.11</var>under the provisions of Public Law 109-1;<br/>
<a id="pl.52.12"></a><var>52.12</var>    (7) for taxable years beginning before January 1, 2008, the amount of the federal <br/>
<a id="pl.52.13"></a><var>52.13</var>small ethanol producer credit allowed under section 40(a)(3) of the Internal Revenue Code <br/>
<a id="pl.52.14"></a><var>52.14</var>which is included in gross income under section 87 of the Internal Revenue Code;<br/>
<a id="pl.52.15"></a><var>52.15</var>    (8) for individuals who are allowed a federal foreign tax credit for taxes that do not <br/>
<a id="pl.52.16"></a><var>52.16</var>qualify for a credit under section 
         <statute_ref>290.06, subdivision 22</statute_ref>, an amount equal to the carryover <br/>
<a id="pl.52.17"></a><var>52.17</var>of subnational foreign taxes for the taxable year, but not to exceed the total subnational <br/>
<a id="pl.52.18"></a><var>52.18</var>foreign taxes reported in claiming the foreign tax credit. For purposes of this clause, <br/>
<a id="pl.52.19"></a><var>52.19</var>"federal foreign tax credit" means the credit allowed under section 27 of the Internal <br/>
<a id="pl.52.20"></a><var>52.20</var>Revenue Code, and "carryover of subnational foreign taxes" equals the carryover allowed <br/>
<a id="pl.52.21"></a><var>52.21</var>under section 904(c) of the Internal Revenue Code minus national level foreign taxes to <br/>
<a id="pl.52.22"></a><var>52.22</var>the extent they exceed the federal foreign tax credit;<br/>
<a id="pl.52.23"></a><var>52.23</var>    (9) in each of the five tax years immediately following the tax year in which an <br/>
<a id="pl.52.24"></a><var>52.24</var>addition is required under subdivision 19a, clause (7), or 19c, clause (15), in the case <br/>
<a id="pl.52.25"></a><var>52.25</var>of a shareholder of a corporation that is an S corporation, an amount equal to one-fifth <br/>
<a id="pl.52.26"></a><var>52.26</var>of the delayed depreciation. For purposes of this clause, "delayed depreciation" means <br/>
<a id="pl.52.27"></a><var>52.27</var>the amount of the addition made by the taxpayer under subdivision 19a, clause (7), or <br/>
<a id="pl.52.28"></a><var>52.28</var>subdivision 19c, clause (15), in the case of a shareholder of an S corporation, minus the <br/>
<a id="pl.52.29"></a><var>52.29</var>positive value of any net operating loss under section 172 of the Internal Revenue Code <br/>
<a id="pl.52.30"></a><var>52.30</var>generated for the tax year of the addition. The resulting delayed depreciation cannot be <br/>
<a id="pl.52.31"></a><var>52.31</var>less than zero;<br/>
<a id="pl.52.32"></a><var>52.32</var>    (10) job opportunity building zone income as provided under section 
         <statute_ref>469.316</statute_ref>;<br/>
<a id="pl.52.33"></a><var>52.33</var>    (11) to the extent included in federal taxable income, the amount of compensation <br/>
<a id="pl.52.34"></a><var>52.34</var>paid to members of the Minnesota National Guard or other reserve components of the <br/>
<a id="pl.52.35"></a><var>52.35</var>United States military for active service performed in Minnesota, excluding compensation <br/>
<a id="pl.52.36"></a><var>52.36</var>for services performed under the Active Guard Reserve (AGR) program. For purposes of <br/>
<a id="pl.53.1"></a><var>53.1</var>this clause, "active service" means (i) state active service as defined in section 
         <statute_ref>190.05, <br/>
<a id="pl.53.2"></a><var>53.2</var>subdivision 5a
         </statute_ref>, clause (1); (ii) federally funded state active service as defined in section <br/>
<statute_ref><a id="pl.53.3"></a><var>53.3</var>190.05, subdivision 5b
         </statute_ref>; or (iii) federal active service as defined in section 
         <statute_ref>190.05, <br/>
<a id="pl.53.4"></a><var>53.4</var>subdivision 5c
         </statute_ref>, but "active service" excludes services performed exclusively for purposes <br/>
<a id="pl.53.5"></a><var>53.5</var>of basic combat training, advanced individual training, annual training, and periodic <br/>
<a id="pl.53.6"></a><var>53.6</var>inactive duty training; special training periodically made available to reserve members; <br/>
<a id="pl.53.7"></a><var>53.7</var>and service performed in accordance with section 
         <statute_ref>190.08, subdivision 3</statute_ref>;<br/>
<a id="pl.53.8"></a><var>53.8</var>    (12) to the extent included in federal taxable income, the amount of compensation <br/>
<a id="pl.53.9"></a><var>53.9</var>paid to Minnesota residents who are members of the armed forces of the United States or <br/>
<a id="pl.53.10"></a><var>53.10</var>United Nations for active duty performed outside Minnesota under United States Code, <br/>
<a id="pl.53.11"></a><var>53.11</var>title 10, section 101(d); United States Code, title 32, section 101(12); or the authority of <br/>
<a id="pl.53.12"></a><var>53.12</var>the United Nations;<br/>
<a id="pl.53.13"></a><var>53.13</var>    (13) an amount, not to exceed $10,000, equal to qualified expenses related to a <br/>
<a id="pl.53.14"></a><var>53.14</var>qualified donor's donation, while living, of one or more of the qualified donor's organs <br/>
<a id="pl.53.15"></a><var>53.15</var>to another person for human organ transplantation. For purposes of this clause, "organ" <br/>
<a id="pl.53.16"></a><var>53.16</var>means all or part of an individual's liver, pancreas, kidney, intestine, lung, or bone marrow; <br/>
<a id="pl.53.17"></a><var>53.17</var>"human organ transplantation" means the medical procedure by which transfer of a human <br/>
<a id="pl.53.18"></a><var>53.18</var>organ is made from the body of one person to the body of another person; "qualified <br/>
<a id="pl.53.19"></a><var>53.19</var>expenses" means unreimbursed expenses for both the individual and the qualified donor <br/>
<a id="pl.53.20"></a><var>53.20</var>for (i) travel, (ii) lodging, and (iii) lost wages net of sick pay, except that such expenses <br/>
<a id="pl.53.21"></a><var>53.21</var>may be subtracted under this clause only once; and "qualified donor" means the individual <br/>
<a id="pl.53.22"></a><var>53.22</var>or the individual's dependent, as defined in section 152 of the Internal Revenue Code. An <br/>
<a id="pl.53.23"></a><var>53.23</var>individual may claim the subtraction in this clause for each instance of organ donation for <br/>
<a id="pl.53.24"></a><var>53.24</var>transplantation during the taxable year in which the qualified expenses occur;<br/>
<a id="pl.53.25"></a><var>53.25</var>    (14) in each of the five tax years immediately following the tax year in which an <br/>
<a id="pl.53.26"></a><var>53.26</var>addition is required under subdivision 19a, clause (8), or 19c, clause (16), in the case of a <br/>
<a id="pl.53.27"></a><var>53.27</var>shareholder of a corporation that is an S corporation, an amount equal to one-fifth of the <br/>
<a id="pl.53.28"></a><var>53.28</var>addition made by the taxpayer under subdivision 19a, clause (8), or 19c, clause (16), in the <br/>
<a id="pl.53.29"></a><var>53.29</var>case of a shareholder of a corporation that is an S corporation, minus the positive value of <br/>
<a id="pl.53.30"></a><var>53.30</var>any net operating loss under section 172 of the Internal Revenue Code generated for the <br/>
<a id="pl.53.31"></a><var>53.31</var>tax year of the addition. If the net operating loss exceeds the addition for the tax year, a <br/>
<a id="pl.53.32"></a><var>53.32</var>subtraction is not allowed under this clause;<br/>
<a id="pl.53.33"></a><var>53.33</var>    (15) to the extent included in federal taxable income, compensation paid to a <br/>
<a id="pl.53.34"></a><var>53.34</var>nonresident who is a service member as defined in United States Code, title 10, section <br/>
<a id="pl.53.35"></a><var>53.35</var>101(a)(5), for military service as defined in the Service Member Civil Relief Act, Public <br/>
<a id="pl.53.36"></a><var>53.36</var>Law 108-189, section 101(2); and<br/>
<a id="pl.54.1"></a><var>54.1</var>    (16) international economic development zone income as provided under section <br/>
<statute_ref><a id="pl.54.2"></a><var>54.2</var>469.325
         </statute_ref>.<br/>
<a id="pl.54.3"></a><var>54.3</var><b>EFFECTIVE DATE.</b>This section is effective for tax years beginning after <br/>
<a id="pl.54.4"></a><var>54.4</var>December 31, 2007.<br/>
<br/>
<a id="bill.3.4.0"></a><a id="pl.54.5"></a><var>54.5</var>    Sec. 4. Minnesota Statutes 2006, section 290.01, subdivision 19c, is amended to read:<br/>
<a id="pl.54.6"></a><var>54.6</var>    Subd. 19c. <b>Corporations; additions to federal taxable income.</b> For corporations, <br/>
<a id="pl.54.7"></a><var>54.7</var>there shall be added to federal taxable income:<br/>
<a id="pl.54.8"></a><var>54.8</var>    (1) the amount of any deduction taken for federal income tax purposes for income, <br/>
<a id="pl.54.9"></a><var>54.9</var>excise, or franchise taxes based on net income or related minimum taxes, including but not <br/>
<a id="pl.54.10"></a><var>54.10</var>limited to the tax imposed under section 
         <statute_ref>290.0922</statute_ref>, paid by the corporation to Minnesota, <br/>
<a id="pl.54.11"></a><var>54.11</var>another state, a political subdivision of another state, the District of Columbia, or any <br/>
<a id="pl.54.12"></a><var>54.12</var>foreign country or possession of the United States;<br/>
<a id="pl.54.13"></a><var>54.13</var>    (2) interest not subject to federal tax upon obligations of: the United States, its <br/>
<a id="pl.54.14"></a><var>54.14</var>possessions, its agencies, or its instrumentalities; the state of Minnesota or any other <br/>
<a id="pl.54.15"></a><var>54.15</var>state, any of its political or governmental subdivisions, any of its municipalities, or any <br/>
<a id="pl.54.16"></a><var>54.16</var>of its governmental agencies or instrumentalities; the District of Columbia; or Indian <br/>
<a id="pl.54.17"></a><var>54.17</var>tribal governments;<br/>
<a id="pl.54.18"></a><var>54.18</var>    (3) exempt-interest dividends received as defined in section 852(b)(5) of the Internal <br/>
<a id="pl.54.19"></a><var>54.19</var>Revenue Code;<br/>
<a id="pl.54.20"></a><var>54.20</var>    (4) the amount of any net operating loss deduction taken for federal income tax <br/>
<a id="pl.54.21"></a><var>54.21</var>purposes under section 172 or 832(c)(10) of the Internal Revenue Code or operations loss <br/>
<a id="pl.54.22"></a><var>54.22</var>deduction under section 810 of the Internal Revenue Code;<br/>
<a id="pl.54.23"></a><var>54.23</var>    (5) the amount of any special deductions taken for federal income tax purposes <br/>
<a id="pl.54.24"></a><var>54.24</var>under sections 241 to 247 and 965 of the Internal Revenue Code;<br/>
<a id="pl.54.25"></a><var>54.25</var>    (6) losses from the business of mining, as defined in section 
         <statute_ref>290.05, subdivision 1</statute_ref>, <br/>
<a id="pl.54.26"></a><var>54.26</var>clause (a), that are not subject to Minnesota income tax;<br/>
<a id="pl.54.27"></a><var>54.27</var>    (7) the amount of any capital losses deducted for federal income tax purposes under <br/>
<a id="pl.54.28"></a><var>54.28</var>sections 1211 and 1212 of the Internal Revenue Code;<br/>
<a id="pl.54.29"></a><var>54.29</var>    (8) the exempt foreign trade income of a foreign sales corporation under sections <br/>
<a id="pl.54.30"></a><var>54.30</var>921(a) and 291 of the Internal Revenue Code;<br/>
<a id="pl.54.31"></a><var>54.31</var>    (9) the amount of percentage depletion deducted under sections 611 through 614 and <br/>
<a id="pl.54.32"></a><var>54.32</var>291 of the Internal Revenue Code;<br/>
<a id="pl.54.33"></a><var>54.33</var>    (10) for certified pollution control facilities placed in service in a taxable year <br/>
<a id="pl.54.34"></a><var>54.34</var>beginning before December 31, 1986, and for which amortization deductions were elected <br/>
<a id="pl.54.35"></a><var>54.35</var>under section 169 of the Internal Revenue Code of 1954, as amended through December <br/>
<a id="pl.55.1"></a><var>55.1</var>31, 1985, the amount of the amortization deduction allowed in computing federal taxable <br/>
<a id="pl.55.2"></a><var>55.2</var>income for those facilities;<br/>
<a id="pl.55.3"></a><var>55.3</var>    (11) the amount of any deemed dividend from a foreign operating corporation <br/>
<a id="pl.55.4"></a><var>55.4</var>determined pursuant to section 
         <statute_ref>290.17, subdivision 4</statute_ref>, paragraph (g);<br/>
<a id="pl.55.5"></a><var>55.5</var>    (12) the amount of a partner's pro rata share of net income which does not flow <br/>
<a id="pl.55.6"></a><var>55.6</var>through to the partner because the partnership elected to pay the tax on the income under <br/>
<a id="pl.55.7"></a><var>55.7</var>section 6242(a)(2) of the Internal Revenue Code;<br/>
<a id="pl.55.8"></a><var>55.8</var>    (13) the amount of net income excluded under section 114 of the Internal Revenue <br/>
<a id="pl.55.9"></a><var>55.9</var>Code;<br/>
<a id="pl.55.10"></a><var>55.10</var>    (14) any increase in subpart F income, as defined in section 952(a) of the Internal <br/>
<a id="pl.55.11"></a><var>55.11</var>Revenue Code, for the taxable year when subpart F income is calculated without regard <br/>
<a id="pl.55.12"></a><var>55.12</var>to the provisions of section 103 of Public Law 109-222;<br/>
<a id="pl.55.13"></a><var>55.13</var>    (15) 80 percent of the depreciation deduction allowed under section 168(k)(1)(A) <br/>
<a id="pl.55.14"></a><var>55.14</var>and (k)(4)(A) of the Internal Revenue Code. For purposes of this clause, if the taxpayer <br/>
<a id="pl.55.15"></a><var>55.15</var>has an activity that in the taxable year generates a deduction for depreciation under <br/>
<a id="pl.55.16"></a><var>55.16</var>section 168(k)(1)(A) and (k)(4)(A) and the activity generates a loss for the taxable year <br/>
<a id="pl.55.17"></a><var>55.17</var>that the taxpayer is not allowed to claim for the taxable year, "the depreciation allowed <br/>
<a id="pl.55.18"></a><var>55.18</var>under section 168(k)(1)(A) and (k)(4)(A)" for the taxable year is limited to excess of the <br/>
<a id="pl.55.19"></a><var>55.19</var>depreciation claimed by the activity under section 168(k)(1)(A) and (k)(4)(A) over the <br/>
<a id="pl.55.20"></a><var>55.20</var>amount of the loss from the activity that is not allowed in the taxable year. In succeeding <br/>
<a id="pl.55.21"></a><var>55.21</var>taxable years when the losses not allowed in the taxable year are allowed, the depreciation <br/>
<a id="pl.55.22"></a><var>55.22</var>under section 168(k)(1)(A) and (k)(4)(A) is allowed;<br/>
<a id="pl.55.23"></a><var>55.23</var>    (16) 80 percent of the amount by which the deduction allowed by section 179 of the <br/>
<a id="pl.55.24"></a><var>55.24</var>Internal Revenue Code exceeds the deduction allowable by section 179 of the Internal <br/>
<a id="pl.55.25"></a><var>55.25</var>Revenue Code of 1986, as amended through December 31, 2003;<br/>
<a id="pl.55.26"></a><var>55.26</var>    (17) to the extent deducted in computing federal taxable income, the amount of the <br/>
<a id="pl.55.27"></a><var>55.27</var>deduction allowable under section 199 of the Internal Revenue Code; and<br/>
<a id="pl.55.28"></a><var>55.28</var>    (18) the exclusion allowed under section 139A of the Internal Revenue Code for <br/>
<a id="pl.55.29"></a><var>55.29</var>federal subsidies for prescription drug plans.; and<br/>
<a id="pl.55.30"></a><var>55.30</var>    (19) the amount of expenses disallowed under section 290.10, subdivision 2.<br/>
<a id="pl.55.31"></a><var>55.31</var><b>EFFECTIVE DATE.</b>This section is effective for taxable years beginning after <br/>
<a id="pl.55.32"></a><var>55.32</var>December 31, 2007, for disallowed expenses assessed after the date of final enactment <br/>
<a id="pl.55.33"></a><var>55.33</var>of this act.<br/>
<br/>
<a id="bill.3.5.0"></a><a id="pl.55.34"></a><var>55.34</var>    Sec. 5. Minnesota Statutes 2006, section 290.0677, subdivision 1, is amended to read:<br/>
<a id="pl.56.1"></a><var>56.1</var>    Subdivision 1. <b>Credit allowed. </b> (a) An individual is allowed a credit against the tax <br/>
<a id="pl.56.2"></a><var>56.2</var>due under this chapter equal to $59 for each month or portion thereof that the individual <br/>
<a id="pl.56.3"></a><var>56.3</var>was in active military service in a designated area after September 11, 2001, while a <br/>
<a id="pl.56.4"></a><var>56.4</var>Minnesota domiciliary. <br/>
<a id="pl.56.5"></a><var>56.5</var>    (b) For active service performed after September 11, 2001, and before December 31, <br/>
<a id="pl.56.6"></a><var>56.6</var>2006, the individual may claim the credit in the taxable year beginning after December 31, <br/>
<a id="pl.56.7"></a><var>56.7</var>2005, and before January 1, 2007. <br/>
<a id="pl.56.8"></a><var>56.8</var>    (c) For active service performed after December 31, 2006, the individual may claim <br/>
<a id="pl.56.9"></a><var>56.9</var>the credit for the taxable year in which the active service was performed. <br/>
<a id="pl.56.10"></a><var>56.10</var>    (d) If a Minnesota domiciliary is killed while performing active military service in a <br/>
<a id="pl.56.11"></a><var>56.11</var>designated area, the individual's surviving spouse or dependent child may take the credit <br/>
<a id="pl.56.12"></a><var>56.12</var>in the taxable year of the death. If a Minnesota domiciliary was killed while performing <br/>
<a id="pl.56.13"></a><var>56.13</var>active military service in a designated area between September 11, 2001, and December <br/>
<a id="pl.56.14"></a><var>56.14</var>31, 2006, the individual's surviving spouse or dependent child may claim this credit in <br/>
<a id="pl.56.15"></a><var>56.15</var>the taxable year beginning after December 31, 2005, and before January 1, 2007 an <br/>
<a id="pl.56.16"></a><var>56.16</var>individual entitled to the credit died prior to January 1, 2006, the individual's estate or <br/>
<a id="pl.56.17"></a><var>56.17</var>heirs at law, if the individual's probate estate has closed or the estate was not probated, <br/>
<a id="pl.56.18"></a><var>56.18</var>may claim the credit. <br/>
<a id="pl.56.19"></a><var>56.19</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for tax years beginning <br/>
<a id="pl.56.20"></a><var>56.20</var>after December 31, 2005.<br/>
<br/>
<a id="bill.3.6.0"></a><a id="pl.56.21"></a><var>56.21</var>    Sec. 6. Minnesota Statutes 2006, section 290.10, is amended to read:<br/>
<a id="pl.56.22"></a><var>56.22</var><b>290.10 NONDEDUCTIBLE ITEMS.</b><br/>
<a id="pl.56.23"></a><var>56.23</var>    Subdivision 1. <b>Expenses, interest, and taxes.</b> Except as provided in section 
         <statute_ref>290.17, <br/>
<a id="pl.56.24"></a><var>56.24</var>subdivision 4
         </statute_ref>, paragraph (i), in computing the net income of a taxpayer no deduction <br/>
<a id="pl.56.25"></a><var>56.25</var>shall in any case be allowed for expenses, interest and taxes connected with or allocable <br/>
<a id="pl.56.26"></a><var>56.26</var>against the production or receipt of all income not included in the measure of the tax <br/>
<a id="pl.56.27"></a><var>56.27</var>imposed by this chapter, except that for corporations engaged in the business of mining <br/>
<a id="pl.56.28"></a><var>56.28</var>or producing iron ore, the mining of which is subject to the occupation tax imposed by <br/>
<a id="pl.56.29"></a><var>56.29</var>section 
         <statute_ref>298.01, subdivision 4</statute_ref>, this shall not prevent the deduction of expenses and other <br/>
<a id="pl.56.30"></a><var>56.30</var>items to the extent that the expenses and other items are allowable under this chapter and <br/>
<a id="pl.56.31"></a><var>56.31</var>are not deductible, capitalizable, retainable in basis, or taken into account by allowance <br/>
<a id="pl.56.32"></a><var>56.32</var>or otherwise in computing the occupation tax and do not exceed the amounts taken for <br/>
<a id="pl.56.33"></a><var>56.33</var>federal income tax purposes for that year.  Occupation taxes imposed under chapter 298, <br/>
<a id="pl.57.1"></a><var>57.1</var>royalty taxes imposed under chapter 299, or depletion expenses may not be deducted <br/>
<a id="pl.57.2"></a><var>57.2</var>under this clause  subdivision.<br/>
<a id="pl.57.3"></a><var>57.3</var>    Subd. 2. <b>Fines, fees, and penalties.</b> (a) Except as provided in this subdivision, no <br/>
<a id="pl.57.4"></a><var>57.4</var>deduction from taxable income for a trade or business expense under section 162(a) of <br/>
<a id="pl.57.5"></a><var>57.5</var>the Internal Revenue Code shall be allowed for any amount paid or incurred, whether by <br/>
<a id="pl.57.6"></a><var>57.6</var>suit, agreement, or otherwise, to, or at the direction of, a government or entity described in <br/>
<a id="pl.57.7"></a><var>57.7</var>paragraph (d) in relation to the violation of any law or the investigation or inquiry by such <br/>
<a id="pl.57.8"></a><var>57.8</var>government or entity into the potential violation of any law.<br/>
<a id="pl.57.9"></a><var>57.9</var>    (b) Exception for amounts constituting restitution or paid to come into compliance <br/>
<a id="pl.57.10"></a><var>57.10</var>with the law. Paragraph (a) does not apply to any amount which:<br/>
<a id="pl.57.11"></a><var>57.11</var>    (1) the taxpayer establishes:<br/>
<a id="pl.57.12"></a><var>57.12</var>    (i) constitutes restitution, including remediation of property for damage or harm <br/>
<a id="pl.57.13"></a><var>57.13</var>caused by or which may be caused by the violation of any law or the potential violation <br/>
<a id="pl.57.14"></a><var>57.14</var>of any law; or<br/>
<a id="pl.57.15"></a><var>57.15</var>    (ii) is paid to come into compliance with any law which was violated or involved in <br/>
<a id="pl.57.16"></a><var>57.16</var>the investigation or inquiry; and<br/>
<a id="pl.57.17"></a><var>57.17</var>    (2) is identified as restitution or as an amount paid to come into compliance with the <br/>
<a id="pl.57.18"></a><var>57.18</var>law, as the case may be, in the court order or settlement agreement.<br/>
<a id="pl.57.19"></a><var>57.19</var>    This paragraph does not apply to any amount paid or incurred as reimbursement to <br/>
<a id="pl.57.20"></a><var>57.20</var>the government or entity for the costs of any investigation or litigation.<br/>
<a id="pl.57.21"></a><var>57.21</var>    (c) Paragraph (a) does not apply to any amount paid or incurred by order of a court <br/>
<a id="pl.57.22"></a><var>57.22</var>in a suit in which no government or entity described in paragraph (d) is a party.<br/>
<a id="pl.57.23"></a><var>57.23</var>    (d) An entity is described in this paragraph if it is:<br/>
<a id="pl.57.24"></a><var>57.24</var>    (1) a nongovernmental entity which exercises self-regulatory powers, including <br/>
<a id="pl.57.25"></a><var>57.25</var>imposing sanctions, in connection with a qualified board or exchange, as defined in section <br/>
<a id="pl.57.26"></a><var>57.26</var>1256(g)(7) of the Internal Revenue Code, or;<br/>
<a id="pl.57.27"></a><var>57.27</var>    (2) to the extent provided in federal regulations, a nongovernmental entity which <br/>
<a id="pl.57.28"></a><var>57.28</var>exercises self-regulatory powers, including imposing sanctions, as part of performing an <br/>
<a id="pl.57.29"></a><var>57.29</var>essential governmental function.<br/>
<a id="pl.57.30"></a><var>57.30</var>    (e) Paragraph (a) does not apply to any amount paid or incurred as taxes due.<br/>
<a id="pl.57.31"></a><var>57.31</var><b>EFFECTIVE DATE.</b>This section is effective for taxable years beginning after <br/>
<a id="pl.57.32"></a><var>57.32</var>December 31, 2007, and for fines, fees, and penalties assessed after the date of enactment.<br/>
<br/>
<a id="bill.3.7.0"></a><a id="pl.57.33"></a><var>57.33</var>    Sec. 7. Minnesota Statutes 2006, section 290.17, subdivision 2, is amended to read:<br/>
<a id="pl.58.1"></a><var>58.1</var>    Subd. 2. <b>Income not derived from conduct of a trade or business.</b> The income of <br/>
<a id="pl.58.2"></a><var>58.2</var>a taxpayer subject to the allocation rules that is not derived from the conduct of a trade or <br/>
<a id="pl.58.3"></a><var>58.3</var>business must be assigned in accordance with paragraphs (a) to (f):<br/>
<a id="pl.58.4"></a><var>58.4</var>    (a)(1) Subject to paragraphs (a)(2), and (a)(3), and (a)(4), income from wages as <br/>
<a id="pl.58.5"></a><var>58.5</var>defined in section 3401(a) and (f) of the Internal Revenue Code is assigned to this state if, <br/>
<a id="pl.58.6"></a><var>58.6</var>and to the extent that, the work of the employee is performed within it; all other income <br/>
<a id="pl.58.7"></a><var>58.7</var>from such sources is treated as income from sources without this state.<br/>
<a id="pl.58.8"></a><var>58.8</var>    Severance pay shall be considered income from labor or personal or professional <br/>
<a id="pl.58.9"></a><var>58.9</var>services.<br/>
<a id="pl.58.10"></a><var>58.10</var>    (2) In the case of an individual who is a nonresident of Minnesota and who is an <br/>
<a id="pl.58.11"></a><var>58.11</var>athlete or entertainer, income from compensation for labor or personal services performed <br/>
<a id="pl.58.12"></a><var>58.12</var>within this state shall be determined in the following manner:<br/>
<a id="pl.58.13"></a><var>58.13</var>    (i) The amount of income to be assigned to Minnesota for an individual who is a <br/>
<a id="pl.58.14"></a><var>58.14</var>nonresident salaried athletic team employee shall be determined by using a fraction in <br/>
<a id="pl.58.15"></a><var>58.15</var>which the denominator contains the total number of days in which the individual is under <br/>
<a id="pl.58.16"></a><var>58.16</var>a duty to perform for the employer, and the numerator is the total number of those days <br/>
<a id="pl.58.17"></a><var>58.17</var>spent in Minnesota. For purposes of this paragraph, off-season training activities, unless <br/>
<a id="pl.58.18"></a><var>58.18</var>conducted at the team's facilities as part of a team imposed program, are not included in <br/>
<a id="pl.58.19"></a><var>58.19</var>the total number of duty days. Bonuses earned as a result of play during the regular season <br/>
<a id="pl.58.20"></a><var>58.20</var>or for participation in championship, play-off, or all-star games must be allocated under <br/>
<a id="pl.58.21"></a><var>58.21</var>the formula. Signing bonuses are not subject to allocation under the formula if they are <br/>
<a id="pl.58.22"></a><var>58.22</var>not conditional on playing any games for the team, are payable separately from any other <br/>
<a id="pl.58.23"></a><var>58.23</var>compensation, and are nonrefundable; and<br/>
<a id="pl.58.24"></a><var>58.24</var>    (ii) The amount of income to be assigned to Minnesota for an individual who is a <br/>
<a id="pl.58.25"></a><var>58.25</var>nonresident, and who is an athlete or entertainer not listed in clause (i), for that person's <br/>
<a id="pl.58.26"></a><var>58.26</var>athletic or entertainment performance in Minnesota shall be determined by assigning to <br/>
<a id="pl.58.27"></a><var>58.27</var>this state all income from performances or athletic contests in this state.<br/>
<a id="pl.58.28"></a><var>58.28</var>    (3) For purposes of this section, amounts received by a nonresident as "retirement <br/>
<a id="pl.58.29"></a><var>58.29</var>income" as defined in section (b)(1) of the State Income Taxation of Pension Income <br/>
<a id="pl.58.30"></a><var>58.30</var>Act, Public Law 104-95, are not considered income derived from carrying on a trade <br/>
<a id="pl.58.31"></a><var>58.31</var>or business or from wages or other compensation for work an employee performed in <br/>
<a id="pl.58.32"></a><var>58.32</var>Minnesota, and are not taxable under this chapter.<br/>
<a id="pl.58.33"></a><var>58.33</var>    (4) Wages, otherwise assigned to this state under clause (1) and not qualifying under <br/>
<a id="pl.58.34"></a><var>58.34</var>clause (3), are not taxable under this chapter if the following conditions are met:<br/>
<a id="pl.58.35"></a><var>58.35</var>    (i) the recipient was not a resident of this state for any part of the taxable year in <br/>
<a id="pl.58.36"></a><var>58.36</var>which the wages were received; and<br/>
<a id="pl.59.1"></a><var>59.1</var>    (ii) the wages are for work performed while the recipient was a resident of this state.<br/>
<a id="pl.59.2"></a><var>59.2</var>    (b) Income or gains from tangible property located in this state that is not employed <br/>
<a id="pl.59.3"></a><var>59.3</var>in the business of the recipient of the income or gains must be assigned to this state.<br/>
<a id="pl.59.4"></a><var>59.4</var>    (c) Income or gains from intangible personal property not employed in the business <br/>
<a id="pl.59.5"></a><var>59.5</var>of the recipient of the income or gains must be assigned to this state if the recipient of the <br/>
<a id="pl.59.6"></a><var>59.6</var>income or gains is a resident of this state or is a resident trust or estate.<br/>
<a id="pl.59.7"></a><var>59.7</var>    Gain on the sale of a partnership interest is allocable to this state in the ratio of the <br/>
<a id="pl.59.8"></a><var>59.8</var>original cost of partnership tangible property in this state to the original cost of partnership <br/>
<a id="pl.59.9"></a><var>59.9</var>tangible property everywhere, determined at the time of the sale. If more than 50 percent <br/>
<a id="pl.59.10"></a><var>59.10</var>of the value of the partnership's assets consists of intangibles, gain or loss from the sale <br/>
<a id="pl.59.11"></a><var>59.11</var>of the partnership interest is allocated to this state in accordance with the sales factor of <br/>
<a id="pl.59.12"></a><var>59.12</var>the partnership for its first full tax period immediately preceding the tax period of the <br/>
<a id="pl.59.13"></a><var>59.13</var>partnership during which the partnership interest was sold.<br/>
<a id="pl.59.14"></a><var>59.14</var>    Gain on the sale of goodwill or income from a covenant not to compete that is <br/>
<a id="pl.59.15"></a><var>59.15</var>connected with a business operating all or partially in Minnesota is allocated to this state <br/>
<a id="pl.59.16"></a><var>59.16</var>to the extent that the income from the business in the year preceding the year of sale was <br/>
<a id="pl.59.17"></a><var>59.17</var>assignable to Minnesota under subdivision 3.<br/>
<a id="pl.59.18"></a><var>59.18</var>    When an employer pays an employee for a covenant not to compete, the income <br/>
<a id="pl.59.19"></a><var>59.19</var>allocated to this state is in the ratio of the employee's service in Minnesota in the calendar <br/>
<a id="pl.59.20"></a><var>59.20</var>year preceding leaving the employment of the employer over the total services performed <br/>
<a id="pl.59.21"></a><var>59.21</var>by the employee for the employer in that year.<br/>
<a id="pl.59.22"></a><var>59.22</var>    (d) Income from winnings on a bet made by an individual while in Minnesota is <br/>
<a id="pl.59.23"></a><var>59.23</var>assigned to this state. In this paragraph, "bet" has the meaning given in section 
         <statute_ref>609.75, <br/>
<a id="pl.59.24"></a><var>59.24</var>subdivision 2
         </statute_ref>, as limited by section 
         <statute_ref>609.75, subdivision 3</statute_ref>, clauses (1), (2), and (3). <br/>
<a id="pl.59.25"></a><var>59.25</var>    (e) All items of gross income not covered in paragraphs (a) to (d) and not part of the <br/>
<a id="pl.59.26"></a><var>59.26</var>taxpayer's income from a trade or business shall be assigned to the taxpayer's domicile.<br/>
<a id="pl.59.27"></a><var>59.27</var>    (f) For the purposes of this section, working as an employee shall not be considered <br/>
<a id="pl.59.28"></a><var>59.28</var>to be conducting a trade or business.<br/>
<a id="pl.59.29"></a><var>59.29</var><b>EFFECTIVE DATE.</b>This section is effective for taxable years beginning after <br/>
<a id="pl.59.30"></a><var>59.30</var>December 31, 2007.<br/>
<br/>
<a id="bill.3.8.0"></a><a id="pl.59.31"></a><var>59.31</var>    Sec. 8. Minnesota Statutes 2006, section 290.92, is amended by adding a subdivision <br/>
<a id="pl.59.32"></a><var>59.32</var>to read:<br/>
<a id="pl.59.33"></a><var>59.33</var>    Subd. 31. <b>Payments to persons who are not employees.</b> (a) For purposes of this <br/>
<a id="pl.59.34"></a><var>59.34</var>subdivision, "contractor" means a person carrying on a trade or business described in <br/>
<a id="pl.60.1"></a><var>60.1</var>industry code numbers 23 through 238990 of the North American Industry Classification <br/>
<a id="pl.60.2"></a><var>60.2</var>System. <br/>
<a id="pl.60.3"></a><var>60.3</var>    (b) A contractor or a third-party bulk filer acting on behalf of a contractor, who <br/>
<a id="pl.60.4"></a><var>60.4</var>makes payments to an individual, carrying on a trade or business described in paragraph <br/>
<a id="pl.60.5"></a><var>60.5</var>(a) as a sole proprietorship, must deduct and withhold two percent of the payment as <br/>
<a id="pl.60.6"></a><var>60.6</var>Minnesota withholding tax when the amount the contractor paid to that individual during <br/>
<a id="pl.60.7"></a><var>60.7</var>the calendar year exceeds $600.<br/>
<a id="pl.60.8"></a><var>60.8</var>    (c) A payment subject to withholding under this subdivision must be treated as if <br/>
<a id="pl.60.9"></a><var>60.9</var>the payment were a wage paid by an employer to an employee. The requirements in the <br/>
<a id="pl.60.10"></a><var>60.10</var>definitions of "employee" and "employer" in subdivision 1 relating to geographic location <br/>
<a id="pl.60.11"></a><var>60.11</var>apply in determining whether withholding tax applies under this subdivision, but without <br/>
<a id="pl.60.12"></a><var>60.12</var>regard to whether the contractor or the individual otherwise satisfy the definition of an <br/>
<a id="pl.60.13"></a><var>60.13</var>employer or an employee. Each recipient of a payment subject to withholding under this <br/>
<a id="pl.60.14"></a><var>60.14</var>subdivision must furnish the contractor with a statement of the recipient's name, address, <br/>
<a id="pl.60.15"></a><var>60.15</var>and Social Security account number.<br/>
<a id="pl.60.16"></a><var>60.16</var><b>EFFECTIVE DATE.</b>This section is effective for payments made after December <br/>
<a id="pl.60.17"></a><var>60.17</var>31, 2008.<br/>
<br/>
<a id="bill.3.9.0"></a><a id="pl.60.18"></a><var>60.18</var>    Sec. 9. <b>AUDIT AND REPORT TO LEGISLATURE.</b><br/>
<a id="pl.60.19"></a><var>60.19</var>    The commissioner must conduct a random sample audit of withholdings under <br/>
<a id="pl.60.20"></a><var>60.20</var>Minnesota Statutes, section 290.92, subdivision 31, and returns associated with those <br/>
<a id="pl.60.21"></a><var>60.21</var>withholdings. The commissioner must report on the findings of the audit to the committees <br/>
<a id="pl.60.22"></a><var>60.22</var>of the senate and house of representatives with jurisdiction over taxes, in compliance with <br/>
<a id="pl.60.23"></a><var>60.23</var>Minnesota Statutes, sections 3.195 and 3.197, no later than February 1, 2011. The report <br/>
<a id="pl.60.24"></a><var>60.24</var>must also include information on the number and amount of payments received, and on <br/>
<a id="pl.60.25"></a><var>60.25</var>the types of contractors making payments, grouped by specialty skills definitions provided <br/>
<a id="pl.60.26"></a><var>60.26</var>in the North American Industry Classification System.<br/>
<br/>
<a id="bill.4.0.0"></a>

<a id="bill.4.1.0"></a><a id="pl.60.29"></a><var>60.29</var>    Section 1. Minnesota Statutes 2006, section 289A.02, subdivision 7, is amended to <br/>
<a id="pl.60.30"></a><var>60.30</var>read:<br/>
<a id="pl.60.31"></a><var>60.31</var>    Subd. 7. <b>Internal Revenue Code.</b> Unless specifically defined otherwise, "Internal <br/>
<a id="pl.60.32"></a><var>60.32</var>Revenue Code" means the Internal Revenue Code of 1986, as amended through May 18, <br/>
<a id="pl.60.33"></a><var>60.33</var>2006 February 13, 2008.<br/>
<a id="pl.61.1"></a><var>61.1</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.4.2.0"></a><a id="pl.61.2"></a><var>61.2</var>    Sec. 2. Minnesota Statutes 2007 Supplement, section 290.01, subdivision 19, is <br/>
<a id="pl.61.3"></a><var>61.3</var>amended to read:<br/>
<a id="pl.61.4"></a><var>61.4</var>    Subd. 19. <b>Net income.</b> The term "net income" means the federal taxable income, <br/>
<a id="pl.61.5"></a><var>61.5</var>as defined in section 63 of the Internal Revenue Code of 1986, as amended through the <br/>
<a id="pl.61.6"></a><var>61.6</var>date named in this subdivision, incorporating the federal effective dates of changes to the <br/>
<a id="pl.61.7"></a><var>61.7</var>Internal Revenue Code and any elections made by the taxpayer in accordance with the <br/>
<a id="pl.61.8"></a><var>61.8</var>Internal Revenue Code in determining federal taxable income for federal income tax <br/>
<a id="pl.61.9"></a><var>61.9</var>purposes, and with the modifications provided in subdivisions 19a to 19f.<br/>
<a id="pl.61.10"></a><var>61.10</var>    In the case of a regulated investment company or a fund thereof, as defined in section <br/>
<a id="pl.61.11"></a><var>61.11</var>851(a) or 851(g) of the Internal Revenue Code, federal taxable income means investment <br/>
<a id="pl.61.12"></a><var>61.12</var>company taxable income as defined in section 852(b)(2) of the Internal Revenue Code, <br/>
<a id="pl.61.13"></a><var>61.13</var>except that:<br/>
<a id="pl.61.14"></a><var>61.14</var>    (1) the exclusion of net capital gain provided in section 852(b)(2)(A) of the Internal <br/>
<a id="pl.61.15"></a><var>61.15</var>Revenue Code does not apply;<br/>
<a id="pl.61.16"></a><var>61.16</var>    (2) the deduction for dividends paid under section 852(b)(2)(D) of the Internal <br/>
<a id="pl.61.17"></a><var>61.17</var>Revenue Code must be applied by allowing a deduction for capital gain dividends and <br/>
<a id="pl.61.18"></a><var>61.18</var>exempt-interest dividends as defined in sections 852(b)(3)(C) and 852(b)(5) of the Internal <br/>
<a id="pl.61.19"></a><var>61.19</var>Revenue Code; and<br/>
<a id="pl.61.20"></a><var>61.20</var>    (3) the deduction for dividends paid must also be applied in the amount of any <br/>
<a id="pl.61.21"></a><var>61.21</var>undistributed capital gains which the regulated investment company elects to have treated <br/>
<a id="pl.61.22"></a><var>61.22</var>as provided in section 852(b)(3)(D) of the Internal Revenue Code.<br/>
<a id="pl.61.23"></a><var>61.23</var>    The net income of a real estate investment trust as defined and limited by section <br/>
<a id="pl.61.24"></a><var>61.24</var>856(a), (b), and (c) of the Internal Revenue Code means the real estate investment trust <br/>
<a id="pl.61.25"></a><var>61.25</var>taxable income as defined in section 857(b)(2) of the Internal Revenue Code.<br/>
<a id="pl.61.26"></a><var>61.26</var>    The net income of a designated settlement fund as defined in section 468B(d) of <br/>
<a id="pl.61.27"></a><var>61.27</var>the Internal Revenue Code means the gross income as defined in section 468B(b) of the <br/>
<a id="pl.61.28"></a><var>61.28</var>Internal Revenue Code.<br/>
<a id="pl.61.29"></a><var>61.29</var>    The Internal Revenue Code of 1986, as amended through May 18, 2006 February <br/>
<a id="pl.61.30"></a><var>61.30</var>13, 2008, shall be in effect for taxable years beginning after December 31, 1996, and <br/>
<a id="pl.61.31"></a><var>61.31</var>before January 1, 2006, and for taxable years beginning after December 31, 2006. The <br/>
<a id="pl.61.32"></a><var>61.32</var>Internal Revenue Code of 1986, as amended through December 31, 2006, is in effect for <br/>
<a id="pl.61.33"></a><var>61.33</var>taxable years beginning after December 31, 2005, and before January 1, 2007.<br/>
<a id="pl.62.1"></a><var>62.1</var>    Except as otherwise provided, references to the Internal Revenue Code in <br/>
<a id="pl.62.2"></a><var>62.2</var>subdivisions 19 to 19f mean the code in effect for purposes of determining net income for <br/>
<a id="pl.62.3"></a><var>62.3</var>the applicable year.<br/>
<a id="pl.62.4"></a><var>62.4</var><b>EFFECTIVE DATE.</b>This section is effective for taxable years beginning after <br/>
<a id="pl.62.5"></a><var>62.5</var>December 31, 2006.<br/>
<br/>
<a id="bill.4.3.0"></a><a id="pl.62.6"></a><var>62.6</var>    Sec. 3. Minnesota Statutes 2006, section 290.01, subdivision 19a, is amended to read:<br/>
<a id="pl.62.7"></a><var>62.7</var>    Subd. 19a. <b>Additions to federal taxable income.</b> For individuals, estates, and <br/>
<a id="pl.62.8"></a><var>62.8</var>trusts, there shall be added to federal taxable income:<br/>
<a id="pl.62.9"></a><var>62.9</var>    (1)(i) interest income on obligations of any state other than Minnesota or a political <br/>
<a id="pl.62.10"></a><var>62.10</var>or governmental subdivision, municipality, or governmental agency or instrumentality <br/>
<a id="pl.62.11"></a><var>62.11</var>of any state other than Minnesota exempt from federal income taxes under the Internal <br/>
<a id="pl.62.12"></a><var>62.12</var>Revenue Code or any other federal statute; and<br/>
<a id="pl.62.13"></a><var>62.13</var>    (ii) exempt-interest dividends as defined in section 852(b)(5) of the Internal Revenue <br/>
<a id="pl.62.14"></a><var>62.14</var>Code, except the portion of the exempt-interest dividends derived from interest income <br/>
<a id="pl.62.15"></a><var>62.15</var>on obligations of the state of Minnesota or its political or governmental subdivisions, <br/>
<a id="pl.62.16"></a><var>62.16</var>municipalities, governmental agencies or instrumentalities, but only if the portion of the <br/>
<a id="pl.62.17"></a><var>62.17</var>exempt-interest dividends from such Minnesota sources paid to all shareholders represents <br/>
<a id="pl.62.18"></a><var>62.18</var>95 percent or more of the exempt-interest dividends that are paid by the regulated <br/>
<a id="pl.62.19"></a><var>62.19</var>investment company as defined in section 851(a) of the Internal Revenue Code, or the <br/>
<a id="pl.62.20"></a><var>62.20</var>fund of the regulated investment company as defined in section 851(g) of the Internal <br/>
<a id="pl.62.21"></a><var>62.21</var>Revenue Code, making the payment; and<br/>
<a id="pl.62.22"></a><var>62.22</var>    (iii) for the purposes of items (i) and (ii), interest on obligations of an Indian tribal <br/>
<a id="pl.62.23"></a><var>62.23</var>government described in section 7871(c) of the Internal Revenue Code shall be treated as <br/>
<a id="pl.62.24"></a><var>62.24</var>interest income on obligations of the state in which the tribe is located;<br/>
<a id="pl.62.25"></a><var>62.25</var>    (2) the amount of income or sales and use taxes paid or accrued within the taxable <br/>
<a id="pl.62.26"></a><var>62.26</var>year under this chapter and the amount of taxes based on net income paid or sales and use <br/>
<a id="pl.62.27"></a><var>62.27</var>taxes paid to any other state or to any province or territory of Canada, to the extent allowed <br/>
<a id="pl.62.28"></a><var>62.28</var>as a deduction under section 63(d) of the Internal Revenue Code, but the addition may not <br/>
<a id="pl.62.29"></a><var>62.29</var>be more than the amount by which the itemized deductions as allowed under section 63(d) <br/>
<a id="pl.62.30"></a><var>62.30</var>of the Internal Revenue Code exceeds the amount of the standard deduction as defined <br/>
<a id="pl.62.31"></a><var>62.31</var>in section 63(c) of the Internal Revenue Code. For the purpose of this paragraph, the <br/>
<a id="pl.62.32"></a><var>62.32</var>disallowance of itemized deductions under section 68 of the Internal Revenue Code of <br/>
<a id="pl.62.33"></a><var>62.33</var>1986, income or sales and use tax is the last itemized deduction disallowed;<br/>
<a id="pl.62.34"></a><var>62.34</var>    (3) the capital gain amount of a lump sum distribution to which the special tax under <br/>
<a id="pl.62.35"></a><var>62.35</var>section 1122(h)(3)(B)(ii) of the Tax Reform Act of 1986, Public Law 99-514, applies;<br/>
<a id="pl.63.1"></a><var>63.1</var>    (4) the amount of income taxes paid or accrued within the taxable year under this <br/>
<a id="pl.63.2"></a><var>63.2</var>chapter and taxes based on net income paid to any other state or any province or territory <br/>
<a id="pl.63.3"></a><var>63.3</var>of Canada, to the extent allowed as a deduction in determining federal adjusted gross <br/>
<a id="pl.63.4"></a><var>63.4</var>income. For the purpose of this paragraph, income taxes do not include the taxes imposed <br/>
<a id="pl.63.5"></a><var>63.5</var>by sections 
         <statute_ref>290.0922, subdivision 1</statute_ref>, paragraph (b), 
         <statute_ref>290.9727</statute_ref>, 
         <statute_ref>290.9728</statute_ref>, and 
         <statute_ref>290.9729</statute_ref>;<br/>
<a id="pl.63.6"></a><var>63.6</var>    (5) the amount of expense, interest, or taxes disallowed pursuant to section 
         <statute_ref>290.10</statute_ref> <br/>
<a id="pl.63.7"></a><var>63.7</var>other than expenses or interest used in computing net interest income for the subtraction <br/>
<a id="pl.63.8"></a><var>63.8</var>allowed under subdivision 19b, clause (1);<br/>
<a id="pl.63.9"></a><var>63.9</var>    (6) the amount of a partner's pro rata share of net income which does not flow <br/>
<a id="pl.63.10"></a><var>63.10</var>through to the partner because the partnership elected to pay the tax on the income under <br/>
<a id="pl.63.11"></a><var>63.11</var>section 6242(a)(2) of the Internal Revenue Code;<br/>
<a id="pl.63.12"></a><var>63.12</var>    (7) 80 percent of the depreciation deduction allowed under section 168(k) of the <br/>
<a id="pl.63.13"></a><var>63.13</var>Internal Revenue Code. For purposes of this clause, if the taxpayer has an activity that <br/>
<a id="pl.63.14"></a><var>63.14</var>in the taxable year generates a deduction for depreciation under section 168(k) and the <br/>
<a id="pl.63.15"></a><var>63.15</var>activity generates a loss for the taxable year that the taxpayer is not allowed to claim for <br/>
<a id="pl.63.16"></a><var>63.16</var>the taxable year, "the depreciation allowed under section 168(k)" for the taxable year is <br/>
<a id="pl.63.17"></a><var>63.17</var>limited to excess of the depreciation claimed by the activity under section 168(k) over the <br/>
<a id="pl.63.18"></a><var>63.18</var>amount of the loss from the activity that is not allowed in the taxable year. In succeeding <br/>
<a id="pl.63.19"></a><var>63.19</var>taxable years when the losses not allowed in the taxable year are allowed, the depreciation <br/>
<a id="pl.63.20"></a><var>63.20</var>under section 168(k) is allowed;<br/>
<a id="pl.63.21"></a><var>63.21</var>    (8) 80 percent of the amount by which the deduction allowed by section 179 of the <br/>
<a id="pl.63.22"></a><var>63.22</var>Internal Revenue Code exceeds the deduction allowable by section 179 of the Internal <br/>
<a id="pl.63.23"></a><var>63.23</var>Revenue Code of 1986, as amended through December 31, 2003;<br/>
<a id="pl.63.24"></a><var>63.24</var>    (9) to the extent deducted in computing federal taxable income, the amount of the <br/>
<a id="pl.63.25"></a><var>63.25</var>deduction allowable under section 199 of the Internal Revenue Code; and<br/>
<a id="pl.63.26"></a><var>63.26</var>    (10) the exclusion allowed under section 139A of the Internal Revenue Code for <br/>
<a id="pl.63.27"></a><var>63.27</var>federal subsidies for prescription drug plans.;<br/>
<a id="pl.63.28"></a><var>63.28</var>    (11) for taxable years beginning after December 31, 2006, and before January 1, <br/>
<a id="pl.63.29"></a><var>63.29</var>2008, the amount deducted for qualified tuition and related expenses under section 222 of <br/>
<a id="pl.63.30"></a><var>63.30</var>the Internal Revenue Code, to the extent deducted from gross income; and<br/>
<a id="pl.63.31"></a><var>63.31</var>    (12) for taxable years beginning after December 31, 2006, and before January 1, <br/>
<a id="pl.63.32"></a><var>63.32</var>2008, the amount deducted for certain expenses of elementary and secondary school <br/>
<a id="pl.63.33"></a><var>63.33</var>teachers under section 62(a)(2)(D) of the Internal Revenue Code, to the extent deducted <br/>
<a id="pl.63.34"></a><var>63.34</var>from gross income.<br/>
<a id="pl.63.35"></a><var>63.35</var><b>EFFECTIVE DATE.</b>This section is effective for taxable years beginning after <br/>
<a id="pl.63.36"></a><var>63.36</var>December 31, 2006.<br/>
<br/>
<a id="bill.4.4.0"></a><a id="pl.64.1"></a><var>64.1</var>    Sec. 4. Minnesota Statutes 2006, section 290.01, subdivision 19c, is amended to read:<br/>
<a id="pl.64.2"></a><var>64.2</var>    Subd. 19c. <b>Corporations; additions to federal taxable income.</b> For corporations, <br/>
<a id="pl.64.3"></a><var>64.3</var>there shall be added to federal taxable income:<br/>
<a id="pl.64.4"></a><var>64.4</var>    (1) the amount of any deduction taken for federal income tax purposes for income, <br/>
<a id="pl.64.5"></a><var>64.5</var>excise, or franchise taxes based on net income or related minimum taxes, including but not <br/>
<a id="pl.64.6"></a><var>64.6</var>limited to the tax imposed under section 
         <statute_ref>290.0922</statute_ref>, paid by the corporation to Minnesota, <br/>
<a id="pl.64.7"></a><var>64.7</var>another state, a political subdivision of another state, the District of Columbia, or any <br/>
<a id="pl.64.8"></a><var>64.8</var>foreign country or possession of the United States;<br/>
<a id="pl.64.9"></a><var>64.9</var>    (2) interest not subject to federal tax upon obligations of: the United States, its <br/>
<a id="pl.64.10"></a><var>64.10</var>possessions, its agencies, or its instrumentalities; the state of Minnesota or any other <br/>
<a id="pl.64.11"></a><var>64.11</var>state, any of its political or governmental subdivisions, any of its municipalities, or any <br/>
<a id="pl.64.12"></a><var>64.12</var>of its governmental agencies or instrumentalities; the District of Columbia; or Indian <br/>
<a id="pl.64.13"></a><var>64.13</var>tribal governments;<br/>
<a id="pl.64.14"></a><var>64.14</var>    (3) exempt-interest dividends received as defined in section 852(b)(5) of the Internal <br/>
<a id="pl.64.15"></a><var>64.15</var>Revenue Code;<br/>
<a id="pl.64.16"></a><var>64.16</var>    (4) the amount of any net operating loss deduction taken for federal income tax <br/>
<a id="pl.64.17"></a><var>64.17</var>purposes under section 172 or 832(c)(10) of the Internal Revenue Code or operations loss <br/>
<a id="pl.64.18"></a><var>64.18</var>deduction under section 810 of the Internal Revenue Code;<br/>
<a id="pl.64.19"></a><var>64.19</var>    (5) the amount of any special deductions taken for federal income tax purposes <br/>
<a id="pl.64.20"></a><var>64.20</var>under sections 241 to 247 and 965 of the Internal Revenue Code;<br/>
<a id="pl.64.21"></a><var>64.21</var>    (6) losses from the business of mining, as defined in section 
         <statute_ref>290.05, subdivision 1</statute_ref>, <br/>
<a id="pl.64.22"></a><var>64.22</var>clause (a), that are not subject to Minnesota income tax;<br/>
<a id="pl.64.23"></a><var>64.23</var>    (7) the amount of any capital losses deducted for federal income tax purposes under <br/>
<a id="pl.64.24"></a><var>64.24</var>sections 1211 and 1212 of the Internal Revenue Code;<br/>
<a id="pl.64.25"></a><var>64.25</var>    (8) the exempt foreign trade income of a foreign sales corporation under sections <br/>
<a id="pl.64.26"></a><var>64.26</var>921(a) and 291 of the Internal Revenue Code;<br/>
<a id="pl.64.27"></a><var>64.27</var>    (9) the amount of percentage depletion deducted under sections 611 through 614 and <br/>
<a id="pl.64.28"></a><var>64.28</var>291 of the Internal Revenue Code;<br/>
<a id="pl.64.29"></a><var>64.29</var>    (10) for certified pollution control facilities placed in service in a taxable year <br/>
<a id="pl.64.30"></a><var>64.30</var>beginning before December 31, 1986, and for which amortization deductions were elected <br/>
<a id="pl.64.31"></a><var>64.31</var>under section 169 of the Internal Revenue Code of 1954, as amended through December <br/>
<a id="pl.64.32"></a><var>64.32</var>31, 1985, the amount of the amortization deduction allowed in computing federal taxable <br/>
<a id="pl.64.33"></a><var>64.33</var>income for those facilities;<br/>
<a id="pl.64.34"></a><var>64.34</var>    (11) the amount of any deemed dividend from a foreign operating corporation <br/>
<a id="pl.64.35"></a><var>64.35</var>determined pursuant to section 
         <statute_ref>290.17, subdivision 4</statute_ref>, paragraph (g);<br/>
<a id="pl.65.1"></a><var>65.1</var>    (12) the amount of a partner's pro rata share of net income which does not flow <br/>
<a id="pl.65.2"></a><var>65.2</var>through to the partner because the partnership elected to pay the tax on the income under <br/>
<a id="pl.65.3"></a><var>65.3</var>section 6242(a)(2) of the Internal Revenue Code;<br/>
<a id="pl.65.4"></a><var>65.4</var>    (13) the amount of net income excluded under section 114 of the Internal Revenue <br/>
<a id="pl.65.5"></a><var>65.5</var>Code;<br/>
<a id="pl.65.6"></a><var>65.6</var>    (14) any increase in subpart F income, as defined in section 952(a) of the Internal <br/>
<a id="pl.65.7"></a><var>65.7</var>Revenue Code, for the taxable year when subpart F income is calculated without regard <br/>
<a id="pl.65.8"></a><var>65.8</var>to the provisions of section 103 of Public Law 109-222;<br/>
<a id="pl.65.9"></a><var>65.9</var>    (15) 80 percent of the depreciation deduction allowed under section 168(k)(1)(A) <br/>
<a id="pl.65.10"></a><var>65.10</var>and (k)(4)(A) of the Internal Revenue Code. For purposes of this clause, if the taxpayer <br/>
<a id="pl.65.11"></a><var>65.11</var>has an activity that in the taxable year generates a deduction for depreciation under <br/>
<a id="pl.65.12"></a><var>65.12</var>section 168(k)(1)(A) and (k)(4)(A) and the activity generates a loss for the taxable year <br/>
<a id="pl.65.13"></a><var>65.13</var>that the taxpayer is not allowed to claim for the taxable year, "the depreciation allowed <br/>
<a id="pl.65.14"></a><var>65.14</var>under section 168(k)(1)(A) and (k)(4)(A)" for the taxable year is limited to excess of the <br/>
<a id="pl.65.15"></a><var>65.15</var>depreciation claimed by the activity under section 168(k)(1)(A) and (k)(4)(A) over the <br/>
<a id="pl.65.16"></a><var>65.16</var>amount of the loss from the activity that is not allowed in the taxable year. In succeeding <br/>
<a id="pl.65.17"></a><var>65.17</var>taxable years when the losses not allowed in the taxable year are allowed, the depreciation <br/>
<a id="pl.65.18"></a><var>65.18</var>under section 168(k)(1)(A) and (k)(4)(A) is allowed;<br/>
<a id="pl.65.19"></a><var>65.19</var>    (16) 80 percent of the amount by which the deduction allowed by section 179 of the <br/>
<a id="pl.65.20"></a><var>65.20</var>Internal Revenue Code exceeds the deduction allowable by section 179 of the Internal <br/>
<a id="pl.65.21"></a><var>65.21</var>Revenue Code of 1986, as amended through December 31, 2003;<br/>
<a id="pl.65.22"></a><var>65.22</var>    (17) to the extent deducted in computing federal taxable income, the amount of the <br/>
<a id="pl.65.23"></a><var>65.23</var>deduction allowable under section 199 of the Internal Revenue Code; and<br/>
<a id="pl.65.24"></a><var>65.24</var>    (18) the exclusion allowed under section 139A of the Internal Revenue Code for <br/>
<a id="pl.65.25"></a><var>65.25</var>federal subsidies for prescription drug plans.; and<br/>
<a id="pl.65.26"></a><var>65.26</var>    (19) for taxable years beginning after December 31, 2006, and before January 1, <br/>
<a id="pl.65.27"></a><var>65.27</var>2008, the additional amount allowed as a deduction for donation of computer technology <br/>
<a id="pl.65.28"></a><var>65.28</var>and equipment under section 170(e)(6) of the Internal Revenue Code, to the extent <br/>
<a id="pl.65.29"></a><var>65.29</var>deducted from taxable income.<br/>
<a id="pl.65.30"></a><var>65.30</var><b>EFFECTIVE DATE.</b>This section is effective for taxable years beginning after <br/>
<a id="pl.65.31"></a><var>65.31</var>December 31, 2006.<br/>
<br/>
<a id="bill.4.5.0"></a><a id="pl.65.32"></a><var>65.32</var>    Sec. 5. Minnesota Statutes 2007 Supplement, section 290.01, subdivision 31, is <br/>
<a id="pl.65.33"></a><var>65.33</var>amended to read:<br/>
<a id="pl.65.34"></a><var>65.34</var>    Subd. 31. <b>Internal Revenue Code.</b> Unless specifically defined otherwise, for <br/>
<a id="pl.65.35"></a><var>65.35</var>taxable years beginning before January 1, 2006, and after December 31, 2006, "Internal <br/>
<a id="pl.66.1"></a><var>66.1</var>Revenue Code" means the Internal Revenue Code of 1986, as amended through May 18, <br/>
<a id="pl.66.2"></a><var>66.2</var>2006; and for taxable years beginning after December 31, 2005, and before January 1, <br/>
<a id="pl.66.3"></a><var>66.3</var>2007, "Internal Revenue Code" means the Internal Revenue Code of 1986, as amended <br/>
<a id="pl.66.4"></a><var>66.4</var>through December 31, 2006 February 13, 2008.<br/>
<a id="pl.66.5"></a><var>66.5</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment <br/>
<a id="pl.66.6"></a><var>66.6</var>except the changes incorporated by federal changes are effective at the same time as the <br/>
<a id="pl.66.7"></a><var>66.7</var>changes were effective for federal purposes.<br/>
<br/>
<a id="bill.4.6.0"></a><a id="pl.66.8"></a><var>66.8</var>    Sec. 6. Minnesota Statutes 2006, section 290.06, subdivision 2c, is amended to read:<br/>
<a id="pl.66.9"></a><var>66.9</var>    Subd. 2c. <b>Schedules of rates for individuals, estates, and trusts.</b> (a) The income <br/>
<a id="pl.66.10"></a><var>66.10</var>taxes imposed by this chapter upon married individuals filing joint returns and surviving <br/>
<a id="pl.66.11"></a><var>66.11</var>spouses as defined in section 2(a) of the Internal Revenue Code must be computed by <br/>
<a id="pl.66.12"></a><var>66.12</var>applying to their taxable net income the following schedule of rates:<br/>
<a id="pl.66.13"></a><var>66.13</var>    (1) On the first $25,680, 
         <statute_ref>5.35</statute_ref> percent;<br/>
<a id="pl.66.14"></a><var>66.14</var>    (2) On all over $25,680, but not over $102,030, 
         <statute_ref>7.05</statute_ref> percent;<br/>
<a id="pl.66.15"></a><var>66.15</var>    (3) On all over $102,030, 
         <statute_ref>7.85</statute_ref> percent.<br/>
<a id="pl.66.16"></a><var>66.16</var>    Married individuals filing separate returns, estates, and trusts must compute their <br/>
<a id="pl.66.17"></a><var>66.17</var>income tax by applying the above rates to their taxable income, except that the income <br/>
<a id="pl.66.18"></a><var>66.18</var>brackets will be one-half of the above amounts.<br/>
<a id="pl.66.19"></a><var>66.19</var>    (b) The income taxes imposed by this chapter upon unmarried individuals must be <br/>
<a id="pl.66.20"></a><var>66.20</var>computed by applying to taxable net income the following schedule of rates:<br/>
<a id="pl.66.21"></a><var>66.21</var>    (1) On the first $17,570, 
         <statute_ref>5.35</statute_ref> percent;<br/>
<a id="pl.66.22"></a><var>66.22</var>    (2) On all over $17,570, but not over $57,710, 
         <statute_ref>7.05</statute_ref> percent;<br/>
<a id="pl.66.23"></a><var>66.23</var>    (3) On all over $57,710, 
         <statute_ref>7.85</statute_ref> percent.<br/>
<a id="pl.66.24"></a><var>66.24</var>    (c) The income taxes imposed by this chapter upon unmarried individuals qualifying <br/>
<a id="pl.66.25"></a><var>66.25</var>as a head of household as defined in section 2(b) of the Internal Revenue Code must be <br/>
<a id="pl.66.26"></a><var>66.26</var>computed by applying to taxable net income the following schedule of rates:<br/>
<a id="pl.66.27"></a><var>66.27</var>    (1) On the first $21,630, 
         <statute_ref>5.35</statute_ref> percent;<br/>
<a id="pl.66.28"></a><var>66.28</var>    (2) On all over $21,630, but not over $86,910, 
         <statute_ref>7.05</statute_ref> percent;<br/>
<a id="pl.66.29"></a><var>66.29</var>    (3) On all over $86,910, 
         <statute_ref>7.85</statute_ref> percent.<br/>
<a id="pl.66.30"></a><var>66.30</var>    (d) In lieu of a tax computed according to the rates set forth in this subdivision, the <br/>
<a id="pl.66.31"></a><var>66.31</var>tax of any individual taxpayer whose taxable net income for the taxable year is less than <br/>
<a id="pl.66.32"></a><var>66.32</var>an amount determined by the commissioner must be computed in accordance with tables <br/>
<a id="pl.66.33"></a><var>66.33</var>prepared and issued by the commissioner of revenue based on income brackets of not <br/>
<a id="pl.66.34"></a><var>66.34</var>more than $100. The amount of tax for each bracket shall be computed at the rates set <br/>
<a id="pl.67.1"></a><var>67.1</var>forth in this subdivision, provided that the commissioner may disregard a fractional part of <br/>
<a id="pl.67.2"></a><var>67.2</var>a dollar unless it amounts to 50 cents or more, in which case it may be increased to $1.<br/>
<a id="pl.67.3"></a><var>67.3</var>    (e) An individual who is not a Minnesota resident for the entire year must compute <br/>
<a id="pl.67.4"></a><var>67.4</var>the individual's Minnesota income tax as provided in this subdivision. After the <br/>
<a id="pl.67.5"></a><var>67.5</var>application of the nonrefundable credits provided in this chapter, the tax liability must <br/>
<a id="pl.67.6"></a><var>67.6</var>then be multiplied by a fraction in which:<br/>
<a id="pl.67.7"></a><var>67.7</var>    (1) the numerator is the individual's Minnesota source federal adjusted gross income <br/>
<a id="pl.67.8"></a><var>67.8</var>as defined in section 62 of the Internal Revenue Code and increased by the additions <br/>
<a id="pl.67.9"></a><var>67.9</var>required under section 
         <statute_ref>290.01, subdivision 19a</statute_ref>, clauses (1), (5), (6), (7), (8), and (9), <br/>
<a id="pl.67.10"></a><var>67.10</var>(11), and (12) and reduced by the Minnesota assignable portion of the subtraction for <br/>
<a id="pl.67.11"></a><var>67.11</var>United States government interest under section 
         <statute_ref>290.01, subdivision 19b</statute_ref>, clause (1), <br/>
<a id="pl.67.12"></a><var>67.12</var>and the subtractions under section 
         <statute_ref>290.01, subdivision 19b</statute_ref>, clauses (9), (10), (14), (15), <br/>
<a id="pl.67.13"></a><var>67.13</var>and (16), after applying the allocation and assignability provisions of section 
         <statute_ref>290.081</statute_ref>, <br/>
<a id="pl.67.14"></a><var>67.14</var>clause (a), or 
         <statute_ref>290.17</statute_ref>; and<br/>
<a id="pl.67.15"></a><var>67.15</var>    (2) the denominator is the individual's federal adjusted gross income as defined in <br/>
<a id="pl.67.16"></a><var>67.16</var>section 62 of the Internal Revenue Code of 1986, increased by the amounts specified in <br/>
<a id="pl.67.17"></a><var>67.17</var>section 
         <statute_ref>290.01, subdivision 19a</statute_ref>, clauses (1), (5), (6), (7), (8), and (9), (11), and (12) and <br/>
<a id="pl.67.18"></a><var>67.18</var>reduced by the amounts specified in section 
         <statute_ref>290.01, subdivision 19b</statute_ref>, clauses (1), (9), <br/>
<a id="pl.67.19"></a><var>67.19</var>(10), (14), (15), and (16).<br/>
<a id="pl.67.20"></a><var>67.20</var><b>EFFECTIVE DATE.</b>This section is effective for taxable years beginning after <br/>
<a id="pl.67.21"></a><var>67.21</var>December 31, 2006.<br/>
<br/>
<a id="bill.4.7.0"></a><a id="pl.67.22"></a><var>67.22</var>    Sec. 7. Minnesota Statutes 2006, section 290.091, subdivision 2, is amended to read:<br/>
<a id="pl.67.23"></a><var>67.23</var>    Subd. 2. <b>Definitions.</b> For purposes of the tax imposed by this section, the following <br/>
<a id="pl.67.24"></a><var>67.24</var>terms have the meanings given:<br/>
<a id="pl.67.25"></a><var>67.25</var>    (a) "Alternative minimum taxable income" means the sum of the following for <br/>
<a id="pl.67.26"></a><var>67.26</var>the taxable year:<br/>
<a id="pl.67.27"></a><var>67.27</var>    (1) the taxpayer's federal alternative minimum taxable income as defined in section <br/>
<a id="pl.67.28"></a><var>67.28</var>55(b)(2) of the Internal Revenue Code;<br/>
<a id="pl.67.29"></a><var>67.29</var>    (2) the taxpayer's itemized deductions allowed in computing federal alternative <br/>
<a id="pl.67.30"></a><var>67.30</var>minimum taxable income, but excluding:<br/>
<a id="pl.67.31"></a><var>67.31</var>    (i) the charitable contribution deduction under section 170 of the Internal Revenue <br/>
<a id="pl.67.32"></a><var>67.32</var>Code:<br/>
<a id="pl.67.33"></a><var>67.33</var>    (A) for taxable years beginning before January 1, 2006, to the extent that the <br/>
<a id="pl.67.34"></a><var>67.34</var>deduction exceeds 1.0 percent of adjusted gross income;<br/>
<a id="pl.68.1"></a><var>68.1</var>    (B) for taxable years beginning after December 31, 2005, to the full extent of the <br/>
<a id="pl.68.2"></a><var>68.2</var>deduction.<br/>
<a id="pl.68.3"></a><var>68.3</var>    For purposes of this clause, "adjusted gross income" has the meaning given in <br/>
<a id="pl.68.4"></a><var>68.4</var>section 62 of the Internal Revenue Code;<br/>
<a id="pl.68.5"></a><var>68.5</var>    (ii) the medical expense deduction;<br/>
<a id="pl.68.6"></a><var>68.6</var>    (iii) the casualty, theft, and disaster loss deduction; and<br/>
<a id="pl.68.7"></a><var>68.7</var>    (iv) the impairment-related work expenses of a disabled person;<br/>
<a id="pl.68.8"></a><var>68.8</var>    (3) for depletion allowances computed under section 613A(c) of the Internal <br/>
<a id="pl.68.9"></a><var>68.9</var>Revenue Code, with respect to each property (as defined in section 614 of the Internal <br/>
<a id="pl.68.10"></a><var>68.10</var>Revenue Code), to the extent not included in federal alternative minimum taxable income, <br/>
<a id="pl.68.11"></a><var>68.11</var>the excess of the deduction for depletion allowable under section 611 of the Internal <br/>
<a id="pl.68.12"></a><var>68.12</var>Revenue Code for the taxable year over the adjusted basis of the property at the end of the <br/>
<a id="pl.68.13"></a><var>68.13</var>taxable year (determined without regard to the depletion deduction for the taxable year);<br/>
<a id="pl.68.14"></a><var>68.14</var>    (4) to the extent not included in federal alternative minimum taxable income, the <br/>
<a id="pl.68.15"></a><var>68.15</var>amount of the tax preference for intangible drilling cost under section 57(a)(2) of the <br/>
<a id="pl.68.16"></a><var>68.16</var>Internal Revenue Code determined without regard to subparagraph (E);<br/>
<a id="pl.68.17"></a><var>68.17</var>    (5) to the extent not included in federal alternative minimum taxable income, the <br/>
<a id="pl.68.18"></a><var>68.18</var>amount of interest income as provided by section 
         <statute_ref>290.01, subdivision 19a</statute_ref>, clause (1); and<br/>
<a id="pl.68.19"></a><var>68.19</var>    (6) the amount of addition required by section 
         <statute_ref>290.01, subdivision 19a</statute_ref>, clauses <br/>
<a id="pl.68.20"></a><var>68.20</var>(7), (8), and to (9), (11), and (12);<br/>
<a id="pl.68.21"></a><var>68.21</var>    less the sum of the amounts determined under the following:<br/>
<a id="pl.68.22"></a><var>68.22</var>    (1) interest income as defined in section 
         <statute_ref>290.01, subdivision 19b</statute_ref>, clause (1);<br/>
<a id="pl.68.23"></a><var>68.23</var>    (2) an overpayment of state income tax as provided by section 
         <statute_ref>290.01, subdivision <br/>
<a id="pl.68.24"></a><var>68.24</var>19b
         </statute_ref>, clause (2), to the extent included in federal alternative minimum taxable income;<br/>
<a id="pl.68.25"></a><var>68.25</var>    (3) the amount of investment interest paid or accrued within the taxable year on <br/>
<a id="pl.68.26"></a><var>68.26</var>indebtedness to the extent that the amount does not exceed net investment income, as <br/>
<a id="pl.68.27"></a><var>68.27</var>defined in section 163(d)(4) of the Internal Revenue Code. Interest does not include <br/>
<a id="pl.68.28"></a><var>68.28</var>amounts deducted in computing federal adjusted gross income; and<br/>
<a id="pl.68.29"></a><var>68.29</var>    (4) amounts subtracted from federal taxable income as provided by section 
         <statute_ref>290.01, <br/>
<a id="pl.68.30"></a><var>68.30</var>subdivision 19b
         </statute_ref>, clauses (9) to (16).<br/>
<a id="pl.68.31"></a><var>68.31</var>    In the case of an estate or trust, alternative minimum taxable income must be <br/>
<a id="pl.68.32"></a><var>68.32</var>computed as provided in section 59(c) of the Internal Revenue Code.<br/>
<a id="pl.68.33"></a><var>68.33</var>    (b) "Investment interest" means investment interest as defined in section 163(d)(3) <br/>
<a id="pl.68.34"></a><var>68.34</var>of the Internal Revenue Code.<br/>
<a id="pl.68.35"></a><var>68.35</var>    (c) "Tentative minimum tax" equals 6.4 percent of alternative minimum taxable <br/>
<a id="pl.68.36"></a><var>68.36</var>income after subtracting the exemption amount determined under subdivision 3.<br/>
<a id="pl.69.1"></a><var>69.1</var>    (d) "Regular tax" means the tax that would be imposed under this chapter (without <br/>
<a id="pl.69.2"></a><var>69.2</var>regard to this section and section 290.032), reduced by the sum of the nonrefundable <br/>
<a id="pl.69.3"></a><var>69.3</var>credits allowed under this chapter.<br/>
<a id="pl.69.4"></a><var>69.4</var>    (e) "Net minimum tax" means the minimum tax imposed by this section.<br/>
<a id="pl.69.5"></a><var>69.5</var><b>EFFECTIVE DATE.</b>This section is effective for taxable years beginning after <br/>
<a id="pl.69.6"></a><var>69.6</var>December 31, 2006.<br/>
<br/>
<a id="bill.4.8.0"></a><a id="pl.69.7"></a><var>69.7</var>    Sec. 8. Minnesota Statutes 2007 Supplement, section 290A.03, subdivision 15, is <br/>
<a id="pl.69.8"></a><var>69.8</var>amended to read:<br/>
<a id="pl.69.9"></a><var>69.9</var>    Subd. 15. <b>Internal Revenue Code.</b> For taxable years beginning before January 1, <br/>
<a id="pl.69.10"></a><var>69.10</var>2006, and after December 31, 2006, "Internal Revenue Code" means the Internal Revenue <br/>
<a id="pl.69.11"></a><var>69.11</var>Code of 1986, as amended through May 18, 2006; and for taxable years beginning after <br/>
<a id="pl.69.12"></a><var>69.12</var>December 31, 2005, and before January 1, 2007, "Internal Revenue Code" means the <br/>
<a id="pl.69.13"></a><var>69.13</var>Internal Revenue Code of 1986, as amended through December 31, 2006 February 13, <br/>
<a id="pl.69.14"></a><var>69.14</var>2008.<br/>
<a id="pl.69.15"></a><var>69.15</var><b>EFFECTIVE DATE.</b>This section is effective for property tax refunds based on <br/>
<a id="pl.69.16"></a><var>69.16</var>property taxes payable on or after December 31, 2007, and rent paid on or after December <br/>
<a id="pl.69.17"></a><var>69.17</var>31, 2006.<br/>
<br/>
<a id="bill.4.9.0"></a><a id="pl.69.18"></a><var>69.18</var>    Sec. 9. Minnesota Statutes 2006, section 291.005, subdivision 1, is amended to read:<br/>
<a id="pl.69.19"></a><var>69.19</var>    Subdivision 1. <b>Scope.</b> Unless the context otherwise clearly requires, the following <br/>
<a id="pl.69.20"></a><var>69.20</var>terms used in this chapter shall have the following meanings:<br/>
<a id="pl.69.21"></a><var>69.21</var>    (1) "Federal gross estate" means the gross estate of a decedent as valued and <br/>
<a id="pl.69.22"></a><var>69.22</var>otherwise determined for federal estate tax purposes by federal taxing authorities pursuant <br/>
<a id="pl.69.23"></a><var>69.23</var>to the provisions of the Internal Revenue Code.<br/>
<a id="pl.69.24"></a><var>69.24</var>    (2) "Minnesota gross estate" means the federal gross estate of a decedent after (a) <br/>
<a id="pl.69.25"></a><var>69.25</var>excluding therefrom any property included therein which has its situs outside Minnesota, <br/>
<a id="pl.69.26"></a><var>69.26</var>and (b) including therein any property omitted from the federal gross estate which is <br/>
<a id="pl.69.27"></a><var>69.27</var>includable therein, has its situs in Minnesota, and was not disclosed to federal taxing <br/>
<a id="pl.69.28"></a><var>69.28</var>authorities.<br/>
<a id="pl.69.29"></a><var>69.29</var>    (3) "Personal representative" means the executor, administrator or other person <br/>
<a id="pl.69.30"></a><var>69.30</var>appointed by the court to administer and dispose of the property of the decedent. If there <br/>
<a id="pl.69.31"></a><var>69.31</var>is no executor, administrator or other person appointed, qualified, and acting within this <br/>
<a id="pl.69.32"></a><var>69.32</var>state, then any person in actual or constructive possession of any property having a situs in <br/>
<a id="pl.69.33"></a><var>69.33</var>this state which is included in the federal gross estate of the decedent shall be deemed <br/>
<a id="pl.70.1"></a><var>70.1</var>to be a personal representative to the extent of the property and the Minnesota estate tax <br/>
<a id="pl.70.2"></a><var>70.2</var>due with respect to the property.<br/>
<a id="pl.70.3"></a><var>70.3</var>    (4) "Resident decedent" means an individual whose domicile at the time of death <br/>
<a id="pl.70.4"></a><var>70.4</var>was in Minnesota.<br/>
<a id="pl.70.5"></a><var>70.5</var>    (5) "Nonresident decedent" means an individual whose domicile at the time of <br/>
<a id="pl.70.6"></a><var>70.6</var>death was not in Minnesota.<br/>
<a id="pl.70.7"></a><var>70.7</var>    (6) "Situs of property" means, with respect to real property, the state or country in <br/>
<a id="pl.70.8"></a><var>70.8</var>which it is located; with respect to tangible personal property, the state or country in which <br/>
<a id="pl.70.9"></a><var>70.9</var>it was normally kept or located at the time of the decedent's death; and with respect to <br/>
<a id="pl.70.10"></a><var>70.10</var>intangible personal property, the state or country in which the decedent was domiciled <br/>
<a id="pl.70.11"></a><var>70.11</var>at death.<br/>
<a id="pl.70.12"></a><var>70.12</var>    (7) "Commissioner" means the commissioner of revenue or any person to whom the <br/>
<a id="pl.70.13"></a><var>70.13</var>commissioner has delegated functions under this chapter.<br/>
<a id="pl.70.14"></a><var>70.14</var>    (8) "Internal Revenue Code" means the United States Internal Revenue Code of <br/>
<a id="pl.70.15"></a><var>70.15</var>1986, as amended through May 18, 2006 February 13, 2008.<br/>
<a id="pl.70.16"></a><var>70.16</var>    (9) "Minnesota adjusted taxable estate" means federal adjusted taxable estate as <br/>
<a id="pl.70.17"></a><var>70.17</var>defined by section 2011(b)(3) of the Internal Revenue Code, increased by the amount of <br/>
<a id="pl.70.18"></a><var>70.18</var>deduction for state death taxes allowed under section 2058 of the Internal Revenue Code.<br/>
<a id="pl.70.19"></a><var>70.19</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.5.0.0"></a>

<a id="bill.5.1.0"></a><a id="pl.70.22"></a><var>70.22</var>    Section 1. Minnesota Statutes 2006, section 297A.668, is amended by adding a <br/>
<a id="pl.70.23"></a><var>70.23</var>subdivision to read:<br/>
<a id="pl.70.24"></a><var>70.24</var>    Subd. 8. <b>Manufactured and modular housing.</b> (a) Notwithstanding other <br/>
<a id="pl.70.25"></a><var>70.25</var>subdivisions of this section, a sale of a manufactured or modular home shall be sourced to <br/>
<a id="pl.70.26"></a><var>70.26</var>the site where the housing is first set up or installed. <br/>
<a id="pl.70.27"></a><var>70.27</var>    (b) For purposes of this section, "manufactured home" has the meaning given <br/>
<a id="pl.70.28"></a><var>70.28</var>in section 327.31, subdivision 6. For purposes of this section, "modular home" means <br/>
<a id="pl.70.29"></a><var>70.29</var>a building or structural unit that has been substantially manufactured or constructed, <br/>
<a id="pl.70.30"></a><var>70.30</var>in whole or in part, at an off-site location, with the final assembly occurring on-site <br/>
<a id="pl.70.31"></a><var>70.31</var>alone or with other units and attached to a permanent foundation site and occupied <br/>
<a id="pl.70.32"></a><var>70.32</var>as a single-family dwelling. Modular home construction must comply with applicable <br/>
<a id="pl.70.33"></a><var>70.33</var>standards adopted in Minnesota Rules authorized under chapter 16B. A modular home <br/>
<a id="pl.71.1"></a><var>71.1</var>does not include a structure subject to the requirements of the National Manufactured <br/>
<a id="pl.71.2"></a><var>71.2</var>Home Construction and Safety Standards Act of 1974 or a manufactured home.<br/>
<a id="pl.71.3"></a><var>71.3</var><b>EFFECTIVE DATE.</b>This section is effective for sales and purchases made after <br/>
<a id="pl.71.4"></a><var>71.4</var>June 30, 2008.<br/>
<br/>
<a id="bill.5.2.0"></a><a id="pl.71.5"></a><var>71.5</var>    Sec. 2. Laws 1980, chapter 511, section 1, subdivision 2, as amended by Laws 1991, <br/>
<a id="pl.71.6"></a><var>71.6</var>chapter 291, article 8, section 22, and Laws 1998, chapter 389, article 8, section 25, and <br/>
<a id="pl.71.7"></a><var>71.7</var>Laws 2003, First Special Session chapter 21, article 8, section 11, is amended to read:<br/>
<a id="pl.71.8"></a><var>71.8</var>    Subd. 2. Notwithstanding Minnesota Statutes, Section 
         <statute_ref>477A.016</statute_ref>, or any other law, <br/>
<a id="pl.71.9"></a><var>71.9</var>ordinance, or city charter provision to the contrary, the city of Duluth may, by ordinance, <br/>
<a id="pl.71.10"></a><var>71.10</var>impose an additional sales tax of up to one and one-half two and one-quarter percent on <br/>
<a id="pl.71.11"></a><var>71.11</var>sales transactions which are described in Minnesota Statutes 2000, Section 
         <statute_ref>297A.01</statute_ref>, <br/>
<a id="pl.71.12"></a><var>71.12</var>Subdivision 3, Clause (c). When the city council determines that the taxes imposed <br/>
<a id="pl.71.13"></a><var>71.13</var>under this subdivision and under Laws 1998, chapter 389, article 8, section 26, at a rate <br/>
<a id="pl.71.14"></a><var>71.14</var>of one-half of one percent have produced revenue sufficient to pay (1) the debt service <br/>
<a id="pl.71.15"></a><var>71.15</var>on bonds in a principal amount of $8,000,000 issued for capital improvements to the <br/>
<a id="pl.71.16"></a><var>71.16</var>Duluth Entertainment and Convention Center, and (2) debt service on outstanding bonds <br/>
<a id="pl.71.17"></a><var>71.17</var>originally issued in the principal amount of $4,970,000 to finance capital improvements <br/>
<a id="pl.71.18"></a><var>71.18</var>to the Great Lakes Aquarium since the imposition of the taxes at the rate of one and <br/>
<a id="pl.71.19"></a><var>71.19</var>one-half percent, the rate of the tax under this subdivision is reduced to by one-half of <br/>
<a id="pl.71.20"></a><var>71.20</var>one percent. The imposition of this tax shall not be subject to voter referendum under <br/>
<a id="pl.71.21"></a><var>71.21</var>either state law or city charter provisions. When the city council determines that the taxes <br/>
<a id="pl.71.22"></a><var>71.22</var>imposed under this subdivision at a rate of three-quarters of one percent and other sources <br/>
<a id="pl.71.23"></a><var>71.23</var>of revenue produce revenue sufficient to pay debt service on bonds in the principal amount <br/>
<a id="pl.71.24"></a><var>71.24</var>of $40,285,000 plus issuance and discount costs, issued for capital improvements at the <br/>
<a id="pl.71.25"></a><var>71.25</var>Duluth Entertainment and Convention Center, which include a new arena, the rate of tax <br/>
<a id="pl.71.26"></a><var>71.26</var>under this subdivision must be reduced by three-quarters of one percent.<br/>
<a id="pl.71.27"></a><var>71.27</var><b>EFFECTIVE DATE.</b>This section is effective the day after the governing body of <br/>
<a id="pl.71.28"></a><var>71.28</var>the city of Duluth and its chief clerical officer comply with Minnesota Statutes, section <br/>
<a id="pl.71.29"></a><var>71.29</var><statute_ref>645.021</statute_ref>, subdivisions 2 and 3.<br/>
<br/>
<a id="bill.5.3.0"></a><a id="pl.71.30"></a><var>71.30</var>    Sec. 3. Laws 2005, First Special Session chapter 3, article 5, section 39, is amended to <br/>
<a id="pl.71.31"></a><var>71.31</var>read:<br/>
<a id="pl.71.32"></a><var>71.32</var>    Sec. 39. <b>CITY OF BEMIDJI.</b><br/>
<a id="pl.72.1"></a><var>72.1</var>    Subdivision 1. <b>Sales and use tax authorized.</b> Notwithstanding Minnesota Statutes, <br/>
<a id="pl.72.2"></a><var>72.2</var>section 
         <statute_ref>477A.016</statute_ref>, or any other provision of law, ordinance, or city charter, pursuant to the <br/>
<a id="pl.72.3"></a><var>72.3</var>approval of the city voters at the general election held on November 5, 2002, and at the <br/>
<a id="pl.72.4"></a><var>72.4</var>general election held November 7, 2006, the city of Bemidji may impose by ordinance <br/>
<a id="pl.72.5"></a><var>72.5</var>a sales and use tax of one-half of one percent for the purposes specified in subdivision <br/>
<a id="pl.72.6"></a><var>72.6</var>2. The provisions of Minnesota Statutes, section 
         <statute_ref>297A.99</statute_ref>, govern the imposition, <br/>
<a id="pl.72.7"></a><var>72.7</var>administration, collection, and enforcement of the tax authorized under this subdivision.<br/>
<a id="pl.72.8"></a><var>72.8</var>    Subd. 2. <b>Use of revenues.</b> Revenues received from the tax authorized by <br/>
<a id="pl.72.9"></a><var>72.9</var>subdivision 1 must be used for the cost of collecting and administering the tax and to pay <br/>
<a id="pl.72.10"></a><var>72.10</var>for the projects listed in this subdivision:<br/>
<a id="pl.72.11"></a><var>72.11</var>    (1) To pay all or part of the capital or administrative costs of the acquisition, <br/>
<a id="pl.72.12"></a><var>72.12</var>construction, and improvement of parks and trails within the city, as provided for in the <br/>
<a id="pl.72.13"></a><var>72.13</var>city of Bemidji's parks, open space, and trail system plan, adopted by the Bemidji City <br/>
<a id="pl.72.14"></a><var>72.14</var>Council on November 21, 2001. Authorized expenses include, but are not limited to, <br/>
<a id="pl.72.15"></a><var>72.15</var>acquiring property, paying construction expenses related to the development of these <br/>
<a id="pl.72.16"></a><var>72.16</var>facilities and improvements, and securing and paying debt service on bonds or other <br/>
<a id="pl.72.17"></a><var>72.17</var>obligations issued to finance acquisition, construction, improvement, or development of <br/>
<a id="pl.72.18"></a><var>72.18</var>parks and trails within the city of Bemidji.<br/>
<a id="pl.72.19"></a><var>72.19</var>    (2) To pay all or part of the city's share of costs, not to exceed $44,000,000, for <br/>
<a id="pl.72.20"></a><var>72.20</var>acquisition, design, and construction of a regional event center, plus any associated <br/>
<a id="pl.72.21"></a><var>72.21</var>bond costs. Authorized expenses include, but are not limited to, acquiring property, <br/>
<a id="pl.72.22"></a><var>72.22</var>paying demolition and construction expenses, improving associated infrastructure, and <br/>
<a id="pl.72.23"></a><var>72.23</var>purchasing furniture, fixtures, and equipment for the regional event center, and securing <br/>
<a id="pl.72.24"></a><var>72.24</var>and paying debt service on bonds or other obligations issued to finance the regional event <br/>
<a id="pl.72.25"></a><var>72.25</var>center project.<br/>
<a id="pl.72.26"></a><var>72.26</var>    Subd. 3. <b>Bonds.</b> (a) Pursuant to the approval of the city voters at the general <br/>
<a id="pl.72.27"></a><var>72.27</var>election held on November 5, 2002, the city of Bemidji may issue, without an additional <br/>
<a id="pl.72.28"></a><var>72.28</var>election, general obligation bonds of the city in an amount not to exceed $9,826,000 to <br/>
<a id="pl.72.29"></a><var>72.29</var>pay capital and administrative expenses for the acquisition, construction, improvement, <br/>
<a id="pl.72.30"></a><var>72.30</var>and development of parks and trails as specified in subdivision 2. The debt represented by <br/>
<a id="pl.72.31"></a><var>72.31</var>the bonds must not be included in computing any debt limitations applicable to the city, <br/>
<a id="pl.72.32"></a><var>72.32</var>and the levy of taxes required by Minnesota Statutes, section 
         <statute_ref>475.61</statute_ref>, to pay the principal <br/>
<a id="pl.72.33"></a><var>72.33</var>of any interest on the bonds must not be subject to any levy limitations or be included in <br/>
<a id="pl.72.34"></a><var>72.34</var>computing or applying any levy limitation applicable to the city.<br/>
<a id="pl.72.35"></a><var>72.35</var>    (b) Pursuant to the approval of the city voters at the general election held on <br/>
<a id="pl.72.36"></a><var>72.36</var>November 7, 2006, the city of Bemidji may issue, without an additional election, general <br/>
<a id="pl.73.1"></a><var>73.1</var>obligation bonds of the city in an amount not to exceed $44,000,000 to pay capital and <br/>
<a id="pl.73.2"></a><var>73.2</var>administrative expenses for the construction of the regional event center specified in <br/>
<a id="pl.73.3"></a><var>73.3</var>subdivision 2. The debt represented by the bonds must not be included in computing <br/>
<a id="pl.73.4"></a><var>73.4</var>any debt limitations applicable to the city, and the levy of taxes required by Minnesota <br/>
<a id="pl.73.5"></a><var>73.5</var>Statutes, section 
<statute_ref>475.61</statute_ref>, to pay the principal of any interest on the bonds must not be <br/>
<a id="pl.73.6"></a><var>73.6</var>subject to any levy limitations or be included in computing or applying any levy limitation <br/>
<a id="pl.73.7"></a><var>73.7</var>applicable to the city.<br/>
<a id="pl.73.8"></a><var>73.8</var>    Subd. 4. <b>Termination of tax.</b> The tax imposed under subdivision 1 expires <br/>
<a id="pl.73.9"></a><var>73.9</var>when the Bemidji City Council determines that the amount described in subdivision 3, <br/>
<a id="pl.73.10"></a><var>73.10</var>paragraph (a), has been received from the tax to finance the capital and administrative <br/>
<a id="pl.73.11"></a><var>73.11</var>costs for acquisition, construction, improvement, and development of parks and trails and <br/>
<a id="pl.73.12"></a><var>73.12</var>to repay or retire at maturity the principal, interest, and premium due on any bonds issued <br/>
<a id="pl.73.13"></a><var>73.13</var>for the park and trail improvements under subdivision 3, paragraph (a), plus the earlier of <br/>
<a id="pl.73.14"></a><var>73.14</var>(1) 30 years after the tax extension to pay for the project in subdivision 2, clause (2), is <br/>
<a id="pl.73.15"></a><var>73.15</var>first imposed, or (2) when the city council first determines that the additional revenues <br/>
<a id="pl.73.16"></a><var>73.16</var>received from the extension of the tax equals or exceeds the amount authorized to be spent <br/>
<a id="pl.73.17"></a><var>73.17</var>for the regional event center under subdivision 2, clause (2). Any funds remaining after <br/>
<a id="pl.73.18"></a><var>73.18</var>completion of the park and trail improvements authorized projects and retirement or <br/>
<a id="pl.73.19"></a><var>73.19</var>redemption of the bonds may be placed in the general fund of the city. The tax imposed <br/>
<a id="pl.73.20"></a><var>73.20</var>under subdivision 1 may expire at an earlier time if the city so determines by ordinance.<br/>
<a id="pl.73.21"></a><var>73.21</var><b>EFFECTIVE DATE.</b>This section is effective the day after compliance by the <br/>
<a id="pl.73.22"></a><var>73.22</var>governing body of the city of Bemidji and its chief clerical officer with Minnesota <br/>
<a id="pl.73.23"></a><var>73.23</var>Statutes, section 645.021, subdivisions 2 and 3.<br/>
<br/>
<a id="bill.6.0.0"></a>

<a id="bill.6.1.0"></a><a id="pl.73.26"></a><var>73.26</var>    Section 1. Minnesota Statutes 2006, section 289A.20, subdivision 4, is amended to <br/>
<a id="pl.73.27"></a><var>73.27</var>read:<br/>
<a id="pl.73.28"></a><var>73.28</var>    Subd. 4. <b>Sales and use tax.</b> (a) The taxes imposed by chapter 297A are due and <br/>
<a id="pl.73.29"></a><var>73.29</var>payable to the commissioner monthly on or before the 20th day of the month following the <br/>
<a id="pl.73.30"></a><var>73.30</var>month in which the taxable event occurred, or following another reporting period as the <br/>
<a id="pl.73.31"></a><var>73.31</var>commissioner prescribes or as allowed under section 
         <statute_ref>289A.18, subdivision 4</statute_ref>, paragraph <br/>
<a id="pl.73.32"></a><var>73.32</var>(f) or (g), except that use taxes due on an annual use tax return as provided under section <br/>
<statute_ref><a id="pl.73.33"></a><var>73.33</var>289A.11, subdivision 1
         </statute_ref>, are payable by April 15 following the close of the calendar year.<br/>
<a id="pl.74.1"></a><var>74.1</var>(b) A vendor having a liability of $120,000 or more during a fiscal year ending June <br/>
<a id="pl.74.2"></a><var>74.2</var>30 must remit the June liability for the next year in the following manner:<br/>
<a id="pl.74.3"></a><var>74.3</var>(1) Two business days before June 30 of the year, the vendor must remit 78 80 <br/>
<a id="pl.74.4"></a><var>74.4</var>percent of the estimated June liability to the commissioner.<br/>
<a id="pl.74.5"></a><var>74.5</var>(2) On or before August 20 of the year, the vendor must pay any additional amount <br/>
<a id="pl.74.6"></a><var>74.6</var>of tax not remitted in June.<br/>
<a id="pl.74.7"></a><var>74.7</var>(c) A vendor having a liability of:<br/>
<a id="pl.74.8"></a><var>74.8</var>(1) $20,000 or more in the fiscal year ending June 30, 2005; or<br/>
<a id="pl.74.9"></a><var>74.9</var>(2) $10,000 or more in the fiscal year ending June 30, 2006, and fiscal years <br/>
<a id="pl.74.10"></a><var>74.10</var>thereafter,<br/>
<a id="pl.74.11"></a><var>74.11</var>must remit all liabilities on returns due for periods beginning in the subsequent calendar <br/>
<a id="pl.74.12"></a><var>74.12</var>year by electronic means on or before the 20th day of the month following the month in <br/>
<a id="pl.74.13"></a><var>74.13</var>which the taxable event occurred, or on or before the 20th day of the month following the <br/>
<a id="pl.74.14"></a><var>74.14</var>month in which the sale is reported under section 
         <statute_ref>289A.18, subdivision 4</statute_ref>, except for 78 80 <br/>
<a id="pl.74.15"></a><var>74.15</var>percent of the estimated June liability, which is due two business days before June 30. The <br/>
<a id="pl.74.16"></a><var>74.16</var>remaining amount of the June liability is due on August 20.<br/>
<a id="pl.74.17"></a><var>74.17</var><b>EFFECTIVE DATE.</b>This section is effective beginning with June 2009 tax <br/>
<a id="pl.74.18"></a><var>74.18</var>liabilities.<br/>
<br/>
<a id="bill.6.2.0"></a><a id="pl.74.19"></a><var>74.19</var>    Sec. 2. Minnesota Statutes 2006, section 289A.60, subdivision 15, is amended to read:<br/>
<a id="pl.74.20"></a><var>74.20</var>    Subd. 15. <b>Accelerated payment of June sales tax liability; penalty for </b><br/>
<a id="pl.74.21"></a><var>74.21</var><b>underpayment.</b> For payments made after December 31, 2006, if a vendor is required by <br/>
<a id="pl.74.22"></a><var>74.22</var>law to submit an estimation of June sales tax liabilities and 78 80 percent payment by a <br/>
<a id="pl.74.23"></a><var>74.23</var>certain date, the vendor shall pay a penalty equal to ten percent of the amount of actual <br/>
<a id="pl.74.24"></a><var>74.24</var>June liability required to be paid in June less the amount remitted in June. The penalty <br/>
<a id="pl.74.25"></a><var>74.25</var>must not be imposed, however, if the amount remitted in June equals the lesser of 78 80 <br/>
<a id="pl.74.26"></a><var>74.26</var>percent of the preceding May's liability or 78 80 percent of the average monthly liability <br/>
<a id="pl.74.27"></a><var>74.27</var>for the previous calendar year.<br/>
<a id="pl.74.28"></a><var>74.28</var><b>EFFECTIVE DATE.</b>This section is effective beginning with June 2009 tax <br/>
<a id="pl.74.29"></a><var>74.29</var>liabilities.<br/>
<br/>
<a id="bill.6.3.0"></a><a id="pl.74.30"></a><var>74.30</var>    Sec. 3. Minnesota Statutes 2006, section 297F.09, subdivision 10, is amended to read:<br/>
<a id="pl.74.31"></a><var>74.31</var>    Subd. 10. <b>Accelerated tax payment; cigarette or tobacco products distributor.</b><br/>
<a id="pl.74.32"></a><var>74.32</var>A cigarette or tobacco products distributor having a liability of $120,000 or more during a <br/>
<a id="pl.75.1"></a><var>75.1</var>fiscal year ending June 30, shall remit the June liability for the next year in the following <br/>
<a id="pl.75.2"></a><var>75.2</var>manner:<br/>
<a id="pl.75.3"></a><var>75.3</var>(a) Two business days before June 30 of the year, the distributor shall remit the <br/>
<a id="pl.75.4"></a><var>75.4</var>actual May liability and 78 80 percent of the estimated June liability to the commissioner <br/>
<a id="pl.75.5"></a><var>75.5</var>and file the return in the form and manner prescribed by the commissioner.<br/>
<a id="pl.75.6"></a><var>75.6</var>(b) On or before August 18 of the year, the distributor shall submit a return showing <br/>
<a id="pl.75.7"></a><var>75.7</var>the actual June liability and pay any additional amount of tax not remitted in June. A <br/>
<a id="pl.75.8"></a><var>75.8</var>penalty is imposed equal to ten percent of the amount of June liability required to be paid <br/>
<a id="pl.75.9"></a><var>75.9</var>in June, less the amount remitted in June. However, the penalty is not imposed if the <br/>
<a id="pl.75.10"></a><var>75.10</var>amount remitted in June equals the lesser of:<br/>
<a id="pl.75.11"></a><var>75.11</var>(1) 78 80 percent of the actual June liability; or<br/>
<a id="pl.75.12"></a><var>75.12</var>(2) 78 80 percent of the preceding May's liability.<br/>
<a id="pl.75.13"></a><var>75.13</var><b>EFFECTIVE DATE.</b>This section is effective beginning with June 2009 tax <br/>
<a id="pl.75.14"></a><var>75.14</var>liabilities.<br/>
<br/>
<a id="bill.6.4.0"></a><a id="pl.75.15"></a><var>75.15</var>    Sec. 4. Minnesota Statutes 2006, section 297G.09, subdivision 9, is amended to read:<br/>
<a id="pl.75.16"></a><var>75.16</var>    Subd. 9. <b>Accelerated tax payment; penalty.</b> A person liable for tax under this <br/>
<a id="pl.75.17"></a><var>75.17</var>chapter having a liability of $120,000 or more during a fiscal year ending June 30, shall <br/>
<a id="pl.75.18"></a><var>75.18</var>remit the June liability for the next year in the following manner:<br/>
<a id="pl.75.19"></a><var>75.19</var>(a) Two business days before June 30 of the year, the taxpayer shall remit the actual <br/>
<a id="pl.75.20"></a><var>75.20</var>May liability and 78 80 percent of the estimated June liability to the commissioner and file <br/>
<a id="pl.75.21"></a><var>75.21</var>the return in the form and manner prescribed by the commissioner.<br/>
<a id="pl.75.22"></a><var>75.22</var>(b) On or before August 18 of the year, the taxpayer shall submit a return showing <br/>
<a id="pl.75.23"></a><var>75.23</var>the actual June liability and pay any additional amount of tax not remitted in June. A <br/>
<a id="pl.75.24"></a><var>75.24</var>penalty is imposed equal to ten percent of the amount of June liability required to be paid <br/>
<a id="pl.75.25"></a><var>75.25</var>in June less the amount remitted in June. However, the penalty is not imposed if the <br/>
<a id="pl.75.26"></a><var>75.26</var>amount remitted in June equals the lesser of:<br/>
<a id="pl.75.27"></a><var>75.27</var>(1) 78 80 percent of the actual June liability; or<br/>
<a id="pl.75.28"></a><var>75.28</var>(2) 78 80 percent of the preceding May liability.<br/>
<a id="pl.75.29"></a><var>75.29</var><b>EFFECTIVE DATE.</b>This section is effective beginning with June 2009 tax <br/>
<a id="pl.75.30"></a><var>75.30</var>liabilities.<br/>
<br/>
<a id="bill.7.0.0"></a>

<a id="bill.7.1.0"></a><a id="pl.75.33"></a><var>75.33</var>    Section 1. Minnesota Statutes 2006, section 291.215, subdivision 1, is amended to read:<br/>
<a id="pl.76.1"></a><var>76.1</var>    Subdivision 1. <b>Determination.</b> All property includable in the Minnesota gross estate <br/>
<a id="pl.76.2"></a><var>76.2</var>of a decedent shall be valued in accordance with the provisions of sections 2031 or 2032 <br/>
<a id="pl.76.3"></a><var>76.3</var>and, if applicable, 2032A, of the Internal Revenue Code and any elections made in valuing <br/>
<a id="pl.76.4"></a><var>76.4</var>the federal gross estate shall be applicable in valuing the Minnesota gross estate. Values <br/>
<a id="pl.76.5"></a><var>76.5</var>for purposes of the estate tax on both probate and nonprobate assets shall be the same as <br/>
<a id="pl.76.6"></a><var>76.6</var>those finally determined for purposes of the federal estate tax on a decedent's estate. <br/>
<a id="pl.76.7"></a><var>76.7</var>The value of all property includable in the Minnesota gross estate of a decedent may be <br/>
<a id="pl.76.8"></a><var>76.8</var>independently determined under those sections for Minnesota estate tax purposes except:<br/>
<a id="pl.76.9"></a><var>76.9</var>(1) as otherwise provided in section 291.075; or<br/>
<a id="pl.76.10"></a><var>76.10</var>(2) if the Internal Revenue Service, after receiving the estate's federal estate tax <br/>
<a id="pl.76.11"></a><var>76.11</var>return, either conducts a separate appraisal of an asset reported on the return or proposes <br/>
<a id="pl.76.12"></a><var>76.12</var>a change in the reported valuation of an asset in the estate, in which case the federal <br/>
<a id="pl.76.13"></a><var>76.13</var>final determination of the value controls.<br/>
<a id="pl.76.14"></a><var>76.14</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for estates of decedents <br/>
<a id="pl.76.15"></a><var>76.15</var>dying after December 31, 2006.<br/>
<br/>
<a id="bill.7.2.0"></a><a id="pl.76.16"></a><var>76.16</var>    Sec. 2. Minnesota Statutes 2006, section 296A.18, subdivision 4, is amended to read:<br/>
<a id="pl.76.17"></a><var>76.17</var>    Subd. 4. <b>All-terrain vehicle.</b> Approximately 0.15 0.27 of one percent of all gasoline <br/>
<a id="pl.76.18"></a><var>76.18</var>received in or produced or brought into this state, except gasoline used for aviation <br/>
<a id="pl.76.19"></a><var>76.19</var>purposes, is being used for the operation of all-terrain vehicles in this state, and of the total <br/>
<a id="pl.76.20"></a><var>76.20</var>revenue derived from the imposition of the gasoline fuel tax, 0.15 0.27 of one percent is <br/>
<a id="pl.76.21"></a><var>76.21</var>the amount of tax on fuel used in all-terrain vehicles operated in this state.<br/>
<a id="pl.76.22"></a><var>76.22</var><b>EFFECTIVE DATE.</b>This section is effective for revenue received after June <br/>
<a id="pl.76.23"></a><var>76.23</var>30, 2008.<br/>
<br/>
<a id="bill.7.3.0"></a><a id="pl.76.24"></a><var>76.24</var>    Sec. 3. Minnesota Statutes 2006, section 297F.21, subdivision 3, is amended to read:<br/>
<a id="pl.76.25"></a><var>76.25</var>    Subd. 3. <b>Inventory; judicial determination; appeal; disposition of seized </b><br/>
<a id="pl.76.26"></a><var>76.26</var><b>property.</b> (a) Within ten days after the seizure of any alleged contraband, the person <br/>
<a id="pl.76.27"></a><var>76.27</var>making the seizure shall serve by certified mail an inventory of the property seized on the <br/>
<a id="pl.76.28"></a><var>76.28</var>person from whom the seizure was made, if known, and on any person known or believed <br/>
<a id="pl.76.29"></a><var>76.29</var>to have any right, title, interest, or lien in the property, at the last known address, and file <br/>
<a id="pl.76.30"></a><var>76.30</var>a copy with the commissioner. The notice must include an explanation of the right to <br/>
<a id="pl.76.31"></a><var>76.31</var>demand a judicial forfeiture determination.<br/>
<a id="pl.76.32"></a><var>76.32</var>    (b) Within 60 days after the date of service of the inventory, which is the date of <br/>
<a id="pl.76.33"></a><var>76.33</var>mailing, the person from whom the property was seized or any person claiming an interest <br/>
<a id="pl.77.1"></a><var>77.1</var>in the property may file a demand for a judicial determination of the question as to whether <br/>
<a id="pl.77.2"></a><var>77.2</var>the property was lawfully subject to seizure and forfeiture. The demand must be in the <br/>
<a id="pl.77.3"></a><var>77.3</var>form of a civil complaint and must be filed with the court administrator in the county in <br/>
<a id="pl.77.4"></a><var>77.4</var>which the seizure occurred, together with proof of service of a copy of the complaint <br/>
<a id="pl.77.5"></a><var>77.5</var>on the commissioner of revenue, and the standard filing fee for civil actions unless the <br/>
<a id="pl.77.6"></a><var>77.6</var>petitioner has the right to sue in forma pauperis under section 
         <statute_ref>563.01</statute_ref>. If the value of the <br/>
<a id="pl.77.7"></a><var>77.7</var>seized property is $7,500 or less, the claimant may file an action in conciliation court for <br/>
<a id="pl.77.8"></a><var>77.8</var>recovery of the property. If the value of the seized property is less than $500, the claimant <br/>
<a id="pl.77.9"></a><var>77.9</var>does not have to pay the conciliation court filing fee. <br/>
<a id="pl.77.10"></a><var>77.10</var>    (c) The complaint must be captioned in the name of the claimant as plaintiff and <br/>
<a id="pl.77.11"></a><var>77.11</var>the seized property as defendant, and must state with specificity the grounds on which <br/>
<a id="pl.77.12"></a><var>77.12</var>the claimant alleges the property was improperly seized and the plaintiff's interest in the <br/>
<a id="pl.77.13"></a><var>77.13</var>property seized. No responsive pleading is required of the commissioner, and no court <br/>
<a id="pl.77.14"></a><var>77.14</var>fees may be charged for the commissioner's appearance in the matter. The proceedings <br/>
<a id="pl.77.15"></a><var>77.15</var>are governed by the Rules of Civil Procedure. Notwithstanding any law to the contrary, <br/>
<a id="pl.77.16"></a><var>77.16</var>an action for the return of property seized under this section may not be maintained by <br/>
<a id="pl.77.17"></a><var>77.17</var>or on behalf of any person who has been served with an inventory unless the person has <br/>
<a id="pl.77.18"></a><var>77.18</var>complied with this subdivision. The court shall decide whether the alleged contraband is <br/>
<a id="pl.77.19"></a><var>77.19</var>contraband, as defined in subdivision 1. The court shall hear the action without a jury and <br/>
<a id="pl.77.20"></a><var>77.20</var>shall try and determine the issues of fact and law involved.<br/>
<a id="pl.77.21"></a><var>77.21</var>    (d) When a judgment of forfeiture is entered, the commissioner may, unless the <br/>
<a id="pl.77.22"></a><var>77.22</var>judgment is stayed pending an appeal, either the commissioner:<br/>
<a id="pl.77.23"></a><var>77.23</var>    (1) deliver the forfeited cigarette packages or tobacco products to the commissioner <br/>
<a id="pl.77.24"></a><var>77.24</var>of human services for use by patients in state institutions may authorize the forfeited <br/>
<a id="pl.77.25"></a><var>77.25</var>property to be used for the purpose of enforcing a criminal provision of state or federal law;<br/>
<a id="pl.77.26"></a><var>77.26</var>    (2) shall cause the property in clause (1) forfeited cigarette packages or tobacco <br/>
<a id="pl.77.27"></a><var>77.27</var>products not used under clause (1) to be destroyed; or and products used under clause (1) <br/>
<a id="pl.77.28"></a><var>77.28</var>to be destroyed upon the completion of use; and<br/>
<a id="pl.77.29"></a><var>77.29</var>    (3) may cause the forfeited property, other than forfeited cigarette packages or <br/>
<a id="pl.77.30"></a><var>77.30</var>tobacco products, to be sold at public auction as provided by law.<br/>
<a id="pl.77.31"></a><var>77.31</var>The person making a sale, after deducting the expense of keeping the property, the fee <br/>
<a id="pl.77.32"></a><var>77.32</var>for seizure, and the costs of the sale, shall pay all liens according to their priority, which <br/>
<a id="pl.77.33"></a><var>77.33</var>are established as being bona fide and as existing without the lienor having any notice <br/>
<a id="pl.77.34"></a><var>77.34</var>or knowledge that the property was being used or was intended to be used for or in <br/>
<a id="pl.77.35"></a><var>77.35</var>connection with the violation. The balance of the proceeds must be paid 75 percent to the <br/>
<a id="pl.77.36"></a><var>77.36</var>Department of Revenue for deposit as a supplement to its operating fund or similar fund <br/>
<a id="pl.78.1"></a><var>78.1</var>for official use, and 25 percent to the county attorney or other prosecuting agency that <br/>
<a id="pl.78.2"></a><var>78.2</var>handled the court proceeding, if there is one, for deposit as a supplement to its operating <br/>
<a id="pl.78.3"></a><var>78.3</var>fund or similar fund for prosecutorial purposes. If there is no prosecuting authority <br/>
<a id="pl.78.4"></a><var>78.4</var>involved in the forfeiture, the 25 percent of the proceeds otherwise designated for the <br/>
<a id="pl.78.5"></a><var>78.5</var>prosecuting authority must be deposited into the general fund.<br/>
<a id="pl.78.6"></a><var>78.6</var>    (e) If no demand for judicial determination is made, the property seized is considered <br/>
<a id="pl.78.7"></a><var>78.7</var>forfeited to the state by operation of law and may be disposed of by the commissioner as <br/>
<a id="pl.78.8"></a><var>78.8</var>provided in the case of a judgment of forfeiture.<br/>
<a id="pl.78.9"></a><var>78.9</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.7.4.0"></a><a id="pl.78.10"></a><var>78.10</var>    Sec. 4. Minnesota Statutes 2006, section 297I.15, is amended by adding a subdivision <br/>
<a id="pl.78.11"></a><var>78.11</var>to read:<br/>
<a id="pl.78.12"></a><var>78.12</var>    Subd. 11. <b>Premiums paid to certain foreign insurance companies.</b> With respect <br/>
<a id="pl.78.13"></a><var>78.13</var>to the state employees group insurance program established under sections 43A.23 to <br/>
<a id="pl.78.14"></a><var>78.14</var>43A.31, premiums paid for life insurance and accidental death and dismemberment <br/>
<a id="pl.78.15"></a><var>78.15</var>insurance for eligible employees and dependents, including premiums paid by employees <br/>
<a id="pl.78.16"></a><var>78.16</var>or dependents for optional coverage, are exempt from the taxes imposed under this chapter <br/>
<a id="pl.78.17"></a><var>78.17</var>to the extent the premiums are paid to a foreign insurance company domiciled in a state <br/>
<a id="pl.78.18"></a><var>78.18</var>that exempts its state employee group life insurance program from premium taxes.<br/>
<a id="pl.78.19"></a><var>78.19</var><b>EFFECTIVE DATE.</b>This section is effective for premiums paid after December <br/>
<a id="pl.78.20"></a><var>78.20</var>31, 2007.<br/>
<br/>
<a id="bill.7.5.0"></a><a id="pl.78.21"></a><var>78.21</var>    Sec. 5. Laws 2003, chapter 128, article 1, section 172, as amended by Laws 2005, First <br/>
<a id="pl.78.22"></a><var>78.22</var>Special Session chapter 1, article 4, section 118, is amended to read:<br/>
<a id="pl.78.23"></a><var>78.23</var>    Sec. 172. <b>TEMPORARY PETROFUND FEE EXEMPTION FOR </b><br/>
<a id="pl.78.24"></a><var>78.24</var><b>MINNESOTA COMMERCIAL AIRLINES.</b><br/>
<a id="pl.78.25"></a><var>78.25</var>    (a) A commercial airline providing regularly scheduled jet service and with its <br/>
<a id="pl.78.26"></a><var>78.26</var>corporate headquarters in Minnesota is exempt from the fee established in Minnesota <br/>
<a id="pl.78.27"></a><var>78.27</var>Statutes, section 
         <statute_ref>115C.08, subdivision 3</statute_ref>, until July 1, 2007 2009, provided the airline <br/>
<a id="pl.78.28"></a><var>78.28</var>develops a plan approved by the commissioner of commerce demonstrating that the <br/>
<a id="pl.78.29"></a><var>78.29</var>savings from this exemption will go towards minimizing job losses in Minnesota, and to <br/>
<a id="pl.78.30"></a><var>78.30</var>support the airline's efforts to avoid filing for resolve federal bankruptcy protections <br/>
<a id="pl.78.31"></a><var>78.31</var>proceedings.<br/>
<a id="pl.78.32"></a><var>78.32</var>    (b) A commercial airline exempted from the fee is ineligible to receive <br/>
<a id="pl.78.33"></a><var>78.33</var>reimbursement under Minnesota Statutes, chapter 115C, until July 1, 2007 2009. A <br/>
<a id="pl.79.1"></a><var>79.1</var>commercial airline that has a release during the fee exemption period is ineligible to <br/>
<a id="pl.79.2"></a><var>79.2</var>receive reimbursement under Minnesota Statutes, chapter 115C, for the costs incurred in <br/>
<a id="pl.79.3"></a><var>79.3</var>response to that release.<br/>
<a id="pl.79.4"></a><var>79.4</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.8.0.0"></a>

<a id="bill.8.1.0"></a><a id="pl.79.7"></a><var>79.7</var>    Section 1. Minnesota Statutes 2006, section 276A.01, subdivision 3, is amended to <br/>
<a id="pl.79.8"></a><var>79.8</var>read:<br/>
<a id="pl.79.9"></a><var>79.9</var>    Subd. 3. <b>Commercial-industrial property.</b> "Commercial-industrial property" <br/>
<a id="pl.79.10"></a><var>79.10</var>means the following categories of property, as defined in section 
         <statute_ref>273.13</statute_ref>, excluding that <br/>
<a id="pl.79.11"></a><var>79.11</var>portion of the property (i) that may, by law, constitute the tax base for a tax increment <br/>
<a id="pl.79.12"></a><var>79.12</var>pledged pursuant to section 
         <statute_ref>469.042</statute_ref> or 
         <statute_ref>469.162</statute_ref> or sections 
         <statute_ref>469.174</statute_ref> to 
         <statute_ref>469.178</statute_ref>, <br/>
<a id="pl.79.13"></a><var>79.13</var>certification of which was requested prior to May 1, 1996, to the extent and while the tax <br/>
<a id="pl.79.14"></a><var>79.14</var>increment is so pledged; or (ii) that is exempt from taxation under section 
         <statute_ref>272.02</statute_ref>: <br/>
<a id="pl.79.15"></a><var>79.15</var>    (1) that portion of class 5 property consisting of unmined iron ore and low-grade <br/>
<a id="pl.79.16"></a><var>79.16</var>iron-bearing formations as defined in section 
         <statute_ref>273.14</statute_ref>, tools, implements, and machinery, <br/>
<a id="pl.79.17"></a><var>79.17</var>except the portion of high voltage transmission lines, the value of which is deducted from <br/>
<a id="pl.79.18"></a><var>79.18</var>net tax capacity under section 
         <statute_ref>273.425</statute_ref>; and <br/>
<a id="pl.79.19"></a><var>79.19</var>    (2) that portion of class 3 and class 5 property which is either used or zoned for <br/>
<a id="pl.79.20"></a><var>79.20</var>use for any commercial or industrial purpose, including property that becomes taxable <br/>
<a id="pl.79.21"></a><var>79.21</var>under section 298.25, except for such property which is, or, in the case of property under <br/>
<a id="pl.79.22"></a><var>79.22</var>construction, will when completed be used exclusively for residential occupancy and <br/>
<a id="pl.79.23"></a><var>79.23</var>the provision of services to residential occupants thereof. Property must be considered <br/>
<a id="pl.79.24"></a><var>79.24</var>as used exclusively for residential occupancy only if each of not less than 80 percent <br/>
<a id="pl.79.25"></a><var>79.25</var>of its occupied residential units is, or, in the case of property under construction, will <br/>
<a id="pl.79.26"></a><var>79.26</var>when completed be occupied under an oral or written agreement for occupancy over a <br/>
<a id="pl.79.27"></a><var>79.27</var>continuous period of not less than 30 days.<br/>
<a id="pl.79.28"></a><var>79.28</var>    If the classification of property prescribed by section 
         <statute_ref>273.13</statute_ref> is modified by <br/>
<a id="pl.79.29"></a><var>79.29</var>legislative amendment, the references in this subdivision are to the successor class or <br/>
<a id="pl.79.30"></a><var>79.30</var>classes of property, or portions thereof, that include the kinds of property designated <br/>
<a id="pl.79.31"></a><var>79.31</var>in this subdivision. <br/>
<a id="pl.79.32"></a><var>79.32</var><b>EFFECTIVE DATE.</b>This section is effective for the 2008 assessment and <br/>
<a id="pl.79.33"></a><var>79.33</var>thereafter.<br/>
<br/>
<a id="bill.8.2.0"></a><a id="pl.80.1"></a><var>80.1</var>    Sec. 2. Minnesota Statutes 2006, section 276A.04, is amended to read:<br/>
<a id="pl.80.2"></a><var>80.2</var><b>276A.04 INCREASE IN NET TAX CAPACITY.</b><br/>
<a id="pl.80.3"></a><var>80.3</var>    By July 15 of 1997 and each subsequent year, the auditor of each county in the <br/>
<a id="pl.80.4"></a><var>80.4</var>area shall determine the amount, if any, by which the net tax capacity determined in <br/>
<a id="pl.80.5"></a><var>80.5</var>the preceding year pursuant to section 
         <statute_ref>276A.03</statute_ref>, of commercial-industrial property <br/>
<a id="pl.80.6"></a><var>80.6</var>subject to taxation within each municipality in the county exceeds the net tax capacity <br/>
<a id="pl.80.7"></a><var>80.7</var>in 1995 of commercial-industrial property subject to taxation within that municipality, <br/>
<a id="pl.80.8"></a><var>80.8</var>including the total net tax capacity of property that becomes taxable under section 298.25. <br/>
<a id="pl.80.9"></a><var>80.9</var>If a municipality is located in two or more counties within the area, the auditors of <br/>
<a id="pl.80.10"></a><var>80.10</var>those counties shall certify the data required by section 
         <statute_ref>276A.03</statute_ref> to the county auditor <br/>
<a id="pl.80.11"></a><var>80.11</var>responsible for allocating the levies of that municipality between or among the affected <br/>
<a id="pl.80.12"></a><var>80.12</var>counties. That county auditor shall determine the amount of the net excess, if any, for the <br/>
<a id="pl.80.13"></a><var>80.13</var>municipality under this section, and certify that amount under section 
         <statute_ref>276A.05</statute_ref>. The <br/>
<a id="pl.80.14"></a><var>80.14</var>increase in total net tax capacity determined by this section must be reduced by the amount <br/>
<a id="pl.80.15"></a><var>80.15</var>of any decreases in the net tax capacity of commercial-industrial property resulting from <br/>
<a id="pl.80.16"></a><var>80.16</var>any court decisions, court-related stipulation agreements, or abatements for a prior year, <br/>
<a id="pl.80.17"></a><var>80.17</var>and only in the amount of such decreases made during the 12-month period ending on <br/>
<a id="pl.80.18"></a><var>80.18</var>May 1 of the current assessment year, where the decreases, if originally reflected in the <br/>
<a id="pl.80.19"></a><var>80.19</var>determination of a prior year's net tax capacity under section 
         <statute_ref>276A.03</statute_ref>, would have <br/>
<a id="pl.80.20"></a><var>80.20</var>resulted in a smaller contribution from the municipality in that year. An adjustment for the <br/>
<a id="pl.80.21"></a><var>80.21</var>decreases shall be made only if the municipality made a contribution in a prior year based <br/>
<a id="pl.80.22"></a><var>80.22</var>on the higher net tax capacity of the commercial-industrial property. <br/>
<a id="pl.80.23"></a><var>80.23</var><b>EFFECTIVE DATE.</b>This section is effective for the 2008 assessment and <br/>
<a id="pl.80.24"></a><var>80.24</var>thereafter.<br/>
<br/>
<a id="bill.8.3.0"></a><a id="pl.80.25"></a><var>80.25</var>    Sec. 3. Minnesota Statutes 2006, section 298.22, is amended by adding a subdivision <br/>
<a id="pl.80.26"></a><var>80.26</var>to read:<br/>
<a id="pl.80.27"></a><var>80.27</var>    Subd. 5a. <b>Forest trust.</b> The commissioner, upon the affirmative vote of a majority <br/>
<a id="pl.80.28"></a><var>80.28</var>of the members of the board, may purchase forest lands in the taconite assistance area <br/>
<a id="pl.80.29"></a><var>80.29</var>defined in under section 273.1341 with funds specifically authorized for the purchase. The <br/>
<a id="pl.80.30"></a><var>80.30</var>acquired forest lands must be held in trust for the benefit of the citizens of the taconite <br/>
<a id="pl.80.31"></a><var>80.31</var>assistance area as the Iron Range Miners' Memorial Forest. The forest trust lands shall be <br/>
<a id="pl.80.32"></a><var>80.32</var>managed and developed for recreation and economic development purposes. Proceeds <br/>
<a id="pl.80.33"></a><var>80.33</var>derived from the management of the lands and from the sale of timber or removal of <br/>
<a id="pl.80.34"></a><var>80.34</var>gravel or other minerals from these forest lands shall be deposited into an Iron Range <br/>
<a id="pl.81.1"></a><var>81.1</var>Miners' Memorial Forest account that is established within the state financial accounts. <br/>
<a id="pl.81.2"></a><var>81.2</var>Funds may be expended from the account upon approval of a majority of the members of <br/>
<a id="pl.81.3"></a><var>81.3</var>the board to purchase, manage, administer, convey interests in, and improve the forest <br/>
<a id="pl.81.4"></a><var>81.4</var>lands. By majority vote of the members of the board, money in the Iron Range Miners' <br/>
<a id="pl.81.5"></a><var>81.5</var>Memorial Forest account may be transferred into the corpus of the Douglas J. Johnson <br/>
<a id="pl.81.6"></a><var>81.6</var>economic protection trust fund established under sections 298.291 to 298.294. The <br/>
<a id="pl.81.7"></a><var>81.7</var>property acquired under the authority granted by this subdivision and income derived from <br/>
<a id="pl.81.8"></a><var>81.8</var>the property or the operation or management of the property are exempt from taxation <br/>
<a id="pl.81.9"></a><var>81.9</var>by the state or its political subdivisions.<br/>
<a id="pl.81.10"></a><var>81.10</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.8.4.0"></a><a id="pl.81.11"></a><var>81.11</var>    Sec. 4. Minnesota Statutes 2006, section 298.2214, subdivision 2, is amended to read:<br/>
<a id="pl.81.12"></a><var>81.12</var>    Subd. 2. <b>Iron Range Higher Education Committee; </b><b>membership.</b> The members <br/>
<a id="pl.81.13"></a><var>81.13</var>of the committee shall consist of:<br/>
<a id="pl.81.14"></a><var>81.14</var>    (1) one member appointed by the governor;<br/>
<a id="pl.81.15"></a><var>81.15</var>    (2) one member appointed by the president of the University of Minnesota;<br/>
<a id="pl.81.16"></a><var>81.16</var>    (3) two four members appointed by the commissioner of the Iron Range Resources <br/>
<a id="pl.81.17"></a><var>81.17</var>and Rehabilitation Board appointed by the chair; and<br/>
<a id="pl.81.18"></a><var>81.18</var>    (4) the commissioner of Iron Range resources and rehabilitation; and<br/>
<a id="pl.81.19"></a><var>81.19</var>    (5) the president of the Northeast Higher Education District or its successor.<br/>
<br/>
<a id="bill.8.5.0"></a><a id="pl.81.20"></a><var>81.20</var>    Sec. 5. Minnesota Statutes 2006, section 298.24, subdivision 1, is amended to read:<br/>
<a id="pl.81.21"></a><var>81.21</var>    Subdivision 1. <b>Imposed; calculation.</b> (a) For concentrate produced in 2001, 2002, <br/>
<a id="pl.81.22"></a><var>81.22</var>and 2003, there is imposed upon taconite and iron sulphides, and upon the mining and <br/>
<a id="pl.81.23"></a><var>81.23</var>quarrying thereof, and upon the production of iron ore concentrate therefrom, and upon <br/>
<a id="pl.81.24"></a><var>81.24</var>the concentrate so produced, a tax of $2.103 per gross ton of merchantable iron ore <br/>
<a id="pl.81.25"></a><var>81.25</var>concentrate produced therefrom. For concentrates produced in 2005, the tax rate is the <br/>
<a id="pl.81.26"></a><var>81.26</var>same rate imposed for concentrates produced in 2004.<br/>
<a id="pl.81.27"></a><var>81.27</var>    (b) For concentrates produced in 2006 and subsequent years, the tax rate shall be <br/>
<a id="pl.81.28"></a><var>81.28</var>equal to the preceding year's tax rate plus an amount equal to the preceding year's tax rate <br/>
<a id="pl.81.29"></a><var>81.29</var>multiplied by the percentage increase in the implicit price deflator from the fourth quarter <br/>
<a id="pl.81.30"></a><var>81.30</var>of the second preceding year to the fourth quarter of the preceding year. "Implicit price <br/>
<a id="pl.81.31"></a><var>81.31</var>deflator" means the implicit price deflator for the gross domestic product prepared by the <br/>
<a id="pl.81.32"></a><var>81.32</var>Bureau of Economic Analysis of the United States Department of Commerce.<br/>
<a id="pl.81.33"></a><var>81.33</var>    (c) On concentrates produced in 1997 and thereafter, an additional tax is imposed <br/>
<a id="pl.81.34"></a><var>81.34</var>equal to three cents per gross ton of merchantable iron ore concentrate for each one <br/>
<a id="pl.82.1"></a><var>82.1</var>percent that the iron content of the product exceeds 72 percent, when dried at 212 degrees <br/>
<a id="pl.82.2"></a><var>82.2</var>Fahrenheit.<br/>
<a id="pl.82.3"></a><var>82.3</var>    (d) The tax shall be imposed on the average of the production for the current year <br/>
<a id="pl.82.4"></a><var>82.4</var>and the previous two years. The rate of the tax imposed will be the current year's tax rate. <br/>
<a id="pl.82.5"></a><var>82.5</var>This clause shall not apply in the case of the closing of a taconite facility if the property <br/>
<a id="pl.82.6"></a><var>82.6</var>taxes on the facility would be higher if this clause and section 
         <statute_ref>298.25</statute_ref> were not applicable.<br/>
<a id="pl.82.7"></a><var>82.7</var>    (e) If the tax or any part of the tax imposed by this subdivision is held to be <br/>
<a id="pl.82.8"></a><var>82.8</var>unconstitutional, a tax of $2.103 per gross ton of merchantable iron ore concentrate <br/>
<a id="pl.82.9"></a><var>82.9</var>produced shall be imposed.<br/>
<a id="pl.82.10"></a><var>82.10</var>    (f) Consistent with the intent of this subdivision to impose a tax based upon the <br/>
<a id="pl.82.11"></a><var>82.11</var>weight of merchantable iron ore concentrate, the commissioner of revenue may indirectly <br/>
<a id="pl.82.12"></a><var>82.12</var>determine the weight of merchantable iron ore concentrate included in fluxed pellets by <br/>
<a id="pl.82.13"></a><var>82.13</var>subtracting the weight of the limestone, dolomite, or olivine derivatives or other basic <br/>
<a id="pl.82.14"></a><var>82.14</var>flux additives included in the pellets from the weight of the pellets. For purposes of this <br/>
<a id="pl.82.15"></a><var>82.15</var>paragraph, "fluxed pellets" are pellets produced in a process in which limestone, dolomite, <br/>
<a id="pl.82.16"></a><var>82.16</var>olivine, or other basic flux additives are combined with merchantable iron ore concentrate. <br/>
<a id="pl.82.17"></a><var>82.17</var>No subtraction from the weight of the pellets shall be allowed for binders, mineral and <br/>
<a id="pl.82.18"></a><var>82.18</var>chemical additives other than basic flux additives, or moisture.<br/>
<a id="pl.82.19"></a><var>82.19</var>    (g)(1) Notwithstanding any other provision of this subdivision, for the first two years <br/>
<a id="pl.82.20"></a><var>82.20</var>of a plant's commercial production of direct reduced ore, no tax is imposed under this <br/>
<a id="pl.82.21"></a><var>82.21</var>section. As used in this paragraph, "commercial production" is production of more than <br/>
<a id="pl.82.22"></a><var>82.22</var>50,000 tons of direct reduced ore in the current year or in any prior year, "noncommercial <br/>
<a id="pl.82.23"></a><var>82.23</var>production" is production of 50,000 tons or less of direct reduced ore in any year, and <br/>
<a id="pl.82.24"></a><var>82.24</var>"direct reduced ore" is ore that results in a product that has an iron content of at least 75 <br/>
<a id="pl.82.25"></a><var>82.25</var>percent. For the third year of a plant's commercial production of direct reduced ore, the <br/>
<a id="pl.82.26"></a><var>82.26</var>rate to be applied to direct reduced ore is 25 percent of the rate otherwise determined <br/>
<a id="pl.82.27"></a><var>82.27</var>under this subdivision. For the fourth commercial production year, the rate is 50 percent of <br/>
<a id="pl.82.28"></a><var>82.28</var>the rate otherwise determined under this subdivision; for the fifth commercial production <br/>
<a id="pl.82.29"></a><var>82.29</var>year, the rate is 75 percent of the rate otherwise determined under this subdivision; and for <br/>
<a id="pl.82.30"></a><var>82.30</var>all subsequent commercial production years, the full rate is imposed.<br/>
<a id="pl.82.31"></a><var>82.31</var>    (2) Subject to clause (1), production of direct reduced ore in this state is subject to <br/>
<a id="pl.82.32"></a><var>82.32</var>the tax imposed by this section, but if that production is not produced by a producer <br/>
<a id="pl.82.33"></a><var>82.33</var>of taconite or iron sulfides, the production of taconite or iron sulfides consumed in the <br/>
<a id="pl.82.34"></a><var>82.34</var>production of direct reduced iron in this state is not subject to the tax imposed by this <br/>
<a id="pl.82.35"></a><var>82.35</var>section on taconite or iron sulfides.<br/>
<a id="pl.83.1"></a><var>83.1</var>    (3) Notwithstanding any other provision of this subdivision, no tax is imposed <br/>
<a id="pl.83.2"></a><var>83.2</var>on direct reduced ore under this section during the facility's noncommercial production <br/>
<a id="pl.83.3"></a><var>83.3</var>of direct reduced ore. The taconite or iron sulphides consumed in the noncommercial <br/>
<a id="pl.83.4"></a><var>83.4</var>production of direct reduced ore is subject to the tax imposed by this section on taconite <br/>
<a id="pl.83.5"></a><var>83.5</var>and iron sulphides. Three-year average production of direct reduced ore does not <br/>
<a id="pl.83.6"></a><var>83.6</var>include production of direct reduced ore in any noncommercial year. Three-year average <br/>
<a id="pl.83.7"></a><var>83.7</var>production for a direct reduced ore facility that has noncommercial production is the <br/>
<a id="pl.83.8"></a><var>83.8</var>average of the commercial production of direct reduced ore for the current year and the <br/>
<a id="pl.83.9"></a><var>83.9</var>previous two commercial years.<br/>
<a id="pl.83.10"></a><var>83.10</var>    (4) This paragraph applies only to plants for which all environmental permits have <br/>
<a id="pl.83.11"></a><var>83.11</var>been obtained and construction has begun before July 1, 2008.<br/>
<a id="pl.83.12"></a><var>83.12</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.8.6.0"></a><a id="pl.83.13"></a><var>83.13</var>    Sec. 6. Minnesota Statutes 2006, section 298.25, is amended to read:<br/>
<a id="pl.83.14"></a><var>83.14</var><b>298.25 TAXES ADDITIONAL TO OCCUPATION TAX; IN LIEU OF OTHER </b><br/>
<a id="pl.83.15"></a><var>83.15</var><b>TAXES.</b><br/>
<a id="pl.83.16"></a><var>83.16</var>    The taxes imposed under section 
         <statute_ref>298.24</statute_ref> shall be in addition to the occupation tax <br/>
<a id="pl.83.17"></a><var>83.17</var>imposed upon the business of mining and producing iron ore. Except as herein otherwise <br/>
<a id="pl.83.18"></a><var>83.18</var>provided, such taxes shall be in lieu of all other taxes upon such taconite, iron sulphides, <br/>
<a id="pl.83.19"></a><var>83.19</var>and direct reduced ore or the lands in which they are contained, or upon the mining or <br/>
<a id="pl.83.20"></a><var>83.20</var>quarrying thereof, or the production of concentrate or direct reduced ore therefrom, or <br/>
<a id="pl.83.21"></a><var>83.21</var>upon the concentrate or direct reduced ore produced, or upon the machinery, equipment, <br/>
<a id="pl.83.22"></a><var>83.22</var>tools, supplies and buildings used in such mining, quarrying or production, or upon the <br/>
<a id="pl.83.23"></a><var>83.23</var>lands occupied by, or used in connection with, such mining, quarrying or production <br/>
<a id="pl.83.24"></a><var>83.24</var>facilities. If electric or steam power for the mining, transportation or concentration of <br/>
<a id="pl.83.25"></a><var>83.25</var>such taconite, concentrates or direct reduced ore produced therefrom is generated in <br/>
<a id="pl.83.26"></a><var>83.26</var>plants principally devoted to the generation of power for such purposes, the plants in <br/>
<a id="pl.83.27"></a><var>83.27</var>which such power is generated and all machinery, equipment, tools, supplies, transmission <br/>
<a id="pl.83.28"></a><var>83.28</var>and distribution lines used in the generation and distribution of such power, shall not be <br/>
<a id="pl.83.29"></a><var>83.29</var>considered to be machinery, equipment, tools, supplies and buildings used in the mining, <br/>
<a id="pl.83.30"></a><var>83.30</var>quarrying, or production of taconite, taconite concentrates or direct reduced ore within <br/>
<a id="pl.83.31"></a><var>83.31</var>the meaning of this section, and shall be subject to general property taxation. If part <br/>
<a id="pl.83.32"></a><var>83.32</var>of the power generated in such a plant is used for purposes other than the mining or <br/>
<a id="pl.83.33"></a><var>83.33</var>concentration of taconite or direct reduced ore or the transportation or loading of taconite, <br/>
<a id="pl.83.34"></a><var>83.34</var>the concentrates thereof or direct reduced ore, a proportionate share of the value of such <br/>
<a id="pl.84.1"></a><var>84.1</var>generating facilities, equal to the proportion that the power used for such other purpose <br/>
<a id="pl.84.2"></a><var>84.2</var>bears to the generating capacity of the plant, shall be subject to the general property tax <br/>
<a id="pl.84.3"></a><var>84.3</var>in the same manner as other property; provided, power generated in such a plant and <br/>
<a id="pl.84.4"></a><var>84.4</var>exchanged for an equivalent amount of power which is used for the mining, transportation, <br/>
<a id="pl.84.5"></a><var>84.5</var>or concentration of such taconite, concentrates or direct reduced ore produced therefrom, <br/>
<a id="pl.84.6"></a><var>84.6</var>shall be considered as used for such purposes within the meaning of this section. Nothing <br/>
<a id="pl.84.7"></a><var>84.7</var>herein shall prevent the assessment and taxation of the surface of reserve land containing <br/>
<a id="pl.84.8"></a><var>84.8</var>taconite and not occupied by such facilities or used in connection therewith at the value <br/>
<a id="pl.84.9"></a><var>84.9</var>thereof without regard to the taconite or iron sulphides therein, nor the assessment and <br/>
<a id="pl.84.10"></a><var>84.10</var>taxation of merchantable iron ore or other minerals, or iron-bearing materials other than <br/>
<a id="pl.84.11"></a><var>84.11</var>taconite or iron sulphides in such lands in the manner provided by law, nor the assessment <br/>
<a id="pl.84.12"></a><var>84.12</var>and taxation of facilities used in producing sulphur or sulphur products from iron sulphide <br/>
<a id="pl.84.13"></a><var>84.13</var>concentrates, or in refining such sulphur products, under the general property tax laws. <br/>
<a id="pl.84.14"></a><var>84.14</var>Nothing herein shall except from general taxation or from taxation as provided by other <br/>
<a id="pl.84.15"></a><var>84.15</var>laws any property used for residential or townsite purposes, including utility services <br/>
<a id="pl.84.16"></a><var>84.16</var>thereto. This section does not provide an exemption from general property taxation for ore <br/>
<a id="pl.84.17"></a><var>84.17</var>docks even if located at the site of a taconite production facility. <br/>
<a id="pl.84.18"></a><var>84.18</var><b>EFFECTIVE DATE.</b>This section is effective for taxes levied in 2008, payable <br/>
<a id="pl.84.19"></a><var>84.19</var>in 2009, and thereafter.<br/>
<br/>
<a id="bill.8.7.0"></a><a id="pl.84.20"></a><var>84.20</var>    Sec. 7. Minnesota Statutes 2006, section 298.28, subdivision 4, is amended to read:<br/>
<a id="pl.84.21"></a><var>84.21</var>    Subd. 4. <b>School districts.</b> (a) 
         <statute_ref>17.15 23.15</statute_ref> cents per taxable ton, plus the increase <br/>
<a id="pl.84.22"></a><var>84.22</var>provided in paragraph (d) must be allocated to qualifying school districts to be distributed, <br/>
<a id="pl.84.23"></a><var>84.23</var>based upon the certification of the commissioner of revenue, under paragraphs (b) and, <br/>
<a id="pl.84.24"></a><var>84.24</var>(c), except as otherwise provided in paragraph and (f). <br/>
<a id="pl.84.25"></a><var>84.25</var>    (b) 
         <statute_ref>(i) 3.43</statute_ref> cents per taxable ton must be distributed to the school districts in which <br/>
<a id="pl.84.26"></a><var>84.26</var>the lands from which taconite was mined or quarried were located or within which the <br/>
<a id="pl.84.27"></a><var>84.27</var>concentrate was produced. The distribution must be based on the apportionment formula <br/>
<a id="pl.84.28"></a><var>84.28</var>prescribed in subdivision 2. <br/>
<a id="pl.84.29"></a><var>84.29</var>    (ii) Four cents per taxable ton from each taconite facility must be distributed to <br/>
<a id="pl.84.30"></a><var>84.30</var>each affected school district for deposit in a fund dedicated to building maintenance <br/>
<a id="pl.84.31"></a><var>84.31</var>and repairs, as follows:<br/>
<a id="pl.84.32"></a><var>84.32</var>    (1) proceeds from Keewatin Taconite or its successor are distributed to Independent <br/>
<a id="pl.84.33"></a><var>84.33</var>School Districts Nos. 316, Coleraine, and 319, Nashwauk-Keewatin, or their successor <br/>
<a id="pl.84.34"></a><var>84.34</var>districts;<br/>
<a id="pl.85.1"></a><var>85.1</var>    (2) proceeds from the Hibbing Taconite Company or its successor are distributed to <br/>
<a id="pl.85.2"></a><var>85.2</var>Independent School Districts Nos. 695, Chisholm, and 701, Hibbing, or their successor <br/>
<a id="pl.85.3"></a><var>85.3</var>districts;<br/>
<a id="pl.85.4"></a><var>85.4</var>    (3) proceeds from the Mittal Steel Company and Minntac or their successors are <br/>
<a id="pl.85.5"></a><var>85.5</var>distributed to Independent School Districts Nos. 712, Mountain Iron-Buhl, 706, Virginia, <br/>
<a id="pl.85.6"></a><var>85.6</var>2711, Mesabi East, and 2154, Eveleth-Gilbert, or their successor districts; <br/>
<a id="pl.85.7"></a><var>85.7</var>    (4) proceeds from the Northshore Mining Company or its successor are distributed <br/>
<a id="pl.85.8"></a><var>85.8</var>to Independent School Districts Nos. 2142, St. Louis County, and 381, Lake Superior, <br/>
<a id="pl.85.9"></a><var>85.9</var>or their successor districts; and<br/>
<a id="pl.85.10"></a><var>85.10</var>    (5) proceeds from United Taconite or its successor are distributed to Independent <br/>
<a id="pl.85.11"></a><var>85.11</var>School Districts Nos. 2142, St. Louis County, and 2154, Eveleth-Gilbert, or their <br/>
<a id="pl.85.12"></a><var>85.12</var>successor districts.<br/>
<a id="pl.85.13"></a><var>85.13</var>    Revenues that are required to be distributed to more than one district shall be <br/>
<a id="pl.85.14"></a><var>85.14</var>apportioned according to the number of pupil units identified in section 126C.05, <br/>
<a id="pl.85.15"></a><var>85.15</var>subdivision 1, enrolled in the second previous year.<br/>
<a id="pl.85.16"></a><var>85.16</var>    (c)(i) 
         <statute_ref>13.72</statute_ref> 15.72 cents per taxable ton, less any amount distributed under paragraph <br/>
<a id="pl.85.17"></a><var>85.17</var>(e), shall be distributed to a group of school districts comprised of those school districts <br/>
<a id="pl.85.18"></a><var>85.18</var>which qualify as a tax relief area under section 
         <statute_ref>273.134, paragraph (b)</statute_ref>, or in which there is <br/>
<a id="pl.85.19"></a><var>85.19</var>a qualifying municipality as defined by section 
         <statute_ref>273.134, paragraph (a)</statute_ref>, in direct proportion <br/>
<a id="pl.85.20"></a><var>85.20</var>to school district indexes as follows: for each school district, its pupil units determined <br/>
<a id="pl.85.21"></a><var>85.21</var>under section 
         <statute_ref>126C.05</statute_ref> for the prior school year shall be multiplied by the ratio of the <br/>
<a id="pl.85.22"></a><var>85.22</var>average adjusted net tax capacity per pupil unit for school districts receiving aid under <br/>
<a id="pl.85.23"></a><var>85.23</var>this clause as calculated pursuant to chapters 122A, 126C, and 127A for the school year <br/>
<a id="pl.85.24"></a><var>85.24</var>ending prior to distribution to the adjusted net tax capacity per pupil unit of the district. <br/>
<a id="pl.85.25"></a><var>85.25</var>Each district shall receive that portion of the distribution which its index bears to the sum <br/>
<a id="pl.85.26"></a><var>85.26</var>of the indices for all school districts that receive the distributions. <br/>
<a id="pl.85.27"></a><var>85.27</var>    (ii) Notwithstanding clause (i), each school district that receives a distribution <br/>
<a id="pl.85.28"></a><var>85.28</var>under sections 
         <statute_ref>298.018</statute_ref>; 
         <statute_ref>298.23</statute_ref> to 
         <statute_ref>298.28</statute_ref>, exclusive of any amount received under this <br/>
<a id="pl.85.29"></a><var>85.29</var>clause; 
         <statute_ref>298.34</statute_ref> to 
         <statute_ref>298.39</statute_ref>; 
         <statute_ref>298.391</statute_ref> to 
         <statute_ref>298.396</statute_ref>; 
         <statute_ref>298.405</statute_ref>; or any law imposing a tax on <br/>
<a id="pl.85.30"></a><var>85.30</var>severed mineral values after reduction for any portion distributed to cities and towns under <br/>
<a id="pl.85.31"></a><var>85.31</var>section 
         <statute_ref>126C.48, subdivision 8</statute_ref>, paragraph (5), that is less than the amount of its levy <br/>
<a id="pl.85.32"></a><var>85.32</var>reduction under section 
         <statute_ref>126C.48, subdivision 8</statute_ref>, for the second year prior to the year of the <br/>
<a id="pl.85.33"></a><var>85.33</var>distribution shall receive a distribution equal to the difference; the amount necessary to <br/>
<a id="pl.85.34"></a><var>85.34</var>make this payment shall be derived from proportionate reductions in the initial distribution <br/>
<a id="pl.85.35"></a><var>85.35</var>to other school districts under clause (i). <br/>
<a id="pl.86.1"></a><var>86.1</var>    (d) Any school district described in paragraph (c) where a levy increase pursuant to <br/>
<a id="pl.86.2"></a><var>86.2</var>section 
         <statute_ref>126C.17, subdivision 9</statute_ref>, was authorized by referendum for taxes payable in 2001, <br/>
<a id="pl.86.3"></a><var>86.3</var>shall receive a distribution of 21.3 cents per ton. Each district shall receive $175 times the <br/>
<a id="pl.86.4"></a><var>86.4</var>pupil units identified in section 
         <statute_ref>126C.05, subdivision 1</statute_ref>, enrolled in the second previous <br/>
<a id="pl.86.5"></a><var>86.5</var>year or the 1983-1984 school year, whichever is greater, less the product of 1.8 percent <br/>
<a id="pl.86.6"></a><var>86.6</var>times the district's taxable net tax capacity in the second previous year. <br/>
<a id="pl.86.7"></a><var>86.7</var>    If the total amount provided by paragraph (d) is insufficient to make the payments <br/>
<a id="pl.86.8"></a><var>86.8</var>herein required then the entitlement of $175 per pupil unit shall be reduced uniformly <br/>
<a id="pl.86.9"></a><var>86.9</var>so as not to exceed the funds available. Any amounts received by a qualifying school <br/>
<a id="pl.86.10"></a><var>86.10</var>district in any fiscal year pursuant to paragraph (d) shall not be applied to reduce general <br/>
<a id="pl.86.11"></a><var>86.11</var>education aid which the district receives pursuant to section 
         <statute_ref>126C.13</statute_ref> or the permissible <br/>
<a id="pl.86.12"></a><var>86.12</var>levies of the district. Any amount remaining after the payments provided in this paragraph <br/>
<a id="pl.86.13"></a><var>86.13</var>shall be paid to the commissioner of Iron Range resources and rehabilitation who shall <br/>
<a id="pl.86.14"></a><var>86.14</var>deposit the same in the taconite environmental protection fund and the Douglas J. Johnson <br/>
<a id="pl.86.15"></a><var>86.15</var>economic protection trust fund as provided in subdivision 11. <br/>
<a id="pl.86.16"></a><var>86.16</var>    Each district receiving money according to this paragraph shall reserve the lesser of <br/>
<a id="pl.86.17"></a><var>86.17</var>the amount received under this paragraph or $25 times the number of pupil units served <br/>
<a id="pl.86.18"></a><var>86.18</var>in the district. It may use the money for early childhood programs or for outcome-based <br/>
<a id="pl.86.19"></a><var>86.19</var>learning programs that enhance the academic quality of the district's curriculum. The <br/>
<a id="pl.86.20"></a><var>86.20</var>outcome-based learning programs must be approved by the commissioner of education.<br/>
<a id="pl.86.21"></a><var>86.21</var>    (e) There shall be distributed to any school district the amount which the school <br/>
<a id="pl.86.22"></a><var>86.22</var>district was entitled to receive under section 
         <statute_ref>298.32</statute_ref> in 1975. <br/>
<a id="pl.86.23"></a><var>86.23</var>    (f) Effective for the distribution in 2003 only, five percent of the distributions to <br/>
<a id="pl.86.24"></a><var>86.24</var>school districts under paragraphs (b), (c), and (e); subdivision 6, paragraph (c); subdivision <br/>
<a id="pl.86.25"></a><var>86.25</var>11; and section 
<statute_ref>298.225</statute_ref>, shall be distributed to the general fund. The remainder less any <br/>
<a id="pl.86.26"></a><var>86.26</var>portion distributed to cities and towns under section 
<statute_ref>126C.48, subdivision 8</statute_ref>, paragraph <br/>
<a id="pl.86.27"></a><var>86.27</var>(5), shall be distributed to the Douglas J. Johnson economic protection trust fund created <br/>
<a id="pl.86.28"></a><var>86.28</var>in section 
<statute_ref>298.292</statute_ref>. Fifty percent of the amount distributed to the Douglas J. Johnson <br/>
<a id="pl.86.29"></a><var>86.29</var>economic protection trust fund shall be made available for expenditure under section <br/>
<a id="pl.86.30"></a><var>86.30</var><statute_ref>298.293</statute_ref> as governed by section 
<statute_ref>298.296</statute_ref>. Effective in 2003 only, 100 percent of the <br/>
<a id="pl.86.31"></a><var>86.31</var>distributions to school districts under section 
<statute_ref>477A.15</statute_ref> less any portion distributed to cities <br/>
<a id="pl.86.32"></a><var>86.32</var>and towns under section 
<statute_ref>126C.48, subdivision 8</statute_ref>, paragraph (5), shall be distributed to the <br/>
<a id="pl.86.33"></a><var>86.33</var>general fund. Four cents per taxable ton must be distributed to qualifying school districts <br/>
<a id="pl.86.34"></a><var>86.34</var>according to the distribution specified in paragraph (b), clause (ii), and two cents per <br/>
<a id="pl.86.35"></a><var>86.35</var>taxable ton must be distributed according to the distribution specified in paragraph (c). <br/>
<a id="pl.86.36"></a><var>86.36</var>These amounts are not subject to section 126C.48, subdivision 8.<br/>
<a id="pl.87.1"></a><var>87.1</var><b>EFFECTIVE DATE.</b>This section is effective for distributions in 2009 and <br/>
<a id="pl.87.2"></a><var>87.2</var>thereafter.<br/>
<br/>
<a id="bill.8.8.0"></a><a id="pl.87.3"></a><var>87.3</var>    Sec. 8. Minnesota Statutes 2006, section 298.28, subdivision 5, is amended to read:<br/>
<a id="pl.87.4"></a><var>87.4</var>    Subd. 5. <b>Counties.</b> (a) 
         <statute_ref>26.05</statute_ref> cents per taxable ton is allocated to counties to be <br/>
<a id="pl.87.5"></a><var>87.5</var>distributed, based upon certification by the commissioner of revenue, under paragraphs <br/>
<a id="pl.87.6"></a><var>87.6</var>(b) to (d). <br/>
<a id="pl.87.7"></a><var>87.7</var>    (b) 
         <statute_ref>20.525</statute_ref> 15.525 cents per taxable ton shall be distributed to the county in which <br/>
<a id="pl.87.8"></a><var>87.8</var>the taconite is mined or quarried or in which the concentrate is produced, less any <br/>
<a id="pl.87.9"></a><var>87.9</var>amount which is to be distributed pursuant to paragraph (c). The apportionment formula <br/>
<a id="pl.87.10"></a><var>87.10</var>prescribed in subdivision 2 is the basis for the distribution. <br/>
<a id="pl.87.11"></a><var>87.11</var>    (c) If an electric power plant owned by and providing the primary source of power <br/>
<a id="pl.87.12"></a><var>87.12</var>for a taxpayer mining and concentrating taconite is located in a county other than the <br/>
<a id="pl.87.13"></a><var>87.13</var>county in which the mining and the concentrating processes are conducted, one cent per <br/>
<a id="pl.87.14"></a><var>87.14</var>taxable ton of the tax distributed to the counties pursuant to paragraph (b) and imposed <br/>
<a id="pl.87.15"></a><var>87.15</var>on and collected from such taxpayer shall be paid to the county in which the power plant <br/>
<a id="pl.87.16"></a><var>87.16</var>is located.<br/>
<a id="pl.87.17"></a><var>87.17</var>    (d) 5.525 10.525 cents per taxable ton shall be paid to the county from which the <br/>
<a id="pl.87.18"></a><var>87.18</var>taconite was mined, quarried or concentrated to be deposited in the county road and <br/>
<a id="pl.87.19"></a><var>87.19</var>bridge fund. If the mining, quarrying and concentrating, or separate steps in any of those <br/>
<a id="pl.87.20"></a><var>87.20</var>processes are carried on in more than one county, the commissioner shall follow the <br/>
<a id="pl.87.21"></a><var>87.21</var>apportionment formula prescribed in subdivision 2. <br/>
<a id="pl.87.22"></a><var>87.22</var><b>EFFECTIVE DATE.</b>This section is effective for distributions in 2009 and <br/>
<a id="pl.87.23"></a><var>87.23</var>thereafter.<br/>
<br/>
<a id="bill.8.9.0"></a><a id="pl.87.24"></a><var>87.24</var>    Sec. 9. Minnesota Statutes 2006, section 298.28, is amended by adding a subdivision <br/>
<a id="pl.87.25"></a><var>87.25</var>to read:<br/>
<a id="pl.87.26"></a><var>87.26</var>    Subd. 9d. <b>Iron Range higher education account.</b> Two cents per taxable ton must <br/>
<a id="pl.87.27"></a><var>87.27</var>be allocated to the Iron Range Resources and Rehabilitation Board to be deposited in <br/>
<a id="pl.87.28"></a><var>87.28</var>an Iron Range higher education account that is hereby created, to be used for higher <br/>
<a id="pl.87.29"></a><var>87.29</var>education programs conducted at educational institutions in the taconite assistance area <br/>
<a id="pl.87.30"></a><var>87.30</var>defined in section 273.1341. The Iron Range Higher Education committee under section <br/>
<a id="pl.87.31"></a><var>87.31</var>298.2214 and the Iron Range Resources and Rehabilitation Board must approve all <br/>
<a id="pl.87.32"></a><var>87.32</var>expenditures from the account.<br/>
<a id="pl.88.1"></a><var>88.1</var><b>EFFECTIVE DATE.</b>This section is effective for production in 2007, distributions <br/>
<a id="pl.88.2"></a><var>88.2</var>in 2008, and thereafter.<br/>
<br/>
<a id="bill.8.10.0"></a><a id="pl.88.3"></a><var>88.3</var>    Sec. 10. Minnesota Statutes 2006, section 298.282, subdivision 1, is amended to read:<br/>
<a id="pl.88.4"></a><var>88.4</var>    Subdivision 1. <b>Distribution of taconite municipal aid account.</b> The amount <br/>
<a id="pl.88.5"></a><var>88.5</var>deposited with the county as provided in section 
         <statute_ref>298.28, subdivision 3</statute_ref>, must be distributed <br/>
<a id="pl.88.6"></a><var>88.6</var>as provided by this section among: (1) the municipalities comprising a tax relief area <br/>
<a id="pl.88.7"></a><var>88.7</var>under section 
         <statute_ref>273.134, paragraph (b)</statute_ref>,; (2) a township that contains a state park consisting <br/>
<a id="pl.88.8"></a><var>88.8</var>primarily of an underground iron ore mine; and (3) a city located within five miles of that <br/>
<a id="pl.88.9"></a><var>88.9</var>state park, each being referred to in this section as a qualifying municipality. <br/>
<a id="pl.88.10"></a><var>88.10</var><b>EFFECTIVE DATE.</b>This section is effective for distributions in 2008 and <br/>
<a id="pl.88.11"></a><var>88.11</var>thereafter.<br/>
<br/>
<a id="bill.8.11.0"></a><a id="pl.88.12"></a><var>88.12</var>    Sec. 11. Minnesota Statutes 2006, section 298.292, subdivision 2, is amended to read:<br/>
<a id="pl.88.13"></a><var>88.13</var>    Subd. 2. <b>Use of money.</b> Money in the Douglas J. Johnson economic protection trust <br/>
<a id="pl.88.14"></a><var>88.14</var>fund may be used for the following purposes:<br/>
<a id="pl.88.15"></a><var>88.15</var>    (1) to provide loans, loan guarantees, interest buy-downs and other forms of <br/>
<a id="pl.88.16"></a><var>88.16</var>participation with private sources of financing, but a loan to a private enterprise shall be <br/>
<a id="pl.88.17"></a><var>88.17</var>for a principal amount not to exceed one-half of the cost of the project for which financing <br/>
<a id="pl.88.18"></a><var>88.18</var>is sought, and the rate of interest on a loan to a private enterprise shall be no less than the <br/>
<a id="pl.88.19"></a><var>88.19</var>lesser of eight percent or an interest rate three percentage points less than a full faith <br/>
<a id="pl.88.20"></a><var>88.20</var>and credit obligation of the United States government of comparable maturity, at the <br/>
<a id="pl.88.21"></a><var>88.21</var>time that the loan is approved;<br/>
<a id="pl.88.22"></a><var>88.22</var>    (2) to fund reserve accounts established to secure the payment when due of the <br/>
<a id="pl.88.23"></a><var>88.23</var>principal of and interest on bonds issued pursuant to section 
         <statute_ref>298.2211</statute_ref>; <br/>
<a id="pl.88.24"></a><var>88.24</var>    (3) to pay in periodic payments or in a lump sum payment any or all of the interest <br/>
<a id="pl.88.25"></a><var>88.25</var>on bonds issued pursuant to chapter 474 for the purpose of constructing, converting, <br/>
<a id="pl.88.26"></a><var>88.26</var>or retrofitting heating facilities in connection with district heating systems or systems <br/>
<a id="pl.88.27"></a><var>88.27</var>utilizing alternative energy sources; and<br/>
<a id="pl.88.28"></a><var>88.28</var>    (4) to invest in a venture capital fund or enterprise that will provide capital to other <br/>
<a id="pl.88.29"></a><var>88.29</var>entities that are engaging in, or that will engage in, projects or programs that have the <br/>
<a id="pl.88.30"></a><var>88.30</var>purposes set forth in subdivision 1. No investments may be made in a venture capital fund <br/>
<a id="pl.88.31"></a><var>88.31</var>or enterprise unless at least two other unrelated investors make investments of at least <br/>
<a id="pl.88.32"></a><var>88.32</var>$500,000 in the venture capital fund or enterprise, and the investment by the Douglas <br/>
<a id="pl.88.33"></a><var>88.33</var>J. Johnson economic protection trust fund may not exceed the amount of the largest <br/>
<a id="pl.88.34"></a><var>88.34</var>investment by an unrelated investor in the venture capital fund or enterprise. For purposes <br/>
<a id="pl.89.1"></a><var>89.1</var>of this subdivision, an "unrelated investor" is a person or entity that is not related to <br/>
<a id="pl.89.2"></a><var>89.2</var>the entity in which the investment is made or to any individual who owns more than 40 <br/>
<a id="pl.89.3"></a><var>89.3</var>percent of the value of the entity, in any of the following relationships: spouse, parent, <br/>
<a id="pl.89.4"></a><var>89.4</var>child, sibling, employee, or owner of an interest in the entity that exceeds ten percent of <br/>
<a id="pl.89.5"></a><var>89.5</var>the value of all interests in it. For purposes of determining the limitations under this <br/>
<a id="pl.89.6"></a><var>89.6</var>clause, the amount of investments made by an investor other than the Douglas J. Johnson <br/>
<a id="pl.89.7"></a><var>89.7</var>economic protection trust fund is the sum of all investments made in the venture capital <br/>
<a id="pl.89.8"></a><var>89.8</var>fund or enterprise during the period beginning one year before the date of the investment <br/>
<a id="pl.89.9"></a><var>89.9</var>by the Douglas J. Johnson economic protection trust fund; and<br/>
<a id="pl.89.10"></a><var>89.10</var>    (5) to purchase forest land in the taconite assistance area defined in section 273.1341 <br/>
<a id="pl.89.11"></a><var>89.11</var>to be held and managed as a public trust for the benefit of the area for the purposes <br/>
<a id="pl.89.12"></a><var>89.12</var>authorized in section 298.22, subdivision 5a.<br/>
<a id="pl.89.13"></a><var>89.13</var>    Money from the trust fund shall be expended only in or for the benefit of the taconite <br/>
<a id="pl.89.14"></a><var>89.14</var>assistance area defined in section 
         <statute_ref>273.1341</statute_ref>. <br/>
<a id="pl.89.15"></a><var>89.15</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.8.12.0"></a><a id="pl.89.16"></a><var>89.16</var>    Sec. 12. Minnesota Statutes 2006, section 298.296, subdivision 2, is amended to read:<br/>
<a id="pl.89.17"></a><var>89.17</var>    Subd. 2. <b>Expenditure of funds.</b> (a) Before January 1, 2028, funds may be expended <br/>
<a id="pl.89.18"></a><var>89.18</var>on projects and for administration of the trust fund only from the net interest, earnings, <br/>
<a id="pl.89.19"></a><var>89.19</var>and dividends arising from the investment of the trust at any time, including net interest, <br/>
<a id="pl.89.20"></a><var>89.20</var>earnings, and dividends that have arisen prior to July 13, 1982, plus $10,000,000 made <br/>
<a id="pl.89.21"></a><var>89.21</var>available for use in fiscal year 1983, except that any amount required to be paid out of the <br/>
<a id="pl.89.22"></a><var>89.22</var>trust fund to provide the property tax relief specified in Laws 1977, chapter 423, article <br/>
<a id="pl.89.23"></a><var>89.23</var>X, section 4, and to make school bond payments and payments to recipients of taconite <br/>
<a id="pl.89.24"></a><var>89.24</var>production tax proceeds pursuant to section 
         <statute_ref>298.225</statute_ref>, may be taken from the corpus of <br/>
<a id="pl.89.25"></a><var>89.25</var>the trust. <br/>
<a id="pl.89.26"></a><var>89.26</var>    (b) Additionally, upon recommendation by the board, up to $13,000,000 from the <br/>
<a id="pl.89.27"></a><var>89.27</var>corpus of the trust may be made available for use as provided in subdivision 4, and up to <br/>
<a id="pl.89.28"></a><var>89.28</var>$10,000,000 from the corpus of the trust may be made available for use as provided in <br/>
<a id="pl.89.29"></a><var>89.29</var>section 
         <statute_ref>298.2961</statute_ref>. <br/>
<a id="pl.89.30"></a><var>89.30</var>    (c) Additionally, an amount equal to 20 percent of the value of the corpus of the trust <br/>
<a id="pl.89.31"></a><var>89.31</var>on May 18, 2002, not including the funds authorized in paragraph (b), plus the amounts <br/>
<a id="pl.89.32"></a><var>89.32</var>made available under section 
         <statute_ref>298.28, subdivision 4</statute_ref>, and Laws 2002, chapter 377, article <br/>
<a id="pl.89.33"></a><var>89.33</var>8, section 17, may be expended on projects. Funds may be expended for projects under <br/>
<a id="pl.89.34"></a><var>89.34</var>this paragraph only if the project: <br/>
<a id="pl.90.1"></a><var>90.1</var>    (1) is for the purposes established under section 
         <statute_ref>298.292, subdivision 1</statute_ref>, clause <br/>
<a id="pl.90.2"></a><var>90.2</var>(1) or (2); and <br/>
<a id="pl.90.3"></a><var>90.3</var>    (2) is approved by the board upon an affirmative vote of at least ten of its members.<br/>
<a id="pl.90.4"></a><var>90.4</var>No money made available under this paragraph or paragraph (d) can be used for <br/>
<a id="pl.90.5"></a><var>90.5</var>administrative or operating expenses of the Iron Range Resources and Rehabilitation <br/>
<a id="pl.90.6"></a><var>90.6</var>Board or expenses relating to any facilities owned or operated by the board on May 18, <br/>
<a id="pl.90.7"></a><var>90.7</var>2002.<br/>
<a id="pl.90.8"></a><var>90.8</var>    (d) Upon recommendation by a unanimous vote of all members of the board, <br/>
<a id="pl.90.9"></a><var>90.9</var>amounts in addition to those authorized under paragraphs (a), (b), and (c) may be <br/>
<a id="pl.90.10"></a><var>90.10</var>expended on projects described in section 
         <statute_ref>298.292, subdivision 1</statute_ref>. <br/>
<a id="pl.90.11"></a><var>90.11</var>    (e) Annual administrative costs, not including detailed engineering expenses for the <br/>
<a id="pl.90.12"></a><var>90.12</var>projects, shall not exceed five percent of the net interest, dividends, and earnings arising <br/>
<a id="pl.90.13"></a><var>90.13</var>from the trust in the preceding fiscal year.<br/>
<a id="pl.90.14"></a><var>90.14</var>    (f) Principal and interest received in repayment of loans made pursuant to this <br/>
<a id="pl.90.15"></a><var>90.15</var>section, and earnings on other investments made under section 
         <statute_ref>298.292, subdivision 2</statute_ref>, <br/>
<a id="pl.90.16"></a><var>90.16</var>clause (4), shall be deposited in the state treasury and credited to the trust. These receipts <br/>
<a id="pl.90.17"></a><var>90.17</var>are appropriated to the board for the purposes of sections 
         <statute_ref>298.291</statute_ref> to 
         <statute_ref>298.298</statute_ref>. <br/>
<a id="pl.90.18"></a><var>90.18</var>    (g) Additionally, notwithstanding section 298.293, upon affirmative vote of a <br/>
<a id="pl.90.19"></a><var>90.19</var>majority of the members of the board, money from the corpus of the trust may be expanded <br/>
<a id="pl.90.20"></a><var>90.20</var>to purchase forest lands within the taconite assistance area as provided in sections 298.22, <br/>
<a id="pl.90.21"></a><var>90.21</var>subdivision 5a, and 298.292, subdivision 2, clause (5).<br/>
<a id="pl.90.22"></a><var>90.22</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.8.13.0"></a><a id="pl.90.23"></a><var>90.23</var>    Sec. 13. Minnesota Statutes 2006, section 298.2961, subdivision 4, is amended to read:<br/>
<a id="pl.90.24"></a><var>90.24</var>    Subd. 4. <b>Grant and loan fund.</b> (a) A fund is established to receive distributions <br/>
<a id="pl.90.25"></a><var>90.25</var>under section 
         <statute_ref>298.28, subdivision 9b</statute_ref>, and to make grants or loans as provided in this <br/>
<a id="pl.90.26"></a><var>90.26</var>subdivision. Any grant or loan made under this subdivision must be approved by <br/>
<a id="pl.90.27"></a><var>90.27</var>a majority of the members of the Iron Range Resources and Rehabilitation Board, <br/>
<a id="pl.90.28"></a><var>90.28</var>established under section 
         <statute_ref>298.22</statute_ref>.<br/>
<a id="pl.90.29"></a><var>90.29</var>    (b) Distributions received in calendar year 2005 are allocated to the city of Virginia <br/>
<a id="pl.90.30"></a><var>90.30</var>for improvements and repairs to the city's steam heating system.<br/>
<a id="pl.90.31"></a><var>90.31</var>    (c) Distributions received in calendar year 2006 are allocated to a project of the <br/>
<a id="pl.90.32"></a><var>90.32</var>public utilities commissions of the cities of Hibbing and Virginia to convert their electrical <br/>
<a id="pl.90.33"></a><var>90.33</var>generating plants to the use of biomass products, such as wood.<br/>
<a id="pl.91.1"></a><var>91.1</var>    (d) Distributions received in calendar year 2007 must be paid to the city of Tower to <br/>
<a id="pl.91.2"></a><var>91.2</var>be used for the East Two Rivers project in or near the city of Tower.<br/>
<a id="pl.91.3"></a><var>91.3</var>    (e) For distributions received in 2008, the first $2,000,000 of the 2008 distribution <br/>
<a id="pl.91.4"></a><var>91.4</var>must be paid to St. Louis County for deposit in its county road and bridge fund to be <br/>
<a id="pl.91.5"></a><var>91.5</var>used for relocation of St. Louis County Road 715, commonly referred to as Pike River <br/>
<a id="pl.91.6"></a><var>91.6</var>Road. The remainder of the 2008 distribution and the full amount of the distributions <br/>
<a id="pl.91.7"></a><var>91.7</var>must be paid to St. Louis County for a grant to the city of Virginia for connecting sewer <br/>
<a id="pl.91.8"></a><var>91.8</var>and water lines to the St. Louis County maintenance garage on Highway 135, further <br/>
<a id="pl.91.9"></a><var>91.9</var>extending the lines to interconnect with the city of Gilbert's sewer and water lines. All <br/>
<a id="pl.91.10"></a><var>91.10</var>distributions received in 2009 and subsequent years is are allocated for projects under <br/>
<a id="pl.91.11"></a><var>91.11</var>section 
         <statute_ref>298.223</statute_ref>, subdivision 1.<br/>
<a id="pl.91.12"></a><var>91.12</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.8.14.0"></a><a id="pl.91.13"></a><var>91.13</var>    Sec. 14. Minnesota Statutes 2006, section 298.2961, subdivision 5, is amended to read:<br/>
<a id="pl.91.14"></a><var>91.14</var>    Subd. 5. <b>Public works and local economic development fund.</b> For distributions in <br/>
<a id="pl.91.15"></a><var>91.15</var>2007 only, a special fund is established to receive 
         <statute_ref>38.4</statute_ref> cents per ton that otherwise would <br/>
<a id="pl.91.16"></a><var>91.16</var>be allocated under section 
         <statute_ref>298.28</statute_ref>, subdivision 6. The following amounts are allocated to <br/>
<a id="pl.91.17"></a><var>91.17</var>St. Louis County acting as the fiscal agent for the recipients for the specific purposes:<br/>
<a id="pl.91.18"></a><var>91.18</var>    (1) 
         <statute_ref>13.4</statute_ref> cents per ton for the Central Iron Range Sanitary Sewer District for <br/>
<a id="pl.91.19"></a><var>91.19</var>construction of a combined wastewater facility and notwithstanding section 298.28, <br/>
<a id="pl.91.20"></a><var>91.20</var>subdivision 11, paragraph (a), or any other law, interest accrued on this money while held <br/>
<a id="pl.91.21"></a><var>91.21</var>by St. Louis County shall also be distributed to the recipient;<br/>
<a id="pl.91.22"></a><var>91.22</var>    (2) six cents per ton to the city of Eveleth to redesign and design and construct <br/>
<a id="pl.91.23"></a><var>91.23</var>improvements to renovate its water treatment facility;<br/>
<a id="pl.91.24"></a><var>91.24</var>    (3) one cent per ton for the East Range Joint Powers Board to acquire land for and to <br/>
<a id="pl.91.25"></a><var>91.25</var>design a central wastewater collection and treatment system;<br/>
<a id="pl.91.26"></a><var>91.26</var>    (4) 0.5 cents per ton to the city of Hoyt Lakes to repair Leeds Road;<br/>
<a id="pl.91.27"></a><var>91.27</var>    (5) 0.7 cents per ton to the city of Virginia to extend Eighth Street South;<br/>
<a id="pl.91.28"></a><var>91.28</var>    (6) 0.7 cents per ton to the city of Mountain Iron to repair Hoover Road;<br/>
<a id="pl.91.29"></a><var>91.29</var>    (7) 0.9 cents per ton to the city of Gilbert for alley repairs between Michigan and <br/>
<a id="pl.91.30"></a><var>91.30</var>Indiana Avenues and for repayment of a loan to the Minnesota Department of Employment <br/>
<a id="pl.91.31"></a><var>91.31</var>and Economic Development;<br/>
<a id="pl.91.32"></a><var>91.32</var>    (8) 0.4 cents per ton to the city of Keewatin for a new city well;<br/>
<a id="pl.91.33"></a><var>91.33</var>    (9) 0.3 cents per ton to the city of Grand Rapids for planning for a fire and hazardous <br/>
<a id="pl.91.34"></a><var>91.34</var>materials center;<br/>
<a id="pl.92.1"></a><var>92.1</var>    (10) 0.9 cents per ton to Aitkin County Growth for an economic development <br/>
<a id="pl.92.2"></a><var>92.2</var>project for peat harvesting;<br/>
<a id="pl.92.3"></a><var>92.3</var>    (11) 0.4 cents per ton to the city of Nashwauk to develop a comprehensive city plan;<br/>
<a id="pl.92.4"></a><var>92.4</var>    (12) 0.4 cents per ton to the city of Taconite for development of a city comprehensive <br/>
<a id="pl.92.5"></a><var>92.5</var>plan;<br/>
<a id="pl.92.6"></a><var>92.6</var>    (13) 0.3 cents per ton to the city of Marble for water and sewer infrastructure;<br/>
<a id="pl.92.7"></a><var>92.7</var>    (14) 0.8 cents per ton to Aitkin County for improvements to the Long Lake <br/>
<a id="pl.92.8"></a><var>92.8</var>Environmental Learning Center; <br/>
<a id="pl.92.9"></a><var>92.9</var>    (15) 0.3 cents per ton to the city of Coleraine for the Coleraine Technology Center;<br/>
<a id="pl.92.10"></a><var>92.10</var>    (16) 0.5 cents per ton to the Economic Development Authority of the city of Grand <br/>
<a id="pl.92.11"></a><var>92.11</var>Rapids for planning for the North Central Research and Technology Laboratory;<br/>
<a id="pl.92.12"></a><var>92.12</var>    (17) 0.6 cents per ton to the city of Bovey for sewer and water extension;<br/>
<a id="pl.92.13"></a><var>92.13</var>    (18) 0.3 cents per ton to the city of Calumet for infrastructure improvements; and<br/>
<a id="pl.92.14"></a><var>92.14</var>    (19) ten cents per ton to an economic development authority in a city through which <br/>
<a id="pl.92.15"></a><var>92.15</var>State Highway 1 passes, or a city in Independent School District No. 2142 that has an <br/>
<a id="pl.92.16"></a><var>92.16</var>active mine, the commissioner of Iron Range Resources and Rehabilitation for deposit <br/>
<a id="pl.92.17"></a><var>92.17</var>in a Highway 1 Corridor Account established by the commissioner, to be distributed by <br/>
<a id="pl.92.18"></a><var>92.18</var>the commissioner to any of the cities of Babbitt, Cook, Ely, or Tower,  for an economic <br/>
<a id="pl.92.19"></a><var>92.19</var>development project projects approved by the Iron Range Resources and Rehabilitation <br/>
<a id="pl.92.20"></a><var>92.20</var>Board; notwithstanding section 298.28, subdivision 11, paragraph (a), or any other law, <br/>
<a id="pl.92.21"></a><var>92.21</var>interest accrued on this money while held by St. Louis County or the commissioner <br/>
<a id="pl.92.22"></a><var>92.22</var>shall also be distributed to the recipient.<br/>
<a id="pl.92.23"></a><var>92.23</var><b>EFFECTIVE DATE.</b>This section is effective for distributions made in 2008 and <br/>
<a id="pl.92.24"></a><var>92.24</var>thereafter.<br/>
<br/>
<a id="bill.8.15.0"></a><a id="pl.92.25"></a><var>92.25</var>    Sec. 15. Minnesota Statutes 2006, section 298.75, subdivision 1, is amended to read:<br/>
<a id="pl.92.26"></a><var>92.26</var>    Subdivision 1. <b>Definitions.</b> Except as may otherwise be provided, the following <br/>
<a id="pl.92.27"></a><var>92.27</var>words, when used in this section, shall have the meanings herein ascribed to them.<br/>
<a id="pl.92.28"></a><var>92.28</var>    (1)  (a) "Aggregate material" shall mean means:<br/>
<a id="pl.92.29"></a><var>92.29</var>    (1)  nonmetallic natural mineral aggregate including, but not limited to sand, silica <br/>
<a id="pl.92.30"></a><var>92.30</var>sand, gravel, crushed rock, limestone, granite, and borrow, but only if the borrow is <br/>
<a id="pl.92.31"></a><var>92.31</var>transported on a public road, street, or highway., provided that nonmetallic aggregate <br/>
<a id="pl.92.32"></a><var>92.32</var>material shall does not include dimension stone and dimension granite; and <br/>
<a id="pl.92.33"></a><var>92.33</var>    (2) taconite tailings, crushed rock, and architectural or dimension stone and <br/>
<a id="pl.92.34"></a><var>92.34</var>dimension granite removed from a taconite mine or the site of a previously operated <br/>
<a id="pl.92.35"></a><var>92.35</var>taconite mine. <br/>
<a id="pl.93.1"></a><var>93.1</var>    Aggregate material must be measured or weighed after it has been extracted from <br/>
<a id="pl.93.2"></a><var>93.2</var>the pit, quarry, or deposit.<br/>
<a id="pl.93.3"></a><var>93.3</var>    (2) (b)  "Person" shall mean means any individual, firm, partnership, corporation, <br/>
<a id="pl.93.4"></a><var>93.4</var>organization, trustee, association, or other entity.<br/>
<a id="pl.93.5"></a><var>93.5</var>    (3)  (c) "Operator" shall mean means any person engaged in the business of removing <br/>
<a id="pl.93.6"></a><var>93.6</var>aggregate material from the surface or subsurface of the soil, for the purpose of sale, <br/>
<a id="pl.93.7"></a><var>93.7</var>either directly or indirectly, through the use of the aggregate material in a marketable <br/>
<a id="pl.93.8"></a><var>93.8</var>product or service.<br/>
<a id="pl.93.9"></a><var>93.9</var>    (4) (d) "Extraction site" shall mean means a pit, quarry, or deposit containing <br/>
<a id="pl.93.10"></a><var>93.10</var>aggregate material and any contiguous property to the pit, quarry, or deposit which is used <br/>
<a id="pl.93.11"></a><var>93.11</var>by the operator for stockpiling the aggregate material.<br/>
<a id="pl.93.12"></a><var>93.12</var>    (5)  (e) "Importer" shall mean means any person who buys aggregate material <br/>
<a id="pl.93.13"></a><var>93.13</var>produced from a county not listed in paragraph (6)  (f) or another state and causes the <br/>
<a id="pl.93.14"></a><var>93.14</var>aggregate material to be imported into a county in this state which imposes a tax on <br/>
<a id="pl.93.15"></a><var>93.15</var>aggregate material.<br/>
<a id="pl.93.16"></a><var>93.16</var>    (6)  (f) "County" shall mean means the counties of Pope, Stearns, Benton, Sherburne, <br/>
<a id="pl.93.17"></a><var>93.17</var>Carver, Scott, Dakota, Le Sueur, Kittson, Marshall, Pennington, Red Lake, Polk, Norman, <br/>
<a id="pl.93.18"></a><var>93.18</var>Mahnomen, Clay, Becker, Carlton, St. Louis, Rock, Murray, Wilkin, Big Stone, Sibley, <br/>
<a id="pl.93.19"></a><var>93.19</var>Hennepin, Washington, Chisago, and Ramsey. County also means any other county whose <br/>
<a id="pl.93.20"></a><var>93.20</var>board has voted after a public hearing to impose the tax under this section and has notified <br/>
<a id="pl.93.21"></a><var>93.21</var>the commissioner of revenue of the imposition of the tax.<br/>
<a id="pl.93.22"></a><var>93.22</var>    (7) (g) "Borrow" shall mean means granular borrow, consisting of durable particles <br/>
<a id="pl.93.23"></a><var>93.23</var>of gravel and sand, crushed quarry or mine rock, crushed gravel or stone, or any <br/>
<a id="pl.93.24"></a><var>93.24</var>combination thereof, the ratio of the portion passing the (#200) sieve divided by the <br/>
<a id="pl.93.25"></a><var>93.25</var>portion passing the (1 inch) sieve may not exceed 20 percent by mass.<br/>
<a id="pl.93.26"></a><var>93.26</var><b>EFFECTIVE DATE.</b>This section is effective for aggregate material removed <br/>
<a id="pl.93.27"></a><var>93.27</var>beginning June 1, 2008.<br/>
<br/>
<a id="bill.8.16.0"></a><a id="pl.93.28"></a><var>93.28</var>    Sec. 16. Minnesota Statutes 2006, section 298.75, subdivision 3, is amended to read:<br/>
<a id="pl.93.29"></a><var>93.29</var>    Subd. 3. <b>Report and remittance.</b> (a) By the 14th day following the last day of each <br/>
<a id="pl.93.30"></a><var>93.30</var>calendar quarter, every operator or importer shall make and file with the county auditor of <br/>
<a id="pl.93.31"></a><var>93.31</var>the county in which the aggregate material is removed or imported, a correct report under <br/>
<a id="pl.93.32"></a><var>93.32</var>oath, in such form and containing such information as the auditor shall require relative to <br/>
<a id="pl.93.33"></a><var>93.33</var>the quantity of aggregate material removed or imported during the preceding calendar <br/>
<a id="pl.93.34"></a><var>93.34</var>quarter. The report shall be accompanied by a remittance of the amount of tax due.<br/>
<a id="pl.94.1"></a><var>94.1</var>    (b) If any of the proceeds of the tax is to be apportioned as provided in subdivision <br/>
<a id="pl.94.2"></a><var>94.2</var>2, the operator or importer shall also include on the report any relevant information <br/>
<a id="pl.94.3"></a><var>94.3</var>concerning the amount of aggregate material transported, the tax and the county of <br/>
<a id="pl.94.4"></a><var>94.4</var>destination. The county auditor shall notify the county treasurer of the amount of such <br/>
<a id="pl.94.5"></a><var>94.5</var>tax and the county to which it is due. The county treasurer shall remit the tax to the <br/>
<a id="pl.94.6"></a><var>94.6</var>appropriate county within 30 days, except as provided in paragraph (c).<br/>
<a id="pl.94.7"></a><var>94.7</var>    (c) The proceeds of the tax on aggregate material as defined in subdivision 1, <br/>
<a id="pl.94.8"></a><var>94.8</var>paragraph (a), clause (2), must be remitted to the commissioner of iron range resources <br/>
<a id="pl.94.9"></a><var>94.9</var>and rehabilitation to be deposited in the taconite area environmental protection fund under <br/>
<a id="pl.94.10"></a><var>94.10</var>section 298.223, and used for the purposes of that fund.<br/>
<a id="pl.94.11"></a><var>94.11</var><b>EFFECTIVE DATE.</b>This section is effective for aggregate material removed <br/>
<a id="pl.94.12"></a><var>94.12</var>beginning June 1, 2008.<br/>
<br/>
<a id="bill.8.17.0"></a><a id="pl.94.13"></a><var>94.13</var>    Sec. 17. Minnesota Statutes 2006, section 298.75, subdivision 7, is amended to read:<br/>
<a id="pl.94.14"></a><var>94.14</var>    Subd. 7. <b>Proceeds of taxes.</b> All money collected as taxes under this section on <br/>
<a id="pl.94.15"></a><var>94.15</var>aggregate material as defined in subdivision 1, paragraph (a), clause (1), shall be deposited <br/>
<a id="pl.94.16"></a><var>94.16</var>in the county treasury and credited as follows, for expenditure by the county board:<br/>
<a id="pl.94.17"></a><var>94.17</var>    (a) Sixty percent to the county road and bridge fund for expenditure for the <br/>
<a id="pl.94.18"></a><var>94.18</var>maintenance, construction and reconstruction of roads, highways and bridges;<br/>
<a id="pl.94.19"></a><var>94.19</var>    (b) Thirty percent to the road and bridge fund of those towns as determined by the <br/>
<a id="pl.94.20"></a><var>94.20</var>county board and to the general fund or other designated fund of those cities as determined <br/>
<a id="pl.94.21"></a><var>94.21</var>by the county board, to be expended for maintenance, construction and reconstruction of <br/>
<a id="pl.94.22"></a><var>94.22</var>roads, highways and bridges; and<br/>
<a id="pl.94.23"></a><var>94.23</var>    (c) Ten percent to a special reserve fund which is hereby established, for expenditure <br/>
<a id="pl.94.24"></a><var>94.24</var>for the restoration of abandoned pits, quarries, or deposits located upon public and tax <br/>
<a id="pl.94.25"></a><var>94.25</var>forfeited lands within the county.<br/>
<a id="pl.94.26"></a><var>94.26</var>    If there are no abandoned pits, quarries or deposits located upon public or tax <br/>
<a id="pl.94.27"></a><var>94.27</var>forfeited lands within the county, this portion of the tax shall be deposited in the county <br/>
<a id="pl.94.28"></a><var>94.28</var>road and bridge fund for expenditure for the maintenance, construction and reconstruction <br/>
<a id="pl.94.29"></a><var>94.29</var>of roads, highways and bridges.<br/>
<a id="pl.94.30"></a><var>94.30</var><b>EFFECTIVE DATE.</b>This section is effective for aggregate material removed <br/>
<a id="pl.94.31"></a><var>94.31</var>beginning June 1, 2008.<br/>
<br/>
<a id="bill.8.18.0"></a><a id="pl.94.32"></a><var>94.32</var>    Sec. 18. <b>IRON RANGE RESOURCES AND REHABILITATION BOARD; </b><br/>
<a id="pl.94.33"></a><var>94.33</var><b>APPROPRIATION; RETIRE BONDS.</b><br/>
<a id="pl.95.1"></a><var>95.1</var>    Commencing with taxes payable in 2008 there is annually appropriated from <br/>
<a id="pl.95.2"></a><var>95.2</var>the distribution of the taconite production tax revenues to the taconite environmental <br/>
<a id="pl.95.3"></a><var>95.3</var>protection fund under Minnesota Statutes, section 298.28, subdivision 11, and to the <br/>
<a id="pl.95.4"></a><var>95.4</var>Douglas J. Johnson economic protection trust fund under Minnesota Statutes, section <br/>
<a id="pl.95.5"></a><var>95.5</var>298.28, subdivisions 9 and 11, in equal shares, an amount of $500,000 per year.<br/>
<a id="pl.95.6"></a><var>95.6</var>    The revenue received under this section shall be used only to retire Mesabi East <br/>
<a id="pl.95.7"></a><var>95.7</var>School District No. 2711 bonds in the amount of $9,000,000 issued September 1, 2006, <br/>
<a id="pl.95.8"></a><var>95.8</var>and in the amount of $6,250,000 issued March 1, 2007. The payments shall continue <br/>
<a id="pl.95.9"></a><var>95.9</var>for a period of ten years ending with taxes payable in 2017. Payments to the school <br/>
<a id="pl.95.10"></a><var>95.10</var>district shall be made annually on March 1, except that the initial annual payment shall <br/>
<a id="pl.95.11"></a><var>95.11</var>be made by September 1, 2008.<br/>
<a id="pl.95.12"></a><var>95.12</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.9.0.0"></a>

<a id="bill.9.1.0"></a><a id="pl.95.15"></a><var>95.15</var>    Section 1. Minnesota Statutes 2006, section 469.169, is amended by adding a <br/>
<a id="pl.95.16"></a><var>95.16</var>subdivision to read:<br/>
<a id="pl.95.17"></a><var>95.17</var>    Subd. 18. <b>Additional border city allocations; 2008.</b> (a) In addition to tax <br/>
<a id="pl.95.18"></a><var>95.18</var>reductions authorized in subdivisions 7 to 17, the commissioner shall allocate $352,500 <br/>
<a id="pl.95.19"></a><var>95.19</var>for tax reductions to border city enterprise zones in cities located on the western border <br/>
<a id="pl.95.20"></a><var>95.20</var>of the state. The commissioner shall make allocations to zones in cities on the western <br/>
<a id="pl.95.21"></a><var>95.21</var>border on a per capita basis. Allocations made under this subdivision may be used for <br/>
<a id="pl.95.22"></a><var>95.22</var>tax reductions as provided in section 469.171, or for other offsets of taxes imposed on <br/>
<a id="pl.95.23"></a><var>95.23</var>or remitted by businesses located in the enterprise zone, but only if the municipality <br/>
<a id="pl.95.24"></a><var>95.24</var>determines that the granting of the tax reduction or offset is necessary in order to retain a <br/>
<a id="pl.95.25"></a><var>95.25</var>business within or attract a business to the zone. The city alternatively may elect to use <br/>
<a id="pl.95.26"></a><var>95.26</var>any portion of the allocation provided in this paragraph for tax reductions under section <br/>
<a id="pl.95.27"></a><var>95.27</var>469.1732 or 469.1734.<br/>
<a id="pl.95.28"></a><var>95.28</var>    (b) The commissioner shall allocate $352,500 for tax reductions under section <br/>
<a id="pl.95.29"></a><var>95.29</var>469.1732 or 469.1734 to cities with border city enterprise zones located on the western <br/>
<a id="pl.95.30"></a><var>95.30</var>border of the state. The commissioner shall allocate this amount among the cities on a per <br/>
<a id="pl.95.31"></a><var>95.31</var>capita basis. The city alternatively may elect to use any portion of the allocation provided <br/>
<a id="pl.95.32"></a><var>95.32</var>in this paragraph for tax reductions as provided in section 469.171.<br/>
<a id="pl.95.33"></a><var>95.33</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.9.2.0"></a><a id="pl.96.1"></a><var>96.1</var>    Sec. 2. Minnesota Statutes 2006, section 469.174, subdivision 10, is amended to read:<br/>
<a id="pl.96.2"></a><var>96.2</var>    Subd. 10. <b>Redevelopment district.</b> (a) "Redevelopment district" means a type of <br/>
<a id="pl.96.3"></a><var>96.3</var>tax increment financing district consisting of a project, or portions of a project, within <br/>
<a id="pl.96.4"></a><var>96.4</var>which the authority finds by resolution that one or more of the following conditions, <br/>
<a id="pl.96.5"></a><var>96.5</var>reasonably distributed throughout the district, exists:<br/>
<a id="pl.96.6"></a><var>96.6</var>    (1) parcels consisting of 70 percent of the area of the district are occupied by <br/>
<a id="pl.96.7"></a><var>96.7</var>buildings, streets, utilities, paved or gravel parking lots, or other similar structures <br/>
<a id="pl.96.8"></a><var>96.8</var>and more than 50 percent of the buildings, not including outbuildings, are structurally <br/>
<a id="pl.96.9"></a><var>96.9</var>substandard to a degree requiring substantial renovation or clearance;<br/>
<a id="pl.96.10"></a><var>96.10</var>    (2) the property consists of vacant, unused, underused, inappropriately used, <br/>
<a id="pl.96.11"></a><var>96.11</var>or infrequently used railyards, rail storage facilities, or excessive or vacated railroad <br/>
<a id="pl.96.12"></a><var>96.12</var>rights-of-way;<br/>
<a id="pl.96.13"></a><var>96.13</var>    (3) tank facilities, or property whose immediately previous use was for tank <br/>
<a id="pl.96.14"></a><var>96.14</var>facilities, as defined in section 
         <statute_ref>115C.02, subdivision 15</statute_ref>, if the tank facilities: <br/>
<a id="pl.96.15"></a><var>96.15</var>    (i) have or had a capacity of more than 1,000,000 gallons;<br/>
<a id="pl.96.16"></a><var>96.16</var>    (ii) are located adjacent to rail facilities; and<br/>
<a id="pl.96.17"></a><var>96.17</var>    (iii) have been removed or are unused, underused, inappropriately used, or <br/>
<a id="pl.96.18"></a><var>96.18</var>infrequently used; or<br/>
<a id="pl.96.19"></a><var>96.19</var>    (4) a qualifying disaster area, as defined in subdivision 10b.<br/>
<a id="pl.96.20"></a><var>96.20</var>    (b) For purposes of this subdivision, "structurally substandard" shall mean <br/>
<a id="pl.96.21"></a><var>96.21</var>containing defects in structural elements or a combination of deficiencies in essential <br/>
<a id="pl.96.22"></a><var>96.22</var>utilities and facilities, light and ventilation, fire protection including adequate egress, <br/>
<a id="pl.96.23"></a><var>96.23</var>layout and condition of interior partitions, or similar factors, which defects or deficiencies <br/>
<a id="pl.96.24"></a><var>96.24</var>are of sufficient total significance to justify substantial renovation or clearance.<br/>
<a id="pl.96.25"></a><var>96.25</var>    (c) A building is not structurally substandard if it is in compliance with the building <br/>
<a id="pl.96.26"></a><var>96.26</var>code applicable to new buildings or could be modified to satisfy the building code at <br/>
<a id="pl.96.27"></a><var>96.27</var>a cost of less than 15 percent of the cost of constructing a new structure of the same <br/>
<a id="pl.96.28"></a><var>96.28</var>square footage and type on the site. The municipality may find that a building is not <br/>
<a id="pl.96.29"></a><var>96.29</var>disqualified as structurally substandard under the preceding sentence on the basis of <br/>
<a id="pl.96.30"></a><var>96.30</var>reasonably available evidence, such as the size, type, and age of the building, the average <br/>
<a id="pl.96.31"></a><var>96.31</var>cost of plumbing, electrical, or structural repairs, or other similar reliable evidence. The <br/>
<a id="pl.96.32"></a><var>96.32</var>municipality may not make such a determination without an interior inspection of the <br/>
<a id="pl.96.33"></a><var>96.33</var>property, but need not have an independent, expert appraisal prepared of the cost of repair <br/>
<a id="pl.96.34"></a><var>96.34</var>and rehabilitation of the building. An interior inspection of the property is not required, <br/>
<a id="pl.96.35"></a><var>96.35</var>if the municipality finds that (1) the municipality or authority is unable to gain access to <br/>
<a id="pl.96.36"></a><var>96.36</var>the property after using its best efforts to obtain permission from the party that owns or <br/>
<a id="pl.97.1"></a><var>97.1</var>controls the property; and (2) the evidence otherwise supports a reasonable conclusion that <br/>
<a id="pl.97.2"></a><var>97.2</var>the building is structurally substandard. Items of evidence that support such a conclusion <br/>
<a id="pl.97.3"></a><var>97.3</var>include recent fire or police inspections, on-site property tax appraisals or housing <br/>
<a id="pl.97.4"></a><var>97.4</var>inspections, exterior evidence of deterioration, or other similar reliable evidence. Written <br/>
<a id="pl.97.5"></a><var>97.5</var>documentation of the findings and reasons why an interior inspection was not conducted <br/>
<a id="pl.97.6"></a><var>97.6</var>must be made and retained under section 
         <statute_ref>469.175, subdivision 3</statute_ref>, clause (1). Failure of a <br/>
<a id="pl.97.7"></a><var>97.7</var>building to be disqualified under the provisions of this paragraph is a necessary, but not a <br/>
<a id="pl.97.8"></a><var>97.8</var>sufficient, condition to determining that the building is substandard. <br/>
<a id="pl.97.9"></a><var>97.9</var>    (d) A parcel is deemed to be occupied by a structurally substandard building <br/>
<a id="pl.97.10"></a><var>97.10</var>for purposes of the finding under paragraph (a) or by the improvements described in <br/>
<a id="pl.97.11"></a><var>97.11</var>paragraph (e) if all of the following conditions are met:<br/>
<a id="pl.97.12"></a><var>97.12</var>    (1) the parcel was occupied by a substandard building or met the requirements <br/>
<a id="pl.97.13"></a><var>97.13</var>of paragraph (e), as the case may be, within three years of the filing of the request for <br/>
<a id="pl.97.14"></a><var>97.14</var>certification of the parcel as part of the district with the county auditor;<br/>
<a id="pl.97.15"></a><var>97.15</var>    (2) the substandard building was or the improvements described in paragraph (e) <br/>
<a id="pl.97.16"></a><var>97.16</var>were demolished or removed by the authority or the demolition or removal was financed <br/>
<a id="pl.97.17"></a><var>97.17</var>by the authority or was done by a developer under a development agreement with the <br/>
<a id="pl.97.18"></a><var>97.18</var>authority;<br/>
<a id="pl.97.19"></a><var>97.19</var>    (3) the authority found by resolution before the demolition or removal that the <br/>
<a id="pl.97.20"></a><var>97.20</var>parcel was occupied by a structurally substandard building or met the requirements of <br/>
<a id="pl.97.21"></a><var>97.21</var>paragraph (e) and that after demolition and clearance the authority intended to include <br/>
<a id="pl.97.22"></a><var>97.22</var>the parcel within a district; and<br/>
<a id="pl.97.23"></a><var>97.23</var>    (4) upon filing the request for certification of the tax capacity of the parcel as part <br/>
<a id="pl.97.24"></a><var>97.24</var>of a district, the authority notifies the county auditor that the original tax capacity of the <br/>
<a id="pl.97.25"></a><var>97.25</var>parcel must be adjusted as provided by section 
         <statute_ref>469.177, subdivision 1</statute_ref>, paragraph (f). <br/>
<a id="pl.97.26"></a><var>97.26</var>    (e) For purposes of this subdivision, a parcel is not occupied by buildings, streets, <br/>
<a id="pl.97.27"></a><var>97.27</var>utilities, paved or gravel parking lots, or other similar structures unless 15 percent of the <br/>
<a id="pl.97.28"></a><var>97.28</var>area of the parcel contains buildings, streets, utilities, paved or gravel parking lots, or <br/>
<a id="pl.97.29"></a><var>97.29</var>other similar structures.<br/>
<a id="pl.97.30"></a><var>97.30</var>    (f) For districts consisting of two or more noncontiguous areas, each area must <br/>
<a id="pl.97.31"></a><var>97.31</var>qualify as a redevelopment district under paragraph (a) to be included in the district, and <br/>
<a id="pl.97.32"></a><var>97.32</var>the entire area of the district must satisfy paragraph (a).<br/>
<a id="pl.97.33"></a><var>97.33</var><b>EFFECTIVE DATE.</b>This section is effective for requests for certification made <br/>
<a id="pl.97.34"></a><var>97.34</var>after June 30, 2008.<br/>
<br/>
<a id="bill.9.3.0"></a><a id="pl.97.35"></a><var>97.35</var>    Sec. 3. Minnesota Statutes 2006, section 469.174, subdivision 10a, is amended to read:<br/>
<a id="pl.98.1"></a><var>98.1</var>    Subd. 10a. <b>Renewal and renovation district.</b> (a) "Renewal and renovation district" <br/>
<a id="pl.98.2"></a><var>98.2</var>means a type of tax increment financing district consisting of a project, or portions of a <br/>
<a id="pl.98.3"></a><var>98.3</var>project, within which the authority finds by resolution that:<br/>
<a id="pl.98.4"></a><var>98.4</var>    (1)(i) parcels consisting of 70 percent of the area of the district are occupied by <br/>
<a id="pl.98.5"></a><var>98.5</var>buildings, streets, utilities, paved or gravel parking lots, or other similar structures; (ii) <br/>
<a id="pl.98.6"></a><var>98.6</var>20 percent of the buildings are structurally substandard; and (iii) 30 percent of the other <br/>
<a id="pl.98.7"></a><var>98.7</var>buildings require substantial renovation or clearance to remove existing conditions such <br/>
<a id="pl.98.8"></a><var>98.8</var>as: inadequate street layout, incompatible uses or land use relationships, overcrowding of <br/>
<a id="pl.98.9"></a><var>98.9</var>buildings on the land, excessive dwelling unit density, obsolete buildings not suitable for <br/>
<a id="pl.98.10"></a><var>98.10</var>improvement or conversion, or other identified hazards to the health, safety, and general <br/>
<a id="pl.98.11"></a><var>98.11</var>well-being of the community; and<br/>
<a id="pl.98.12"></a><var>98.12</var>    (2) the conditions described in clause (1) are reasonably distributed throughout the <br/>
<a id="pl.98.13"></a><var>98.13</var>geographic area of the district.<br/>
<a id="pl.98.14"></a><var>98.14</var>    (b) For purposes of determining whether a building is structurally substandard, <br/>
<a id="pl.98.15"></a><var>98.15</var>whether parcels are occupied by buildings, streets, utilities, paved or gravel parking lots, <br/>
<a id="pl.98.16"></a><var>98.16</var>or other similar structures, or whether noncontiguous areas qualify, the provisions of <br/>
<a id="pl.98.17"></a><var>98.17</var>subdivision 10, paragraphs (c), (e), and (b) through (f) apply.<br/>
<a id="pl.98.18"></a><var>98.18</var><b>EFFECTIVE DATE.</b>This section is effective for requests for certification made <br/>
<a id="pl.98.19"></a><var>98.19</var>after June 30, 2008.<br/>
<br/>
<a id="bill.9.4.0"></a><a id="pl.98.20"></a><var>98.20</var>    Sec. 4. Minnesota Statutes 2006, section 469.175, subdivision 1, is amended to read:<br/>
<a id="pl.98.21"></a><var>98.21</var>    Subdivision 1. <b>Tax increment financing plan.</b> (a) A tax increment financing plan <br/>
<a id="pl.98.22"></a><var>98.22</var>shall contain:<br/>
<a id="pl.98.23"></a><var>98.23</var>    (1) a statement of objectives of an authority for the improvement of a project;<br/>
<a id="pl.98.24"></a><var>98.24</var>    (2) a statement as to the development program for the project, including the property <br/>
<a id="pl.98.25"></a><var>98.25</var>within the project, if any, that the authority intends to acquire, identified by parcel number, <br/>
<a id="pl.98.26"></a><var>98.26</var>identifiable property name, block, or other appropriate means indicating the area in which <br/>
<a id="pl.98.27"></a><var>98.27</var>the authority intends to acquire properties;<br/>
<a id="pl.98.28"></a><var>98.28</var>    (3) a list of any development activities that the plan proposes to take place within <br/>
<a id="pl.98.29"></a><var>98.29</var>the project, for which contracts have been entered into at the time of the preparation of <br/>
<a id="pl.98.30"></a><var>98.30</var>the plan, including the names of the parties to the contract, the activity governed by the <br/>
<a id="pl.98.31"></a><var>98.31</var>contract, the cost stated in the contract, and the expected date of completion of that activity;<br/>
<a id="pl.98.32"></a><var>98.32</var>    (4) identification or description of the type of any other specific development <br/>
<a id="pl.98.33"></a><var>98.33</var>reasonably expected to take place within the project, and the date when the development is <br/>
<a id="pl.98.34"></a><var>98.34</var>likely to occur;<br/>
<a id="pl.98.35"></a><var>98.35</var>    (5) estimates of the following:<br/>
<a id="pl.99.1"></a><var>99.1</var>    (i) cost of the project, including administrative expenses, except that if part of the <br/>
<a id="pl.99.2"></a><var>99.2</var>cost of the project is paid or financed with increment from the tax increment financing <br/>
<a id="pl.99.3"></a><var>99.3</var>district, the tax increment financing plan for the district must contain an estimate of the <br/>
<a id="pl.99.4"></a><var>99.4</var>amount of the cost of the project, including administrative expenses, that will be paid or <br/>
<a id="pl.99.5"></a><var>99.5</var>financed with tax increments from the district;<br/>
<a id="pl.99.6"></a><var>99.6</var>    (ii) amount of bonded indebtedness to be incurred;<br/>
<a id="pl.99.7"></a><var>99.7</var>    (iii) sources of revenue to finance or otherwise pay public costs;<br/>
<a id="pl.99.8"></a><var>99.8</var>    (iv) the most recent net tax capacity of taxable real property within the tax increment <br/>
<a id="pl.99.9"></a><var>99.9</var>financing district and within any subdistrict;<br/>
<a id="pl.99.10"></a><var>99.10</var>    (v) the estimated captured net tax capacity of the tax increment financing district <br/>
<a id="pl.99.11"></a><var>99.11</var>at completion; and<br/>
<a id="pl.99.12"></a><var>99.12</var>    (vi) the duration of the tax increment financing district's and any subdistrict's <br/>
<a id="pl.99.13"></a><var>99.13</var>existence;<br/>
<a id="pl.99.14"></a><var>99.14</var>    (6) statements of the authority's alternate estimates of the impact of tax increment <br/>
<a id="pl.99.15"></a><var>99.15</var>financing on the net tax capacities of all taxing jurisdictions in which the tax increment <br/>
<a id="pl.99.16"></a><var>99.16</var>financing district is located in whole or in part. For purposes of one statement, the <br/>
<a id="pl.99.17"></a><var>99.17</var>authority shall assume that the estimated captured net tax capacity would be available to <br/>
<a id="pl.99.18"></a><var>99.18</var>the taxing jurisdictions without creation of the district, and for purposes of the second <br/>
<a id="pl.99.19"></a><var>99.19</var>statement, the authority shall assume that none of the estimated captured net tax capacity <br/>
<a id="pl.99.20"></a><var>99.20</var>would be available to the taxing jurisdictions without creation of the district or subdistrict;<br/>
<a id="pl.99.21"></a><var>99.21</var>    (7) identification and description of studies and analyses used to make the <br/>
<a id="pl.99.22"></a><var>99.22</var>determination set forth in subdivision 3, clause (2); and<br/>
<a id="pl.99.23"></a><var>99.23</var>    (8) identification of all parcels to be included in the district or any subdistrict.<br/>
<a id="pl.99.24"></a><var>99.24</var>    (b) The authority may specify in the tax increment financing plan the first year in <br/>
<a id="pl.99.25"></a><var>99.25</var>which it elects to receive increment, up to four years following the year of approval of the <br/>
<a id="pl.99.26"></a><var>99.26</var>district. This paragraph does not apply to an economic development district.<br/>
<a id="pl.99.27"></a><var>99.27</var><b>EFFECTIVE DATE.</b>This section is effective for districts for which the request for <br/>
<a id="pl.99.28"></a><var>99.28</var>certification is made after June 30, 2008.<br/>
<br/>
<a id="bill.9.5.0"></a><a id="pl.99.29"></a><var>99.29</var>    Sec. 5. Minnesota Statutes 2006, section 469.175, subdivision 3, is amended to read:<br/>
<a id="pl.99.30"></a><var>99.30</var>    Subd. 3. <b>Municipality approval.</b> (a) A county auditor shall not certify the original <br/>
<a id="pl.99.31"></a><var>99.31</var>net tax capacity of a tax increment financing district until the tax increment financing plan <br/>
<a id="pl.99.32"></a><var>99.32</var>proposed for that district has been approved by the municipality in which the district <br/>
<a id="pl.99.33"></a><var>99.33</var>is located. If an authority that proposes to establish a tax increment financing district <br/>
<a id="pl.99.34"></a><var>99.34</var>and the municipality are not the same, the authority shall apply to the municipality in <br/>
<a id="pl.99.35"></a><var>99.35</var>which the district is proposed to be located and shall obtain the approval of its tax <br/>
<a id="pl.100.1"></a><var>100.1</var>increment financing plan by the municipality before the authority may use tax increment <br/>
<a id="pl.100.2"></a><var>100.2</var>financing. The municipality shall approve the tax increment financing plan only after a <br/>
<a id="pl.100.3"></a><var>100.3</var>public hearing thereon after published notice in a newspaper of general circulation in the <br/>
<a id="pl.100.4"></a><var>100.4</var>municipality at least once not less than ten days nor more than 30 days prior to the date <br/>
<a id="pl.100.5"></a><var>100.5</var>of the hearing. The published notice must include a map of the area of the district from <br/>
<a id="pl.100.6"></a><var>100.6</var>which increments may be collected and, if the project area includes additional area, a map <br/>
<a id="pl.100.7"></a><var>100.7</var>of the project area in which the increments may be expended. The hearing may be held <br/>
<a id="pl.100.8"></a><var>100.8</var>before or after the approval or creation of the project or it may be held in conjunction with <br/>
<a id="pl.100.9"></a><var>100.9</var>a hearing to approve the project.<br/>
<a id="pl.100.10"></a><var>100.10</var>    (b) Before or at the time of approval of the tax increment financing plan, the <br/>
<a id="pl.100.11"></a><var>100.11</var>municipality shall make the following findings, and shall set forth in writing the reasons <br/>
<a id="pl.100.12"></a><var>100.12</var>and supporting facts for each determination:<br/>
<a id="pl.100.13"></a><var>100.13</var>    (1) that the proposed tax increment financing district is a redevelopment district, a <br/>
<a id="pl.100.14"></a><var>100.14</var>renewal or renovation district, a housing district, a soils condition district, or an economic <br/>
<a id="pl.100.15"></a><var>100.15</var>development district; if the proposed district is a redevelopment district or a renewal or <br/>
<a id="pl.100.16"></a><var>100.16</var>renovation district, the reasons and supporting facts for the determination that the district <br/>
<a id="pl.100.17"></a><var>100.17</var>meets the criteria of section 
         <statute_ref>469.174, subdivision 10</statute_ref>, paragraph (a), clauses (1) and (2), or <br/>
<a id="pl.100.18"></a><var>100.18</var>subdivision 10a, must be documented in writing and retained and made available to the <br/>
<a id="pl.100.19"></a><var>100.19</var>public by the authority until the district has been terminated; <br/>
<a id="pl.100.20"></a><var>100.20</var>    (2) that, in the opinion of the municipality:<br/>
<a id="pl.100.21"></a><var>100.21</var>    (i) the proposed development or redevelopment would not reasonably be expected to <br/>
<a id="pl.100.22"></a><var>100.22</var>occur solely through private investment within the reasonably foreseeable future; and<br/>
<a id="pl.100.23"></a><var>100.23</var>    (ii) the increased market value of the site that could reasonably be expected to <br/>
<a id="pl.100.24"></a><var>100.24</var>occur without the use of tax increment financing would be less than the increase in the <br/>
<a id="pl.100.25"></a><var>100.25</var>market value estimated to result from the proposed development after subtracting the <br/>
<a id="pl.100.26"></a><var>100.26</var>present value of the projected tax increments for the maximum duration of the district <br/>
<a id="pl.100.27"></a><var>100.27</var>permitted by the plan. The requirements of this item do not apply if the district is a <br/>
<a id="pl.100.28"></a><var>100.28</var>qualified housing district;<br/>
<a id="pl.100.29"></a><var>100.29</var>    (3) that the tax increment financing plan conforms to the general plan for the <br/>
<a id="pl.100.30"></a><var>100.30</var>development or redevelopment of the municipality as a whole;<br/>
<a id="pl.100.31"></a><var>100.31</var>    (4) that the tax increment financing plan will afford maximum opportunity, <br/>
<a id="pl.100.32"></a><var>100.32</var>consistent with the sound needs of the municipality as a whole, for the development or <br/>
<a id="pl.100.33"></a><var>100.33</var>redevelopment of the project by private enterprise;<br/>
<a id="pl.100.34"></a><var>100.34</var>    (5) that the municipality elects the method of tax increment computation set forth in <br/>
<a id="pl.100.35"></a><var>100.35</var>section 
         <statute_ref>469.177, subdivision 3, paragraph (b)</statute_ref>, if applicable. <br/>
<a id="pl.101.1"></a><var>101.1</var>    (c) When the municipality and the authority are not the same, the municipality shall <br/>
<a id="pl.101.2"></a><var>101.2</var>approve or disapprove the tax increment financing plan within 60 days of submission by <br/>
<a id="pl.101.3"></a><var>101.3</var>the authority. When the municipality and the authority are not the same, the municipality <br/>
<a id="pl.101.4"></a><var>101.4</var>may not amend or modify a tax increment financing plan except as proposed by the <br/>
<a id="pl.101.5"></a><var>101.5</var>authority pursuant to subdivision 4. Once approved, the determination of the authority <br/>
<a id="pl.101.6"></a><var>101.6</var>to undertake the project through the use of tax increment financing and the resolution of <br/>
<a id="pl.101.7"></a><var>101.7</var>the governing body shall be conclusive of the findings therein and of the public need for <br/>
<a id="pl.101.8"></a><var>101.8</var>the financing.<br/>
<a id="pl.101.9"></a><var>101.9</var>    (d) For a district that is subject to the requirements of paragraph (b), clause (2), <br/>
<a id="pl.101.10"></a><var>101.10</var>item (ii), the municipality's statement of reasons and supporting facts must include all of <br/>
<a id="pl.101.11"></a><var>101.11</var>the following:<br/>
<a id="pl.101.12"></a><var>101.12</var>    (1) an estimate of the amount by which the market value of the site will increase <br/>
<a id="pl.101.13"></a><var>101.13</var>without the use of tax increment financing;<br/>
<a id="pl.101.14"></a><var>101.14</var>    (2) an estimate of the increase in the market value that will result from the <br/>
<a id="pl.101.15"></a><var>101.15</var>development or redevelopment to be assisted with tax increment financing; and<br/>
<a id="pl.101.16"></a><var>101.16</var>    (3) the present value of the projected tax increments for the maximum duration of <br/>
<a id="pl.101.17"></a><var>101.17</var>the district permitted by the tax increment financing plan.<br/>
<a id="pl.101.18"></a><var>101.18</var>    (e) For purposes of this subdivision, "site" means the parcels on which the <br/>
<a id="pl.101.19"></a><var>101.19</var>development or redevelopment to be assisted with tax increment financing will be located.<br/>
<a id="pl.101.20"></a><var>101.20</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment <br/>
<a id="pl.101.21"></a><var>101.21</var>and applies to all districts, regardless of when the request for certification was made.<br/>
<br/>
<a id="bill.9.6.0"></a><a id="pl.101.22"></a><var>101.22</var>    Sec. 6. Minnesota Statutes 2006, section 469.176, subdivision 1, is amended to read:<br/>
<a id="pl.101.23"></a><var>101.23</var>    Subdivision 1. <b>Duration of tax increment financing districts.</b> (a) Subject to the <br/>
<a id="pl.101.24"></a><var>101.24</var>limitations contained in subdivisions 1a to 1f, any tax increment financing district as to <br/>
<a id="pl.101.25"></a><var>101.25</var>which bonds are outstanding, payment for which the tax increment and other revenues <br/>
<a id="pl.101.26"></a><var>101.26</var>have been pledged, shall remain in existence at least as long as the bonds continue to be <br/>
<a id="pl.101.27"></a><var>101.27</var>outstanding. The municipality may, at the time of approval of the initial tax increment <br/>
<a id="pl.101.28"></a><var>101.28</var>financing plan, provide for one or both of the following:<br/>
<a id="pl.101.29"></a><var>101.29</var>    (1) a shorter maximum duration limit than specified in subdivisions 1a to 1f.; <br/>
<a id="pl.101.30"></a><var>101.30</var>    (2) an election as provided under section 469.175, subdivision 1, paragraph (b).<br/>
<a id="pl.101.31"></a><var>101.31</var>The specified limit applies in place of the otherwise applicable limit, unless the authority <br/>
<a id="pl.101.32"></a><var>101.32</var>modifies the plan following the procedures under section 
         <statute_ref>469.175</statute_ref>, subdivision 4, <br/>
<a id="pl.101.33"></a><var>101.33</var>paragraph (b).<br/>
<a id="pl.102.1"></a><var>102.1</var>    (b) The tax increment pledged to the payment of the bonds and interest thereon may <br/>
<a id="pl.102.2"></a><var>102.2</var>be discharged and the tax increment financing district may be terminated if sufficient funds <br/>
<a id="pl.102.3"></a><var>102.3</var>have been irrevocably deposited in the debt service fund or other escrow account held in <br/>
<a id="pl.102.4"></a><var>102.4</var>trust for all outstanding bonds to provide for the payment of the bonds at maturity or date <br/>
<a id="pl.102.5"></a><var>102.5</var>of redemption and interest thereon to the maturity or redemption date.<br/>
<a id="pl.102.6"></a><var>102.6</var>    (c) For bonds issued pursuant to section 
         <statute_ref>469.178, subdivisions 2 and 3</statute_ref>, the full <br/>
<a id="pl.102.7"></a><var>102.7</var>faith and credit and any taxing powers of the municipality or authority are pledged to the <br/>
<a id="pl.102.8"></a><var>102.8</var>payment of the bonds until the principal of and interest on the bonds has been paid in full. <br/>
<a id="pl.102.9"></a><var>102.9</var><b>EFFECTIVE DATE.</b>This section is effective for districts for which the request for <br/>
<a id="pl.102.10"></a><var>102.10</var>certification is made after June 30, 2008.<br/>
<br/>
<a id="bill.9.7.0"></a><a id="pl.102.11"></a><var>102.11</var>    Sec. 7. Minnesota Statutes 2006, section 469.176, subdivision 2, is amended to read:<br/>
<a id="pl.102.12"></a><var>102.12</var>    Subd. 2. <b>Excess increments.</b> (a) The authority shall annually determine the amount <br/>
<a id="pl.102.13"></a><var>102.13</var>of excess increments for a district, if any. This determination must be based on the tax <br/>
<a id="pl.102.14"></a><var>102.14</var>increment financing plan in effect on December 31 of the year and the increments and <br/>
<a id="pl.102.15"></a><var>102.15</var>other revenues received as of December 31 of the year. The authority must spend or return <br/>
<a id="pl.102.16"></a><var>102.16</var>the excess increments under paragraph (c) within nine months after the end of the year.<br/>
<a id="pl.102.17"></a><var>102.17</var>    (b) For purposes of this subdivision, "excess increments" equals the excess of:<br/>
<a id="pl.102.18"></a><var>102.18</var>    (1) total increments collected from the district since its certification, reduced by any <br/>
<a id="pl.102.19"></a><var>102.19</var>excess increments paid under paragraph (c), clause (4), for a prior year, over<br/>
<a id="pl.102.20"></a><var>102.20</var>    (2) the total costs authorized by the tax increment financing plan to be paid with <br/>
<a id="pl.102.21"></a><var>102.21</var>increments from the district, reduced, but not below zero, by the sum of:<br/>
<a id="pl.102.22"></a><var>102.22</var>    (i) the amounts of those authorized costs that have been paid from sources other than <br/>
<a id="pl.102.23"></a><var>102.23</var>tax increments from the district;<br/>
<a id="pl.102.24"></a><var>102.24</var>    (ii) revenues, other than tax increments from the district, that are dedicated for or <br/>
<a id="pl.102.25"></a><var>102.25</var>otherwise required to be used to pay those authorized costs and that the authority has <br/>
<a id="pl.102.26"></a><var>102.26</var>received and that are not included in item (i);<br/>
<a id="pl.102.27"></a><var>102.27</var>    (iii) the amount of principal and interest obligations due on outstanding bonds after <br/>
<a id="pl.102.28"></a><var>102.28</var>December 31 of the year and not prepaid under paragraph (c) in a prior year; and<br/>
<a id="pl.102.29"></a><var>102.29</var>    (iv) increased by the sum of the transfers of increments made under section 
         <statute_ref>469.1763, <br/>
<a id="pl.102.30"></a><var>102.30</var>subdivision 6
         </statute_ref>, to reduce deficits in other districts made by December 31 of the year.<br/>
<a id="pl.102.31"></a><var>102.31</var>    (c) The authority shall use excess increment only to do one or more of the following:<br/>
<a id="pl.102.32"></a><var>102.32</var>    (1) prepay any outstanding bonds;<br/>
<a id="pl.102.33"></a><var>102.33</var>    (2) discharge the pledge of tax increment for any outstanding bonds;<br/>
<a id="pl.102.34"></a><var>102.34</var>    (3) pay into an escrow account dedicated to the payment of any outstanding bonds; or<br/>
<a id="pl.103.1"></a><var>103.1</var>    (4) return the excess amount to the county auditor who shall distribute the excess <br/>
<a id="pl.103.2"></a><var>103.2</var>amount to the city or town, county, and school district in which the tax increment financing <br/>
<a id="pl.103.3"></a><var>103.3</var>district is located in direct proportion to their respective local tax rates.<br/>
<a id="pl.103.4"></a><var>103.4</var>    (d) For purposes of a district for which the request for certification was made prior to <br/>
<a id="pl.103.5"></a><var>103.5</var>August 1, 1979, excess increments equal the amount of increments on hand on December <br/>
<a id="pl.103.6"></a><var>103.6</var>31, less the principal and interest obligations due on outstanding bonds or advances, <br/>
<a id="pl.103.7"></a><var>103.7</var>qualifying under subdivision 1c, clauses (1), (2), (4), and (5), after December 31 of the <br/>
<a id="pl.103.8"></a><var>103.8</var>year and not prepaid under paragraph (c).<br/>
<a id="pl.103.9"></a><var>103.9</var>    (e) The county auditor must report to the commissioner of education the amount of <br/>
<a id="pl.103.10"></a><var>103.10</var>any excess tax increment distributed to a school district within 30 days of the distribution.<br/>
<a id="pl.103.11"></a><var>103.11</var>    (f) For purposes of this subdivision, "outstanding bonds" means bonds which are <br/>
<a id="pl.103.12"></a><var>103.12</var>secured by increments from the district.<br/>
<a id="pl.103.13"></a><var>103.13</var>    (g) The state auditor may exempt an authority from reporting the amounts calculated <br/>
<a id="pl.103.14"></a><var>103.14</var>under this subdivision for a calendar year, if the authority certifies to the auditor in <br/>
<a id="pl.103.15"></a><var>103.15</var>its report that the total amount authorized by the tax increment plan to be paid with <br/>
<a id="pl.103.16"></a><var>103.16</var>increments from the district exceeds the sum of the total increments collected for the <br/>
<a id="pl.103.17"></a><var>103.17</var>district for all years by 20 percent.<br/>
<a id="pl.103.18"></a><var>103.18</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment and <br/>
<a id="pl.103.19"></a><var>103.19</var>applies to all districts regardless of when the request for certification was made, including <br/>
<a id="pl.103.20"></a><var>103.20</var>districts for which the request for certification was made on or before August 1, 1979.<br/>
<br/>
<a id="bill.9.8.0"></a><a id="pl.103.21"></a><var>103.21</var>    Sec. 8. Minnesota Statutes 2006, section 469.176, subdivision 4l, is amended to read:<br/>
<a id="pl.103.22"></a><var>103.22</var>    Subd. 4l. <b>Prohibited facilities.</b> (a) No tax increment from any district may be <br/>
<a id="pl.103.23"></a><var>103.23</var>used for:<br/>
<a id="pl.103.24"></a><var>103.24</var>    (1) a commons area used as a public park; or<br/>
<a id="pl.103.25"></a><var>103.25</var>    (2) a facility used for social, recreational, or conference purposes.<br/>
<a id="pl.103.26"></a><var>103.26</var>    (b) This subdivision does not apply to a privately owned facility for conference <br/>
<a id="pl.103.27"></a><var>103.27</var>purposes or a parking structure, whether it is public or privately owned or whether it is <br/>
<a id="pl.103.28"></a><var>103.28</var>ancillary to a use listed in paragraph (a).<br/>
<a id="pl.103.29"></a><var>103.29</var><b>EFFECTIVE DATE.</b>This section confirms the original intent of the legislature <br/>
<a id="pl.103.30"></a><var>103.30</var>in enacting Minnesota Statutes, section 469.176, subdivision 4l, and is effective the day <br/>
<a id="pl.103.31"></a><var>103.31</var>following final enactment and applies to any expenditure subject to Minnesota Statutes, <br/>
<a id="pl.103.32"></a><var>103.32</var>section 469.176, subdivision 4l.<br/>
<br/>
<a id="bill.9.9.0"></a><a id="pl.103.33"></a><var>103.33</var>    Sec. 9. Minnesota Statutes 2006, section 469.176, subdivision 7, is amended to read:<br/>
<a id="pl.104.1"></a><var>104.1</var>    Subd. 7. <b>Parcels not includable in districts.</b> (a) The authority may request <br/>
<a id="pl.104.2"></a><var>104.2</var>inclusion in a tax increment financing district and the county auditor may certify the <br/>
<a id="pl.104.3"></a><var>104.3</var>original tax capacity of a parcel or a part of a parcel that qualified under the provisions of <br/>
<a id="pl.104.4"></a><var>104.4</var>section 
         <statute_ref>273.111</statute_ref> or 
         <statute_ref>273.112</statute_ref> or chapter 473H for taxes payable in any of the five calendar <br/>
<a id="pl.104.5"></a><var>104.5</var>years before the filing of the request for certification only for: <br/>
<a id="pl.104.6"></a><var>104.6</var>    (1) a district in which 85 percent or more of the planned buildings and facilities <br/>
<a id="pl.104.7"></a><var>104.7</var>(determined on the basis of square footage) are a qualified manufacturing facility or a <br/>
<a id="pl.104.8"></a><var>104.8</var>qualified distribution facility or a combination of both; or<br/>
<a id="pl.104.9"></a><var>104.9</var>    (2) a qualified housing district.<br/>
<a id="pl.104.10"></a><var>104.10</var>    (b)(1) A distribution facility means buildings and other improvements to real <br/>
<a id="pl.104.11"></a><var>104.11</var>property that are used to conduct activities in at least each of the following categories:<br/>
<a id="pl.104.12"></a><var>104.12</var>    (i) to store or warehouse tangible personal property;<br/>
<a id="pl.104.13"></a><var>104.13</var>    (ii) to take orders for shipment, mailing, or delivery;<br/>
<a id="pl.104.14"></a><var>104.14</var>    (iii) to prepare personal property for shipment, mailing, or delivery; and<br/>
<a id="pl.104.15"></a><var>104.15</var>    (iv) to ship, mail, or deliver property.<br/>
<a id="pl.104.16"></a><var>104.16</var>    (2) A manufacturing facility includes space used for manufacturing or producing <br/>
<a id="pl.104.17"></a><var>104.17</var>tangible personal property, including processing resulting in the change in condition of the <br/>
<a id="pl.104.18"></a><var>104.18</var>property, and space necessary for and related to the manufacturing activities.<br/>
<a id="pl.104.19"></a><var>104.19</var>    (3) To be a qualified facility, the owner or operator of a manufacturing or distribution <br/>
<a id="pl.104.20"></a><var>104.20</var>facility must agree to pay and pay 90 percent or more of the employees of the facility at <br/>
<a id="pl.104.21"></a><var>104.21</var>a rate equal to or greater than 160 percent of the federal minimum wage for individuals <br/>
<a id="pl.104.22"></a><var>104.22</var>over the age of 20.<br/>
<a id="pl.104.23"></a><var>104.23</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment <br/>
<a id="pl.104.24"></a><var>104.24</var>and applies to all districts regardless of when the request for certification was made.<br/>
<br/>
<a id="bill.9.10.0"></a><a id="pl.104.25"></a><var>104.25</var>    Sec. 10. Minnesota Statutes 2006, section 469.1761, subdivision 1, is amended to read:<br/>
<a id="pl.104.26"></a><var>104.26</var>    Subdivision 1. <b>Requirement imposed.</b> (a) In order for a tax increment financing <br/>
<a id="pl.104.27"></a><var>104.27</var>district to qualify as a housing district:<br/>
<a id="pl.104.28"></a><var>104.28</var>    (1) the income limitations provided in this section must be satisfied; and<br/>
<a id="pl.104.29"></a><var>104.29</var>    (2) no more than 20 percent of the square footage of buildings that receive assistance <br/>
<a id="pl.104.30"></a><var>104.30</var>from tax increments may consist of commercial, retail, or other nonresidential uses.<br/>
<a id="pl.104.31"></a><var>104.31</var>    (b) The requirements imposed by this section apply to property receiving assistance <br/>
<a id="pl.104.32"></a><var>104.32</var>financed with tax increments, including interest reduction, land transfers at less than the <br/>
<a id="pl.104.33"></a><var>104.33</var>authority's cost of acquisition, utility service or connections, roads, parking facilities, or <br/>
<a id="pl.104.34"></a><var>104.34</var>other subsidies. The provisions of this section do not apply to districts located in a targeted <br/>
<a id="pl.104.35"></a><var>104.35</var>area as defined in section 
         <statute_ref>462C.02, subdivision 9</statute_ref>, clause (e).<br/>
<a id="pl.105.1"></a><var>105.1</var>    (c) For purposes of the requirements of paragraph (a), the authority may elect to treat <br/>
<a id="pl.105.2"></a><var>105.2</var>an addition to an existing structure as a separate building if:<br/>
<a id="pl.105.3"></a><var>105.3</var>    (1) construction of the addition begins more than three years after construction of <br/>
<a id="pl.105.4"></a><var>105.4</var>the existing structure was completed; and <br/>
<a id="pl.105.5"></a><var>105.5</var>    (2) for an addition that does not meet the requirements of paragraph (a), clause (2), if <br/>
<a id="pl.105.6"></a><var>105.6</var>it is treated as a separate building, the addition was not contemplated by the tax increment <br/>
<a id="pl.105.7"></a><var>105.7</var>financing plan which includes the existing structure.<br/>
<a id="pl.105.8"></a><var>105.8</var><b>EFFECTIVE DATE.</b>This section is effective for expenditures of tax increment <br/>
<a id="pl.105.9"></a><var>105.9</var>authorized and made after the day following final enactment, regardless of when the <br/>
<a id="pl.105.10"></a><var>105.10</var>request for certification of the district was made.<br/>
<br/>
<a id="bill.9.11.0"></a><a id="pl.105.11"></a><var>105.11</var>    Sec. 11. Minnesota Statutes 2006, section 469.1763, subdivision 2, is amended to read:<br/>
<a id="pl.105.12"></a><var>105.12</var>    Subd. 2. <b>Expenditures outside district.</b> (a) For each tax increment financing <br/>
<a id="pl.105.13"></a><var>105.13</var>district, an amount equal to at least 75 percent of the total revenue derived from tax <br/>
<a id="pl.105.14"></a><var>105.14</var>increments paid by properties in the district must be expended on activities in the district <br/>
<a id="pl.105.15"></a><var>105.15</var>or to pay bonds, to the extent that the proceeds of the bonds were used to finance activities <br/>
<a id="pl.105.16"></a><var>105.16</var>in the district or to pay, or secure payment of, debt service on credit enhanced bonds. <br/>
<a id="pl.105.17"></a><var>105.17</var>For districts, other than redevelopment districts for which the request for certification <br/>
<a id="pl.105.18"></a><var>105.18</var>was made after June 30, 1995, the in-district percentage for purposes of the preceding <br/>
<a id="pl.105.19"></a><var>105.19</var>sentence is 80 percent. Not more than 25 percent of the total revenue derived from tax <br/>
<a id="pl.105.20"></a><var>105.20</var>increments paid by properties in the district may be expended, through a development fund <br/>
<a id="pl.105.21"></a><var>105.21</var>or otherwise, on activities outside of the district but within the defined geographic area of <br/>
<a id="pl.105.22"></a><var>105.22</var>the project except to pay, or secure payment of, debt service on credit enhanced bonds. <br/>
<a id="pl.105.23"></a><var>105.23</var>For districts, other than redevelopment districts for which the request for certification was <br/>
<a id="pl.105.24"></a><var>105.24</var>made after June 30, 1995, the pooling percentage for purposes of the preceding sentence is <br/>
<a id="pl.105.25"></a><var>105.25</var>20 percent. The revenue derived from tax increments for the district that are expended on <br/>
<a id="pl.105.26"></a><var>105.26</var>costs under section 
         <statute_ref>469.176, subdivision 4h</statute_ref>, paragraph (b), may be deducted first before <br/>
<a id="pl.105.27"></a><var>105.27</var>calculating the percentages that must be expended within and without the district.<br/>
<a id="pl.105.28"></a><var>105.28</var>    (b) In the case of a housing district, a housing project, as defined in section 
         <statute_ref>469.174, <br/>
<a id="pl.105.29"></a><var>105.29</var>subdivision 11
         </statute_ref>, is an activity in the district.<br/>
<a id="pl.105.30"></a><var>105.30</var>    (c) All administrative expenses are for activities outside of the district, except that <br/>
<a id="pl.105.31"></a><var>105.31</var>if the only expenses for activities outside of the district under this subdivision are for <br/>
<a id="pl.105.32"></a><var>105.32</var>the purposes described in paragraph (d), administrative expenses will be considered as <br/>
<a id="pl.105.33"></a><var>105.33</var>expenditures for activities in the district.<br/>
<a id="pl.105.34"></a><var>105.34</var>    (d) The authority may elect, in the tax increment financing plan for the district, <br/>
<a id="pl.105.35"></a><var>105.35</var>to increase by up to ten percentage points the permitted amount of expenditures for <br/>
<a id="pl.106.1"></a><var>106.1</var>activities located outside the geographic area of the district under paragraph (a). As <br/>
<a id="pl.106.2"></a><var>106.2</var>permitted by section 
         <statute_ref>469.176, subdivision 4k</statute_ref>, the expenditures, including the permitted <br/>
<a id="pl.106.3"></a><var>106.3</var>expenditures under paragraph (a), need not be made within the geographic area of the <br/>
<a id="pl.106.4"></a><var>106.4</var>project. Expenditures that meet the requirements of this paragraph are legally permitted <br/>
<a id="pl.106.5"></a><var>106.5</var>expenditures of the district, notwithstanding section 
         <statute_ref>469.176, subdivisions 4b, 4c, and 4j</statute_ref>. <br/>
<a id="pl.106.6"></a><var>106.6</var>To qualify for the increase under this paragraph, the expenditures must:<br/>
<a id="pl.106.7"></a><var>106.7</var>    (1) be used exclusively to assist housing that meets the requirement for a qualified <br/>
<a id="pl.106.8"></a><var>106.8</var>low-income building, as that term is used in section 42 of the Internal Revenue Code;<br/>
<a id="pl.106.9"></a><var>106.9</var>    (2) not exceed the qualified basis of the housing, as defined under section 42(c) of <br/>
<a id="pl.106.10"></a><var>106.10</var>the Internal Revenue Code, less the amount of any credit allowed under section 42 of <br/>
<a id="pl.106.11"></a><var>106.11</var>the Internal Revenue Code; and<br/>
<a id="pl.106.12"></a><var>106.12</var>    (3) be used to:<br/>
<a id="pl.106.13"></a><var>106.13</var>    (i) acquire and prepare the site of the housing;<br/>
<a id="pl.106.14"></a><var>106.14</var>    (ii) acquire, construct, or rehabilitate the housing; or<br/>
<a id="pl.106.15"></a><var>106.15</var>    (iii) make public improvements directly related to the housing.<br/>
<a id="pl.106.16"></a><var>106.16</var>    (e) For a district created within a biotechnology and health sciences industry zone <br/>
<a id="pl.106.17"></a><var>106.17</var>as defined in section 
         <statute_ref>469.330, subdivision 6</statute_ref>, or for an existing district located within <br/>
<a id="pl.106.18"></a><var>106.18</var>such a zone, tax increment derived from such a district may be expended outside of the <br/>
<a id="pl.106.19"></a><var>106.19</var>district but within the zone only for expenditures required for the construction of public <br/>
<a id="pl.106.20"></a><var>106.20</var>infrastructure necessary to support the activities of the zone, land acquisition, and other <br/>
<a id="pl.106.21"></a><var>106.21</var>redevelopment costs as defined in section 469.176, subdivision 4j. Public infrastructure <br/>
<a id="pl.106.22"></a><var>106.22</var>These expenditures are considered as expenditures for activities within the district.<br/>
<a id="pl.106.23"></a><var>106.23</var><b>EFFECTIVE DATE.</b>This section is effective for all districts located in bioscience <br/>
<a id="pl.106.24"></a><var>106.24</var>zones, regardless of when the request for certification was made.<br/>
<br/>
<a id="bill.9.12.0"></a><a id="pl.106.25"></a><var>106.25</var>    Sec. 12. Minnesota Statutes 2006, section 469.177, subdivision 1, is amended to read:<br/>
<a id="pl.106.26"></a><var>106.26</var>    Subdivision 1. <b>Original net tax capacity.</b> (a) Upon or after adoption of a tax <br/>
<a id="pl.106.27"></a><var>106.27</var>increment financing plan, the auditor of any county in which the district is situated shall, <br/>
<a id="pl.106.28"></a><var>106.28</var>upon request of the authority, certify the original net tax capacity of the tax increment <br/>
<a id="pl.106.29"></a><var>106.29</var>financing district and that portion of the district overlying any subdistrict as described in <br/>
<a id="pl.106.30"></a><var>106.30</var>the tax increment financing plan and shall certify in each year thereafter the amount by <br/>
<a id="pl.106.31"></a><var>106.31</var>which the original net tax capacity has increased or decreased as a result of a change in tax <br/>
<a id="pl.106.32"></a><var>106.32</var>exempt status of property within the district and any subdistrict, reduction or enlargement <br/>
<a id="pl.106.33"></a><var>106.33</var>of the district or changes pursuant to subdivision 4. The auditor shall certify the amount <br/>
<a id="pl.106.34"></a><var>106.34</var>within 30 days after receipt of the request and sufficient information to identify the parcels <br/>
<a id="pl.107.1"></a><var>107.1</var>included in the district. The certification relates to the taxes payable year as provided in <br/>
<a id="pl.107.2"></a><var>107.2</var>subdivision 6.<br/>
<a id="pl.107.3"></a><var>107.3</var>    (b) If the classification under section 
         <statute_ref>273.13</statute_ref> of property located in a district changes <br/>
<a id="pl.107.4"></a><var>107.4</var>to a classification that has a different assessment ratio, the original net tax capacity of that <br/>
<a id="pl.107.5"></a><var>107.5</var>property must be redetermined at the time when its use is changed as if the property had <br/>
<a id="pl.107.6"></a><var>107.6</var>originally been classified in the same class in which it is classified after its use is changed.<br/>
<a id="pl.107.7"></a><var>107.7</var>    (c) The amount to be added to the original net tax capacity of the district as a result <br/>
<a id="pl.107.8"></a><var>107.8</var>of previously tax exempt real property within the district becoming taxable equals the net <br/>
<a id="pl.107.9"></a><var>107.9</var>tax capacity of the real property as most recently assessed pursuant to section 
         <statute_ref>273.18</statute_ref> or, if <br/>
<a id="pl.107.10"></a><var>107.10</var>that assessment was made more than one year prior to the date of title transfer rendering <br/>
<a id="pl.107.11"></a><var>107.11</var>the property taxable, the net tax capacity assessed by the assessor at the time of the <br/>
<a id="pl.107.12"></a><var>107.12</var>transfer. If improvements are made to tax exempt property after the municipality approves <br/>
<a id="pl.107.13"></a><var>107.13</var>the district and before the parcel becomes taxable, the assessor shall, at the request of <br/>
<a id="pl.107.14"></a><var>107.14</var>the authority, separately assess the estimated market value of the improvements. If the <br/>
<a id="pl.107.15"></a><var>107.15</var>property becomes taxable, the county auditor shall add to original net tax capacity, the net <br/>
<a id="pl.107.16"></a><var>107.16</var>tax capacity of the parcel, excluding the separately assessed improvements. If substantial <br/>
<a id="pl.107.17"></a><var>107.17</var>taxable improvements were made to a parcel after certification of the district and if the <br/>
<a id="pl.107.18"></a><var>107.18</var>property later becomes tax exempt, in whole or part, as a result of the authority acquiring <br/>
<a id="pl.107.19"></a><var>107.19</var>the property through foreclosure or exercise of remedies under a lease or other revenue <br/>
<a id="pl.107.20"></a><var>107.20</var>agreement or as a result of tax forfeiture, the amount to be added to the original net tax <br/>
<a id="pl.107.21"></a><var>107.21</var>capacity of the district as a result of the property again becoming taxable is the amount <br/>
<a id="pl.107.22"></a><var>107.22</var>of the parcel's value that was included in original net tax capacity when the parcel was <br/>
<a id="pl.107.23"></a><var>107.23</var>first certified. The amount to be added to the original net tax capacity of the district as a <br/>
<a id="pl.107.24"></a><var>107.24</var>result of enlargements equals the net tax capacity of the added real property as most <br/>
<a id="pl.107.25"></a><var>107.25</var>recently certified by the commissioner of revenue as of the date of modification of the tax <br/>
<a id="pl.107.26"></a><var>107.26</var>increment financing plan pursuant to section 
         <statute_ref>469.175, subdivision 4</statute_ref>.<br/>
<a id="pl.107.27"></a><var>107.27</var>    (d) If the net tax capacity of a property increases because the property no longer <br/>
<a id="pl.107.28"></a><var>107.28</var>qualifies under the Minnesota Agricultural Property Tax Law, section 
         <statute_ref>273.111</statute_ref>; the <br/>
<a id="pl.107.29"></a><var>107.29</var>Minnesota Open Space Property Tax Law, section 
         <statute_ref>273.112</statute_ref>; or the Metropolitan <br/>
<a id="pl.107.30"></a><var>107.30</var>Agricultural Preserves Act, chapter 473H, or because platted, unimproved property is <br/>
<a id="pl.107.31"></a><var>107.31</var>improved or market value is increased after approval of the plat under section 
         <statute_ref>273.11, <br/>
<a id="pl.107.32"></a><var>107.32</var>subdivision 14
         </statute_ref>, 14a, or 14b, the increase in net tax capacity must be added to the original <br/>
<a id="pl.107.33"></a><var>107.33</var>net tax capacity.<br/>
<a id="pl.107.34"></a><var>107.34</var>    (e) The amount to be subtracted from the original net tax capacity of the district <br/>
<a id="pl.107.35"></a><var>107.35</var>as a result of previously taxable real property within the district becoming tax exempt, <br/>
<a id="pl.107.36"></a><var>107.36</var>or a reduction in the geographic area of the district, shall be the amount of original net <br/>
<a id="pl.108.1"></a><var>108.1</var>tax capacity initially attributed to the property becoming tax exempt or being removed <br/>
<a id="pl.108.2"></a><var>108.2</var>from the district. If the net tax capacity of property located within the tax increment <br/>
<a id="pl.108.3"></a><var>108.3</var>financing district is reduced by reason of a court-ordered abatement, stipulation agreement, <br/>
<a id="pl.108.4"></a><var>108.4</var>voluntary abatement made by the assessor or auditor or by order of the commissioner of <br/>
<a id="pl.108.5"></a><var>108.5</var>revenue, the reduction shall be applied to the original net tax capacity of the district when <br/>
<a id="pl.108.6"></a><var>108.6</var>the property upon which the abatement is made has not been improved since the date of <br/>
<a id="pl.108.7"></a><var>108.7</var>certification of the district and to the captured net tax capacity of the district in each year <br/>
<a id="pl.108.8"></a><var>108.8</var>thereafter when the abatement relates to improvements made after the date of certification. <br/>
<a id="pl.108.9"></a><var>108.9</var>The county auditor may specify reasonable form and content of the request for certification <br/>
<a id="pl.108.10"></a><var>108.10</var>of the authority and any modification thereof pursuant to section 
         <statute_ref>469.175, subdivision 4</statute_ref>.<br/>
<a id="pl.108.11"></a><var>108.11</var>    (f) If a parcel of property contained a substandard building or improvements <br/>
<a id="pl.108.12"></a><var>108.12</var>described in section 469.174, subdivision 10, paragraph (e), that was were demolished <br/>
<a id="pl.108.13"></a><var>108.13</var>or removed and if the authority elects to treat the parcel as occupied by a substandard <br/>
<a id="pl.108.14"></a><var>108.14</var>building under section 
         <statute_ref>469.174, subdivision 10</statute_ref>, paragraph (b), or by improvements under <br/>
<a id="pl.108.15"></a><var>108.15</var>section 469.174, subdivision 10, paragraph (e), the auditor shall certify the original net <br/>
<a id="pl.108.16"></a><var>108.16</var>tax capacity of the parcel using the greater of (1) the current net tax capacity of the <br/>
<a id="pl.108.17"></a><var>108.17</var>parcel, or (2) the estimated market value of the parcel for the year in which the building <br/>
<a id="pl.108.18"></a><var>108.18</var>was or other improvements were demolished or removed, but applying the class rates <br/>
<a id="pl.108.19"></a><var>108.19</var>for the current year.<br/>
<a id="pl.108.20"></a><var>108.20</var>    (g) For a redevelopment district qualifying under section 
         <statute_ref>469.174, subdivision 10</statute_ref>, <br/>
<a id="pl.108.21"></a><var>108.21</var>paragraph (a), clause (4), as a qualified disaster area, the auditor shall certify the value of <br/>
<a id="pl.108.22"></a><var>108.22</var>the land as the original tax capacity for any parcel in the district that contains a building <br/>
<a id="pl.108.23"></a><var>108.23</var>that suffered substantial damage as a result of the disaster or emergency.<br/>
<a id="pl.108.24"></a><var>108.24</var><b>EFFECTIVE DATE.</b>This section is effective for requests for certification made <br/>
<a id="pl.108.25"></a><var>108.25</var>after June 30, 2008.<br/>
<br/>
<a id="bill.9.13.0"></a><a id="pl.108.26"></a><var>108.26</var>    Sec. 13. Minnesota Statutes 2006, section 469.178, subdivision 7, is amended to read:<br/>
<a id="pl.108.27"></a><var>108.27</var>    Subd. 7. <b>Interfund loans.</b> The authority or municipality may advance or loan <br/>
<a id="pl.108.28"></a><var>108.28</var>money to finance expenditures under section 
         <statute_ref>469.176, subdivision 4</statute_ref>, from its general <br/>
<a id="pl.108.29"></a><var>108.29</var>fund or any other fund under which it has legal authority to do so. The loan or advance <br/>
<a id="pl.108.30"></a><var>108.30</var>must be authorized, by resolution of the governing body or of the authority, whichever <br/>
<a id="pl.108.31"></a><var>108.31</var>has jurisdiction over the fund from which the advance or loan is made, before money <br/>
<a id="pl.108.32"></a><var>108.32</var>is transferred, advanced, or spent, whichever is earliest. The resolution may generally <br/>
<a id="pl.108.33"></a><var>108.33</var>grant to the authority the power to make interfund loans under one or more tax increment <br/>
<a id="pl.108.34"></a><var>108.34</var>financing plans or for one or more districts. The terms and conditions for repayment of the <br/>
<a id="pl.108.35"></a><var>108.35</var>loan must be provided in writing and include, at a minimum, the principal amount, the <br/>
<a id="pl.109.1"></a><var>109.1</var>interest rate, and maximum term. The maximum rate of interest permitted to be charged <br/>
<a id="pl.109.2"></a><var>109.2</var>is limited to the greater of the rates specified under section 
         <statute_ref>270C.40</statute_ref> or 
         <statute_ref>549.09</statute_ref> as of the <br/>
<a id="pl.109.3"></a><var>109.3</var>date the loan or advance is made, unless the written agreement states that the maximum <br/>
<a id="pl.109.4"></a><var>109.4</var>interest rate will fluctuate as the interest rates specified under section 
         <statute_ref>270C.40</statute_ref> or 
         <statute_ref>549.09</statute_ref> <br/>
<a id="pl.109.5"></a><var>109.5</var>are from time to time adjusted.<br/>
<a id="pl.109.6"></a><var>109.6</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment <br/>
<a id="pl.109.7"></a><var>109.7</var>and applies to all districts subject to Minnesota Statutes, section 469.178, subdivision 7, <br/>
<a id="pl.109.8"></a><var>109.8</var>regardless of when the request for certification was made.<br/>
<br/>
<a id="bill.9.14.0"></a><a id="pl.109.9"></a><var>109.9</var>    Sec. 14. Minnesota Statutes 2006, section 469.1791, subdivision 3, is amended to read:<br/>
<a id="pl.109.10"></a><var>109.10</var>    Subd. 3. <b>Preconditions to establish district.</b> (a) A city may establish a special <br/>
<a id="pl.109.11"></a><var>109.11</var>taxing district within a tax increment financing district under this section only if the <br/>
<a id="pl.109.12"></a><var>109.12</var>conditions under paragraphs (b) and (c) are met or if the city elects to exercise the <br/>
<a id="pl.109.13"></a><var>109.13</var>authority under paragraph (d).<br/>
<a id="pl.109.14"></a><var>109.14</var>    (b) The city has determined that:<br/>
<a id="pl.109.15"></a><var>109.15</var>    (1) total tax increments from the district, including unspent increments from <br/>
<a id="pl.109.16"></a><var>109.16</var>previous years and increments transferred under paragraph (c), will be insufficient to pay <br/>
<a id="pl.109.17"></a><var>109.17</var>the amounts due in a year on preexisting obligations; and<br/>
<a id="pl.109.18"></a><var>109.18</var>    (2) this insufficiency of increments resulted from the reduction in property tax class <br/>
<a id="pl.109.19"></a><var>109.19</var>rates enacted in the 1997 and 1998 legislative sessions.<br/>
<a id="pl.109.20"></a><var>109.20</var>    (c) The city has agreed to transfer any available increments from other tax increment <br/>
<a id="pl.109.21"></a><var>109.21</var>financing districts in the city to pay the preexisting obligations of the district under section <br/>
<statute_ref><a id="pl.109.22"></a><var>109.22</var>469.1763, subdivision 6
         </statute_ref>. This requirement does not apply to any available increments of a <br/>
<a id="pl.109.23"></a><var>109.23</var>qualified housing district. <br/>
<a id="pl.109.24"></a><var>109.24</var>    (d) If a tax increment financing district does not qualify under paragraphs (b) and <br/>
<a id="pl.109.25"></a><var>109.25</var>(c), the governing body may elect to establish a special taxing district under this section. <br/>
<a id="pl.109.26"></a><var>109.26</var>If the city elects to exercise this authority, increments from the tax increment financing <br/>
<a id="pl.109.27"></a><var>109.27</var>district and the proceeds of the tax imposed under this section may only be used to pay <br/>
<a id="pl.109.28"></a><var>109.28</var>preexisting obligations and reasonable administrative expenses of the authority for the tax <br/>
<a id="pl.109.29"></a><var>109.29</var>increment financing district. The tax increment financing district must be decertified when <br/>
<a id="pl.109.30"></a><var>109.30</var>all preexisting obligations have been paid.<br/>
<a id="pl.109.31"></a><var>109.31</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment <br/>
<a id="pl.109.32"></a><var>109.32</var>and applies to districts regardless of when the request for certification was made.<br/>
<br/>
<a id="bill.9.15.0"></a><a id="pl.110.1"></a><var>110.1</var>    Sec. 15. Laws 1994, chapter 587, article 9, section 14, subdivision 1, is amended to <br/>
<a id="pl.110.2"></a><var>110.2</var>read:<br/>
<a id="pl.110.3"></a><var>110.3</var>    Subdivision 1. <b>Establishment.</b> The city of Brooklyn Center may establish an <br/>
<a id="pl.110.4"></a><var>110.4</var>a redevelopment tax increment financing district in which 15 percent of the revenues <br/>
<a id="pl.110.5"></a><var>110.5</var>generated from tax increment in any year is deposited in the housing and environmental <br/>
<a id="pl.110.6"></a><var>110.6</var>remediation development account of the authority and expended according to the tax <br/>
<a id="pl.110.7"></a><var>110.7</var>increment financing plan.<br/>
<a id="pl.110.8"></a><var>110.8</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.9.16.0"></a><a id="pl.110.9"></a><var>110.9</var>    Sec. 16. Laws 1994, chapter 587, article 9, section 14, subdivision 2, is amended to <br/>
<a id="pl.110.10"></a><var>110.10</var>read:<br/>
<a id="pl.110.11"></a><var>110.11</var>    Subd. 2. <b>Eligible activities.</b> The authority must identify in the plan the housing <br/>
<a id="pl.110.12"></a><var>110.12</var>activities that will be assisted by the housing and environmental remediation development <br/>
<a id="pl.110.13"></a><var>110.13</var>account. Housing activities may include rehabilitation, acquisition, construction, <br/>
<a id="pl.110.14"></a><var>110.14</var>demolition, and financing of new or existing single family or multifamily housing. <br/>
<a id="pl.110.15"></a><var>110.15</var>Housing and environmental remediation activities listed in the plan need not be located <br/>
<a id="pl.110.16"></a><var>110.16</var>within the district or project area but must be activities that meet the income requirements <br/>
<a id="pl.110.17"></a><var>110.17</var>of a qualified housing district under Minnesota Statutes, section 
         <statute_ref>273.1399</statute_ref> or
<statute_ref>469.1761, <br/>
<a id="pl.110.18"></a><var>110.18</var>subdivision 2
</statute_ref>.<br/>
<a id="pl.110.19"></a><var>110.19</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.9.17.0"></a><a id="pl.110.20"></a><var>110.20</var>    Sec. 17. Laws 1994, chapter 587, article 9, section 14, subdivision 3, is amended to <br/>
<a id="pl.110.21"></a><var>110.21</var>read:<br/>
<a id="pl.110.22"></a><var>110.22</var>    Subd. 3. <b>Housing account.</b> Tax increment to be expended for housing and <br/>
<a id="pl.110.23"></a><var>110.23</var>environmental remediation activities under this section must be segregated by the <br/>
<a id="pl.110.24"></a><var>110.24</var>authority into a special account on its official books and records. The account may also <br/>
<a id="pl.110.25"></a><var>110.25</var>receive funds from other public and private sources.<br/>
<a id="pl.110.26"></a><var>110.26</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.9.18.0"></a><a id="pl.110.27"></a><var>110.27</var>    Sec. 18. Laws 1995, chapter 264, article 5, section 44, subdivision 4, as amended by <br/>
<a id="pl.110.28"></a><var>110.28</var>Laws 1996, chapter 471, article 7, section 21, and Laws 1997, chapter 231, article 10, <br/>
<a id="pl.110.29"></a><var>110.29</var>section 12, is amended to read:<br/>
<a id="pl.110.30"></a><var>110.30</var>    Subd. 4. <b>Authority.</b> For housing replacement projects in the city of Crystal, <br/>
<a id="pl.110.31"></a><var>110.31</var>"authority" means the Crystal economic development authority. For housing replacement <br/>
<a id="pl.110.32"></a><var>110.32</var>projects in the city of Fridley, "authority" means the housing and redevelopment authority <br/>
<a id="pl.111.1"></a><var>111.1</var>in and for the city of Fridley or a successor in interest. For housing replacement <br/>
<a id="pl.111.2"></a><var>111.2</var>projects in the city of Minneapolis, "authority" means the Minneapolis community <br/>
<a id="pl.111.3"></a><var>111.3</var>development agency or its successors and assigns. For housing replacement projects <br/>
<a id="pl.111.4"></a><var>111.4</var>in the city of St. Paul, "authority" means the St. Paul housing and redevelopment <br/>
<a id="pl.111.5"></a><var>111.5</var>authority. For housing replacement projects in the city of Duluth, "authority" means the <br/>
<a id="pl.111.6"></a><var>111.6</var>Duluth economic development authority. For housing replacement projects in the city of <br/>
<a id="pl.111.7"></a><var>111.7</var>Richfield, "authority" is the authority as defined in Minnesota Statutes, section 
         <statute_ref>469.174, <br/>
<a id="pl.111.8"></a><var>111.8</var>subdivision 2
         </statute_ref>, that is designated by the governing body of the city of Richfield. For <br/>
<a id="pl.111.9"></a><var>111.9</var>housing replacement projects in the city of Columbia Heights, "authority" is the authority <br/>
<a id="pl.111.10"></a><var>111.10</var>as defined in Minnesota Statutes, section 
         <statute_ref>469.174, subdivision 2</statute_ref>, that is designated by the <br/>
<a id="pl.111.11"></a><var>111.11</var>governing body of the city of Columbia Heights.<br/>
<a id="pl.111.12"></a><var>111.12</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment <br/>
<a id="pl.111.13"></a><var>111.13</var>and upon compliance by the governing body of the city of Minneapolis with Minnesota <br/>
<a id="pl.111.14"></a><var>111.14</var>Statutes, section 645.021, subdivision 3.<br/>
<br/>
<a id="bill.9.19.0"></a><a id="pl.111.15"></a><var>111.15</var>    Sec. 19. Laws 1995, chapter 264, article 5, section 45, subdivision 1, as amended by <br/>
<a id="pl.111.16"></a><var>111.16</var>Laws 1996, chapter 471, article 7, section 22, and Laws 1997, chapter 231, article 10, <br/>
<a id="pl.111.17"></a><var>111.17</var>section 13, and Laws 2002, chapter 377, article 7, section 6, is amended to read:<br/>
<a id="pl.111.18"></a><var>111.18</var>    Subdivision 1. <b>Creation of projects.</b> (a) An authority may create a housing <br/>
<a id="pl.111.19"></a><var>111.19</var>replacement project under sections 44 to 47, as provided in this section.<br/>
<a id="pl.111.20"></a><var>111.20</var>    (b) For the cities of Crystal, Fridley, Richfield, and Columbia Heights, the authority <br/>
<a id="pl.111.21"></a><var>111.21</var>may designate up to 50 parcels in the city to be included in a housing replacement <br/>
<a id="pl.111.22"></a><var>111.22</var>district. No more than ten parcels may be included in year one of the district, with up <br/>
<a id="pl.111.23"></a><var>111.23</var>to ten additional parcels added to the district in each of the following nine years. For <br/>
<a id="pl.111.24"></a><var>111.24</var>the cities of Minneapolis, St. Paul, and Duluth, each authority may designate not more <br/>
<a id="pl.111.25"></a><var>111.25</var>than 200 parcels in the city to be included in a housing replacement district over the life <br/>
<a id="pl.111.26"></a><var>111.26</var>of the district. For the city of Minneapolis, the authority may designate not more than <br/>
<a id="pl.111.27"></a><var>111.27</var>400 parcels in the city to be included in housing replacement districts over the life of <br/>
<a id="pl.111.28"></a><var>111.28</var>the districts. The only parcels that may be included in a district are (1) vacant sites, (2) <br/>
<a id="pl.111.29"></a><var>111.29</var>parcels containing vacant houses, or (3) parcels containing houses that are structurally <br/>
<a id="pl.111.30"></a><var>111.30</var>substandard, as defined in Minnesota Statutes, section 
         <statute_ref>469.174, subdivision 10</statute_ref>.<br/>
<a id="pl.111.31"></a><var>111.31</var>    (c) The city in which the authority is located must pay at least 25 percent of the <br/>
<a id="pl.111.32"></a><var>111.32</var>housing replacement project costs from its general fund, a property tax levy, or other <br/>
<a id="pl.111.33"></a><var>111.33</var>unrestricted money, not including tax increments.<br/>
<a id="pl.111.34"></a><var>111.34</var>    (d) The housing replacement district plan must have as its sole object the acquisition <br/>
<a id="pl.111.35"></a><var>111.35</var>of parcels for the purpose of preparing the site to be sold for market rate housing. As <br/>
<a id="pl.112.1"></a><var>112.1</var>used in this section, "market rate housing" means housing that has a market value that <br/>
<a id="pl.112.2"></a><var>112.2</var>does not exceed 150 percent of the average market value of single-family housing in that <br/>
<a id="pl.112.3"></a><var>112.3</var>municipality.<br/>
<a id="pl.112.4"></a><var>112.4</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment <br/>
<a id="pl.112.5"></a><var>112.5</var>and upon compliance by the governing body of the city of Minneapolis with Minnesota <br/>
<a id="pl.112.6"></a><var>112.6</var>Statutes, section 645.021, subdivision 3.<br/>
<br/>
<a id="bill.9.20.0"></a><a id="pl.112.7"></a><var>112.7</var>    Sec. 20. Laws 2005, First Special Session chapter 3, article 10, section 23, as amended <br/>
<a id="pl.112.8"></a><var>112.8</var>by Laws 2006, chapter 259, article 13, section 16, is amended to read:<br/>
<a id="pl.112.9"></a><var>112.9</var>    Sec. 23. <b>GRANTS TO QUALIFYING BUSINESSES. </b><br/>
<a id="pl.112.10"></a><var>112.10</var>    $750,000 is appropriated in fiscal year 2006 from the general fund to the <br/>
<a id="pl.112.11"></a><var>112.11</var>commissioner of employment and economic development to be distributed to the <br/>
<a id="pl.112.12"></a><var>112.12</var>foreign trade zone authority to provide grants to qualified businesses as determined <br/>
<a id="pl.112.13"></a><var>112.13</var>by the authority, subject to Minnesota Statutes, sections 116J.993 to 116J.995, to <br/>
<a id="pl.112.14"></a><var>112.14</var>provide incentives for the businesses to locate their operations in an international <br/>
<a id="pl.112.15"></a><var>112.15</var>economic development zone. Of this appropriation, up to $250,000 may be used by the <br/>
<a id="pl.112.16"></a><var>112.16</var>commissioner for a study to determine the economic viability of business plans for <br/>
<a id="pl.112.17"></a><var>112.17</var>international economic development zones. If the money is not distributed during fiscal <br/>
<a id="pl.112.18"></a><var>112.18</var>year 2006, it remains available for distribution under this section until December 31, 2010.<br/>
<a id="pl.112.19"></a><var>112.19</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.9.21.0"></a><a id="pl.112.20"></a><var>112.20</var>    Sec. 21. <b>BURNSVILLE; NORTHWEST QUADRANT TAX INCREMENT </b><br/>
<a id="pl.112.21"></a><var>112.21</var><b>FINANCING.</b><br/>
<a id="pl.112.22"></a><var>112.22</var>    Subdivision 1. <b>Definitions.</b> (a) For the purposes of this section, the words and <br/>
<a id="pl.112.23"></a><var>112.23</var>phrases defined have the meanings given them in this subdivision.<br/>
<a id="pl.112.24"></a><var>112.24</var>    (b) "City" means the city of Burnsville.<br/>
<a id="pl.112.25"></a><var>112.25</var>    (c) "Project area" means the area in the city bounded on the south, southeast, and <br/>
<a id="pl.112.26"></a><var>112.26</var>southwest by the southerly right-of-way line of Minnesota Trunk Highway 13; on the east <br/>
<a id="pl.112.27"></a><var>112.27</var>by the easterly right-of-way line of Interstate Highway I-35W; on the north and northwest <br/>
<a id="pl.112.28"></a><var>112.28</var>by the Minnesota River; and on the west by the westerly corporate limits of the city, <br/>
<a id="pl.112.29"></a><var>112.29</var>together with a single parcel to the east of said Interstate Highway I-35W described as <br/>
<a id="pl.112.30"></a><var>112.30</var>the North 1370 feet of the West 1075 feet of the NW Quarter of Section 34 Township 27 <br/>
<a id="pl.112.31"></a><var>112.31</var>Range 24 in the city of Burnsville, Dakota County, except the North 50 feet thereof; <br/>
<a id="pl.112.32"></a><var>112.32</var>provided that the project area includes the rights-of-way for all present and future highway <br/>
<a id="pl.112.33"></a><var>112.33</var>interchanges abutting the area described in this paragraph.<br/>
<a id="pl.113.1"></a><var>113.1</var>    (d) "Soil deficiency district" means a type of tax increment financing district <br/>
<a id="pl.113.2"></a><var>113.2</var>consisting of a portion of the project area in which the city finds by resolution that the <br/>
<a id="pl.113.3"></a><var>113.3</var>following conditions exist:<br/>
<a id="pl.113.4"></a><var>113.4</var>    (1) unusual terrain or soil deficiencies for 80 percent of the acreage in the district <br/>
<a id="pl.113.5"></a><var>113.5</var>require substantial filling, grading, or other physical preparation for use; and<br/>
<a id="pl.113.6"></a><var>113.6</var>    (2) the estimated cost of the physical preparation under clause (1), but excluding <br/>
<a id="pl.113.7"></a><var>113.7</var>costs directly related to roads as defined in Minnesota Statutes, section 160.01, and <br/>
<a id="pl.113.8"></a><var>113.8</var>local improvements as described in Minnesota Statutes, sections 429.021, subdivision 1, <br/>
<a id="pl.113.9"></a><var>113.9</var>clauses (1) to (7), (11), and (12), and 430.01, exceeds the fair market value of the land <br/>
<a id="pl.113.10"></a><var>113.10</var>before completion of the preparation.<br/>
<a id="pl.113.11"></a><var>113.11</var>    Subd. 2. <b>Special rules.</b> (a) If the city elects, upon the adoption of the tax increment <br/>
<a id="pl.113.12"></a><var>113.12</var>financing plan for a district, the rules under this section apply to a redevelopment district, <br/>
<a id="pl.113.13"></a><var>113.13</var>renewal and renovation district, soil condition district, or a soil deficiency district <br/>
<a id="pl.113.14"></a><var>113.14</var>established by the city or a development authority of the city in the project area.<br/>
<a id="pl.113.15"></a><var>113.15</var>    (b) Prior to or upon the adoption of the first tax increment plan subject to the special <br/>
<a id="pl.113.16"></a><var>113.16</var>rules under this subdivision, the city must find by resolution that parcels consisting of at <br/>
<a id="pl.113.17"></a><var>113.17</var>least 80 percent of the acreage of the project area (excluding street and railroad right of <br/>
<a id="pl.113.18"></a><var>113.18</var>way) are characterized by one or more of the following conditions:<br/>
<a id="pl.113.19"></a><var>113.19</var>    (1) peat or other soils with geotechnical deficiencies that impair development of <br/>
<a id="pl.113.20"></a><var>113.20</var>residential or commercial buildings or infrastructure;<br/>
<a id="pl.113.21"></a><var>113.21</var>    (2) soils or terrain that requires substantial filling in order to permit the development <br/>
<a id="pl.113.22"></a><var>113.22</var>of commercial or residential buildings or infrastructure;<br/>
<a id="pl.113.23"></a><var>113.23</var>    (3) landfills, dumps, or similar deposits of municipal or private waste;<br/>
<a id="pl.113.24"></a><var>113.24</var>    (4) quarries or similar resource extraction sites;<br/>
<a id="pl.113.25"></a><var>113.25</var>    (5) floodway; and<br/>
<a id="pl.113.26"></a><var>113.26</var>    (6) substandard buildings within the meaning of Minnesota Statutes, section <br/>
<a id="pl.113.27"></a><var>113.27</var>469.174, subdivision 10.<br/>
<a id="pl.113.28"></a><var>113.28</var>    (c) For the purposes of paragraph (b), clauses (1) through (5), a parcel is deemed to <br/>
<a id="pl.113.29"></a><var>113.29</var>be characterized by the relevant condition if at least 70 percent of the area of the parcel <br/>
<a id="pl.113.30"></a><var>113.30</var>contains the relevant condition. For the purposes of paragraph (b), clause (6), a parcel is <br/>
<a id="pl.113.31"></a><var>113.31</var>deemed to be characterized by substandard buildings if the buildings occupy at least 30 <br/>
<a id="pl.113.32"></a><var>113.32</var>percent of the area of the parcel.<br/>
<a id="pl.113.33"></a><var>113.33</var>    (d) The five-year rule under Minnesota Statutes, section 469.1763, subdivision <br/>
<a id="pl.113.34"></a><var>113.34</var>3, is extended to ten years for any district, and section 469.1763, subdivision 4, does <br/>
<a id="pl.113.35"></a><var>113.35</var>not apply to any district.<br/>
<a id="pl.114.1"></a><var>114.1</var>    (e) Notwithstanding anything to the contrary in section 469.1763, subdivision 2, <br/>
<a id="pl.114.2"></a><var>114.2</var>paragraph (a), not more than 80 percent of the total revenue derived from tax increments <br/>
<a id="pl.114.3"></a><var>114.3</var>paid by properties in any district (measured over the life of the district) may be expended <br/>
<a id="pl.114.4"></a><var>114.4</var>on activities outside the district but within the project area.<br/>
<a id="pl.114.5"></a><var>114.5</var>    (f) For a soil deficiency district:<br/>
<a id="pl.114.6"></a><var>114.6</var>    (1) increments may be collected through 20 years after the receipt by the authority of <br/>
<a id="pl.114.7"></a><var>114.7</var>the first increment from the district; and<br/>
<a id="pl.114.8"></a><var>114.8</var>    (2) except as otherwise provided in this subdivision, increments may be used only to:<br/>
<a id="pl.114.9"></a><var>114.9</var>    (i) acquire parcels on which the improvements described in item (ii) will occur;<br/>
<a id="pl.114.10"></a><var>114.10</var>    (ii) pay for the cost of correcting the unusual terrain or soil deficiencies and the <br/>
<a id="pl.114.11"></a><var>114.11</var>additional cost of installing public improvements directly caused by the deficiencies; and<br/>
<a id="pl.114.12"></a><var>114.12</var>    (iii) pay for the administrative expenses of the authority allocable to the district.<br/>
<a id="pl.114.13"></a><var>114.13</var>    (g) Increments spent for any infrastructure costs, whether inside a district or outside <br/>
<a id="pl.114.14"></a><var>114.14</var>a district but within the project area, are deemed to satisfy the requirements of paragraph <br/>
<a id="pl.114.15"></a><var>114.15</var>(f) and Minnesota Statutes, section 469.176, subdivisions 4b and 4j.<br/>
<a id="pl.114.16"></a><var>114.16</var>    (h) Increments from any district may not be used to pay the costs of landfill closure or <br/>
<a id="pl.114.17"></a><var>114.17</var>public infrastructure located on the following parcels within the plat known as Burnsville <br/>
<a id="pl.114.18"></a><var>114.18</var>Amphitheater:  Lot 1, Block 1; Lots 1 and 2, Block 2; and Outlots A, B, C and D.<br/>
<a id="pl.114.19"></a><var>114.19</var>    (i) The authority to approve tax increment financing plans to establish tax increment <br/>
<a id="pl.114.20"></a><var>114.20</var>financing districts under this section expires on December 31, 2018.<br/>
<a id="pl.114.21"></a><var>114.21</var><b>EFFECTIVE DATE.</b>This section is effective upon compliance with Minnesota <br/>
<a id="pl.114.22"></a><var>114.22</var>Statutes, section 645.021, subdivision 3.<br/>
<br/>
<a id="bill.9.22.0"></a><a id="pl.114.23"></a><var>114.23</var>    Sec. 22. <b>CITY OF EYOTA; TAX INCREMENT FINANCING DISTRICT.</b><br/>
<a id="pl.114.24"></a><var>114.24</var>    Subdivision 1. <b>Authorization.</b> Notwithstanding the mileage limitation in Minnesota <br/>
<a id="pl.114.25"></a><var>114.25</var>Statutes, section 469.174, subdivision 27, the city of Eyota is deemed to be a small city for <br/>
<a id="pl.114.26"></a><var>114.26</var>the purposes of Minnesota Statutes, section 469.174 to 469.1799, as long as its population <br/>
<a id="pl.114.27"></a><var>114.27</var>does not exceed the population limit in that section.<br/>
<a id="pl.114.28"></a><var>114.28</var>    Subd. 2. <b>Local approval.</b> This section is effective for the city of Eyota upon <br/>
<a id="pl.114.29"></a><var>114.29</var>approval of Eyota's governing body and compliance with Minnesota Statutes, section <br/>
<a id="pl.114.30"></a><var>114.30</var>645.021, subdivisions 2 and 3.<br/>
<br/>
<a id="bill.9.23.0"></a><a id="pl.114.31"></a><var>114.31</var>    Sec. 23. <b>CITY OF FRIDLEY; TAX INCREMENT FINANCING DISTRICT; </b><br/>
<a id="pl.114.32"></a><var>114.32</var><b>SPECIAL RULES.</b><br/>
<a id="pl.114.33"></a><var>114.33</var>    (a) If the city elects upon the adoption of a tax increment financing plan for a district, <br/>
<a id="pl.114.34"></a><var>114.34</var>the rules under this section apply to a redevelopment tax increment financing district <br/>
<a id="pl.115.1"></a><var>115.1</var>established by the city of Fridley or the housing and redevelopment authority of the city. <br/>
<a id="pl.115.2"></a><var>115.2</var>The redevelopment tax increment district includes the following parcels and adjacent <br/>
<a id="pl.115.3"></a><var>115.3</var>railroad property and shall be referred to as the Northstar Transit Station District: parcel <br/>
<a id="pl.115.4"></a><var>115.4</var>numbers 223024120010, 223024120009, 223024120017, 223024120016, 223024120018, <br/>
<a id="pl.115.5"></a><var>115.5</var>223024120012, 223024120011, 223024120005, 223024120004, 223024120003, <br/>
<a id="pl.115.6"></a><var>115.6</var>223024120013, 223024120008, 223024120007, 223024120006, 223024130005, <br/>
<a id="pl.115.7"></a><var>115.7</var>223024130010, 223024130011, 223024130003, 153024440039, 153024440037, <br/>
<a id="pl.115.8"></a><var>115.8</var>153024440041, 153024440042, 223024110013, 223024110016, 223024110017, <br/>
<a id="pl.115.9"></a><var>115.9</var>223024140008, 223024130002, 223024420004, 223024410002, 223024410003, <br/>
<a id="pl.115.10"></a><var>115.10</var>223024110008, 223024110007, 223024110019, 223024110018, 223024110003, <br/>
<a id="pl.115.11"></a><var>115.11</var>223024140003, 223024140009, 223024140002, 223024140010, and 223024410007.<br/>
<a id="pl.115.12"></a><var>115.12</var>    (b) The requirements for qualifying a redevelopment tax increment district under <br/>
<a id="pl.115.13"></a><var>115.13</var>Minnesota Statutes, section 469.174, subdivision 10, do not apply to the parcels located <br/>
<a id="pl.115.14"></a><var>115.14</var>within the Northstar Transit Station District, which are deemed eligible for inclusion <br/>
<a id="pl.115.15"></a><var>115.15</var>in a redevelopment tax increment district.<br/>
<a id="pl.115.16"></a><var>115.16</var>    (c) In addition to the costs permitted by Minnesota Statutes, section 469.176, <br/>
<a id="pl.115.17"></a><var>115.17</var>subdivision 4j, eligible expenditures within the Northstar Transit Station District include <br/>
<a id="pl.115.18"></a><var>115.18</var>those costs necessary to provide for the construction and land acquisition for a tunnel <br/>
<a id="pl.115.19"></a><var>115.19</var>under the Burlington Northern Santa Fe railroad tracks.<br/>
<a id="pl.115.20"></a><var>115.20</var>    (d) Notwithstanding the provisions of Minnesota Statutes, section 469.1763, <br/>
<a id="pl.115.21"></a><var>115.21</var>subdivision 2, the city of Fridley may expend increments generated from its tax increment <br/>
<a id="pl.115.22"></a><var>115.22</var>financing districts Nos. 11, 12, and 13 for costs permitted by paragraph (c) and Minnesota <br/>
<a id="pl.115.23"></a><var>115.23</var>Statutes, section 469.176, subdivision 4j, outside the boundaries of tax increment financing <br/>
<a id="pl.115.24"></a><var>115.24</var>districts Nos. 11, 12, and 13, but only within the Northstar Transit Station District.<br/>
<a id="pl.115.25"></a><var>115.25</var>    (e) The five-year rule under Minnesota Statutes, section 469.1763, subdivision 3, <br/>
<a id="pl.115.26"></a><var>115.26</var>does not apply to the Northstar Transit Station District or to tax increment financing <br/>
<a id="pl.115.27"></a><var>115.27</var>districts Nos. 11, 12, and 13.<br/>
<a id="pl.115.28"></a><var>115.28</var>    (f) The use of revenues for decertification under Minnesota Statutes, section <br/>
<a id="pl.115.29"></a><var>115.29</var>469.1763, subdivision 4, does not apply to tax increment financing districts Nos. 11, <br/>
<a id="pl.115.30"></a><var>115.30</var>12, and 13.<br/>
<a id="pl.115.31"></a><var>115.31</var><b>EFFECTIVE DATE.</b>This section is effective upon approval by the governing body <br/>
<a id="pl.115.32"></a><var>115.32</var>of the city of Fridley and upon compliance by the city with Minnesota Statutes, section <br/>
<a id="pl.115.33"></a><var>115.33</var>645.021, subdivision 3.<br/>
<br/>
<a id="bill.9.24.0"></a><a id="pl.115.34"></a><var>115.34</var>    Sec. 24. <b>CITY OF NEW BRIGHTON; TAX INCREMENT FINANCING; </b><br/>
<a id="pl.115.35"></a><var>115.35</var><b>EXPENDITURES OUTSIDE DISTRICT.</b><br/>
<a id="pl.116.1"></a><var>116.1</var>    Notwithstanding the provisions of Minnesota Statutes, section 469.1763, subdivision <br/>
<a id="pl.116.2"></a><var>116.2</var>2, the city of New Brighton may expend increments generated from its tax increment <br/>
<a id="pl.116.3"></a><var>116.3</var>financing district No. 26 to facilitate eligible activities as permitted by Minnesota Statutes, <br/>
<a id="pl.116.4"></a><var>116.4</var>section 469.176, subdivision 4e, outside the boundaries of tax increment financing district <br/>
<a id="pl.116.5"></a><var>116.5</var>No. 26, but only within the area described in Laws 1998, chapter 389, article 11, section <br/>
<a id="pl.116.6"></a><var>116.6</var>24, subdivision 1, and commonly referred to as the Northwest Quadrant. Minnesota <br/>
<a id="pl.116.7"></a><var>116.7</var>Statutes, section 469.1763, subdivisions 3 and 4, do not apply to expenditures permitted <br/>
<a id="pl.116.8"></a><var>116.8</var>by this section.<br/>
<a id="pl.116.9"></a><var>116.9</var><b>EFFECTIVE DATE.</b>This section is effective upon approval by the governing <br/>
<a id="pl.116.10"></a><var>116.10</var>body of the city of New Brighton and compliance by the city with Minnesota Statutes, <br/>
<a id="pl.116.11"></a><var>116.11</var>section 645.021, subdivision 3.<br/>
<br/>
<a id="bill.9.25.0"></a><a id="pl.116.12"></a><var>116.12</var>    Sec. 25. <b> REPEALER.</b><br/>
<a id="pl.116.13"></a><var>116.13</var>(a) Minnesota Statutes 2006, section 469.174, subdivision 29, is repealed.<br/>
<a id="pl.116.14"></a><var>116.14</var>(b) Laws 1998, chapter 389, article 11, section 18, is repealed.<br/>
<a id="pl.116.15"></a><var>116.15</var><b>EFFECTIVE DATE.</b>Paragraph (a) is effective the day following final enactment. <br/>
<a id="pl.116.16"></a><var>116.16</var>For purposes of any special law authorizing or limiting the use of increments to projects <br/>
<a id="pl.116.17"></a><var>116.17</var>meeting the requirements of a qualified housing district, expenditures for housing districts <br/>
<a id="pl.116.18"></a><var>116.18</var>satisfying the requirements of Minnesota Statutes, sections 469.174, subdivision 11; <br/>
<a id="pl.116.19"></a><var>116.19</var>469.176, subdivision 4d; and 469.1761, as amended, also satisfy the requirements of <br/>
<a id="pl.116.20"></a><var>116.20</var>the special law.<br/>
<a id="pl.116.21"></a><var>116.21</var>    Paragraph (b) is effective upon compliance with Minnesota Statutes, section <br/>
<a id="pl.116.22"></a><var>116.22</var>645.021, subdivision 3, by the governing body of the city of Burnsville. The balance of <br/>
<a id="pl.116.23"></a><var>116.23</var>tax increments derived from tax increment financing district No. 2-1 as of the effective <br/>
<a id="pl.116.24"></a><var>116.24</var>date of this section must be returned to the county for distribution in accordance with <br/>
<a id="pl.116.25"></a><var>116.25</var>Minnesota Statutes, section 469.176, subdivision 2.<br/>
<br/>
<a id="bill.10.0.0"></a>

<a id="bill.10.1.0"></a><a id="pl.116.28"></a><var>116.28</var>    Section 1. Minnesota Statutes 2006, section 118A.03, subdivision 3, is amended to read:<br/>
<a id="pl.116.29"></a><var>116.29</var>    Subd. 3. <b>Amount.</b> The total amount of the collateral computed at its market value <br/>
<a id="pl.116.30"></a><var>116.30</var>shall be at least ten percent more than the amount on deposit plus accrued interest at <br/>
<a id="pl.116.31"></a><var>116.31</var>the close of the financial institution's banking day, except that where the collateral is <br/>
<a id="pl.116.32"></a><var>116.32</var>irrevocable standby letters of credit issued by Federal Home Loan Banks, the amount of <br/>
<a id="pl.116.33"></a><var>116.33</var>collateral shall be at least equal to the amount on deposit plus accrued interest at the close <br/>
<a id="pl.117.1"></a><var>117.1</var>of the financial institution's banking day. The financial institution may furnish both a <br/>
<a id="pl.117.2"></a><var>117.2</var>surety bond and collateral aggregating the required amount.<br/>
<br/>
<a id="bill.10.2.0"></a><a id="pl.117.3"></a><var>117.3</var>    Sec. 2. Minnesota Statutes 2006, section 123B.61, is amended to read:<br/>
<a id="pl.117.4"></a><var>117.4</var><b>123B.61 PURCHASE OF CERTAIN EQUIPMENT.</b><br/>
<a id="pl.117.5"></a><var>117.5</var>    The board of a district may issue general obligation certificates of indebtedness <br/>
<a id="pl.117.6"></a><var>117.6</var>or capital notes subject to the district debt limits to: (a) purchase vehicles, computers, <br/>
<a id="pl.117.7"></a><var>117.7</var>telephone systems, cable equipment, photocopy and office equipment, technological <br/>
<a id="pl.117.8"></a><var>117.8</var>equipment for instruction, and other capital equipment having an expected useful life at <br/>
<a id="pl.117.9"></a><var>117.9</var>least as long as the terms of the certificates or notes; (b) purchase computer hardware and <br/>
<a id="pl.117.10"></a><var>117.10</var>software, without regard to its expected useful life, whether bundled with machinery or <br/>
<a id="pl.117.11"></a><var>117.11</var>equipment or unbundled, together with application development services and training <br/>
<a id="pl.117.12"></a><var>117.12</var>related to the use of the computer; and (c) prepay special assessments. The certificates or <br/>
<a id="pl.117.13"></a><var>117.13</var>notes must be payable in not more than five ten years and must be issued on the terms <br/>
<a id="pl.117.14"></a><var>117.14</var>and in the manner determined by the board, except that certificates or notes issued to <br/>
<a id="pl.117.15"></a><var>117.15</var>prepay special assessments must be payable in not more than 20 years. The certificates <br/>
<a id="pl.117.16"></a><var>117.16</var>or notes may be issued by resolution and without the requirement for an election. The <br/>
<a id="pl.117.17"></a><var>117.17</var>certificates or notes are general obligation bonds for purposes of section 
         <statute_ref>126C.55</statute_ref>. A tax <br/>
<a id="pl.117.18"></a><var>117.18</var>levy must be made for the payment of the principal and interest on the certificates or <br/>
<a id="pl.117.19"></a><var>117.19</var>notes, in accordance with section 
         <statute_ref>475.61</statute_ref>, as in the case of bonds. The sum of the tax <br/>
<a id="pl.117.20"></a><var>117.20</var>levies under this section and section 
         <statute_ref>123B.62</statute_ref> for each year must not exceed the lesser <br/>
<a id="pl.117.21"></a><var>117.21</var>of the amount of the district's total operating capital revenue or the sum of the district's <br/>
<a id="pl.117.22"></a><var>117.22</var>levy in the general and community service funds excluding the adjustments under this <br/>
<a id="pl.117.23"></a><var>117.23</var>section for the year preceding the year the initial debt service levies are certified. The <br/>
<a id="pl.117.24"></a><var>117.24</var>district's general fund levy for each year must be reduced by the sum of (1) the amount <br/>
<a id="pl.117.25"></a><var>117.25</var>of the tax levies for debt service certified for each year for payment of the principal and <br/>
<a id="pl.117.26"></a><var>117.26</var>interest on the certificates or notes issued under this section as required by section 
         <statute_ref>475.61</statute_ref>, <br/>
<a id="pl.117.27"></a><var>117.27</var>(2) the amount of the tax levies for debt service certified for each year for payment of the <br/>
<a id="pl.117.28"></a><var>117.28</var>principal and interest on bonds issued under section 
         <statute_ref>123B.62</statute_ref>, and (3) any excess amount <br/>
<a id="pl.117.29"></a><var>117.29</var>in the debt redemption fund used to retire bonds, certificates, or notes issued under this <br/>
<a id="pl.117.30"></a><var>117.30</var>section or section 
         <statute_ref>123B.62</statute_ref> after April 1, 1997, other than amounts used to pay capitalized <br/>
<a id="pl.117.31"></a><var>117.31</var>interest. If the district's general fund levy is less than the amount of the reduction, the <br/>
<a id="pl.117.32"></a><var>117.32</var>balance shall be deducted first from the district's community service fund levy, and next <br/>
<a id="pl.117.33"></a><var>117.33</var>from the district's general fund or community service fund levies for the following year. A <br/>
<a id="pl.117.34"></a><var>117.34</var>district using an excess amount in the debt redemption fund to retire the certificates or <br/>
<a id="pl.117.35"></a><var>117.35</var>notes shall report the amount used for this purpose to the commissioner by July 15 of the <br/>
<a id="pl.118.1"></a><var>118.1</var>following fiscal year. A district having an outstanding capital loan under section 
         <statute_ref>126C.69</statute_ref> <br/>
<a id="pl.118.2"></a><var>118.2</var>or an outstanding debt service loan under section 
         <statute_ref>126C.68</statute_ref> must not use an excess amount <br/>
<a id="pl.118.3"></a><var>118.3</var>in the debt redemption fund to retire the certificates or notes. <br/>
<br/>
<a id="bill.10.3.0"></a><a id="pl.118.4"></a><var>118.4</var>    Sec. 3. Minnesota Statutes 2006, section 275.61, subdivision 1, is amended to read:<br/>
<a id="pl.118.5"></a><var>118.5</var>    Subdivision 1. <b>Market value.</b> (a) For local governmental subdivisions other than <br/>
<a id="pl.118.6"></a><var>118.6</var>school districts, any levy, including the issuance of debt obligations payable in whole or in <br/>
<a id="pl.118.7"></a><var>118.7</var>part from property taxes, required to be approved and approved by the voters at a general <br/>
<a id="pl.118.8"></a><var>118.8</var>or special election for taxes payable in 1993 and thereafter, shall be levied against the <br/>
<a id="pl.118.9"></a><var>118.9</var>referendum market value of all taxable property within the governmental subdivision, as <br/>
<a id="pl.118.10"></a><var>118.10</var>defined in section 
         <statute_ref>126C.01, subdivision 3</statute_ref>. Any levy amount subject to the requirements of <br/>
<a id="pl.118.11"></a><var>118.11</var>this section shall be certified separately to the county auditor under section 
         <statute_ref>275.07</statute_ref>. <br/>
<a id="pl.118.12"></a><var>118.12</var>    (b) The ballot shall state the maximum amount of the increased levy as a percentage <br/>
<a id="pl.118.13"></a><var>118.13</var>of market value and the amount that will be raised by the new referendum tax rate in the <br/>
<a id="pl.118.14"></a><var>118.14</var>first year it is to be levied.<br/>
<a id="pl.118.15"></a><var>118.15</var>    (c) This subdivision does not apply to tax levies for the payment of debt obligations <br/>
<a id="pl.118.16"></a><var>118.16</var>that are approved by the voters after June 30, 2008.<br/>
<a id="pl.118.17"></a><var>118.17</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.10.4.0"></a><a id="pl.118.18"></a><var>118.18</var>    Sec. 4. Minnesota Statutes 2006, section 331A.05, subdivision 2, is amended to read:<br/>
<a id="pl.118.19"></a><var>118.19</var>    Subd. 2. <b>Time of notice.</b> Unless otherwise specified by a particular statute law, or <br/>
<a id="pl.118.20"></a><var>118.20</var>by order of a court, publication of a public notice shall be as follows:<br/>
<a id="pl.118.21"></a><var>118.21</var>    (a) the notice shall be published once;<br/>
<a id="pl.118.22"></a><var>118.22</var>    (b) if the notice is intended to inform the public about a future event, the last <br/>
<a id="pl.118.23"></a><var>118.23</var>publication shall occur not more than 14 30 days and not less than seven days before <br/>
<a id="pl.118.24"></a><var>118.24</var>the event;<br/>
<a id="pl.118.25"></a><var>118.25</var>    (c) if the notice is intended to inform the public about a past action or event, the last <br/>
<a id="pl.118.26"></a><var>118.26</var>publication shall occur not more than 45 days after occurrence of the action or event.<br/>
<br/>
<a id="bill.10.5.0"></a><a id="pl.118.27"></a><var>118.27</var>    Sec. 5. Minnesota Statutes 2006, section 365A.02, is amended to read:<br/>
<a id="pl.118.28"></a><var>118.28</var><b>365A.02 </b><b>DEFINITION</b><b> DEFINITIONS</b><b>.</b><br/>
<a id="pl.118.29"></a><var>118.29</var>    Subdivision 1. <b>Subordinate service district.</b> "Subordinate service district" means a <br/>
<a id="pl.118.30"></a><var>118.30</var>defined area within the town in which one or more governmental services or additions to <br/>
<a id="pl.118.31"></a><var>118.31</var>townwide special services are provided by the town specially for the area and financed <br/>
<a id="pl.119.1"></a><var>119.1</var>from revenues from the area. The boundaries of a single subordinate service district <br/>
<a id="pl.119.2"></a><var>119.2</var>may not embrace an entire town.<br/>
<a id="pl.119.3"></a><var>119.3</var>    Subd. 2. <b>Special services.</b> "Special services" means one or more governmental <br/>
<a id="pl.119.4"></a><var>119.4</var>services or additions to townwide services provided by the town specially for the area <br/>
<a id="pl.119.5"></a><var>119.5</var>and financed from revenues from the area.<br/>
<br/>
<a id="bill.10.6.0"></a><a id="pl.119.6"></a><var>119.6</var>    Sec. 6. Minnesota Statutes 2006, section 365A.04, is amended to read:<br/>
<a id="pl.119.7"></a><var>119.7</var><b>365A.04 CREATION </b><b>BY PETITION</b><b>.</b><br/>
<a id="pl.119.8"></a><var>119.8</var>    Subdivision 1. <b>Petition.</b> A petition signed by at least 50 percent of the property <br/>
<a id="pl.119.9"></a><var>119.9</var>owners in the part of the town proposed for the subordinate service district may be <br/>
<a id="pl.119.10"></a><var>119.10</var>submitted to the town board requesting the establishment of a subordinate service district <br/>
<a id="pl.119.11"></a><var>119.11</var>to provide a service that the town is otherwise authorized by law to provide. The petition <br/>
<a id="pl.119.12"></a><var>119.12</var>must include the territorial boundaries of the proposed district and specify the kinds of <br/>
<a id="pl.119.13"></a><var>119.13</var>services to be provided within the district.<br/>
<a id="pl.119.14"></a><var>119.14</var>    Subd. 2. <b>Public hearing.</b> Upon receipt of the petition, and the verification of the <br/>
<a id="pl.119.15"></a><var>119.15</var>signatures by the town clerk, the town board shall, within 30 days following verification, <br/>
<a id="pl.119.16"></a><var>119.16</var>hold a public hearing on the question of whether or not the requested district shall be <br/>
<a id="pl.119.17"></a><var>119.17</var>established. The notice of public hearing must specify the special services to be provided <br/>
<a id="pl.119.18"></a><var>119.18</var>within the subordinate service district and must specify the territorial boundaries of the <br/>
<a id="pl.119.19"></a><var>119.19</var>requested district. The notice of public hearing must be published once in a newspaper of <br/>
<a id="pl.119.20"></a><var>119.20</var>general circulation in the town at least 14 days prior to the date of the public hearing.<br/>
<a id="pl.119.21"></a><var>119.21</var>    Subd. 3. <b>Approval; disapproval.</b> Within 30 days after the public hearing, the <br/>
<a id="pl.119.22"></a><var>119.22</var>town board by resolution shall approve or disapprove the establishment of the requested <br/>
<a id="pl.119.23"></a><var>119.23</var>district. An approving resolution must specify the special services to be provided within <br/>
<a id="pl.119.24"></a><var>119.24</var>the subordinate service district and must specify the territorial boundaries of the district. <br/>
<a id="pl.119.25"></a><var>119.25</var>A resolution approving the establishment of the district may contain amendments or <br/>
<a id="pl.119.26"></a><var>119.26</var>modifications of the district's boundaries or functions as set forth in the petition.<br/>
<br/>
<a id="bill.10.7.0"></a><a id="pl.119.27"></a><var>119.27</var>    Sec. 7. Minnesota Statutes 2006, section 365A.08, is amended to read:<br/>
<a id="pl.119.28"></a><var>119.28</var><b>365A.08 FINANCING.</b><br/>
<a id="pl.119.29"></a><var>119.29</var>    Subdivision 1. <b>Budget.</b> (a) Upon adoption of the next annual budget following <br/>
<a id="pl.119.30"></a><var>119.30</var>the creation of a subordinate service district the town board shall include in the budget <br/>
<a id="pl.119.31"></a><var>119.31</var>appropriate provisions for the operation of the district including either a property tax <br/>
<a id="pl.119.32"></a><var>119.32</var>levied only on property of the users of the service within the boundaries of the district <br/>
<a id="pl.119.33"></a><var>119.33</var>or a levy of a service charge against the users of the service within the district, or a <br/>
<a id="pl.119.34"></a><var>119.34</var>combination of a property tax and a service charge on the users of the service.<br/>
<a id="pl.120.1"></a><var>120.1</var>    (b) A tax or service charge or a combination of them may be imposed to finance a <br/>
<a id="pl.120.2"></a><var>120.2</var>function or service in the district that the town ordinarily provides throughout the town <br/>
<a id="pl.120.3"></a><var>120.3</var>only to the extent that there is an increase in the level of the function or service provided <br/>
<a id="pl.120.4"></a><var>120.4</var>in the service district over that provided throughout the town. In that case, in addition <br/>
<a id="pl.120.5"></a><var>120.5</var>to the townwide tax levy, an amount necessary to pay for the increase in the level of the <br/>
<a id="pl.120.6"></a><var>120.6</var>function or service may be imposed in the district.<br/>
<a id="pl.120.7"></a><var>120.7</var>    Subd. 2. <b>Bonds.</b> At any time after the requirements of section 356A.06 have been <br/>
<a id="pl.120.8"></a><var>120.8</var>met and the subordinate service district created, the town board may issue obligations <br/>
<a id="pl.120.9"></a><var>120.9</var>in an amount it deems necessary to defray in whole or in part the expense incurred <br/>
<a id="pl.120.10"></a><var>120.10</var>and estimated to be incurred in making capital improvements necessary to operate the <br/>
<a id="pl.120.11"></a><var>120.11</var>subordinate service district and provide the special services in the district, including every <br/>
<a id="pl.120.12"></a><var>120.12</var>item of cost from inception to completion and all fees and expenses incurred in connection <br/>
<a id="pl.120.13"></a><var>120.13</var>with the capital improvements or the financing. The obligations are payable primarily <br/>
<a id="pl.120.14"></a><var>120.14</var>out of the proceeds of the taxes and service charges imposed under subdivision 1, net <br/>
<a id="pl.120.15"></a><var>120.15</var>revenues as described in section 444.075, and special assessments under chapter 429. The <br/>
<a id="pl.120.16"></a><var>120.16</var>town board may by resolution pledge the full faith credit and taxing power of the town <br/>
<a id="pl.120.17"></a><var>120.17</var>to ensure payment of the principal and interest on the obligations if the proceeds of the <br/>
<a id="pl.120.18"></a><var>120.18</var>taxes and service charges are insufficient to pay the principal and interest. Obligations <br/>
<a id="pl.120.19"></a><var>120.19</var>must be issued in accordance with chapter 475, except that an election is not required, and <br/>
<a id="pl.120.20"></a><var>120.20</var>the amount of the obligations is not included in determining the net indebtedness of the <br/>
<a id="pl.120.21"></a><var>120.21</var>town under the provisions of any law limiting indebtedness.<br/>
<a id="pl.120.22"></a><var>120.22</var>    Subd. 3. <b>Covenants to secure obligations.</b> In resolutions authorizing the issuance <br/>
<a id="pl.120.23"></a><var>120.23</var>of general or special obligations and pledging taxes and service charges imposed under <br/>
<a id="pl.120.24"></a><var>120.24</var>subdivision 1, net revenues, or special assessments to their payment, the town board <br/>
<a id="pl.120.25"></a><var>120.25</var>may make covenants for the protection of holders of the obligations and taxpayers of the <br/>
<a id="pl.120.26"></a><var>120.26</var>town as it deems necessary, including a covenant that the town will impose and collect <br/>
<a id="pl.120.27"></a><var>120.27</var>charges of the nature authorized by this chapter at the time and in the amounts required to <br/>
<a id="pl.120.28"></a><var>120.28</var>produce, together with any taxes or special assessments designated as a primary source <br/>
<a id="pl.120.29"></a><var>120.29</var>of payment of the obligations, funds adequate to pay all principal and interest when due <br/>
<a id="pl.120.30"></a><var>120.30</var>on the obligations, and to create and maintain reserves securing the payments as may be <br/>
<a id="pl.120.31"></a><var>120.31</var>provided in the resolutions.<br/>
<br/>
<a id="bill.10.8.0"></a><a id="pl.120.32"></a><var>120.32</var>    Sec. 8. Minnesota Statutes 2006, section 365A.095, is amended to read:<br/>
<a id="pl.120.33"></a><var>120.33</var><b>365A.095 PETITION FOR REMOVAL OF DISTRICT; PROCEDURE.</b><br/>
<a id="pl.120.34"></a><var>120.34</var>    Subdivision 1. <b>Petition.</b> A petition signed by at least 75 percent of the property <br/>
<a id="pl.120.35"></a><var>120.35</var>owners in the territory of the subordinate service district requesting the removal of the <br/>
<a id="pl.121.1"></a><var>121.1</var>district may be presented to the town board. Within 30 days after the town board receives <br/>
<a id="pl.121.2"></a><var>121.2</var>the petition, the town clerk shall determine the validity of the signatures on the petition. If <br/>
<a id="pl.121.3"></a><var>121.3</var>the requisite number of signatures are certified as valid, the town board must hold a public <br/>
<a id="pl.121.4"></a><var>121.4</var>hearing on the petitioned matter. Within 30 days after the end of the hearing, the town <br/>
<a id="pl.121.5"></a><var>121.5</var>board must decide whether to discontinue the subordinate service district, continue as it is, <br/>
<a id="pl.121.6"></a><var>121.6</var>or take some other action with respect to it.<br/>
<a id="pl.121.7"></a><var>121.7</var>    Subd. 2. <b>Bonds.</b> If obligations have been issued for the benefit of the subordinate <br/>
<a id="pl.121.8"></a><var>121.8</var>service district, the rates, charges, and tax levies, if any, continue until the obligations and <br/>
<a id="pl.121.9"></a><var>121.9</var>any obligations issued to refund them have been paid in full.<br/>
<br/>
<a id="bill.10.9.0"></a><a id="pl.121.10"></a><var>121.10</var>    Sec. 9. Minnesota Statutes 2006, section 373.01, subdivision 3, is amended to read:<br/>
<a id="pl.121.11"></a><var>121.11</var>    Subd. 3. <b>Capital notes.</b> (a) A county board may, by resolution and without <br/>
<a id="pl.121.12"></a><var>121.12</var>referendum, issue capital notes subject to the county debt limit to purchase capital <br/>
<a id="pl.121.13"></a><var>121.13</var>equipment useful for county purposes that has an expected useful life at least equal to the <br/>
<a id="pl.121.14"></a><var>121.14</var>term of the notes. The notes shall be payable in not more than ten years and shall be <br/>
<a id="pl.121.15"></a><var>121.15</var>issued on terms and in a manner the board determines. A tax levy shall be made for <br/>
<a id="pl.121.16"></a><var>121.16</var>payment of the principal and interest on the notes, in accordance with section 
         <statute_ref>475.61</statute_ref>, <br/>
<a id="pl.121.17"></a><var>121.17</var>as in the case of bonds.<br/>
<a id="pl.121.18"></a><var>121.18</var>    (b) For purposes of this subdivision, "capital equipment" means:<br/>
<a id="pl.121.19"></a><var>121.19</var>    (1) public safety, ambulance, road construction or maintenance, and medical <br/>
<a id="pl.121.20"></a><var>121.20</var>equipment; and<br/>
<a id="pl.121.21"></a><var>121.21</var>    (2) computer hardware and software, whether bundled with machinery or equipment <br/>
<a id="pl.121.22"></a><var>121.22</var>or unbundled. The authority to issue capital notes for software expires on July 1, 2007.<br/>
<br/>
<a id="bill.10.10.0"></a><a id="pl.121.23"></a><var>121.23</var>    Sec. 10. Minnesota Statutes 2006, section 373.40, subdivision 4, is amended to read:<br/>
<a id="pl.121.24"></a><var>121.24</var>    Subd. 4. <b>Limitations on amount.</b> A county, other than Ramsey, may not issue <br/>
<a id="pl.121.25"></a><var>121.25</var>bonds under this section if the maximum amount of principal and interest to become due in <br/>
<a id="pl.121.26"></a><var>121.26</var>any year on all the outstanding bonds issued pursuant to this section (including the bonds <br/>
<a id="pl.121.27"></a><var>121.27</var>to be issued) will equal or exceed 0.05367 0.12 percent of taxable market value of property <br/>
<a id="pl.121.28"></a><var>121.28</var>in the county. Ramsey county may not issue bonds under this section if the maximum <br/>
<a id="pl.121.29"></a><var>121.29</var>amount of principal and interest to become due in any year on all the outstanding bonds <br/>
<a id="pl.121.30"></a><var>121.30</var>issued pursuant to this section (including the bonds to be issued) will equal or exceed <br/>
<a id="pl.121.31"></a><var>121.31</var>0.06455 percent of taxable market value of property in the county. Calculation of the <br/>
<a id="pl.121.32"></a><var>121.32</var>limit must be made using the taxable market value for the taxes payable year in which <br/>
<a id="pl.121.33"></a><var>121.33</var>the obligations are issued and sold. This section does not limit the authority to issue <br/>
<a id="pl.121.34"></a><var>121.34</var>bonds under any other special or general law.<br/>
<a id="pl.122.1"></a><var>122.1</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.10.11.0"></a><a id="pl.122.2"></a><var>122.2</var>    Sec. 11. Minnesota Statutes 2006, section 375B.09, is amended to read:<br/>
<a id="pl.122.3"></a><var>122.3</var><b>375B.09 FINANCING.</b><br/>
<a id="pl.122.4"></a><var>122.4</var>    Subdivision 1. <b>Budget.</b> (a) Upon adoption of the next annual budget following the <br/>
<a id="pl.122.5"></a><var>122.5</var>creation of a subordinate service district the county board shall include in the budget <br/>
<a id="pl.122.6"></a><var>122.6</var>appropriate provisions for the operation of the district including, as appropriate, either a <br/>
<a id="pl.122.7"></a><var>122.7</var>property tax levied only on property within the boundaries of the district or a levy of a <br/>
<a id="pl.122.8"></a><var>122.8</var>service charge against the users of the service within the district, or any combination of a <br/>
<a id="pl.122.9"></a><var>122.9</var>property tax and a service charge.<br/>
<a id="pl.122.10"></a><var>122.10</var>    (b) A tax or service charge or a combination thereof shall not be imposed to finance a <br/>
<a id="pl.122.11"></a><var>122.11</var>function or service in the subordinate service district which the county generally provides <br/>
<a id="pl.122.12"></a><var>122.12</var>throughout the county unless an increase in the level of the service is to be supplied in the <br/>
<a id="pl.122.13"></a><var>122.13</var>subordinate service district in which case, in addition to the countywide tax levy, only an <br/>
<a id="pl.122.14"></a><var>122.14</var>amount necessary to pay for the increased level of service may be imposed.<br/>
<a id="pl.122.15"></a><var>122.15</var>    Subd. 2. <b>Bonds.</b> At any time after the requirements of section 375B.07 have been <br/>
<a id="pl.122.16"></a><var>122.16</var>met and the subordinate service district created, the county board may issue obligations <br/>
<a id="pl.122.17"></a><var>122.17</var>in an amount it deems necessary to defray in whole or in part the expense incurred <br/>
<a id="pl.122.18"></a><var>122.18</var>and estimated to be incurred in making capital improvements necessary to operate the <br/>
<a id="pl.122.19"></a><var>122.19</var>subordinate service district and provide the special services in the district, including every <br/>
<a id="pl.122.20"></a><var>122.20</var>item of cost from inception to completion and all fees and expenses incurred in connection <br/>
<a id="pl.122.21"></a><var>122.21</var>with the capital improvements or the financing. The obligations shall be payable primarily <br/>
<a id="pl.122.22"></a><var>122.22</var>out of the proceeds of the taxes and service charges imposed pursuant to subdivision 1, net <br/>
<a id="pl.122.23"></a><var>122.23</var>revenues as described in section 444.075, and special assessments under chapter 429. The <br/>
<a id="pl.122.24"></a><var>122.24</var>county board may by resolution pledge the full faith credit and taxing power of the county <br/>
<a id="pl.122.25"></a><var>122.25</var>to ensure payment of the principal and interest on the obligations if the proceeds of the <br/>
<a id="pl.122.26"></a><var>122.26</var>taxes and service charges are insufficient to pay the principal and interest. Obligations <br/>
<a id="pl.122.27"></a><var>122.27</var>must be issued in accordance with chapter 475, except that an election is not required, and <br/>
<a id="pl.122.28"></a><var>122.28</var>the amount of the obligations is not included in determining the net indebtedness of the <br/>
<a id="pl.122.29"></a><var>122.29</var>county under the provisions of any law limiting indebtedness.<br/>
<a id="pl.122.30"></a><var>122.30</var>    Subd. 3. <b>Covenants to secure obligations.</b> In resolutions authorizing the issuance <br/>
<a id="pl.122.31"></a><var>122.31</var>of general or special obligations and pledging taxes and service charges imposed under <br/>
<a id="pl.122.32"></a><var>122.32</var>subdivision 1, net revenues, or special assessments to their payment, the county board <br/>
<a id="pl.122.33"></a><var>122.33</var>may make covenants for the protection of holders of the obligations and taxpayers of the <br/>
<a id="pl.122.34"></a><var>122.34</var>county as it deems necessary, including a covenant that the county will impose and collect <br/>
<a id="pl.122.35"></a><var>122.35</var>charges of the nature authorized by this chapter at the time and in the amounts required to <br/>
<a id="pl.123.1"></a><var>123.1</var>produce, together with any taxes or special assessments designated as a primary source <br/>
<a id="pl.123.2"></a><var>123.2</var>of payment of the obligations, funds adequate to pay all principal and interest when due <br/>
<a id="pl.123.3"></a><var>123.3</var>on the obligations and to create and maintain reserves securing the payments as may be <br/>
<a id="pl.123.4"></a><var>123.4</var>provided in the resolutions.<br/>
<a id="pl.123.5"></a><var>123.5</var>    Subd. 4. <b>Continuance in the event of withdrawal.</b> If obligations have been issued <br/>
<a id="pl.123.6"></a><var>123.6</var>for the benefit of the subordinate service district, and the district is withdrawn or removed <br/>
<a id="pl.123.7"></a><var>123.7</var>pursuant to either section 375B.10 or 375B.11, the rates, charges, and tax levies, if any, in <br/>
<a id="pl.123.8"></a><var>123.8</var>the withdrawn or removed district must continue until the obligations and any obligations <br/>
<a id="pl.123.9"></a><var>123.9</var>issued to refund them have been paid in full.<br/>
<a id="pl.123.10"></a><var>123.10</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.10.12.0"></a><a id="pl.123.11"></a><var>123.11</var>    Sec. 12. Minnesota Statutes 2006, section 383B.117, subdivision 2, is amended to read:<br/>
<a id="pl.123.12"></a><var>123.12</var>    Subd. 2. <b>Equipment acquisition; capital notes.</b> The board may, by resolution and <br/>
<a id="pl.123.13"></a><var>123.13</var>without public referendum, issue capital notes within existing debt limits for the purpose <br/>
<a id="pl.123.14"></a><var>123.14</var>of purchasing ambulance and other medical equipment, road construction or maintenance <br/>
<a id="pl.123.15"></a><var>123.15</var>equipment, public safety equipment and other capital equipment having an expected <br/>
<a id="pl.123.16"></a><var>123.16</var>useful life at least equal to the term of the notes issued. The notes shall be payable in <br/>
<a id="pl.123.17"></a><var>123.17</var>not more than five ten years and shall be issued on terms and in a manner as the board <br/>
<a id="pl.123.18"></a><var>123.18</var>determines. The total principal amount of the notes issued for any fiscal year shall not <br/>
<a id="pl.123.19"></a><var>123.19</var>exceed one percent of the total annual budget for that year and shall be issued solely for <br/>
<a id="pl.123.20"></a><var>123.20</var>the purchases authorized in this subdivision. A tax levy shall be made for the payment <br/>
<a id="pl.123.21"></a><var>123.21</var>of the principal and interest on such notes as in the case of bonds. For purposes of this <br/>
<a id="pl.123.22"></a><var>123.22</var>subdivision, "equipment" includes computer hardware and software, whether bundled with <br/>
<a id="pl.123.23"></a><var>123.23</var>machinery or equipment or unbundled. For purposes of this subdivision, the term "medical <br/>
<a id="pl.123.24"></a><var>123.24</var>equipment" includes computer hardware and software and other intellectual property for <br/>
<a id="pl.123.25"></a><var>123.25</var>use in medical diagnosis, medical procedures, research, record keeping, billing, and other <br/>
<a id="pl.123.26"></a><var>123.26</var>hospital applications, together with application development services and training related <br/>
<a id="pl.123.27"></a><var>123.27</var>to the use of the computer hardware and software and other intellectual property, all <br/>
<a id="pl.123.28"></a><var>123.28</var>without regard to their useful life. For purposes of determining the amount of capital notes <br/>
<a id="pl.123.29"></a><var>123.29</var>which the county may issue in any year, the budget of the county and Hennepin Healthcare <br/>
<a id="pl.123.30"></a><var>123.30</var>System, Inc. shall be combined and the notes issuable under this subdivision shall be in <br/>
<a id="pl.123.31"></a><var>123.31</var>addition to obligations issuable under section 
         <statute_ref>373.01, subdivision 3</statute_ref>.<br/>
<a id="pl.123.32"></a><var>123.32</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.10.13.0"></a><a id="pl.123.33"></a><var>123.33</var>    Sec. 13. Minnesota Statutes 2006, section 383B.77, subdivision 1, is amended to read:<br/>
<a id="pl.124.1"></a><var>124.1</var>    Subdivision 1. <b>Creation.</b> The Hennepin County Housing and Redevelopment <br/>
<a id="pl.124.2"></a><var>124.2</var>Authority is created in the county of Hennepin. It shall have all of the powers and duties <br/>
<a id="pl.124.3"></a><var>124.3</var>of a housing and redevelopment authority under sections 
         <statute_ref>469.001</statute_ref> to 
         <statute_ref>469.047</statute_ref>. For the <br/>
<a id="pl.124.4"></a><var>124.4</var>purposes of applying the municipal housing and redevelopment act to Hennepin County, <br/>
<a id="pl.124.5"></a><var>124.5</var>the county has all of the powers and duties of a city, the county board has all the powers <br/>
<a id="pl.124.6"></a><var>124.6</var>and duties of a governing body, the chair of the county board has all of the powers and <br/>
<a id="pl.124.7"></a><var>124.7</var>duties of a mayor, and, notwithstanding section 469.008, the area of operation includes the <br/>
<a id="pl.124.8"></a><var>124.8</var>area within the territorial boundaries of the county. <br/>
<a id="pl.124.9"></a><var>124.9</var><b>EFFECTIVE DATE.</b>Because the population of Hennepin County is more than <br/>
<a id="pl.124.10"></a><var>124.10</var>1,000,000, under Minnesota Statutes, section 645.023, this section is effective without <br/>
<a id="pl.124.11"></a><var>124.11</var>local approval.<br/>
<br/>
<a id="bill.10.14.0"></a><a id="pl.124.12"></a><var>124.12</var>    Sec. 14. Minnesota Statutes 2006, section 383B.77, subdivision 2, is amended to read:<br/>
<a id="pl.124.13"></a><var>124.13</var>    Subd. 2. <b>Limitation.</b> This section does not limit or restrict any existing housing <br/>
<a id="pl.124.14"></a><var>124.14</var>and redevelopment authority or prevent a municipality from creating an authority. For <br/>
<a id="pl.124.15"></a><var>124.15</var>purposes of this subdivision, "housing and redevelopment authority" includes any <br/>
<a id="pl.124.16"></a><var>124.16</var>municipal department, agency, or authority of the city of Minneapolis which exercises the <br/>
<a id="pl.124.17"></a><var>124.17</var>powers of a housing and redevelopment authority pursuant to section 
         <statute_ref>469.003</statute_ref> or other <br/>
<a id="pl.124.18"></a><var>124.18</var>law. The county authority shall notify a municipal authority by January 31 of each year <br/>
<a id="pl.124.19"></a><var>124.19</var>as to the activities the county authority plans to participate in within the municipality. <br/>
<a id="pl.124.20"></a><var>124.20</var>The municipal authority shall notify the county authority within 45 days of the date of <br/>
<a id="pl.124.21"></a><var>124.21</var>the notice from the county authority, if the municipal authority does not consent to the <br/>
<a id="pl.124.22"></a><var>124.22</var>activities of the county authority. The county authority shall not exercise its powers in a <br/>
<a id="pl.124.23"></a><var>124.23</var>municipality where a housing and redevelopment authority was created under Minnesota <br/>
<a id="pl.124.24"></a><var>124.24</var>Statutes 1969, chapter 462, before June 8, 1971, except as provided in this subdivision. If a <br/>
<a id="pl.124.25"></a><var>124.25</var>city housing and redevelopment authority requests the county housing and redevelopment <br/>
<a id="pl.124.26"></a><var>124.26</var>authority to exercise any power or perform any function of the municipal authority, the <br/>
<a id="pl.124.27"></a><var>124.27</var>county authority may do so. <br/>
<a id="pl.124.28"></a><var>124.28</var><b>EFFECTIVE DATE.</b>Because the population of Hennepin County is more than <br/>
<a id="pl.124.29"></a><var>124.29</var>1,000,000, under Minnesota Statutes, section 645.023, this section is effective without <br/>
<a id="pl.124.30"></a><var>124.30</var>local approval.<br/>
<br/>
<a id="bill.10.15.0"></a><a id="pl.124.31"></a><var>124.31</var>    Sec. 15. Minnesota Statutes 2006, section 410.32, is amended to read:<br/>
<a id="pl.124.32"></a><var>124.32</var><b>410.32 CITIES MAY ISSUE CAPITAL NOTES FOR CAPITAL EQUIPMENT.</b><br/>
<a id="pl.125.1"></a><var>125.1</var>    (a) Notwithstanding any contrary provision of other law or charter, a home rule <br/>
<a id="pl.125.2"></a><var>125.2</var>charter city may, by resolution and without public referendum, issue capital notes subject <br/>
<a id="pl.125.3"></a><var>125.3</var>to the city debt limit to purchase capital equipment.<br/>
<a id="pl.125.4"></a><var>125.4</var>    (b) For purposes of this section, "capital equipment" means:<br/>
<a id="pl.125.5"></a><var>125.5</var>    (1) public safety equipment, ambulance and other medical equipment, road <br/>
<a id="pl.125.6"></a><var>125.6</var>construction and maintenance equipment, and other capital equipment; and<br/>
<a id="pl.125.7"></a><var>125.7</var>    (2) computer hardware and software, whether bundled with machinery or equipment <br/>
<a id="pl.125.8"></a><var>125.8</var>or unbundled.<br/>
<a id="pl.125.9"></a><var>125.9</var>    (c) The equipment or software must have an expected useful life at least as long as the <br/>
<a id="pl.125.10"></a><var>125.10</var>term of the notes. The authority to issue capital notes for software expires on July 1, 2007.<br/>
<a id="pl.125.11"></a><var>125.11</var>    (d) The notes shall be payable in not more than ten years and be issued on terms and <br/>
<a id="pl.125.12"></a><var>125.12</var>in the manner the city determines. The total principal amount of the capital notes issued <br/>
<a id="pl.125.13"></a><var>125.13</var>in a fiscal year shall not exceed 0.03 percent of the market value of taxable property <br/>
<a id="pl.125.14"></a><var>125.14</var>in the city for that year.<br/>
<a id="pl.125.15"></a><var>125.15</var>    (e) A tax levy shall be made for the payment of the principal and interest on the <br/>
<a id="pl.125.16"></a><var>125.16</var>notes, in accordance with section 
         <statute_ref>475.61</statute_ref>, as in the case of bonds.<br/>
<a id="pl.125.17"></a><var>125.17</var>    (f) Notes issued under this section shall require an affirmative vote of two-thirds of <br/>
<a id="pl.125.18"></a><var>125.18</var>the governing body of the city.<br/>
<a id="pl.125.19"></a><var>125.19</var>    (g) Notwithstanding a contrary provision of other law or charter, a home rule charter <br/>
<a id="pl.125.20"></a><var>125.20</var>city may also issue capital notes subject to its debt limit in the manner and subject to the <br/>
<a id="pl.125.21"></a><var>125.21</var>limitations applicable to statutory cities pursuant to section 
         <statute_ref>412.301</statute_ref>.<br/>
<a id="pl.125.22"></a><var>125.22</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.10.16.0"></a><a id="pl.125.23"></a><var>125.23</var>    Sec. 16. Minnesota Statutes 2006, section 412.301, is amended to read:<br/>
<a id="pl.125.24"></a><var>125.24</var><b>412.301 FINANCING PURCHASE OF CERTAIN EQUIPMENT.</b><br/>
<a id="pl.125.25"></a><var>125.25</var>    (a) The council may issue certificates of indebtedness or capital notes subject to the <br/>
<a id="pl.125.26"></a><var>125.26</var>city debt limits to purchase capital equipment.<br/>
<a id="pl.125.27"></a><var>125.27</var>    (b) For purposes of this section, "capital equipment" means:<br/>
<a id="pl.125.28"></a><var>125.28</var>    (1) public safety equipment, ambulance and other medical equipment, road <br/>
<a id="pl.125.29"></a><var>125.29</var>construction and maintenance equipment, and other capital equipment; and<br/>
<a id="pl.125.30"></a><var>125.30</var>    (2) computer hardware and software, whether bundled with machinery or equipment <br/>
<a id="pl.125.31"></a><var>125.31</var>or unbundled.<br/>
<a id="pl.125.32"></a><var>125.32</var>    (c) The equipment or software must have an expected useful life at least as long as <br/>
<a id="pl.125.33"></a><var>125.33</var>the terms of the certificates or notes. The authority to issue capital notes for software <br/>
<a id="pl.125.34"></a><var>125.34</var>expires on July 1, 2007.<br/>
<a id="pl.126.1"></a><var>126.1</var>    (d) Such certificates or notes shall be payable in not more than ten years and shall be <br/>
<a id="pl.126.2"></a><var>126.2</var>issued on such terms and in such manner as the council may determine.<br/>
<a id="pl.126.3"></a><var>126.3</var>    (e) If the amount of the certificates or notes to be issued to finance any such purchase <br/>
<a id="pl.126.4"></a><var>126.4</var>exceeds 0.25 percent of the market value of taxable property in the city, they shall not <br/>
<a id="pl.126.5"></a><var>126.5</var>be issued for at least ten days after publication in the official newspaper of a council <br/>
<a id="pl.126.6"></a><var>126.6</var>resolution determining to issue them; and if before the end of that time, a petition asking <br/>
<a id="pl.126.7"></a><var>126.7</var>for an election on the proposition signed by voters equal to ten percent of the number of <br/>
<a id="pl.126.8"></a><var>126.8</var>voters at the last regular municipal election is filed with the clerk, such certificates or notes <br/>
<a id="pl.126.9"></a><var>126.9</var>shall not be issued until the proposition of their issuance has been approved by a majority <br/>
<a id="pl.126.10"></a><var>126.10</var>of the votes cast on the question at a regular or special election.<br/>
<a id="pl.126.11"></a><var>126.11</var>    (f) A tax levy shall be made for the payment of the principal and interest on such <br/>
<a id="pl.126.12"></a><var>126.12</var>certificates or notes, in accordance with section 
         <statute_ref>475.61</statute_ref>, as in the case of bonds.<br/>
<a id="pl.126.13"></a><var>126.13</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.10.17.0"></a><a id="pl.126.14"></a><var>126.14</var>    Sec. 17. Minnesota Statutes 2006, section 453A.02, subdivision 3, is amended to read:<br/>
<a id="pl.126.15"></a><var>126.15</var>    Subd. 3. <b>City.</b> "City" means a city organized and existing under the laws of <br/>
<a id="pl.126.16"></a><var>126.16</var>Minnesota or a city charter adopted pursuant thereto, and authorized by such laws or <br/>
<a id="pl.126.17"></a><var>126.17</var>charter to engage in the local distribution and sale of gas, provided that any city so <br/>
<a id="pl.126.18"></a><var>126.18</var>engaged on January 1, 1979 is authorized to continue such distribution and sale, and every <br/>
<a id="pl.126.19"></a><var>126.19</var>city now or hereafter so authorized may exercise, either individually or as a member of a <br/>
<a id="pl.126.20"></a><var>126.20</var>municipal gas agency, all of the powers granted in sections 
         <statute_ref>453A.01</statute_ref> to 
         <statute_ref>453A.12</statute_ref>. <br/>
<a id="pl.126.21"></a><var>126.21</var>    City also includes a city organized and existing under the laws of another state or <br/>
<a id="pl.126.22"></a><var>126.22</var>a city charter adopted pursuant thereto which participates in a municipal gas agency <br/>
<a id="pl.126.23"></a><var>126.23</var>with Minnesota cities.<br/>
<br/>
<a id="bill.10.18.0"></a><a id="pl.126.24"></a><var>126.24</var>    Sec. 18. <b>[471.6175] TRUST FOR POSTEMPLOYMENT BENEFITS.</b><br/>
<a id="pl.126.25"></a><var>126.25</var>    Subdivision 1. <b>Authorization; establishment.</b> A political subdivision or other <br/>
<a id="pl.126.26"></a><var>126.26</var>public entity that creates or has created an actuarial liability to pay postemployment <br/>
<a id="pl.126.27"></a><var>126.27</var>benefits to employees or officers after their termination of service may establish a trust to <br/>
<a id="pl.126.28"></a><var>126.28</var>pay those benefits. For purposes of this section, the term "postemployment benefits" means <br/>
<a id="pl.126.29"></a><var>126.29</var>benefits giving rise to a liability under Statement No. 45 of the Governmental Accounting <br/>
<a id="pl.126.30"></a><var>126.30</var>Standards Board and the term "trust" means a trust, a trust account, or a custodial account <br/>
<a id="pl.126.31"></a><var>126.31</var>or contract authorized under section 401(f) of the Internal Revenue Code.<br/>
<a id="pl.126.32"></a><var>126.32</var>    Subd. 2. <b>Purpose of trust.</b> The trust established under this section may only be <br/>
<a id="pl.126.33"></a><var>126.33</var>used to pay postemployment benefits and may be either revocable or irrevocable.<br/>
<a id="pl.127.1"></a><var>127.1</var>    Subd. 3. <b>Trust administrator.</b> The trust administrator of a trust established under <br/>
<a id="pl.127.2"></a><var>127.2</var>this section shall be either:<br/>
<a id="pl.127.3"></a><var>127.3</var>    (1) the Public Employees Retirement Association; <br/>
<a id="pl.127.4"></a><var>127.4</var>    (2) a bank or banking association incorporated under the laws of the United States or <br/>
<a id="pl.127.5"></a><var>127.5</var>of any state and authorized by the laws under which it is organized to exercise corporate <br/>
<a id="pl.127.6"></a><var>127.6</var>trust powers; or <br/>
<a id="pl.127.7"></a><var>127.7</var>    (3) an insurance company or agency qualified to do business in Minnesota which has <br/>
<a id="pl.127.8"></a><var>127.8</var>at least five years' experience in investment products and services for group retirement <br/>
<a id="pl.127.9"></a><var>127.9</var>benefits and which has a specialized department dedicated to services for retirement <br/>
<a id="pl.127.10"></a><var>127.10</var>investment products. <br/>
<a id="pl.127.11"></a><var>127.11</var>    A political subdivision or public entity may, in its discretion and in compliance <br/>
<a id="pl.127.12"></a><var>127.12</var>with any applicable trust document, change trust administrators and transfer trust assets <br/>
<a id="pl.127.13"></a><var>127.13</var>accordingly.<br/>
<a id="pl.127.14"></a><var>127.14</var>    Subd. 4. <b>Account maintenance.</b> (a) A political subdivision or other public entity <br/>
<a id="pl.127.15"></a><var>127.15</var>may establish a trust account to be held under the supervision of the trust administrator for <br/>
<a id="pl.127.16"></a><var>127.16</var>the purposes of this section. A trust administrator shall establish a separate account for <br/>
<a id="pl.127.17"></a><var>127.17</var>each participating political subdivision or public entity. The trust administrator may charge <br/>
<a id="pl.127.18"></a><var>127.18</var>participating political subdivisions and public entities fees for reasonable administrative <br/>
<a id="pl.127.19"></a><var>127.19</var>costs. The amount of any fees charged by the Public Employees Retirement Association is <br/>
<a id="pl.127.20"></a><var>127.20</var>appropriated to the association from the account. A trust administrator may establish other <br/>
<a id="pl.127.21"></a><var>127.21</var>reasonable terms and conditions for creation and maintenance of these accounts. <br/>
<a id="pl.127.22"></a><var>127.22</var>    (b) The trust administrator must report to the political subdivision or other public <br/>
<a id="pl.127.23"></a><var>127.23</var>entity on the investment returns of invested trust assets and on all investment fees or costs <br/>
<a id="pl.127.24"></a><var>127.24</var>incurred by the trust. The annual rates of return, along with investment and administrative <br/>
<a id="pl.127.25"></a><var>127.25</var>fees and costs for the trust, must be disclosed in the political subdivision's or public entity's <br/>
<a id="pl.127.26"></a><var>127.26</var>annual financial audit in a manner prescribed by the state auditor. <br/>
<a id="pl.127.27"></a><var>127.27</var>    (c) Effective for fiscal years beginning after December 31, 2009, the trust <br/>
<a id="pl.127.28"></a><var>127.28</var>administrator must report electronically to the state auditor the portfolio and performance <br/>
<a id="pl.127.29"></a><var>127.29</var>information specified in section 356.219, subdivision 3, in the manner prescribed by <br/>
<a id="pl.127.30"></a><var>127.30</var>the state auditor.<br/>
<a id="pl.127.31"></a><var>127.31</var>    Subd. 5. <b>Investment.</b> (a) The assets of a trust or trust account shall be invested and <br/>
<a id="pl.127.32"></a><var>127.32</var>held as stipulated in paragraphs (b) to (e).<br/>
<a id="pl.127.33"></a><var>127.33</var>    (b) The Public Employees Retirement Association must certify all money in the trust <br/>
<a id="pl.127.34"></a><var>127.34</var>accounts for which it is trust administrator to the State Board of Investment for investment <br/>
<a id="pl.127.35"></a><var>127.35</var>under section 11A.14, subject to the policies and procedures established by the State <br/>
<a id="pl.128.1"></a><var>128.1</var>Board of Investment. Investment earnings must be credited to the trust account of the <br/>
<a id="pl.128.2"></a><var>128.2</var>individual political subdivision or public entity.<br/>
<a id="pl.128.3"></a><var>128.3</var>    (c) A trust administrator, other than the Public Employees Retirement Association, <br/>
<a id="pl.128.4"></a><var>128.4</var>must ensure that all money in the trust accounts for which it is trust administrator is <br/>
<a id="pl.128.5"></a><var>128.5</var>invested by a registered investment adviser, a bank investment trust department, or an <br/>
<a id="pl.128.6"></a><var>128.6</var>insurance company or  agency retirement investment department. Investment earnings <br/>
<a id="pl.128.7"></a><var>128.7</var>must be credited to the trust account of the individual political subdivision or public entity.<br/>
<a id="pl.128.8"></a><var>128.8</var>    (d) For trust assets invested by the State Board of Investment, the investment <br/>
<a id="pl.128.9"></a><var>128.9</var>restrictions shall be the same as those generally applicable to the State Board of <br/>
<a id="pl.128.10"></a><var>128.10</var>Investment. For trust assets invested by a trust administrator other than the Public <br/>
<a id="pl.128.11"></a><var>128.11</var>Employees Retirement Association, the assets may only be invested in investments <br/>
<a id="pl.128.12"></a><var>128.12</var>authorized under chapter 118A or section 356A.06, subdivision 7, in the manner specified <br/>
<a id="pl.128.13"></a><var>128.13</var>in the applicable trust document.<br/>
<a id="pl.128.14"></a><var>128.14</var>    (e) A political subdivision or public entity may provide investment direction to a <br/>
<a id="pl.128.15"></a><var>128.15</var>trust administrator in compliance with any applicable trust document.<br/>
<a id="pl.128.16"></a><var>128.16</var>    Subd. 6. <b>Limit on deposit.</b> A political subdivision or public entity may not <br/>
<a id="pl.128.17"></a><var>128.17</var>deposit money in a trust or trust account created pursuant to this section if the total <br/>
<a id="pl.128.18"></a><var>128.18</var>amount invested by that political subdivision or public entity would exceed the political <br/>
<a id="pl.128.19"></a><var>128.19</var>subdivision's or public entity's actuarially determined liabilities for postemployment <br/>
<a id="pl.128.20"></a><var>128.20</var>benefits due to officers and employees, as determined under the applicable standards of the <br/>
<a id="pl.128.21"></a><var>128.21</var>Governmental Accounting Standards Board.<br/>
<a id="pl.128.22"></a><var>128.22</var>    Subd. 7. <b>Withdrawal of funds and termination of account.</b> (a) For a revocable <br/>
<a id="pl.128.23"></a><var>128.23</var>account, a political subdivision or public entity may withdraw some or all of its money <br/>
<a id="pl.128.24"></a><var>128.24</var>or terminate the trust account. Money and accrued investment earnings withdrawn <br/>
<a id="pl.128.25"></a><var>128.25</var>from a revocable account must be deposited in a fund separate and distinct from any <br/>
<a id="pl.128.26"></a><var>128.26</var>other funds of the political subdivision or public entity. This money, with accrued <br/>
<a id="pl.128.27"></a><var>128.27</var>investment earnings, must be used to pay legally enforceable postemployment benefits <br/>
<a id="pl.128.28"></a><var>128.28</var>to former officers and employees, unless (i) there has been a change in state or federal <br/>
<a id="pl.128.29"></a><var>128.29</var>law affecting that political subdivision's or public entity's liabilities for postemployment <br/>
<a id="pl.128.30"></a><var>128.30</var>benefits, or (ii) there has been a change in the demographic composition of that political <br/>
<a id="pl.128.31"></a><var>128.31</var>subdivision's or public entity's employees eligible for postemployment benefits, or (iii) <br/>
<a id="pl.128.32"></a><var>128.32</var>there has been a change in the provisions or terms of the postemployment benefits in that <br/>
<a id="pl.128.33"></a><var>128.33</var>political subdivision or public entity including, but not limited to, the portion of the costs <br/>
<a id="pl.128.34"></a><var>128.34</var>eligible employees must pay to receive the benefits, or (iv) other factors exist that have <br/>
<a id="pl.128.35"></a><var>128.35</var>a material effect on that political subdivision's or public entity's actuarially determined <br/>
<a id="pl.128.36"></a><var>128.36</var>liabilities for postemployment benefits, in which event any amount in excess of 100 <br/>
<a id="pl.129.1"></a><var>129.1</var>percent of that political subdivision's or public entity's actuarially determined liabilities for <br/>
<a id="pl.129.2"></a><var>129.2</var>postemployment benefits, as determined under standards of the Government Accounting <br/>
<a id="pl.129.3"></a><var>129.3</var>Standards Board, may be withdrawn and used for any purpose.<br/>
<a id="pl.129.4"></a><var>129.4</var>    (b) For an irrevocable account, a political subdivision or public entity may withdraw <br/>
<a id="pl.129.5"></a><var>129.5</var>money only:<br/>
<a id="pl.129.6"></a><var>129.6</var>    (1) as needed to pay postemployment benefits owed to former officers and employees <br/>
<a id="pl.129.7"></a><var>129.7</var>of the political subdivision or public entity; or<br/>
<a id="pl.129.8"></a><var>129.8</var>    (2) when all postemployment benefit  liability owed to former officers or employees <br/>
<a id="pl.129.9"></a><var>129.9</var>of the political subdivision or public entity has been satisfied or otherwise defeased.<br/>
<a id="pl.129.10"></a><var>129.10</var>    (c) A political subdivision or public entity requesting withdrawal of money from <br/>
<a id="pl.129.11"></a><var>129.11</var>an account created under this section must do so at a time and in the manner required by <br/>
<a id="pl.129.12"></a><var>129.12</var>the executive director of the Public Employees Retirement Association or specified in an <br/>
<a id="pl.129.13"></a><var>129.13</var>applicable trust document. The political subdivision or public entity that created the trust <br/>
<a id="pl.129.14"></a><var>129.14</var>must ensure that withdrawals comply with the requirements of this section.<br/>
<a id="pl.129.15"></a><var>129.15</var>    (d) The legislature may not divert funds in these trusts or trust accounts for use <br/>
<a id="pl.129.16"></a><var>129.16</var>for another purpose.<br/>
<a id="pl.129.17"></a><var>129.17</var>    Subd. 8. <b>Status of irrevocable trust.</b> (a) All money in an irrevocable trust or trust <br/>
<a id="pl.129.18"></a><var>129.18</var>account created in this section is held in trust for the exclusive benefit of former officers <br/>
<a id="pl.129.19"></a><var>129.19</var>and employees of the participating political subdivision or public entity, and is not subject <br/>
<a id="pl.129.20"></a><var>129.20</var>to claims by creditors of the state, the participating political subdivision or public entity, <br/>
<a id="pl.129.21"></a><var>129.21</var>the current or former officers and employees of the political subdivision or public entity, <br/>
<a id="pl.129.22"></a><var>129.22</var>or the trust administrator.<br/>
<a id="pl.129.23"></a><var>129.23</var>    (b) An irrevocable trust fund or trust account created in this section shall be deemed <br/>
<a id="pl.129.24"></a><var>129.24</var>an arrangement equivalent to a trust for all legal purposes.<br/>
<a id="pl.129.25"></a><var>129.25</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment, <br/>
<a id="pl.129.26"></a><var>129.26</var>and is applicable immediately to all political subdivisions or public entities subject to <br/>
<a id="pl.129.27"></a><var>129.27</var>Statement No. 45 of the Governmental Accounting Standards Board in 2007, to those <br/>
<a id="pl.129.28"></a><var>129.28</var>political subdivisions or public entities whose trusts or trust accounts are validated <br/>
<a id="pl.129.29"></a><var>129.29</var>by section 27, and to those political subdivisions or public entities that have begun <br/>
<a id="pl.129.30"></a><var>129.30</var>consideration in 2007 of measures to implement Statement No. 45. This section is <br/>
<a id="pl.129.31"></a><var>129.31</var>applicable on July 1, 2008, for all other political subdivisions or public entities.<br/>
<br/>
<a id="bill.10.19.0"></a><a id="pl.129.32"></a><var>129.32</var>    Sec. 19. Minnesota Statutes 2006, section 473.39, is amended by adding a subdivision <br/>
<a id="pl.129.33"></a><var>129.33</var>to read:<br/>
<a id="pl.129.34"></a><var>129.34</var>    Subd. 1m. <b>Obligations.</b> After March 1, 2008, in addition to other authority in this <br/>
<a id="pl.129.35"></a><var>129.35</var>section, the council may issue certificates of indebtedness, bonds, or other obligations <br/>
<a id="pl.130.1"></a><var>130.1</var>under this section in an amount not exceeding $33,600,000 for capital expenditures as <br/>
<a id="pl.130.2"></a><var>130.2</var>prescribed in the council's regional transit master plan and transit capital improvement <br/>
<a id="pl.130.3"></a><var>130.3</var>program and for related costs, including the costs of issuance and sale of the obligations.<br/>
<a id="pl.130.4"></a><var>130.4</var><b>APPLICATION AND EFFECTIVE DATE.</b>This section applies in the counties of <br/>
<a id="pl.130.5"></a><var>130.5</var>Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and Washington, and is effective the <br/>
<a id="pl.130.6"></a><var>130.6</var>day following final enactment.<br/>
<br/>
<a id="bill.10.20.0"></a><a id="pl.130.7"></a><var>130.7</var>    Sec. 20. Minnesota Statutes 2006, section 473.39, is amended by adding a subdivision <br/>
<a id="pl.130.8"></a><var>130.8</var>to read:<br/>
<a id="pl.130.9"></a><var>130.9</var>    Subd. 5. <b>Anticipation of grants.</b> In addition to other authority granted in this <br/>
<a id="pl.130.10"></a><var>130.10</var>section, the council may exercise the authority granted to an issuing political subdivision <br/>
<a id="pl.130.11"></a><var>130.11</var>by section 475.522.<br/>
<a id="pl.130.12"></a><var>130.12</var><b>APPLICATION AND EFFECTIVE DATE.</b>This section applies in the counties of <br/>
<a id="pl.130.13"></a><var>130.13</var>Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and Washington, and is effective the <br/>
<a id="pl.130.14"></a><var>130.14</var>day following final enactment.<br/>
<br/>
<a id="bill.10.21.0"></a><a id="pl.130.15"></a><var>130.15</var>    Sec. 21. Minnesota Statutes 2006, section 475.51, subdivision 4, is amended to read:<br/>
<a id="pl.130.16"></a><var>130.16</var>    Subd. 4. <b>Net debt.</b> "Net debt" means the amount remaining after deducting from its <br/>
<a id="pl.130.17"></a><var>130.17</var>gross debt the amount of current revenues which are applicable within the current fiscal <br/>
<a id="pl.130.18"></a><var>130.18</var>year to the payment of any debt and the aggregate of the principal of the following:<br/>
<a id="pl.130.19"></a><var>130.19</var>    (1) Obligations issued for improvements which are payable wholly or partly from the <br/>
<a id="pl.130.20"></a><var>130.20</var>proceeds of special assessments levied upon property specially benefited thereby, including <br/>
<a id="pl.130.21"></a><var>130.21</var>those which are general obligations of the municipality issuing them, if the municipality is <br/>
<a id="pl.130.22"></a><var>130.22</var>entitled to reimbursement in whole or in part from the proceeds of the special assessments.<br/>
<a id="pl.130.23"></a><var>130.23</var>    (2) Warrants or orders having no definite or fixed maturity.<br/>
<a id="pl.130.24"></a><var>130.24</var>    (3) Obligations payable wholly from the income from revenue producing <br/>
<a id="pl.130.25"></a><var>130.25</var>conveniences.<br/>
<a id="pl.130.26"></a><var>130.26</var>    (4) Obligations issued to create or maintain a permanent improvement revolving <br/>
<a id="pl.130.27"></a><var>130.27</var>fund.<br/>
<a id="pl.130.28"></a><var>130.28</var>    (5) Obligations issued for the acquisition, and betterment of public waterworks <br/>
<a id="pl.130.29"></a><var>130.29</var>systems, and public lighting, heating or power systems, and of any combination thereof or <br/>
<a id="pl.130.30"></a><var>130.30</var>for any other public convenience from which a revenue is or may be derived.<br/>
<a id="pl.130.31"></a><var>130.31</var>    (6) Debt service loans and capital loans made to a school district under the provisions <br/>
<a id="pl.130.32"></a><var>130.32</var>of sections 
         <statute_ref>126C.68</statute_ref> and 
         <statute_ref>126C.69</statute_ref>.<br/>
<a id="pl.131.1"></a><var>131.1</var>    (7) Amount of all money and the face value of all securities held as a debt service <br/>
<a id="pl.131.2"></a><var>131.2</var>fund for the extinguishment of obligations other than those deductible under this <br/>
<a id="pl.131.3"></a><var>131.3</var>subdivision.<br/>
<a id="pl.131.4"></a><var>131.4</var>    (8) Obligations to repay loans made under section 
         <statute_ref>216C.37</statute_ref>.<br/>
<a id="pl.131.5"></a><var>131.5</var>    (9) Obligations to repay loans made from money received from litigation or <br/>
<a id="pl.131.6"></a><var>131.6</var>settlement of alleged violations of federal petroleum pricing regulations.<br/>
<a id="pl.131.7"></a><var>131.7</var>    (10) Obligations issued to pay pension fund or other postemployment benefit <br/>
<a id="pl.131.8"></a><var>131.8</var>liabilities under section 
         <statute_ref>475.52, subdivision 6</statute_ref>, or any charter authority.<br/>
<a id="pl.131.9"></a><var>131.9</var>    (11) Obligations issued to pay judgments against the municipality under section <br/>
<statute_ref><a id="pl.131.10"></a><var>131.10</var>475.52, subdivision 6
         </statute_ref>, or any charter authority.<br/>
<a id="pl.131.11"></a><var>131.11</var>    (12) All other obligations which under the provisions of law authorizing their <br/>
<a id="pl.131.12"></a><var>131.12</var>issuance are not to be included in computing the net debt of the municipality.<br/>
<a id="pl.131.13"></a><var>131.13</var><b>EFFECTIVE DATE.</b>This section is effective for obligations issued after June <br/>
<a id="pl.131.14"></a><var>131.14</var>30, 2008.<br/>
<br/>
<a id="bill.10.22.0"></a><a id="pl.131.15"></a><var>131.15</var>    Sec. 22. Minnesota Statutes 2006, section 475.52, subdivision 6, is amended to read:<br/>
<a id="pl.131.16"></a><var>131.16</var>    Subd. 6. <b>Certain purposes.</b> Any municipality may issue bonds for paying <br/>
<a id="pl.131.17"></a><var>131.17</var>judgments against it; for refunding outstanding bonds; for funding floating indebtedness; <br/>
<a id="pl.131.18"></a><var>131.18</var>for funding actuarial liabilities to pay postemployment benefits to employees or officers <br/>
<a id="pl.131.19"></a><var>131.19</var>after their termination of service; or for funding all or part of the municipality's current <br/>
<a id="pl.131.20"></a><var>131.20</var>and future unfunded liability for a pension or retirement fund or plan referred to in <br/>
<a id="pl.131.21"></a><var>131.21</var>section 
         <statute_ref>356.20, subdivision 2</statute_ref>, as those liabilities are most recently computed pursuant <br/>
<a id="pl.131.22"></a><var>131.22</var>to sections 
         <statute_ref>356.215</statute_ref> and 
         <statute_ref>356.216</statute_ref>. The board of trustees or directors of a pension fund or <br/>
<a id="pl.131.23"></a><var>131.23</var>relief association referred to in section 
         <statute_ref>69.77</statute_ref> or chapter 422A must consent and must <br/>
<a id="pl.131.24"></a><var>131.24</var>be a party to any contract made under this section with respect to the fund held by it <br/>
<a id="pl.131.25"></a><var>131.25</var>for the benefit of and in trust for its members. For purposes of this section, the term <br/>
<a id="pl.131.26"></a><var>131.26</var>"postemployment benefits" means benefits giving rise to a liability under Statement No. <br/>
<a id="pl.131.27"></a><var>131.27</var>45 of the Governmental Accounting Standards Board.<br/>
<br/>
<a id="bill.10.23.0"></a><a id="pl.131.28"></a><var>131.28</var>    Sec. 23. <b>[475.522] GRANT ANTICIPATION FINANCING OF </b><br/>
<a id="pl.131.29"></a><var>131.29</var><b>TRANSPORTATION OR TRANSIT PROJECTS.</b><br/>
<a id="pl.131.30"></a><var>131.30</var>    Subdivision 1. <b>Definitions.</b> For purposes of this section, the term "political <br/>
<a id="pl.131.31"></a><var>131.31</var>subdivision" means a county or a statutory or home rule charter city, and the term <br/>
<a id="pl.131.32"></a><var>131.32</var>"issuing political subdivision" means a political subdivision that issues obligations under <br/>
<a id="pl.131.33"></a><var>131.33</var>subdivision 2.<br/>
<a id="pl.132.1"></a><var>132.1</var>    Subd. 2. <b>Authorization.</b> An issuing political subdivision may enter into agreements <br/>
<a id="pl.132.2"></a><var>132.2</var>with any other political subdivision of the state, within or without its jurisdiction, and any <br/>
<a id="pl.132.3"></a><var>132.3</var>state agency, with respect to federal grants for transportation or transit projects to be <br/>
<a id="pl.132.4"></a><var>132.4</var>received directly or indirectly by or on behalf of the political subdivision or agency, <br/>
<a id="pl.132.5"></a><var>132.5</var>under an executed grant agreement with the relevant federal agency. The agreements <br/>
<a id="pl.132.6"></a><var>132.6</var>may provide that the political subdivision or agency will pledge to the issuing political <br/>
<a id="pl.132.7"></a><var>132.7</var>subdivision all or a specified portion of the federal grants received by or on behalf of the <br/>
<a id="pl.132.8"></a><var>132.8</var>political subdivision or agency for a specified period of years, or until all obligations issued <br/>
<a id="pl.132.9"></a><var>132.9</var>by the issuing political subdivision under subdivision 3 with respect to those federal grants <br/>
<a id="pl.132.10"></a><var>132.10</var>have been paid or legally defeased. If the issuing political subdivision issues obligations <br/>
<a id="pl.132.11"></a><var>132.11</var>under subdivision 3, the agreements must provide the method by which the proceeds of <br/>
<a id="pl.132.12"></a><var>132.12</var>the obligations will be used to pay or reimburse the costs of the transportation or transit <br/>
<a id="pl.132.13"></a><var>132.13</var>projects relating to the federal grants described in the executed federal grant agreement.<br/>
<a id="pl.132.14"></a><var>132.14</var>    Subd. 3. <b>Issuance of obligations.</b> In anticipation of any federal grants for <br/>
<a id="pl.132.15"></a><var>132.15</var>transportation or transit projects to be received directly or indirectly by any political <br/>
<a id="pl.132.16"></a><var>132.16</var>subdivision or agency as specified in subdivision 1, or by an issuing political subdivision <br/>
<a id="pl.132.17"></a><var>132.17</var>with respect to any transportation or transit projects within its jurisdiction, an issuing <br/>
<a id="pl.132.18"></a><var>132.18</var>political subdivision may issue its obligations payable from the collections of those <br/>
<a id="pl.132.19"></a><var>132.19</var>federal grants. The obligations may be issued in the principal amount the issuing political <br/>
<a id="pl.132.20"></a><var>132.20</var>subdivision determines provided that the estimated collections of the federal grants under <br/>
<a id="pl.132.21"></a><var>132.21</var>the relevant executed federal grant agreement in each year in which the obligations will <br/>
<a id="pl.132.22"></a><var>132.22</var>be outstanding must be at least equal to:<br/>
<a id="pl.132.23"></a><var>132.23</var>    (1) if the obligations are to be issued as revenue obligations, 150 percent of the <br/>
<a id="pl.132.24"></a><var>132.24</var>maximum annual debt service on the obligations; or<br/>
<a id="pl.132.25"></a><var>132.25</var>    (2) if the obligations are to be issued as general obligations, 110 percent of the <br/>
<a id="pl.132.26"></a><var>132.26</var>maximum annual debt service on the obligations.<br/>
<a id="pl.132.27"></a><var>132.27</var>    Except as otherwise provided in this section, the issuing political subdivision shall <br/>
<a id="pl.132.28"></a><var>132.28</var>provide for the issuance, sale, and security of the obligations as provided in chapter 475, <br/>
<a id="pl.132.29"></a><var>132.29</var>and has the same powers and duties as a municipality issuing bonds under that law, except <br/>
<a id="pl.132.30"></a><var>132.30</var>that no election is required and the net debt limitations in chapter 475 do not apply to the <br/>
<a id="pl.132.31"></a><var>132.31</var>obligations. The issuing political subdivision may determine to issue the obligations as <br/>
<a id="pl.132.32"></a><var>132.32</var>revenue obligations, payable solely from the collections of the federal grants anticipated, <br/>
<a id="pl.132.33"></a><var>132.33</var>or may pledge its full faith and credit to the payment of the obligations.<br/>
<a id="pl.132.34"></a><var>132.34</var>    Subd. 4. <b>Use of proceeds.</b> The proceeds of the obligations must be used:<br/>
<a id="pl.132.35"></a><var>132.35</var>    (1) to pay or reimburse the costs of the transportation or transit projects relating to <br/>
<a id="pl.132.36"></a><var>132.36</var>the federal grants being anticipated;<br/>
<a id="pl.133.1"></a><var>133.1</var>    (2) to pay the costs of issuance of the obligations, including credit enhancement; <br/>
<a id="pl.133.2"></a><var>133.2</var>    (3) to pay interest on the obligations for a period not exceeding three years from <br/>
<a id="pl.133.3"></a><var>133.3</var>their date of issue; and<br/>
<a id="pl.133.4"></a><var>133.4</var>    (4) if the full faith and credit of the issuing political subdivision is not pledged to the <br/>
<a id="pl.133.5"></a><var>133.5</var>payment of the obligations, to fund a debt service reserve fund for the obligations.<br/>
<br/>
<a id="bill.10.24.0"></a><a id="pl.133.6"></a><var>133.6</var>    Sec. 24. Minnesota Statutes 2006, section 475.53, subdivision 1, is amended to read:<br/>
<a id="pl.133.7"></a><var>133.7</var>    Subdivision 1. <b>Generally.</b> Except as otherwise provided in sections 
         <statute_ref>475.51</statute_ref> to <br/>
<statute_ref><a id="pl.133.8"></a><var>133.8</var>475.74
         </statute_ref>, no municipality, except a school district or a city of the first class, shall incur or <br/>
<a id="pl.133.9"></a><var>133.9</var>be subject to a net debt in excess of two three percent of the market value of taxable <br/>
<a id="pl.133.10"></a><var>133.10</var>property in the municipality. <br/>
<a id="pl.133.11"></a><var>133.11</var><b>EFFECTIVE DATE.</b>This section is effective for obligations issued after June <br/>
<a id="pl.133.12"></a><var>133.12</var>30, 2008.<br/>
<br/>
<a id="bill.10.25.0"></a><a id="pl.133.13"></a><var>133.13</var>    Sec. 25. Minnesota Statutes 2006, section 475.58, subdivision 1, is amended to read:<br/>
<a id="pl.133.14"></a><var>133.14</var>    Subdivision 1. <b>Approval by electors; exceptions.</b> Obligations authorized by law or <br/>
<a id="pl.133.15"></a><var>133.15</var>charter may be issued by any municipality upon obtaining the approval of a majority of <br/>
<a id="pl.133.16"></a><var>133.16</var>the electors voting on the question of issuing the obligations, but an election shall not be <br/>
<a id="pl.133.17"></a><var>133.17</var>required to authorize obligations issued:<br/>
<a id="pl.133.18"></a><var>133.18</var>    (1) to pay any unpaid judgment against the municipality;<br/>
<a id="pl.133.19"></a><var>133.19</var>    (2) for refunding obligations;<br/>
<a id="pl.133.20"></a><var>133.20</var>    (3) for an improvement or improvement program, which obligation is payable wholly <br/>
<a id="pl.133.21"></a><var>133.21</var>or partly from the proceeds of special assessments levied upon property specially benefited <br/>
<a id="pl.133.22"></a><var>133.22</var>by the improvement or by an improvement within the improvement program, or from tax <br/>
<a id="pl.133.23"></a><var>133.23</var>increments, as defined in section 
         <statute_ref>469.174</statute_ref>, subdivision 25, including obligations which are <br/>
<a id="pl.133.24"></a><var>133.24</var>the general obligations of the municipality, if the municipality is entitled to reimbursement <br/>
<a id="pl.133.25"></a><var>133.25</var>in whole or in part from the proceeds of such special assessments or tax increments and <br/>
<a id="pl.133.26"></a><var>133.26</var>not less than 20 percent of the cost of the improvement or the improvement program is to <br/>
<a id="pl.133.27"></a><var>133.27</var>be assessed against benefited property or is to be paid from the proceeds of federal grant <br/>
<a id="pl.133.28"></a><var>133.28</var>funds or a combination thereof, or is estimated to be received from tax increments;<br/>
<a id="pl.133.29"></a><var>133.29</var>    (4) payable wholly from the income of revenue producing conveniences;<br/>
<a id="pl.133.30"></a><var>133.30</var>    (5) under the provisions of a home rule charter which permits the issuance of <br/>
<a id="pl.133.31"></a><var>133.31</var>obligations of the municipality without election;<br/>
<a id="pl.133.32"></a><var>133.32</var>    (6) under the provisions of a law which permits the issuance of obligations of a <br/>
<a id="pl.133.33"></a><var>133.33</var>municipality without an election;<br/>
<a id="pl.134.1"></a><var>134.1</var>    (7) to fund pension or retirement fund or postemployment benefit liabilities pursuant <br/>
<a id="pl.134.2"></a><var>134.2</var>to section 
         <statute_ref>475.52, subdivision 6</statute_ref>; <br/>
<a id="pl.134.3"></a><var>134.3</var>    (8) under a capital improvement plan under section 
         <statute_ref>373.40</statute_ref>; and <br/>
<a id="pl.134.4"></a><var>134.4</var>    (9) under sections 
         <statute_ref>469.1813</statute_ref> to 
         <statute_ref>469.1815</statute_ref> (property tax abatement authority bonds), if <br/>
<a id="pl.134.5"></a><var>134.5</var>the proceeds of the bonds are not used for a purpose prohibited under section 
         <statute_ref>469.176, <br/>
<a id="pl.134.6"></a><var>134.6</var>subdivision 4g
         </statute_ref>, paragraph (b). <br/>
<br/>
<a id="bill.10.26.0"></a><a id="pl.134.7"></a><var>134.7</var>    Sec. 26. Minnesota Statutes 2006, section 475.58, subdivision 3b, is amended to read:<br/>
<a id="pl.134.8"></a><var>134.8</var>    Subd. 3b. <b>Street reconstruction.</b> (a) A municipality may, without regard to <br/>
<a id="pl.134.9"></a><var>134.9</var>the election requirement under subdivision 1, issue and sell obligations for street <br/>
<a id="pl.134.10"></a><var>134.10</var>reconstruction, if the following conditions are met:<br/>
<a id="pl.134.11"></a><var>134.11</var>    (1) the streets are reconstructed under a street reconstruction plan that describes the <br/>
<a id="pl.134.12"></a><var>134.12</var>streets to be reconstructed street reconstruction to be financed, the estimated costs, and <br/>
<a id="pl.134.13"></a><var>134.13</var>any planned reconstruction of other streets in the municipality over the next five years, <br/>
<a id="pl.134.14"></a><var>134.14</var>and the plan and issuance of the obligations has been approved by a vote of all of the <br/>
<a id="pl.134.15"></a><var>134.15</var>members of the governing body present at the meeting following a public hearing for <br/>
<a id="pl.134.16"></a><var>134.16</var>which notice has been published in the official newspaper at least ten days but not more <br/>
<a id="pl.134.17"></a><var>134.17</var>than 28 days prior to the hearing; and<br/>
<a id="pl.134.18"></a><var>134.18</var>    (2) if a petition requesting a vote on the issuance is signed by voters equal to <br/>
<a id="pl.134.19"></a><var>134.19</var>five percent of the votes cast in the last municipal general election and is filed with the <br/>
<a id="pl.134.20"></a><var>134.20</var>municipal clerk within 30 days of the public hearing, the municipality may issue the bonds <br/>
<a id="pl.134.21"></a><var>134.21</var>only after obtaining the approval of a majority of the voters voting on the question of <br/>
<a id="pl.134.22"></a><var>134.22</var>the issuance of the obligations.<br/>
<a id="pl.134.23"></a><var>134.23</var>    (b) Obligations issued under this subdivision are subject to the debt limit of the <br/>
<a id="pl.134.24"></a><var>134.24</var>municipality and are not excluded from net debt under section 
         <statute_ref>475.51, subdivision 4</statute_ref>.<br/>
<a id="pl.134.25"></a><var>134.25</var>    (c) For purposes of this subdivision, street reconstruction includes utility <br/>
<a id="pl.134.26"></a><var>134.26</var>replacement and relocation and other activities incidental to the street reconstruction, turn <br/>
<a id="pl.134.27"></a><var>134.27</var>lanes and other improvements having a substantial public safety function, realignments, <br/>
<a id="pl.134.28"></a><var>134.28</var>other modifications to intersect with state and county roads, and the local share of state <br/>
<a id="pl.134.29"></a><var>134.29</var>and county road projects.<br/>
<a id="pl.134.30"></a><var>134.30</var>    (d) Except in the case of turn lanes, safety improvements, realignments, intersection <br/>
<a id="pl.134.31"></a><var>134.31</var>modifications, and the local share of state and county road projects, street reconstruction <br/>
<a id="pl.134.32"></a><var>134.32</var>does not include the portion of project cost allocable to widening a street or adding curbs <br/>
<a id="pl.134.33"></a><var>134.33</var>and gutters where none previously existed.<br/>
<br/>
<a id="bill.10.27.0"></a><a id="pl.134.34"></a><var>134.34</var>    Sec. 27. <b>VALIDATION.</b><br/>
<a id="pl.135.1"></a><var>135.1</var>    Any trust or trust account or other custodial account or contract authorized under <br/>
<a id="pl.135.2"></a><var>135.2</var>section 401(f) of the Internal Revenue Code, created prior to June 6, 2006, to pay <br/>
<a id="pl.135.3"></a><var>135.3</var>postemployment benefits to employees or officers after termination of service, is hereby <br/>
<a id="pl.135.4"></a><var>135.4</var>validated, may continue in full force and effect, and shall have continuing authority <br/>
<a id="pl.135.5"></a><var>135.5</var>to accept new funds; however, this section does not validate or correct defects in any <br/>
<a id="pl.135.6"></a><var>135.6</var>previously created trust document. Any funds held by a validated trust or account <br/>
<a id="pl.135.7"></a><var>135.7</var>under this section may be invested as provided in Minnesota Statutes, section 471.6175, <br/>
<a id="pl.135.8"></a><var>135.8</var>subdivision 5. A validated trust or account shall have until January 1, 2009, to bring <br/>
<a id="pl.135.9"></a><var>135.9</var>its trust documents and procedures into compliance with Minnesota Statutes, section <br/>
<a id="pl.135.10"></a><var>135.10</var>471.6175.<br/>
<a id="pl.135.11"></a><var>135.11</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.10.28.0"></a><a id="pl.135.12"></a><var>135.12</var>    Sec. 28. <b>TOWN OF CRANE LAKE, CERTIFICATES OF INDEBTEDNESS.</b><br/>
<a id="pl.135.13"></a><var>135.13</var>    Notwithstanding Minnesota Statutes, section 366.095, or any other law to the <br/>
<a id="pl.135.14"></a><var>135.14</var>contrary, the town board of the town of Crane Lake in St. Louis County may issue one <br/>
<a id="pl.135.15"></a><var>135.15</var>or more certificates of indebtedness in a total amount not to exceed $250,000, which <br/>
<a id="pl.135.16"></a><var>135.16</var>are not subject to the debt limits of the town. The proceeds of the certificates must be <br/>
<a id="pl.135.17"></a><var>135.17</var>used to acquire property and pay other costs related to a land exchange with the United <br/>
<a id="pl.135.18"></a><var>135.18</var>States Forest Service. The certificates shall be payable in not more than 30 years and be <br/>
<a id="pl.135.19"></a><var>135.19</var>issued on the terms and in the manner as the board may determine. Minnesota Statutes, <br/>
<a id="pl.135.20"></a><var>135.20</var>sections 475.54, subdivision 1, and 475.56, paragraph (c), do not apply to the certificates <br/>
<a id="pl.135.21"></a><var>135.21</var>issued under this section. A tax levy shall be made to pay the principal and interest on the <br/>
<a id="pl.135.22"></a><var>135.22</var>certificates as in the case of bonds.<br/>
<a id="pl.135.23"></a><var>135.23</var><b>EFFECTIVE DATE.</b>This section is effective the day after the governing body of <br/>
<a id="pl.135.24"></a><var>135.24</var>the town of Crane Lake and its chief clerical officer timely complete their compliance with <br/>
<a id="pl.135.25"></a><var>135.25</var>Minnesota Statutes, section 645.021, subdivisions 2 and 3. <br/>
<br/>
<a id="bill.10.29.0"></a><a id="pl.135.26"></a><var>135.26</var>    Sec. 29. <b>CITY OF WINSTED; BONDING AUTHORITY.</b><br/>
<a id="pl.135.27"></a><var>135.27</var>    (a) The city of Winsted may issue general obligation bonds under Minnesota <br/>
<a id="pl.135.28"></a><var>135.28</var>Statutes, chapter 475, to finance the acquisition and betterment of a facility consisting of <br/>
<a id="pl.135.29"></a><var>135.29</var>a city hall, community center, and police station; park improvements, including trails <br/>
<a id="pl.135.30"></a><var>135.30</var>and an amphitheater; related public improvements; and substantial landscaping for the <br/>
<a id="pl.135.31"></a><var>135.31</var>improvements. <br/>
<a id="pl.135.32"></a><var>135.32</var>    (b) The bonds may be issued as general obligations of the city without an election to <br/>
<a id="pl.135.33"></a><var>135.33</var>approve the bonds under Minnesota Statutes, section 475.58.<br/>
<a id="pl.136.1"></a><var>136.1</var>    (c) The bonds are not included in computing any debt limitation applicable to the <br/>
<a id="pl.136.2"></a><var>136.2</var>city, including, but not limited to, the net debt limits under Minnesota Statutes, section <br/>
<a id="pl.136.3"></a><var>136.3</var>475.53, and the levy of taxes under Minnesota Statutes, section 475.61, to pay principal of <br/>
<a id="pl.136.4"></a><var>136.4</var>and interest on the bonds is not subject to any levy limitation.<br/>
<a id="pl.136.5"></a><var>136.5</var>    (d) The aggregate principal amount of bonds used to pay costs of the acquisition and <br/>
<a id="pl.136.6"></a><var>136.6</var>betterment of the facility consisting of a city hall, community center, and police station; <br/>
<a id="pl.136.7"></a><var>136.7</var>park improvements, including trails and an amphitheater; related public improvements; <br/>
<a id="pl.136.8"></a><var>136.8</var>and substantial landscaping for the improvements may not exceed $4,900,000, plus an <br/>
<a id="pl.136.9"></a><var>136.9</var>amount equal to the costs related to issuance of the bonds and capitalized interest.<br/>
<a id="pl.136.10"></a><var>136.10</var><b>EFFECTIVE DATE.</b>This section is effective upon compliance by the governing <br/>
<a id="pl.136.11"></a><var>136.11</var>body of the city of Winsted with Minnesota Statutes, section 645.021, subdivision 3.<br/>
<br/>
<a id="bill.11.0.0"></a>

<a id="bill.11.1.0"></a><a id="pl.136.14"></a><var>136.14</var>    Section 1. Minnesota Statutes 2007 Supplement, section 270A.03, subdivision 5, <br/>
<a id="pl.136.15"></a><var>136.15</var>is amended to read:<br/>
<a id="pl.136.16"></a><var>136.16</var>    Subd. 5. <b>Debt.</b> (a) "Debt" means a legal obligation of a natural person to pay a fixed <br/>
<a id="pl.136.17"></a><var>136.17</var>and certain amount of money, which equals or exceeds $25 and which is due and payable <br/>
<a id="pl.136.18"></a><var>136.18</var>to a claimant agency. The term includes criminal fines imposed under section 
         <statute_ref>609.10</statute_ref> or <br/>
<statute_ref><a id="pl.136.19"></a><var>136.19</var>609.125
         </statute_ref>, fines imposed for petty misdemeanors as defined in section 
         <statute_ref>609.02, subdivision <br/>
<a id="pl.136.20"></a><var>136.20</var>4a
         </statute_ref>, and restitution. A debt may arise under a contractual or statutory obligation, a court <br/>
<a id="pl.136.21"></a><var>136.21</var>order, or other legal obligation, but need not have been reduced to judgment.<br/>
<a id="pl.136.22"></a><var>136.22</var>    A debt includes any legal obligation of a current recipient of assistance which is <br/>
<a id="pl.136.23"></a><var>136.23</var>based on overpayment of an assistance grant where that payment is based on a client <br/>
<a id="pl.136.24"></a><var>136.24</var>waiver or an administrative or judicial finding of an intentional program violation; <br/>
<a id="pl.136.25"></a><var>136.25</var>or where the debt is owed to a program wherein the debtor is not a client at the time <br/>
<a id="pl.136.26"></a><var>136.26</var>notification is provided to initiate recovery under this chapter and the debtor is not a <br/>
<a id="pl.136.27"></a><var>136.27</var>current recipient of food support, transitional child care, or transitional medical assistance.<br/>
<a id="pl.136.28"></a><var>136.28</var>    (b) A debt does not include any legal obligation to pay a claimant agency for medical <br/>
<a id="pl.136.29"></a><var>136.29</var>care, including hospitalization if the income of the debtor at the time when the medical <br/>
<a id="pl.136.30"></a><var>136.30</var>care was rendered does not exceed the following amount:<br/>
<a id="pl.136.31"></a><var>136.31</var>    (1) for an unmarried debtor, an income of $8,800 or less;<br/>
<a id="pl.136.32"></a><var>136.32</var>    (2) for a debtor with one dependent, an income of $11,270 or less;<br/>
<a id="pl.136.33"></a><var>136.33</var>    (3) for a debtor with two dependents, an income of $13,330 or less;<br/>
<a id="pl.136.34"></a><var>136.34</var>    (4) for a debtor with three dependents, an income of $15,120 or less;<br/>
<a id="pl.137.1"></a><var>137.1</var>    (5) for a debtor with four dependents, an income of $15,950 or less; and<br/>
<a id="pl.137.2"></a><var>137.2</var>    (6) for a debtor with five or more dependents, an income of $16,630 or less.<br/>
<a id="pl.137.3"></a><var>137.3</var>    The income amounts in this subdivision shall be adjusted for inflation for debts <br/>
<a id="pl.137.4"></a><var>137.4</var>incurred in calendar years 2001 and thereafter. The dollar amount of each income level <br/>
<a id="pl.137.5"></a><var>137.5</var>that applied to debts incurred in the prior year shall be increased in the same manner <br/>
<a id="pl.137.6"></a><var>137.6</var>as provided in section 1(f) of the Internal Revenue Code of 1986, as amended through <br/>
<a id="pl.137.7"></a><var>137.7</var>December 31, 2000, except that for the purposes of this subdivision the percentage <br/>
<a id="pl.137.8"></a><var>137.8</var>increase shall be determined from the year starting September 1, 1999, and ending August <br/>
<a id="pl.137.9"></a><var>137.9</var>31, 2000, as the base year for adjusting for inflation for debts incurred after December <br/>
<a id="pl.137.10"></a><var>137.10</var>31, 2000. (c) The commissioner shall adjust the income amounts in paragraph (b) by the <br/>
<a id="pl.137.11"></a><var>137.11</var>percentage determined pursuant to the provisions of section 1(f) of the Internal Revenue <br/>
<a id="pl.137.12"></a><var>137.12</var>Code, except that in section 1(f)(3)(B) the word "1999" shall be substituted for the word <br/>
<a id="pl.137.13"></a><var>137.13</var>"1992." For 2001, the commissioner shall then determine the percent change from the 12 <br/>
<a id="pl.137.14"></a><var>137.14</var>months ending on August 31, 1999, to the 12 months ending on August 31, 2000, and in <br/>
<a id="pl.137.15"></a><var>137.15</var>each subsequent year, from the 12 months ending on August 31, 1999, to the 12 months <br/>
<a id="pl.137.16"></a><var>137.16</var>ending on August 31 of the year preceding the taxable year. The determination of the <br/>
<a id="pl.137.17"></a><var>137.17</var>commissioner pursuant to this subdivision shall not be considered a "rule" and shall not <br/>
<a id="pl.137.18"></a><var>137.18</var>be subject to the Administrative Procedure Act contained in chapter 14. The income <br/>
<a id="pl.137.19"></a><var>137.19</var>amount as adjusted must be rounded to the nearest $10 amount. If the amount ends in <br/>
<a id="pl.137.20"></a><var>137.20</var>$5, the amount is rounded up to the nearest $10 amount.<br/>
<a id="pl.137.21"></a><var>137.21</var>    (d) Debt also includes an agreement to pay a MinnesotaCare premium, regardless of <br/>
<a id="pl.137.22"></a><var>137.22</var>the dollar amount of the premium authorized under section 
         <statute_ref>256L.15, subdivision 1a</statute_ref>.<br/>
<a id="pl.137.23"></a><var>137.23</var><b>EFFECTIVE DATE.</b>This section is effective for debts incurred after December <br/>
<a id="pl.137.24"></a><var>137.24</var>31, 2007.<br/>
<br/>
<a id="bill.11.2.0"></a><a id="pl.137.25"></a><var>137.25</var>    Sec. 2. Minnesota Statutes 2006, section 289A.08, subdivision 11, is amended to read:<br/>
<a id="pl.137.26"></a><var>137.26</var>    Subd. 11. <b>Information included in income tax return.</b> (a) The return must state:<br/>
<a id="pl.137.27"></a><var>137.27</var>    (1) the name of the taxpayer, or taxpayers, if the return is a joint return, and the <br/>
<a id="pl.137.28"></a><var>137.28</var>address of the taxpayer in the same name or names and same address as the taxpayer has <br/>
<a id="pl.137.29"></a><var>137.29</var>used in making the taxpayer's income tax return to the United States, and must state;<br/>
<a id="pl.137.30"></a><var>137.30</var>    (2) the date or dates of birth of the taxpayer or taxpayers;<br/>
<a id="pl.137.31"></a><var>137.31</var>    (3) the Social Security number of the taxpayer, or taxpayers, if a Social Security <br/>
<a id="pl.137.32"></a><var>137.32</var>number has been issued by the United States with respect to the taxpayers, and must <br/>
<a id="pl.137.33"></a><var>137.33</var>state; and<br/>
<a id="pl.137.34"></a><var>137.34</var>    (4) the amount of the taxable income of the taxpayer as it appears on the federal <br/>
<a id="pl.137.35"></a><var>137.35</var>return for the taxable year to which the Minnesota state return applies. <br/>
<a id="pl.138.1"></a><var>138.1</var>    (b) The taxpayer must attach to the taxpayer's Minnesota state income tax return <br/>
<a id="pl.138.2"></a><var>138.2</var>a copy of the federal income tax return that the taxpayer has filed or is about to file for <br/>
<a id="pl.138.3"></a><var>138.3</var>the period, unless the taxpayer is eligible to telefile the federal return and does file the <br/>
<a id="pl.138.4"></a><var>138.4</var>Minnesota return by telefiling.<br/>
<a id="pl.138.5"></a><var>138.5</var><b>EFFECTIVE DATE.</b>This section is effective for taxable years beginning after <br/>
<a id="pl.138.6"></a><var>138.6</var>December 31, 2007.<br/>
<br/>
<a id="bill.11.3.0"></a><a id="pl.138.7"></a><var>138.7</var>    Sec. 3. Minnesota Statutes 2006, section 289A.09, subdivision 2, is amended to read:<br/>
<a id="pl.138.8"></a><var>138.8</var>    Subd. 2. <b>Withholding statement to employee or payee and to commissioner.</b> (a) <br/>
<a id="pl.138.9"></a><var>138.9</var>A person required to deduct and withhold from an employee a tax under section 
         <statute_ref>290.92, <br/>
<a id="pl.138.10"></a><var>138.10</var>subdivision 2a
         </statute_ref> or 3, or 
         <statute_ref>290.923, subdivision 2</statute_ref>, or who would have been required to <br/>
<a id="pl.138.11"></a><var>138.11</var>deduct and withhold a tax under section 
         <statute_ref>290.92, subdivision 2a</statute_ref> or 3, or persons required <br/>
<a id="pl.138.12"></a><var>138.12</var>to withhold tax under section 
         <statute_ref>290.923, subdivision 2</statute_ref>, determined without regard to <br/>
<a id="pl.138.13"></a><var>138.13</var>section 
         <statute_ref>290.92, subdivision 19</statute_ref>, if the employee or payee had claimed no more than one <br/>
<a id="pl.138.14"></a><var>138.14</var>withholding exemption, or who paid wages or made payments not subject to withholding <br/>
<a id="pl.138.15"></a><var>138.15</var>under section 
         <statute_ref>290.92, subdivision 2a</statute_ref> or 3, or 
         <statute_ref>290.923, subdivision 2</statute_ref>, to an employee or <br/>
<a id="pl.138.16"></a><var>138.16</var>person receiving royalty payments in excess of $600, or who has entered into a voluntary <br/>
<a id="pl.138.17"></a><var>138.17</var>withholding agreement with a payee under section 
         <statute_ref>290.92, subdivision 20</statute_ref>, must give <br/>
<a id="pl.138.18"></a><var>138.18</var>every employee or person receiving royalty payments in respect to the remuneration paid <br/>
<a id="pl.138.19"></a><var>138.19</var>by the person to the employee or person receiving royalty payments during the calendar <br/>
<a id="pl.138.20"></a><var>138.20</var>year, on or before January 31 of the succeeding year, or, if employment is terminated <br/>
<a id="pl.138.21"></a><var>138.21</var>before the close of the calendar year, within 30 days after the date of receipt of a written <br/>
<a id="pl.138.22"></a><var>138.22</var>request from the employee if the 30-day period ends before January 31, a written statement <br/>
<a id="pl.138.23"></a><var>138.23</var>showing the following: <br/>
<a id="pl.138.24"></a><var>138.24</var>    (1) name of the person;<br/>
<a id="pl.138.25"></a><var>138.25</var>    (2) the name of the employee or payee and the employee's or payee's Social Security <br/>
<a id="pl.138.26"></a><var>138.26</var>account number;<br/>
<a id="pl.138.27"></a><var>138.27</var>    (3) the total amount of wages as that term is defined in section 
         <statute_ref>290.92, subdivision <br/>
<a id="pl.138.28"></a><var>138.28</var>1
         </statute_ref>, paragraph (1); the total amount of remuneration subject to withholding under section <br/>
<statute_ref><a id="pl.138.29"></a><var>138.29</var>290.92, subdivision 20
         </statute_ref>; the amount of sick pay as required under section 6051(f) of the <br/>
<a id="pl.138.30"></a><var>138.30</var>Internal Revenue Code; and the amount of royalties subject to withholding under section <br/>
<statute_ref><a id="pl.138.31"></a><var>138.31</var>290.923, subdivision 2
         </statute_ref>; and <br/>
<a id="pl.138.32"></a><var>138.32</var>    (4) the total amount deducted and withheld as tax under section 
         <statute_ref>290.92, subdivision <br/>
<a id="pl.138.33"></a><var>138.33</var>2a
         </statute_ref> or 3, or 
         <statute_ref>290.923, subdivision 2</statute_ref>. <br/>
<a id="pl.139.1"></a><var>139.1</var>    (b) The statement required to be furnished by this paragraph (a) with respect to any <br/>
<a id="pl.139.2"></a><var>139.2</var>remuneration must be furnished at those times, must contain the information required, and <br/>
<a id="pl.139.3"></a><var>139.3</var>must be in the form the commissioner prescribes.<br/>
<a id="pl.139.4"></a><var>139.4</var>    (c) The commissioner may prescribe rules providing for reasonable extensions of <br/>
<a id="pl.139.5"></a><var>139.5</var>time, not in excess of 30 days, to employers or payers required to give the statements to <br/>
<a id="pl.139.6"></a><var>139.6</var>their employees or payees under this subdivision.<br/>
<a id="pl.139.7"></a><var>139.7</var>    (d) A duplicate of any statement made under this subdivision and in accordance <br/>
<a id="pl.139.8"></a><var>139.8</var>with rules prescribed by the commissioner, along with a reconciliation in the form the <br/>
<a id="pl.139.9"></a><var>139.9</var>commissioner prescribes of the statements for the calendar year, including a reconciliation <br/>
<a id="pl.139.10"></a><var>139.10</var>of the quarterly returns required to be filed under subdivision 1, must be filed with the <br/>
<a id="pl.139.11"></a><var>139.11</var>commissioner on or before February 28 of the year after the payments were made.<br/>
<a id="pl.139.12"></a><var>139.12</var>    (e) If an employer cancels the employer's Minnesota withholding account number <br/>
<a id="pl.139.13"></a><var>139.13</var>required by section 
         <statute_ref>290.92, subdivision 24</statute_ref>, the information required by paragraph (d), <br/>
<a id="pl.139.14"></a><var>139.14</var>must be filed with the commissioner within 30 days of the end of the quarter in which <br/>
<a id="pl.139.15"></a><var>139.15</var>the employer cancels its account number. <br/>
<a id="pl.139.16"></a><var>139.16</var>    (f) The employer must submit the statements required to be sent to the commissioner <br/>
<a id="pl.139.17"></a><var>139.17</var>on magnetic media, if the magnetic media was in the same manner required to satisfy the <br/>
<a id="pl.139.18"></a><var>139.18</var>federal reporting requirements of section 6011(e) of the Internal Revenue Code and the <br/>
<a id="pl.139.19"></a><var>139.19</var>regulations issued under it. For wages paid in calendar year 2008, an employer must <br/>
<a id="pl.139.20"></a><var>139.20</var>submit statements to the commissioner required by this section by electronic means if the <br/>
<a id="pl.139.21"></a><var>139.21</var>employer is required to send more than 100 statements to the commissioner, even though <br/>
<a id="pl.139.22"></a><var>139.22</var>the employer is not required to submit the returns federally by electronic means. For <br/>
<a id="pl.139.23"></a><var>139.23</var>calendar year 2009, the 100 statements threshold is reduced to 50, and for calendar year <br/>
<a id="pl.139.24"></a><var>139.24</var>2010, the threshold is reduced to 25, and for 2011 and after, the threshold is reduced to ten.<br/>
<a id="pl.139.25"></a><var>139.25</var>    (g) A "third-party bulk filer" as defined in section 
         <statute_ref>290.92, subdivision 30</statute_ref>, paragraph <br/>
<a id="pl.139.26"></a><var>139.26</var>(a), clause (2), must submit the returns required by this subdivision and subdivision 1, <br/>
<a id="pl.139.27"></a><var>139.27</var>paragraph (a), with the commissioner by electronic means. <br/>
<a id="pl.139.28"></a><var>139.28</var><b>EFFECTIVE DATE.</b>This section is effective for wages paid after December 31, <br/>
<a id="pl.139.29"></a><var>139.29</var>2007.<br/>
<br/>
<a id="bill.11.4.0"></a><a id="pl.139.30"></a><var>139.30</var>    Sec. 4. Minnesota Statutes 2006, section 289A.12, subdivision 14, is amended to read:<br/>
<a id="pl.139.31"></a><var>139.31</var>    Subd. 14. <b>Regulated investment companies; reporting exempt-interest </b><br/>
<a id="pl.139.32"></a><var>139.32</var><b>dividends.</b> (a) A regulated investment company paying $10 or more in exempt-interest <br/>
<a id="pl.139.33"></a><var>139.33</var>dividends to an individual who is a resident of Minnesota must make a return indicating <br/>
<a id="pl.139.34"></a><var>139.34</var>the amount of the exempt-interest dividends, the name, address, and Social Security <br/>
<a id="pl.139.35"></a><var>139.35</var>number of the recipient, and any other information that the commissioner specifies. The <br/>
<a id="pl.140.1"></a><var>140.1</var>return must be provided to the shareholder no later than 30 days after the close of the <br/>
<a id="pl.140.2"></a><var>140.2</var>taxable year. The return provided to the shareholder must include a clear statement, in the <br/>
<a id="pl.140.3"></a><var>140.3</var>form prescribed by the commissioner, that the exempt-interest dividends must be included <br/>
<a id="pl.140.4"></a><var>140.4</var>in the computation of Minnesota taxable income. The commissioner may by notice and <br/>
<a id="pl.140.5"></a><var>140.5</var>demand require the regulated investment company is required in a manner prescribed by <br/>
<a id="pl.140.6"></a><var>140.6</var>the commissioner to file a copy of the return with the commissioner.<br/>
<a id="pl.140.7"></a><var>140.7</var>    (b) This subdivision applies to regulated investment companies required to register <br/>
<a id="pl.140.8"></a><var>140.8</var>under chapter 80A.<br/>
<a id="pl.140.9"></a><var>140.9</var>    (c) For purposes of this subdivision, the following definitions apply.<br/>
<a id="pl.140.10"></a><var>140.10</var>    (1) "Exempt-interest dividends" mean exempt-interest dividends as defined in <br/>
<a id="pl.140.11"></a><var>140.11</var>section 852(b)(5) of the Internal Revenue Code, but does not include the portion of <br/>
<a id="pl.140.12"></a><var>140.12</var>exempt-interest dividends that are not required to be added to federal taxable income <br/>
<a id="pl.140.13"></a><var>140.13</var>under section 
         <statute_ref>290.01, subdivision 19a</statute_ref>, clause (1)(ii). <br/>
<a id="pl.140.14"></a><var>140.14</var>    (2) "Regulated investment company" means regulated investment company as <br/>
<a id="pl.140.15"></a><var>140.15</var>defined in section 851(a) of the Internal Revenue Code or a fund of the regulated <br/>
<a id="pl.140.16"></a><var>140.16</var>investment company as defined in section 851(g) of the Internal Revenue Code.<br/>
<a id="pl.140.17"></a><var>140.17</var><b>EFFECTIVE DATE.</b>This section is effective for taxable years beginning after <br/>
<a id="pl.140.18"></a><var>140.18</var>December 31, 2007.<br/>
<br/>
<a id="bill.11.5.0"></a><a id="pl.140.19"></a><var>140.19</var>    Sec. 5. Minnesota Statutes 2006, section 289A.18, subdivision 1, is amended to read:<br/>
<a id="pl.140.20"></a><var>140.20</var>    Subdivision 1. <b>Individual income, fiduciary income, corporate franchise, and </b><br/>
<a id="pl.140.21"></a><var>140.21</var><b>entertainment taxes; partnership and S corporation returns; information returns; </b><br/>
<a id="pl.140.22"></a><var>140.22</var><b>mining company returns.</b> The returns required to be made under sections 
         <statute_ref>289A.08</statute_ref> and <br/>
<statute_ref><a id="pl.140.23"></a><var>140.23</var>289A.12
         </statute_ref> must be filed at the following times:<br/>
<a id="pl.140.24"></a><var>140.24</var>    (1) returns made on the basis of the calendar year must be filed on April 15 following <br/>
<a id="pl.140.25"></a><var>140.25</var>the close of the calendar year, except that returns of corporations must be filed on March <br/>
<a id="pl.140.26"></a><var>140.26</var>15 following the close of the calendar year;<br/>
<a id="pl.140.27"></a><var>140.27</var>    (2) returns made on the basis of the fiscal year must be filed on the 15th day of the <br/>
<a id="pl.140.28"></a><var>140.28</var>fourth month following the close of the fiscal year, except that returns of corporations <br/>
<a id="pl.140.29"></a><var>140.29</var>must be filed on the 15th day of the third month following the close of the fiscal year;<br/>
<a id="pl.140.30"></a><var>140.30</var>    (3) returns for a fractional part of a year must be filed on the 15th day of the fourth <br/>
<a id="pl.140.31"></a><var>140.31</var>month following the end of the month in which falls the last day of the period for which <br/>
<a id="pl.140.32"></a><var>140.32</var>the return is made, except that the returns of corporations must be filed on the 15th day of <br/>
<a id="pl.140.33"></a><var>140.33</var>the third month following the end of the tax year of the unitary group in which falls the <br/>
<a id="pl.140.34"></a><var>140.34</var>last day of the period for which the return is made;<br/>
<a id="pl.141.1"></a><var>141.1</var>    (4) in the case of a final return of a decedent for a fractional part of a year, the return <br/>
<a id="pl.141.2"></a><var>141.2</var>must be filed on the 15th day of the fourth month following the close of the 12-month <br/>
<a id="pl.141.3"></a><var>141.3</var>period that began with the first day of that fractional part of a year;<br/>
<a id="pl.141.4"></a><var>141.4</var>    (5) in the case of the return of a cooperative association, returns must be filed on or <br/>
<a id="pl.141.5"></a><var>141.5</var>before the 15th day of the ninth month following the close of the taxable year;<br/>
<a id="pl.141.6"></a><var>141.6</var>    (6) if a corporation has been divested from a unitary group and files a return for <br/>
<a id="pl.141.7"></a><var>141.7</var>a fractional part of a year in which it was a member of a unitary business that files a <br/>
<a id="pl.141.8"></a><var>141.8</var>combined report under section 
         <statute_ref>290.34, subdivision 2</statute_ref>, the divested corporation's return <br/>
<a id="pl.141.9"></a><var>141.9</var>must be filed on the 15th day of the third month following the close of the common <br/>
<a id="pl.141.10"></a><var>141.10</var>accounting period that includes the fractional year;<br/>
<a id="pl.141.11"></a><var>141.11</var>    (7) returns of entertainment entities must be filed on April 15 following the close of <br/>
<a id="pl.141.12"></a><var>141.12</var>the calendar year;<br/>
<a id="pl.141.13"></a><var>141.13</var>    (8) returns required to be filed under section 
         <statute_ref>289A.08, subdivision 4</statute_ref>, must be filed <br/>
<a id="pl.141.14"></a><var>141.14</var>on the 15th day of the fifth month following the close of the taxable year;<br/>
<a id="pl.141.15"></a><var>141.15</var>    (9) returns of mining companies must be filed on May 1 following the close of the <br/>
<a id="pl.141.16"></a><var>141.16</var>calendar year; and<br/>
<a id="pl.141.17"></a><var>141.17</var>    (10) returns required to be filed with the commissioner under section 
         <statute_ref>289A.12, <br/>
<a id="pl.141.18"></a><var>141.18</var>subdivision 2
         </statute_ref>, or 4 to 10, or 14, must be filed within 30 days after being demanded by <br/>
<a id="pl.141.19"></a><var>141.19</var>the commissioner.<br/>
<a id="pl.141.20"></a><var>141.20</var><b>EFFECTIVE DATE.</b>This section is effective for taxable years beginning after <br/>
<a id="pl.141.21"></a><var>141.21</var>December 31, 2007.<br/>
<br/>
<a id="bill.11.6.0"></a><a id="pl.141.22"></a><var>141.22</var>    Sec. 6. Minnesota Statutes 2006, section 289A.38, subdivision 7, is amended to read:<br/>
<a id="pl.141.23"></a><var>141.23</var>    Subd. 7. <b>Federal tax changes.</b> If the amount of income, items of tax preference, <br/>
<a id="pl.141.24"></a><var>141.24</var>deductions, or credits for any year of a taxpayer as reported to the Internal Revenue <br/>
<a id="pl.141.25"></a><var>141.25</var>Service is changed or corrected by the commissioner of Internal Revenue or other officer <br/>
<a id="pl.141.26"></a><var>141.26</var>of the United States or other competent authority, or where a renegotiation of a contract or <br/>
<a id="pl.141.27"></a><var>141.27</var>subcontract with the United States results in a change in income, items of tax preference, <br/>
<a id="pl.141.28"></a><var>141.28</var>deductions, credits, or withholding tax, or, in the case of estate tax, where there are <br/>
<a id="pl.141.29"></a><var>141.29</var>adjustments to the taxable estate resulting in a change to the credit for state death taxes, <br/>
<a id="pl.141.30"></a><var>141.30</var>the taxpayer shall report the change or correction or renegotiation results in writing to the <br/>
<a id="pl.141.31"></a><var>141.31</var>commissioner. The report must be submitted within 180 days after the final determination <br/>
<a id="pl.141.32"></a><var>141.32</var>and must be in the form of either an amended Minnesota estate, withholding tax, corporate <br/>
<a id="pl.141.33"></a><var>141.33</var>franchise tax, or income tax return conceding the accuracy of the federal determination <br/>
<a id="pl.141.34"></a><var>141.34</var>or a letter detailing how the federal determination is incorrect or does not change the <br/>
<a id="pl.141.35"></a><var>141.35</var>Minnesota tax. An amended Minnesota income tax return must be accompanied by an <br/>
<a id="pl.142.1"></a><var>142.1</var>amended property tax refund return, if necessary. A taxpayer filing an amended federal <br/>
<a id="pl.142.2"></a><var>142.2</var>tax return must also file a copy of the amended return with the commissioner of revenue <br/>
<a id="pl.142.3"></a><var>142.3</var>within 180 days after filing the amended return.<br/>
<a id="pl.142.4"></a><var>142.4</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.11.7.0"></a><a id="pl.142.5"></a><var>142.5</var>    Sec. 7. Minnesota Statutes 2006, section 289A.60, subdivision 8, is amended to read:<br/>
<a id="pl.142.6"></a><var>142.6</var>    Subd. 8. <b>Penalty for</b><b> </b><b>Penalties; </b><b>failure to file informational return</b><b>; incorrect </b><br/>
<a id="pl.142.7"></a><var>142.7</var><b>taxpayer identification number</b><b>.</b> (a) In the case of a failure to file an informational return <br/>
<a id="pl.142.8"></a><var>142.8</var>required by section 
         <statute_ref>289A.12</statute_ref> with the commissioner on the date prescribed (determined <br/>
<a id="pl.142.9"></a><var>142.9</var>with regard to any extension of time for filing), the person failing to file the return shall pay <br/>
<a id="pl.142.10"></a><var>142.10</var>a penalty of $50 for each failure or in the case of a partnership, S corporation, or fiduciary <br/>
<a id="pl.142.11"></a><var>142.11</var>return, $50 for each partner, shareholder, or beneficiary; but the total amount imposed on <br/>
<a id="pl.142.12"></a><var>142.12</var>the delinquent person for all failures during any calendar year must not exceed $25,000. If <br/>
<a id="pl.142.13"></a><var>142.13</var>a failure to file a return is due to intentional disregard of the filing requirement, then the <br/>
<a id="pl.142.14"></a><var>142.14</var>penalty imposed under the preceding sentence must not be less than an amount equal to: <br/>
<a id="pl.142.15"></a><var>142.15</var>    (1) in the case of a return not described in clause (2) or (3), ten percent of the <br/>
<a id="pl.142.16"></a><var>142.16</var>aggregate amount of the items required to be reported;<br/>
<a id="pl.142.17"></a><var>142.17</var>    (2) in the case of a return required to be filed under section 
         <statute_ref>289A.12, subdivision 5</statute_ref>, <br/>
<a id="pl.142.18"></a><var>142.18</var>five percent of the gross proceeds required to be reported; and <br/>
<a id="pl.142.19"></a><var>142.19</var>    (3) in the case of a return required to be filed under section 
         <statute_ref>289A.12, subdivision 9</statute_ref>, <br/>
<a id="pl.142.20"></a><var>142.20</var>relating to direct sales, $100 for each failure; however, the total amount imposed on the <br/>
<a id="pl.142.21"></a><var>142.21</var>delinquent person for intentional failures during a calendar year must not exceed $50,000. <br/>
<a id="pl.142.22"></a><var>142.22</var>The penalty must be collected in the same manner as a delinquent income tax. <br/>
<a id="pl.142.23"></a><var>142.23</var>    (b) If a partnership or S corporation files a partnership or S corporation return with <br/>
<a id="pl.142.24"></a><var>142.24</var>an incorrect tax identification number used for a partner or shareholder after being notified <br/>
<a id="pl.142.25"></a><var>142.25</var>by the commissioner that the identification number is incorrect, the partnership or S <br/>
<a id="pl.142.26"></a><var>142.26</var>corporation must pay a penalty of $50 for each such incorrect number.<br/>
<a id="pl.142.27"></a><var>142.27</var><b>EFFECTIVE DATE.</b>This section is effective for returns filed after December <br/>
<a id="pl.142.28"></a><var>142.28</var>31, 2008.<br/>
<br/>
<a id="bill.11.8.0"></a><a id="pl.142.29"></a><var>142.29</var>    Sec. 8. Minnesota Statutes 2006, section 289A.60, subdivision 12, is amended to read:<br/>
<a id="pl.142.30"></a><var>142.30</var>    Subd. 12. <b>Penalties relating to property tax refunds.</b> (a) If it is determined that a <br/>
<a id="pl.142.31"></a><var>142.31</var>property tax refund claim is excessive and was negligently prepared, a claimant is liable <br/>
<a id="pl.142.32"></a><var>142.32</var>for a penalty of ten percent of the corrected claim must be disallowed claim. If the claim <br/>
<a id="pl.142.33"></a><var>142.33</var>has been paid, the amount disallowed must be recovered by assessment and collection.<br/>
<a id="pl.143.1"></a><var>143.1</var>    (b) An owner who without reasonable cause fails to give a certificate of rent <br/>
<a id="pl.143.2"></a><var>143.2</var>constituting property tax to a renter, as required by section 
         <statute_ref>290A.19, paragraph (a)</statute_ref>, is <br/>
<a id="pl.143.3"></a><var>143.3</var>liable to the commissioner for a penalty of $100 for each failure.<br/>
<a id="pl.143.4"></a><var>143.4</var>    (c) If the owner or managing agent knowingly gives rent certificates that report total <br/>
<a id="pl.143.5"></a><var>143.5</var>rent constituting property taxes in excess of the amount of actual rent constituting property <br/>
<a id="pl.143.6"></a><var>143.6</var>taxes paid on the rented part of a property, the owner or managing agent is liable for a <br/>
<a id="pl.143.7"></a><var>143.7</var>penalty equal to the greater of (1) $100 or (2) 50 percent of the excess that is reported. An <br/>
<a id="pl.143.8"></a><var>143.8</var>overstatement of rent constituting property taxes is presumed to be knowingly made if it <br/>
<a id="pl.143.9"></a><var>143.9</var>exceeds by ten percent or more the actual rent constituting property taxes.<br/>
<a id="pl.143.10"></a><var>143.10</var><b>EFFECTIVE DATE.</b>This section is effective for property tax refund claims filed <br/>
<a id="pl.143.11"></a><var>143.11</var>after June 30, 2008.<br/>
<br/>
<a id="bill.11.9.0"></a><a id="pl.143.12"></a><var>143.12</var>    Sec. 9. Minnesota Statutes 2006, section 289A.60, subdivision 27, is amended to read:<br/>
<a id="pl.143.13"></a><var>143.13</var>    Subd. 27. <b>Reportable transaction understatement.</b> (a) If a taxpayer has a <br/>
<a id="pl.143.14"></a><var>143.14</var>reportable transaction understatement for any taxable year, an amount equal to 20 percent <br/>
<a id="pl.143.15"></a><var>143.15</var>of the amount of the reportable transaction understatement must be added to the tax.<br/>
<a id="pl.143.16"></a><var>143.16</var>    (b)(1) For purposes of this subdivision, "reportable transaction understatement" <br/>
<a id="pl.143.17"></a><var>143.17</var>means the product of:<br/>
<a id="pl.143.18"></a><var>143.18</var>    (i) the amount of the increase, if any, in taxable income that results from a difference <br/>
<a id="pl.143.19"></a><var>143.19</var>between the proper tax treatment of an item to which this section applies and the taxpayer's <br/>
<a id="pl.143.20"></a><var>143.20</var>treatment of that item as shown on the taxpayer's tax return; and<br/>
<a id="pl.143.21"></a><var>143.21</var>    (ii) the highest rate of tax imposed on the taxpayer under section 
         <statute_ref>290.06</statute_ref> determined <br/>
<a id="pl.143.22"></a><var>143.22</var>without regard to the understatement.<br/>
<a id="pl.143.23"></a><var>143.23</var>    (2) For purposes of clause (1)(i), any reduction of the excess of deductions allowed <br/>
<a id="pl.143.24"></a><var>143.24</var>for the taxable year over gross income for that year, and any reduction in the amount of <br/>
<a id="pl.143.25"></a><var>143.25</var>capital losses which would, without regard to section 1211 of the Internal Revenue Code, <br/>
<a id="pl.143.26"></a><var>143.26</var>be allowed for that year, must be treated as an increase in taxable income.<br/>
<a id="pl.143.27"></a><var>143.27</var>    (c) This subdivision applies to any item that is attributable to:<br/>
<a id="pl.143.28"></a><var>143.28</var>    (1) any listed transaction under section 
         <statute_ref>289A.121</statute_ref>; and<br/>
<a id="pl.143.29"></a><var>143.29</var>    (2) any reportable transaction, other than a listed transaction, if a significant purpose <br/>
<a id="pl.143.30"></a><var>143.30</var>of that transaction is the avoidance or evasion of federal income tax liability.<br/>
<a id="pl.143.31"></a><var>143.31</var>    (d) Paragraph (a) applies by substituting "30 percent" for "20 percent" with respect <br/>
<a id="pl.143.32"></a><var>143.32</var>to the portion of any reportable transaction understatement with respect to which the <br/>
<a id="pl.143.33"></a><var>143.33</var>disclosure requirements of section 
         <statute_ref>289A.121, subdivision 5</statute_ref>, and section 6664(d)(2)(A) <br/>
<a id="pl.143.34"></a><var>143.34</var>of the Internal Revenue Code are not met.<br/>
<a id="pl.144.1"></a><var>144.1</var>    (e)(1) No penalty applies under this subdivision with respect to any portion of a <br/>
<a id="pl.144.2"></a><var>144.2</var>reportable transaction understatement if the taxpayer shows that there was reasonable <br/>
<a id="pl.144.3"></a><var>144.3</var>cause for the portion and that the taxpayer acted in good faith with respect to the portion. <br/>
<a id="pl.144.4"></a><var>144.4</var>This paragraph applies only if:<br/>
<a id="pl.144.5"></a><var>144.5</var>    (i) the relevant facts affecting the tax treatment of the item are adequately disclosed <br/>
<a id="pl.144.6"></a><var>144.6</var>as required under section 
         <statute_ref>289A.121</statute_ref>;<br/>
<a id="pl.144.7"></a><var>144.7</var>    (ii) there is or was substantial authority for the treatment; and<br/>
<a id="pl.144.8"></a><var>144.8</var>    (iii) the taxpayer reasonably believed that the treatment was more likely than not <br/>
<a id="pl.144.9"></a><var>144.9</var>the proper treatment.<br/>
<a id="pl.144.10"></a><var>144.10</var>    (2) A taxpayer who did not adequately disclose under section 
         <statute_ref>289A.121</statute_ref> meets <br/>
<a id="pl.144.11"></a><var>144.11</var>the requirements of clause (1)(i), if the commissioner abates the penalty imposed by <br/>
<a id="pl.144.12"></a><var>144.12</var>subdivision 26, paragraph (d), under section 
<statute_ref>270C.34</statute_ref> subdivision 26, paragraph (g).<br/>
<a id="pl.144.13"></a><var>144.13</var>    (3) For purposes of clause (1)(iii), a taxpayer is treated as having a reasonable belief <br/>
<a id="pl.144.14"></a><var>144.14</var>with respect to the tax treatment of an item only if the belief:<br/>
<a id="pl.144.15"></a><var>144.15</var>    (i) is based on the facts and law that exist when the return of tax which includes the <br/>
<a id="pl.144.16"></a><var>144.16</var>tax treatment is filed; and<br/>
<a id="pl.144.17"></a><var>144.17</var>    (ii) relates solely to the taxpayer's chances of success on the merits of the treatment <br/>
<a id="pl.144.18"></a><var>144.18</var>and does not take into account the possibility that a return will not be audited, the <br/>
<a id="pl.144.19"></a><var>144.19</var>treatment will not be raised on audit, or the treatment will be resolved through settlement <br/>
<a id="pl.144.20"></a><var>144.20</var>if it is raised.<br/>
<a id="pl.144.21"></a><var>144.21</var>    (4) An opinion of a tax advisor may not be relied upon to establish the reasonable <br/>
<a id="pl.144.22"></a><var>144.22</var>belief of a taxpayer if:<br/>
<a id="pl.144.23"></a><var>144.23</var>    (i) the tax advisor:<br/>
<a id="pl.144.24"></a><var>144.24</var>    (A) is a material advisor, as defined in section 
         <statute_ref>289A.121</statute_ref>, and participates in the <br/>
<a id="pl.144.25"></a><var>144.25</var>organization, management, promotion, or sale of the transaction or is related (within the <br/>
<a id="pl.144.26"></a><var>144.26</var>meaning of section 267(b) or 707(b)(1) of the Internal Revenue Code) to any person <br/>
<a id="pl.144.27"></a><var>144.27</var>who so participates;<br/>
<a id="pl.144.28"></a><var>144.28</var>    (B) is compensated directly or indirectly by a material advisor with respect to the <br/>
<a id="pl.144.29"></a><var>144.29</var>transaction;<br/>
<a id="pl.144.30"></a><var>144.30</var>    (C) has a fee arrangement with respect to the transaction which is contingent on all <br/>
<a id="pl.144.31"></a><var>144.31</var>or part of the intended tax benefits from the transaction being sustained; or<br/>
<a id="pl.144.32"></a><var>144.32</var>    (D) has a disqualifying financial interest with respect to the transaction, as <br/>
<a id="pl.144.33"></a><var>144.33</var>determined under United States Treasury regulations prescribed to implement the <br/>
<a id="pl.144.34"></a><var>144.34</var>provisions of section 6664(d)(3)(B)(ii)(IV) of the Internal Revenue Code; or<br/>
<a id="pl.144.35"></a><var>144.35</var>    (ii) the opinion:<br/>
<a id="pl.145.1"></a><var>145.1</var>    (A) is based on unreasonable factual or legal assumptions, including assumptions <br/>
<a id="pl.145.2"></a><var>145.2</var>as to future events;<br/>
<a id="pl.145.3"></a><var>145.3</var>    (B) unreasonably relies on representations, statements, findings, or agreements of <br/>
<a id="pl.145.4"></a><var>145.4</var>the taxpayer or any other person;<br/>
<a id="pl.145.5"></a><var>145.5</var>    (C) does not identify and consider all relevant facts; or<br/>
<a id="pl.145.6"></a><var>145.6</var>    (D) fails to meet any other requirement as the Secretary of the Treasury may <br/>
<a id="pl.145.7"></a><var>145.7</var>prescribe under federal law.<br/>
<a id="pl.145.8"></a><var>145.8</var>    (f) The penalty imposed by this subdivision applies in lieu of the penalty imposed <br/>
<a id="pl.145.9"></a><var>145.9</var>under subdivision 4.<br/>
<a id="pl.145.10"></a><var>145.10</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.11.10.0"></a><a id="pl.145.11"></a><var>145.11</var>    Sec. 10. Minnesota Statutes 2006, section 289A.60, is amended by adding a <br/>
<a id="pl.145.12"></a><var>145.12</var>subdivision to read:<br/>
<a id="pl.145.13"></a><var>145.13</var>    Subd. 28. <b>Preparer identification number.</b> Any Minnesota individual income tax <br/>
<a id="pl.145.14"></a><var>145.14</var>return or claim for refund prepared by a "tax refund or return preparer" as defined in <br/>
<a id="pl.145.15"></a><var>145.15</var>subdivision 13, paragraph (f), shall bear the identification number the preparer is required <br/>
<a id="pl.145.16"></a><var>145.16</var>to use federally under section 6109(a)(4) of the Internal Revenue Code. A tax refund <br/>
<a id="pl.145.17"></a><var>145.17</var>or return preparer who prepares a Minnesota individual income tax return or claim for <br/>
<a id="pl.145.18"></a><var>145.18</var>refund and fails to include the required number on the return or claim is subject to a <br/>
<a id="pl.145.19"></a><var>145.19</var>penalty of $50 for each failure.<br/>
<a id="pl.145.20"></a><var>145.20</var><b>EFFECTIVE DATE.</b>This section is effective for returns prepared for taxable <br/>
<a id="pl.145.21"></a><var>145.21</var>years beginning after December 31, 2007.<br/>
<br/>
<a id="bill.11.11.0"></a><a id="pl.145.22"></a><var>145.22</var>    Sec. 11. Minnesota Statutes 2007 Supplement, section 290.01, subdivision 19b, <br/>
<a id="pl.145.23"></a><var>145.23</var>is amended to read:<br/>
<a id="pl.145.24"></a><var>145.24</var>    Subd. 19b. <b>Subtractions from federal taxable income.</b> For individuals, estates, <br/>
<a id="pl.145.25"></a><var>145.25</var>and trusts, there shall be subtracted from federal taxable income:<br/>
<a id="pl.145.26"></a><var>145.26</var>    (1) net interest income on obligations of any authority, commission, or <br/>
<a id="pl.145.27"></a><var>145.27</var>instrumentality of the United States to the extent includable in taxable income for federal <br/>
<a id="pl.145.28"></a><var>145.28</var>income tax purposes but exempt from state income tax under the laws of the United States;<br/>
<a id="pl.145.29"></a><var>145.29</var>    (2) if included in federal taxable income, the amount of any overpayment of income <br/>
<a id="pl.145.30"></a><var>145.30</var>tax to Minnesota or to any other state, for any previous taxable year, whether the amount <br/>
<a id="pl.145.31"></a><var>145.31</var>is received as a refund or as a credit to another taxable year's income tax liability;<br/>
<a id="pl.145.32"></a><var>145.32</var>    (3) the amount paid to others, less the amount used to claim the credit allowed under <br/>
<a id="pl.145.33"></a><var>145.33</var>section 
         <statute_ref>290.0674</statute_ref>, not to exceed $1,625 for each qualifying child in grades kindergarten <br/>
<a id="pl.146.1"></a><var>146.1</var>to 6 and $2,500 for each qualifying child in grades 7 to 12, for tuition, textbooks, and <br/>
<a id="pl.146.2"></a><var>146.2</var>transportation of each qualifying child in attending an elementary or secondary school <br/>
<a id="pl.146.3"></a><var>146.3</var>situated in Minnesota, North Dakota, South Dakota, Iowa, or Wisconsin, wherein a <br/>
<a id="pl.146.4"></a><var>146.4</var>resident of this state may legally fulfill the state's compulsory attendance laws, which <br/>
<a id="pl.146.5"></a><var>146.5</var>is not operated for profit, and which adheres to the provisions of the Civil Rights Act <br/>
<a id="pl.146.6"></a><var>146.6</var>of 1964 and chapter 363A. For the purposes of this clause, "tuition" includes fees or <br/>
<a id="pl.146.7"></a><var>146.7</var>tuition as defined in section 
         <statute_ref>290.0674, subdivision 1</statute_ref>, clause (1). As used in this clause, <br/>
<a id="pl.146.8"></a><var>146.8</var>"textbooks" includes books and other instructional materials and equipment purchased <br/>
<a id="pl.146.9"></a><var>146.9</var>or leased for use in elementary and secondary schools in teaching only those subjects <br/>
<a id="pl.146.10"></a><var>146.10</var>legally and commonly taught in public elementary and secondary schools in this state. <br/>
<a id="pl.146.11"></a><var>146.11</var>Equipment expenses qualifying for deduction includes expenses as defined and limited in <br/>
<a id="pl.146.12"></a><var>146.12</var>section 
         <statute_ref>290.0674, subdivision 1</statute_ref>, clause (3). "Textbooks" does not include instructional <br/>
<a id="pl.146.13"></a><var>146.13</var>books and materials used in the teaching of religious tenets, doctrines, or worship, the <br/>
<a id="pl.146.14"></a><var>146.14</var>purpose of which is to instill such tenets, doctrines, or worship, nor does it include books <br/>
<a id="pl.146.15"></a><var>146.15</var>or materials for, or transportation to, extracurricular activities including sporting events, <br/>
<a id="pl.146.16"></a><var>146.16</var>musical or dramatic events, speech activities, driver's education, or similar programs. For <br/>
<a id="pl.146.17"></a><var>146.17</var>purposes of the subtraction provided by this clause, "qualifying child" has the meaning <br/>
<a id="pl.146.18"></a><var>146.18</var>given in section 32(c)(3) of the Internal Revenue Code;<br/>
<a id="pl.146.19"></a><var>146.19</var>    (4) income as provided under section 
         <statute_ref>290.0802</statute_ref>;<br/>
<a id="pl.146.20"></a><var>146.20</var>    (5) to the extent included in federal adjusted gross income, income realized on <br/>
<a id="pl.146.21"></a><var>146.21</var>disposition of property exempt from tax under section 
         <statute_ref>290.491</statute_ref>;<br/>
<a id="pl.146.22"></a><var>146.22</var>    (6) to the extent not deducted or not deductible pursuant to section 408(d)(8)(E) <br/>
<a id="pl.146.23"></a><var>146.23</var>of the Internal Revenue Code in determining federal taxable income by an individual <br/>
<a id="pl.146.24"></a><var>146.24</var>who does not itemize deductions for federal income tax purposes for the taxable year, an <br/>
<a id="pl.146.25"></a><var>146.25</var>amount equal to 50 percent of the excess of charitable contributions over $500 allowable <br/>
<a id="pl.146.26"></a><var>146.26</var>as a deduction for the taxable year under section 170(a) of the Internal Revenue Code and <br/>
<a id="pl.146.27"></a><var>146.27</var>under the provisions of Public Law 109-1;<br/>
<a id="pl.146.28"></a><var>146.28</var>    (7) for taxable years beginning before January 1, 2008, the amount of the federal <br/>
<a id="pl.146.29"></a><var>146.29</var>small ethanol producer credit allowed under section 40(a)(3) of the Internal Revenue Code <br/>
<a id="pl.146.30"></a><var>146.30</var>which is included in gross income under section 87 of the Internal Revenue Code;<br/>
<a id="pl.146.31"></a><var>146.31</var>    (8) for individuals who are allowed a federal foreign tax credit for taxes that do not <br/>
<a id="pl.146.32"></a><var>146.32</var>qualify for a credit under section 
         <statute_ref>290.06, subdivision 22</statute_ref>, an amount equal to the carryover <br/>
<a id="pl.146.33"></a><var>146.33</var>of subnational foreign taxes for the taxable year, but not to exceed the total subnational <br/>
<a id="pl.146.34"></a><var>146.34</var>foreign taxes reported in claiming the foreign tax credit. For purposes of this clause, <br/>
<a id="pl.146.35"></a><var>146.35</var>"federal foreign tax credit" means the credit allowed under section 27 of the Internal <br/>
<a id="pl.146.36"></a><var>146.36</var>Revenue Code, and "carryover of subnational foreign taxes" equals the carryover allowed <br/>
<a id="pl.147.1"></a><var>147.1</var>under section 904(c) of the Internal Revenue Code minus national level foreign taxes to <br/>
<a id="pl.147.2"></a><var>147.2</var>the extent they exceed the federal foreign tax credit;<br/>
<a id="pl.147.3"></a><var>147.3</var>    (9) in each of the five tax years immediately following the tax year in which an <br/>
<a id="pl.147.4"></a><var>147.4</var>addition is required under subdivision 19a, clause (7), or 19c, clause (15) (14), in the case <br/>
<a id="pl.147.5"></a><var>147.5</var>of a shareholder of a corporation that is an S corporation, an amount equal to one-fifth <br/>
<a id="pl.147.6"></a><var>147.6</var>of the delayed depreciation. For purposes of this clause, "delayed depreciation" means <br/>
<a id="pl.147.7"></a><var>147.7</var>the amount of the addition made by the taxpayer under subdivision 19a, clause (7), or <br/>
<a id="pl.147.8"></a><var>147.8</var>subdivision 19c, clause (15) (14), in the case of a shareholder of an S corporation, minus <br/>
<a id="pl.147.9"></a><var>147.9</var>the positive value of any net operating loss under section 172 of the Internal Revenue <br/>
<a id="pl.147.10"></a><var>147.10</var>Code generated for the tax year of the addition. The resulting delayed depreciation <br/>
<a id="pl.147.11"></a><var>147.11</var>cannot be less than zero;<br/>
<a id="pl.147.12"></a><var>147.12</var>    (10) job opportunity building zone income as provided under section 
         <statute_ref>469.316</statute_ref>;<br/>
<a id="pl.147.13"></a><var>147.13</var>    (11) to the extent included in federal taxable income, the amount of compensation <br/>
<a id="pl.147.14"></a><var>147.14</var>paid to members of the Minnesota National Guard or other reserve components of the <br/>
<a id="pl.147.15"></a><var>147.15</var>United States military for active service performed in Minnesota, excluding compensation <br/>
<a id="pl.147.16"></a><var>147.16</var>for services performed under the Active Guard Reserve (AGR) program. For purposes of <br/>
<a id="pl.147.17"></a><var>147.17</var>this clause, "active service" means (i) state active service as defined in section 
         <statute_ref>190.05, <br/>
<a id="pl.147.18"></a><var>147.18</var>subdivision 5a
         </statute_ref>, clause (1); (ii) federally funded state active service as defined in section <br/>
<statute_ref><a id="pl.147.19"></a><var>147.19</var>190.05, subdivision 5b
         </statute_ref>; or (iii) federal active service as defined in section 
         <statute_ref>190.05, <br/>
<a id="pl.147.20"></a><var>147.20</var>subdivision 5c
         </statute_ref>, but "active service" excludes services performed exclusively for purposes <br/>
<a id="pl.147.21"></a><var>147.21</var>of basic combat training, advanced individual training, annual training, and periodic <br/>
<a id="pl.147.22"></a><var>147.22</var>inactive duty training; special training periodically made available to reserve members; <br/>
<a id="pl.147.23"></a><var>147.23</var>and service performed in accordance with section 
         <statute_ref>190.08, subdivision 3</statute_ref>;<br/>
<a id="pl.147.24"></a><var>147.24</var>    (12) to the extent included in federal taxable income, the amount of compensation <br/>
<a id="pl.147.25"></a><var>147.25</var>paid to Minnesota residents who are members of the armed forces of the United States or <br/>
<a id="pl.147.26"></a><var>147.26</var>United Nations for active duty performed outside Minnesota;<br/>
<a id="pl.147.27"></a><var>147.27</var>    (13) an amount, not to exceed $10,000, equal to qualified expenses related to a <br/>
<a id="pl.147.28"></a><var>147.28</var>qualified donor's donation, while living, of one or more of the qualified donor's organs <br/>
<a id="pl.147.29"></a><var>147.29</var>to another person for human organ transplantation. For purposes of this clause, "organ" <br/>
<a id="pl.147.30"></a><var>147.30</var>means all or part of an individual's liver, pancreas, kidney, intestine, lung, or bone marrow; <br/>
<a id="pl.147.31"></a><var>147.31</var>"human organ transplantation" means the medical procedure by which transfer of a human <br/>
<a id="pl.147.32"></a><var>147.32</var>organ is made from the body of one person to the body of another person; "qualified <br/>
<a id="pl.147.33"></a><var>147.33</var>expenses" means unreimbursed expenses for both the individual and the qualified donor <br/>
<a id="pl.147.34"></a><var>147.34</var>for (i) travel, (ii) lodging, and (iii) lost wages net of sick pay, except that such expenses <br/>
<a id="pl.147.35"></a><var>147.35</var>may be subtracted under this clause only once; and "qualified donor" means the individual <br/>
<a id="pl.147.36"></a><var>147.36</var>or the individual's dependent, as defined in section 152 of the Internal Revenue Code. An <br/>
<a id="pl.148.1"></a><var>148.1</var>individual may claim the subtraction in this clause for each instance of organ donation for <br/>
<a id="pl.148.2"></a><var>148.2</var>transplantation during the taxable year in which the qualified expenses occur;<br/>
<a id="pl.148.3"></a><var>148.3</var>    (14) in each of the five tax years immediately following the tax year in which an <br/>
<a id="pl.148.4"></a><var>148.4</var>addition is required under subdivision 19a, clause (8), or 19c, clause (16) (15), in the case <br/>
<a id="pl.148.5"></a><var>148.5</var>of a shareholder of a corporation that is an S corporation, an amount equal to one-fifth <br/>
<a id="pl.148.6"></a><var>148.6</var>of the addition made by the taxpayer under subdivision 19a, clause (8), or 19c, clause <br/>
<a id="pl.148.7"></a><var>148.7</var>(16) (15), in the case of a shareholder of a corporation that is an S corporation, minus the <br/>
<a id="pl.148.8"></a><var>148.8</var>positive value of any net operating loss under section 172 of the Internal Revenue Code <br/>
<a id="pl.148.9"></a><var>148.9</var>generated for the tax year of the addition. If the net operating loss exceeds the addition for <br/>
<a id="pl.148.10"></a><var>148.10</var>the tax year, a subtraction is not allowed under this clause;<br/>
<a id="pl.148.11"></a><var>148.11</var>    (15) to the extent included in federal taxable income, compensation paid to a <br/>
<a id="pl.148.12"></a><var>148.12</var>nonresident who is a service member as defined in United States Code, title 10, section <br/>
<a id="pl.148.13"></a><var>148.13</var>101(a)(5), for military service as defined in the Service Member Civil Relief Act, Public <br/>
<a id="pl.148.14"></a><var>148.14</var>Law 108-189, section 101(2); and<br/>
<a id="pl.148.15"></a><var>148.15</var>    (16) international economic development zone income as provided under section <br/>
<statute_ref><a id="pl.148.16"></a><var>148.16</var>469.325
         </statute_ref>.<br/>
<a id="pl.148.17"></a><var>148.17</var><b>EFFECTIVE DATE.</b>Clauses (9) and (14) of this section are effective the day <br/>
<a id="pl.148.18"></a><var>148.18</var>following final enactment. Clauses (11) and (12) are effective retroactively for taxable <br/>
<a id="pl.148.19"></a><var>148.19</var>years beginning after December 31, 2004.<br/>
<br/>
<a id="bill.11.12.0"></a><a id="pl.148.20"></a><var>148.20</var>    Sec. 12. Minnesota Statutes 2006, section 290.01, subdivision 19d, is amended to read:<br/>
<a id="pl.148.21"></a><var>148.21</var>    Subd. 19d. <b>Corporations; modifications decreasing federal taxable income.</b> For <br/>
<a id="pl.148.22"></a><var>148.22</var>corporations, there shall be subtracted from federal taxable income after the increases <br/>
<a id="pl.148.23"></a><var>148.23</var>provided in subdivision 19c:<br/>
<a id="pl.148.24"></a><var>148.24</var>    (1) the amount of foreign dividend gross-up added to gross income for federal <br/>
<a id="pl.148.25"></a><var>148.25</var>income tax purposes under section 78 of the Internal Revenue Code;<br/>
<a id="pl.148.26"></a><var>148.26</var>    (2) the amount of salary expense not allowed for federal income tax purposes due <br/>
<a id="pl.148.27"></a><var>148.27</var>to claiming the federal jobs work opportunity credit under section 51 of the Internal <br/>
<a id="pl.148.28"></a><var>148.28</var>Revenue Code;<br/>
<a id="pl.148.29"></a><var>148.29</var>    (3) any dividend (not including any distribution in liquidation) paid within the <br/>
<a id="pl.148.30"></a><var>148.30</var>taxable year by a national or state bank to the United States, or to any instrumentality of <br/>
<a id="pl.148.31"></a><var>148.31</var>the United States exempt from federal income taxes, on the preferred stock of the bank <br/>
<a id="pl.148.32"></a><var>148.32</var>owned by the United States or the instrumentality;<br/>
<a id="pl.148.33"></a><var>148.33</var>    (4) amounts disallowed for intangible drilling costs due to differences between <br/>
<a id="pl.148.34"></a><var>148.34</var>this chapter and the Internal Revenue Code in taxable years beginning before January <br/>
<a id="pl.148.35"></a><var>148.35</var>1, 1987, as follows:<br/>
<a id="pl.149.1"></a><var>149.1</var>    (i) to the extent the disallowed costs are represented by physical property, an amount <br/>
<a id="pl.149.2"></a><var>149.2</var>equal to the allowance for depreciation under Minnesota Statutes 1986, section 
         <statute_ref>290.09, <br/>
<a id="pl.149.3"></a><var>149.3</var>subdivision 7
         </statute_ref>, subject to the modifications contained in subdivision 19e; and<br/>
<a id="pl.149.4"></a><var>149.4</var>    (ii) to the extent the disallowed costs are not represented by physical property, an <br/>
<a id="pl.149.5"></a><var>149.5</var>amount equal to the allowance for cost depletion under Minnesota Statutes 1986, section <br/>
<statute_ref><a id="pl.149.6"></a><var>149.6</var>290.09, subdivision 8
         </statute_ref>;<br/>
<a id="pl.149.7"></a><var>149.7</var>    (5) the deduction for capital losses pursuant to sections 1211 and 1212 of the <br/>
<a id="pl.149.8"></a><var>149.8</var>Internal Revenue Code, except that:<br/>
<a id="pl.149.9"></a><var>149.9</var>    (i) for capital losses incurred in taxable years beginning after December 31, 1986, <br/>
<a id="pl.149.10"></a><var>149.10</var>capital loss carrybacks shall not be allowed;<br/>
<a id="pl.149.11"></a><var>149.11</var>    (ii) for capital losses incurred in taxable years beginning after December 31, 1986, <br/>
<a id="pl.149.12"></a><var>149.12</var>a capital loss carryover to each of the 15 taxable years succeeding the loss year shall be <br/>
<a id="pl.149.13"></a><var>149.13</var>allowed;<br/>
<a id="pl.149.14"></a><var>149.14</var>    (iii) for capital losses incurred in taxable years beginning before January 1, 1987, a <br/>
<a id="pl.149.15"></a><var>149.15</var>capital loss carryback to each of the three taxable years preceding the loss year, subject to <br/>
<a id="pl.149.16"></a><var>149.16</var>the provisions of Minnesota Statutes 1986, section 
         <statute_ref>290.16</statute_ref>, shall be allowed; and<br/>
<a id="pl.149.17"></a><var>149.17</var>    (iv) for capital losses incurred in taxable years beginning before January 1, 1987, <br/>
<a id="pl.149.18"></a><var>149.18</var>a capital loss carryover to each of the five taxable years succeeding the loss year to the <br/>
<a id="pl.149.19"></a><var>149.19</var>extent such loss was not used in a prior taxable year and subject to the provisions of <br/>
<a id="pl.149.20"></a><var>149.20</var>Minnesota Statutes 1986, section 
         <statute_ref>290.16</statute_ref>, shall be allowed;<br/>
<a id="pl.149.21"></a><var>149.21</var>    (6) an amount for interest and expenses relating to income not taxable for federal <br/>
<a id="pl.149.22"></a><var>149.22</var>income tax purposes, if (i) the income is taxable under this chapter and (ii) the interest and <br/>
<a id="pl.149.23"></a><var>149.23</var>expenses were disallowed as deductions under the provisions of section 171(a)(2), 265 or <br/>
<a id="pl.149.24"></a><var>149.24</var>291 of the Internal Revenue Code in computing federal taxable income;<br/>
<a id="pl.149.25"></a><var>149.25</var>    (7) in the case of mines, oil and gas wells, other natural deposits, and timber for <br/>
<a id="pl.149.26"></a><var>149.26</var>which percentage depletion was disallowed pursuant to subdivision 19c, clause (11) (9), a <br/>
<a id="pl.149.27"></a><var>149.27</var>reasonable allowance for depletion based on actual cost. In the case of leases the deduction <br/>
<a id="pl.149.28"></a><var>149.28</var>must be apportioned between the lessor and lessee in accordance with rules prescribed <br/>
<a id="pl.149.29"></a><var>149.29</var>by the commissioner. In the case of property held in trust, the allowable deduction must <br/>
<a id="pl.149.30"></a><var>149.30</var>be apportioned between the income beneficiaries and the trustee in accordance with the <br/>
<a id="pl.149.31"></a><var>149.31</var>pertinent provisions of the trust, or if there is no provision in the instrument, on the basis <br/>
<a id="pl.149.32"></a><var>149.32</var>of the trust's income allocable to each;<br/>
<a id="pl.149.33"></a><var>149.33</var>    (8) for certified pollution control facilities placed in service in a taxable year <br/>
<a id="pl.149.34"></a><var>149.34</var>beginning before December 31, 1986, and for which amortization deductions were elected <br/>
<a id="pl.149.35"></a><var>149.35</var>under section 169 of the Internal Revenue Code of 1954, as amended through December <br/>
<a id="pl.150.1"></a><var>150.1</var>31, 1985, an amount equal to the allowance for depreciation under Minnesota Statutes <br/>
<a id="pl.150.2"></a><var>150.2</var>1986, section 
         <statute_ref>290.09, subdivision 7</statute_ref>;<br/>
<a id="pl.150.3"></a><var>150.3</var>    (9) amounts included in federal taxable income that are due to refunds of income, <br/>
<a id="pl.150.4"></a><var>150.4</var>excise, or franchise taxes based on net income or related minimum taxes paid by the <br/>
<a id="pl.150.5"></a><var>150.5</var>corporation to Minnesota, another state, a political subdivision of another state, the <br/>
<a id="pl.150.6"></a><var>150.6</var>District of Columbia, or a foreign country or possession of the United States to the extent <br/>
<a id="pl.150.7"></a><var>150.7</var>that the taxes were added to federal taxable income under section 
         <statute_ref>290.01, subdivision 19c</statute_ref>, <br/>
<a id="pl.150.8"></a><var>150.8</var>clause (1), in a prior taxable year;<br/>
<a id="pl.150.9"></a><var>150.9</var>    (10) 80 percent of royalties, fees, or other like income accrued or received from a <br/>
<a id="pl.150.10"></a><var>150.10</var>foreign operating corporation or a foreign corporation which is part of the same unitary <br/>
<a id="pl.150.11"></a><var>150.11</var>business as the receiving corporation;<br/>
<a id="pl.150.12"></a><var>150.12</var>    (11) income or gains from the business of mining as defined in section 
         <statute_ref>290.05, <br/>
<a id="pl.150.13"></a><var>150.13</var>subdivision 1
         </statute_ref>, clause (a), that are not subject to Minnesota franchise tax;<br/>
<a id="pl.150.14"></a><var>150.14</var>    (12) the amount of disability access expenditures in the taxable year which are not <br/>
<a id="pl.150.15"></a><var>150.15</var>allowed to be deducted or capitalized under section 44(d)(7) of the Internal Revenue Code;<br/>
<a id="pl.150.16"></a><var>150.16</var>    (13) the amount of qualified research expenses not allowed for federal income tax <br/>
<a id="pl.150.17"></a><var>150.17</var>purposes under section 280C(c) of the Internal Revenue Code, but only to the extent that <br/>
<a id="pl.150.18"></a><var>150.18</var>the amount exceeds the amount of the credit allowed under section 
         <statute_ref>290.068</statute_ref>;<br/>
<a id="pl.150.19"></a><var>150.19</var>    (14) the amount of salary expenses not allowed for federal income tax purposes due <br/>
<a id="pl.150.20"></a><var>150.20</var>to claiming the Indian employment credit under section 45A(a) of the Internal Revenue <br/>
<a id="pl.150.21"></a><var>150.21</var>Code;<br/>
<a id="pl.150.22"></a><var>150.22</var>    (15) the amount of any refund of environmental taxes paid under section 59A of the <br/>
<a id="pl.150.23"></a><var>150.23</var>Internal Revenue Code;<br/>
<a id="pl.150.24"></a><var>150.24</var>    (16) (15) for taxable years beginning before January 1, 2008, the amount of the <br/>
<a id="pl.150.25"></a><var>150.25</var>federal small ethanol producer credit allowed under section 40(a)(3) of the Internal <br/>
<a id="pl.150.26"></a><var>150.26</var>Revenue Code which is included in gross income under section 87 of the Internal Revenue <br/>
<a id="pl.150.27"></a><var>150.27</var>Code;<br/>
<a id="pl.150.28"></a><var>150.28</var>    (17) (16) for a corporation whose foreign sales corporation, as defined in section <br/>
<a id="pl.150.29"></a><var>150.29</var>922 of the Internal Revenue Code, constituted a foreign operating corporation during any <br/>
<a id="pl.150.30"></a><var>150.30</var>taxable year ending before January 1, 1995, and a return was filed by August 15, 1996, <br/>
<a id="pl.150.31"></a><var>150.31</var>claiming the deduction under section 
         <statute_ref>290.21, subdivision 4</statute_ref>, for income received from <br/>
<a id="pl.150.32"></a><var>150.32</var>the foreign operating corporation, an amount equal to 
         <statute_ref>1.23</statute_ref> multiplied by the amount of <br/>
<a id="pl.150.33"></a><var>150.33</var>income excluded under section 114 of the Internal Revenue Code, provided the income is <br/>
<a id="pl.150.34"></a><var>150.34</var>not income of a foreign operating company;<br/>
<a id="pl.151.1"></a><var>151.1</var>    (18) (17) any decrease in subpart F income, as defined in section 952(a) of the <br/>
<a id="pl.151.2"></a><var>151.2</var>Internal Revenue Code, for the taxable year when subpart F income is calculated without <br/>
<a id="pl.151.3"></a><var>151.3</var>regard to the provisions of section 614 103 of Public Law 107-147 109-222;<br/>
<a id="pl.151.4"></a><var>151.4</var>    (19) (16) in each of the five tax years immediately following the tax year in which <br/>
<a id="pl.151.5"></a><var>151.5</var>an addition is required under subdivision 19c, clause (15), an amount equal to one-fifth <br/>
<a id="pl.151.6"></a><var>151.6</var>of the delayed depreciation. For purposes of this clause, "delayed depreciation" means <br/>
<a id="pl.151.7"></a><var>151.7</var>the amount of the addition made by the taxpayer under subdivision 19c, clause (15). The <br/>
<a id="pl.151.8"></a><var>151.8</var>resulting delayed depreciation cannot be less than zero; and<br/>
<a id="pl.151.9"></a><var>151.9</var>    (20) (17) in each of the five tax years immediately following the tax year in which an <br/>
<a id="pl.151.10"></a><var>151.10</var>addition is required under subdivision 19c, clause (16), an amount equal to one-fifth of the <br/>
<a id="pl.151.11"></a><var>151.11</var>amount of the addition.<br/>
<a id="pl.151.12"></a><var>151.12</var><b>EFFECTIVE DATE.</b>The amendment to clause (2) is effective the day following <br/>
<a id="pl.151.13"></a><var>151.13</var>final enactment. The rest of this section is effective for taxable years beginning after <br/>
<a id="pl.151.14"></a><var>151.14</var>December 31, 2007.<br/>
<br/>
<a id="bill.11.13.0"></a><a id="pl.151.15"></a><var>151.15</var>    Sec. 13. Minnesota Statutes 2006, section 290.06, subdivision 33, is amended to read:<br/>
<a id="pl.151.16"></a><var>151.16</var>    Subd. 33. <b>Bovine testing credit.</b> (a) An owner of cattle in Minnesota may take a <br/>
<a id="pl.151.17"></a><var>151.17</var>credit against the tax due under this chapter for an amount equal to one-half the expenses <br/>
<a id="pl.151.18"></a><var>151.18</var>incurred during the taxable year to conduct tuberculosis testing on those cattle. <br/>
<a id="pl.151.19"></a><var>151.19</var>    (b) If the amount of credit which the taxpayer is eligible to receive under this <br/>
<a id="pl.151.20"></a><var>151.20</var>subdivision exceeds the taxpayer's tax liability under this chapter, the commissioner of <br/>
<a id="pl.151.21"></a><var>151.21</var>revenue shall refund the excess to the taxpayer.<br/>
<a id="pl.151.22"></a><var>151.22</var>    (c) The amount necessary to pay claims for the refund provided in this subdivision is <br/>
<a id="pl.151.23"></a><var>151.23</var>appropriated from the general fund to the commissioner of revenue.<br/>
<a id="pl.151.24"></a><var>151.24</var>    (d) Expenses incurred in a calendar year in which tuberculosis testing of cattle in <br/>
<a id="pl.151.25"></a><var>151.25</var>Minnesota is not federally required are not allowed in claiming the credit under paragraph <br/>
<a id="pl.151.26"></a><var>151.26</var>(a).<br/>
<a id="pl.151.27"></a><var>151.27</var><b>EFFECTIVE DATE.</b>This section is effective for taxable years beginning after <br/>
<a id="pl.151.28"></a><var>151.28</var>December 31, 2007.<br/>
<br/>
<a id="bill.11.14.0"></a><a id="pl.151.29"></a><var>151.29</var>    Sec. 14. Minnesota Statutes 2006, section 290.067, subdivision 2b, is amended to read:<br/>
<a id="pl.151.30"></a><var>151.30</var>    Subd. 2b. <b>Inflation adjustment.</b> The commissioner shall adjust the dollar amount <br/>
<a id="pl.151.31"></a><var>151.31</var>of the income threshold at which the maximum credit begins to be reduced under <br/>
<a id="pl.151.32"></a><var>151.32</var>subdivision 2 must be adjusted for inflation. The commissioner shall make the inflation <br/>
<a id="pl.151.33"></a><var>151.33</var>adjustments in accordance with section 1(f) of the Internal Revenue Code except that for <br/>
<a id="pl.152.1"></a><var>152.1</var>the purposes of this subdivision the percentage increase must be determined from the year <br/>
<a id="pl.152.2"></a><var>152.2</var>starting September 1, 1999, and ending August 31, 2000, as the base year for adjusting <br/>
<a id="pl.152.3"></a><var>152.3</var>for inflation for the tax year beginning after December 31, 2000. The determination of <br/>
<a id="pl.152.4"></a><var>152.4</var>the commissioner under this subdivision is not a rule under the Administrative Procedure <br/>
<a id="pl.152.5"></a><var>152.5</var>Act. by the percentage determined pursuant to the provisions of section 1(f) of the Internal <br/>
<a id="pl.152.6"></a><var>152.6</var>Revenue Code, except that in section 1(f)(3)(B) the word "1999" shall be substituted for <br/>
<a id="pl.152.7"></a><var>152.7</var>the word "1992." For 2001, the commissioner shall then determine the percent change <br/>
<a id="pl.152.8"></a><var>152.8</var>from the 12 months ending on August 31, 1999, to the 12 months ending on August 31, <br/>
<a id="pl.152.9"></a><var>152.9</var>2000, and in each subsequent year, from the 12 months ending on August 31, 1999, to the <br/>
<a id="pl.152.10"></a><var>152.10</var>12 months ending on August 31 of the year preceding the taxable year. The determination <br/>
<a id="pl.152.11"></a><var>152.11</var>of the commissioner pursuant to this subdivision must not be considered a "rule" and is <br/>
<a id="pl.152.12"></a><var>152.12</var>not subject to the Administrative Procedure Act contained in chapter 14. The threshold <br/>
<a id="pl.152.13"></a><var>152.13</var>amount as adjusted must be rounded to the nearest $10 amount. If the amount ends in <br/>
<a id="pl.152.14"></a><var>152.14</var>$5, the amount is rounded up to the nearest $10 amount.<br/>
<a id="pl.152.15"></a><var>152.15</var><b>EFFECTIVE DATE.</b>This section is effective for taxable years beginning after <br/>
<a id="pl.152.16"></a><var>152.16</var>December 31, 2007.<br/>
<br/>
<a id="bill.11.15.0"></a><a id="pl.152.17"></a><var>152.17</var>    Sec. 15. Minnesota Statutes 2006, section 290.0671, subdivision 7, is amended to read:<br/>
<a id="pl.152.18"></a><var>152.18</var>    Subd. 7. <b>Inflation adjustment.</b> The earned income amounts used to calculate the <br/>
<a id="pl.152.19"></a><var>152.19</var>credit and the income thresholds at which the maximum credit begins to be reduced in <br/>
<a id="pl.152.20"></a><var>152.20</var>subdivision 1 must be adjusted for inflation. The commissioner shall make the inflation <br/>
<a id="pl.152.21"></a><var>152.21</var>adjustments in accordance with section 1(f) of the Internal Revenue Code except that for <br/>
<a id="pl.152.22"></a><var>152.22</var>the purposes of this subdivision the percentage increase shall be determined from the year <br/>
<a id="pl.152.23"></a><var>152.23</var>starting September 1, 1999, and ending August 31, 2000, as the base year for adjusting for <br/>
<a id="pl.152.24"></a><var>152.24</var>inflation for the tax year beginning after December 31, 2000. adjust by the percentage <br/>
<a id="pl.152.25"></a><var>152.25</var>determined pursuant to the provisions of section 1(f) of the Internal Revenue Code, except <br/>
<a id="pl.152.26"></a><var>152.26</var>that in section 1(f)(3)(B) the word "1999" shall be substituted for the word "1992." For <br/>
<a id="pl.152.27"></a><var>152.27</var>2001, the commissioner shall then determine the percent change from the 12 months <br/>
<a id="pl.152.28"></a><var>152.28</var>ending on August 31, 1999, to the 12 months ending on August 31, 2000, and in each <br/>
<a id="pl.152.29"></a><var>152.29</var>subsequent year, from the 12 months ending on August 31, 1999, to the 12 months ending <br/>
<a id="pl.152.30"></a><var>152.30</var>on August 31 of the year preceding the taxable year. The earned income thresholds as <br/>
<a id="pl.152.31"></a><var>152.31</var>adjusted for inflation must be rounded to the nearest $10 amount. If the amount ends <br/>
<a id="pl.152.32"></a><var>152.32</var>in $5, the amount is rounded up to the nearest $10 amount. The determination of the <br/>
<a id="pl.152.33"></a><var>152.33</var>commissioner under this subdivision is not a rule under the Administrative Procedure Act.<br/>
<a id="pl.153.1"></a><var>153.1</var><b>EFFECTIVE DATE.</b>This section is effective for taxable years beginning after <br/>
<a id="pl.153.2"></a><var>153.2</var>December 31, 2007.<br/>
<br/>
<a id="bill.11.16.0"></a><a id="pl.153.3"></a><var>153.3</var>    Sec. 16. Minnesota Statutes 2006, section 290.091, subdivision 3, is amended to read:<br/>
<a id="pl.153.4"></a><var>153.4</var>    Subd. 3. <b>Exemption amount.</b> (a) For purposes of computing the alternative <br/>
<a id="pl.153.5"></a><var>153.5</var>minimum tax, the exemption amount is:<br/>
<a id="pl.153.6"></a><var>153.6</var>    (1) for taxable years beginning before January 1, 2006, the exemption determined <br/>
<a id="pl.153.7"></a><var>153.7</var>under section 55(d) of the Internal Revenue Code, as amended through December 31, <br/>
<a id="pl.153.8"></a><var>153.8</var>1992; and<br/>
<a id="pl.153.9"></a><var>153.9</var>    (2), for taxable years beginning after December 31, 2005, $60,000 for married <br/>
<a id="pl.153.10"></a><var>153.10</var>couples filing joint returns, $30,000 for married individuals filing separate returns, estates, <br/>
<a id="pl.153.11"></a><var>153.11</var>and trusts, and $45,000 for unmarried individuals.<br/>
<a id="pl.153.12"></a><var>153.12</var>    (b) The exemption amount determined under this subdivision is subject to the phase <br/>
<a id="pl.153.13"></a><var>153.13</var>out under section 55(d)(3) of the Internal Revenue Code, except that alternative minimum <br/>
<a id="pl.153.14"></a><var>153.14</var>taxable income as determined under this section must be substituted in the computation of <br/>
<a id="pl.153.15"></a><var>153.15</var>the phase out.<br/>
<a id="pl.153.16"></a><var>153.16</var>    (c) For taxable years beginning after December 31, 2006, the exemption amount <br/>
<a id="pl.153.17"></a><var>153.17</var>under paragraph (a), clause (2), must be adjusted for inflation. The commissioner shall <br/>
<a id="pl.153.18"></a><var>153.18</var>make the inflation adjustments in accordance with section 1(f) of the Internal Revenue <br/>
<a id="pl.153.19"></a><var>153.19</var>Code except that for the purposes of this subdivision the percentage increase must be <br/>
<a id="pl.153.20"></a><var>153.20</var>determined from the year starting September 1, 2005, and ending August 31, 2006, as the <br/>
<a id="pl.153.21"></a><var>153.21</var>base year for adjusting for inflation for the tax year beginning after December 31, 2006. <br/>
<a id="pl.153.22"></a><var>153.22</var>The commissioner shall adjust the exemption amount by the percentage determined <br/>
<a id="pl.153.23"></a><var>153.23</var>pursuant to the provisions of section 1(f) of the Internal Revenue Code, except that in <br/>
<a id="pl.153.24"></a><var>153.24</var>section 1(f)(3)(B) the word "2005" shall be substituted for the word "1992." For 2007, <br/>
<a id="pl.153.25"></a><var>153.25</var>the commissioner shall then determine the percent change from the 12 months ending on <br/>
<a id="pl.153.26"></a><var>153.26</var>August 31, 2005, to the 12 months ending on August 31, 2006, and in each subsequent <br/>
<a id="pl.153.27"></a><var>153.27</var>year, from the 12 months ending on August 31, 2005, to the 12 months ending on August <br/>
<a id="pl.153.28"></a><var>153.28</var>31 of the year preceding the taxable year. The exemption amount as adjusted must be <br/>
<a id="pl.153.29"></a><var>153.29</var>rounded to the nearest $10. If the amount ends in $5, it must be rounded up to the nearest <br/>
<a id="pl.153.30"></a><var>153.30</var>$10 amount. The determination of the commissioner under this subdivision is not a rule <br/>
<a id="pl.153.31"></a><var>153.31</var>under the Administrative Procedure Act.<br/>
<a id="pl.153.32"></a><var>153.32</var><b>EFFECTIVE DATE.</b>This section is effective for taxable years beginning after <br/>
<a id="pl.153.33"></a><var>153.33</var>December 31, 2007.<br/>
<br/>
<a id="bill.11.17.0"></a><a id="pl.153.34"></a><var>153.34</var>    Sec. 17. Minnesota Statutes 2006, section 290.0921, subdivision 3, is amended to read:<br/>
<a id="pl.154.1"></a><var>154.1</var>    Subd. 3. <b>Alternative minimum taxable income.</b> "Alternative minimum taxable <br/>
<a id="pl.154.2"></a><var>154.2</var>income" is Minnesota net income as defined in section 
         <statute_ref>290.01, subdivision 19</statute_ref>, and <br/>
<a id="pl.154.3"></a><var>154.3</var>includes the adjustments and tax preference items in sections 56, 57, 58, and 59(d), (e), <br/>
<a id="pl.154.4"></a><var>154.4</var>(f), and (h) of the Internal Revenue Code. If a corporation files a separate company <br/>
<a id="pl.154.5"></a><var>154.5</var>Minnesota tax return, the minimum tax must be computed on a separate company basis. <br/>
<a id="pl.154.6"></a><var>154.6</var>If a corporation is part of a tax group filing a unitary return, the minimum tax must be <br/>
<a id="pl.154.7"></a><var>154.7</var>computed on a unitary basis. The following adjustments must be made.<br/>
<a id="pl.154.8"></a><var>154.8</var>(1) For purposes of the depreciation adjustments under section 56(a)(1) and <br/>
<a id="pl.154.9"></a><var>154.9</var>56(g)(4)(A) of the Internal Revenue Code, the basis for depreciable property placed in <br/>
<a id="pl.154.10"></a><var>154.10</var>service in a taxable year beginning before January 1, 1990, is the adjusted basis for federal <br/>
<a id="pl.154.11"></a><var>154.11</var>income tax purposes, including any modification made in a taxable year under section <br/>
<statute_ref><a id="pl.154.12"></a><var>154.12</var>290.01, subdivision 19e
         </statute_ref>, or Minnesota Statutes 1986, section 
         <statute_ref>290.09, subdivision 7</statute_ref>, <br/>
<a id="pl.154.13"></a><var>154.13</var>paragraph (c).<br/>
<a id="pl.154.14"></a><var>154.14</var>For taxable years beginning after December 31, 2000, the amount of any remaining <br/>
<a id="pl.154.15"></a><var>154.15</var>modification made under section 
         <statute_ref>290.01, subdivision 19e</statute_ref>, or Minnesota Statutes 1986, <br/>
<a id="pl.154.16"></a><var>154.16</var>section 
         <statute_ref>290.09, subdivision 7</statute_ref>, paragraph (c), not previously deducted is a depreciation <br/>
<a id="pl.154.17"></a><var>154.17</var>allowance in the first taxable year after December 31, 2000.<br/>
<a id="pl.154.18"></a><var>154.18</var>(2) The portion of the depreciation deduction allowed for federal income tax <br/>
<a id="pl.154.19"></a><var>154.19</var>purposes under section 168(k) of the Internal Revenue Code that is required as an addition <br/>
<a id="pl.154.20"></a><var>154.20</var>under section 
         <statute_ref>290.01, subdivision 19c</statute_ref>, clause (16) (15), is disallowed in determining <br/>
<a id="pl.154.21"></a><var>154.21</var>alternative minimum taxable income.<br/>
<a id="pl.154.22"></a><var>154.22</var>(3) The subtraction for depreciation allowed under section 
         <statute_ref>290.01, subdivision <br/>
<a id="pl.154.23"></a><var>154.23</var>19d
         </statute_ref>, clause (19) (18), is allowed as a depreciation deduction in determining alternative <br/>
<a id="pl.154.24"></a><var>154.24</var>minimum taxable income.<br/>
<a id="pl.154.25"></a><var>154.25</var>(4) The alternative tax net operating loss deduction under sections 56(a)(4) and 56(d) <br/>
<a id="pl.154.26"></a><var>154.26</var>of the Internal Revenue Code does not apply.<br/>
<a id="pl.154.27"></a><var>154.27</var>(5) The special rule for certain dividends under section 56(g)(4)(C)(ii) of the Internal <br/>
<a id="pl.154.28"></a><var>154.28</var>Revenue Code does not apply.<br/>
<a id="pl.154.29"></a><var>154.29</var>(6) The special rule for dividends from section 936 companies under section <br/>
<a id="pl.154.30"></a><var>154.30</var>56(g)(4)(C)(iii) does not apply.<br/>
<a id="pl.154.31"></a><var>154.31</var>(7) The tax preference for depletion under section 57(a)(1) of the Internal Revenue <br/>
<a id="pl.154.32"></a><var>154.32</var>Code does not apply.<br/>
<a id="pl.154.33"></a><var>154.33</var>(8) The tax preference for intangible drilling costs under section 57(a)(2) of the <br/>
<a id="pl.154.34"></a><var>154.34</var>Internal Revenue Code must be calculated without regard to subparagraph (E) and the <br/>
<a id="pl.154.35"></a><var>154.35</var>subtraction under section 
         <statute_ref>290.01, subdivision 19d</statute_ref>, clause (4).<br/>
<a id="pl.155.1"></a><var>155.1</var>(9) The tax preference for tax exempt interest under section 57(a)(5) of the Internal <br/>
<a id="pl.155.2"></a><var>155.2</var>Revenue Code does not apply.<br/>
<a id="pl.155.3"></a><var>155.3</var>(10) The tax preference for charitable contributions of appreciated property under <br/>
<a id="pl.155.4"></a><var>155.4</var>section 57(a)(6) of the Internal Revenue Code does not apply.<br/>
<a id="pl.155.5"></a><var>155.5</var>(11) For purposes of calculating the tax preference for accelerated depreciation or <br/>
<a id="pl.155.6"></a><var>155.6</var>amortization on certain property placed in service before January 1, 1987, under section <br/>
<a id="pl.155.7"></a><var>155.7</var>57(a)(7) of the Internal Revenue Code, the deduction allowable for the taxable year is the <br/>
<a id="pl.155.8"></a><var>155.8</var>deduction allowed under section 
         <statute_ref>290.01, subdivision 19e</statute_ref>.<br/>
<a id="pl.155.9"></a><var>155.9</var>For taxable years beginning after December 31, 2000, the amount of any remaining <br/>
<a id="pl.155.10"></a><var>155.10</var>modification made under section 
         <statute_ref>290.01, subdivision 19e</statute_ref>, not previously deducted is a <br/>
<a id="pl.155.11"></a><var>155.11</var>depreciation or amortization allowance in the first taxable year after December 31, 2004.<br/>
<a id="pl.155.12"></a><var>155.12</var>(12) For purposes of calculating the adjustment for adjusted current earnings in <br/>
<a id="pl.155.13"></a><var>155.13</var>section 56(g) of the Internal Revenue Code, the term "alternative minimum taxable <br/>
<a id="pl.155.14"></a><var>155.14</var>income" as it is used in section 56(g) of the Internal Revenue Code, means alternative <br/>
<a id="pl.155.15"></a><var>155.15</var>minimum taxable income as defined in this subdivision, determined without regard to the <br/>
<a id="pl.155.16"></a><var>155.16</var>adjustment for adjusted current earnings in section 56(g) of the Internal Revenue Code.<br/>
<a id="pl.155.17"></a><var>155.17</var>(13) For purposes of determining the amount of adjusted current earnings under <br/>
<a id="pl.155.18"></a><var>155.18</var>section 56(g)(3) of the Internal Revenue Code, no adjustment shall be made under section <br/>
<a id="pl.155.19"></a><var>155.19</var>56(g)(4) of the Internal Revenue Code with respect to (i) the amount of foreign dividend <br/>
<a id="pl.155.20"></a><var>155.20</var>gross-up subtracted as provided in section 
         <statute_ref>290.01, subdivision 19d</statute_ref>, clause (1), (ii) the <br/>
<a id="pl.155.21"></a><var>155.21</var>amount of refunds of income, excise, or franchise taxes subtracted as provided in section <br/>
<statute_ref><a id="pl.155.22"></a><var>155.22</var>290.01, subdivision 19d
         </statute_ref>, clause (10) (9), or (iii) the amount of royalties, fees or other like <br/>
<a id="pl.155.23"></a><var>155.23</var>income subtracted as provided in section 
         <statute_ref>290.01, subdivision 19d</statute_ref>, clause (11) (10).<br/>
<a id="pl.155.24"></a><var>155.24</var>(14) Alternative minimum taxable income excludes the income from operating in a <br/>
<a id="pl.155.25"></a><var>155.25</var>job opportunity building zone as provided under section 
         <statute_ref>469.317</statute_ref>.<br/>
<a id="pl.155.26"></a><var>155.26</var>(15) Alternative minimum taxable income excludes the income from operating in a <br/>
<a id="pl.155.27"></a><var>155.27</var>biotechnology and health sciences industry zone as provided under section 
         <statute_ref>469.337</statute_ref>.<br/>
<a id="pl.155.28"></a><var>155.28</var>(16) Alternative minimum taxable income excludes the income from operating in an <br/>
<a id="pl.155.29"></a><var>155.29</var>international economic development zone as provided under section 
         <statute_ref>469.326</statute_ref>.<br/>
<a id="pl.155.30"></a><var>155.30</var>Items of tax preference must not be reduced below zero as a result of the <br/>
<a id="pl.155.31"></a><var>155.31</var>modifications in this subdivision.<br/>
<a id="pl.155.32"></a><var>155.32</var><b>EFFECTIVE DATE.</b>This section is effective for taxable years beginning after <br/>
<a id="pl.155.33"></a><var>155.33</var>December 31, 2007.<br/>
<br/>
<a id="bill.11.18.0"></a><a id="pl.155.34"></a><var>155.34</var>    Sec. 18. Minnesota Statutes 2006, section 290.191, subdivision 8, is amended to read:<br/>
<a id="pl.156.1"></a><var>156.1</var>    Subd. 8. <b>Deposit; definition.</b> (a) "Deposit," as used in subdivision 7 6, paragraph <br/>
<a id="pl.156.2"></a><var>156.2</var>(n), has the meanings in this subdivision.<br/>
<a id="pl.156.3"></a><var>156.3</var>    (b) "Deposit" means the unpaid balance of money or its equivalent received or <br/>
<a id="pl.156.4"></a><var>156.4</var>held by a financial institution in the usual course of business and for which it has given <br/>
<a id="pl.156.5"></a><var>156.5</var>or is obligated to give credit, either conditionally or unconditionally, to a commercial, <br/>
<a id="pl.156.6"></a><var>156.6</var>checking, savings, time, or thrift account whether or not advance notice is required to <br/>
<a id="pl.156.7"></a><var>156.7</var>withdraw the credited funds, or which is evidenced by its certificate of deposit, thrift <br/>
<a id="pl.156.8"></a><var>156.8</var>certificate, investment certificate, or certificate of indebtedness, or other similar name, or a <br/>
<a id="pl.156.9"></a><var>156.9</var>check or draft drawn against a deposit account and certified by the financial institution, <br/>
<a id="pl.156.10"></a><var>156.10</var>or a letter of credit or a traveler's check on which the financial institution is primarily <br/>
<a id="pl.156.11"></a><var>156.11</var>liable. However, without limiting the generality of the term "money or its equivalent," any <br/>
<a id="pl.156.12"></a><var>156.12</var>such account or instrument must be regarded as evidencing the receipt of the equivalent <br/>
<a id="pl.156.13"></a><var>156.13</var>of money when credited or issued in exchange for checks or drafts or for a promissory <br/>
<a id="pl.156.14"></a><var>156.14</var>note upon which the person obtaining the credit or instrument is primarily or secondarily <br/>
<a id="pl.156.15"></a><var>156.15</var>liable, or for a charge against a deposit account, or in settlement of checks, drafts, or other <br/>
<a id="pl.156.16"></a><var>156.16</var>instruments forwarded to the bank for collection.<br/>
<a id="pl.156.17"></a><var>156.17</var>    (c) "Deposit" means trust funds received or held by the financial institution, whether <br/>
<a id="pl.156.18"></a><var>156.18</var>held in the trust department or held or deposited in any other department of the financial <br/>
<a id="pl.156.19"></a><var>156.19</var>institution.<br/>
<a id="pl.156.20"></a><var>156.20</var>    (d) "Deposit" means money received or held by a financial institution, or the credit <br/>
<a id="pl.156.21"></a><var>156.21</var>given for money or its equivalent received or held by a financial institution, in the usual <br/>
<a id="pl.156.22"></a><var>156.22</var>course of business for a special or specific purpose, regardless of the legal relationship so <br/>
<a id="pl.156.23"></a><var>156.23</var>established. Under this paragraph, "deposit" includes, but is not limited to, escrow funds, <br/>
<a id="pl.156.24"></a><var>156.24</var>funds held as security for an obligation due to the financial institution or others, including <br/>
<a id="pl.156.25"></a><var>156.25</var>funds held as dealers reserves, or for securities loaned by the financial institution, funds <br/>
<a id="pl.156.26"></a><var>156.26</var>deposited by a debtor to meet maturing obligations, funds deposited as advance payment <br/>
<a id="pl.156.27"></a><var>156.27</var>on subscriptions to United States government securities, funds held for distribution or <br/>
<a id="pl.156.28"></a><var>156.28</var>purchase of securities, funds held to meet its acceptances or letters of credit, and withheld <br/>
<a id="pl.156.29"></a><var>156.29</var>taxes. It does not include funds received by the financial institution for immediate <br/>
<a id="pl.156.30"></a><var>156.30</var>application to the reduction of an indebtedness to the receiving financial institution, or <br/>
<a id="pl.156.31"></a><var>156.31</var>under condition that the receipt of the funds immediately reduces or extinguishes the <br/>
<a id="pl.156.32"></a><var>156.32</var>indebtedness.<br/>
<a id="pl.156.33"></a><var>156.33</var>    (e) "Deposit" means outstanding drafts, including advice or another such institution, <br/>
<a id="pl.156.34"></a><var>156.34</var>cashier's checks, money orders, or other officer's checks issued in the usual course <br/>
<a id="pl.156.35"></a><var>156.35</var>of business for any purpose, but not including those issued in payment for services, <br/>
<a id="pl.156.36"></a><var>156.36</var>dividends, or purchases or other costs or expenses of the financial institution itself.<br/>
<a id="pl.157.1"></a><var>157.1</var>    (f) "Deposit" means money or its equivalent held as a credit balance by a financial <br/>
<a id="pl.157.2"></a><var>157.2</var>institution on behalf of its customer if the entity is engaged in soliciting and holding such <br/>
<a id="pl.157.3"></a><var>157.3</var>balances in the regular course of its business.<br/>
<a id="pl.157.4"></a><var>157.4</var>    (g) Interinstitution fund transfers are not deposits.<br/>
<a id="pl.157.5"></a><var>157.5</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.11.19.0"></a><a id="pl.157.6"></a><var>157.6</var>    Sec. 19. Minnesota Statutes 2006, section 290A.03, subdivision 7, is amended to read:<br/>
<a id="pl.157.7"></a><var>157.7</var>    Subd. 7. <b>Dependent.</b> "Dependent" means any person who is considered a <br/>
<a id="pl.157.8"></a><var>157.8</var>dependent under sections 151 and 152 of the Internal Revenue Code. In the case of a son, <br/>
<a id="pl.157.9"></a><var>157.9</var>stepson, daughter, or stepdaughter of the claimant, amounts received as a Minnesota <br/>
<a id="pl.157.10"></a><var>157.10</var>family investment program grant, allowance to or on behalf of the child, surplus food, or <br/>
<a id="pl.157.11"></a><var>157.11</var>other relief in kind supplied by a governmental agency must not be taken into account <br/>
<a id="pl.157.12"></a><var>157.12</var>in determining whether the child received more than half of the child's support from <br/>
<a id="pl.157.13"></a><var>157.13</var>the claimant.<br/>
<a id="pl.157.14"></a><var>157.14</var><b>EFFECTIVE DATE.</b>This section is effective for property tax refunds based on <br/>
<a id="pl.157.15"></a><var>157.15</var>rents paid after December 31, 2007, and property taxes payable after December 31, 2008.<br/>
<br/>
<a id="bill.12.0.0"></a>

<a id="bill.12.1.0"></a><a id="pl.157.18"></a><var>157.18</var>    Section 1. Minnesota Statutes 2006, section 289A.40, subdivision 2, is amended to <br/>
<a id="pl.157.19"></a><var>157.19</var>read:<br/>
<a id="pl.157.20"></a><var>157.20</var>    Subd. 2. <b>Bad debt loss.</b> If a claim relates to an overpayment because of a failure to <br/>
<a id="pl.157.21"></a><var>157.21</var>deduct a loss due to a bad debt or to a security becoming worthless, the claim is considered <br/>
<a id="pl.157.22"></a><var>157.22</var>timely if filed within seven years from the date prescribed for the filing of the return. A <br/>
<a id="pl.157.23"></a><var>157.23</var>claim relating to an overpayment of taxes under chapter 297A must be filed within 3-1/2 <br/>
<a id="pl.157.24"></a><var>157.24</var>years from the date prescribed for filing the return, plus any extensions granted for filing <br/>
<a id="pl.157.25"></a><var>157.25</var>the return, but only if filed within the extended time when the bad debt was (1) written off <br/>
<a id="pl.157.26"></a><var>157.26</var>as uncollectible in the taxpayer's books and records, and (2) either eligible to be deducted <br/>
<a id="pl.157.27"></a><var>157.27</var>for federal income tax purposes or would have been eligible for a bad debt deduction for <br/>
<a id="pl.157.28"></a><var>157.28</var>federal income tax purposes if the taxpayer were required to file a federal income tax <br/>
<a id="pl.157.29"></a><var>157.29</var>return, or within one year from the date the taxpayer's federal income tax return is timely <br/>
<a id="pl.157.30"></a><var>157.30</var>filed claiming the bad debt deduction, whichever period is later. The refund or credit is <br/>
<a id="pl.157.31"></a><var>157.31</var>limited to the amount of overpayment attributable to the loss. "Bad debt" for purposes <br/>
<a id="pl.157.32"></a><var>157.32</var>of this subdivision, has the same meaning as that term is used in United States Code, <br/>
<a id="pl.157.33"></a><var>157.33</var>title 26, section 166, except that for a claim relating to an overpayment of taxes under <br/>
<a id="pl.158.1"></a><var>158.1</var>chapter 297A the following are excluded from the calculation of bad debt: financing <br/>
<a id="pl.158.2"></a><var>158.2</var>charges or interest; sales or use taxes charged on the purchase price; uncollectible amounts <br/>
<a id="pl.158.3"></a><var>158.3</var>on property that remain in the possession of the seller until the full purchase price is <br/>
<a id="pl.158.4"></a><var>158.4</var>paid; expenses incurred in attempting to collect any debt; and repossessed property. For <br/>
<a id="pl.158.5"></a><var>158.5</var>purposes of reporting a payment received on previously claimed bad debt under chapter <br/>
<a id="pl.158.6"></a><var>158.6</var>297A, any payments made on a debt or account are applied first proportionally to the <br/>
<a id="pl.158.7"></a><var>158.7</var>taxable price of the property or service and the sales tax on it, and secondly to interest, <br/>
<a id="pl.158.8"></a><var>158.8</var>service charges, and any other charges.<br/>
<a id="pl.158.9"></a><var>158.9</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.12.2.0"></a><a id="pl.158.10"></a><var>158.10</var>    Sec. 2. Minnesota Statutes 2006, section 289A.56, is amended by adding a subdivision <br/>
<a id="pl.158.11"></a><var>158.11</var>to read:<br/>
<a id="pl.158.12"></a><var>158.12</var>    Subd. 8. <b>Border city zone refunds.</b> Notwithstanding subdivision 3, for refunds <br/>
<a id="pl.158.13"></a><var>158.13</var>payable under section 469.1734, subdivision 6, interest is computed from 90 days after the <br/>
<a id="pl.158.14"></a><var>158.14</var>refund claim is filed with the commissioner.<br/>
<a id="pl.158.15"></a><var>158.15</var><b>EFFECTIVE DATE.</b>This section is effective for refund claims filed after June <br/>
<a id="pl.158.16"></a><var>158.16</var>30, 2008.<br/>
<br/>
<a id="bill.12.3.0"></a><a id="pl.158.17"></a><var>158.17</var>    Sec. 3. Minnesota Statutes 2006, section 289A.60, subdivision 25, is amended to read:<br/>
<a id="pl.158.18"></a><var>158.18</var>    Subd. 25. <b>Penalty for failure to properly complete sales </b><b>and use </b><b>tax return.</b> A <br/>
<a id="pl.158.19"></a><var>158.19</var>person who fails to report local sales tax taxes required to be reported on a sales and use <br/>
<a id="pl.158.20"></a><var>158.20</var>tax return or who fails to report local sales tax taxes on separate tax lines on the sales <br/>
<a id="pl.158.21"></a><var>158.21</var>and use tax return is subject to a penalty of five percent of the amount of tax not properly <br/>
<a id="pl.158.22"></a><var>158.22</var>reported on the return. A person who files a consolidated tax return but fails to report <br/>
<a id="pl.158.23"></a><var>158.23</var>location information is subject to a $500 penalty for each return not containing location <br/>
<a id="pl.158.24"></a><var>158.24</var>information. In addition, the commissioner may revoke the privilege for a taxpayer to <br/>
<a id="pl.158.25"></a><var>158.25</var>file consolidated returns and may require the taxpayer to separately register each location <br/>
<a id="pl.158.26"></a><var>158.26</var>and to file a tax return for each location.<br/>
<a id="pl.158.27"></a><var>158.27</var><b>EFFECTIVE DATE.</b>This section is effective for returns filed after June 30, 2008.<br/>
<br/>
<a id="bill.12.4.0"></a><a id="pl.158.28"></a><var>158.28</var>    Sec. 4. Minnesota Statutes 2006, section 289A.60, is amended by adding a subdivision <br/>
<a id="pl.158.29"></a><var>158.29</var>to read:<br/>
<a id="pl.158.30"></a><var>158.30</var>    Subd. 29. <b>Penalty for failure to report liquor sales.</b> In the case of a failure to file <br/>
<a id="pl.158.31"></a><var>158.31</var>an informational report required by section 297A.8155 with the commissioner on or before <br/>
<a id="pl.159.1"></a><var>159.1</var>the date prescribed, the person failing to file the report shall pay a penalty of $500 each <br/>
<a id="pl.159.2"></a><var>159.2</var>failure. If a failure to file a report is intentional, the penalty shall be $1,000 each failure.<br/>
<a id="pl.159.3"></a><var>159.3</var><b>EFFECTIVE DATE.</b>This section is effective for reports filed after December <br/>
<a id="pl.159.4"></a><var>159.4</var>31, 2008.<br/>
<br/>
<a id="bill.12.5.0"></a><a id="pl.159.5"></a><var>159.5</var>    Sec. 5. Minnesota Statutes 2006, section 297A.61, subdivision 3, is amended to read:<br/>
<a id="pl.159.6"></a><var>159.6</var>    Subd. 3. <b>Sale and purchase.</b> (a) "Sale" and "purchase" include, but are not limited <br/>
<a id="pl.159.7"></a><var>159.7</var>to, each of the transactions listed in this subdivision.<br/>
<a id="pl.159.8"></a><var>159.8</var>    (b) Sale and purchase include:<br/>
<a id="pl.159.9"></a><var>159.9</var>    (1) any transfer of title or possession, or both, of tangible personal property, whether <br/>
<a id="pl.159.10"></a><var>159.10</var>absolutely or conditionally, for a consideration in money or by exchange or barter; and<br/>
<a id="pl.159.11"></a><var>159.11</var>    (2) the leasing of or the granting of a license to use or consume, for a consideration <br/>
<a id="pl.159.12"></a><var>159.12</var>in money or by exchange or barter, tangible personal property, other than a manufactured <br/>
<a id="pl.159.13"></a><var>159.13</var>home used for residential purposes for a continuous period of 30 days or more.<br/>
<a id="pl.159.14"></a><var>159.14</var>    (c) Sale and purchase include the production, fabrication, printing, or processing of <br/>
<a id="pl.159.15"></a><var>159.15</var>tangible personal property for a consideration for consumers who furnish either directly or <br/>
<a id="pl.159.16"></a><var>159.16</var>indirectly the materials used in the production, fabrication, printing, or processing.<br/>
<a id="pl.159.17"></a><var>159.17</var>    (d) Sale and purchase include the preparing for a consideration of food. <br/>
<a id="pl.159.18"></a><var>159.18</var>Notwithstanding section 
         <statute_ref>297A.67, subdivision 2</statute_ref>, taxable food includes, but is not limited <br/>
<a id="pl.159.19"></a><var>159.19</var>to, the following:<br/>
<a id="pl.159.20"></a><var>159.20</var>    (1) prepared food sold by the retailer;<br/>
<a id="pl.159.21"></a><var>159.21</var>    (2) soft drinks;<br/>
<a id="pl.159.22"></a><var>159.22</var>    (3) candy;<br/>
<a id="pl.159.23"></a><var>159.23</var>    (4) dietary supplements; and<br/>
<a id="pl.159.24"></a><var>159.24</var>    (5) all food sold through vending machines.<br/>
<a id="pl.159.25"></a><var>159.25</var>    (e) A sale and a purchase includes the furnishing for a consideration of electricity, <br/>
<a id="pl.159.26"></a><var>159.26</var>gas, water, or steam for use or consumption within this state.<br/>
<a id="pl.159.27"></a><var>159.27</var>    (f) A sale and a purchase includes the transfer for a consideration of prewritten <br/>
<a id="pl.159.28"></a><var>159.28</var>computer software whether delivered electronically, by load and leave, or otherwise.<br/>
<a id="pl.159.29"></a><var>159.29</var>    (g) A sale and a purchase includes the furnishing for a consideration of the following <br/>
<a id="pl.159.30"></a><var>159.30</var>services:<br/>
<a id="pl.159.31"></a><var>159.31</var>    (1) the privilege of admission to places of amusement, recreational areas, or athletic <br/>
<a id="pl.159.32"></a><var>159.32</var>events, and the making available of amusement devices, tanning facilities, reducing <br/>
<a id="pl.159.33"></a><var>159.33</var>salons, steam baths, turkish baths, health clubs, and spas or athletic facilities;<br/>
<a id="pl.159.34"></a><var>159.34</var>    (2) lodging and related services by a hotel, rooming house, resort, campground, <br/>
<a id="pl.159.35"></a><var>159.35</var>motel, or trailer camp, including furnishing the guest of the facility with access to <br/>
<a id="pl.160.1"></a><var>160.1</var>telecommunication services, and the granting of any similar license to use real property <br/>
<a id="pl.160.2"></a><var>160.2</var>in a specific facility, other than the renting or leasing of it for a continuous period of <br/>
<a id="pl.160.3"></a><var>160.3</var>30 days or more under an enforceable written agreement that may not be terminated <br/>
<a id="pl.160.4"></a><var>160.4</var>without prior notice;<br/>
<a id="pl.160.5"></a><var>160.5</var>    (3) nonresidential parking services, whether on a contractual, hourly, or other <br/>
<a id="pl.160.6"></a><var>160.6</var>periodic basis, except for parking at a meter;<br/>
<a id="pl.160.7"></a><var>160.7</var>    (4) the granting of membership in a club, association, or other organization if:<br/>
<a id="pl.160.8"></a><var>160.8</var>    (i) the club, association, or other organization makes available for the use of its <br/>
<a id="pl.160.9"></a><var>160.9</var>members sports and athletic facilities, without regard to whether a separate charge is <br/>
<a id="pl.160.10"></a><var>160.10</var>assessed for use of the facilities; and<br/>
<a id="pl.160.11"></a><var>160.11</var>    (ii) use of the sports and athletic facility is not made available to the general public <br/>
<a id="pl.160.12"></a><var>160.12</var>on the same basis as it is made available to members.<br/>
<a id="pl.160.13"></a><var>160.13</var>Granting of membership means both onetime initiation fees and periodic membership <br/>
<a id="pl.160.14"></a><var>160.14</var>dues. Sports and athletic facilities include golf courses; tennis, racquetball, handball, and <br/>
<a id="pl.160.15"></a><var>160.15</var>squash courts; basketball and volleyball facilities; running tracks; exercise equipment; <br/>
<a id="pl.160.16"></a><var>160.16</var>swimming pools; and other similar athletic or sports facilities;<br/>
<a id="pl.160.17"></a><var>160.17</var>    (5) delivery of aggregate materials and concrete block by a third party, excluding <br/>
<a id="pl.160.18"></a><var>160.18</var>delivery of aggregate material used in road construction, and delivery of concrete block by <br/>
<a id="pl.160.19"></a><var>160.19</var>a third party if the delivery would be subject to the sales tax if provided by the seller of the <br/>
<a id="pl.160.20"></a><var>160.20</var>aggregate material or concrete block; and<br/>
<a id="pl.160.21"></a><var>160.21</var>    (6) services as provided in this clause:<br/>
<a id="pl.160.22"></a><var>160.22</var>    (i) laundry and dry cleaning services including cleaning, pressing, repairing, altering, <br/>
<a id="pl.160.23"></a><var>160.23</var>and storing clothes, linen services and supply, cleaning and blocking hats, and carpet, <br/>
<a id="pl.160.24"></a><var>160.24</var>drapery, upholstery, and industrial cleaning. Laundry and dry cleaning services do not <br/>
<a id="pl.160.25"></a><var>160.25</var>include services provided by coin operated facilities operated by the customer;<br/>
<a id="pl.160.26"></a><var>160.26</var>    (ii) motor vehicle washing, waxing, and cleaning services, including services <br/>
<a id="pl.160.27"></a><var>160.27</var>provided by coin operated facilities operated by the customer, and rustproofing, <br/>
<a id="pl.160.28"></a><var>160.28</var>undercoating, and towing of motor vehicles;<br/>
<a id="pl.160.29"></a><var>160.29</var>    (iii) building and residential cleaning, maintenance, and disinfecting services and <br/>
<a id="pl.160.30"></a><var>160.30</var>pest control and exterminating services;<br/>
<a id="pl.160.31"></a><var>160.31</var>    (iv) detective, security, burglar, fire alarm, and armored car services; but not <br/>
<a id="pl.160.32"></a><var>160.32</var>including services performed within the jurisdiction they serve by off-duty licensed peace <br/>
<a id="pl.160.33"></a><var>160.33</var>officers as defined in section 
         <statute_ref>626.84, subdivision 1</statute_ref>, or services provided by a nonprofit <br/>
<a id="pl.160.34"></a><var>160.34</var>organization for monitoring and electronic surveillance of persons placed on in-home <br/>
<a id="pl.160.35"></a><var>160.35</var>detention pursuant to court order or under the direction of the Minnesota Department <br/>
<a id="pl.160.36"></a><var>160.36</var>of Corrections;<br/>
<a id="pl.161.1"></a><var>161.1</var>    (v) pet grooming services;<br/>
<a id="pl.161.2"></a><var>161.2</var>    (vi) lawn care, fertilizing, mowing, spraying and sprigging services; garden planting <br/>
<a id="pl.161.3"></a><var>161.3</var>and maintenance; tree, bush, and shrub pruning, bracing, spraying, and surgery; indoor <br/>
<a id="pl.161.4"></a><var>161.4</var>plant care; tree, bush, shrub, and stump removal, except when performed as part of a land <br/>
<a id="pl.161.5"></a><var>161.5</var>clearing contract as defined in section 
         <statute_ref>297A.68, subdivision 40</statute_ref>; and tree trimming for <br/>
<a id="pl.161.6"></a><var>161.6</var>public utility lines. Services performed under a construction contract for the installation of <br/>
<a id="pl.161.7"></a><var>161.7</var>shrubbery, plants, sod, trees, bushes, and similar items are not taxable;<br/>
<a id="pl.161.8"></a><var>161.8</var>    (vii) massages, except when provided by a licensed health care facility or <br/>
<a id="pl.161.9"></a><var>161.9</var>professional or upon written referral from a licensed health care facility or professional for <br/>
<a id="pl.161.10"></a><var>161.10</var>treatment of illness, injury, or disease; and<br/>
<a id="pl.161.11"></a><var>161.11</var>    (viii) the furnishing of lodging, board, and care services for animals in kennels and <br/>
<a id="pl.161.12"></a><var>161.12</var>other similar arrangements, but excluding veterinary and horse boarding services.<br/>
<a id="pl.161.13"></a><var>161.13</var>    In applying the provisions of this chapter, the terms "tangible personal property" <br/>
<a id="pl.161.14"></a><var>161.14</var>and "retail sale" include taxable services listed in clause (6), items (i) to (vi) and (viii), <br/>
<a id="pl.161.15"></a><var>161.15</var>and the provision of these taxable services, unless specifically provided otherwise. <br/>
<a id="pl.161.16"></a><var>161.16</var>Services performed by an employee for an employer are not taxable. Services performed <br/>
<a id="pl.161.17"></a><var>161.17</var>by a partnership or association for another partnership or association are not taxable if <br/>
<a id="pl.161.18"></a><var>161.18</var>one of the entities owns or controls more than 80 percent of the voting power of the <br/>
<a id="pl.161.19"></a><var>161.19</var>equity interest in the other entity. Services performed between members of an affiliated <br/>
<a id="pl.161.20"></a><var>161.20</var>group of corporations are not taxable. For purposes of the preceding sentence, "affiliated <br/>
<a id="pl.161.21"></a><var>161.21</var>group of corporations" means those entities that would be classified as members of an <br/>
<a id="pl.161.22"></a><var>161.22</var>affiliated group as defined under United States Code, title 26, section 1504, disregarding <br/>
<a id="pl.161.23"></a><var>161.23</var>the exclusions in section 1504(b).<br/>
<a id="pl.161.24"></a><var>161.24</var>    For purposes of clause (5), "road construction" means construction of (1) public <br/>
<a id="pl.161.25"></a><var>161.25</var>roads, (2) cartways, and (3) private roads in townships located outside of the seven-county <br/>
<a id="pl.161.26"></a><var>161.26</var>metropolitan area up to the point of the emergency response location sign.<br/>
<a id="pl.161.27"></a><var>161.27</var>    (h) A sale and a purchase includes the furnishing for a consideration of tangible <br/>
<a id="pl.161.28"></a><var>161.28</var>personal property or taxable services by the United States or any of its agencies or <br/>
<a id="pl.161.29"></a><var>161.29</var>instrumentalities, or the state of Minnesota, its agencies, instrumentalities, or political <br/>
<a id="pl.161.30"></a><var>161.30</var>subdivisions.<br/>
<a id="pl.161.31"></a><var>161.31</var>    (i) A sale and a purchase includes the furnishing for a consideration <br/>
<a id="pl.161.32"></a><var>161.32</var>of telecommunications services, including ancillary services associated with <br/>
<a id="pl.161.33"></a><var>161.33</var>telecommunication services, cable television services and, direct satellite services, and <br/>
<a id="pl.161.34"></a><var>161.34</var>ring tones. Telecommunications Telecommunication services include, but are not limited <br/>
<a id="pl.161.35"></a><var>161.35</var>to, the following services, as defined in section 297A.669: air-to-ground radiotelephone <br/>
<a id="pl.161.36"></a><var>161.36</var>service, mobile telecommunication service, postpaid calling service, prepaid calling <br/>
<a id="pl.162.1"></a><var>162.1</var>service, prepaid wireless calling service, and private communication services. The <br/>
<a id="pl.162.2"></a><var>162.2</var>services in this paragraph are taxed to the extent allowed under federal law.<br/>
<a id="pl.162.3"></a><var>162.3</var>    (j) A sale and a purchase includes the furnishing for a consideration of installation if <br/>
<a id="pl.162.4"></a><var>162.4</var>the installation charges would be subject to the sales tax if the installation were provided <br/>
<a id="pl.162.5"></a><var>162.5</var>by the seller of the item being installed.<br/>
<a id="pl.162.6"></a><var>162.6</var>    (k) A sale and a purchase includes the rental of a vehicle by a motor vehicle dealer <br/>
<a id="pl.162.7"></a><var>162.7</var>to a customer when (1) the vehicle is rented by the customer for a consideration, or (2) <br/>
<a id="pl.162.8"></a><var>162.8</var>the motor vehicle dealer is reimbursed pursuant to a service contract as defined in section <br/>
<statute_ref><a id="pl.162.9"></a><var>162.9</var>65B.29, subdivision 1
         </statute_ref>, clause (1).<br/>
<a id="pl.162.10"></a><var>162.10</var><b>EFFECTIVE DATE.</b>This section is effective for sales and purchases made after <br/>
<a id="pl.162.11"></a><var>162.11</var>June 30, 2008, except that the amendments to paragraphs (g), clause (2), and (i), are <br/>
<a id="pl.162.12"></a><var>162.12</var>effective retroactively for sales and purchases made after December 31, 2007.<br/>
<br/>
<a id="bill.12.6.0"></a><a id="pl.162.13"></a><var>162.13</var>    Sec. 6. Minnesota Statutes 2006, section 297A.61, subdivision 4, is amended to read:<br/>
<a id="pl.162.14"></a><var>162.14</var>    Subd. 4. <b>Retail sale.</b> (a) A "retail sale" means any sale, lease, or rental for any <br/>
<a id="pl.162.15"></a><var>162.15</var>purpose, other than resale, sublease, or subrent of items by the purchaser in the normal <br/>
<a id="pl.162.16"></a><var>162.16</var>course of business as defined in subdivision 21.<br/>
<a id="pl.162.17"></a><var>162.17</var>    (b) A sale of property used by the owner only by leasing it to others or by holding it <br/>
<a id="pl.162.18"></a><var>162.18</var>in an effort to lease it, and put to no use by the owner other than resale after the lease or <br/>
<a id="pl.162.19"></a><var>162.19</var>effort to lease, is a sale of property for resale.<br/>
<a id="pl.162.20"></a><var>162.20</var>    (c) A sale of master computer software that is purchased and used to make copies for <br/>
<a id="pl.162.21"></a><var>162.21</var>sale or lease is a sale of property for resale.<br/>
<a id="pl.162.22"></a><var>162.22</var>    (d) A sale of building materials, supplies, and equipment to owners, contractors, <br/>
<a id="pl.162.23"></a><var>162.23</var>subcontractors, or builders for the erection of buildings or the alteration, repair, or <br/>
<a id="pl.162.24"></a><var>162.24</var>improvement of real property is a retail sale in whatever quantity sold, whether the sale is <br/>
<a id="pl.162.25"></a><var>162.25</var>for purposes of resale in the form of real property or otherwise.<br/>
<a id="pl.162.26"></a><var>162.26</var>    (e) A sale of carpeting, linoleum, or similar floor covering to a person who provides <br/>
<a id="pl.162.27"></a><var>162.27</var>for installation of the floor covering is a retail sale and not a sale for resale since a sale <br/>
<a id="pl.162.28"></a><var>162.28</var>of floor covering which includes installation is a contract for the improvement of real <br/>
<a id="pl.162.29"></a><var>162.29</var>property.<br/>
<a id="pl.162.30"></a><var>162.30</var>    (f) A sale of shrubbery, plants, sod, trees, and similar items to a person who provides <br/>
<a id="pl.162.31"></a><var>162.31</var>for installation of the items is a retail sale and not a sale for resale since a sale of <br/>
<a id="pl.162.32"></a><var>162.32</var>shrubbery, plants, sod, trees, and similar items that includes installation is a contract for <br/>
<a id="pl.162.33"></a><var>162.33</var>the improvement of real property.<br/>
<a id="pl.162.34"></a><var>162.34</var>    (g) A sale of tangible personal property that is awarded as prizes is a retail sale and <br/>
<a id="pl.162.35"></a><var>162.35</var>is not considered a sale of property for resale.<br/>
<a id="pl.163.1"></a><var>163.1</var>    (h) A sale of tangible personal property utilized or employed in the furnishing or <br/>
<a id="pl.163.2"></a><var>163.2</var>providing of services under subdivision 3, paragraph (g), clause (1), including, but not <br/>
<a id="pl.163.3"></a><var>163.3</var>limited to, property given as promotional items, is a retail sale and is not considered a <br/>
<a id="pl.163.4"></a><var>163.4</var>sale of property for resale.<br/>
<a id="pl.163.5"></a><var>163.5</var>    (i) A sale of tangible personal property used in conducting lawful gambling under <br/>
<a id="pl.163.6"></a><var>163.6</var>chapter 349 or the State Lottery under chapter 349A, including, but not limited to, <br/>
<a id="pl.163.7"></a><var>163.7</var>property given as promotional items, is a retail sale and is not considered a sale of <br/>
<a id="pl.163.8"></a><var>163.8</var>property for resale.<br/>
<a id="pl.163.9"></a><var>163.9</var>    (j) A sale of machines, equipment, or devices that are used to furnish, provide, or <br/>
<a id="pl.163.10"></a><var>163.10</var>dispense goods or services, including, but not limited to, coin-operated devices, is a retail <br/>
<a id="pl.163.11"></a><var>163.11</var>sale and is not considered a sale of property for resale.<br/>
<a id="pl.163.12"></a><var>163.12</var>    (k) In the case of a lease, a retail sale occurs (1) when an obligation to make a lease <br/>
<a id="pl.163.13"></a><var>163.13</var>payment becomes due under the terms of the agreement or the trade practices of the <br/>
<a id="pl.163.14"></a><var>163.14</var>lessor or (2) in the case of a lease of a motor vehicle, as defined in section 
         <statute_ref>297B.01, <br/>
<a id="pl.163.15"></a><var>163.15</var>subdivision 5
         </statute_ref>, but excluding vehicles with a manufacturer's gross vehicle weight rating <br/>
<a id="pl.163.16"></a><var>163.16</var>greater than 10,000 pounds and rentals of vehicles for not more than 28 days, at the time <br/>
<a id="pl.163.17"></a><var>163.17</var>the lease is executed.<br/>
<a id="pl.163.18"></a><var>163.18</var>    (l) In the case of a conditional sales contract, a retail sale occurs upon the transfer of <br/>
<a id="pl.163.19"></a><var>163.19</var>title or possession of the tangible personal property.<br/>
<a id="pl.163.20"></a><var>163.20</var>    (m) A sale of a bundled transaction in which one or more of the products included <br/>
<a id="pl.163.21"></a><var>163.21</var>in the bundle is a taxable product is a retail sale, except that if one of the products <br/>
<a id="pl.163.22"></a><var>163.22</var>is a telecommunication service, ancillary service, Internet access, or audio or video <br/>
<a id="pl.163.23"></a><var>163.23</var>programming service, and the seller has maintained books and records identifying through <br/>
<a id="pl.163.24"></a><var>163.24</var>reasonable and verifiable standards the portions of the price that are attributable to the <br/>
<a id="pl.163.25"></a><var>163.25</var>distinct and separately identifiable products, then the products are not considered part of a <br/>
<a id="pl.163.26"></a><var>163.26</var>bundled transaction. For purposes of this paragraph:<br/>
<a id="pl.163.27"></a><var>163.27</var>    (1) the books and records maintained by the seller must be maintained in the regular <br/>
<a id="pl.163.28"></a><var>163.28</var>course of business, and do not include books and records created and maintained by the <br/>
<a id="pl.163.29"></a><var>163.29</var>seller primarily for tax purposes; <br/>
<a id="pl.163.30"></a><var>163.30</var>    (2) books and records maintained in the regular course of business include, but are <br/>
<a id="pl.163.31"></a><var>163.31</var>not limited to, financial statements, general ledgers, invoicing and billing systems and <br/>
<a id="pl.163.32"></a><var>163.32</var>reports, and reports for regulatory tariffs and other regulatory matters; and<br/>
<a id="pl.163.33"></a><var>163.33</var>    (3) books and records are maintained primarily for tax purposes when the books <br/>
<a id="pl.163.34"></a><var>163.34</var>and records identify taxable and nontaxable portions of the price, but the seller maintains <br/>
<a id="pl.163.35"></a><var>163.35</var>other books and records that identify different prices attributable to the distinct products <br/>
<a id="pl.163.36"></a><var>163.36</var>included in the same bundled transaction.<br/>
<a id="pl.164.1"></a><var>164.1</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.164.2"></a><var>164.2</var>made after December 31, 2007.<br/>
<br/>
<a id="bill.12.7.0"></a><a id="pl.164.3"></a><var>164.3</var>    Sec. 7. Minnesota Statutes 2006, section 297A.61, subdivision 7, is amended to read:<br/>
<a id="pl.164.4"></a><var>164.4</var>    Subd. 7. <b>Sales price.</b> (a) "Sales price" means the measure subject to sales tax, and <br/>
<a id="pl.164.5"></a><var>164.5</var>means the total amount of consideration, including cash, credit, personal property, and <br/>
<a id="pl.164.6"></a><var>164.6</var>services, for which personal property or services are sold, leased, or rented, valued in <br/>
<a id="pl.164.7"></a><var>164.7</var>money, whether received in money or otherwise, without any deduction for the following:<br/>
<a id="pl.164.8"></a><var>164.8</var>    (1) the seller's cost of the property sold;<br/>
<a id="pl.164.9"></a><var>164.9</var>    (2) the cost of materials used, labor or service cost, interest, losses, all costs of <br/>
<a id="pl.164.10"></a><var>164.10</var>transportation to the seller, all taxes imposed on the seller, and any other expenses of <br/>
<a id="pl.164.11"></a><var>164.11</var>the seller;<br/>
<a id="pl.164.12"></a><var>164.12</var>    (3) charges by the seller for any services necessary to complete the sale, other than <br/>
<a id="pl.164.13"></a><var>164.13</var>delivery and installation charges;<br/>
<a id="pl.164.14"></a><var>164.14</var>    (4) delivery charges, except the percentage of the delivery charge allocated to <br/>
<a id="pl.164.15"></a><var>164.15</var>delivery of tax exempt property, when the delivery charge is allocated by using either (i) a <br/>
<a id="pl.164.16"></a><var>164.16</var>percentage based on the total sales price of the taxable property compared to the total sales <br/>
<a id="pl.164.17"></a><var>164.17</var>price of all property in the shipment, or (ii) a percentage based on the total weight of the <br/>
<a id="pl.164.18"></a><var>164.18</var>taxable property compared to the total weight of all property in the shipment; and<br/>
<a id="pl.164.19"></a><var>164.19</var>    (5) installation charges; and.<br/>
<a id="pl.164.20"></a><var>164.20</var>    (6) the value of exempt property given to the purchaser when taxable and exempt <br/>
<a id="pl.164.21"></a><var>164.21</var>personal property have been bundled together and sold by the seller as a single product <br/>
<a id="pl.164.22"></a><var>164.22</var>or piece of merchandise.<br/>
<a id="pl.164.23"></a><var>164.23</var>    (b) Sales price does not include:<br/>
<a id="pl.164.24"></a><var>164.24</var>    (1) discounts, including cash, terms, or coupons, that are not reimbursed by a third <br/>
<a id="pl.164.25"></a><var>164.25</var>party and that are allowed by the seller and taken by a purchaser on a sale;<br/>
<a id="pl.164.26"></a><var>164.26</var>    (2) interest, financing, and carrying charges from credit extended on the sale of <br/>
<a id="pl.164.27"></a><var>164.27</var>personal property or services, if the amount is separately stated on the invoice, bill of sale, <br/>
<a id="pl.164.28"></a><var>164.28</var>or similar document given to the purchaser; and<br/>
<a id="pl.164.29"></a><var>164.29</var>    (3) any taxes legally imposed directly on the consumer that are separately stated on <br/>
<a id="pl.164.30"></a><var>164.30</var>the invoice, bill of sale, or similar document given to the purchaser.<br/>
<a id="pl.164.31"></a><var>164.31</var>    (c) Sales price includes consideration received by the seller from third parties if:<br/>
<a id="pl.164.32"></a><var>164.32</var>    (1) the seller actually receives consideration from a party other than the purchaser <br/>
<a id="pl.164.33"></a><var>164.33</var>and the consideration is directly related to a price reduction or discount on the sale;<br/>
<a id="pl.164.34"></a><var>164.34</var>    (2) the seller has an obligation to pass the price reduction or discount through to <br/>
<a id="pl.164.35"></a><var>164.35</var>the purchaser; <br/>
<a id="pl.165.1"></a><var>165.1</var>    (3) the amount of the consideration attributable to the sale is fixed and determinable <br/>
<a id="pl.165.2"></a><var>165.2</var>by the seller at the time of the sale of the item to the purchaser; and<br/>
<a id="pl.165.3"></a><var>165.3</var>    (4) one of the following criteria is met: <br/>
<a id="pl.165.4"></a><var>165.4</var>    (i) the purchaser presents a coupon, certificate, or other documentation to the seller <br/>
<a id="pl.165.5"></a><var>165.5</var>to claim a price reduction or discount when the coupon, certificate, or documentation is <br/>
<a id="pl.165.6"></a><var>165.6</var>authorized, distributed, or granted by a third party with the understanding that the third <br/>
<a id="pl.165.7"></a><var>165.7</var>party will reimburse any seller to whom the coupon, certificate, or documentation is <br/>
<a id="pl.165.8"></a><var>165.8</var>presented; <br/>
<a id="pl.165.9"></a><var>165.9</var>    (ii) the purchaser identifies himself or herself to the seller as a member of a group or <br/>
<a id="pl.165.10"></a><var>165.10</var>organization entitled to a price reduction or discount. A "preferred customer" card that is <br/>
<a id="pl.165.11"></a><var>165.11</var>available to any customer does not constitute membership in such a group; or <br/>
<a id="pl.165.12"></a><var>165.12</var>    (iii) the price reduction or discount is identified as a third-party price reduction or <br/>
<a id="pl.165.13"></a><var>165.13</var>discount on the invoice received by the purchaser or on a coupon, certificate, or other <br/>
<a id="pl.165.14"></a><var>165.14</var>documentation presented by the purchaser.<br/>
<a id="pl.165.15"></a><var>165.15</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.165.16"></a><var>165.16</var>made after December 31, 2007, except that the amendment to paragraph (a), clause (4), is <br/>
<a id="pl.165.17"></a><var>165.17</var>effective the day following final enactment.<br/>
<br/>
<a id="bill.12.8.0"></a><a id="pl.165.18"></a><var>165.18</var>    Sec. 8. Minnesota Statutes 2006, section 297A.61, subdivision 10, is amended to read:<br/>
<a id="pl.165.19"></a><var>165.19</var>    Subd. 10. <b>Tangible personal property.</b> (a) "Tangible personal property" means <br/>
<a id="pl.165.20"></a><var>165.20</var>personal property that can be seen, weighed, measured, felt, or touched, or that is in any <br/>
<a id="pl.165.21"></a><var>165.21</var>other manner perceptible to the senses. "Tangible personal property" includes, but is not <br/>
<a id="pl.165.22"></a><var>165.22</var>limited to, electricity, water, gas, steam, and prewritten computer software, and prepaid <br/>
<a id="pl.165.23"></a><var>165.23</var>calling cards.<br/>
<a id="pl.165.24"></a><var>165.24</var>    (b) Tangible personal property does not include:<br/>
<a id="pl.165.25"></a><var>165.25</var>    (1) large ponderous machinery and equipment used in a business or production <br/>
<a id="pl.165.26"></a><var>165.26</var>activity which at common law would be considered to be real property;<br/>
<a id="pl.165.27"></a><var>165.27</var>    (2) property which is subject to an ad valorem property tax;<br/>
<a id="pl.165.28"></a><var>165.28</var>    (3) property described in section 
         <statute_ref>272.02, subdivision 9</statute_ref>, clauses (a) to (d); and <br/>
<a id="pl.165.29"></a><var>165.29</var>    (4) property described in section 
         <statute_ref>272.03, subdivision 2</statute_ref>, clauses (3) and (5). <br/>
<a id="pl.165.30"></a><var>165.30</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.165.31"></a><var>165.31</var>made after December 31, 2007.<br/>
<br/>
<a id="bill.12.9.0"></a><a id="pl.165.32"></a><var>165.32</var>    Sec. 9. Minnesota Statutes 2006, section 297A.61, subdivision 24, is amended to read:<br/>
<a id="pl.166.1"></a><var>166.1</var>    Subd. 24. <b>Telecommunications services.</b> (a) "Telecommunications services" means <br/>
<a id="pl.166.2"></a><var>166.2</var>the electronic transmission, conveyance, or routing of voice, data, audio, video, or any <br/>
<a id="pl.166.3"></a><var>166.3</var>other information or signals to a point, or between or among points, by or through any <br/>
<a id="pl.166.4"></a><var>166.4</var>electronic, satellite, optical, microwave, or other medium or method now in existence or <br/>
<a id="pl.166.5"></a><var>166.5</var>hereafter devised, regardless of the protocol used for such transmission, conveyance, <br/>
<a id="pl.166.6"></a><var>166.6</var>or routing.<br/>
<a id="pl.166.7"></a><var>166.7</var>    (b) Telecommunications services includes the furnishing for consideration of access <br/>
<a id="pl.166.8"></a><var>166.8</var>to telephone services by a hotel to its guests. include transmission, conveyance, or routing <br/>
<a id="pl.166.9"></a><var>166.9</var>in which computer processing applications are used to act on the form, code, or protocol <br/>
<a id="pl.166.10"></a><var>166.10</var>of the content for purposes of transmission, conveyance, or routing, without regard to <br/>
<a id="pl.166.11"></a><var>166.11</var>whether the service is referred to as voice over Internet protocol services or is classified by <br/>
<a id="pl.166.12"></a><var>166.12</var>the Federal Communications Commission as enhanced or value added.<br/>
<a id="pl.166.13"></a><var>166.13</var>    (c) Telecommunications services do not include:<br/>
<a id="pl.166.14"></a><var>166.14</var>    (1) services purchased with a prepaid telephone calling card;<br/>
<a id="pl.166.15"></a><var>166.15</var>    (2) private communication service purchased by an agent acting on behalf of the <br/>
<a id="pl.166.16"></a><var>166.16</var>State Lottery;<br/>
<a id="pl.166.17"></a><var>166.17</var>    (3) information services; and<br/>
<a id="pl.166.18"></a><var>166.18</var>    (4) purchases of telecommunications when the purchaser uses the purchased services <br/>
<a id="pl.166.19"></a><var>166.19</var>as a component part of or integrates such service into another telecommunications service <br/>
<a id="pl.166.20"></a><var>166.20</var>that is sold by the purchaser in the normal course of business.<br/>
<a id="pl.166.21"></a><var>166.21</var>    (d) For purposes of this subdivision, "information services" means the offering of <br/>
<a id="pl.166.22"></a><var>166.22</var>the capability for generating, acquiring, storing, transforming, processing, retrieving, <br/>
<a id="pl.166.23"></a><var>166.23</var>utilizing, or making available information.<br/>
<a id="pl.166.24"></a><var>166.24</var>    (1) data processing and information services that allow data to be generated, <br/>
<a id="pl.166.25"></a><var>166.25</var>acquired, stored, processed, or retrieved and delivered by an electronic transmission to <br/>
<a id="pl.166.26"></a><var>166.26</var>a purchaser when the purchaser's primary purpose for the underlying transaction is the <br/>
<a id="pl.166.27"></a><var>166.27</var>processed data or information;<br/>
<a id="pl.166.28"></a><var>166.28</var>    (2) installation or maintenance of wiring or equipment on a customer's premises;<br/>
<a id="pl.166.29"></a><var>166.29</var>    (3) tangible personal property;<br/>
<a id="pl.166.30"></a><var>166.30</var>    (4) advertising, including, but not limited to, directory advertising;<br/>
<a id="pl.166.31"></a><var>166.31</var>    (5) billing and collection services provided to third parties;<br/>
<a id="pl.166.32"></a><var>166.32</var>    (6) Internet access service;<br/>
<a id="pl.166.33"></a><var>166.33</var>    (7) radio and television audio and video programming services, regardless of the <br/>
<a id="pl.166.34"></a><var>166.34</var>medium, including the furnishing of transmission, conveyance, and routing of such <br/>
<a id="pl.166.35"></a><var>166.35</var>services by the programming service provider. Radio and television audio and video <br/>
<a id="pl.166.36"></a><var>166.36</var>programming services includes, but is not limited to, cable service as defined in United <br/>
<a id="pl.167.1"></a><var>167.1</var>States Code, title 47, section 522(6), and audio and video programming services delivered <br/>
<a id="pl.167.2"></a><var>167.2</var>by commercial mobile radio service providers, as defined in Code of Federal Regulations, <br/>
<a id="pl.167.3"></a><var>167.3</var>title 47, section 20.3;<br/>
<a id="pl.167.4"></a><var>167.4</var>    (8) ancillary services; or<br/>
<a id="pl.167.5"></a><var>167.5</var>    (9) digital products delivered electronically, including, but not limited to, software, <br/>
<a id="pl.167.6"></a><var>167.6</var>music, video, reading materials, or ring tones.<br/>
<a id="pl.167.7"></a><var>167.7</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.167.8"></a><var>167.8</var>made after December 31, 2007.<br/>
<br/>
<a id="bill.12.10.0"></a><a id="pl.167.9"></a><var>167.9</var>    Sec. 10. Minnesota Statutes 2006, section 297A.61, is amended by adding a <br/>
<a id="pl.167.10"></a><var>167.10</var>subdivision to read:<br/>
<a id="pl.167.11"></a><var>167.11</var>    Subd. 38. <b>Bundled transaction.</b> (a) "Bundled transaction" means the retail sale <br/>
<a id="pl.167.12"></a><var>167.12</var>of two or more products when the products are otherwise distinct and identifiable, and <br/>
<a id="pl.167.13"></a><var>167.13</var>the products are sold for one nonitemized price. As used in this subdivision, "product" <br/>
<a id="pl.167.14"></a><var>167.14</var>includes tangible personal property, services, intangibles, and digital goods, but does not <br/>
<a id="pl.167.15"></a><var>167.15</var>include real property or services to real property. A bundled transaction does not include <br/>
<a id="pl.167.16"></a><var>167.16</var>the sale of any products in which the sales price varies, or is negotiable, based on the <br/>
<a id="pl.167.17"></a><var>167.17</var>selection by the purchaser of the products included in the transaction.<br/>
<a id="pl.167.18"></a><var>167.18</var>    (b) For purposes of this subdivision, "distinct and identifiable" products does not <br/>
<a id="pl.167.19"></a><var>167.19</var>include:<br/>
<a id="pl.167.20"></a><var>167.20</var>    (1) packaging and other materials, such as containers, boxes, sacks, bags, and <br/>
<a id="pl.167.21"></a><var>167.21</var>bottles, wrapping, labels, tags, and instruction guides, that accompany the retail sale of the <br/>
<a id="pl.167.22"></a><var>167.22</var>products and are incidental or immaterial to the retail sale. Examples of packaging that are <br/>
<a id="pl.167.23"></a><var>167.23</var>incidental or immaterial include grocery sacks, shoe boxes, dry cleaning garment bags, <br/>
<a id="pl.167.24"></a><var>167.24</var>and express delivery envelopes and boxes;<br/>
<a id="pl.167.25"></a><var>167.25</var>    (2) a promotional product provided free of charge with the required purchase of <br/>
<a id="pl.167.26"></a><var>167.26</var>another product. A promotional product is provided free of charge if the sales price of <br/>
<a id="pl.167.27"></a><var>167.27</var>another product, which is required to be purchased in order to receive the promotional <br/>
<a id="pl.167.28"></a><var>167.28</var>product, does not vary depending on the inclusion of the promotional product; and <br/>
<a id="pl.167.29"></a><var>167.29</var>    (3) items included in the definition of sales price.<br/>
<a id="pl.167.30"></a><var>167.30</var>    (c) For purposes of this subdivision, the term "one nonitemized price" does not <br/>
<a id="pl.167.31"></a><var>167.31</var>include a price that is separately identified by product on binding sales or other supporting <br/>
<a id="pl.167.32"></a><var>167.32</var>sales-related documentation made available to the customer in paper or electronic form <br/>
<a id="pl.167.33"></a><var>167.33</var>including, but not limited to an invoice, bill of sale, receipt, contract, service agreement, <br/>
<a id="pl.167.34"></a><var>167.34</var>lease agreement, periodic notice of rates and services, rate card, or price list.<br/>
<a id="pl.168.1"></a><var>168.1</var>    (d) A transaction that otherwise meets the definition of a bundled transaction is <br/>
<a id="pl.168.2"></a><var>168.2</var>not a bundled transaction if it is: <br/>
<a id="pl.168.3"></a><var>168.3</var>    (1) the retail sale of tangible personal property and a service and the tangible <br/>
<a id="pl.168.4"></a><var>168.4</var>personal property is essential to the use of the service, and is provided exclusively in <br/>
<a id="pl.168.5"></a><var>168.5</var>connection with the service, and the true object of the transaction is the service; <br/>
<a id="pl.168.6"></a><var>168.6</var>    (2) the retail sale of services if one service is provided that is essential to the use or <br/>
<a id="pl.168.7"></a><var>168.7</var>receipt of a second service and the first service is provided exclusively in connection with <br/>
<a id="pl.168.8"></a><var>168.8</var>the second service and the true object of the transaction is the second service; <br/>
<a id="pl.168.9"></a><var>168.9</var>    (3) a transaction that includes taxable products and nontaxable products and the <br/>
<a id="pl.168.10"></a><var>168.10</var>purchase price or sales price of the taxable products is de minimis; or <br/>
<a id="pl.168.11"></a><var>168.11</var>    (4) the retail sale of exempt tangible personal property and taxable tangible personal <br/>
<a id="pl.168.12"></a><var>168.12</var>property if:<br/>
<a id="pl.168.13"></a><var>168.13</var>    (i) the transaction includes food and food ingredients, drugs, durable medical <br/>
<a id="pl.168.14"></a><var>168.14</var>equipment, mobility enhancing equipment, over-the-counter drugs, prosthetic devices, <br/>
<a id="pl.168.15"></a><var>168.15</var>or medical supplies; and<br/>
<a id="pl.168.16"></a><var>168.16</var>    (ii) the seller's purchase price or sales price of the taxable tangible personal property <br/>
<a id="pl.168.17"></a><var>168.17</var>is 50 percent or less of the total purchase price or sales price of the bundled tangible <br/>
<a id="pl.168.18"></a><var>168.18</var>personal property. Sellers must not use a combination of the purchase price and sales <br/>
<a id="pl.168.19"></a><var>168.19</var>price of the tangible personal property when making the 50 percent determination for <br/>
<a id="pl.168.20"></a><var>168.20</var>a transaction.<br/>
<a id="pl.168.21"></a><var>168.21</var>    (e) For purposes of this subdivision, "purchase price" means the measure subject to <br/>
<a id="pl.168.22"></a><var>168.22</var>use tax on purchases made by the seller, and "de minimis" means that the seller's purchase <br/>
<a id="pl.168.23"></a><var>168.23</var>price or sales price of the taxable products is ten percent or less of the total purchase <br/>
<a id="pl.168.24"></a><var>168.24</var>price or sales price of the bundled products. Sellers shall use either the purchase price <br/>
<a id="pl.168.25"></a><var>168.25</var>or the sales price of the products to determine if the taxable products are de minimis. <br/>
<a id="pl.168.26"></a><var>168.26</var>Sellers must not use a combination of the purchase price and sales price of the products <br/>
<a id="pl.168.27"></a><var>168.27</var>to determine if the taxable products are de minimis. Sellers shall use the full term of a <br/>
<a id="pl.168.28"></a><var>168.28</var>service contract to determine if the taxable products are de minimis.<br/>
<a id="pl.168.29"></a><var>168.29</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.168.30"></a><var>168.30</var>made after December 31, 2007.<br/>
<br/>
<a id="bill.12.11.0"></a><a id="pl.168.31"></a><var>168.31</var>    Sec. 11. Minnesota Statutes 2006, section 297A.61, is amended by adding a <br/>
<a id="pl.168.32"></a><var>168.32</var>subdivision to read:<br/>
<a id="pl.168.33"></a><var>168.33</var>    Subd. 39. <b>Ancillary services.</b> "Ancillary services" means services that are <br/>
<a id="pl.168.34"></a><var>168.34</var>associated with or incidental to the provision of telecommunications services, including, <br/>
<a id="pl.169.1"></a><var>169.1</var>but not limited to, conference bridging service, detailed telecommunications billing, <br/>
<a id="pl.169.2"></a><var>169.2</var>directory assistance, vertical service, and voice mail services.<br/>
<a id="pl.169.3"></a><var>169.3</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.169.4"></a><var>169.4</var>made after December 31, 2007.<br/>
<br/>
<a id="bill.12.12.0"></a><a id="pl.169.5"></a><var>169.5</var>    Sec. 12. Minnesota Statutes 2006, section 297A.61, is amended by adding a <br/>
<a id="pl.169.6"></a><var>169.6</var>subdivision to read:<br/>
<a id="pl.169.7"></a><var>169.7</var>    Subd. 40. <b>Conference bridging service.</b> "Conference bridging service" means an <br/>
<a id="pl.169.8"></a><var>169.8</var>ancillary service that links two or more participants of an audio or video conference call <br/>
<a id="pl.169.9"></a><var>169.9</var>and may include the provision of a telephone number. Conference bridging service does <br/>
<a id="pl.169.10"></a><var>169.10</var>not include the telecommunications services used to reach the conference bridge.<br/>
<a id="pl.169.11"></a><var>169.11</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.169.12"></a><var>169.12</var>made after December 31, 2007.<br/>
<br/>
<a id="bill.12.13.0"></a><a id="pl.169.13"></a><var>169.13</var>    Sec. 13. Minnesota Statutes 2006, section 297A.61, is amended by adding a <br/>
<a id="pl.169.14"></a><var>169.14</var>subdivision to read:<br/>
<a id="pl.169.15"></a><var>169.15</var>    Subd. 41. <b>Detailed telecommunications billing service.</b> "Detailed <br/>
<a id="pl.169.16"></a><var>169.16</var>telecommunications billing service" means an ancillary service of separately stating <br/>
<a id="pl.169.17"></a><var>169.17</var>information pertaining to individual calls on a customer's billing statement.<br/>
<a id="pl.169.18"></a><var>169.18</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.169.19"></a><var>169.19</var>made after December 31, 2007.<br/>
<br/>
<a id="bill.12.14.0"></a><a id="pl.169.20"></a><var>169.20</var>    Sec. 14. Minnesota Statutes 2006, section 297A.61, is amended by adding a <br/>
<a id="pl.169.21"></a><var>169.21</var>subdivision to read:<br/>
<a id="pl.169.22"></a><var>169.22</var>    Subd. 42. <b>Directory assistance.</b> "Directory assistance" means an ancillary service <br/>
<a id="pl.169.23"></a><var>169.23</var>of providing telephone number information or address information, or both.<br/>
<a id="pl.169.24"></a><var>169.24</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.169.25"></a><var>169.25</var>made after December 31, 2007.<br/>
<br/>
<a id="bill.12.15.0"></a><a id="pl.169.26"></a><var>169.26</var>    Sec. 15. Minnesota Statutes 2006, section 297A.61, is amended by adding a <br/>
<a id="pl.169.27"></a><var>169.27</var>subdivision to read:<br/>
<a id="pl.169.28"></a><var>169.28</var>    Subd. 43. <b>Vertical service.</b> "Vertical service" means an ancillary service that is <br/>
<a id="pl.169.29"></a><var>169.29</var>offered in connection with one or more telecommunications services and which offers <br/>
<a id="pl.170.1"></a><var>170.1</var>advanced calling features that allow customers to identify callers and to manage multiple <br/>
<a id="pl.170.2"></a><var>170.2</var>calls and call connections, including conference bridging services.<br/>
<a id="pl.170.3"></a><var>170.3</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.170.4"></a><var>170.4</var>made after December 31, 2007.<br/>
<br/>
<a id="bill.12.16.0"></a><a id="pl.170.5"></a><var>170.5</var>    Sec. 16. Minnesota Statutes 2006, section 297A.61, is amended by adding a <br/>
<a id="pl.170.6"></a><var>170.6</var>subdivision to read:<br/>
<a id="pl.170.7"></a><var>170.7</var>    Subd. 44. <b>Voice mail service.</b> "Voice mail service" means an ancillary service that <br/>
<a id="pl.170.8"></a><var>170.8</var>enables the customer to store, send, or receive recorded messages. Voice mail service <br/>
<a id="pl.170.9"></a><var>170.9</var>does not include any vertical services that the customer may be required to have in order <br/>
<a id="pl.170.10"></a><var>170.10</var>to utilize the voice mail service.<br/>
<a id="pl.170.11"></a><var>170.11</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.170.12"></a><var>170.12</var>made after December 31, 2007.<br/>
<br/>
<a id="bill.12.17.0"></a><a id="pl.170.13"></a><var>170.13</var>    Sec. 17. Minnesota Statutes 2006, section 297A.61, is amended by adding a <br/>
<a id="pl.170.14"></a><var>170.14</var>subdivision to read:<br/>
<a id="pl.170.15"></a><var>170.15</var>    Subd. 45. <b>Ring tone.</b> "Ring tone" means a digitized sound file that is downloaded <br/>
<a id="pl.170.16"></a><var>170.16</var>onto a device and that may be used to alert the customer of a telecommunication service <br/>
<a id="pl.170.17"></a><var>170.17</var>with respect to a communication.<br/>
<a id="pl.170.18"></a><var>170.18</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.170.19"></a><var>170.19</var>made after December 31, 2007.<br/>
<br/>
<a id="bill.12.18.0"></a><a id="pl.170.20"></a><var>170.20</var>    Sec. 18. Minnesota Statutes 2006, section 297A.61, is amended by adding a <br/>
<a id="pl.170.21"></a><var>170.21</var>subdivision to read:<br/>
<a id="pl.170.22"></a><var>170.22</var>    Subd. 46. <b>Fur clothing.</b> "Fur clothing" means human wearing apparel that is <br/>
<a id="pl.170.23"></a><var>170.23</var>required by the Federal Fur Products Labeling Act, United States Code, title 15, section <br/>
<a id="pl.170.24"></a><var>170.24</var>69, to be labeled as a fur product, and the value of the fur components in the product <br/>
<a id="pl.170.25"></a><var>170.25</var>is more than three times the value of the next most valuable tangible component. For <br/>
<a id="pl.170.26"></a><var>170.26</var>purposes of this subdivision, "fur" means any animal skin or part of an animal skin with <br/>
<a id="pl.170.27"></a><var>170.27</var>hair, fleece, or fur fibers attached to it, either in its raw or processed state, but does not <br/>
<a id="pl.170.28"></a><var>170.28</var>include animal skins that have been converted into leather or suede, or from which the <br/>
<a id="pl.170.29"></a><var>170.29</var>hair, fleece, or fur fiber has been completely removed in processing the skins.<br/>
<a id="pl.170.30"></a><var>170.30</var><b>EFFECTIVE DATE.</b>This section is effective for sales and purchases made after <br/>
<a id="pl.170.31"></a><var>170.31</var>June 30, 2008.<br/>
<br/>
<a id="bill.12.19.0"></a><a id="pl.171.1"></a><var>171.1</var>    Sec. 19. Minnesota Statutes 2006, section 297A.63, subdivision 1, is amended to read:<br/>
<a id="pl.171.2"></a><var>171.2</var>    Subdivision 1. <b>Use of tangible personal property or taxable services.</b> (a) For the <br/>
<a id="pl.171.3"></a><var>171.3</var>privilege of using, storing, distributing, or consuming in Minnesota tangible personal <br/>
<a id="pl.171.4"></a><var>171.4</var>property or taxable services purchased for use, storage, distribution, or consumption in <br/>
<a id="pl.171.5"></a><var>171.5</var>this state, a use tax is imposed on a person in Minnesota. The tax is imposed on the <br/>
<a id="pl.171.6"></a><var>171.6</var>purchase price of retail sales of the tangible personal property or taxable services at the <br/>
<a id="pl.171.7"></a><var>171.7</var>rate of tax imposed under section 
         <statute_ref>297A.62</statute_ref>. A person that purchases property from a <br/>
<a id="pl.171.8"></a><var>171.8</var>Minnesota retailer and returns the tangible personal property to a point within Minnesota, <br/>
<a id="pl.171.9"></a><var>171.9</var>except in the course of interstate commerce, after it was delivered outside of Minnesota, <br/>
<a id="pl.171.10"></a><var>171.10</var>is subject to the use tax. <br/>
<a id="pl.171.11"></a><var>171.11</var>    (b) No tax is imposed under paragraph (a) if the tax imposed by section 
         <statute_ref>297A.62</statute_ref> <br/>
<a id="pl.171.12"></a><var>171.12</var>was paid on the sales price of the tangible personal property or taxable services. <br/>
<a id="pl.171.13"></a><var>171.13</var>    (c) No tax is imposed under paragraph (a) if the purchase meets the requirements for <br/>
<a id="pl.171.14"></a><var>171.14</var>exemption under section 
         <statute_ref>297A.67, subdivision 21</statute_ref>. <br/>
<a id="pl.171.15"></a><var>171.15</var>    (d) When a transaction otherwise meets the definition of a bundled transaction, but <br/>
<a id="pl.171.16"></a><var>171.16</var>is not a bundled transaction under section 297A.61, subdivision 38, paragraph (d), and <br/>
<a id="pl.171.17"></a><var>171.17</var>the seller's purchase price of the taxable product or taxable tangible personal property is <br/>
<a id="pl.171.18"></a><var>171.18</var>equal to or greater than $100, then use tax is imposed on the purchase price of the taxable <br/>
<a id="pl.171.19"></a><var>171.19</var>product or taxable personal property. For purposes of this paragraph, "purchase price" <br/>
<a id="pl.171.20"></a><var>171.20</var>means the measure subject to use tax on purchases made by the seller.<br/>
<a id="pl.171.21"></a><var>171.21</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.171.22"></a><var>171.22</var>made after December 31, 2007.<br/>
<br/>
<a id="bill.12.20.0"></a><a id="pl.171.23"></a><var>171.23</var>    Sec. 20. Minnesota Statutes 2006, section 297A.665, is amended to read:<br/>
<a id="pl.171.24"></a><var>171.24</var><b>297A.665 PRESUMPTION OF TAX; BURDEN OF PROOF.</b><br/>
<a id="pl.171.25"></a><var>171.25</var>    (a) For the purpose of the proper administration of this chapter and to prevent <br/>
<a id="pl.171.26"></a><var>171.26</var>evasion of the tax, until the contrary is established, it is presumed that:<br/>
<a id="pl.171.27"></a><var>171.27</var>    (1) all gross receipts are subject to the tax; and<br/>
<a id="pl.171.28"></a><var>171.28</var>    (2) all retail sales for delivery in Minnesota are for storage, use, or other consumption <br/>
<a id="pl.171.29"></a><var>171.29</var>in Minnesota.<br/>
<a id="pl.171.30"></a><var>171.30</var>    (b) The burden of proving that a sale is not a taxable retail sale is on the seller. <br/>
<a id="pl.171.31"></a><var>171.31</var>However, the seller may take from the purchaser at the time of the sale a fully completed <br/>
<a id="pl.171.32"></a><var>171.32</var>exemption certificate which conclusively relieves the seller from collecting and remitting <br/>
<a id="pl.171.33"></a><var>171.33</var>the tax. This However, a seller is relieved of liability if:<br/>
<a id="pl.172.1"></a><var>172.1</var>    (1) the seller obtains a fully completed exemption certificate or all the relevant <br/>
<a id="pl.172.2"></a><var>172.2</var>information required by section 297A.72, subdivision 2, at the time of the sale or within <br/>
<a id="pl.172.3"></a><var>172.3</var>90 days after the date of the sale; or<br/>
<a id="pl.172.4"></a><var>172.4</var>    (2) if the seller has not obtained a fully completed exemption certificate or all the <br/>
<a id="pl.172.5"></a><var>172.5</var>relevant information required by section 297A.72, subdivision 2, within the time provided <br/>
<a id="pl.172.6"></a><var>172.6</var>in clause (1), within 120 days after a request for substantiation by the commissioner, <br/>
<a id="pl.172.7"></a><var>172.7</var>the seller either:<br/>
<a id="pl.172.8"></a><var>172.8</var>    (i) obtains in good faith a fully completed exemption certificate or all the relevant <br/>
<a id="pl.172.9"></a><var>172.9</var>information required by section 297A.72, subdivision 2, from the purchaser; or<br/>
<a id="pl.172.10"></a><var>172.10</var>    (ii) proves by other means that the transaction was not subject to tax.<br/>
<a id="pl.172.11"></a><var>172.11</var>    (c) Notwithstanding paragraph (b), relief from liability does not apply to a seller who: <br/>
<a id="pl.172.12"></a><var>172.12</var>    (1) fraudulently fails to collect the tax; or <br/>
<a id="pl.172.13"></a><var>172.13</var>    (2) solicits purchasers to participate in the unlawful claim of an exemption. If a <br/>
<a id="pl.172.14"></a><var>172.14</var>seller claiming that certain sales are exempt is not in possession of the required exemption <br/>
<a id="pl.172.15"></a><var>172.15</var>certificates within 60 days after receiving written notice from the commissioner that the <br/>
<a id="pl.172.16"></a><var>172.16</var>certificates are required, deductions claimed by the seller that required delivery of the <br/>
<a id="pl.172.17"></a><var>172.17</var>certificates must be disallowed. If the certificates are delivered to the commissioner within <br/>
<a id="pl.172.18"></a><var>172.18</var>the 60-day period, the commissioner may verify the reason or basis for the exemption <br/>
<a id="pl.172.19"></a><var>172.19</var>claimed in the certificates before allowing any deductions. A deduction must not be <br/>
<a id="pl.172.20"></a><var>172.20</var>granted on the basis of certificates delivered to the commissioner after the 60-day period.<br/>
<a id="pl.172.21"></a><var>172.21</var>    (c) (d) A purchaser of tangible personal property or any items listed in section <br/>
<statute_ref><a id="pl.172.22"></a><var>172.22</var>297A.63
         </statute_ref> that are shipped or brought to Minnesota by the purchaser has the burden <br/>
<a id="pl.172.23"></a><var>172.23</var>of proving that the property was not purchased from a retailer for storage, use, or <br/>
<a id="pl.172.24"></a><var>172.24</var>consumption in Minnesota. <br/>
<a id="pl.172.25"></a><var>172.25</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.172.26"></a><var>172.26</var>made after December 31, 2007.<br/>
<br/>
<a id="bill.12.21.0"></a><a id="pl.172.27"></a><var>172.27</var>    Sec. 21. Minnesota Statutes 2006, section 297A.669, subdivision 3, is amended to read:<br/>
<a id="pl.172.28"></a><var>172.28</var>    Subd. 3. <b>Defined telecommunications services sourcing.</b> The sale of the following <br/>
<a id="pl.172.29"></a><var>172.29</var>telecommunication services shall be sourced to each level of taxing jurisdiction in <br/>
<a id="pl.172.30"></a><var>172.30</var>paragraphs (a) to (d).<br/>
<a id="pl.172.31"></a><var>172.31</var>    (a) A sale of mobile telecommunications services, other than air-to-ground <br/>
<a id="pl.172.32"></a><var>172.32</var>radiotelephone service and prepaid calling service, is sourced to the customer's place of <br/>
<a id="pl.172.33"></a><var>172.33</var>primary use as required by the Mobile Telecommunications Sourcing Act.<br/>
<a id="pl.172.34"></a><var>172.34</var>    (b) A sale of postpaid calling service is sourced to the origination point of the <br/>
<a id="pl.172.35"></a><var>172.35</var>telecommunications signal as first identified by either:<br/>
<a id="pl.173.1"></a><var>173.1</var>    (1) the seller's telecommunications system; or<br/>
<a id="pl.173.2"></a><var>173.2</var>    (2) information received by the seller from its service provider, where the system <br/>
<a id="pl.173.3"></a><var>173.3</var>used to transport such signals is not that of the seller.<br/>
<a id="pl.173.4"></a><var>173.4</var>    (c) A sale of prepaid calling service or prepaid wireless calling service is sourced in <br/>
<a id="pl.173.5"></a><var>173.5</var>accordance with section 
         <statute_ref>297A.668, subdivision 2</statute_ref>. However, in the case of a sale of mobile <br/>
<a id="pl.173.6"></a><var>173.6</var>telecommunications service that is a prepaid telecommunications wireless calling service, <br/>
<a id="pl.173.7"></a><var>173.7</var>the rule provided in section 
         <statute_ref>297A.668, subdivision 2</statute_ref>, paragraph (f), shall include as an <br/>
<a id="pl.173.8"></a><var>173.8</var>option the location associated with the mobile telephone number. <br/>
<a id="pl.173.9"></a><var>173.9</var>    (d) A sale of a private communication service is sourced as follows:<br/>
<a id="pl.173.10"></a><var>173.10</var>    (1) service for a separate charge related to a customer channel termination point is <br/>
<a id="pl.173.11"></a><var>173.11</var>sourced to each level of jurisdiction in which the customer channel termination point <br/>
<a id="pl.173.12"></a><var>173.12</var>is located;<br/>
<a id="pl.173.13"></a><var>173.13</var>    (2) service where all customer termination points are located entirely within one <br/>
<a id="pl.173.14"></a><var>173.14</var>jurisdiction or levels of jurisdiction is sourced in such jurisdiction in which the customer <br/>
<a id="pl.173.15"></a><var>173.15</var>channel termination points are located;<br/>
<a id="pl.173.16"></a><var>173.16</var>    (3) service for segments of a channel between two customer channel termination <br/>
<a id="pl.173.17"></a><var>173.17</var>points located in different jurisdictions and which segment of channel are separately <br/>
<a id="pl.173.18"></a><var>173.18</var>charged is sourced 50 percent in each level of jurisdiction in which the customer channel <br/>
<a id="pl.173.19"></a><var>173.19</var>termination points are located; and<br/>
<a id="pl.173.20"></a><var>173.20</var>    (4) service for segments of a channel located in more than one jurisdiction or <br/>
<a id="pl.173.21"></a><var>173.21</var>levels of jurisdiction and which segments are not separately billed is sourced in each <br/>
<a id="pl.173.22"></a><var>173.22</var>jurisdiction based on the percentage determined by dividing the number of customer <br/>
<a id="pl.173.23"></a><var>173.23</var>channel termination points in the jurisdiction by the total number of customer channel <br/>
<a id="pl.173.24"></a><var>173.24</var>termination points.<br/>
<a id="pl.173.25"></a><var>173.25</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.173.26"></a><var>173.26</var>made after December 31, 2007.<br/>
<br/>
<a id="bill.12.22.0"></a><a id="pl.173.27"></a><var>173.27</var>    Sec. 22. Minnesota Statutes 2006, section 297A.669, subdivision 13, is amended to <br/>
<a id="pl.173.28"></a><var>173.28</var>read:<br/>
<a id="pl.173.29"></a><var>173.29</var>    Subd. 13. <b>Postpaid calling service.</b> "Postpaid calling service," for purposes of <br/>
<a id="pl.173.30"></a><var>173.30</var>this section, means the telecommunications service obtained by making a payment <br/>
<a id="pl.173.31"></a><var>173.31</var>on a call-by-call basis either through the use of a credit card or payment mechanism <br/>
<a id="pl.173.32"></a><var>173.32</var>such as a bank card, travel card, credit card, or debit card, or by a charge made to <br/>
<a id="pl.173.33"></a><var>173.33</var>a telephone number that is not associated with the origination or termination of the <br/>
<a id="pl.173.34"></a><var>173.34</var>telecommunications service. A postpaid calling service includes a telecommunications <br/>
<a id="pl.174.1"></a><var>174.1</var>service, except a prepaid wireless calling service, that would be a prepaid calling service <br/>
<a id="pl.174.2"></a><var>174.2</var>except it is not exclusively a telecommunication service.<br/>
<a id="pl.174.3"></a><var>174.3</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.174.4"></a><var>174.4</var>made after December 31, 2007.<br/>
<br/>
<a id="bill.12.23.0"></a><a id="pl.174.5"></a><var>174.5</var>    Sec. 23. Minnesota Statutes 2006, section 297A.669, subdivision 14, is amended to <br/>
<a id="pl.174.6"></a><var>174.6</var>read:<br/>
<a id="pl.174.7"></a><var>174.7</var>    Subd. 14. <b>Prepaid calling service.</b> "Prepaid calling service," for purposes of this <br/>
<a id="pl.174.8"></a><var>174.8</var>section, means a telecommunications service that:<br/>
<a id="pl.174.9"></a><var>174.9</var>    (1) provides the right to access exclusively telecommunications services, which; <br/>
<a id="pl.174.10"></a><var>174.10</var>    (2) must be paid for in advance and which; <br/>
<a id="pl.174.11"></a><var>174.11</var>    (3) enables the origination of calls using an access number or authorization code, <br/>
<a id="pl.174.12"></a><var>174.12</var>whether manually or electronically dialed,; and that <br/>
<a id="pl.174.13"></a><var>174.13</var>    (4) is sold in predetermined units or dollars of which the number declines with <br/>
<a id="pl.174.14"></a><var>174.14</var>use in a known amount.<br/>
<a id="pl.174.15"></a><var>174.15</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.174.16"></a><var>174.16</var>made after December 31, 2007.<br/>
<br/>
<a id="bill.12.24.0"></a><a id="pl.174.17"></a><var>174.17</var>    Sec. 24. Minnesota Statutes 2006, section 297A.669, is amended by adding a <br/>
<a id="pl.174.18"></a><var>174.18</var>subdivision to read:<br/>
<a id="pl.174.19"></a><var>174.19</var>    Subd. 14a. <b>Prepaid wireless calling service.</b> "Prepaid wireless calling service," for <br/>
<a id="pl.174.20"></a><var>174.20</var>purposes of this section, means a telecommunications service that: <br/>
<a id="pl.174.21"></a><var>174.21</var>    (1) provides the right to utilize mobile wireless service as well as other <br/>
<a id="pl.174.22"></a><var>174.22</var>nontelecommunications services, including the download of digital products delivered <br/>
<a id="pl.174.23"></a><var>174.23</var>electronically, content, and ancillary services; <br/>
<a id="pl.174.24"></a><var>174.24</var>    (2) must be paid for in advance; and <br/>
<a id="pl.174.25"></a><var>174.25</var>    (3) is sold in predetermined units or dollars of which the number declines with <br/>
<a id="pl.174.26"></a><var>174.26</var>use in a known amount.<br/>
<a id="pl.174.27"></a><var>174.27</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.174.28"></a><var>174.28</var>made after December 31, 2007.<br/>
<br/>
<a id="bill.12.25.0"></a><a id="pl.174.29"></a><var>174.29</var>    Sec. 25. Minnesota Statutes 2006, section 297A.669, is amended by adding a <br/>
<a id="pl.174.30"></a><var>174.30</var>subdivision to read:<br/>
<a id="pl.174.31"></a><var>174.31</var>    Subd. 17. <b>Ancillary service.</b> The sale of an ancillary service is sourced to the <br/>
<a id="pl.174.32"></a><var>174.32</var>customer's place of primary use.<br/>
<a id="pl.175.1"></a><var>175.1</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.175.2"></a><var>175.2</var>made after December 31, 2007.<br/>
<br/>
<a id="bill.12.26.0"></a><a id="pl.175.3"></a><var>175.3</var>    Sec. 26. Minnesota Statutes 2006, section 297A.67, subdivision 7, is amended to read:<br/>
<a id="pl.175.4"></a><var>175.4</var>    Subd. 7. <b>Drugs; medical devices.</b> (a) Sales of the following drugs and medical <br/>
<a id="pl.175.5"></a><var>175.5</var>devices are exempt:<br/>
<a id="pl.175.6"></a><var>175.6</var>    (1) drugs for human use, including over-the-counter drugs;<br/>
<a id="pl.175.7"></a><var>175.7</var>    (2) single-use finger-pricking devices for the extraction of blood and other single-use <br/>
<a id="pl.175.8"></a><var>175.8</var>devices and single-use diagnostic agents used in diagnosing, monitoring, or treating <br/>
<a id="pl.175.9"></a><var>175.9</var>diabetes;<br/>
<a id="pl.175.10"></a><var>175.10</var>    (3) insulin and medical oxygen for human use, regardless of whether prescribed <br/>
<a id="pl.175.11"></a><var>175.11</var>or sold over the counter;<br/>
<a id="pl.175.12"></a><var>175.12</var>    (4) prosthetic devices;<br/>
<a id="pl.175.13"></a><var>175.13</var>    (5) durable medical equipment for home use only;<br/>
<a id="pl.175.14"></a><var>175.14</var>    (6) mobility enhancing equipment; and<br/>
<a id="pl.175.15"></a><var>175.15</var>    (7) prescription corrective eyeglasses.; and<br/>
<a id="pl.175.16"></a><var>175.16</var>    (8) kidney dialysis equipment, including repair and replacement parts.<br/>
<a id="pl.175.17"></a><var>175.17</var>    (b) For purposes of this subdivision:<br/>
<a id="pl.175.18"></a><var>175.18</var>    (1) "Drug" means a compound, substance, or preparation, and any component of <br/>
<a id="pl.175.19"></a><var>175.19</var>a compound, substance, or preparation, other than food and food ingredients, dietary <br/>
<a id="pl.175.20"></a><var>175.20</var>supplements, or alcoholic beverages that is:<br/>
<a id="pl.175.21"></a><var>175.21</var>    (i) recognized in the official United States Pharmacopoeia, official Homeopathic <br/>
<a id="pl.175.22"></a><var>175.22</var>Pharmacopoeia of the United States, or official National Formulary, and supplement <br/>
<a id="pl.175.23"></a><var>175.23</var>to any of them;<br/>
<a id="pl.175.24"></a><var>175.24</var>    (ii) intended for use in the diagnosis, cure, mitigation, treatment, or prevention <br/>
<a id="pl.175.25"></a><var>175.25</var>of disease; or<br/>
<a id="pl.175.26"></a><var>175.26</var>    (iii) intended to affect the structure or any function of the body.<br/>
<a id="pl.175.27"></a><var>175.27</var>    (2) "Durable medical equipment" means equipment, including repair and <br/>
<a id="pl.175.28"></a><var>175.28</var>replacement parts, but not including mobility enhancing equipment, that:<br/>
<a id="pl.175.29"></a><var>175.29</var>    (i) can withstand repeated use;<br/>
<a id="pl.175.30"></a><var>175.30</var>    (ii) is primarily and customarily used to serve a medical purpose;<br/>
<a id="pl.175.31"></a><var>175.31</var>    (iii) generally is not useful to a person in the absence of illness or injury; and<br/>
<a id="pl.175.32"></a><var>175.32</var>    (iv) is not worn in or on the body.<br/>
<a id="pl.175.33"></a><var>175.33</var>    (3) "Mobility enhancing equipment" means equipment, including repair and <br/>
<a id="pl.175.34"></a><var>175.34</var>replacement parts, but not including durable medical equipment, that:<br/>
<a id="pl.176.1"></a><var>176.1</var>    (i) is primarily and customarily used to provide or increase the ability to move from <br/>
<a id="pl.176.2"></a><var>176.2</var>one place to another and that is appropriate for use either in a home or a motor vehicle;<br/>
<a id="pl.176.3"></a><var>176.3</var>    (ii) is not generally used by persons with normal mobility; and<br/>
<a id="pl.176.4"></a><var>176.4</var>    (iii) does not include any motor vehicle or equipment on a motor vehicle normally <br/>
<a id="pl.176.5"></a><var>176.5</var>provided by a motor vehicle manufacturer.<br/>
<a id="pl.176.6"></a><var>176.6</var>    (4) "Over-the-counter drug" means a drug that contains a label that identifies the <br/>
<a id="pl.176.7"></a><var>176.7</var>product as a drug as required by Code of Federal Regulations, title 21, section 
         <statute_ref>201.66</statute_ref>. The <br/>
<a id="pl.176.8"></a><var>176.8</var>label must include a "drug facts" panel or a statement of the active ingredients with a list of <br/>
<a id="pl.176.9"></a><var>176.9</var>those ingredients contained in the compound, substance, or preparation. Over-the-counter <br/>
<a id="pl.176.10"></a><var>176.10</var>drugs do not include grooming and hygiene products, regardless of whether they otherwise <br/>
<a id="pl.176.11"></a><var>176.11</var>meet the definition. "Grooming and hygiene products" are soaps, cleaning solutions, <br/>
<a id="pl.176.12"></a><var>176.12</var>shampoo, toothpaste, mouthwash, antiperspirants, and suntan lotions and sunscreens.<br/>
<a id="pl.176.13"></a><var>176.13</var>    (5) "Prescribed" and "prescription" means a direction in the form of an order, <br/>
<a id="pl.176.14"></a><var>176.14</var>formula, or recipe issued in any form of oral, written, electronic, or other means of <br/>
<a id="pl.176.15"></a><var>176.15</var>transmission by a duly licensed health care professional.<br/>
<a id="pl.176.16"></a><var>176.16</var>    (6) "Prosthetic device" means a replacement, corrective, or supportive device, <br/>
<a id="pl.176.17"></a><var>176.17</var>including repair and replacement parts, worn on or in the body to:<br/>
<a id="pl.176.18"></a><var>176.18</var>    (i) artificially replace a missing portion of the body;<br/>
<a id="pl.176.19"></a><var>176.19</var>    (ii) prevent or correct physical deformity or malfunction; or<br/>
<a id="pl.176.20"></a><var>176.20</var>    (iii) support a weak or deformed portion of the body.<br/>
<a id="pl.176.21"></a><var>176.21</var>Prosthetic device does not include corrective eyeglasses.<br/>
<a id="pl.176.22"></a><var>176.22</var>    (7) "Kidney dialysis equipment" means equipment that:<br/>
<a id="pl.176.23"></a><var>176.23</var>    (i) is used to remove waste products that build up in the blood when the kidneys are <br/>
<a id="pl.176.24"></a><var>176.24</var>not able to do so on their own; and<br/>
<a id="pl.176.25"></a><var>176.25</var>    (ii) can withstand repeated use, including multiple use by a single patient. <br/>
<a id="pl.176.26"></a><var>176.26</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.12.27.0"></a><a id="pl.176.27"></a><var>176.27</var>    Sec. 27. Minnesota Statutes 2006, section 297A.67, subdivision 8, is amended to read:<br/>
<a id="pl.176.28"></a><var>176.28</var>    Subd. 8. <b>Clothing.</b> (a) Clothing is exempt. For purposes of this subdivision, <br/>
<a id="pl.176.29"></a><var>176.29</var>"clothing" means all human wearing apparel suitable for general use.<br/>
<a id="pl.176.30"></a><var>176.30</var>    (b) Clothing includes, but is not limited to, aprons, household and shop; athletic <br/>
<a id="pl.176.31"></a><var>176.31</var>supporters; baby receiving blankets; bathing suits and caps; beach capes and coats; belts <br/>
<a id="pl.176.32"></a><var>176.32</var>and suspenders; boots; coats and jackets; costumes; children and adult diapers, including <br/>
<a id="pl.176.33"></a><var>176.33</var>disposable; ear muffs; footlets; formal wear; garters and garter belts; girdles; gloves and <br/>
<a id="pl.176.34"></a><var>176.34</var>mittens for general use; hats and caps; hosiery; insoles for shoes; lab coats; neckties; <br/>
<a id="pl.177.1"></a><var>177.1</var>overshoes; pantyhose; rainwear; rubber pants; sandals; scarves; shoes and shoe laces; <br/>
<a id="pl.177.2"></a><var>177.2</var>slippers; sneakers; socks and stockings; steel-toed boots; underwear; uniforms, athletic <br/>
<a id="pl.177.3"></a><var>177.3</var>and nonathletic; and wedding apparel.<br/>
<a id="pl.177.4"></a><var>177.4</var>    (c) Clothing does not include the following:<br/>
<a id="pl.177.5"></a><var>177.5</var>    (1) belt buckles sold separately;<br/>
<a id="pl.177.6"></a><var>177.6</var>    (2) costume masks sold separately;<br/>
<a id="pl.177.7"></a><var>177.7</var>    (3) patches and emblems sold separately;<br/>
<a id="pl.177.8"></a><var>177.8</var>    (4) sewing equipment and supplies, including but not limited to, knitting needles, <br/>
<a id="pl.177.9"></a><var>177.9</var>patterns, pins, scissors, sewing machines, sewing needles, tape measures, and thimbles;<br/>
<a id="pl.177.10"></a><var>177.10</var>    (5) sewing materials that become part of clothing, including but not limited to, <br/>
<a id="pl.177.11"></a><var>177.11</var>buttons, fabric, lace, thread, yarn, and zippers;<br/>
<a id="pl.177.12"></a><var>177.12</var>    (6) clothing accessories or equipment;<br/>
<a id="pl.177.13"></a><var>177.13</var>    (7) sports or recreational equipment; and<br/>
<a id="pl.177.14"></a><var>177.14</var>    (8) protective equipment.<br/>
<a id="pl.177.15"></a><var>177.15</var>Clothing also does not include apparel made from fur if a uniform definition of "apparel <br/>
<a id="pl.177.16"></a><var>177.16</var>made from fur" is developed by the member states of the Streamlined Sales and Use Tax <br/>
<a id="pl.177.17"></a><var>177.17</var>Agreement "fur clothing" as defined in section 297A.61, subdivision 46.<br/>
<a id="pl.177.18"></a><var>177.18</var>    For purposes of this subdivision, "clothing accessories or equipment" means <br/>
<a id="pl.177.19"></a><var>177.19</var>incidental items worn on the person or in conjunction with clothing. Clothing accessories <br/>
<a id="pl.177.20"></a><var>177.20</var>and equipment include, but are not limited to, briefcases; cosmetics; hair notions, including <br/>
<a id="pl.177.21"></a><var>177.21</var>barrettes, hair bows, and hairnets; handbags; handkerchiefs; jewelry; nonprescription <br/>
<a id="pl.177.22"></a><var>177.22</var>sunglasses; umbrellas; wallets; watches; and wigs and hairpieces. "Sports or recreational <br/>
<a id="pl.177.23"></a><var>177.23</var>equipment" means items designed for human use and worn in conjunction with an athletic <br/>
<a id="pl.177.24"></a><var>177.24</var>or recreational activity that are not suitable for general use. Sports and recreational <br/>
<a id="pl.177.25"></a><var>177.25</var>equipment includes, but is not limited to, ballet and tap shoes; cleated or spiked athletic <br/>
<a id="pl.177.26"></a><var>177.26</var>shoes; gloves, including, but not limited to, baseball, bowling, boxing, hockey, and golf <br/>
<a id="pl.177.27"></a><var>177.27</var>gloves; goggles; hand and elbow guards; life preservers and vests; mouth guards; roller <br/>
<a id="pl.177.28"></a><var>177.28</var>and ice skates; shin guards; shoulder pads; ski boots; waders; and wetsuits and fins. <br/>
<a id="pl.177.29"></a><var>177.29</var>"Protective equipment" means items for human wear and designed as protection of the <br/>
<a id="pl.177.30"></a><var>177.30</var>wearer against injury or disease or as protection against damage or injury of other persons <br/>
<a id="pl.177.31"></a><var>177.31</var>or property but not suitable for general use. Protective equipment includes, but is not <br/>
<a id="pl.177.32"></a><var>177.32</var>limited to, breathing masks; clean room apparel and equipment; ear and hearing protectors; <br/>
<a id="pl.177.33"></a><var>177.33</var>face shields; finger guards; hard hats; helmets; paint or dust respirators; protective gloves; <br/>
<a id="pl.177.34"></a><var>177.34</var>safety glasses and goggles; safety belts; tool belts; and welders gloves and masks.<br/>
<a id="pl.178.1"></a><var>178.1</var><b>EFFECTIVE DATE.</b>This section is effective for sales and purchases made after <br/>
<a id="pl.178.2"></a><var>178.2</var>June 30, 2008.<br/>
<br/>
<a id="bill.12.28.0"></a><a id="pl.178.3"></a><var>178.3</var>    Sec. 28. Minnesota Statutes 2006, section 297A.67, subdivision 9, is amended to read:<br/>
<a id="pl.178.4"></a><var>178.4</var>    Subd. 9. <b>Baby products.</b> Breast pumps, baby bottles and nipples, pacifiers, teething <br/>
<a id="pl.178.5"></a><var>178.5</var>rings, and infant syringes are exempt.<br/>
<a id="pl.178.6"></a><var>178.6</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.12.29.0"></a><a id="pl.178.7"></a><var>178.7</var>    Sec. 29. Minnesota Statutes 2006, section 297A.68, subdivision 11, is amended to read:<br/>
<a id="pl.178.8"></a><var>178.8</var>    Subd. 11. <b>Advertising materials.</b> Materials designed to advertise and promote the <br/>
<a id="pl.178.9"></a><var>178.9</var>sale of merchandise or services are exempt if these materials are mailed or transferred to a <br/>
<a id="pl.178.10"></a><var>178.10</var>person outside the state for use solely outside the state. Mailing and reply envelopes and <br/>
<a id="pl.178.11"></a><var>178.11</var>cards and other shipping materials including, but not limited to, boxes, labels, containers, <br/>
<a id="pl.178.12"></a><var>178.12</var>and banding, used exclusively in connection with these advertising and promotional <br/>
<a id="pl.178.13"></a><var>178.13</var>materials are included in this exemption. The exemption applies regardless of where the <br/>
<a id="pl.178.14"></a><var>178.14</var>mailing occurs. The storage of these materials in the state for the purpose of subsequently <br/>
<a id="pl.178.15"></a><var>178.15</var>shipping or otherwise transferring the material out of state is also exempt if the other <br/>
<a id="pl.178.16"></a><var>178.16</var>conditions in this subdivision are met. For purposes of this subdivision, materials that have <br/>
<a id="pl.178.17"></a><var>178.17</var>a primary purpose other than advertising, such as fulfilling a legal obligation or furnishing <br/>
<a id="pl.178.18"></a><var>178.18</var>nonadvertising information, are not materials designed to advertise and promote the sale <br/>
<a id="pl.178.19"></a><var>178.19</var>of merchandise or services even if they do include advertising content.<br/>
<a id="pl.178.20"></a><var>178.20</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.12.30.0"></a><a id="pl.178.21"></a><var>178.21</var>    Sec. 30. Minnesota Statutes 2006, section 297A.68, subdivision 16, is amended to read:<br/>
<a id="pl.178.22"></a><var>178.22</var>    Subd. 16. <b>Packing materials.</b> Packing materials used to pack and ship household <br/>
<a id="pl.178.23"></a><var>178.23</var>goods and that are provided to and remain with the customer of a for-hire carrier are <br/>
<a id="pl.178.24"></a><var>178.24</var>exempt if the ultimate destination of the goods is outside Minnesota and if the goods <br/>
<a id="pl.178.25"></a><var>178.25</var>packing materials are not later returned to a point within Minnesota, except in the course <br/>
<a id="pl.178.26"></a><var>178.26</var>of interstate commerce. This exemption does not apply to tools, equipment, pads, or <br/>
<a id="pl.178.27"></a><var>178.27</var>accessories owned or leased by the for-hire carrier.<br/>
<a id="pl.178.28"></a><var>178.28</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.178.29"></a><var>178.29</var>after December 31, 2007.<br/>
<br/>
<a id="bill.12.31.0"></a><a id="pl.178.30"></a><var>178.30</var>    Sec. 31. Minnesota Statutes 2006, section 297A.68, subdivision 35, is amended to read:<br/>
<a id="pl.179.1"></a><var>179.1</var>    Subd. 35. <b>Telecommunications</b><b>, cable television, and direct satellite</b><b> equipment.</b><br/>
<a id="pl.179.2"></a><var>179.2</var>    (a) Telecommunications, cable television, or direct satellite machinery and equipment <br/>
<a id="pl.179.3"></a><var>179.3</var>purchased or leased for use directly by a telecommunications, cable television, or <br/>
<a id="pl.179.4"></a><var>179.4</var>direct satellite service provider primarily in the provision of telecommunications, cable <br/>
<a id="pl.179.5"></a><var>179.5</var>television, or direct satellite services that are ultimately to be sold at retail are exempt, <br/>
<a id="pl.179.6"></a><var>179.6</var>regardless of whether purchased by the owner, a contractor, or a subcontractor.<br/>
<a id="pl.179.7"></a><var>179.7</var>    (b) For purposes of this subdivision, "telecommunications, cable television, or direct <br/>
<a id="pl.179.8"></a><var>179.8</var>satellite machinery and equipment" includes, but is not limited to:<br/>
<a id="pl.179.9"></a><var>179.9</var>    (1) machinery, equipment, and fixtures utilized in receiving, initiating, <br/>
<a id="pl.179.10"></a><var>179.10</var>amplifying, processing, transmitting, retransmitting, recording, switching, or monitoring <br/>
<a id="pl.179.11"></a><var>179.11</var>telecommunications, cable television, or direct satellite services, such as computers, <br/>
<a id="pl.179.12"></a><var>179.12</var>transformers, amplifiers, routers, bridges, repeaters, multiplexers, and other items <br/>
<a id="pl.179.13"></a><var>179.13</var>performing comparable functions;<br/>
<a id="pl.179.14"></a><var>179.14</var>    (2) machinery, equipment, and fixtures used in the transportation of <br/>
<a id="pl.179.15"></a><var>179.15</var>telecommunications, cable television, or direct satellite services, radio transmitters and <br/>
<a id="pl.179.16"></a><var>179.16</var>receivers, satellite equipment, microwave equipment, and other transporting media, but <br/>
<a id="pl.179.17"></a><var>179.17</var>not wire, cable, fiber, poles, or conduit;<br/>
<a id="pl.179.18"></a><var>179.18</var>    (3) ancillary machinery, equipment, and fixtures that regulate, control, protect, or <br/>
<a id="pl.179.19"></a><var>179.19</var>enable the machinery in clauses (1) and (2) to accomplish its intended function, such as <br/>
<a id="pl.179.20"></a><var>179.20</var>auxiliary power supply, test equipment, towers, heating, ventilating, and air conditioning <br/>
<a id="pl.179.21"></a><var>179.21</var>equipment necessary to the operation of the telecommunications, cable television, or direct <br/>
<a id="pl.179.22"></a><var>179.22</var>satellite equipment; and software necessary to the operation of the telecommunications, <br/>
<a id="pl.179.23"></a><var>179.23</var>cable television, or direct satellite equipment; and<br/>
<a id="pl.179.24"></a><var>179.24</var>    (4) repair and replacement parts, including accessories, whether purchased as spare <br/>
<a id="pl.179.25"></a><var>179.25</var>parts, repair parts, or as upgrades or modifications to qualified machinery or equipment.<br/>
<a id="pl.179.26"></a><var>179.26</var>    (c) For purposes of this subdivision, "telecommunications services" means <br/>
<a id="pl.179.27"></a><var>179.27</var>telecommunications services as defined in section 
<statute_ref>297A.61, subdivision 24</statute_ref>, paragraphs <br/>
<a id="pl.179.28"></a><var>179.28</var>(a), (c), and (d).<br/>
<a id="pl.179.29"></a><var>179.29</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.179.30"></a><var>179.30</var>made after December 31, 2007.<br/>
<br/>
<a id="bill.12.32.0"></a><a id="pl.179.31"></a><var>179.31</var>    Sec. 32. Minnesota Statutes 2006, section 297A.69, subdivision 2, is amended to read:<br/>
<a id="pl.179.32"></a><var>179.32</var>    Subd. 2. <b>Materials consumed in agricultural production.</b> Materials stored, used, <br/>
<a id="pl.179.33"></a><var>179.33</var>or consumed in agricultural production of personal property intended to be sold ultimately <br/>
<a id="pl.179.34"></a><var>179.34</var>at retail are exempt, whether or not the item becomes an ingredient or constituent part <br/>
<a id="pl.180.1"></a><var>180.1</var>of the property produced. Materials that qualify for this exemption include, but are not <br/>
<a id="pl.180.2"></a><var>180.2</var>limited to, the following:<br/>
<a id="pl.180.3"></a><var>180.3</var>    (1) feeds, seeds, trees, fertilizers, and herbicides, including when purchased for use <br/>
<a id="pl.180.4"></a><var>180.4</var>by farmers in a federal or state farm or conservation program;<br/>
<a id="pl.180.5"></a><var>180.5</var>    (2) materials sold to a veterinarian to be used or consumed in the care, medication, <br/>
<a id="pl.180.6"></a><var>180.6</var>and treatment of agricultural production animals and horses;<br/>
<a id="pl.180.7"></a><var>180.7</var>    (3) chemicals, including chemicals used for cleaning food processing machinery <br/>
<a id="pl.180.8"></a><var>180.8</var>and equipment;<br/>
<a id="pl.180.9"></a><var>180.9</var>    (4) materials, including chemicals, fuels, and electricity purchased by persons <br/>
<a id="pl.180.10"></a><var>180.10</var>engaged in agricultural production to treat waste generated as a result of the production <br/>
<a id="pl.180.11"></a><var>180.11</var>process;<br/>
<a id="pl.180.12"></a><var>180.12</var>    (5) fuels, electricity, gas, and steam used or consumed in the production process, <br/>
<a id="pl.180.13"></a><var>180.13</var>except that including electricity, gas, or steam used for space heating, cooling, or lighting <br/>
<a id="pl.180.14"></a><var>180.14</var>is exempt if (i) it is in excess of the average climate control or lighting for the production <br/>
<a id="pl.180.15"></a><var>180.15</var>area, and (ii) it is necessary to produce that particular product of facilities housing <br/>
<a id="pl.180.16"></a><var>180.16</var>agricultural animals;<br/>
<a id="pl.180.17"></a><var>180.17</var>    (6) petroleum products and lubricants;<br/>
<a id="pl.180.18"></a><var>180.18</var>    (7) packaging materials, including returnable containers used in packaging food and <br/>
<a id="pl.180.19"></a><var>180.19</var>beverage products; and<br/>
<a id="pl.180.20"></a><var>180.20</var>    (8) accessory tools and equipment that are separate detachable units with an ordinary <br/>
<a id="pl.180.21"></a><var>180.21</var>useful life of less than 12 months used in producing a direct effect upon the product.<br/>
<a id="pl.180.22"></a><var>180.22</var>Machinery, equipment, implements, tools, accessories, appliances, contrivances, and <br/>
<a id="pl.180.23"></a><var>180.23</var>furniture and fixtures, except those listed in this clause are not included within this <br/>
<a id="pl.180.24"></a><var>180.24</var>exemption.<br/>
<a id="pl.180.25"></a><var>180.25</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.12.33.0"></a><a id="pl.180.26"></a><var>180.26</var>    Sec. 33. Minnesota Statutes 2006, section 297A.70, subdivision 7, is amended to read:<br/>
<a id="pl.180.27"></a><var>180.27</var>    Subd. 7. <b>Hospitals and outpatient surgical centers.</b> (a) Sales, except for those <br/>
<a id="pl.180.28"></a><var>180.28</var>listed in paragraph (c), to a hospital are exempt, if the items purchased are used in <br/>
<a id="pl.180.29"></a><var>180.29</var>providing hospital services. For purposes of this subdivision, "hospital" means a hospital <br/>
<a id="pl.180.30"></a><var>180.30</var>organized and operated for charitable purposes within the meaning of section 501(c)(3) of <br/>
<a id="pl.180.31"></a><var>180.31</var>the Internal Revenue Code, and licensed under chapter 144 or by any other jurisdiction, <br/>
<a id="pl.180.32"></a><var>180.32</var>and "hospital services" are services authorized or required to be performed by a "hospital" <br/>
<a id="pl.180.33"></a><var>180.33</var>under chapter 144.<br/>
<a id="pl.181.1"></a><var>181.1</var>    (b) Sales, except for those listed in paragraph (c), to an outpatient surgical center <br/>
<a id="pl.181.2"></a><var>181.2</var>are exempt, if the items purchased are used in providing outpatient surgical services. For <br/>
<a id="pl.181.3"></a><var>181.3</var>purposes of this subdivision, "outpatient surgical center" means an outpatient surgical <br/>
<a id="pl.181.4"></a><var>181.4</var>center organized and operated for charitable purposes within the meaning of section <br/>
<a id="pl.181.5"></a><var>181.5</var>501(c)(3) of the Internal Revenue Code, and licensed under chapter 144 or by any other <br/>
<a id="pl.181.6"></a><var>181.6</var>jurisdiction. For the purposes of this subdivision, "outpatient surgical services" means: <br/>
<a id="pl.181.7"></a><var>181.7</var>(1) services authorized or required to be performed by an outpatient surgical center under <br/>
<a id="pl.181.8"></a><var>181.8</var>chapter 144; and (2) urgent care. For purposes of this subdivision, "urgent care" means <br/>
<a id="pl.181.9"></a><var>181.9</var>health services furnished to a person whose medical condition is sufficiently acute to <br/>
<a id="pl.181.10"></a><var>181.10</var>require treatment unavailable through, or inappropriate to be provided by, a clinic or <br/>
<a id="pl.181.11"></a><var>181.11</var>physician's office, but not so acute as to require treatment in a hospital emergency room.<br/>
<a id="pl.181.12"></a><var>181.12</var>    (c) This exemption does not apply to the following products and services:<br/>
<a id="pl.181.13"></a><var>181.13</var>    (1) purchases made by a clinic, physician's office, or any other medical facility not <br/>
<a id="pl.181.14"></a><var>181.14</var>operating as a hospital or outpatient surgical center, even though the clinic, office, or <br/>
<a id="pl.181.15"></a><var>181.15</var>facility may be owned and operated by a hospital or outpatient surgical center;<br/>
<a id="pl.181.16"></a><var>181.16</var>    (2) sales under section 
         <statute_ref>297A.61, subdivision 3</statute_ref>, paragraph (g), clause (2), and <br/>
<a id="pl.181.17"></a><var>181.17</var>prepared food, candy, and soft drinks; <br/>
<a id="pl.181.18"></a><var>181.18</var>    (3) building and construction materials used in constructing buildings or facilities <br/>
<a id="pl.181.19"></a><var>181.19</var>that will not be used principally by the hospital or outpatient surgical center;<br/>
<a id="pl.181.20"></a><var>181.20</var>    (4) building, construction, or reconstruction materials purchased by a contractor <br/>
<a id="pl.181.21"></a><var>181.21</var>or a subcontractor as a part of a lump-sum contract or similar type of contract with a <br/>
<a id="pl.181.22"></a><var>181.22</var>guaranteed maximum price covering both labor and materials for use in the construction, <br/>
<a id="pl.181.23"></a><var>181.23</var>alteration, or repair of a hospital or outpatient surgical center; or<br/>
<a id="pl.181.24"></a><var>181.24</var>    (5) the leasing of a motor vehicle as defined in section 
         <statute_ref>297B.01, subdivision 5</statute_ref>. <br/>
<a id="pl.181.25"></a><var>181.25</var>    (d) A limited liability company also qualifies for exemption under this subdivision if <br/>
<a id="pl.181.26"></a><var>181.26</var>(1) it consists of a sole member that would qualify for the exemption, and (2) the items <br/>
<a id="pl.181.27"></a><var>181.27</var>purchased qualify for the exemption.<br/>
<a id="pl.181.28"></a><var>181.28</var>    (e) An entity that contains both a hospital and a nonprofit unit may claim this <br/>
<a id="pl.181.29"></a><var>181.29</var>exemption on purchases made for both the hospital and nonprofit unit provided that:<br/>
<a id="pl.181.30"></a><var>181.30</var>    (1) the nonprofit unit would have qualified for exemption under subdivision 4; and<br/>
<a id="pl.181.31"></a><var>181.31</var>    (2) the items purchased would have qualified for the exemption.<br/>
<a id="pl.181.32"></a><var>181.32</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.12.34.0"></a><a id="pl.181.33"></a><var>181.33</var>    Sec. 34. Minnesota Statutes 2006, section 297A.70, is amended by adding a <br/>
<a id="pl.181.34"></a><var>181.34</var>subdivision to read:<br/>
<a id="pl.182.1"></a><var>182.1</var>    Subd. 18. <b>Private communication service for State Lottery.</b> Private <br/>
<a id="pl.182.2"></a><var>182.2</var>communication service, as defined in section 297A.61, subdivision 26, is exempt if the <br/>
<a id="pl.182.3"></a><var>182.3</var>service is purchased by an agent acting on behalf of the State Lottery.<br/>
<a id="pl.182.4"></a><var>182.4</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for sales and purchases <br/>
<a id="pl.182.5"></a><var>182.5</var>made after December 31, 2007.<br/>
<br/>
<a id="bill.12.35.0"></a><a id="pl.182.6"></a><var>182.6</var>    Sec. 35. Minnesota Statutes 2006, section 297A.72, is amended to read:<br/>
<a id="pl.182.7"></a><var>182.7</var><b>297A.72 EXEMPTION CERTIFICATES.</b><br/>
<a id="pl.182.8"></a><var>182.8</var>    Subd. 2. <b>Content and form of exemption certificate.</b> An exemption certificate <br/>
<a id="pl.182.9"></a><var>182.9</var>must be substantially in the form prescribed by the commissioner and. To be fully <br/>
<a id="pl.182.10"></a><var>182.10</var>completed, the exemption certificate must:<br/>
<a id="pl.182.11"></a><var>182.11</var>    (1) either be signed by the purchaser if it is a paper form, or meet the requirements <br/>
<a id="pl.182.12"></a><var>182.12</var>of section 
         <statute_ref>270C.304</statute_ref> if in electronic form;<br/>
<a id="pl.182.13"></a><var>182.13</var>    (2) bear the name and address of the purchaser; and<br/>
<a id="pl.182.14"></a><var>182.14</var>    (3) indicate the sales tax account identification number, if any, issued to the <br/>
<a id="pl.182.15"></a><var>182.15</var>purchaser. as follows:<br/>
<a id="pl.182.16"></a><var>182.16</var>    (i) the purchaser's Minnesota tax identification number;<br/>
<a id="pl.182.17"></a><var>182.17</var>    (ii) if the purchaser does not have a Minnesota tax identification number, then the <br/>
<a id="pl.182.18"></a><var>182.18</var>purchaser's state tax identification number that is issued by a state other than Minnesota, <br/>
<a id="pl.182.19"></a><var>182.19</var>and the name of that state;<br/>
<a id="pl.182.20"></a><var>182.20</var>    (iii) if the purchaser does not have an identification number described in either item <br/>
<a id="pl.182.21"></a><var>182.21</var>(i) or (ii), then the purchaser's federal Employer Identification Number; or<br/>
<a id="pl.182.22"></a><var>182.22</var>    (iv) if the purchaser does not have an identification number described in item (i), (ii), <br/>
<a id="pl.182.23"></a><var>182.23</var>or (iii), then either the number of the purchaser's state-issued driver's license, if valid in <br/>
<a id="pl.182.24"></a><var>182.24</var>the state of issue, or if the purchaser does not have a driver's license, a valid state-issued <br/>
<a id="pl.182.25"></a><var>182.25</var>identification number, and the name of the state of issue;<br/>
<a id="pl.182.26"></a><var>182.26</var>    (4) indicate the purchaser's type of business, using a business-type coding system <br/>
<a id="pl.182.27"></a><var>182.27</var>prescribed by the commissioner; and<br/>
<a id="pl.182.28"></a><var>182.28</var>    (5) indicate the reason for the exemption, using an exemption reason coding system <br/>
<a id="pl.182.29"></a><var>182.29</var>prescribed by the commissioner.<br/>
<a id="pl.182.30"></a><var>182.30</var>    Subd. 3. <b>Purchaser requirement.</b> A blanket exemption certificate is an exemption <br/>
<a id="pl.182.31"></a><var>182.31</var>certificate used for continuing future purchases. A purchaser using a blanket exemption <br/>
<a id="pl.182.32"></a><var>182.32</var>certificate must update it as needed to accurately reflect the information that is required <br/>
<a id="pl.182.33"></a><var>182.33</var>under subdivision 2.<br/>
<a id="pl.182.34"></a><var>182.34</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.12.36.0"></a><a id="pl.183.1"></a><var>183.1</var>    Sec. 36. <b>[297A.8155] LIQUOR REPORTING REQUIREMENTS; PENALTY.</b><br/>
<a id="pl.183.2"></a><var>183.2</var>    A person who sells liquor, as defined in section 295.75, subdivision 1, in Minnesota <br/>
<a id="pl.183.3"></a><var>183.3</var>to a retailer that sells liquor, shall file with the commissioner an annual informational <br/>
<a id="pl.183.4"></a><var>183.4</var>report, in the form and manner prescribed by the commissioner, indicating the name, <br/>
<a id="pl.183.5"></a><var>183.5</var>address, and Minnesota business identification number of each retailer, and the total dollar <br/>
<a id="pl.183.6"></a><var>183.6</var>amount of liquor sold to each retailer in the previous calendar year. The report must be <br/>
<a id="pl.183.7"></a><var>183.7</var>filed on or before March 31 following the close of the calendar year. A person failing to file <br/>
<a id="pl.183.8"></a><var>183.8</var>this report is subject to the penalty imposed under Minnesota Statutes, section 289A.60.<br/>
<a id="pl.183.9"></a><var>183.9</var><b>EFFECTIVE DATE.</b>This section is effective for reports filed after December <br/>
<a id="pl.183.10"></a><var>183.10</var>31, 2008.<br/>
<br/>
<a id="bill.12.37.0"></a><a id="pl.183.11"></a><var>183.11</var>    Sec. 37. Minnesota Statutes 2006, section 297A.90, subdivision 2, is amended to read:<br/>
<a id="pl.183.12"></a><var>183.12</var>    Subd. 2. <b>Payment of tax.</b> (a) Persons who are registered as retailers may make <br/>
<a id="pl.183.13"></a><var>183.13</var>purchases in this state or import property into this state without payment of the sales or use <br/>
<a id="pl.183.14"></a><var>183.14</var>taxes imposed by this chapter at the time of purchase or importation, if the purchases or <br/>
<a id="pl.183.15"></a><var>183.15</var>importations come within the provisions of this section and are made in strict compliance <br/>
<a id="pl.183.16"></a><var>183.16</var>with the rules of the commissioner.<br/>
<a id="pl.183.17"></a><var>183.17</var>    (b) A person described in subdivision 1 may elect to pay directly to the commissioner <br/>
<a id="pl.183.18"></a><var>183.18</var>any sales or use tax that may be due under this chapter for the acquisition of mobile <br/>
<a id="pl.183.19"></a><var>183.19</var>transportation equipment and parts and accessories attached or to be attached to such <br/>
<a id="pl.183.20"></a><var>183.20</var>equipment registered under section 
         <statute_ref>168.187</statute_ref>. <br/>
<a id="pl.183.21"></a><var>183.21</var>    (c) The total cost of such equipment and parts and accessories attached or to be <br/>
<a id="pl.183.22"></a><var>183.22</var>attached to such equipment must be multiplied by a fraction. The numerator of the fraction <br/>
<a id="pl.183.23"></a><var>183.23</var>is the Minnesota mileage as reported on the current pro rata application provided for in <br/>
<a id="pl.183.24"></a><var>183.24</var>section 
         <statute_ref>168.187</statute_ref> and the denominator of the fraction is the total mileage reported on the <br/>
<a id="pl.183.25"></a><var>183.25</var>current pro rata registration application. The amount so determined must be multiplied by <br/>
<a id="pl.183.26"></a><var>183.26</var>the tax rate to obtain the tax due. <br/>
<a id="pl.183.27"></a><var>183.27</var>In computing the tax under this section "sales price" does not include the amount of any <br/>
<a id="pl.183.28"></a><var>183.28</var>tax, except any manufacturer's or importer's excise tax, imposed by the United States <br/>
<a id="pl.183.29"></a><var>183.29</var>upon or with respect to retail sales, whether taxes imposed directly on the retailer or the <br/>
<a id="pl.183.30"></a><var>183.30</var>consumer that are separately stated on the invoice, bill of sale, or similar document given <br/>
<a id="pl.183.31"></a><var>183.31</var>to the purchaser.<br/>
<a id="pl.183.32"></a><var>183.32</var>    (d) A retailer covered by this section shall make a return and remit to the <br/>
<a id="pl.183.33"></a><var>183.33</var>commissioner the tax due for the preceding calendar month in accordance with sections <br/>
<statute_ref><a id="pl.183.34"></a><var>183.34</var>289A.11
         </statute_ref> and 
         <statute_ref>289A.20, subdivision 4</statute_ref>. <br/>
<a id="pl.184.1"></a><var>184.1</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.12.38.0"></a><a id="pl.184.2"></a><var>184.2</var>    Sec. 38. Minnesota Statutes 2006, section 297B.035, subdivision 1, is amended to read:<br/>
<a id="pl.184.3"></a><var>184.3</var>    Subdivision 1. <b>Ordinary course of business.</b> Except as provided in this section, <br/>
<a id="pl.184.4"></a><var>184.4</var>motor vehicles purchased solely for resale in the ordinary course of business by any motor <br/>
<a id="pl.184.5"></a><var>184.5</var>vehicle dealer, as defined in section 
         <statute_ref>168.011, subdivision 21</statute_ref>, who is licensed under section <br/>
<statute_ref><a id="pl.184.6"></a><var>184.6</var>168.27, subdivision 2
         </statute_ref> or 3, including vehicles which bear dealer plates as authorized by <br/>
<a id="pl.184.7"></a><var>184.7</var>section 
         <statute_ref>168.27, subdivision 16</statute_ref>, shall be exempt from the provisions of this chapter. <br/>
<a id="pl.184.8"></a><var>184.8</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.12.39.0"></a><a id="pl.184.9"></a><var>184.9</var>    Sec. 39. Minnesota Statutes 2006, section 469.1734, subdivision 6, is amended to read:<br/>
<a id="pl.184.10"></a><var>184.10</var>    Subd. 6. <b>Sales tax exemption; equipment; construction materials.</b> (a) The gross <br/>
<a id="pl.184.11"></a><var>184.11</var>receipts from the sale of machinery and equipment and repair parts are exempt from <br/>
<a id="pl.184.12"></a><var>184.12</var>taxation under chapter 297A, if the machinery and equipment:<br/>
<a id="pl.184.13"></a><var>184.13</var>    (1) are used in connection with a trade or business;<br/>
<a id="pl.184.14"></a><var>184.14</var>    (2) are placed in service in a city that is authorized to designate a zone under section <br/>
<statute_ref><a id="pl.184.15"></a><var>184.15</var>469.1731
         </statute_ref>, regardless of whether the machinery and equipment are used in a zone; and<br/>
<a id="pl.184.16"></a><var>184.16</var>    (3) have a useful life of 12 months or more.<br/>
<a id="pl.184.17"></a><var>184.17</var>    (b) The gross receipts from the sale of construction materials are exempt, if they are <br/>
<a id="pl.184.18"></a><var>184.18</var>used to construct:<br/>
<a id="pl.184.19"></a><var>184.19</var>    (1) a facility for use in a trade or business located in a city that is authorized to <br/>
<a id="pl.184.20"></a><var>184.20</var>designate a zone under section 
         <statute_ref>469.1731</statute_ref>, regardless of whether the facility is located in a <br/>
<a id="pl.184.21"></a><var>184.21</var>zone; or<br/>
<a id="pl.184.22"></a><var>184.22</var>    (2) housing that is located in a zone.<br/>
<a id="pl.184.23"></a><var>184.23</var>The exemptions under this paragraph apply regardless of whether the purchase is made by <br/>
<a id="pl.184.24"></a><var>184.24</var>the owner, the user, or a contractor.<br/>
<a id="pl.184.25"></a><var>184.25</var>    (c) A purchaser may claim an exemption under this subdivision for tax on the <br/>
<a id="pl.184.26"></a><var>184.26</var>purchases up to, but not exceeding:<br/>
<a id="pl.184.27"></a><var>184.27</var>    (1) the amount of the tax credit certificates received from the city, less<br/>
<a id="pl.184.28"></a><var>184.28</var>    (2) any tax credit certificates used under the provisions of subdivisions 4 and 5, and <br/>
<a id="pl.184.29"></a><var>184.29</var>section 
         <statute_ref>469.1732, subdivision 2</statute_ref>.<br/>
<a id="pl.184.30"></a><var>184.30</var>    (d) The tax on sales of items exempted under this subdivision shall be imposed and <br/>
<a id="pl.184.31"></a><var>184.31</var>collected as if the applicable rate under section 
         <statute_ref>297A.62</statute_ref> applied. Upon application by the <br/>
<a id="pl.184.32"></a><var>184.32</var>purchaser, on forms prescribed by the commissioner, a refund equal to the tax paid shall <br/>
<a id="pl.184.33"></a><var>184.33</var>be paid to the purchaser. The application must include sufficient information to permit <br/>
<a id="pl.185.1"></a><var>185.1</var>the commissioner to verify the sales tax paid and the eligibility of the claimant to receive <br/>
<a id="pl.185.2"></a><var>185.2</var>the credit. No more than two applications for refunds may be filed under this subdivision <br/>
<a id="pl.185.3"></a><var>185.3</var>in a calendar year. The provisions of section 
         <statute_ref>289A.40</statute_ref> apply to the refunds payable <br/>
<a id="pl.185.4"></a><var>185.4</var>under this subdivision. There is annually appropriated to the commissioner of revenue <br/>
<a id="pl.185.5"></a><var>185.5</var>the amount required to make the refunds, which must be deducted from the amount of <br/>
<a id="pl.185.6"></a><var>185.6</var>the city's allocation under section 
         <statute_ref>469.169, subdivision 12</statute_ref>, that remains available and its <br/>
<a id="pl.185.7"></a><var>185.7</var>limitation under section 
         <statute_ref>469.1735</statute_ref>. <br/>
<a id="pl.185.8"></a><var>185.8</var>    (e) The amount to be refunded shall bear interest at the rate in section 
         <statute_ref>270C.405</statute_ref> <br/>
<a id="pl.185.9"></a><var>185.9</var>from the date 90 days after the refund claim is filed with the commissioner.<br/>
<a id="pl.185.10"></a><var>185.10</var><b>EFFECTIVE DATE.</b>This section is effective for refund claims filed after June <br/>
<a id="pl.185.11"></a><var>185.11</var>30, 2008.<br/>
<br/>
<a id="bill.12.40.0"></a><a id="pl.185.12"></a><var>185.12</var>    Sec. 40. <b>FUR TAX PAYMENTS.</b><br/>
<a id="pl.185.13"></a><var>185.13</var>    (a) Furriers must file the annual return, required by Minnesota Statutes, section <br/>
<a id="pl.185.14"></a><var>185.14</var>295.60, subdivision 5, which otherwise would be due March 15, 2009, by September <br/>
<a id="pl.185.15"></a><var>185.15</var>15, 2008.<br/>
<a id="pl.185.16"></a><var>185.16</var>    (b) If a furrier is required by Minnesota Statutes, section 295.60, subdivision 3, to <br/>
<a id="pl.185.17"></a><var>185.17</var>make installments of quarterly estimates, then the furrier shall make the last installment by <br/>
<a id="pl.185.18"></a><var>185.18</var>July 15, 2008.<br/>
<a id="pl.185.19"></a><var>185.19</var><b>EFFECTIVE DATE.</b>This section is effective July 1, 2008, for sales and purchases <br/>
<a id="pl.185.20"></a><var>185.20</var>made prior to July 1, 2008.<br/>
<br/>
<a id="bill.12.41.0"></a><a id="pl.185.21"></a><var>185.21</var>    Sec. 41. <b>REPEALER.</b><br/>
<a id="pl.185.22"></a><var>185.22</var>(a) Minnesota Statutes 2006, section 295.60, is repealed.<br/>
<a id="pl.185.23"></a><var>185.23</var>(b) Minnesota Statutes 2006, section 297A.61, subdivision 20, is repealed.<br/>
<a id="pl.185.24"></a><var>185.24</var>(c) Minnesota Statutes 2006, section 297A.668, subdivision 6, is repealed.<br/>
<a id="pl.185.25"></a><var>185.25</var>(d) Minnesota Statutes 2006, section 297A.67, subdivision 22, is repealed.<br/>
<a id="pl.185.26"></a><var>185.26</var><b>EFFECTIVE DATE.</b>Paragraph (a) of this section is effective for sales and <br/>
<a id="pl.185.27"></a><var>185.27</var>purchases made after June 30, 2008; paragraph (b) is effective retroactively for sales and <br/>
<a id="pl.185.28"></a><var>185.28</var>purchases made after December 31, 2007; and paragraphs (c) and (d) are effective the <br/>
<a id="pl.185.29"></a><var>185.29</var>day following final enactment.<br/>
<br/>
<a id="bill.13.0.0"></a>

<a id="bill.13.1.0"></a><a id="pl.186.3"></a><var>186.3</var>    Section 1. Minnesota Statutes 2006, section 270.071, subdivision 7, is amended to read:<br/>
<a id="pl.186.4"></a><var>186.4</var>    Subd. 7. <b>Flight property.</b> "Flight property" means all aircraft and flight equipment <br/>
<a id="pl.186.5"></a><var>186.5</var>used in connection therewith, including spare flight equipment. Flight property also <br/>
<a id="pl.186.6"></a><var>186.6</var>includes computers and computer software used in operating, controlling, or regulating <br/>
<a id="pl.186.7"></a><var>186.7</var>aircraft and flight equipment.<br/>
<a id="pl.186.8"></a><var>186.8</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.2.0"></a><a id="pl.186.9"></a><var>186.9</var>    Sec. 2. Minnesota Statutes 2006, section 270.072, subdivision 2, is amended to read:<br/>
<a id="pl.186.10"></a><var>186.10</var>    Subd. 2. <b>Assessment of flight property.</b> The Flight property of all that is owned <br/>
<a id="pl.186.11"></a><var>186.11</var>by, or is leased, loaned, or otherwise made available to an airline companies company <br/>
<a id="pl.186.12"></a><var>186.12</var>operating in Minnesota shall be assessed and appraised annually by the commissioner <br/>
<a id="pl.186.13"></a><var>186.13</var>with reference to its value on January 2 of the assessment year in the manner prescribed <br/>
<a id="pl.186.14"></a><var>186.14</var>by sections 
         <statute_ref>270.071</statute_ref> to 
         <statute_ref>270.079</statute_ref>. Aircraft with a gross weight of less than 30,000 pounds <br/>
<a id="pl.186.15"></a><var>186.15</var>and used on intermittent or irregularly timed flights shall be excluded from the provisions <br/>
<a id="pl.186.16"></a><var>186.16</var>of sections 
         <statute_ref>270.071</statute_ref> to 
         <statute_ref>270.079</statute_ref>. <br/>
<a id="pl.186.17"></a><var>186.17</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.3.0"></a><a id="pl.186.18"></a><var>186.18</var>    Sec. 3. Minnesota Statutes 2006, section 270.072, subdivision 3, is amended to read:<br/>
<a id="pl.186.19"></a><var>186.19</var>    Subd. 3. <b>Report by airline company.</b> Each year, on or before July 1, every airline <br/>
<a id="pl.186.20"></a><var>186.20</var>company engaged in air commerce in this state shall file with the commissioner on or <br/>
<a id="pl.186.21"></a><var>186.21</var>before the time fixed by the commissioner a report under oath setting forth specifically <br/>
<a id="pl.186.22"></a><var>186.22</var>the information prescribed by the commissioner to enable the commissioner to make the <br/>
<a id="pl.186.23"></a><var>186.23</var>assessment required in sections 
         <statute_ref>270.071</statute_ref> to 
         <statute_ref>270.079</statute_ref>, unless the commissioner determines <br/>
<a id="pl.186.24"></a><var>186.24</var>that the airline company or person should be excluded from filing because its activities do <br/>
<a id="pl.186.25"></a><var>186.25</var>not constitute air commerce as defined herein. A penalty of five percent of the tax being <br/>
<a id="pl.186.26"></a><var>186.26</var>assessed is imposed on a late filing of the annual report. If the report is not filed within <br/>
<a id="pl.186.27"></a><var>186.27</var>30 days, an additional penalty of five percent of the assessed tax is imposed for each <br/>
<a id="pl.186.28"></a><var>186.28</var>additional 30 days or fraction of 30 days until the return is filed. The penalty imposed <br/>
<a id="pl.186.29"></a><var>186.29</var>under this section must not exceed the lesser of $25,000 or 25 percent of the assessed tax. <br/>
<a id="pl.186.30"></a><var>186.30</var><b>EFFECTIVE DATE.</b>This section is effective beginning January 2, 2008, for taxes <br/>
<a id="pl.186.31"></a><var>186.31</var>payable in 2009 and thereafter.<br/>
<br/>
<a id="bill.13.4.0"></a><a id="pl.187.1"></a><var>187.1</var>    Sec. 4. Minnesota Statutes 2006, section 270.072, subdivision 6, is amended to read:<br/>
<a id="pl.187.2"></a><var>187.2</var>    Subd. 6. <b>Airflight property tax lien.</b> The tax imposed under sections 
         <statute_ref>270.071</statute_ref> to <br/>
<statute_ref><a id="pl.187.3"></a><var>187.3</var>270.079
         </statute_ref> is a lien on all real and personal property within this state of the airline company <br/>
<a id="pl.187.4"></a><var>187.4</var>in whose name the property is assessed. For purposes of sections 
<statute_ref>270C.62</statute_ref> and 
<statute_ref>270C.63</statute_ref>, <br/>
<a id="pl.187.5"></a><var>187.5</var>the date of assessment for the tax imposed under sections 
<statute_ref>270.071</statute_ref> to 
<statute_ref>270.079</statute_ref> is The lien <br/>
<a id="pl.187.6"></a><var>187.6</var>attaches on January 2 of each year for the taxes payable in the following year.<br/>
<a id="pl.187.7"></a><var>187.7</var><b>EFFECTIVE DATE.</b>This section is effective beginning January 2, 2008, for taxes <br/>
<a id="pl.187.8"></a><var>187.8</var>payable in 2009 and thereafter.<br/>
<br/>
<a id="bill.13.5.0"></a><a id="pl.187.9"></a><var>187.9</var>    Sec. 5. <b>[270.0725] PENALTIES.</b><br/>
<a id="pl.187.10"></a><var>187.10</var>    Subdivision 1. <b>Penalty for late filing.</b> If an airline company does not file its annual <br/>
<a id="pl.187.11"></a><var>187.11</var>report by the date designated in section 270.072, subdivision 3, a penalty of five percent <br/>
<a id="pl.187.12"></a><var>187.12</var>of the tax being assessed is imposed on that company. On August 1, and on the first day <br/>
<a id="pl.187.13"></a><var>187.13</var>of each succeeding calendar month, an additional five percent penalty is imposed if the <br/>
<a id="pl.187.14"></a><var>187.14</var>report has not yet been filed. For each airline company, the penalties imposed under <br/>
<a id="pl.187.15"></a><var>187.15</var>this subdivision for any one year are limited to the lesser of $25,000 or 25 percent of <br/>
<a id="pl.187.16"></a><var>187.16</var>the assessed tax. <br/>
<a id="pl.187.17"></a><var>187.17</var>    Subd. 2. <b>Penalty for repeated instances of late filing.</b> If there is a pattern of <br/>
<a id="pl.187.18"></a><var>187.18</var>repeated failures by an airline company to timely file the report required by this section, a <br/>
<a id="pl.187.19"></a><var>187.19</var>penalty of ten percent of the tax being assessed is imposed on that company.<br/>
<a id="pl.187.20"></a><var>187.20</var>    Subd. 3. <b>Penalty for frivolous report.</b> If an airline company files a frivolous annual <br/>
<a id="pl.187.21"></a><var>187.21</var>report, a penalty of 25 percent of the tax being assessed is imposed on that company. A <br/>
<a id="pl.187.22"></a><var>187.22</var>frivolous report under this section is a report that would fulfill the criteria for a frivolous <br/>
<a id="pl.187.23"></a><var>187.23</var>return under section 289A.60, subdivision 7, notwithstanding the restriction in section <br/>
<a id="pl.187.24"></a><var>187.24</var>289A.01. In a proceeding involving the issue of whether or not an airline company is <br/>
<a id="pl.187.25"></a><var>187.25</var>liable for this penalty, the burden of proof is on the commissioner.<br/>
<a id="pl.187.26"></a><var>187.26</var>    Subd. 4. <b>Penalty for fraudulent report.</b> If an airline company files a false or <br/>
<a id="pl.187.27"></a><var>187.27</var>fraudulent annual report with intent to evade or defeat the tax, a penalty equal to 50 <br/>
<a id="pl.187.28"></a><var>187.28</var>percent of the tax being assessed is imposed on that company.<br/>
<a id="pl.187.29"></a><var>187.29</var>    Subd. 5. <b>Penalties added to tax.</b> Penalties imposed under this section are added to <br/>
<a id="pl.187.30"></a><var>187.30</var>the tax and collected as a part of it.<br/>
<a id="pl.187.31"></a><var>187.31</var><b>EFFECTIVE DATE.</b>This section is effective for annual reports due after June <br/>
<a id="pl.187.32"></a><var>187.32</var>30, 2008.<br/>
<br/>
<a id="bill.13.6.0"></a><a id="pl.187.33"></a><var>187.33</var>    Sec. 6. <b>[270.0735] EXAMINATION; INVESTIGATIONS; SUBPOENAS.</b><br/>
<a id="pl.188.1"></a><var>188.1</var>    In addition to the powers granted to the commissioner in this chapter, and in order to <br/>
<a id="pl.188.2"></a><var>188.2</var>determine net tax capacities and issue notices of net tax capacity and tax under sections <br/>
<a id="pl.188.3"></a><var>188.3</var>270.071 to 270.079, the commissioner has the powers contained in sections 270C.31 and <br/>
<a id="pl.188.4"></a><var>188.4</var>270C.32, for which purpose the word "taxpayer" as defined in section 270C.01 includes <br/>
<a id="pl.188.5"></a><var>188.5</var>an airline company.<br/>
<a id="pl.188.6"></a><var>188.6</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.7.0"></a><a id="pl.188.7"></a><var>188.7</var>    Sec. 7. Minnesota Statutes 2006, section 270.074, subdivision 3, is amended to read:<br/>
<a id="pl.188.8"></a><var>188.8</var>    Subd. 3. <b>Tax capacity.</b> (a) The net tax capacity of the flight property of every airline <br/>
<a id="pl.188.9"></a><var>188.9</var>company shall have a tax capacity of is 70 percent of the value thereof apportioned to this <br/>
<a id="pl.188.10"></a><var>188.10</var>state under subdivision 1, except that the net tax capacity of quiet aircraft shall have a <br/>
<a id="pl.188.11"></a><var>188.11</var>tax capacity of is 40 percent of the value determined under subdivision 1. Quiet aircraft <br/>
<a id="pl.188.12"></a><var>188.12</var>shall include "Quiet aircraft" means turboprops and aircraft defined as stage III or IV by <br/>
<a id="pl.188.13"></a><var>188.13</var>the Federal Aeronautics Administration. If, in the opinion of the commissioner, other <br/>
<a id="pl.188.14"></a><var>188.14</var>aircraft may be qualified as quiet aircraft, the commissioner may adopt rules providing <br/>
<a id="pl.188.15"></a><var>188.15</var>additional qualifications.<br/>
<a id="pl.188.16"></a><var>188.16</var>    (b) The flight property of an airline company that owns or leases aircraft the majority <br/>
<a id="pl.188.17"></a><var>188.17</var>of which are turboprops, and which provides, during six months or more of the year that <br/>
<a id="pl.188.18"></a><var>188.18</var>taxes are levied, scheduled passenger service to three or more airports inside or outside of <br/>
<a id="pl.188.19"></a><var>188.19</var>this state that serve small or medium sized communities, shall be assessed at 50 percent of <br/>
<a id="pl.188.20"></a><var>188.20</var>the assessment percentage otherwise set by paragraph (a).<br/>
<a id="pl.188.21"></a><var>188.21</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.8.0"></a><a id="pl.188.22"></a><var>188.22</var>    Sec. 8. Minnesota Statutes 2006, section 270.076, subdivision 1, is amended to read:<br/>
<a id="pl.188.23"></a><var>188.23</var>    Subdivision 1. <b>Appeal.</b> Any airline company against which a tax has been imposed <br/>
<a id="pl.188.24"></a><var>188.24</var>under sections 
<statute_ref>270.071</statute_ref> to 
<statute_ref>270.079</statute_ref> shall have the right to appeal within 60 days from the <br/>
<a id="pl.188.25"></a><var>188.25</var>date of notice of the levy of the tax The notices of net tax capacity and of tax required <br/>
<a id="pl.188.26"></a><var>188.26</var>under section 270.075, subdivision 2, are orders of the commissioner. These orders must <br/>
<a id="pl.188.27"></a><var>188.27</var>be issued in conformance with section 270C.33, subdivisions 1 and 2, but are not subject <br/>
<a id="pl.188.28"></a><var>188.28</var>to administrative review under section 270C.35. These orders may be appealed to the Tax <br/>
<a id="pl.188.29"></a><var>188.29</var>Court in the manner provided by law in section 271.06 for appealing official orders of <br/>
<a id="pl.188.30"></a><var>188.30</var>the commissioner that do not deal with valuation, assessment, or taxation for property <br/>
<a id="pl.188.31"></a><var>188.31</var>tax purposes, and the provisions of section 273.125, subdivisions 4 and 5, and chapter <br/>
<a id="pl.188.32"></a><var>188.32</var>278 do not apply. <br/>
<a id="pl.188.33"></a><var>188.33</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.9.0"></a><a id="pl.189.1"></a><var>189.1</var>    Sec. 9. Minnesota Statutes 2006, section 270.41, subdivision 1, is amended to read:<br/>
<a id="pl.189.2"></a><var>189.2</var>    Subdivision 1. <b>Creation; purpose; powers.</b> A Board of Assessors is created. <br/>
<a id="pl.189.3"></a><var>189.3</var>The board shall establish, conduct, review, supervise, coordinate, and approve courses <br/>
<a id="pl.189.4"></a><var>189.4</var>in assessment practices, and establish criteria for determining assessor's qualifications. <br/>
<a id="pl.189.5"></a><var>189.5</var>The board shall also consider other matters relating to assessment administration brought <br/>
<a id="pl.189.6"></a><var>189.6</var>before it by the commissioner of revenue. The board may grant, renew, suspend, or revoke <br/>
<a id="pl.189.7"></a><var>189.7</var>an assessor's license.<br/>
<a id="pl.189.8"></a><var>189.8</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.10.0"></a><a id="pl.189.9"></a><var>189.9</var>    Sec. 10. Minnesota Statutes 2006, section 270.41, is amended by adding a subdivision <br/>
<a id="pl.189.10"></a><var>189.10</var>to read:<br/>
<a id="pl.189.11"></a><var>189.11</var>    Subd. 1a. <b>Definition.</b> For purposes of sections 270.41 to 270.50, "board" means <br/>
<a id="pl.189.12"></a><var>189.12</var>the Board of Assessors.<br/>
<a id="pl.189.13"></a><var>189.13</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.11.0"></a><a id="pl.189.14"></a><var>189.14</var>    Sec. 11. Minnesota Statutes 2006, section 270.41, subdivision 2, is amended to read:<br/>
<a id="pl.189.15"></a><var>189.15</var>    Subd. 2. <b>Members.</b> The board shall consist of nine members, who shall be <br/>
<a id="pl.189.16"></a><var>189.16</var>appointed by the commissioner of revenue, in the manner provided herein. The members <br/>
<a id="pl.189.17"></a><var>189.17</var>shall include:<br/>
<a id="pl.189.18"></a><var>189.18</var>    (1) two from the Department of Revenue;<br/>
<a id="pl.189.19"></a><var>189.19</var>    (2) two county assessors;<br/>
<a id="pl.189.20"></a><var>189.20</var>    (3) two assessors who are not county assessors, one of whom shall be a township <br/>
<a id="pl.189.21"></a><var>189.21</var>assessor;<br/>
<a id="pl.189.22"></a><var>189.22</var>    (4) one from the private appraisal field holding a professional appraisal designation; <br/>
<a id="pl.189.23"></a><var>189.23</var>and<br/>
<a id="pl.189.24"></a><var>189.24</var>    (5) two public members as defined by section 
         <statute_ref>214.02</statute_ref>. <br/>
<a id="pl.189.25"></a><var>189.25</var>    The appointment provided in clauses (2) and (3) may be made from two lists a list <br/>
<a id="pl.189.26"></a><var>189.26</var>of not less than three names each, one submitted to the commissioner of revenue by the <br/>
<a id="pl.189.27"></a><var>189.27</var>Minnesota Association of Assessing Officers or its successor organization containing <br/>
<a id="pl.189.28"></a><var>189.28</var>recommendations for the appointment of appointees described in clause clauses (2), <br/>
<a id="pl.189.29"></a><var>189.29</var>and one by the Minnesota Association of Assessors, Inc. or its successor organization <br/>
<a id="pl.189.30"></a><var>189.30</var>containing recommendations for the appointees described in clause (3) and (3). The lists <br/>
<a id="pl.189.31"></a><var>189.31</var>list must be submitted 30 days before the commencement of the term. In the case of a <br/>
<a id="pl.189.32"></a><var>189.32</var>vacancy, a new list shall be furnished to the commissioner by the respective organization <br/>
<a id="pl.190.1"></a><var>190.1</var>immediately. A member of the board who is no longer engaged in the capacity listed <br/>
<a id="pl.190.2"></a><var>190.2</var>above that was the basis of appointment is disqualified from membership in the board.<br/>
<a id="pl.190.3"></a><var>190.3</var>    The board shall annually elect a chair and a secretary vice-chair of the board.<br/>
<a id="pl.190.4"></a><var>190.4</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.12.0"></a><a id="pl.190.5"></a><var>190.5</var>    Sec. 12. Minnesota Statutes 2006, section 270.41, subdivision 3, is amended to read:<br/>
<a id="pl.190.6"></a><var>190.6</var>    Subd. 3. <b>Licenses; refusal or revocation.</b> The board may refuse to grant or renew, <br/>
<a id="pl.190.7"></a><var>190.7</var>or may suspend or revoke, a license of an applicant or licensee for any of the following <br/>
<a id="pl.190.8"></a><var>190.8</var>causes or acts:<br/>
<a id="pl.190.9"></a><var>190.9</var>    (1) failure to complete required training;<br/>
<a id="pl.190.10"></a><var>190.10</var>    (2) inefficiency or neglect of duty;<br/>
<a id="pl.190.11"></a><var>190.11</var>    (3) "unprofessional conduct" which means knowingly neglecting to perform a duty <br/>
<a id="pl.190.12"></a><var>190.12</var>required by law, or violation of the laws of this state relating to the assessment of property <br/>
<a id="pl.190.13"></a><var>190.13</var>or unlawfully exempting property or knowingly and intentionally listing property on the <br/>
<a id="pl.190.14"></a><var>190.14</var>tax list at substantially less than its market value or the level required by law in order to <br/>
<a id="pl.190.15"></a><var>190.15</var>gain favor or benefit, or knowingly and intentionally misclassifying property in order to <br/>
<a id="pl.190.16"></a><var>190.16</var>gain favor or benefit failure to comply with the Code of Conduct and Ethics for Licensed <br/>
<a id="pl.190.17"></a><var>190.17</var>Minnesota Assessors adopted by the board pursuant to Laws 2005, First Special Session <br/>
<a id="pl.190.18"></a><var>190.18</var>chapter 3, article 1, section 38;<br/>
<a id="pl.190.19"></a><var>190.19</var>    (4) conviction of a crime involving moral turpitude; or<br/>
<a id="pl.190.20"></a><var>190.20</var>    (5) any other cause or act that in the board's opinion warrants a refusal to issue <br/>
<a id="pl.190.21"></a><var>190.21</var>or suspension or revocation of a license.<br/>
<a id="pl.190.22"></a><var>190.22</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.13.0"></a><a id="pl.190.23"></a><var>190.23</var>    Sec. 13. Minnesota Statutes 2006, section 270.41, subdivision 5, is amended to read:<br/>
<a id="pl.190.24"></a><var>190.24</var>    Subd. 5. <b>Prohibited activity.</b> An assessor, deputy assessor, assistant assessor, <br/>
<a id="pl.190.25"></a><var>190.25</var>appraiser, A licensed assessor or other person employed by an assessment jurisdiction <br/>
<a id="pl.190.26"></a><var>190.26</var>or contracting with an assessment jurisdiction for the purpose of valuing or classifying <br/>
<a id="pl.190.27"></a><var>190.27</var>property for property tax purposes is prohibited from making appraisals or analyses, <br/>
<a id="pl.190.28"></a><var>190.28</var>accepting an appraisal assignment, or preparing an appraisal report as defined in section <br/>
<statute_ref><a id="pl.190.29"></a><var>190.29</var>82B.02, subdivisions 2 to 5
         </statute_ref>, on any property within the assessment jurisdiction where the <br/>
<a id="pl.190.30"></a><var>190.30</var>individual is employed or performing the duties of the assessor under contract. Violation <br/>
<a id="pl.190.31"></a><var>190.31</var>of this prohibition shall result in immediate revocation of the individual's license to assess <br/>
<a id="pl.190.32"></a><var>190.32</var>property for property tax purposes. This prohibition must not be construed to prohibit an <br/>
<a id="pl.190.33"></a><var>190.33</var>individual from carrying out any duties required for the proper assessment of property <br/>
<a id="pl.191.1"></a><var>191.1</var>for property tax purposes. If a formal resolution has been adopted by the governing body <br/>
<a id="pl.191.2"></a><var>191.2</var>of a governmental unit, which specifies the purposes for which such work will be done, <br/>
<a id="pl.191.3"></a><var>191.3</var>this prohibition does not apply to appraisal activities undertaken on behalf of and at the <br/>
<a id="pl.191.4"></a><var>191.4</var>request of the governmental unit that has employed or contracted with the individual. <br/>
<a id="pl.191.5"></a><var>191.5</var>The resolution may only allow appraisal activities which are related to condemnations, <br/>
<a id="pl.191.6"></a><var>191.6</var>right-of-way acquisitions, or special assessments. <br/>
<a id="pl.191.7"></a><var>191.7</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.14.0"></a><a id="pl.191.8"></a><var>191.8</var>    Sec. 14. Minnesota Statutes 2006, section 270.44, is amended to read:<br/>
<a id="pl.191.9"></a><var>191.9</var><b>270.44 CHARGES FOR COURSES, EXAMINATIONS OR MATERIALS.</b><br/>
<a id="pl.191.10"></a><var>191.10</var>    The board shall charge the following fees:<br/>
<a id="pl.191.11"></a><var>191.11</var>    (1) $105 for a senior accredited Minnesota assessor license;<br/>
<a id="pl.191.12"></a><var>191.12</var>    (2) $80 for an accredited Minnesota assessor license;<br/>
<a id="pl.191.13"></a><var>191.13</var>    (3) $65 for a certified Minnesota assessor specialist license;<br/>
<a id="pl.191.14"></a><var>191.14</var>    (4) $55 for a certified Minnesota assessor license;<br/>
<a id="pl.191.15"></a><var>191.15</var>    (5) $50 for a course challenge examination;<br/>
<a id="pl.191.16"></a><var>191.16</var>    (6) (5) $35 for grading a form appraisal;<br/>
<a id="pl.191.17"></a><var>191.17</var>    (7) (6) $60 for grading a narrative appraisal;<br/>
<a id="pl.191.18"></a><var>191.18</var>    (8) (7) $30 for a reinstatement fee;<br/>
<a id="pl.191.19"></a><var>191.19</var>    (9) (8) $25 for a record retention fee; and<br/>
<a id="pl.191.20"></a><var>191.20</var>    (10) (9) $20 for an educational transcript; and.<br/>
<a id="pl.191.21"></a><var>191.21</var>    (11) $30 for all retests of board-sponsored educational courses.<br/>
<a id="pl.191.22"></a><var>191.22</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.15.0"></a><a id="pl.191.23"></a><var>191.23</var>    Sec. 15. Minnesota Statutes 2006, section 270.45, is amended to read:<br/>
<a id="pl.191.24"></a><var>191.24</var><b>270.45 DISPOSITION OF FEES.</b><br/>
<a id="pl.191.25"></a><var>191.25</var>    All fees so established and collected shall be paid to the commissioner of finance for <br/>
<a id="pl.191.26"></a><var>191.26</var>deposit in the general fund. The expenses of carrying out the provisions of sections 
         <statute_ref>270.41</statute_ref> <br/>
<a id="pl.191.27"></a><var>191.27</var>to 
         <statute_ref>270.53</statute_ref> shall be paid from appropriations made to the board of Assessors. <br/>
<a id="pl.191.28"></a><var>191.28</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.16.0"></a><a id="pl.191.29"></a><var>191.29</var>    Sec. 16. Minnesota Statutes 2006, section 270.46, is amended to read:<br/>
<a id="pl.191.30"></a><var>191.30</var><b>270.46 TRAINING COURSES, </b><b>ESTABLISHMENT; OTHER COURSES,</b><b> </b><br/>
<a id="pl.191.31"></a><var>191.31</var><b>REGULATION.</b><br/>
<a id="pl.192.1"></a><var>192.1</var>    The board shall establish review and approve training courses on assessment <br/>
<a id="pl.192.2"></a><var>192.2</var>practices and shall review and approve courses on assessment practices, techniques of <br/>
<a id="pl.192.3"></a><var>192.3</var>assessment, and ethics offered by schools, colleges and,  universities as well as courses that <br/>
<a id="pl.192.4"></a><var>192.4</var>are offered by any units of government on techniques of assessment. Courses shall be <br/>
<a id="pl.192.5"></a><var>192.5</var>established in various places throughout the state and be offered on regular intervals, units <br/>
<a id="pl.192.6"></a><var>192.6</var>of government, and other entities.<br/>
<a id="pl.192.7"></a><var>192.7</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.17.0"></a><a id="pl.192.8"></a><var>192.8</var>    Sec. 17. Minnesota Statutes 2006, section 270.47, is amended to read:<br/>
<a id="pl.192.9"></a><var>192.9</var><b>270.47 RULES.</b><br/>
<a id="pl.192.10"></a><var>192.10</var>    The board shall establish the adopt rules necessary to accomplish the purpose of <br/>
<a id="pl.192.11"></a><var>192.11</var>section sections 
<statute_ref>270.41</statute_ref> to 270.51, and shall establish criteria required of assessing officials <br/>
<a id="pl.192.12"></a><var>192.12</var>in the state. Separate criteria may be established depending upon the responsibilities of the <br/>
<a id="pl.192.13"></a><var>192.13</var>assessor. The board shall prepare and give examinations from time to time to determine <br/>
<a id="pl.192.14"></a><var>192.14</var>whether assessing officials possess the necessary qualifications for performing the <br/>
<a id="pl.192.15"></a><var>192.15</var>functions of the office. Such tests shall be given immediately upon completion of courses <br/>
<a id="pl.192.16"></a><var>192.16</var>required by the board, or to persons who already possess the requisite qualifications under <br/>
<a id="pl.192.17"></a><var>192.17</var>the rules of the board. An action of the board in refusing to grant or renew a license or in <br/>
<a id="pl.192.18"></a><var>192.18</var>suspending or revoking a license is subject to review in accordance with chapter 14. <br/>
<a id="pl.192.19"></a><var>192.19</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.18.0"></a><a id="pl.192.20"></a><var>192.20</var>    Sec. 18. Minnesota Statutes 2006, section 270.48, is amended to read:<br/>
<a id="pl.192.21"></a><var>192.21</var><b>270.48 LICENSURE OF QUALIFIED PERSONS.</b><br/>
<a id="pl.192.22"></a><var>192.22</var>    The board shall may license persons as possessing the necessary qualifications of an <br/>
<a id="pl.192.23"></a><var>192.23</var>assessing official. Different levels of licensure may be established as to classes of property <br/>
<a id="pl.192.24"></a><var>192.24</var>which assessors may be certified to assess at the discretion of the board. Every person, <br/>
<a id="pl.192.25"></a><var>192.25</var>except a local or county assessor, regularly employed by the assessor to assist in making <br/>
<a id="pl.192.26"></a><var>192.26</var>decisions regarding valuing and classifying property for assessment purposes shall be <br/>
<a id="pl.192.27"></a><var>192.27</var>required to must become licensed within three years of the date of employment. Licensure <br/>
<a id="pl.192.28"></a><var>192.28</var>shall be required for local and county assessors as otherwise provided in sections 
         <statute_ref>270.41</statute_ref> <br/>
<a id="pl.192.29"></a><var>192.29</var>to 
<statute_ref>270.53</statute_ref> 270.50 and 273.061, and rules adopted by the board. <br/>
<a id="pl.192.30"></a><var>192.30</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.19.0"></a><a id="pl.193.1"></a><var>193.1</var>    Sec. 19. Minnesota Statutes 2006, section 270.50, is amended to read:<br/>
<a id="pl.193.2"></a><var>193.2</var><b>270.50 EMPLOYMENT OF LICENSED ASSESSORS.</b><br/>
<a id="pl.193.3"></a><var>193.3</var>    No assessor shall be employed who has not been licensed as qualified by the board, <br/>
<a id="pl.193.4"></a><var>193.4</var>provided the time to comply may be extended after application to the board upon a <br/>
<a id="pl.193.5"></a><var>193.5</var>showing that licensed assessors are not available for employment. The board may license <br/>
<a id="pl.193.6"></a><var>193.6</var>that a county or local assessor who has not received the training, but possesses the <br/>
<a id="pl.193.7"></a><var>193.7</var>necessary qualifications for performing the functions of the office by the passage of an <br/>
<a id="pl.193.8"></a><var>193.8</var>approved examination or may waive the examination if such person has demonstrated <br/>
<a id="pl.193.9"></a><var>193.9</var>competence in performing the functions of the office for a period of time the board deems <br/>
<a id="pl.193.10"></a><var>193.10</var>reasonable. The county or local assessing district shall assume the cost of training of its <br/>
<a id="pl.193.11"></a><var>193.11</var>assessors in courses approved by the board for the purpose of obtaining the assessor's <br/>
<a id="pl.193.12"></a><var>193.12</var>license to the extent of course fees, mileage, meals and lodging, and recognized travel <br/>
<a id="pl.193.13"></a><var>193.13</var>expenses not paid by the state. If the governing body of any township or city fails to <br/>
<a id="pl.193.14"></a><var>193.14</var>employ an assessor as required by sections 
<statute_ref>270.41</statute_ref> to 
<statute_ref>270.53</statute_ref>, the assessment shall be <br/>
<a id="pl.193.15"></a><var>193.15</var>made by the county assessor. <br/>
<a id="pl.193.16"></a><var>193.16</var>    In the case of cities incorporated or townships organized after April 11, 1974, except <br/>
<a id="pl.193.17"></a><var>193.17</var>cities or towns located in Ramsey county or which have elected a county assessor system <br/>
<a id="pl.193.18"></a><var>193.18</var>in accordance with section 
<statute_ref>273.055</statute_ref>, the board shall allow the city or town 90 days from <br/>
<a id="pl.193.19"></a><var>193.19</var>the date of incorporation or organization to employ a licensed assessor. <br/>
<a id="pl.193.20"></a><var>193.20</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.20.0"></a><a id="pl.193.21"></a><var>193.21</var>    Sec. 20. Minnesota Statutes 2006, section 270C.306, is amended to read:<br/>
<a id="pl.193.22"></a><var>193.22</var><b>270C.306 COMMISSIONER MAY REQUIRE SOCIAL SECURITY OR </b><br/>
<a id="pl.193.23"></a><var>193.23</var><b>IDENTIFYING NUMBERS ON FORMS.</b><br/>
<a id="pl.193.24"></a><var>193.24</var>    Notwithstanding the provisions of any other law except section 272.115, the <br/>
<a id="pl.193.25"></a><var>193.25</var>commissioner may require that a form required to be filed with the commissioner include <br/>
<a id="pl.193.26"></a><var>193.26</var>the Social Security number, federal employer identification number, or Minnesota <br/>
<a id="pl.193.27"></a><var>193.27</var>taxpayer identification number of the taxpayer or applicant.<br/>
<a id="pl.193.28"></a><var>193.28</var><b>EFFECTIVE DATE.</b>This section is effective beginning after June 30, 2008.<br/>
<br/>
<a id="bill.13.21.0"></a><a id="pl.193.29"></a><var>193.29</var>    Sec. 21. Minnesota Statutes 2006, section 270C.34, subdivision 1, is amended to read:<br/>
<a id="pl.193.30"></a><var>193.30</var>    Subdivision 1. <b>Authority.</b> (a) The commissioner may abate, reduce, or refund any <br/>
<a id="pl.193.31"></a><var>193.31</var>penalty or interest that is imposed by a law administered by the commissioner as a result <br/>
<a id="pl.193.32"></a><var>193.32</var>of the late payment of tax or late filing of a return, if the failure to timely pay the tax or <br/>
<a id="pl.194.1"></a><var>194.1</var>failure to timely file the return is due to reasonable cause, or if the taxpayer is located <br/>
<a id="pl.194.2"></a><var>194.2</var>in a presidentially declared disaster area.<br/>
<a id="pl.194.3"></a><var>194.3</var>    (b) The commissioner shall abate any part of a penalty or additional tax charge <br/>
<a id="pl.194.4"></a><var>194.4</var>under section 
         <statute_ref>289A.25, subdivision 2</statute_ref>, or 
         <statute_ref>289A.26, subdivision 4</statute_ref>, attributable to erroneous <br/>
<a id="pl.194.5"></a><var>194.5</var>advice given to the taxpayer in writing by an employee of the department acting in <br/>
<a id="pl.194.6"></a><var>194.6</var>an official capacity, if the advice:<br/>
<a id="pl.194.7"></a><var>194.7</var>    (1) was reasonably relied on and was in response to a specific written request of the <br/>
<a id="pl.194.8"></a><var>194.8</var>taxpayer; and<br/>
<a id="pl.194.9"></a><var>194.9</var>    (2) was not the result of failure by the taxpayer to provide adequate or accurate <br/>
<a id="pl.194.10"></a><var>194.10</var>information.<br/>
<a id="pl.194.11"></a><var>194.11</var>    (c) The commissioner may abate a penalty imposed under section 270.0725, <br/>
<a id="pl.194.12"></a><var>194.12</var>subdivision 1 or 2, if the failure to timely file is due to reasonable cause, or if the airline <br/>
<a id="pl.194.13"></a><var>194.13</var>company is located in a presidentially declared disaster area.<br/>
<a id="pl.194.14"></a><var>194.14</var><b>EFFECTIVE DATE.</b>This section is effective for penalties imposed after June <br/>
<a id="pl.194.15"></a><var>194.15</var>30, 2008.<br/>
<br/>
<a id="bill.13.22.0"></a><a id="pl.194.16"></a><var>194.16</var>    Sec. 22. Minnesota Statutes 2007 Supplement, section 272.02, subdivision 64, is <br/>
<a id="pl.194.17"></a><var>194.17</var>amended to read:<br/>
<a id="pl.194.18"></a><var>194.18</var>    Subd. 64. <b>Job opportunity building zone property.</b> (a) Improvements to real <br/>
<a id="pl.194.19"></a><var>194.19</var>property, and personal property, classified under section 
         <statute_ref>273.13, subdivision 24</statute_ref>, and <br/>
<a id="pl.194.20"></a><var>194.20</var>located within a job opportunity building zone, designated under section 
         <statute_ref>469.314</statute_ref>, are <br/>
<a id="pl.194.21"></a><var>194.21</var>exempt from ad valorem taxes levied under chapter 275.<br/>
<a id="pl.194.22"></a><var>194.22</var>    (b) Improvements to real property, and tangible personal property, of an agricultural <br/>
<a id="pl.194.23"></a><var>194.23</var>production facility located within an agricultural processing facility zone, designated <br/>
<a id="pl.194.24"></a><var>194.24</var>under section 
         <statute_ref>469.314</statute_ref>, is exempt from ad valorem taxes levied under chapter 275.<br/>
<a id="pl.194.25"></a><var>194.25</var>    (c) For property to qualify for exemption under paragraph (a), the occupant must be <br/>
<a id="pl.194.26"></a><var>194.26</var>a qualified business, as defined in section 
         <statute_ref>469.310</statute_ref>.<br/>
<a id="pl.194.27"></a><var>194.27</var>    (d) The exemption applies beginning for the first assessment year after designation <br/>
<a id="pl.194.28"></a><var>194.28</var>of the job opportunity building zone by the commissioner of employment and economic <br/>
<a id="pl.194.29"></a><var>194.29</var>development. The exemption applies to each assessment year that begins during the <br/>
<a id="pl.194.30"></a><var>194.30</var>duration of the job opportunity building zone. To be exempt, the property must be <br/>
<a id="pl.194.31"></a><var>194.31</var>occupied by July 1 of the assessment year by a qualified business that has signed the <br/>
<a id="pl.194.32"></a><var>194.32</var>business subsidy agreement and relocation agreement, if required, by July 1 of the <br/>
<a id="pl.194.33"></a><var>194.33</var>assessment year. This exemption does not apply to:<br/>
<a id="pl.194.34"></a><var>194.34</var>    (1) the levy under section 
         <statute_ref>475.61</statute_ref> or similar levy provisions under any other law to <br/>
<a id="pl.194.35"></a><var>194.35</var>pay general obligation bonds; or<br/>
<a id="pl.195.1"></a><var>195.1</var>    (2) other school district levies included in the debt service levy of the district <br/>
<a id="pl.195.2"></a><var>195.2</var>under section 
         <statute_ref>123B.55</statute_ref>.<br/>
<a id="pl.195.3"></a><var>195.3</var>    (e) Except for property of a business that was exempt under this subdivision for <br/>
<a id="pl.195.4"></a><var>195.4</var>taxes payable in 2008, a business must notify the county assessor in writing of eligibility <br/>
<a id="pl.195.5"></a><var>195.5</var>under this subdivision by July 1 in order to begin receiving the exemption under this <br/>
<a id="pl.195.6"></a><var>195.6</var>subdivision for taxes payable in the following year. The business need not annually notify <br/>
<a id="pl.195.7"></a><var>195.7</var>the county assessor of its continued exemption under this subdivision, but must notify the <br/>
<a id="pl.195.8"></a><var>195.8</var>county assessor immediately if the exemption no longer applies.<br/>
<a id="pl.195.9"></a><var>195.9</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.23.0"></a><a id="pl.195.10"></a><var>195.10</var>    Sec. 23. Minnesota Statutes 2006, section 272.115, subdivision 1, is amended to read:<br/>
<a id="pl.195.11"></a><var>195.11</var>    Subdivision 1. <b>Requirement.</b> Except as otherwise provided in subdivision 5, <br/>
<a id="pl.195.12"></a><var>195.12</var>whenever any real estate is sold for a consideration in excess of $1,000, whether by <br/>
<a id="pl.195.13"></a><var>195.13</var>warranty deed, quitclaim deed, contract for deed or any other method of sale, the grantor, <br/>
<a id="pl.195.14"></a><var>195.14</var>grantee or the legal agent of either shall file a certificate of value with the county auditor <br/>
<a id="pl.195.15"></a><var>195.15</var>in the county in which the property is located when the deed or other document is <br/>
<a id="pl.195.16"></a><var>195.16</var>presented for recording. Contract for deeds are subject to recording under section 
         <statute_ref>507.235, <br/>
<a id="pl.195.17"></a><var>195.17</var>subdivision 1
         </statute_ref>. Value shall, in the case of any deed not a gift, be the amount of the full <br/>
<a id="pl.195.18"></a><var>195.18</var>actual consideration thereof, paid or to be paid, including the amount of any lien or liens <br/>
<a id="pl.195.19"></a><var>195.19</var>assumed. The items and value of personal property transferred with the real property <br/>
<a id="pl.195.20"></a><var>195.20</var>must be listed and deducted from the sale price. The certificate of value shall include <br/>
<a id="pl.195.21"></a><var>195.21</var>the classification to which the property belongs for the purpose of determining the fair <br/>
<a id="pl.195.22"></a><var>195.22</var>market value of the property. The certificate shall include financing terms and conditions <br/>
<a id="pl.195.23"></a><var>195.23</var>of the sale which are necessary to determine the actual, present value of the sale price <br/>
<a id="pl.195.24"></a><var>195.24</var>for purposes of the sales ratio study. The commissioner of revenue shall promulgate <br/>
<a id="pl.195.25"></a><var>195.25</var>administrative rules specifying the financing terms and conditions which must be included <br/>
<a id="pl.195.26"></a><var>195.26</var>on the certificate. Pursuant to the authority of the commissioner of revenue in section <br/>
<a id="pl.195.27"></a><var>195.27</var><statute_ref>270C.306</statute_ref>, The certificate of value must include the Social Security number or the federal <br/>
<a id="pl.195.28"></a><var>195.28</var>employer identification number of the grantors and grantees. However, a married person <br/>
<a id="pl.195.29"></a><var>195.29</var>who is not an owner of record and who is signing a conveyance instrument along with <br/>
<a id="pl.195.30"></a><var>195.30</var>the person's spouse solely to release and convey their marital interest, if any, in the real <br/>
<a id="pl.195.31"></a><var>195.31</var>property being conveyed is not a grantor for the purpose of the preceding sentence. A <br/>
<a id="pl.195.32"></a><var>195.32</var>statement in the deed that is substantially in the following form is sufficient to allow the <br/>
<a id="pl.195.33"></a><var>195.33</var>county auditor to accept a certificate for filing without the Social Security number of the <br/>
<a id="pl.195.34"></a><var>195.34</var>named spouse: " (Name) claims no ownership interest in the real property being conveyed <br/>
<a id="pl.195.35"></a><var>195.35</var>and is executing this instrument solely to release and convey a marital interest, if any, in <br/>
<a id="pl.196.1"></a><var>196.1</var>that real property." The identification numbers of the grantors and grantees are private <br/>
<a id="pl.196.2"></a><var>196.2</var>data on individuals or nonpublic data as defined in section 
         <statute_ref>13.02, subdivisions 9 and 12</statute_ref>, <br/>
<a id="pl.196.3"></a><var>196.3</var>but, notwithstanding that section, the private or nonpublic data may be disclosed to the <br/>
<a id="pl.196.4"></a><var>196.4</var>commissioner of revenue for purposes of tax administration. The information required to <br/>
<a id="pl.196.5"></a><var>196.5</var>be shown on the certificate of value is limited to the information required as of the date of <br/>
<a id="pl.196.6"></a><var>196.6</var>the acknowledgment on the deed or other document to be recorded.<br/>
<a id="pl.196.7"></a><var>196.7</var><b>EFFECTIVE DATE.</b>This section is effective for certificates of value filed after <br/>
<a id="pl.196.8"></a><var>196.8</var>June 30, 2008.<br/>
<br/>
<a id="bill.13.24.0"></a><a id="pl.196.9"></a><var>196.9</var>    Sec. 24. Minnesota Statutes 2006, section 273.05, is amended by adding a subdivision <br/>
<a id="pl.196.10"></a><var>196.10</var>to read:<br/>
<a id="pl.196.11"></a><var>196.11</var>    Subd. 3. <b>Cities and townships; employment of licensed assessor.</b> In the case <br/>
<a id="pl.196.12"></a><var>196.12</var>of cities or townships, except cities or towns located in Ramsey County or which have <br/>
<a id="pl.196.13"></a><var>196.13</var>elected a county assessor system in accordance with section 273.055, the commissioner <br/>
<a id="pl.196.14"></a><var>196.14</var>shall allow the city or town 90 days from the date of incorporation or organization to <br/>
<a id="pl.196.15"></a><var>196.15</var>employ a licensed assessor.<br/>
<a id="pl.196.16"></a><var>196.16</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.25.0"></a><a id="pl.196.17"></a><var>196.17</var>    Sec. 25. <b>[273.0535] COUNTY OR LOCAL ASSESSING DISTRICT TO ASSUME </b><br/>
<a id="pl.196.18"></a><var>196.18</var><b>COST OF TRAINING.</b><br/>
<a id="pl.196.19"></a><var>196.19</var>    The county or local assessing district must assume the cost of training its assessors <br/>
<a id="pl.196.20"></a><var>196.20</var>in courses approved by the board for the purpose of obtaining the assessor's license to <br/>
<a id="pl.196.21"></a><var>196.21</var>the extent of course fees, mileage, meals, and lodging, and recognized travel expenses <br/>
<a id="pl.196.22"></a><var>196.22</var>not paid by the state.<br/>
<a id="pl.196.23"></a><var>196.23</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.26.0"></a><a id="pl.196.24"></a><var>196.24</var>    Sec. 26. Minnesota Statutes 2006, section 273.111, subdivision 3, is amended to read:<br/>
<a id="pl.196.25"></a><var>196.25</var>    Subd. 3. <b>Requirements.</b> (a) Real estate consisting of ten acres or more or a nursery <br/>
<a id="pl.196.26"></a><var>196.26</var>or greenhouse, and qualifying for classification as class 1b, 2a, or 2b under section 
         <statute_ref>273.13, <br/>
</statute_ref><a id="pl.196.27"></a><var>196.27</var>shall be entitled to valuation and tax deferment under this section only if it is primarily <br/>
<a id="pl.196.28"></a><var>196.28</var>devoted to agricultural use, and meets the qualifications in subdivision 6, and either: <br/>
<a id="pl.196.29"></a><var>196.29</var>    (1) is the homestead of the owner, or of a surviving spouse, child, or sibling of the <br/>
<a id="pl.196.30"></a><var>196.30</var>owner or is real estate which is farmed with the real estate which contains the homestead <br/>
<a id="pl.196.31"></a><var>196.31</var>property; or<br/>
<a id="pl.197.1"></a><var>197.1</var>    (2) has been in possession of the applicant, the applicant's spouse, parent, or sibling, <br/>
<a id="pl.197.2"></a><var>197.2</var>or any combination thereof, for a period of at least seven years prior to application for <br/>
<a id="pl.197.3"></a><var>197.3</var>benefits under the provisions of this section, or is real estate which is farmed with the <br/>
<a id="pl.197.4"></a><var>197.4</var>real estate which qualifies under this clause and is within four townships or cities or <br/>
<a id="pl.197.5"></a><var>197.5</var>combination thereof from the qualifying real estate; or<br/>
<a id="pl.197.6"></a><var>197.6</var>    (3) is the homestead of a shareholder in a family farm corporation as defined in <br/>
<a id="pl.197.7"></a><var>197.7</var>section 
         <statute_ref>500.24</statute_ref>, notwithstanding the fact that legal title to the real estate may be held in the <br/>
<a id="pl.197.8"></a><var>197.8</var>name of the family farm corporation; or <br/>
<a id="pl.197.9"></a><var>197.9</var>    (4) is in the possession of a nursery or greenhouse or an entity owned by a proprietor, <br/>
<a id="pl.197.10"></a><var>197.10</var>partnership, or corporation which also owns the nursery or greenhouse operations on <br/>
<a id="pl.197.11"></a><var>197.11</var>the parcel or parcels.<br/>
<a id="pl.197.12"></a><var>197.12</var>    (b) Valuation of real estate under this section is limited to parcels the ownership of <br/>
<a id="pl.197.13"></a><var>197.13</var>which is in noncorporate entities except for:<br/>
<a id="pl.197.14"></a><var>197.14</var>    (1) family farm corporations organized pursuant to section 
         <statute_ref>500.24</statute_ref>; and <br/>
<a id="pl.197.15"></a><var>197.15</var>    (2) corporations that derive 80 percent or more of their gross receipts from the <br/>
<a id="pl.197.16"></a><var>197.16</var>wholesale or retail sale of horticultural or nursery stock.<br/>
<a id="pl.197.17"></a><var>197.17</var>    Corporate entities who previously qualified for tax deferment pursuant to this section <br/>
<a id="pl.197.18"></a><var>197.18</var>and who continue to otherwise qualify under subdivisions 3 and 6 for a period of at least <br/>
<a id="pl.197.19"></a><var>197.19</var>three years following the effective date of Laws 1983, chapter 222, section 8, will not be <br/>
<a id="pl.197.20"></a><var>197.20</var>required to make payment of the previously deferred taxes, notwithstanding the provisions <br/>
<a id="pl.197.21"></a><var>197.21</var>of subdivision 9. Special assessments are payable at the end of the three-year period <br/>
<a id="pl.197.22"></a><var>197.22</var>or at time of sale, whichever comes first.<br/>
<a id="pl.197.23"></a><var>197.23</var>    (c) Land that previously qualified for tax deferment under this section and no longer <br/>
<a id="pl.197.24"></a><var>197.24</var>qualifies because it is not primarily used for agricultural purposes but would otherwise <br/>
<a id="pl.197.25"></a><var>197.25</var>qualify under subdivisions 3 and 6 for a period of at least three years will not be required <br/>
<a id="pl.197.26"></a><var>197.26</var>to make payment of the previously deferred taxes, notwithstanding the provisions of <br/>
<a id="pl.197.27"></a><var>197.27</var>subdivision 9. Sale of the land prior to the expiration of the three-year period requires <br/>
<a id="pl.197.28"></a><var>197.28</var>payment of deferred taxes as follows: sale in the year the land no longer qualifies requires <br/>
<a id="pl.197.29"></a><var>197.29</var>payment of the current year's deferred taxes plus payment of deferred taxes for the two <br/>
<a id="pl.197.30"></a><var>197.30</var>prior years; sale during the second year the land no longer qualifies requires payment of <br/>
<a id="pl.197.31"></a><var>197.31</var>the current year's deferred taxes plus payment of the deferred taxes for the prior year; and <br/>
<a id="pl.197.32"></a><var>197.32</var>sale during the third year the land no longer qualifies requires payment of the current <br/>
<a id="pl.197.33"></a><var>197.33</var>year's deferred taxes. Deferred taxes shall be paid even if the land qualifies pursuant to <br/>
<a id="pl.197.34"></a><var>197.34</var>subdivision 11a. When such property is sold or no longer qualifies under this paragraph, or <br/>
<a id="pl.197.35"></a><var>197.35</var>at the end of the three-year period, whichever comes first, all deferred special assessments <br/>
<a id="pl.197.36"></a><var>197.36</var>plus interest are payable in equal installments spread over the time remaining until the last <br/>
<a id="pl.198.1"></a><var>198.1</var>maturity date of the bonds issued to finance the improvement for which the assessments <br/>
<a id="pl.198.2"></a><var>198.2</var>were levied. If the bonds have matured, the deferred special assessments plus interest <br/>
<a id="pl.198.3"></a><var>198.3</var>are payable within 90 days. The provisions of section 
         <statute_ref>429.061, subdivision 2</statute_ref>, apply <br/>
<a id="pl.198.4"></a><var>198.4</var>to the collection of these installments. Penalties are not imposed on any such special <br/>
<a id="pl.198.5"></a><var>198.5</var>assessments if timely paid. <br/>
<a id="pl.198.6"></a><var>198.6</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.27.0"></a><a id="pl.198.7"></a><var>198.7</var>    Sec. 27. Minnesota Statutes 2006, section 273.117, is amended to read:<br/>
<a id="pl.198.8"></a><var>198.8</var><b>273.117 CONSERVATION PROPERTY TAX VALUATION.</b><br/>
<a id="pl.198.9"></a><var>198.9</var>    The value of real property which is subject to a conservation restriction or easement <br/>
<a id="pl.198.10"></a><var>198.10</var>shall be entitled to reduced valuation under this section may be adjusted by the assessor if:<br/>
<a id="pl.198.11"></a><var>198.11</var>    (a) The restriction or easement is for a conservation purpose as defined in section <br/>
<statute_ref><a id="pl.198.12"></a><var>198.12</var>84.64, subdivision 2
         </statute_ref>, and is recorded on the property; <br/>
<a id="pl.198.13"></a><var>198.13</var>    (b) The property is being used in accordance with the terms of the conservation <br/>
<a id="pl.198.14"></a><var>198.14</var>restriction or easement.<br/>
<a id="pl.198.15"></a><var>198.15</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.28.0"></a><a id="pl.198.16"></a><var>198.16</var>    Sec. 28. Minnesota Statutes 2006, section 273.121, is amended to read:<br/>
<a id="pl.198.17"></a><var>198.17</var><b>273.121 VALUATION OF REAL PROPERTY, NOTICE.</b><br/>
<a id="pl.198.18"></a><var>198.18</var>    Any county assessor or city assessor having the powers of a county assessor, valuing <br/>
<a id="pl.198.19"></a><var>198.19</var>or classifying taxable real property shall in each year notify those persons whose property <br/>
<a id="pl.198.20"></a><var>198.20</var>is to be included on the assessment roll that year if the person's address is known to the <br/>
<a id="pl.198.21"></a><var>198.21</var>assessor, otherwise the occupant of the property. The notice shall be in writing and shall be <br/>
<a id="pl.198.22"></a><var>198.22</var>sent by ordinary mail at least ten days before the meeting of the local board of appeal and <br/>
<a id="pl.198.23"></a><var>198.23</var>equalization under section 
         <statute_ref>274.01</statute_ref> or the review process established under section 
         <statute_ref>274.13, <br/>
<a id="pl.198.24"></a><var>198.24</var>subdivision 1c
         </statute_ref>. Upon written request by the owner of the property, the assessor may send <br/>
<a id="pl.198.25"></a><var>198.25</var>the notice in electronic form or by electronic mail instead of on paper or by ordinary mail. <br/>
<a id="pl.198.26"></a><var>198.26</var>It shall contain: (1) the market value for the current and prior assessment, (2) the limited <br/>
<a id="pl.198.27"></a><var>198.27</var>market value under section 
         <statute_ref>273.11, subdivision 1a</statute_ref>, for the current and prior assessment, <br/>
<a id="pl.198.28"></a><var>198.28</var>(3) the qualifying amount of any improvements under section 
         <statute_ref>273.11, subdivision 16</statute_ref>, <br/>
<a id="pl.198.29"></a><var>198.29</var>for the current assessment, (4) the market value subject to taxation after subtracting the <br/>
<a id="pl.198.30"></a><var>198.30</var>amount of any qualifying improvements for the current assessment, (5) the classification <br/>
<a id="pl.198.31"></a><var>198.31</var>of the property for the current and prior assessment, (6) a note that if the property is <br/>
<a id="pl.198.32"></a><var>198.32</var>homestead and at least 45 years old, improvements made to the property may be eligible <br/>
<a id="pl.198.33"></a><var>198.33</var>for a valuation exclusion under section 
         <statute_ref>273.11, subdivision 16</statute_ref>, (7) the assessor's office <br/>
<a id="pl.199.1"></a><var>199.1</var>address, and (8) the dates, places, and times set for the meetings of the local board of <br/>
<a id="pl.199.2"></a><var>199.2</var>appeal and equalization, the review process established under section 
         <statute_ref>274.13, subdivision <br/>
<a id="pl.199.3"></a><var>199.3</var>1c
         </statute_ref>, and the county board of appeal and equalization. The commissioner of revenue shall <br/>
<a id="pl.199.4"></a><var>199.4</var>specify the form of the notice. The assessor shall attach to the assessment roll a statement <br/>
<a id="pl.199.5"></a><var>199.5</var>that the notices required by this section have been mailed. Any assessor who is not <br/>
<a id="pl.199.6"></a><var>199.6</var>provided sufficient funds from the assessor's governing body to provide such notices, <br/>
<a id="pl.199.7"></a><var>199.7</var>may make application to the commissioner of revenue to finance such notices. The <br/>
<a id="pl.199.8"></a><var>199.8</var>commissioner of revenue shall conduct an investigation and, if satisfied that the assessor <br/>
<a id="pl.199.9"></a><var>199.9</var>does not have the necessary funds, issue a certification to the commissioner of finance <br/>
<a id="pl.199.10"></a><var>199.10</var>of the amount necessary to provide such notices. The commissioner of finance shall <br/>
<a id="pl.199.11"></a><var>199.11</var>issue a warrant for such amount and shall deduct such amount from any state payment <br/>
<a id="pl.199.12"></a><var>199.12</var>to such county or municipality. The necessary funds to make such payments are hereby <br/>
<a id="pl.199.13"></a><var>199.13</var>appropriated. Failure to receive the notice shall in no way affect the validity of the <br/>
<a id="pl.199.14"></a><var>199.14</var>assessment, the resulting tax, the procedures of any board of review or equalization, or <br/>
<a id="pl.199.15"></a><var>199.15</var>the enforcement of delinquent taxes by statutory means. <br/>
<a id="pl.199.16"></a><var>199.16</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.29.0"></a><a id="pl.199.17"></a><var>199.17</var>    Sec. 29. Minnesota Statutes 2006, section 273.124, subdivision 13, is amended to read:<br/>
<a id="pl.199.18"></a><var>199.18</var>    Subd. 13. <b>Homestead application.</b> (a) A person who meets the homestead <br/>
<a id="pl.199.19"></a><var>199.19</var>requirements under subdivision 1 must file a homestead application with the county <br/>
<a id="pl.199.20"></a><var>199.20</var>assessor to initially obtain homestead classification.<br/>
<a id="pl.199.21"></a><var>199.21</var>    (b) On or before January 2, 1993, each county assessor shall mail a homestead <br/>
<a id="pl.199.22"></a><var>199.22</var>application to the owner of each parcel of property within the county which was <br/>
<a id="pl.199.23"></a><var>199.23</var>classified as homestead for the 1992 assessment year. The format and contents of a <br/>
<a id="pl.199.24"></a><var>199.24</var>uniform homestead application shall be prescribed by the commissioner of revenue. The <br/>
<a id="pl.199.25"></a><var>199.25</var>commissioner shall consult with the chairs of the house and senate tax committees on the <br/>
<a id="pl.199.26"></a><var>199.26</var>contents of the homestead application form. The application must clearly inform the <br/>
<a id="pl.199.27"></a><var>199.27</var>taxpayer that this application must be signed by all owners who occupy the property or <br/>
<a id="pl.199.28"></a><var>199.28</var>by the qualifying relative and returned to the county assessor in order for the property to <br/>
<a id="pl.199.29"></a><var>199.29</var>continue receiving receive homestead treatment. The envelope containing the homestead <br/>
<a id="pl.199.30"></a><var>199.30</var>application shall clearly identify its contents and alert the taxpayer of its necessary <br/>
<a id="pl.199.31"></a><var>199.31</var>immediate response.<br/>
<a id="pl.199.32"></a><var>199.32</var>    (c) Every property owner applying for homestead classification must furnish to the <br/>
<a id="pl.199.33"></a><var>199.33</var>county assessor the Social Security number of each occupant who is listed as an owner <br/>
<a id="pl.199.34"></a><var>199.34</var>of the property on the deed of record, the name and address of each owner who does not <br/>
<a id="pl.199.35"></a><var>199.35</var>occupy the property, and the name and Social Security number of each owner's spouse who <br/>
<a id="pl.200.1"></a><var>200.1</var>occupies the property. The application must be signed by each owner who occupies the <br/>
<a id="pl.200.2"></a><var>200.2</var>property and by each owner's spouse who occupies the property, or, in the case of property <br/>
<a id="pl.200.3"></a><var>200.3</var>that qualifies as a homestead under subdivision 1, paragraph (c), by the qualifying relative.<br/>
<a id="pl.200.4"></a><var>200.4</var>    If a property owner occupies a homestead, the property owner's spouse may not <br/>
<a id="pl.200.5"></a><var>200.5</var>claim another property as a homestead unless the property owner and the property owner's <br/>
<a id="pl.200.6"></a><var>200.6</var>spouse file with the assessor an affidavit or other proof required by the assessor stating that <br/>
<a id="pl.200.7"></a><var>200.7</var>the property qualifies as a homestead under subdivision 1, paragraph (e).<br/>
<a id="pl.200.8"></a><var>200.8</var>    Owners or spouses occupying residences owned by their spouses and previously <br/>
<a id="pl.200.9"></a><var>200.9</var>occupied with the other spouse, either of whom fail to include the other spouse's name <br/>
<a id="pl.200.10"></a><var>200.10</var>and Social Security number on the homestead application or provide the affidavits or <br/>
<a id="pl.200.11"></a><var>200.11</var>other proof requested, will be deemed to have elected to receive only partial homestead <br/>
<a id="pl.200.12"></a><var>200.12</var>treatment of their residence. The remainder of the residence will be classified as <br/>
<a id="pl.200.13"></a><var>200.13</var>nonhomestead residential. When an owner or spouse's name and Social Security number <br/>
<a id="pl.200.14"></a><var>200.14</var>appear on homestead applications for two separate residences and only one application is <br/>
<a id="pl.200.15"></a><var>200.15</var>signed, the owner or spouse will be deemed to have elected to homestead the residence for <br/>
<a id="pl.200.16"></a><var>200.16</var>which the application was signed.<br/>
<a id="pl.200.17"></a><var>200.17</var>    The Social Security numbers or affidavits or other proofs of the property owners <br/>
<a id="pl.200.18"></a><var>200.18</var>and spouses, and the federal income tax schedule F required by this section, are private <br/>
<a id="pl.200.19"></a><var>200.19</var>data on individuals as defined by section 
         <statute_ref>13.02, subdivision 12</statute_ref>, but, notwithstanding <br/>
<a id="pl.200.20"></a><var>200.20</var>that section, the private data may be disclosed to the commissioner of revenue, or, for <br/>
<a id="pl.200.21"></a><var>200.21</var>purposes of proceeding under the Revenue Recapture Act to recover personal property <br/>
<a id="pl.200.22"></a><var>200.22</var>taxes owing, to the county treasurer.<br/>
<a id="pl.200.23"></a><var>200.23</var>    (d) If residential real estate is occupied and used for purposes of a homestead by a <br/>
<a id="pl.200.24"></a><var>200.24</var>relative of the owner and qualifies for a homestead under subdivision 1, paragraph (c), in <br/>
<a id="pl.200.25"></a><var>200.25</var>order for the property to receive homestead status, a homestead application must be filed <br/>
<a id="pl.200.26"></a><var>200.26</var>with the assessor. The Social Security number of each relative and spouse of a relative <br/>
<a id="pl.200.27"></a><var>200.27</var>occupying the property and the Social Security number of each owner who is related to an <br/>
<a id="pl.200.28"></a><var>200.28</var>occupant of the property shall be required on the homestead application filed under this <br/>
<a id="pl.200.29"></a><var>200.29</var>subdivision. If a different relative of the owner subsequently occupies the property, the <br/>
<a id="pl.200.30"></a><var>200.30</var>owner of the property must notify the assessor within 30 days of the change in occupancy. <br/>
<a id="pl.200.31"></a><var>200.31</var>The Social Security number of a relative or relative's spouse occupying the property <br/>
<a id="pl.200.32"></a><var>200.32</var>is private data on individuals as defined by section 
         <statute_ref>13.02, subdivision 12</statute_ref>, but may be <br/>
<a id="pl.200.33"></a><var>200.33</var>disclosed to the commissioner of revenue, or, for the purposes of proceeding under the <br/>
<a id="pl.200.34"></a><var>200.34</var>Revenue Recapture Act to recover personal property taxes owing, to the county treasurer.<br/>
<a id="pl.200.35"></a><var>200.35</var>    (e) The homestead application shall also notify the property owners that the <br/>
<a id="pl.200.36"></a><var>200.36</var>application filed under this section will not be mailed annually and that if the property <br/>
<a id="pl.201.1"></a><var>201.1</var>is granted homestead status for the 1993 assessment, or any assessment year thereafter, <br/>
<a id="pl.201.2"></a><var>201.2</var>that same property shall remain classified as homestead until the property is sold or <br/>
<a id="pl.201.3"></a><var>201.3</var>transferred to another person, or the owners, the spouse of the owner, or the relatives no <br/>
<a id="pl.201.4"></a><var>201.4</var>longer use the property as their homestead. Upon the sale or transfer of the homestead <br/>
<a id="pl.201.5"></a><var>201.5</var>property, a certificate of value must be timely filed with the county auditor as provided <br/>
<a id="pl.201.6"></a><var>201.6</var>under section 
         <statute_ref>272.115</statute_ref>. Failure to notify the assessor within 30 days that the property has <br/>
<a id="pl.201.7"></a><var>201.7</var>been sold, transferred, or that the owner, the spouse of the owner, or the relative is no <br/>
<a id="pl.201.8"></a><var>201.8</var>longer occupying the property as a homestead, shall result in the penalty provided under <br/>
<a id="pl.201.9"></a><var>201.9</var>this subdivision and the property will lose its current homestead status.<br/>
<a id="pl.201.10"></a><var>201.10</var>    (f) If the homestead application is not returned within 30 days, the county will send a <br/>
<a id="pl.201.11"></a><var>201.11</var>second application to the present owners of record. The notice of proposed property taxes <br/>
<a id="pl.201.12"></a><var>201.12</var>prepared under section 
         <statute_ref>275.065, subdivision 3</statute_ref>, shall reflect the property's classification. <br/>
<a id="pl.201.13"></a><var>201.13</var>Beginning with assessment year 1993 for all properties, If a homestead application has <br/>
<a id="pl.201.14"></a><var>201.14</var>not been filed with the county by December 15, the assessor shall classify the property <br/>
<a id="pl.201.15"></a><var>201.15</var>as nonhomestead for the current assessment year for taxes payable in the following year, <br/>
<a id="pl.201.16"></a><var>201.16</var>provided that the owner may be entitled to receive the homestead classification by proper <br/>
<a id="pl.201.17"></a><var>201.17</var>application under section 
         <statute_ref>375.192</statute_ref>.<br/>
<a id="pl.201.18"></a><var>201.18</var>    (g) At the request of the commissioner, each county must give the commissioner a <br/>
<a id="pl.201.19"></a><var>201.19</var>list that includes the name and Social Security number of each occupant of homestead <br/>
<a id="pl.201.20"></a><var>201.20</var>property who is the property owner and the, property owner's spouse occupying the <br/>
<a id="pl.201.21"></a><var>201.21</var>property, or, qualifying relative of a property owner, applying for homestead classification <br/>
<a id="pl.201.22"></a><var>201.22</var>under this subdivision or a spouse of a qualifying relative. The commissioner shall use the <br/>
<a id="pl.201.23"></a><var>201.23</var>information provided on the lists as appropriate under the law, including for the detection <br/>
<a id="pl.201.24"></a><var>201.24</var>of improper claims by owners, or relatives of owners, under chapter 290A.<br/>
<a id="pl.201.25"></a><var>201.25</var>    (h) If the commissioner finds that a property owner may be claiming a fraudulent <br/>
<a id="pl.201.26"></a><var>201.26</var>homestead, the commissioner shall notify the appropriate counties. Within 90 days of <br/>
<a id="pl.201.27"></a><var>201.27</var>the notification, the county assessor shall investigate to determine if the homestead <br/>
<a id="pl.201.28"></a><var>201.28</var>classification was properly claimed. If the property owner does not qualify, the county <br/>
<a id="pl.201.29"></a><var>201.29</var>assessor shall notify the county auditor who will determine the amount of homestead <br/>
<a id="pl.201.30"></a><var>201.30</var>benefits that had been improperly allowed. For the purpose of this section, "homestead <br/>
<a id="pl.201.31"></a><var>201.31</var>benefits" means the tax reduction resulting from the classification as a homestead under <br/>
<a id="pl.201.32"></a><var>201.32</var>section 
         <statute_ref>273.13</statute_ref>, the taconite homestead credit under section 
         <statute_ref>273.135</statute_ref>, the residential <br/>
<a id="pl.201.33"></a><var>201.33</var>homestead and agricultural homestead credits under section 
         <statute_ref>273.1384</statute_ref>, and the <br/>
<a id="pl.201.34"></a><var>201.34</var>supplemental homestead credit under section 
         <statute_ref>273.1391</statute_ref>.<br/>
<a id="pl.201.35"></a><var>201.35</var>    The county auditor shall send a notice to the person who owned the affected property <br/>
<a id="pl.201.36"></a><var>201.36</var>at the time the homestead application related to the improper homestead was filed, <br/>
<a id="pl.202.1"></a><var>202.1</var>demanding reimbursement of the homestead benefits plus a penalty equal to 100 percent <br/>
<a id="pl.202.2"></a><var>202.2</var>of the homestead benefits. The person notified may appeal the county's determination <br/>
<a id="pl.202.3"></a><var>202.3</var>by serving copies of a petition for review with county officials as provided in section <br/>
<statute_ref><a id="pl.202.4"></a><var>202.4</var>278.01
         </statute_ref> and filing proof of service as provided in section 
         <statute_ref>278.01</statute_ref> with the Minnesota Tax <br/>
<a id="pl.202.5"></a><var>202.5</var>Court within 60 days of the date of the notice from the county. Procedurally, the appeal <br/>
<a id="pl.202.6"></a><var>202.6</var>is governed by the provisions in chapter 271 which apply to the appeal of a property tax <br/>
<a id="pl.202.7"></a><var>202.7</var>assessment or levy, but without requiring any prepayment of the amount in controversy. If <br/>
<a id="pl.202.8"></a><var>202.8</var>the amount of homestead benefits and penalty is not paid within 60 days, and if no appeal <br/>
<a id="pl.202.9"></a><var>202.9</var>has been filed, the county auditor shall certify the amount of taxes and penalty to the county <br/>
<a id="pl.202.10"></a><var>202.10</var>treasurer. The county treasurer will add interest to the unpaid homestead benefits and <br/>
<a id="pl.202.11"></a><var>202.11</var>penalty amounts at the rate provided in section 
         <statute_ref>279.03</statute_ref> for real property taxes becoming <br/>
<a id="pl.202.12"></a><var>202.12</var>delinquent in the calendar year during which the amount remains unpaid. Interest may be <br/>
<a id="pl.202.13"></a><var>202.13</var>assessed for the period beginning 60 days after demand for payment was made.<br/>
<a id="pl.202.14"></a><var>202.14</var>    If the person notified is the current owner of the property, the treasurer may add the <br/>
<a id="pl.202.15"></a><var>202.15</var>total amount of homestead benefits, penalty, interest, and costs to the ad valorem taxes <br/>
<a id="pl.202.16"></a><var>202.16</var>otherwise payable on the property by including the amounts on the property tax statements <br/>
<a id="pl.202.17"></a><var>202.17</var>under section 
         <statute_ref>276.04, subdivision 3</statute_ref>. The amounts added under this paragraph to the ad <br/>
<a id="pl.202.18"></a><var>202.18</var>valorem taxes shall include interest accrued through December 31 of the year preceding <br/>
<a id="pl.202.19"></a><var>202.19</var>the taxes payable year for which the amounts are first added. These amounts, when added <br/>
<a id="pl.202.20"></a><var>202.20</var>to the property tax statement, become subject to all the laws for the enforcement of real or <br/>
<a id="pl.202.21"></a><var>202.21</var>personal property taxes for that year, and for any subsequent year.<br/>
<a id="pl.202.22"></a><var>202.22</var>    If the person notified is not the current owner of the property, the treasurer may <br/>
<a id="pl.202.23"></a><var>202.23</var>collect the amounts due under the Revenue Recapture Act in chapter 270A, or use any of <br/>
<a id="pl.202.24"></a><var>202.24</var>the powers granted in sections 
         <statute_ref>277.20</statute_ref> and 
         <statute_ref>277.21</statute_ref> without exclusion, to enforce payment <br/>
<a id="pl.202.25"></a><var>202.25</var>of the homestead benefits, penalty, interest, and costs, as if those amounts were delinquent <br/>
<a id="pl.202.26"></a><var>202.26</var>tax obligations of the person who owned the property at the time the application related <br/>
<a id="pl.202.27"></a><var>202.27</var>to the improperly allowed homestead was filed. The treasurer may relieve a prior owner <br/>
<a id="pl.202.28"></a><var>202.28</var>of personal liability for the homestead benefits, penalty, interest, and costs, and instead <br/>
<a id="pl.202.29"></a><var>202.29</var>extend those amounts on the tax lists against the property as provided in this paragraph <br/>
<a id="pl.202.30"></a><var>202.30</var>to the extent that the current owner agrees in writing. On all demands, billings, property <br/>
<a id="pl.202.31"></a><var>202.31</var>tax statements, and related correspondence, the county must list and state separately the <br/>
<a id="pl.202.32"></a><var>202.32</var>amounts of homestead benefits, penalty, interest and costs being demanded, billed or <br/>
<a id="pl.202.33"></a><var>202.33</var>assessed.<br/>
<a id="pl.202.34"></a><var>202.34</var>    (i) Any amount of homestead benefits recovered by the county from the property <br/>
<a id="pl.202.35"></a><var>202.35</var>owner shall be distributed to the county, city or town, and school district where the <br/>
<a id="pl.202.36"></a><var>202.36</var>property is located in the same proportion that each taxing district's levy was to the total <br/>
<a id="pl.203.1"></a><var>203.1</var>of the three taxing districts' levy for the current year. Any amount recovered attributable <br/>
<a id="pl.203.2"></a><var>203.2</var>to taconite homestead credit shall be transmitted to the St. Louis County auditor to be <br/>
<a id="pl.203.3"></a><var>203.3</var>deposited in the taconite property tax relief account. Any amount recovered that is <br/>
<a id="pl.203.4"></a><var>203.4</var>attributable to supplemental homestead credit is to be transmitted to the commissioner of <br/>
<a id="pl.203.5"></a><var>203.5</var>revenue for deposit in the general fund of the state treasury. The total amount of penalty <br/>
<a id="pl.203.6"></a><var>203.6</var>collected must be deposited in the county general fund.<br/>
<a id="pl.203.7"></a><var>203.7</var>    (j) If a property owner has applied for more than one homestead and the county <br/>
<a id="pl.203.8"></a><var>203.8</var>assessors cannot determine which property should be classified as homestead, the county <br/>
<a id="pl.203.9"></a><var>203.9</var>assessors will refer the information to the commissioner. The commissioner shall make <br/>
<a id="pl.203.10"></a><var>203.10</var>the determination and notify the counties within 60 days.<br/>
<a id="pl.203.11"></a><var>203.11</var>    (k) In addition to lists of homestead properties, the commissioner may ask the <br/>
<a id="pl.203.12"></a><var>203.12</var>counties to furnish lists of all properties and the record owners. The Social Security <br/>
<a id="pl.203.13"></a><var>203.13</var>numbers and federal identification numbers that are maintained by a county or city <br/>
<a id="pl.203.14"></a><var>203.14</var>assessor for property tax administration purposes, and that may appear on the lists retain <br/>
<a id="pl.203.15"></a><var>203.15</var>their classification as private or nonpublic data; but may be viewed, accessed, and used by <br/>
<a id="pl.203.16"></a><var>203.16</var>the county auditor or treasurer of the same county for the limited purpose of assisting the <br/>
<a id="pl.203.17"></a><var>203.17</var>commissioner in the preparation of microdata samples under section 
         <statute_ref>270C.12</statute_ref>.<br/>
<a id="pl.203.18"></a><var>203.18</var>    (l) On or before April 30 each year beginning in 2007, each county must provide the <br/>
<a id="pl.203.19"></a><var>203.19</var>commissioner with the following data for each parcel of homestead property by electronic <br/>
<a id="pl.203.20"></a><var>203.20</var>means as defined in section 
         <statute_ref>289A.02, subdivision 8</statute_ref>:<br/>
<a id="pl.203.21"></a><var>203.21</var>    (i) the property identification number assigned to the parcel for purposes of taxes <br/>
<a id="pl.203.22"></a><var>203.22</var>payable in the current year;<br/>
<a id="pl.203.23"></a><var>203.23</var>    (ii) the name and Social Security number of each occupant of homestead property <br/>
<a id="pl.203.24"></a><var>203.24</var>who is the property owner and, property owner's spouse, as shown on the tax rolls for the <br/>
<a id="pl.203.25"></a><var>203.25</var>current and the prior assessment year qualifying relative of a property owner, or spouse <br/>
<a id="pl.203.26"></a><var>203.26</var>of a qualifying relative;<br/>
<a id="pl.203.27"></a><var>203.27</var>    (iii) the classification of the property under section 
         <statute_ref>273.13</statute_ref> for taxes payable in the <br/>
<a id="pl.203.28"></a><var>203.28</var>current year and in the prior year;<br/>
<a id="pl.203.29"></a><var>203.29</var>    (iv) an indication of whether the property was classified as a homestead for taxes <br/>
<a id="pl.203.30"></a><var>203.30</var>payable in the current year or for taxes payable in the prior year because of occupancy by <br/>
<a id="pl.203.31"></a><var>203.31</var>a relative of the owner or by a spouse of a relative;<br/>
<a id="pl.203.32"></a><var>203.32</var>    (v) the property taxes payable as defined in section 
         <statute_ref>290A.03, subdivision 13</statute_ref>, for the <br/>
<a id="pl.203.33"></a><var>203.33</var>current year and the prior year;<br/>
<a id="pl.203.34"></a><var>203.34</var>    (vi) the market value of improvements to the property first assessed for tax purposes <br/>
<a id="pl.203.35"></a><var>203.35</var>for taxes payable in the current year;<br/>
<a id="pl.204.1"></a><var>204.1</var>    (vii) the assessor's estimated market value assigned to the property for taxes payable <br/>
<a id="pl.204.2"></a><var>204.2</var>in the current year and the prior year;<br/>
<a id="pl.204.3"></a><var>204.3</var>    (viii) the taxable market value assigned to the property for taxes payable in the <br/>
<a id="pl.204.4"></a><var>204.4</var>current year and the prior year;<br/>
<a id="pl.204.5"></a><var>204.5</var>    (ix) whether there are delinquent property taxes owing on the homestead;<br/>
<a id="pl.204.6"></a><var>204.6</var>    (x) the unique taxing district in which the property is located; and<br/>
<a id="pl.204.7"></a><var>204.7</var>    (xi) such other information as the commissioner decides is necessary.<br/>
<a id="pl.204.8"></a><var>204.8</var>    The commissioner shall use the information provided on the lists as appropriate <br/>
<a id="pl.204.9"></a><var>204.9</var>under the law, including for the detection of improper claims by owners, or relatives <br/>
<a id="pl.204.10"></a><var>204.10</var>of owners, under chapter 290A.<br/>
<a id="pl.204.11"></a><var>204.11</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.30.0"></a><a id="pl.204.12"></a><var>204.12</var>    Sec. 30. Minnesota Statutes 2006, section 273.1398, subdivision 4, is amended to read:<br/>
<a id="pl.204.13"></a><var>204.13</var>    Subd. 4. <b>Disparity reduction credit.</b> (a) Beginning with taxes payable in 1989, <br/>
<a id="pl.204.14"></a><var>204.14</var>class 4a, class 3a, and class 3b property qualifies for a disparity reduction credit if: (1) <br/>
<a id="pl.204.15"></a><var>204.15</var>the property is located in a border city that has an enterprise zone designated pursuant <br/>
<a id="pl.204.16"></a><var>204.16</var>to section 
         <statute_ref>469.168, subdivision 4</statute_ref>; (2) the property is located in a city with a population <br/>
<a id="pl.204.17"></a><var>204.17</var>greater than 2,500 and less than 35,000 according to the 1980 decennial census; (3) the <br/>
<a id="pl.204.18"></a><var>204.18</var>city is adjacent to a city in another state or immediately adjacent to a city adjacent to a city <br/>
<a id="pl.204.19"></a><var>204.19</var>in another state; and (4) the adjacent city in the other state has a population of greater than <br/>
<a id="pl.204.20"></a><var>204.20</var>5,000 and less than 75,000 according to the 1980 decennial census. <br/>
<a id="pl.204.21"></a><var>204.21</var>    (b) The credit is an amount sufficient to reduce (i) the taxes levied on class 4a <br/>
<a id="pl.204.22"></a><var>204.22</var>property to 2.3 percent of the property's market value and (ii) the tax on class 3a and class <br/>
<a id="pl.204.23"></a><var>204.23</var>3b property to 2.3 percent of market value.<br/>
<a id="pl.204.24"></a><var>204.24</var>    (c) The county auditor shall annually certify the costs of the credits to the <br/>
<a id="pl.204.25"></a><var>204.25</var>Department of Revenue. The department shall reimburse local governments for the <br/>
<a id="pl.204.26"></a><var>204.26</var>property taxes foregone as the result of the credits in proportion to their total levies.<br/>
<a id="pl.204.27"></a><var>204.27</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for taxes payable in <br/>
<a id="pl.204.28"></a><var>204.28</var>2001 and thereafter.<br/>
<br/>
<a id="bill.13.31.0"></a><a id="pl.204.29"></a><var>204.29</var>    Sec. 31. Minnesota Statutes 2006, section 273.33, subdivision 2, is amended to read:<br/>
<a id="pl.204.30"></a><var>204.30</var>    Subd. 2. <b>Listing and assessment by commissioner.</b> The personal property, <br/>
<a id="pl.204.31"></a><var>204.31</var>consisting of the pipeline system of mains, pipes, and equipment attached thereto, of <br/>
<a id="pl.204.32"></a><var>204.32</var>pipeline companies and others engaged in the operations or business of transporting <br/>
<a id="pl.204.33"></a><var>204.33</var>natural gas, gasoline, crude oil, or other petroleum products by pipelines, shall be listed <br/>
<a id="pl.205.1"></a><var>205.1</var>with and assessed by the commissioner of revenue and the values provided to the city <br/>
<a id="pl.205.2"></a><var>205.2</var>or county assessor by order. This subdivision shall not apply to the assessment of <br/>
<a id="pl.205.3"></a><var>205.3</var>the products transported through the pipelines nor to the lines of local commercial gas <br/>
<a id="pl.205.4"></a><var>205.4</var>companies engaged primarily in the business of distributing gas to consumers at retail nor <br/>
<a id="pl.205.5"></a><var>205.5</var>to pipelines used by the owner thereof to supply natural gas or other petroleum products <br/>
<a id="pl.205.6"></a><var>205.6</var>exclusively for such owner's own consumption and not for resale to others. If more than <br/>
<a id="pl.205.7"></a><var>205.7</var>85 percent of the natural gas or other petroleum products actually transported over the <br/>
<a id="pl.205.8"></a><var>205.8</var>pipeline is used for the owner's own consumption and not for resale to others, then this <br/>
<a id="pl.205.9"></a><var>205.9</var>subdivision shall not apply; provided, however, that in that event, the pipeline shall be <br/>
<a id="pl.205.10"></a><var>205.10</var>assessed in proportion to the percentage of gas actually transported over such pipeline that <br/>
<a id="pl.205.11"></a><var>205.11</var>is not used for the owner's own consumption. On or before June 30, the commissioner <br/>
<a id="pl.205.12"></a><var>205.12</var>shall certify to the auditor of each county, the amount of such personal property assessment <br/>
<a id="pl.205.13"></a><var>205.13</var>against each company in each district in which such property is located.<br/>
<a id="pl.205.14"></a><var>205.14</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.32.0"></a><a id="pl.205.15"></a><var>205.15</var>    Sec. 32. Minnesota Statutes 2006, section 273.37, subdivision 2, is amended to read:<br/>
<a id="pl.205.16"></a><var>205.16</var>    Subd. 2. <b>Listing and assessment by commissioner.</b> Transmission lines of less <br/>
<a id="pl.205.17"></a><var>205.17</var>than 69 kv, transmission lines of 69 kv and above located in an unorganized township, <br/>
<a id="pl.205.18"></a><var>205.18</var>and distribution lines, and equipment attached thereto, having a fixed situs outside the <br/>
<a id="pl.205.19"></a><var>205.19</var>corporate limits of cities except distribution lines taxed as provided in sections 
         <statute_ref>273.40</statute_ref> <br/>
<a id="pl.205.20"></a><var>205.20</var>and 
         <statute_ref>273.41</statute_ref>, shall be listed with and assessed by the commissioner of revenue in the <br/>
<a id="pl.205.21"></a><var>205.21</var>county where situated and the values provided to the city or county assessor by order. <br/>
<a id="pl.205.22"></a><var>205.22</var>The commissioner shall assess such property at the percentage of market value fixed by <br/>
<a id="pl.205.23"></a><var>205.23</var>law; and, on or before June 30, shall certify to the auditor of each county in which such <br/>
<a id="pl.205.24"></a><var>205.24</var>property is located the amount of the assessment made against each company and person <br/>
<a id="pl.205.25"></a><var>205.25</var>owning such property. <br/>
<a id="pl.205.26"></a><var>205.26</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.33.0"></a><a id="pl.205.27"></a><var>205.27</var>    Sec. 33. Minnesota Statutes 2006, section 273.371, subdivision 1, is amended to read:<br/>
<a id="pl.205.28"></a><var>205.28</var>    Subdivision 1. <b>Report required.</b> Every electric light, power, gas, water, express, <br/>
<a id="pl.205.29"></a><var>205.29</var>stage, and transportation company and pipeline doing business in Minnesota shall <br/>
<a id="pl.205.30"></a><var>205.30</var>annually file with the commissioner on or before March 31 a report under oath setting <br/>
<a id="pl.205.31"></a><var>205.31</var>forth the information prescribed by the commissioner to enable the commissioner to make <br/>
<a id="pl.205.32"></a><var>205.32</var>valuations, recommended valuations, and equalization required under sections 
         <statute_ref>273.33</statute_ref>, <br/>
<statute_ref><a id="pl.205.33"></a><var>205.33</var>273.35
         </statute_ref>, 
         <statute_ref>273.36</statute_ref>, and
<statute_ref>273.37</statute_ref>, and 273.3711. If all the required information is not available <br/>
<a id="pl.206.1"></a><var>206.1</var>on March 31, the company or pipeline shall file the information that is available on or <br/>
<a id="pl.206.2"></a><var>206.2</var>before March 31, and the balance of the information as soon as it becomes available. <br/>
<a id="pl.206.3"></a><var>206.3</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.34.0"></a><a id="pl.206.4"></a><var>206.4</var>    Sec. 34. <b>[273.3711] RECOMMENDED AND ORDERED VALUES.</b><br/>
<a id="pl.206.5"></a><var>206.5</var>    For purposes of sections 273.33, 273.35, 273.36, 273.37, 273.371, and 273.372, <br/>
<a id="pl.206.6"></a><var>206.6</var>all values not required to be listed and assessed by the commissioner of revenue are <br/>
<a id="pl.206.7"></a><var>206.7</var>recommended values.<br/>
<a id="pl.206.8"></a><var>206.8</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.35.0"></a><a id="pl.206.9"></a><var>206.9</var>    Sec. 35. Minnesota Statutes 2006, section 274.01, subdivision 1, is amended to read:<br/>
<a id="pl.206.10"></a><var>206.10</var>    Subdivision 1. <b>Ordinary board; meetings, deadlines, grievances.</b> (a) The town <br/>
<a id="pl.206.11"></a><var>206.11</var>board of a town, or the council or other governing body of a city, is the board of appeal <br/>
<a id="pl.206.12"></a><var>206.12</var>and equalization except (1) in cities whose charters provide for a board of equalization or <br/>
<a id="pl.206.13"></a><var>206.13</var>(2) in any city or town that has transferred its local board of review power and duties to <br/>
<a id="pl.206.14"></a><var>206.14</var>the county board as provided in subdivision 3. The county assessor shall fix a day and <br/>
<a id="pl.206.15"></a><var>206.15</var>time when the board or the board of equalization shall meet in the assessment districts <br/>
<a id="pl.206.16"></a><var>206.16</var>of the county. Notwithstanding any law or city charter to the contrary, a city board of <br/>
<a id="pl.206.17"></a><var>206.17</var>equalization shall be referred to as a board of appeal and equalization. On or before <br/>
<a id="pl.206.18"></a><var>206.18</var>February 15 of each year the assessor shall give written notice of the time to the city or <br/>
<a id="pl.206.19"></a><var>206.19</var>town clerk. Notwithstanding the provisions of any charter to the contrary, the meetings <br/>
<a id="pl.206.20"></a><var>206.20</var>must be held between April 1 and May 31 each year. The clerk shall give published and <br/>
<a id="pl.206.21"></a><var>206.21</var>posted notice of the meeting at least ten days before the date of the meeting.<br/>
<a id="pl.206.22"></a><var>206.22</var>    The board shall meet at the office of the clerk to review the assessment and <br/>
<a id="pl.206.23"></a><var>206.23</var>classification of property in the town or city. No changes in valuation or classification <br/>
<a id="pl.206.24"></a><var>206.24</var>which are intended to correct errors in judgment by the county assessor may be made by <br/>
<a id="pl.206.25"></a><var>206.25</var>the county assessor after the board has adjourned in those cities or towns that hold a <br/>
<a id="pl.206.26"></a><var>206.26</var>local board of review; however, corrections of errors that are merely clerical in nature or <br/>
<a id="pl.206.27"></a><var>206.27</var>changes that extend homestead treatment to property are permitted after adjournment until <br/>
<a id="pl.206.28"></a><var>206.28</var>the tax extension date for that assessment year. The changes must be fully documented and <br/>
<a id="pl.206.29"></a><var>206.29</var>maintained in the assessor's office and must be available for review by any person. A copy <br/>
<a id="pl.206.30"></a><var>206.30</var>of the changes made during this period in those cities or towns that hold a local board of <br/>
<a id="pl.206.31"></a><var>206.31</var>review must be sent to the county board no later than December 31 of the assessment year.<br/>
<a id="pl.206.32"></a><var>206.32</var>    (b) The board shall determine whether the taxable property in the town or city has <br/>
<a id="pl.206.33"></a><var>206.33</var>been properly placed on the list and properly valued by the assessor. If real or personal <br/>
<a id="pl.207.1"></a><var>207.1</var>property has been omitted, the board shall place it on the list with its market value, and <br/>
<a id="pl.207.2"></a><var>207.2</var>correct the assessment so that each tract or lot of real property, and each article, parcel, <br/>
<a id="pl.207.3"></a><var>207.3</var>or class of personal property, is entered on the assessment list at its market value. No <br/>
<a id="pl.207.4"></a><var>207.4</var>assessment of the property of any person may be raised unless the person has been <br/>
<a id="pl.207.5"></a><var>207.5</var>duly notified of the intent of the board to do so. On application of any person feeling <br/>
<a id="pl.207.6"></a><var>207.6</var>aggrieved, the board shall review the assessment or classification, or both, and correct <br/>
<a id="pl.207.7"></a><var>207.7</var>it as appears just. The board may not make an individual market value adjustment or <br/>
<a id="pl.207.8"></a><var>207.8</var>classification change that would benefit the property if the owner or other person having <br/>
<a id="pl.207.9"></a><var>207.9</var>control over the property has refused the assessor access to inspect the property and the <br/>
<a id="pl.207.10"></a><var>207.10</var>interior of any buildings or structures as provided in section 
         <statute_ref>273.20</statute_ref>. A board member <br/>
<a id="pl.207.11"></a><var>207.11</var>shall not participate in any actions of the board which result in market value adjustments <br/>
<a id="pl.207.12"></a><var>207.12</var>or classification changes to property owned by the board member, the spouse, parent, <br/>
<a id="pl.207.13"></a><var>207.13</var>stepparent, child, stepchild, grandparent, grandchild, brother, sister, uncle, aunt, nephew, <br/>
<a id="pl.207.14"></a><var>207.14</var>or niece of a board member, or property in which a board member has a financial interest. <br/>
<a id="pl.207.15"></a><var>207.15</var>The relationship may be by blood or marriage.<br/>
<a id="pl.207.16"></a><var>207.16</var>    (c) A local board may reduce assessments upon petition of the taxpayer but the total <br/>
<a id="pl.207.17"></a><var>207.17</var>reductions must not reduce the aggregate assessment made by the county assessor by more <br/>
<a id="pl.207.18"></a><var>207.18</var>than one percent. If the total reductions would lower the aggregate assessments made by <br/>
<a id="pl.207.19"></a><var>207.19</var>the county assessor by more than one percent, none of the adjustments may be made. The <br/>
<a id="pl.207.20"></a><var>207.20</var>assessor shall correct any clerical errors or double assessments discovered by the board <br/>
<a id="pl.207.21"></a><var>207.21</var>without regard to the one percent limitation.<br/>
<a id="pl.207.22"></a><var>207.22</var>    (d) A local board does not have authority to grant an exemption or to order property <br/>
<a id="pl.207.23"></a><var>207.23</var>removed from the tax rolls.<br/>
<a id="pl.207.24"></a><var>207.24</var>    (e) A majority of the members may act at the meeting, and adjourn from day to day <br/>
<a id="pl.207.25"></a><var>207.25</var>until they finish hearing the cases presented. The assessor shall attend, with the assessment <br/>
<a id="pl.207.26"></a><var>207.26</var>books and papers, and take part in the proceedings, but must not vote. The county assessor, <br/>
<a id="pl.207.27"></a><var>207.27</var>or an assistant delegated by the county assessor shall attend the meetings. The board shall <br/>
<a id="pl.207.28"></a><var>207.28</var>list separately, on a form appended to the assessment book, all omitted property added <br/>
<a id="pl.207.29"></a><var>207.29</var>to the list by the board and all items of property increased or decreased, with the market <br/>
<a id="pl.207.30"></a><var>207.30</var>value of each item of property, added or changed by the board, placed opposite the item. <br/>
<a id="pl.207.31"></a><var>207.31</var>The county assessor shall enter all changes made by the board in the assessment book.<br/>
<a id="pl.207.32"></a><var>207.32</var>    (f) Except as provided in subdivision 3, if a person fails to appear in person, by <br/>
<a id="pl.207.33"></a><var>207.33</var>counsel, or by written communication before the board after being duly notified of the <br/>
<a id="pl.207.34"></a><var>207.34</var>board's intent to raise the assessment of the property, or if a person feeling aggrieved by an <br/>
<a id="pl.207.35"></a><var>207.35</var>assessment or classification fails to apply for a review of the assessment or classification, <br/>
<a id="pl.207.36"></a><var>207.36</var>the person may not appear before the county board of appeal and equalization for a review <br/>
<a id="pl.208.1"></a><var>208.1</var>of the assessment or classification. This paragraph does not apply if an assessment was <br/>
<a id="pl.208.2"></a><var>208.2</var>made after the local board meeting, as provided in section 
         <statute_ref>273.01</statute_ref>, or if the person can <br/>
<a id="pl.208.3"></a><var>208.3</var>establish not having received notice of market value at least five days before the local <br/>
<a id="pl.208.4"></a><var>208.4</var>board meeting.<br/>
<a id="pl.208.5"></a><var>208.5</var>    (g) The local board must complete its work and adjourn within 20 days from the <br/>
<a id="pl.208.6"></a><var>208.6</var>time of convening stated in the notice of the clerk, unless a longer period is approved by <br/>
<a id="pl.208.7"></a><var>208.7</var>the commissioner of revenue. No action taken after that date is valid. All complaints <br/>
<a id="pl.208.8"></a><var>208.8</var>about an assessment or classification made after the meeting of the board must be heard <br/>
<a id="pl.208.9"></a><var>208.9</var>and determined by the county board of equalization. A nonresident may, at any time, <br/>
<a id="pl.208.10"></a><var>208.10</var>before the meeting of the board file written objections to an assessment or classification <br/>
<a id="pl.208.11"></a><var>208.11</var>with the county assessor. The objections must be presented to the board at its meeting by <br/>
<a id="pl.208.12"></a><var>208.12</var>the county assessor for its consideration.<br/>
<a id="pl.208.13"></a><var>208.13</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.36.0"></a><a id="pl.208.14"></a><var>208.14</var>    Sec. 36. Minnesota Statutes 2006, section 274.13, subdivision 1, is amended to read:<br/>
<a id="pl.208.15"></a><var>208.15</var>    Subdivision 1. <b>Members; meetings; rules for equalizing assessments.</b> The county <br/>
<a id="pl.208.16"></a><var>208.16</var>commissioners, or a majority of them, with the county auditor, or, if the auditor cannot be <br/>
<a id="pl.208.17"></a><var>208.17</var>present, the deputy county auditor, or, if there is no deputy, the court administrator of the <br/>
<a id="pl.208.18"></a><var>208.18</var>district court, shall form a board for the equalization of the assessment of the property <br/>
<a id="pl.208.19"></a><var>208.19</var>of the county, including the property of all cities whose charters provide for a board of <br/>
<a id="pl.208.20"></a><var>208.20</var>equalization. This board shall be referred to as the county board of appeal and equalization. <br/>
<a id="pl.208.21"></a><var>208.21</var>The board shall meet annually, on the date specified in section 
         <statute_ref>274.14</statute_ref>, at the office of the <br/>
<a id="pl.208.22"></a><var>208.22</var>auditor. Each member shall take an oath to fairly and impartially perform duties as a <br/>
<a id="pl.208.23"></a><var>208.23</var>member. Members shall not participate in any actions of the board which result in market <br/>
<a id="pl.208.24"></a><var>208.24</var>value adjustments or classification changes to property owned by the board member, the <br/>
<a id="pl.208.25"></a><var>208.25</var>spouse, parent, stepparent, child, stepchild, grandparent, grandchild, brother, sister, uncle, <br/>
<a id="pl.208.26"></a><var>208.26</var>aunt, nephew, or niece of a board member, or property in which a board member has a <br/>
<a id="pl.208.27"></a><var>208.27</var>financial interest. The relationship may be by blood or marriage. The board shall examine <br/>
<a id="pl.208.28"></a><var>208.28</var>and compare the returns of the assessment of property of the towns or districts, and <br/>
<a id="pl.208.29"></a><var>208.29</var>equalize them so that each tract or lot of real property and each article or class of personal <br/>
<a id="pl.208.30"></a><var>208.30</var>property is entered on the assessment list at its market value, subject to the following rules: <br/>
<a id="pl.208.31"></a><var>208.31</var>    (1) The board shall raise the valuation of each tract or lot of real property which <br/>
<a id="pl.208.32"></a><var>208.32</var>in its opinion is returned below its market value to the sum believed to be its market <br/>
<a id="pl.208.33"></a><var>208.33</var>value. The board must first give notice of intention to raise the valuation to the person in <br/>
<a id="pl.208.34"></a><var>208.34</var>whose name it is assessed, if the person is a resident of the county. The notice must fix <br/>
<a id="pl.208.35"></a><var>208.35</var>a time and place for a hearing.<br/>
<a id="pl.209.1"></a><var>209.1</var>    (2) The board shall reduce the valuation of each tract or lot which in its opinion is <br/>
<a id="pl.209.2"></a><var>209.2</var>returned above its market value to the sum believed to be its market value.<br/>
<a id="pl.209.3"></a><var>209.3</var>    (3) The board shall raise the valuation of each class of personal property which <br/>
<a id="pl.209.4"></a><var>209.4</var>in its opinion is returned below its market value to the sum believed to be its market <br/>
<a id="pl.209.5"></a><var>209.5</var>value. It shall raise the aggregate value of the personal property of individuals, firms, or <br/>
<a id="pl.209.6"></a><var>209.6</var>corporations, when it believes that the aggregate valuation, as returned, is less than the <br/>
<a id="pl.209.7"></a><var>209.7</var>market value of the taxable personal property possessed by the individuals, firms, or <br/>
<a id="pl.209.8"></a><var>209.8</var>corporations, to the sum it believes to be the market value. The board must first give notice <br/>
<a id="pl.209.9"></a><var>209.9</var>to the persons of intention to do so. The notice must set a time and place for a hearing.<br/>
<a id="pl.209.10"></a><var>209.10</var>    (4) The board shall reduce the valuation of each class of personal property that <br/>
<a id="pl.209.11"></a><var>209.11</var>is returned above its market value to the sum it believes to be its market value. Upon <br/>
<a id="pl.209.12"></a><var>209.12</var>complaint of a party aggrieved, the board shall reduce the aggregate valuation of the <br/>
<a id="pl.209.13"></a><var>209.13</var>individual's personal property, or of any class of personal property for which the individual <br/>
<a id="pl.209.14"></a><var>209.14</var>is assessed, which in its opinion has been assessed at too large a sum, to the sum it believes <br/>
<a id="pl.209.15"></a><var>209.15</var>was the market value of the individual's personal property of that class.<br/>
<a id="pl.209.16"></a><var>209.16</var>    (5) The board must not reduce the aggregate value of all the property of its county, as <br/>
<a id="pl.209.17"></a><var>209.17</var>submitted to the county board of equalization, with the additions made by the auditor under <br/>
<a id="pl.209.18"></a><var>209.18</var>this chapter, by more than one percent of its whole valuation. The board may raise the <br/>
<a id="pl.209.19"></a><var>209.19</var>aggregate valuation of real property, and of each class of personal property, of the county, <br/>
<a id="pl.209.20"></a><var>209.20</var>or of any town or district of the county, when it believes it is below the market value of the <br/>
<a id="pl.209.21"></a><var>209.21</var>property, or class of property, to the aggregate amount it believes to be its market value.<br/>
<a id="pl.209.22"></a><var>209.22</var>    (6) The board shall change the classification of any property which in its opinion <br/>
<a id="pl.209.23"></a><var>209.23</var>is not properly classified.<br/>
<a id="pl.209.24"></a><var>209.24</var>    (7) The board does not have the authority to grant an exemption or to order property <br/>
<a id="pl.209.25"></a><var>209.25</var>removed from the tax rolls.<br/>
<a id="pl.209.26"></a><var>209.26</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.37.0"></a><a id="pl.209.27"></a><var>209.27</var>    Sec. 37. <b>[274.135] COUNTY BOARDS; APPEALS AND EQUALIZATION </b><br/>
<a id="pl.209.28"></a><var>209.28</var><b>COURSE AND MEETING REQUIREMENTS.</b><br/>
<a id="pl.209.29"></a><var>209.29</var>    Subdivision 1. <b>Handbook for county boards.</b> By no later than January 1, 2009, the <br/>
<a id="pl.209.30"></a><var>209.30</var>commissioner of revenue must develop a handbook detailing procedures, responsibilities, <br/>
<a id="pl.209.31"></a><var>209.31</var>and requirements for county boards of appeal and equalization. The handbook must <br/>
<a id="pl.209.32"></a><var>209.32</var>include, but need not be limited to, the role of the county board in the assessment process, <br/>
<a id="pl.209.33"></a><var>209.33</var>the legal and policy reasons for fair and impartial appeal and equalization hearings, county <br/>
<a id="pl.209.34"></a><var>209.34</var>board meeting procedures that foster fair and impartial assessment reviews and other best <br/>
<a id="pl.210.1"></a><var>210.1</var>practices recommendations, quorum requirements for county boards, and explanations <br/>
<a id="pl.210.2"></a><var>210.2</var>of alternate methods of appeal.<br/>
<a id="pl.210.3"></a><var>210.3</var>    Subd. 2. <b>Appeals and equalization course.</b> Beginning in 2009, and each year <br/>
<a id="pl.210.4"></a><var>210.4</var>thereafter, there must be at least one member at each meeting of a county board of appeal <br/>
<a id="pl.210.5"></a><var>210.5</var>and equalization who has attended an appeals and equalization course developed or <br/>
<a id="pl.210.6"></a><var>210.6</var>approved by the commissioner within the last four years, as certified by the commissioner. <br/>
<a id="pl.210.7"></a><var>210.7</var>The course may be offered in conjunction with a meeting of the Minnesota Association <br/>
<a id="pl.210.8"></a><var>210.8</var>of Assessment Officers. The course content must include, but need not be limited to, a <br/>
<a id="pl.210.9"></a><var>210.9</var>review of the handbook developed by the commissioner under subdivision 1.<br/>
<a id="pl.210.10"></a><var>210.10</var>    Subd. 3. <b>Proof of compliance; transfer of duties.</b> (a) Any county that <br/>
<a id="pl.210.11"></a><var>210.11</var>conducts county boards of appeal and equalization meetings must provide proof to the <br/>
<a id="pl.210.12"></a><var>210.12</var>commissioner by December 1, 2009, and each year thereafter, that it is in compliance <br/>
<a id="pl.210.13"></a><var>210.13</var>with the requirements of subdivision 2. Beginning in 2009, this notice must also verify <br/>
<a id="pl.210.14"></a><var>210.14</var>that there was a quorum of voting members at each meeting of the board of appeal and <br/>
<a id="pl.210.15"></a><var>210.15</var>equalization in the current year. A county that does not comply with these requirements <br/>
<a id="pl.210.16"></a><var>210.16</var>is deemed to have transferred its board of appeal and equalization powers to the special <br/>
<a id="pl.210.17"></a><var>210.17</var>board of equalization appointed pursuant to section 274.13, subdivision 2, beginning <br/>
<a id="pl.210.18"></a><var>210.18</var>with the following year's assessment and continuing unless the powers are reinstated <br/>
<a id="pl.210.19"></a><var>210.19</var>under paragraph (c). A county that does not comply with the requirements of subdivision <br/>
<a id="pl.210.20"></a><var>210.20</var>2 and has not appointed a special board of equalization shall appoint a special board of <br/>
<a id="pl.210.21"></a><var>210.21</var>equalization before the following year's assessment.<br/>
<a id="pl.210.22"></a><var>210.22</var>    (b) The county shall notify the taxpayers when the board of appeal and equalization <br/>
<a id="pl.210.23"></a><var>210.23</var>for a county has been transferred to the special board of equalization under this subdivision <br/>
<a id="pl.210.24"></a><var>210.24</var>and, prior to the meeting time of the special board of equalization, the county shall make <br/>
<a id="pl.210.25"></a><var>210.25</var>available to those taxpayers a procedure for a review of the assessments, including, but <br/>
<a id="pl.210.26"></a><var>210.26</var>not limited to, open book meetings. This alternate review process must take place in <br/>
<a id="pl.210.27"></a><var>210.27</var>April and May.<br/>
<a id="pl.210.28"></a><var>210.28</var>    (c) A county board whose powers are transferred to the special board of equalization <br/>
<a id="pl.210.29"></a><var>210.29</var>under this subdivision may be reinstated by resolution of the county board and upon proof <br/>
<a id="pl.210.30"></a><var>210.30</var>of compliance with the requirements of subdivision 2. The resolution and proofs must be <br/>
<a id="pl.210.31"></a><var>210.31</var>provided to the commissioner by December 1 in order to be effective for the following <br/>
<a id="pl.210.32"></a><var>210.32</var>year's assessment.<br/>
<a id="pl.210.33"></a><var>210.33</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.38.0"></a><a id="pl.210.34"></a><var>210.34</var>    Sec. 38. Minnesota Statutes 2007 Supplement, section 275.065, subdivision 3, is <br/>
<a id="pl.210.35"></a><var>210.35</var>amended to read:<br/>
<a id="pl.211.1"></a><var>211.1</var>    Subd. 3. <b>Notice of proposed property taxes.</b> (a) The county auditor shall prepare <br/>
<a id="pl.211.2"></a><var>211.2</var>and the county treasurer shall deliver after November 10 and on or before November 24 <br/>
<a id="pl.211.3"></a><var>211.3</var>each year, by first class mail to each taxpayer at the address listed on the county's current <br/>
<a id="pl.211.4"></a><var>211.4</var>year's assessment roll, a notice of proposed property taxes. Upon written request by <br/>
<a id="pl.211.5"></a><var>211.5</var>the taxpayer, the treasurer may send the notice in electronic form or by electronic mail <br/>
<a id="pl.211.6"></a><var>211.6</var>instead of on paper or by ordinary mail.<br/>
<a id="pl.211.7"></a><var>211.7</var>    (b) The commissioner of revenue shall prescribe the form of the notice.<br/>
<a id="pl.211.8"></a><var>211.8</var>    (c) The notice must inform taxpayers that it contains the amount of property taxes <br/>
<a id="pl.211.9"></a><var>211.9</var>each taxing authority proposes to collect for taxes payable the following year. In the case <br/>
<a id="pl.211.10"></a><var>211.10</var>of a town, or in the case of the state general tax, the final tax amount will be its proposed <br/>
<a id="pl.211.11"></a><var>211.11</var>tax. In the case of taxing authorities required to hold a public meeting under subdivision 6, <br/>
<a id="pl.211.12"></a><var>211.12</var>the notice must clearly state that each taxing authority, including regional library districts <br/>
<a id="pl.211.13"></a><var>211.13</var>established under section 
         <statute_ref>134.201</statute_ref>, and including the metropolitan taxing districts as <br/>
<a id="pl.211.14"></a><var>211.14</var>defined in paragraph (i), but excluding all other special taxing districts and towns, will <br/>
<a id="pl.211.15"></a><var>211.15</var>hold a public meeting to receive public testimony on the proposed budget and proposed or <br/>
<a id="pl.211.16"></a><var>211.16</var>final property tax levy, or, in case of a school district, on the current budget and proposed <br/>
<a id="pl.211.17"></a><var>211.17</var>property tax levy. It must clearly state the time and place of each taxing authority's <br/>
<a id="pl.211.18"></a><var>211.18</var>meeting, a telephone number for the taxing authority that taxpayers may call if they have <br/>
<a id="pl.211.19"></a><var>211.19</var>questions related to the notice, and an address where comments will be received by mail.<br/>
<a id="pl.211.20"></a><var>211.20</var>    (d) The notice must state for each parcel:<br/>
<a id="pl.211.21"></a><var>211.21</var>    (1) the market value of the property as determined under section 
         <statute_ref>273.11</statute_ref>, and used <br/>
<a id="pl.211.22"></a><var>211.22</var>for computing property taxes payable in the following year and for taxes payable in the <br/>
<a id="pl.211.23"></a><var>211.23</var>current year as each appears in the records of the county assessor on November 1 of the <br/>
<a id="pl.211.24"></a><var>211.24</var>current year; and, in the case of residential property, whether the property is classified as <br/>
<a id="pl.211.25"></a><var>211.25</var>homestead or nonhomestead. The notice must clearly inform taxpayers of the years to <br/>
<a id="pl.211.26"></a><var>211.26</var>which the market values apply and that the values are final values;<br/>
<a id="pl.211.27"></a><var>211.27</var>    (2) the items listed below, shown separately by county, city or town, and state general <br/>
<a id="pl.211.28"></a><var>211.28</var>tax, net of the residential and agricultural homestead credit under section 
         <statute_ref>273.1384</statute_ref>, voter <br/>
<a id="pl.211.29"></a><var>211.29</var>approved school levy, other local school levy, and the sum of the special taxing districts, <br/>
<a id="pl.211.30"></a><var>211.30</var>and as a total of all taxing authorities:<br/>
<a id="pl.211.31"></a><var>211.31</var>    (i) the actual tax for taxes payable in the current year; and<br/>
<a id="pl.211.32"></a><var>211.32</var>    (ii) the proposed tax amount.<br/>
<a id="pl.211.33"></a><var>211.33</var>    If the county levy under clause (2) includes an amount for a lake improvement <br/>
<a id="pl.211.34"></a><var>211.34</var>district as defined under sections 
         <statute_ref>103B.501</statute_ref> to 
         <statute_ref>103B.581</statute_ref>, the amount attributable for that <br/>
<a id="pl.211.35"></a><var>211.35</var>purpose must be separately stated from the remaining county levy amount.<br/>
<a id="pl.212.1"></a><var>212.1</var>    In the case of a town or the state general tax, the final tax shall also be its proposed <br/>
<a id="pl.212.2"></a><var>212.2</var>tax unless the town changes its levy at a special town meeting under section 
         <statute_ref>365.52</statute_ref>. If a <br/>
<a id="pl.212.3"></a><var>212.3</var>school district has certified under section 
         <statute_ref>126C.17, subdivision 9</statute_ref>, that a referendum will <br/>
<a id="pl.212.4"></a><var>212.4</var>be held in the school district at the November general election, the county auditor must <br/>
<a id="pl.212.5"></a><var>212.5</var>note next to the school district's proposed amount that a referendum is pending and that, if <br/>
<a id="pl.212.6"></a><var>212.6</var>approved by the voters, the tax amount may be higher than shown on the notice. In the <br/>
<a id="pl.212.7"></a><var>212.7</var>case of the city of Minneapolis, the levy for Minneapolis Park and Recreation shall be <br/>
<a id="pl.212.8"></a><var>212.8</var>listed separately from the remaining amount of the city's levy. In the case of the city of <br/>
<a id="pl.212.9"></a><var>212.9</var>St. Paul, the levy for the St. Paul Library Agency must be listed separately from the <br/>
<a id="pl.212.10"></a><var>212.10</var>remaining amount of the city's levy. In the case of Ramsey County, any amount levied <br/>
<a id="pl.212.11"></a><var>212.11</var>under section 
         <statute_ref>134.07</statute_ref> may be listed separately from the remaining amount of the county's <br/>
<a id="pl.212.12"></a><var>212.12</var>levy. In the case of a parcel where tax increment or the fiscal disparities areawide tax <br/>
<a id="pl.212.13"></a><var>212.13</var>under chapter 276A or 473F applies, the proposed tax levy on the captured value or the <br/>
<a id="pl.212.14"></a><var>212.14</var>proposed tax levy on the tax capacity subject to the areawide tax must each be stated <br/>
<a id="pl.212.15"></a><var>212.15</var>separately and not included in the sum of the special taxing districts; and<br/>
<a id="pl.212.16"></a><var>212.16</var>    (3) the increase or decrease between the total taxes payable in the current year and <br/>
<a id="pl.212.17"></a><var>212.17</var>the total proposed taxes, expressed as a percentage.<br/>
<a id="pl.212.18"></a><var>212.18</var>    For purposes of this section, the amount of the tax on homesteads qualifying under <br/>
<a id="pl.212.19"></a><var>212.19</var>the senior citizens' property tax deferral program under chapter 290B is the total amount <br/>
<a id="pl.212.20"></a><var>212.20</var>of property tax before subtraction of the deferred property tax amount.<br/>
<a id="pl.212.21"></a><var>212.21</var>    (e) The notice must clearly state that the proposed or final taxes do not include <br/>
<a id="pl.212.22"></a><var>212.22</var>the following:<br/>
<a id="pl.212.23"></a><var>212.23</var>    (1) special assessments;<br/>
<a id="pl.212.24"></a><var>212.24</var>    (2) levies approved by the voters after the date the proposed taxes are certified, <br/>
<a id="pl.212.25"></a><var>212.25</var>including bond referenda and school district levy referenda;<br/>
<a id="pl.212.26"></a><var>212.26</var>    (3) a levy limit increase approved by the voters by the first Tuesday after the first <br/>
<a id="pl.212.27"></a><var>212.27</var>Monday in November of the levy year as provided under section 
         <statute_ref>275.73</statute_ref>;<br/>
<a id="pl.212.28"></a><var>212.28</var>    (4) amounts necessary to pay cleanup or other costs due to a natural disaster <br/>
<a id="pl.212.29"></a><var>212.29</var>occurring after the date the proposed taxes are certified;<br/>
<a id="pl.212.30"></a><var>212.30</var>    (5) amounts necessary to pay tort judgments against the taxing authority that become <br/>
<a id="pl.212.31"></a><var>212.31</var>final after the date the proposed taxes are certified; and<br/>
<a id="pl.212.32"></a><var>212.32</var>    (6) the contamination tax imposed on properties which received market value <br/>
<a id="pl.212.33"></a><var>212.33</var>reductions for contamination.<br/>
<a id="pl.212.34"></a><var>212.34</var>    (f) Except as provided in subdivision 7, failure of the county auditor to prepare or <br/>
<a id="pl.212.35"></a><var>212.35</var>the county treasurer to deliver the notice as required in this section does not invalidate the <br/>
<a id="pl.212.36"></a><var>212.36</var>proposed or final tax levy or the taxes payable pursuant to the tax levy.<br/>
<a id="pl.213.1"></a><var>213.1</var>    (g) If the notice the taxpayer receives under this section lists the property as <br/>
<a id="pl.213.2"></a><var>213.2</var>nonhomestead, and satisfactory documentation is provided to the county assessor by the <br/>
<a id="pl.213.3"></a><var>213.3</var>applicable deadline, and the property qualifies for the homestead classification in that <br/>
<a id="pl.213.4"></a><var>213.4</var>assessment year, the assessor shall reclassify the property to homestead for taxes payable <br/>
<a id="pl.213.5"></a><var>213.5</var>in the following year.<br/>
<a id="pl.213.6"></a><var>213.6</var>    (h) In the case of class 4 residential property used as a residence for lease or rental <br/>
<a id="pl.213.7"></a><var>213.7</var>periods of 30 days or more, the taxpayer must either:<br/>
<a id="pl.213.8"></a><var>213.8</var>    (1) mail or deliver a copy of the notice of proposed property taxes to each tenant, <br/>
<a id="pl.213.9"></a><var>213.9</var>renter, or lessee; or<br/>
<a id="pl.213.10"></a><var>213.10</var>    (2) post a copy of the notice in a conspicuous place on the premises of the property.<br/>
<a id="pl.213.11"></a><var>213.11</var>    The notice must be mailed or posted by the taxpayer by November 27 or within <br/>
<a id="pl.213.12"></a><var>213.12</var>three days of receipt of the notice, whichever is later. A taxpayer may notify the county <br/>
<a id="pl.213.13"></a><var>213.13</var>treasurer of the address of the taxpayer, agent, caretaker, or manager of the premises to <br/>
<a id="pl.213.14"></a><var>213.14</var>which the notice must be mailed in order to fulfill the requirements of this paragraph.<br/>
<a id="pl.213.15"></a><var>213.15</var>    (i) For purposes of this subdivision, subdivisions 5a and 6, "metropolitan special <br/>
<a id="pl.213.16"></a><var>213.16</var>taxing districts" means the following taxing districts in the seven-county metropolitan area <br/>
<a id="pl.213.17"></a><var>213.17</var>that levy a property tax for any of the specified purposes listed below:<br/>
<a id="pl.213.18"></a><var>213.18</var>    (1) Metropolitan Council under section 
         <statute_ref>473.132</statute_ref>, 
         <statute_ref>473.167</statute_ref>, 
         <statute_ref>473.249</statute_ref>, 
         <statute_ref>473.325</statute_ref>, <br/>
<statute_ref><a id="pl.213.19"></a><var>213.19</var>473.446
         </statute_ref>, 
         <statute_ref>473.521</statute_ref>, 
         <statute_ref>473.547</statute_ref>, or 
         <statute_ref>473.834</statute_ref>;<br/>
<a id="pl.213.20"></a><var>213.20</var>    (2) Metropolitan Airports Commission under section 
         <statute_ref>473.667</statute_ref>, 
         <statute_ref>473.671</statute_ref>, or 
         <statute_ref>473.672</statute_ref>; <br/>
<a id="pl.213.21"></a><var>213.21</var>and<br/>
<a id="pl.213.22"></a><var>213.22</var>    (3) Metropolitan Mosquito Control Commission under section 
         <statute_ref>473.711</statute_ref>.<br/>
<a id="pl.213.23"></a><var>213.23</var>    For purposes of this section, any levies made by the regional rail authorities in the <br/>
<a id="pl.213.24"></a><var>213.24</var>county of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter <br/>
<a id="pl.213.25"></a><var>213.25</var>398A shall be included with the appropriate county's levy and shall be discussed at that <br/>
<a id="pl.213.26"></a><var>213.26</var>county's public hearing.<br/>
<a id="pl.213.27"></a><var>213.27</var>    (j) The governing body of a county, city, or school district may, with the consent <br/>
<a id="pl.213.28"></a><var>213.28</var>of the county board, include supplemental information with the statement of proposed <br/>
<a id="pl.213.29"></a><var>213.29</var>property taxes about the impact of state aid increases or decreases on property tax <br/>
<a id="pl.213.30"></a><var>213.30</var>increases or decreases and on the level of services provided in the affected jurisdiction. <br/>
<a id="pl.213.31"></a><var>213.31</var>This supplemental information may include information for the following year, the current <br/>
<a id="pl.213.32"></a><var>213.32</var>year, and for as many consecutive preceding years as deemed appropriate by the governing <br/>
<a id="pl.213.33"></a><var>213.33</var>body of the county, city, or school district. It may include only information regarding:<br/>
<a id="pl.213.34"></a><var>213.34</var>    (1) the impact of inflation as measured by the implicit price deflator for state and <br/>
<a id="pl.213.35"></a><var>213.35</var>local government purchases;<br/>
<a id="pl.213.36"></a><var>213.36</var>    (2) population growth and decline;<br/>
<a id="pl.214.1"></a><var>214.1</var>    (3) state or federal government action; and<br/>
<a id="pl.214.2"></a><var>214.2</var>    (4) other financial factors that affect the level of property taxation and local services <br/>
<a id="pl.214.3"></a><var>214.3</var>that the governing body of the county, city, or school district may deem appropriate to <br/>
<a id="pl.214.4"></a><var>214.4</var>include.<br/>
<a id="pl.214.5"></a><var>214.5</var>    The information may be presented using tables, written narrative, and graphic <br/>
<a id="pl.214.6"></a><var>214.6</var>representations and may contain instruction toward further sources of information or <br/>
<a id="pl.214.7"></a><var>214.7</var>opportunity for comment.<br/>
<a id="pl.214.8"></a><var>214.8</var><b>EFFECTIVE DATE.</b>This section is effective for notices required in 2008 and <br/>
<a id="pl.214.9"></a><var>214.9</var>thereafter, for taxes payable in 2009 and thereafter.<br/>
<br/>
<a id="bill.13.39.0"></a><a id="pl.214.10"></a><var>214.10</var>    Sec. 39. Minnesota Statutes 2006, section 275.065, subdivision 5a, is amended to read:<br/>
<a id="pl.214.11"></a><var>214.11</var>    Subd. 5a. <b>Public advertisement.</b> (a) A city that has a population of more than <br/>
<a id="pl.214.12"></a><var>214.12</var>2,500, county, a metropolitan special taxing district as defined in subdivision 3, paragraph <br/>
<a id="pl.214.13"></a><var>214.13</var>(i), a regional library district established under section   
         <statute_ref>134.201</statute_ref>, or school district shall <br/>
<a id="pl.214.14"></a><var>214.14</var>advertise in a newspaper a notice of its intent to adopt a budget and property tax levy or, <br/>
<a id="pl.214.15"></a><var>214.15</var>in the case of a school district, to review its current budget and proposed property taxes <br/>
<a id="pl.214.16"></a><var>214.16</var>payable in the following year, at a public hearing, if a public hearing is required under <br/>
<a id="pl.214.17"></a><var>214.17</var>subdivision 6. The notice must be published not less than two business days nor more <br/>
<a id="pl.214.18"></a><var>214.18</var>than six business days before the hearing. <br/>
<a id="pl.214.19"></a><var>214.19</var>    The advertisement must be at least one-eighth page in size of a standard-size or a <br/>
<a id="pl.214.20"></a><var>214.20</var>tabloid-size newspaper. The advertisement must not be placed in the part of the newspaper <br/>
<a id="pl.214.21"></a><var>214.21</var>where legal notices and classified advertisements appear. The advertisement must be <br/>
<a id="pl.214.22"></a><var>214.22</var>published in an official newspaper of general circulation in the taxing authority. The <br/>
<a id="pl.214.23"></a><var>214.23</var>newspaper selected must be one of general interest and readership in the community, and <br/>
<a id="pl.214.24"></a><var>214.24</var>not one of limited subject matter. The advertisement must appear in a newspaper that is <br/>
<a id="pl.214.25"></a><var>214.25</var>published at least once per week.<br/>
<a id="pl.214.26"></a><var>214.26</var>    For purposes of this section, the metropolitan special taxing district's advertisement <br/>
<a id="pl.214.27"></a><var>214.27</var>must only be published in the Minneapolis Star and Tribune and the Saint Paul Pioneer <br/>
<a id="pl.214.28"></a><var>214.28</var>Press.<br/>
<a id="pl.214.29"></a><var>214.29</var>    In addition to other requirements, a county and a city having a population of <br/>
<a id="pl.214.30"></a><var>214.30</var>more than 2,500 must show in the public advertisement required under this subdivision <br/>
<a id="pl.214.31"></a><var>214.31</var>the current local tax rate, the proposed local tax rate if no property tax levy increase <br/>
<a id="pl.214.32"></a><var>214.32</var>is adopted, and the proposed rate if the proposed levy is adopted. For purposes of this <br/>
<a id="pl.214.33"></a><var>214.33</var>subdivision, "local tax rate" means the city's or county's net tax capacity levy divided by <br/>
<a id="pl.214.34"></a><var>214.34</var>the city's or county's taxable net tax capacity.<br/>
<a id="pl.215.1"></a><var>215.1</var>    (b) Subject to the provisions of paragraph (g), the advertisement for school districts, <br/>
<a id="pl.215.2"></a><var>215.2</var>metropolitan special taxing districts, and regional library districts must be in the following <br/>
<a id="pl.215.3"></a><var>215.3</var>form, except that the notice for a school district may include references to the current <br/>
<a id="pl.215.4"></a><var>215.4</var>budget in regard to proposed property taxes.<br/>

<a id="pl.215.9"></a><var>215.9</var>Library District) of .........<br/>
<a id="pl.215.10"></a><var>215.10</var>The governing body of ........ will soon hold budget hearings and vote on the property <br/>
<a id="pl.215.11"></a><var>215.11</var>taxes for (metropolitan special taxing district/regional library district services that will be <br/>
<a id="pl.215.12"></a><var>215.12</var>provided in (year)/school district services that will be provided in (year) and (year)).<br/>

<a id="pl.215.15"></a><var>215.15</var>on the proposed (school district/metropolitan special taxing district/regional library <br/>
<a id="pl.215.16"></a><var>215.16</var>district) budget and property taxes, or in the case of a school district, its current budget <br/>
<a id="pl.215.17"></a><var>215.17</var>and proposed property taxes, payable in the following year. The hearing will be held on <br/>
<a id="pl.215.18"></a><var>215.18</var>(Month/Day/Year) at (Time) at (Location, Address)."<br/>
<a id="pl.215.19"></a><var>215.19</var>    (c) Subject to the provisions of paragraph (g), the advertisement for cities and <br/>
<a id="pl.215.20"></a><var>215.20</var>counties must be in the following form.<br/>

<a id="pl.215.23"></a><var>215.23</var>The (city/county) governing body or board of commissioners will hold a public hearing to <br/>
<a id="pl.215.24"></a><var>215.24</var>discuss the budget and to vote on the amount of property taxes to collect for services the <br/>
<a id="pl.215.25"></a><var>215.25</var>(city/county) will provide in (year).<br/>
<a id="pl.215.26"></a><var>215.26</var>SPENDING: The total budget amounts below compare (city's/county's) (year) total actual <br/>
<a id="pl.215.27"></a><var>215.27</var>budget with the amount the (city/county) proposes to spend in (year).<br/>
<table>
<col width="50px"/>
<col width="126px"/>
<col width="21px"/>
<col width="147px"/>
<col width="21px"/>
<col width="126px"/>
<tr>
<td><a id="pl.215.28"></a><var>215.28</var><br/>
<a id="pl.215.29"></a><var>215.29</var><br/>
</td>
<td align="center" valign="bottom">(Year) Total Actual <br/>
                  		Budget<br/>
</td>
<td align="left" valign="bottom"></td>
<td align="center" valign="top">Proposed (Year) <br/>
                  		Budget<br/>
</td>
<td align="left" valign="bottom"></td>
<td align="center" valign="bottom">Change from <br/>
                  		(Year)-(Year)<br/>
</td>
</tr>
<tr>
<td></td>
<td align="center" valign="bottom"></td>
<td align="left" valign="bottom"></td>
<td align="center" valign="bottom"></td>
<td align="left" valign="bottom"></td>
<td align="center" valign="bottom"></td>
</tr>
<tr>
<td><a id="pl.215.30"></a><var>215.30</var><br/>
</td>
<td align="center" valign="bottom">$...........<br/>
</td>
<td align="left" valign="bottom"></td>
<td align="center" valign="bottom">$...........<br/>
</td>
<td align="left" valign="bottom"></td>
<td align="center" valign="bottom">.....%<br/>
</td>
</tr>
</table><a id="pl.215.31"></a><var>215.31</var>TAXES: The property tax amounts below compare that portion of the current budget <br/>
<a id="pl.215.32"></a><var>215.32</var>levied in property taxes in (city/county) for (year) with the property taxes the (city/county) <br/>
<a id="pl.215.33"></a><var>215.33</var>proposes to collect in (year).<br/>
<table>
<col width="50px"/>
<col width="126px"/>
<col width="21px"/>
<col width="147px"/>
<col width="21px"/>
<col width="126px"/>
<tr>
<td><a id="pl.215.34"></a><var>215.34</var><br/>
<a id="pl.215.35"></a><var>215.35</var><br/>
</td>
<td align="center" valign="bottom">(Year) Property <br/>
                  		Taxes<br/>
</td>
<td align="left" valign="bottom"></td>
<td align="center" valign="bottom">Proposed (Year) <br/>
                  		Property Taxes<br/>
</td>
<td align="left" valign="bottom"></td>
<td align="center" valign="bottom">Change from <br/>
                  		(Year)-(Year)<br/>
</td>
</tr>
<tr>
<td></td>
<td align="center" valign="bottom"></td>
<td align="left" valign="bottom"></td>
<td align="center" valign="bottom"></td>
<td align="left" valign="bottom"></td>
<td align="center" valign="bottom"></td>
</tr>
<tr>
<td><a id="pl.215.36"></a><var>215.36</var><br/>
</td>
<td align="center" valign="bottom">$...........<br/>
</td>
<td align="left" valign="bottom"></td>
<td align="center" valign="bottom">$...........<br/>
</td>
<td align="left" valign="bottom"></td>
<td align="center" valign="bottom">.....%<br/>
</td>
</tr>
</table><a id="pl.216.1"></a><var>216.1</var>LOCAL TAX RATE COMPARISON: The current local tax rate, the local tax rate if no tax <br/>
<a id="pl.216.2"></a><var>216.2</var>levy increase is adopted, and the proposed local tax rate if the proposed levy is adopted.<br/>
<table>
<col width="50px"/>
<col width="126px"/>
<col width="21px"/>
<col width="147px"/>
<col width="21px"/>
<col width="126px"/>
<tr>
<td><a id="pl.216.3"></a><var>216.3</var><br/>
<a id="pl.216.4"></a><var>216.4</var><br/>
</td>
<td align="center" valign="top">(Year) Tax Rate<br/>
</td>
<td align="left" valign="bottom"></td>
<td align="center" valign="top">(Year) Tax Rate if NO <br/>
                  		Levy Increase<br/>
</td>
<td align="left" valign="bottom"></td>
<td align="center" valign="bottom">(Year) Proposed <br/>
                  		Tax Rate<br/>
</td>
</tr>
<tr>
<td><a id="pl.216.5"></a><var>216.5</var><br/>
</td>
<td align="center" valign="bottom">...........<br/>
</td>
<td align="left" valign="bottom"></td>
<td align="center" valign="bottom">...........<br/>
</td>
<td align="left" valign="bottom"></td>
<td align="center" valign="bottom">.....<br/>
</td>
</tr>
</table>

<a id="pl.216.8"></a><var>216.8</var>express your opinions on the budget and the proposed amount of (year) property taxes. <br/>
<a id="pl.216.9"></a><var>216.9</var>The hearing will be held on:<br/>

<a id="pl.216.12"></a><var>216.12</var>If the discussion of the budget cannot be completed, a time and place for continuing the <br/>
<a id="pl.216.13"></a><var>216.13</var>discussion will be announced at the hearing. You are also invited to send your written <br/>
<a id="pl.216.14"></a><var>216.14</var>comments to:<br/>

<a id="pl.216.17"></a><var>216.17</var>    (d) For purposes of this subdivision, the budget amounts listed on the advertisement <br/>
<a id="pl.216.18"></a><var>216.18</var>mean:<br/>
<a id="pl.216.19"></a><var>216.19</var>    (1) for cities, the total government fund expenditures, as defined by the state auditor <br/>
<a id="pl.216.20"></a><var>216.20</var>under section   
         <statute_ref>471.6965</statute_ref>, less any expenditures for improvements or services that are <br/>
<a id="pl.216.21"></a><var>216.21</var>specially assessed or charged under chapter 429, 430, 435, or the provisions of any other <br/>
<a id="pl.216.22"></a><var>216.22</var>law or charter; and <br/>
<a id="pl.216.23"></a><var>216.23</var>    (2) for counties, the total government fund expenditures, as defined by the state <br/>
<a id="pl.216.24"></a><var>216.24</var>auditor under section   
         <statute_ref>375.169</statute_ref>, less any expenditures for direct payments to recipients or <br/>
<a id="pl.216.25"></a><var>216.25</var>providers for the human service aids listed below: <br/>
<a id="pl.216.26"></a><var>216.26</var>    (i) Minnesota family investment program under chapters 256J and 256K;<br/>
<a id="pl.216.27"></a><var>216.27</var>    (ii) medical assistance under sections   
         <statute_ref>256B.041, subdivision 5</statute_ref>, and   
         <statute_ref>256B.19, <br/>
<a id="pl.216.28"></a><var>216.28</var>subdivision 1
         </statute_ref>; <br/>
<a id="pl.216.29"></a><var>216.29</var>    (iii) general assistance medical care under section   
         <statute_ref>256D.03, subdivision 6</statute_ref>; <br/>
<a id="pl.216.30"></a><var>216.30</var>    (iv) general assistance under section   
         <statute_ref>256D.03, subdivision 2</statute_ref>; <br/>
<a id="pl.216.31"></a><var>216.31</var>    (v) emergency assistance under section   
         <statute_ref>256J.48</statute_ref>; <br/>
<a id="pl.216.32"></a><var>216.32</var>    (vi) Minnesota supplemental aid under section   
         <statute_ref>256D.36, subdivision 1</statute_ref>; <br/>
<a id="pl.216.33"></a><var>216.33</var>    (vii) preadmission screening under section   
         <statute_ref>256B.0911</statute_ref>, and alternative care grants <br/>
<a id="pl.216.34"></a><var>216.34</var>under section   
         <statute_ref>256B.0913</statute_ref>; <br/>
<a id="pl.216.35"></a><var>216.35</var>    (viii) general assistance medical care claims processing, medical transportation and <br/>
<a id="pl.216.36"></a><var>216.36</var>related costs under section   
         <statute_ref>256D.03, subdivision 4</statute_ref>; <br/>
<a id="pl.217.1"></a><var>217.1</var>    (ix) medical transportation and related costs under section   
         <statute_ref>256B.0625, subdivisions <br/>
<a id="pl.217.2"></a><var>217.2</var>17 to 18a
         </statute_ref>; <br/>
<a id="pl.217.3"></a><var>217.3</var>    (x) group residential housing under section   
         <statute_ref>256I.05, subdivision 8</statute_ref>, transferred from <br/>
<a id="pl.217.4"></a><var>217.4</var>programs in clauses (iv) and (vi); or <br/>
<a id="pl.217.5"></a><var>217.5</var>    (xi) any successor programs to those listed in clauses (i) to (x).<br/>
<a id="pl.217.6"></a><var>217.6</var>    (e) A city with a population of over 500 but not more than 2,500 that is required to <br/>
<a id="pl.217.7"></a><var>217.7</var>hold a public hearing under subdivision 6 must advertise by posted notice as defined in <br/>
<a id="pl.217.8"></a><var>217.8</var>section   
         <statute_ref>645.12, subdivision 1</statute_ref>. The advertisement must be posted at the time provided in <br/>
<a id="pl.217.9"></a><var>217.9</var>paragraph (a). It must be in the form required in paragraph (b). <br/>
<a id="pl.217.10"></a><var>217.10</var>    (f) For purposes of this subdivision, the population of a city is the most recent <br/>
<a id="pl.217.11"></a><var>217.11</var>population as determined by the state demographer under section   
         <statute_ref>4A.02</statute_ref>. <br/>
<a id="pl.217.12"></a><var>217.12</var>    (g) The commissioner of revenue, subject to the approval of the chairs of the house <br/>
<a id="pl.217.13"></a><var>217.13</var>and senate tax committees, shall annually prescribe the specific form and format of the <br/>
<a id="pl.217.14"></a><var>217.14</var>advertisements required under this subdivision, including such details as font size and <br/>
<a id="pl.217.15"></a><var>217.15</var>style, and spacing for the required items. The commissioner may prescribe alternate and <br/>
<a id="pl.217.16"></a><var>217.16</var>additional language for the advertisement for a taxing authority or for groups of taxing <br/>
<a id="pl.217.17"></a><var>217.17</var>authorities. At least two weeks before November 29 each year, the commissioner shall <br/>
<a id="pl.217.18"></a><var>217.18</var>provide a copy of the prescribed advertisements to the chairs of the committees of the <br/>
<a id="pl.217.19"></a><var>217.19</var>house of representatives and the senate with jurisdiction over taxes.<br/>
<a id="pl.217.20"></a><var>217.20</var><b>EFFECTIVE DATE.</b>This section is effective for advertisements in 2008 and <br/>
<a id="pl.217.21"></a><var>217.21</var>thereafter, for proposed taxes payable in 2009 and thereafter.<br/>
<br/>
<a id="bill.13.40.0"></a><a id="pl.217.22"></a><var>217.22</var>    Sec. 40. Minnesota Statutes 2006, section 275.067, is amended to read:<br/>
<a id="pl.217.23"></a><var>217.23</var><b>275.067 SPECIAL TAXING DISTRICTS; ORGANIZATION DATE; </b><br/>
<a id="pl.217.24"></a><var>217.24</var><b>CERTIFICATION OF LEVY OR SPECIAL ASSESSMENTS.</b><br/>
<a id="pl.217.25"></a><var>217.25</var>    Special taxing districts as defined in section 
         <statute_ref>275.066</statute_ref> organized on or before July 1 in <br/>
<a id="pl.217.26"></a><var>217.26</var>a the current calendar year may, and special taxing districts organized in a prior year that <br/>
<a id="pl.217.27"></a><var>217.27</var>have not previously certified a levy to the county auditor, are allowed to certify a levy to <br/>
<a id="pl.217.28"></a><var>217.28</var>the county auditor in that same the current year for property taxes or special assessments <br/>
<a id="pl.217.29"></a><var>217.29</var>to be payable in the following calendar year to the extent that the special taxing district is <br/>
<a id="pl.217.30"></a><var>217.30</var>authorized by statute or special act to levy taxes or special assessments, but only if the <br/>
<a id="pl.217.31"></a><var>217.31</var>county auditor receives written notice from the district on or before July 1 of the current <br/>
<a id="pl.217.32"></a><var>217.32</var>year that the district may be certifying a levy in the current year, and the notice includes a <br/>
<a id="pl.217.33"></a><var>217.33</var>complete list or other description of the tax parcels in the district and a map showing the <br/>
<a id="pl.217.34"></a><var>217.34</var>boundaries of the district. Special taxing districts organized after July 1 in a calendar year <br/>
<a id="pl.218.1"></a><var>218.1</var>may not certify a levy of property taxes or special assessments to the county auditor under <br/>
<a id="pl.218.2"></a><var>218.2</var>the powers granted to them by statute or special act and subject to the requirements of <br/>
<a id="pl.218.3"></a><var>218.3</var>this section until the following calendar year. All special taxing districts must notify the <br/>
<a id="pl.218.4"></a><var>218.4</var>county auditor by July 1 in order for its boundaries for the levy to be certified that year <br/>
<a id="pl.218.5"></a><var>218.5</var>to be different than its boundaries for levies certified in prior years, and the notice must <br/>
<a id="pl.218.6"></a><var>218.6</var>include a complete list or other description of the tax parcels within the new boundaries <br/>
<a id="pl.218.7"></a><var>218.7</var>and a map showing the new boundaries of the district. <br/>
<a id="pl.218.8"></a><var>218.8</var><b>EFFECTIVE DATE.</b>This section is effective for taxes payable in 2009 and <br/>
<a id="pl.218.9"></a><var>218.9</var>thereafter.<br/>
<br/>
<a id="bill.13.41.0"></a><a id="pl.218.10"></a><var>218.10</var>    Sec. 41. Minnesota Statutes 2006, section 276.04, is amended by adding a subdivision <br/>
<a id="pl.218.11"></a><var>218.11</var>to read:<br/>
<a id="pl.218.12"></a><var>218.12</var>    Subd. 5. <b>Electronic tax statements.</b> Upon written request by the owner of real <br/>
<a id="pl.218.13"></a><var>218.13</var>property located in the county, or by the owner's agent, a county may send tax statements <br/>
<a id="pl.218.14"></a><var>218.14</var>by electronic means instead of by mailing. For the purposes of the payment deadlines <br/>
<a id="pl.218.15"></a><var>218.15</var>specified in section 279.01, the postmark date on the envelope containing these property <br/>
<a id="pl.218.16"></a><var>218.16</var>tax statements is the date the statements were sent by electronic means.<br/>
<a id="pl.218.17"></a><var>218.17</var><b>EFFECTIVE DATE.</b>This section is effective for tax statements for taxes payable <br/>
<a id="pl.218.18"></a><var>218.18</var>in 2009 and thereafter.<br/>
<br/>
<a id="bill.13.42.0"></a><a id="pl.218.19"></a><var>218.19</var>    Sec. 42. Minnesota Statutes 2006, section 277.01, subdivision 2, is amended to read:<br/>
<a id="pl.218.20"></a><var>218.20</var>    Subd. 2. <b>Partial payments.</b> The county treasurer may accept payments of more or <br/>
<a id="pl.218.21"></a><var>218.21</var>less than the exact amount of a tax installment due. Payments must be applied first to the <br/>
<a id="pl.218.22"></a><var>218.22</var>oldest installment that is due but which has not been fully paid. If the accepted payment is <br/>
<a id="pl.218.23"></a><var>218.23</var>less than the amount due, payments must be the payment is applied first to the penalty <br/>
<a id="pl.218.24"></a><var>218.24</var>accrued for the year the payment is made or the installment being paid. Acceptance of <br/>
<a id="pl.218.25"></a><var>218.25</var>partial payment of tax does not constitute a waiver of the minimum payment required as a <br/>
<a id="pl.218.26"></a><var>218.26</var>condition for filing an appeal under section 
         <statute_ref>278.03</statute_ref> or any other law, nor does it affect the <br/>
<a id="pl.218.27"></a><var>218.27</var>order of payment of delinquent taxes under section 
         <statute_ref>280.39</statute_ref>. <br/>
<a id="pl.218.28"></a><var>218.28</var><b>EFFECTIVE DATE.</b>This section is effective for payments made after the day <br/>
<a id="pl.218.29"></a><var>218.29</var>of final enactment.<br/>
<br/>
<a id="bill.13.43.0"></a><a id="pl.218.30"></a><var>218.30</var>    Sec. 43. Minnesota Statutes 2006, section 279.01, subdivision 1, is amended to read:<br/>
<a id="pl.218.31"></a><var>218.31</var>    Subdivision 1. <b>Due dates; penalties.</b> Except as provided in subdivision 3 or 4, on <br/>
<a id="pl.218.32"></a><var>218.32</var>May 16 or 21 days after the postmark date on the envelope containing the property tax <br/>
<a id="pl.219.1"></a><var>219.1</var>statement, whichever is later, a penalty shall accrue accrues and thereafter be is charged <br/>
<a id="pl.219.2"></a><var>219.2</var>upon all unpaid taxes on real estate on the current lists in the hands of the county treasurer. <br/>
<a id="pl.219.3"></a><var>219.3</var>The penalty shall be is at a rate of two percent on homestead property until May 31 and <br/>
<a id="pl.219.4"></a><var>219.4</var>four percent on June 1. The penalty on nonhomestead property shall be is at a rate of four <br/>
<a id="pl.219.5"></a><var>219.5</var>percent until May 31 and eight percent on June 1. This penalty shall does not accrue until <br/>
<a id="pl.219.6"></a><var>219.6</var>June 1 of each year, or 21 days after the postmark date on the envelope containing the <br/>
<a id="pl.219.7"></a><var>219.7</var>property tax statements, whichever is later, on commercial use real property used for <br/>
<a id="pl.219.8"></a><var>219.8</var>seasonal residential recreational purposes and classified as class 1c or 4c, and on other <br/>
<a id="pl.219.9"></a><var>219.9</var>commercial use real property classified as class 3a, provided that over 60 percent of the <br/>
<a id="pl.219.10"></a><var>219.10</var>gross income earned by the enterprise on the class 3a property is earned during the months <br/>
<a id="pl.219.11"></a><var>219.11</var>of May, June, July, and August. Any property owner of such class 3a property who pays <br/>
<a id="pl.219.12"></a><var>219.12</var>In order for the first half of the tax due on the class 3a property to be paid after May 15 <br/>
<a id="pl.219.13"></a><var>219.13</var>and before June 1, or 21 days after the postmark date on the envelope containing the <br/>
<a id="pl.219.14"></a><var>219.14</var>property tax statement, whichever is later, shall without penalty, the owner of the property <br/>
<a id="pl.219.15"></a><var>219.15</var>must attach an affidavit to the payment attesting to compliance with the income provision <br/>
<a id="pl.219.16"></a><var>219.16</var>of this subdivision. Thereafter, for both homestead and nonhomestead property, on the <br/>
<a id="pl.219.17"></a><var>219.17</var>first day of each month beginning July 1, up to and including October 1 following, an <br/>
<a id="pl.219.18"></a><var>219.18</var>additional penalty of one percent for each month shall accrue accrues and be is charged on <br/>
<a id="pl.219.19"></a><var>219.19</var>all such unpaid taxes provided that if the due date was extended beyond May 15 as the <br/>
<a id="pl.219.20"></a><var>219.20</var>result of any delay in mailing property tax statements no additional penalty shall accrue <br/>
<a id="pl.219.21"></a><var>219.21</var>if the tax is paid by the extended due date. If the tax is not paid by the extended due <br/>
<a id="pl.219.22"></a><var>219.22</var>date, then all penalties that would have accrued if the due date had been May 15 shall be <br/>
<a id="pl.219.23"></a><var>219.23</var>charged. When the taxes against any tract or lot exceed $50, one-half thereof may be paid <br/>
<a id="pl.219.24"></a><var>219.24</var>prior to May 16 or 21 days after the postmark date on the envelope containing the property <br/>
<a id="pl.219.25"></a><var>219.25</var>tax statement, whichever is later; and, if so paid, no penalty shall attach attaches; the <br/>
<a id="pl.219.26"></a><var>219.26</var>remaining one-half shall may be paid at any time prior to October 16 following, without <br/>
<a id="pl.219.27"></a><var>219.27</var>penalty; but, if not so paid, then a penalty of two percent shall accrue accrues thereon for <br/>
<a id="pl.219.28"></a><var>219.28</var>homestead property and a penalty of four percent on nonhomestead property. Thereafter, <br/>
<a id="pl.219.29"></a><var>219.29</var>for homestead property, on the first day of November an additional penalty of four percent <br/>
<a id="pl.219.30"></a><var>219.30</var>shall accrue accrues and on the first day of December following, an additional penalty of <br/>
<a id="pl.219.31"></a><var>219.31</var>two percent shall accrue accrues and be is charged on all such unpaid taxes. Thereafter, <br/>
<a id="pl.219.32"></a><var>219.32</var>for nonhomestead property, on the first day of November and December following, an <br/>
<a id="pl.219.33"></a><var>219.33</var>additional penalty of four percent for each month shall accrue accrues and be is charged <br/>
<a id="pl.219.34"></a><var>219.34</var>on all such unpaid taxes. If one-half of such taxes shall are not be paid prior to May 16 or <br/>
<a id="pl.219.35"></a><var>219.35</var>21 days after the postmark date on the envelope containing the property tax statement, <br/>
<a id="pl.219.36"></a><var>219.36</var>whichever is later, the same may be paid at any time prior to October 16, with accrued <br/>
<a id="pl.220.1"></a><var>220.1</var>penalties to the date of payment added, and thereupon no penalty shall attach attaches to <br/>
<a id="pl.220.2"></a><var>220.2</var>the remaining one-half until October 16 following.<br/>
<a id="pl.220.3"></a><var>220.3</var>    This section applies to payment of personal property taxes assessed against <br/>
<a id="pl.220.4"></a><var>220.4</var>improvements to leased property, except as provided by section 
         <statute_ref>277.01, subdivision 3</statute_ref>. <br/>
<a id="pl.220.5"></a><var>220.5</var>    A county may provide by resolution that in the case of a property owner that has <br/>
<a id="pl.220.6"></a><var>220.6</var>multiple tracts or parcels with aggregate taxes exceeding $50, payments may be made in <br/>
<a id="pl.220.7"></a><var>220.7</var>installments as provided in this subdivision.<br/>
<a id="pl.220.8"></a><var>220.8</var>    The county treasurer may accept payments of more or less than the exact amount of <br/>
<a id="pl.220.9"></a><var>220.9</var>a tax installment due. Payments must be applied first to the oldest installment that is due <br/>
<a id="pl.220.10"></a><var>220.10</var>but which has not been fully paid. If the accepted payment is less than the amount due, <br/>
<a id="pl.220.11"></a><var>220.11</var>payments must be applied first to the penalty accrued for the year the payment is made <br/>
<a id="pl.220.12"></a><var>220.12</var>or the installment being paid. Acceptance of partial payment of tax does not constitute <br/>
<a id="pl.220.13"></a><var>220.13</var>a waiver of the minimum payment required as a condition for filing an appeal under <br/>
<a id="pl.220.14"></a><var>220.14</var>section 
         <statute_ref>278.03</statute_ref> or any other law, nor does it affect the order of payment of delinquent <br/>
<a id="pl.220.15"></a><var>220.15</var>taxes under section 
         <statute_ref>280.39</statute_ref>. <br/>
<a id="pl.220.16"></a><var>220.16</var><b>EFFECTIVE DATE.</b>This section is effective for payments made after the day <br/>
<a id="pl.220.17"></a><var>220.17</var>of final enactment.<br/>
<br/>
<a id="bill.13.44.0"></a><a id="pl.220.18"></a><var>220.18</var>    Sec. 44. Minnesota Statutes 2006, section 290B.03, subdivision 2, is amended to read:<br/>
<a id="pl.220.19"></a><var>220.19</var>    Subd. 2. <b>Qualifying homestead; defined.</b> Qualifying homestead property is defined <br/>
<a id="pl.220.20"></a><var>220.20</var>as the dwelling located in this state that is taxed as real property and that is occupied as the <br/>
<a id="pl.220.21"></a><var>220.21</var>homeowner's principal residence and so much of the land surrounding it as is reasonably <br/>
<a id="pl.220.22"></a><var>220.22</var>necessary for use of the dwelling as a home and any other property used for purposes of a <br/>
<a id="pl.220.23"></a><var>220.23</var>homestead as defined in section 
         <statute_ref>273.13, subdivisions 22 and 23</statute_ref>, but not to exceed one <br/>
<a id="pl.220.24"></a><var>220.24</var>acre. The homestead may be part of a multidwelling building and the land on which it is <br/>
<a id="pl.220.25"></a><var>220.25</var>built.  Property is not qualifying homestead property if a person or entity other than the <br/>
<a id="pl.220.26"></a><var>220.26</var>applicant or the applicant's spouse holds an interest in the property as the vendor under a <br/>
<a id="pl.220.27"></a><var>220.27</var>contract for deed or as a remainderperson.<br/>
<a id="pl.220.28"></a><var>220.28</var><b>EFFECTIVE DATE.</b>This section is effective retroactively for applications <br/>
<a id="pl.220.29"></a><var>220.29</var>submitted after December 31, 2007.<br/>
<br/>
<a id="bill.13.45.0"></a><a id="pl.220.30"></a><var>220.30</var>    Sec. 45. Minnesota Statutes 2006, section 290C.02, subdivision 3, is amended to read:<br/>
<a id="pl.220.31"></a><var>220.31</var>    Subd. 3. <b>Claimant.</b> (a) "Claimant" means: <br/>
<a id="pl.221.1"></a><var>221.1</var>    (1) a person, as that term is defined in section 
         <statute_ref>290.01, subdivision 2</statute_ref>, who owns <br/>
<a id="pl.221.2"></a><var>221.2</var>forest land in Minnesota and files an application authorized by the Sustainable Forest <br/>
<a id="pl.221.3"></a><var>221.3</var>Incentive Act. Claimant includes;<br/>
<a id="pl.221.4"></a><var>221.4</var>    (2) a purchaser or grantee if property enrolled in the program was sold or transferred <br/>
<a id="pl.221.5"></a><var>221.5</var>after the original application was filed and prior to the annual incentive payment being <br/>
<a id="pl.221.6"></a><var>221.6</var>made.; or<br/>
<a id="pl.221.7"></a><var>221.7</var>    (3) an owner of land previously covered by an auxiliary forest contract that <br/>
<a id="pl.221.8"></a><var>221.8</var>automatically qualifies for inclusion in the Sustainable Forest Incentive Act program <br/>
<a id="pl.221.9"></a><var>221.9</var>pursuant to section 88.49, subdivision 9a, or 88.491, subdivision 2.<br/>
<a id="pl.221.10"></a><var>221.10</var>     The purchaser or grantee must notify the commissioner in writing of the sale or <br/>
<a id="pl.221.11"></a><var>221.11</var>transfer of the property. Owners of land that qualifies for inclusion pursuant to section <br/>
<a id="pl.221.12"></a><var>221.12</var>88.49, subdivision 9a, or 88.491, subdivision 2, must notify the commissioner in writing <br/>
<a id="pl.221.13"></a><var>221.13</var>of the expiration of the auxiliary forest contract or land trade with a governmental unit and <br/>
<a id="pl.221.14"></a><var>221.14</var>submit an application to the commissioner by August 15 in order to be eligible to receive a <br/>
<a id="pl.221.15"></a><var>221.15</var>payment by October 1 of that same year. For purposes of section 
         <statute_ref>290C.11</statute_ref>, claimant also <br/>
<a id="pl.221.16"></a><var>221.16</var>includes any person bound by the covenant required in section 
         <statute_ref>290C.04</statute_ref>. <br/>
<a id="pl.221.17"></a><var>221.17</var>    (b) No more than one claimant is entitled to a payment under this chapter with <br/>
<a id="pl.221.18"></a><var>221.18</var>respect to any tract, parcel, or piece of land enrolled under this chapter that has been <br/>
<a id="pl.221.19"></a><var>221.19</var>assigned the same parcel identification number. When enrolled forest land is owned by <br/>
<a id="pl.221.20"></a><var>221.20</var>two or more persons, the owners must determine between them which person is eligible to <br/>
<a id="pl.221.21"></a><var>221.21</var>claim the payments provided under sections 
         <statute_ref>290C.01</statute_ref> to 
         <statute_ref>290C.11</statute_ref>. In the case of property <br/>
<a id="pl.221.22"></a><var>221.22</var>sold or transferred, the former owner and the purchaser or grantee must determine between <br/>
<a id="pl.221.23"></a><var>221.23</var>them which person is eligible to claim the payments provided under sections 
         <statute_ref>290C.01</statute_ref> to <br/>
<statute_ref><a id="pl.221.24"></a><var>221.24</var>290C.11
         </statute_ref>. The owners, transferees, or grantees must notify the commissioner in writing <br/>
<a id="pl.221.25"></a><var>221.25</var>which person is eligible to claim the payments. <br/>
<a id="pl.221.26"></a><var>221.26</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.46.0"></a><a id="pl.221.27"></a><var>221.27</var>    Sec. 46. Minnesota Statutes 2006, section 290C.04, is amended to read:<br/>
<a id="pl.221.28"></a><var>221.28</var><b>290C.04 APPLICATIONS.</b><br/>
<a id="pl.221.29"></a><var>221.29</var>    (a) A landowner may apply to enroll forest land for the sustainable forest incentive <br/>
<a id="pl.221.30"></a><var>221.30</var>program under this chapter. The claimant must complete, sign, and submit an application <br/>
<a id="pl.221.31"></a><var>221.31</var>to the commissioner by September 30 in order for the land to become eligible beginning <br/>
<a id="pl.221.32"></a><var>221.32</var>in the next year. The application shall be on a form prescribed by the commissioner and <br/>
<a id="pl.221.33"></a><var>221.33</var>must include the information the commissioner deems necessary. At a minimum, the <br/>
<a id="pl.221.34"></a><var>221.34</var>application must show the following information for the land and the claimant: (i) the <br/>
<a id="pl.222.1"></a><var>222.1</var>claimant's Social Security number or state or federal business tax registration number and <br/>
<a id="pl.222.2"></a><var>222.2</var>date of birth, (ii) the claimant's address, (iii) the claimant's signature, (iv) the county's <br/>
<a id="pl.222.3"></a><var>222.3</var>parcel identification numbers for the tax parcels that completely contain the claimant's <br/>
<a id="pl.222.4"></a><var>222.4</var>forest land that is sought to be enrolled, (v) the number of acres eligible for enrollment <br/>
<a id="pl.222.5"></a><var>222.5</var>in the program, (vi) the approved plan writer's signature and identification number, and <br/>
<a id="pl.222.6"></a><var>222.6</var>(vii) proof, in a form specified by the commissioner, that the claimant has executed and <br/>
<a id="pl.222.7"></a><var>222.7</var>acknowledged in the manner required by law for a deed, and recorded, a covenant that the <br/>
<a id="pl.222.8"></a><var>222.8</var>land is not and shall not be developed in a manner inconsistent with the requirements and <br/>
<a id="pl.222.9"></a><var>222.9</var>conditions of this chapter. The covenant shall state in writing that the covenant is binding <br/>
<a id="pl.222.10"></a><var>222.10</var>on the claimant and the claimant's successor or assignee, and that it runs with the land <br/>
<a id="pl.222.11"></a><var>222.11</var>for a period of not less than eight years. The commissioner shall specify the form of the <br/>
<a id="pl.222.12"></a><var>222.12</var>covenant and provide copies upon request. The covenant must include a legal description <br/>
<a id="pl.222.13"></a><var>222.13</var>that encompasses all the forest land that the claimant wishes to enroll under this section or <br/>
<a id="pl.222.14"></a><var>222.14</var>the certificate of title number for that land if it is registered land.<br/>
<a id="pl.222.15"></a><var>222.15</var>    (b) In all cases, the commissioner shall notify the claimant within 90 days after <br/>
<a id="pl.222.16"></a><var>222.16</var>receipt of a completed application that either the land has or has not been approved for <br/>
<a id="pl.222.17"></a><var>222.17</var>enrollment. A claimant whose application is denied may appeal the denial as provided in <br/>
<a id="pl.222.18"></a><var>222.18</var>section 
         <statute_ref>290C.11, paragraph (a) 290C.13</statute_ref>. <br/>
<a id="pl.222.19"></a><var>222.19</var>    (c) Within 90 days after the denial of an application, or within 90 days after the <br/>
<a id="pl.222.20"></a><var>222.20</var>final resolution of any appeal related to the denial, the commissioner shall execute and <br/>
<a id="pl.222.21"></a><var>222.21</var>acknowledge a document releasing the land from the covenant required under this chapter. <br/>
<a id="pl.222.22"></a><var>222.22</var>The document must be mailed to the claimant and is entitled to be recorded.<br/>
<a id="pl.222.23"></a><var>222.23</var>    (d) The Social Security numbers collected from individuals under this section are <br/>
<a id="pl.222.24"></a><var>222.24</var>private data as provided in section 
         <statute_ref>13.355</statute_ref>. The federal business tax registration number <br/>
<a id="pl.222.25"></a><var>222.25</var>and date of birth data collected under this section are also private data on individuals or <br/>
<a id="pl.222.26"></a><var>222.26</var>nonpublic data, as defined in section 
         <statute_ref>13.02, subdivisions 9 and 12</statute_ref>, but may be shared <br/>
<a id="pl.222.27"></a><var>222.27</var>with county assessors for purposes of tax administration and with county treasurers for <br/>
<a id="pl.222.28"></a><var>222.28</var>purposes of the revenue recapture under chapter 270A. <br/>
<a id="pl.222.29"></a><var>222.29</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.47.0"></a><a id="pl.222.30"></a><var>222.30</var>    Sec. 47. Minnesota Statutes 2006, section 290C.05, is amended to read:<br/>
<a id="pl.222.31"></a><var>222.31</var><b>290C.05 ANNUAL CERTIFICATION.</b><br/>
<a id="pl.222.32"></a><var>222.32</var>    On or before July 1 of each year, beginning with the year after the original claimant <br/>
<a id="pl.222.33"></a><var>222.33</var>has received an approved application, the commissioner shall send each claimant enrolled <br/>
<a id="pl.222.34"></a><var>222.34</var>under the sustainable forest incentive program a certification form. For purposes of this <br/>
<a id="pl.223.1"></a><var>223.1</var>section, the original claimant is the person that filed the first application under section <br/>
<a id="pl.223.2"></a><var>223.2</var>290C.04 to enroll the land in the program. The claimant must sign the certification, <br/>
<a id="pl.223.3"></a><var>223.3</var>attesting that the requirements and conditions for continued enrollment in the program are <br/>
<a id="pl.223.4"></a><var>223.4</var>currently being met, and must return the signed certification form to the commissioner by <br/>
<a id="pl.223.5"></a><var>223.5</var>August 15 of that same year. If the claimant does not return an annual certification form <br/>
<a id="pl.223.6"></a><var>223.6</var>by the due date, the provisions in section 
         <statute_ref>290C.11</statute_ref> apply.<br/>
<a id="pl.223.7"></a><var>223.7</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.48.0"></a><a id="pl.223.8"></a><var>223.8</var>    Sec. 48. Minnesota Statutes 2006, section 290C.11, is amended to read:<br/>
<a id="pl.223.9"></a><var>223.9</var><b>290C.11 PENALTIES FOR REMOVAL.</b><br/>
<a id="pl.223.10"></a><var>223.10</var>    (a) If the commissioner determines that land enrolled in the sustainable forest <br/>
<a id="pl.223.11"></a><var>223.11</var>incentive program is in violation of the conditions for enrollment as specified in section <br/>
<statute_ref><a id="pl.223.12"></a><var>223.12</var>290C.03
         </statute_ref>, the commissioner shall notify the claimant of the intent to remove all enrolled <br/>
<a id="pl.223.13"></a><var>223.13</var>land from the sustainable forest incentive program. The claimant has 60 days to appeal <br/>
<a id="pl.223.14"></a><var>223.14</var>this determination under the provisions of section 290C.13. The appeal must be made <br/>
<a id="pl.223.15"></a><var>223.15</var>in writing to the commissioner, who shall, within 60 days, notify the claimant as to the <br/>
<a id="pl.223.16"></a><var>223.16</var>outcome of the appeal. Within 60 days after the commissioner denies an appeal, or within <br/>
<a id="pl.223.17"></a><var>223.17</var>120 days after the commissioner received a written appeal if the commissioner has not <br/>
<a id="pl.223.18"></a><var>223.18</var>made a determination in that time, the owner may appeal to Tax Court under chapter 271 <br/>
<a id="pl.223.19"></a><var>223.19</var>as if the appeal is from an order of the commissioner. <br/>
<a id="pl.223.20"></a><var>223.20</var>    (b) If the commissioner determines the land is to be removed from the sustainable <br/>
<a id="pl.223.21"></a><var>223.21</var>forest incentive program, the claimant is liable for payment to the commissioner in the <br/>
<a id="pl.223.22"></a><var>223.22</var>amount equal to the payments received under this chapter for the previous four-year <br/>
<a id="pl.223.23"></a><var>223.23</var>period, plus interest. The claimant has 90 days to satisfy the payment for removal of land <br/>
<a id="pl.223.24"></a><var>223.24</var>from the sustainable forest incentive program under this section. If the penalty is not paid <br/>
<a id="pl.223.25"></a><var>223.25</var>within the 90-day period under this paragraph, the commissioner shall certify the amount <br/>
<a id="pl.223.26"></a><var>223.26</var>to the county auditor for collection as a part of the general ad valorem real property taxes <br/>
<a id="pl.223.27"></a><var>223.27</var>on the land in the following taxes payable year.<br/>
<a id="pl.223.28"></a><var>223.28</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.49.0"></a><a id="pl.223.29"></a><var>223.29</var>    Sec. 49. <b>[290C.13] APPEALS.</b><br/>
<a id="pl.223.30"></a><var>223.30</var>    Subdivision 1. <b>Claimant right to reconsideration.</b> A claimant may obtain <br/>
<a id="pl.223.31"></a><var>223.31</var>reconsideration by the commissioner of a determination removing enrolled land from the <br/>
<a id="pl.223.32"></a><var>223.32</var>sustainable forest incentive program, a determination denying an application to enroll land <br/>
<a id="pl.223.33"></a><var>223.33</var>in the program, or a denial of part or all of an incentive payment by filing an administrative <br/>
<a id="pl.224.1"></a><var>224.1</var>appeal under subdivision 4. A claimant cannot obtain reconsideration under this section if <br/>
<a id="pl.224.2"></a><var>224.2</var>the action taken by the commissioner is the outcome of an administrative appeal.<br/>
<a id="pl.224.3"></a><var>224.3</var>    Subd. 2. <b>Appeal by claimant.</b> A claimant who wishes to seek administrative review <br/>
<a id="pl.224.4"></a><var>224.4</var>must follow the procedures in subdivision 4.<br/>
<a id="pl.224.5"></a><var>224.5</var>    Subd. 3. <b>Notice date.</b> For purposes of this section, the term "notice date" means <br/>
<a id="pl.224.6"></a><var>224.6</var>the date of the determination removing enrolled land or the date of the notice denying an <br/>
<a id="pl.224.7"></a><var>224.7</var>application to enroll land or denying part or all of an incentive payment.<br/>
<a id="pl.224.8"></a><var>224.8</var>    Subd. 4. <b>Time and content for administrative appeal.</b> Within 60 days after the <br/>
<a id="pl.224.9"></a><var>224.9</var>notice date, the claimant must file a written appeal with the commissioner. The appeal <br/>
<a id="pl.224.10"></a><var>224.10</var>need not be in any particular form but must contain the following information:<br/>
<a id="pl.224.11"></a><var>224.11</var>    (1) name and address of the claimant;<br/>
<a id="pl.224.12"></a><var>224.12</var>    (2) if a corporation, the state of incorporation of the claimant, and the principal <br/>
<a id="pl.224.13"></a><var>224.13</var>place of business of the corporation;<br/>
<a id="pl.224.14"></a><var>224.14</var>    (3) the Minnesota or federal business identification number or Social Security <br/>
<a id="pl.224.15"></a><var>224.15</var>number of the claimant;<br/>
<a id="pl.224.16"></a><var>224.16</var>    (4) the date;<br/>
<a id="pl.224.17"></a><var>224.17</var>    (5) the periods involved and the amount of payment involved for each year or period;<br/>
<a id="pl.224.18"></a><var>224.18</var>    (6) the findings in the notice that the claimant disputes;<br/>
<a id="pl.224.19"></a><var>224.19</var>    (7) a summary statement that the claimant relies on for each exception; and<br/>
<a id="pl.224.20"></a><var>224.20</var>    (8) the claimant's signature or signature of the claimant's duly authorized agent.<br/>
<a id="pl.224.21"></a><var>224.21</var>    Subd. 5. <b>Extensions.</b> When requested in writing and within the time allowed for <br/>
<a id="pl.224.22"></a><var>224.22</var>filing an administrative appeal, the commissioner may extend the time for filing an appeal <br/>
<a id="pl.224.23"></a><var>224.23</var>for a period not more than 30 days from the expiration of the 60 days from the notice date.<br/>
<a id="pl.224.24"></a><var>224.24</var>    Subd. 6. <b>Determination of appeal.</b> On the basis of applicable law and available <br/>
<a id="pl.224.25"></a><var>224.25</var>information, the commissioner shall determine the validity, if any, in whole or in part, <br/>
<a id="pl.224.26"></a><var>224.26</var>of the appeal and notify the claimant of the decision. This notice must be in writing <br/>
<a id="pl.224.27"></a><var>224.27</var>and contain the basis for the determination.<br/>
<a id="pl.224.28"></a><var>224.28</var>    Subd. 7. <b>Agreement determining issues under appeal.</b> When it appears to be in <br/>
<a id="pl.224.29"></a><var>224.29</var>the best interests of the state, the commissioner may settle the amount of any incentive <br/>
<a id="pl.224.30"></a><var>224.30</var>payments, payments owed by the claimant under section 290C.11, paragraph (b), penalties, <br/>
<a id="pl.224.31"></a><var>224.31</var>or interest that the commissioner has under consideration by virtue of an appeal filed <br/>
<a id="pl.224.32"></a><var>224.32</var>under this section. An agreement must be in writing and signed by the commissioner and <br/>
<a id="pl.224.33"></a><var>224.33</var>the claimant, or the claimant's representative authorized by the claimant to enter into an <br/>
<a id="pl.224.34"></a><var>224.34</var>agreement. The agreement is final and conclusive and, except upon a showing of fraud or <br/>
<a id="pl.224.35"></a><var>224.35</var>malfeasance, or misrepresentation of a material fact, the case must not be reopened as to <br/>
<a id="pl.224.36"></a><var>224.36</var>the matters agreed upon.<br/>
<a id="pl.225.1"></a><var>225.1</var>    Subd. 8. <b>Appeal to Tax Court.</b> Within 60 days after the commissioner denies <br/>
<a id="pl.225.2"></a><var>225.2</var>an appeal, or within 120 days after the commissioner received a written appeal if the <br/>
<a id="pl.225.3"></a><var>225.3</var>commissioner has not made a determination in that time, the claimant may appeal to Tax <br/>
<a id="pl.225.4"></a><var>225.4</var>Court under chapter 271 as if the appeal is from an order of the commissioner.<br/>
<a id="pl.225.5"></a><var>225.5</var>    Subd. 9. <b>Exemption from Administrative Procedure Act.</b> This section is not <br/>
<a id="pl.225.6"></a><var>225.6</var>subject to chapter 14.<br/>
<a id="pl.225.7"></a><var>225.7</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.13.50.0"></a><a id="pl.225.8"></a><var>225.8</var>    Sec. 50. <b>REPEALER.</b><br/>
<a id="pl.225.9"></a><var>225.9</var>(a) Minnesota Statutes 2006, section 270.073, is repealed.<br/>
<a id="pl.225.10"></a><var>225.10</var>(b) Minnesota Statutes 2006, sections 270.41, subdivision 4; 270.43; 270.51; 270.52; <br/>
<a id="pl.225.11"></a><var>225.11</var>and 270.53, are repealed.<br/>
<a id="pl.225.12"></a><var>225.12</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.14.0.0"></a>

<a id="bill.14.1.0"></a><a id="pl.225.15"></a><var>225.15</var>    Section 1. Minnesota Statutes 2006, section 62I.06, subdivision 6, is amended to read:<br/>
<a id="pl.225.16"></a><var>225.16</var>    Subd. 6. <b>Deficits</b><b> Deficit assessments</b><b>.</b> The association shall certify to the <br/>
<a id="pl.225.17"></a><var>225.17</var>commissioner the estimated amount of any deficit remaining after the stabilization reserve <br/>
<a id="pl.225.18"></a><var>225.18</var>fund has been exhausted and payment of the maximum final premium for all policyholders <br/>
<a id="pl.225.19"></a><var>225.19</var>of the association. Within 60 days after the certification, the commissioner shall authorize <br/>
<a id="pl.225.20"></a><var>225.20</var>the association to recover the members' respective shares of the deficit by assessing <br/>
<a id="pl.225.21"></a><var>225.21</var>all members an amount sufficient to fully fund the obligations of the association. The <br/>
<a id="pl.225.22"></a><var>225.22</var>assessment of each member shall be determined in the manner provided in section 
         <statute_ref>62I.07</statute_ref>. <br/>
<a id="pl.225.23"></a><var>225.23</var>An assessment made pursuant to this section shall be deductible by the member from past <br/>
<a id="pl.225.24"></a><var>225.24</var>or future premium taxes due the state as provided in section 297I.20, subdivision 2. <br/>
<a id="pl.225.25"></a><var>225.25</var><b>EFFECTIVE DATE.</b>This section is effective for tax returns due after December <br/>
<a id="pl.225.26"></a><var>225.26</var>31, 2008.<br/>
<br/>
<a id="bill.14.2.0"></a><a id="pl.225.27"></a><var>225.27</var>    Sec. 2. Minnesota Statutes 2006, section 71A.04, subdivision 1, is amended to read:<br/>
<a id="pl.225.28"></a><var>225.28</var>    Subdivision 1. <b>Premium tax.</b> The attorney-in-fact, in lieu of all taxes, state, county, <br/>
<a id="pl.225.29"></a><var>225.29</var>and municipal, shall file with the commissioner of revenue all returns and pay to the <br/>
<a id="pl.225.30"></a><var>225.30</var>commissioner of revenue all amounts required under chapter 297I.<br/>
<a id="pl.225.31"></a><var>225.31</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.14.3.0"></a><a id="pl.226.1"></a><var>226.1</var>    Sec. 3. Minnesota Statutes 2006, section 287.22, is amended to read:<br/>
<a id="pl.226.2"></a><var>226.2</var><b>287.22 EXEMPTIONS.</b><br/>
<a id="pl.226.3"></a><var>226.3</var>    The tax imposed by section 
         <statute_ref>287.21</statute_ref> does not apply to: <br/>
<a id="pl.226.4"></a><var>226.4</var>    (1) An executory contract for the sale of real property under which the purchaser is <br/>
<a id="pl.226.5"></a><var>226.5</var>entitled to or does take possession of the real property, or any assignment or cancellation <br/>
<a id="pl.226.6"></a><var>226.6</var>of the contract;<br/>
<a id="pl.226.7"></a><var>226.7</var>    (2) A mortgage or an amendment, assignment, extension, partial release, or <br/>
<a id="pl.226.8"></a><var>226.8</var>satisfaction of a mortgage;<br/>
<a id="pl.226.9"></a><var>226.9</var>    (3) A will;<br/>
<a id="pl.226.10"></a><var>226.10</var>    (4) A plat;<br/>
<a id="pl.226.11"></a><var>226.11</var>    (5) A lease, amendment of lease, assignment of lease, or memorandum of lease;<br/>
<a id="pl.226.12"></a><var>226.12</var>    (6) A deed, instrument, or writing in which the United States or any agency or <br/>
<a id="pl.226.13"></a><var>226.13</var>instrumentality thereof is the grantor, assignor, transferor, conveyor, grantee, or assignee;<br/>
<a id="pl.226.14"></a><var>226.14</var>    (7) A deed for a cemetery lot or lots;<br/>
<a id="pl.226.15"></a><var>226.15</var>    (8) A deed of distribution by a personal representative;<br/>
<a id="pl.226.16"></a><var>226.16</var>    (9) A deed to or from a co-owner partitioning their undivided interest in the same <br/>
<a id="pl.226.17"></a><var>226.17</var>piece of real property;<br/>
<a id="pl.226.18"></a><var>226.18</var>    (10) A deed or other instrument of conveyance issued pursuant to a permanent <br/>
<a id="pl.226.19"></a><var>226.19</var>school fund land exchange under section 
         <statute_ref>92.121</statute_ref> and related laws; <br/>
<a id="pl.226.20"></a><var>226.20</var>    (11) A referee's or sheriff's certificate of sale in a mortgage or lien foreclosure sale;<br/>
<a id="pl.226.21"></a><var>226.21</var>    (12) A referee's, sheriff's, or certificate holder's certificate of redemption from a <br/>
<a id="pl.226.22"></a><var>226.22</var>mortgage or lien foreclosure sale issued to the redeeming mortgagor or lienee under <br/>
<a id="pl.226.23"></a><var>226.23</var>section 580.23 or other statute applicable to redemption by an owner of real property;<br/>
<a id="pl.226.24"></a><var>226.24</var>    (13) A deed, instrument, or writing which grants, creates, modifies, or terminates an <br/>
<a id="pl.226.25"></a><var>226.25</var>easement; and<br/>
<a id="pl.226.26"></a><var>226.26</var>    (14) A decree of marriage dissolution, as defined in section 
         <statute_ref>287.01, subdivision 4</statute_ref>, <br/>
<a id="pl.226.27"></a><var>226.27</var>or a deed or other instrument between the parties to the dissolution made pursuant to <br/>
<a id="pl.226.28"></a><var>226.28</var>the terms of the decree. <br/>
<a id="pl.226.29"></a><var>226.29</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.14.4.0"></a><a id="pl.226.30"></a><var>226.30</var>    Sec. 4. Minnesota Statutes 2006, section 287.2205, is amended to read:<br/>
<a id="pl.226.31"></a><var>226.31</var><b>287.2205 TAX-FORFEITED LAND.</b><br/>
<a id="pl.226.32"></a><var>226.32</var>    Before a state deed for tax-forfeited land may be issued, the deed tax must be paid <br/>
<a id="pl.226.33"></a><var>226.33</var>by the purchaser of tax-forfeited land whether the purchase is the result of a public <br/>
<a id="pl.226.34"></a><var>226.34</var>auction or private sale or a repurchase of tax-forfeited land. State agencies and local <br/>
<a id="pl.227.1"></a><var>227.1</var>units of government that acquire tax-forfeited land by purchase or any other means are <br/>
<a id="pl.227.2"></a><var>227.2</var>subject to this section. The deed tax is $1.65 for a conveyance of tax-forfeited lands to a <br/>
<a id="pl.227.3"></a><var>227.3</var>governmental subdivision for an authorized public use under section 282.01, subdivision <br/>
<a id="pl.227.4"></a><var>227.4</var>1a, or for redevelopment purposes under section 282.01, subdivision 1b.<br/>
<a id="pl.227.5"></a><var>227.5</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.14.5.0"></a><a id="pl.227.6"></a><var>227.6</var>    Sec. 5. Minnesota Statutes 2006, section 295.52, subdivision 4, is amended to read:<br/>
<a id="pl.227.7"></a><var>227.7</var>    Subd. 4. <b>Use tax; prescription drugs.</b> (a) A person that receives prescription drugs <br/>
<a id="pl.227.8"></a><var>227.8</var>for resale or use in Minnesota, other than from a wholesale drug distributor that is subject <br/>
<a id="pl.227.9"></a><var>227.9</var>to tax under subdivision 3, is subject to a tax equal to the price paid to the wholesale drug <br/>
<a id="pl.227.10"></a><var>227.10</var>distributor multiplied by the tax percentage specified in this section. Liability for the tax is <br/>
<a id="pl.227.11"></a><var>227.11</var>incurred when prescription drugs are received or delivered in Minnesota by the person.<br/>
<a id="pl.227.12"></a><var>227.12</var>    (b) A person that receives prescription drugs for use in Minnesota from a nonresident <br/>
<a id="pl.227.13"></a><var>227.13</var>pharmacy required to be registered under section 
<statute_ref>151.19</statute_ref> is subject to a tax equal to <br/>
<a id="pl.227.14"></a><var>227.14</var>the price paid by the nonresident pharmacy to the wholesale drug distributor or the <br/>
<a id="pl.227.15"></a><var>227.15</var>price received by the nonresident pharmacy, whichever is lower, multiplied by the tax <br/>
<a id="pl.227.16"></a><var>227.16</var>percentage specified in this section. Liability for the tax is incurred when prescription <br/>
<a id="pl.227.17"></a><var>227.17</var>drugs are received in Minnesota by the person.<br/>
<a id="pl.227.18"></a><var>227.18</var>    (c) (b) A tax imposed under this subdivision does not apply to purchases by an <br/>
<a id="pl.227.19"></a><var>227.19</var>individual for personal consumption.<br/>
<a id="pl.227.20"></a><var>227.20</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.14.6.0"></a><a id="pl.227.21"></a><var>227.21</var>    Sec. 6. Minnesota Statutes 2006, section 295.52, subdivision 4a, is amended to read:<br/>
<a id="pl.227.22"></a><var>227.22</var>    Subd. 4a. <b>Tax collection.</b> A wholesale drug distributor with nexus in Minnesota, <br/>
<a id="pl.227.23"></a><var>227.23</var>who is not subject to tax under subdivision 3, on all or a particular transaction or a <br/>
<a id="pl.227.24"></a><var>227.24</var>nonresident pharmacy with nexus in Minnesota, is required to collect the tax imposed <br/>
<a id="pl.227.25"></a><var>227.25</var>under subdivision 4, from the purchaser of the drugs and give the purchaser a receipt <br/>
<a id="pl.227.26"></a><var>227.26</var>for the tax paid. The tax collected shall be remitted to the commissioner in the manner <br/>
<a id="pl.227.27"></a><var>227.27</var>prescribed by section 
         <statute_ref>295.55, subdivision 3</statute_ref>. <br/>
<a id="pl.227.28"></a><var>227.28</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.14.7.0"></a><a id="pl.227.29"></a><var>227.29</var>    Sec. 7. Minnesota Statutes 2006, section 295.54, subdivision 2, is amended to read:<br/>
<a id="pl.227.30"></a><var>227.30</var>    Subd. 2. <b>Pharmacy refund.</b> A pharmacy may claim an annual refund against the <br/>
<a id="pl.227.31"></a><var>227.31</var>total amount of tax, if any, the pharmacy owes during that calendar year under section <br/>
<statute_ref><a id="pl.227.32"></a><var>227.32</var>295.52, subdivision 2
</statute_ref> 4. The refund shall equal the amount paid by the pharmacy to a <br/>
<a id="pl.228.1"></a><var>228.1</var>wholesale drug distributor subject to tax under section 
         <statute_ref>295.52, subdivision 3</statute_ref>, for legend <br/>
<a id="pl.228.2"></a><var>228.2</var>drugs delivered by the pharmacy outside of Minnesota, multiplied by the tax percentage <br/>
<a id="pl.228.3"></a><var>228.3</var>specified in section 
         <statute_ref>295.52</statute_ref>, subdivision 3. If the amount of the refund exceeds the tax <br/>
<a id="pl.228.4"></a><var>228.4</var>liability of the pharmacy under section 
         <statute_ref>295.52, subdivision 1b</statute_ref> 4, the commissioner <br/>
<a id="pl.228.5"></a><var>228.5</var>shall provide the pharmacy with a refund equal to the excess amount. Each qualifying <br/>
<a id="pl.228.6"></a><var>228.6</var>pharmacy must apply for the refund on the annual return as provided under section 
         <statute_ref>295.55, <br/>
<a id="pl.228.7"></a><var>228.7</var>subdivision 5
         </statute_ref>. The refund must be claimed within one year of the due date of the return 18 <br/>
<a id="pl.228.8"></a><var>228.8</var>months from the date the drugs were delivered outside of Minnesota. Interest on refunds <br/>
<a id="pl.228.9"></a><var>228.9</var>paid under this subdivision will begin to accrue 60 days after the date a claim for refund is <br/>
<a id="pl.228.10"></a><var>228.10</var>filed. For purposes of this subdivision, the date a claim is filed is the due date of the return <br/>
<a id="pl.228.11"></a><var>228.11</var>if a return is due or the date of the actual claim for refund, whichever is later. <br/>
<a id="pl.228.12"></a><var>228.12</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.14.8.0"></a><a id="pl.228.13"></a><var>228.13</var>    Sec. 8. Minnesota Statutes 2006, section 297F.06, subdivision 4, is amended to read:<br/>
<a id="pl.228.14"></a><var>228.14</var>    Subd. 4. <b>Tobacco products use tax.</b> The tobacco products use tax does not apply to <br/>
<a id="pl.228.15"></a><var>228.15</var>the possession, use, or storage of tobacco products that if (1) the tobacco products have an <br/>
<a id="pl.228.16"></a><var>228.16</var>aggregate cost in any calendar month to the consumer of $100 $50 or less, and (2) the <br/>
<a id="pl.228.17"></a><var>228.17</var>tobacco products were carried into this state by that consumer.<br/>
<a id="pl.228.18"></a><var>228.18</var><b>EFFECTIVE DATE.</b>This section is effective for the possession, use, or storage <br/>
<a id="pl.228.19"></a><var>228.19</var>of tobacco products after June 30, 2008.<br/>
<br/>
<a id="bill.14.9.0"></a><a id="pl.228.20"></a><var>228.20</var>    Sec. 9. Minnesota Statutes 2006, section 297F.25, is amended by adding a subdivision <br/>
<a id="pl.228.21"></a><var>228.21</var>to read:<br/>
<a id="pl.228.22"></a><var>228.22</var>    Subd. 3a. <b>Consumer use tax; use tax return; cigarette consumer.</b> (a) On or before <br/>
<a id="pl.228.23"></a><var>228.23</var>the 18th day of each calendar month, a consumer who, during the preceding calendar <br/>
<a id="pl.228.24"></a><var>228.24</var>month, has acquired title to or possession of cigarettes for use or storage in this state, upon <br/>
<a id="pl.228.25"></a><var>228.25</var>which the sales tax imposed by this section has not been paid, shall file a return with the <br/>
<a id="pl.228.26"></a><var>228.26</var>commissioner showing the quantity of cigarettes so acquired or possessed. The return <br/>
<a id="pl.228.27"></a><var>228.27</var>must be made in the form and manner prescribed by the commissioner, and must contain <br/>
<a id="pl.228.28"></a><var>228.28</var>any other information required by the commissioner. The return must be accompanied by <br/>
<a id="pl.228.29"></a><var>228.29</var>a remittance for the full unpaid sales tax liability shown by it.<br/>
<a id="pl.228.30"></a><var>228.30</var>    (b) The tax imposed under paragraph (a) does not apply if (1) the consumer has <br/>
<a id="pl.228.31"></a><var>228.31</var>acquired title to or possession of cigarettes for use or storage in this state in quantities <br/>
<a id="pl.228.32"></a><var>228.32</var>of 200 or fewer in the month, and (2) the cigarettes were carried into this state by that <br/>
<a id="pl.228.33"></a><var>228.33</var>consumer.<br/>
<a id="pl.229.1"></a><var>229.1</var><b>EFFECTIVE DATE.</b>This section is effective for cigarettes which a consumer has <br/>
<a id="pl.229.2"></a><var>229.2</var>acquired title to or possession of after June 30, 2008.<br/>
<br/>
<a id="bill.14.10.0"></a><a id="pl.229.3"></a><var>229.3</var>    Sec. 10. Minnesota Statutes 2006, section 297I.06, subdivision 1, is amended to read:<br/>
<a id="pl.229.4"></a><var>229.4</var>    Subdivision 1. <b>Insurance policies surcharge.</b> (a) Except as otherwise provided in <br/>
<a id="pl.229.5"></a><var>229.5</var>subdivision 2, each licensed insurer engaged in writing policies of homeowner's insurance <br/>
<a id="pl.229.6"></a><var>229.6</var>authorized in section 60A.06, subdivision 1, clause (1)(c), or commercial fire policies or <br/>
<a id="pl.229.7"></a><var>229.7</var>commercial nonliability policies shall collect a surcharge equal to 0.65 percent of the <br/>
<a id="pl.229.8"></a><var>229.8</var>gross premiums and assessments, less return premiums, on direct business received by <br/>
<a id="pl.229.9"></a><var>229.9</var>the company, or by its agents for it, for homeowner's insurance policies, commercial fire <br/>
<a id="pl.229.10"></a><var>229.10</var>policies, and commercial nonliability insurance policies in this state.<br/>
<a id="pl.229.11"></a><var>229.11</var>    (b) The surcharge amount collected under paragraph (a) or subdivision 2, paragraph <br/>
<a id="pl.229.12"></a><var>229.12</var>(b), may not be considered premium for any other purpose. The surcharge amount <br/>
<a id="pl.229.13"></a><var>229.13</var>under paragraph (a) must be separately stated on either a billing or policy declaration or <br/>
<a id="pl.229.14"></a><var>229.14</var>document containing similar information sent to an insured.<br/>
<a id="pl.229.15"></a><var>229.15</var>    (c) Amounts collected by the commissioner under this section must be deposited in <br/>
<a id="pl.229.16"></a><var>229.16</var>the fire safety account established pursuant to subdivision 3.<br/>
<a id="pl.229.17"></a><var>229.17</var><b>EFFECTIVE DATE.</b>This section is effective retroactively from July 1, 2007, and <br/>
<a id="pl.229.18"></a><var>229.18</var>applies to policies written or renewed on or after that date.<br/>
<br/>
<a id="bill.14.11.0"></a><a id="pl.229.19"></a><var>229.19</var>    Sec. 11. Minnesota Statutes 2006, section 297I.06, subdivision 2, is amended to read:<br/>
<a id="pl.229.20"></a><var>229.20</var>    Subd. 2. <b>Exemptions.</b> (a) This section does not apply to a farmers' mutual fire <br/>
<a id="pl.229.21"></a><var>229.21</var>insurance company or township mutual fire insurance company in Minnesota organized <br/>
<a id="pl.229.22"></a><var>229.22</var>under chapter 67A.<br/>
<a id="pl.229.23"></a><var>229.23</var>    (b) An insurer described in section 297I.05, subdivisions 3 and 4, authorized to <br/>
<a id="pl.229.24"></a><var>229.24</var>transact business in Minnesota shall elect to remit to the Department of Revenue for <br/>
<a id="pl.229.25"></a><var>229.25</var>deposit in the fire safety account either (1) the surcharge amount collected imposed under <br/>
<a id="pl.229.26"></a><var>229.26</var>this section subdivision 1 on all premiums subject to that surcharge, or (2) a surcharge of <br/>
<a id="pl.229.27"></a><var>229.27</var>one-half of one percent on the gross fire premiums and assessments, less return premiums, <br/>
<a id="pl.229.28"></a><var>229.28</var>on all direct business received by the insurer or agents of the insurer in Minnesota, in <br/>
<a id="pl.229.29"></a><var>229.29</var>cash or otherwise, during the year. <br/>
<a id="pl.229.30"></a><var>229.30</var>    (c) The election must be made by December 31 of each year for insurance policies <br/>
<a id="pl.229.31"></a><var>229.31</var>written or renewed in the succeeding calendar year. An insurer who elects to remit the <br/>
<a id="pl.229.32"></a><var>229.32</var>one-half of one percent surcharge on gross fire premiums and assessments must not charge <br/>
<a id="pl.229.33"></a><var>229.33</var>the insured the surcharge imposed under subdivision 1.<br/>
<a id="pl.230.1"></a><var>230.1</var>    (c) (d) For purposes of this subdivision, "gross fire premiums and assessments" <br/>
<a id="pl.230.2"></a><var>230.2</var>includes premiums on policies covering fire risks only on automobiles, whether written or <br/>
<a id="pl.230.3"></a><var>230.3</var>under floater form or otherwise.<br/>
<a id="pl.230.4"></a><var>230.4</var><b>EFFECTIVE DATE.</b>This section is effective retroactively from July 1, 2007, and <br/>
<a id="pl.230.5"></a><var>230.5</var>applies to insurance policies written or renewed on or after that date.<br/>
<br/>
<a id="bill.14.12.0"></a><a id="pl.230.6"></a><var>230.6</var>    Sec. 12. Minnesota Statutes 2006, section 297I.20, subdivision 2, is amended to read:<br/>
<a id="pl.230.7"></a><var>230.7</var>    Subd. 2. <b>Joint Underwriting Association offset.</b> An insurance company may offset <br/>
<a id="pl.230.8"></a><var>230.8</var>against its premium tax liability to this state any amount paid for an assessment made <br/>
<a id="pl.230.9"></a><var>230.9</var>pursuant to section 
         <statute_ref>62I.06, subdivision 6</statute_ref>, shall be deductible by the member from past <br/>
<a id="pl.230.10"></a><var>230.10</var>or future premium taxes due the state. The offset against premium tax liability must be <br/>
<a id="pl.230.11"></a><var>230.11</var>claimed beginning with the taxable year that the assessment is paid. To the extent that the <br/>
<a id="pl.230.12"></a><var>230.12</var>allowable offset exceeds the tax liability, the remaining offset must be carried forward to <br/>
<a id="pl.230.13"></a><var>230.13</var>succeeding taxable years until the entire offset has been credited against the insurance <br/>
<a id="pl.230.14"></a><var>230.14</var>company's liability for premium tax under this chapter. <br/>
<a id="pl.230.15"></a><var>230.15</var><b>EFFECTIVE DATE.</b>This section is effective for tax returns due after December <br/>
<a id="pl.230.16"></a><var>230.16</var>31, 2008.<br/>
<br/>
<a id="bill.14.13.0"></a><a id="pl.230.17"></a><var>230.17</var>    Sec. 13. Minnesota Statutes 2006, section 297I.40, subdivision 5, is amended to read:<br/>
<a id="pl.230.18"></a><var>230.18</var>    Subd. 5. <b>Definition of tax.</b> The term "tax" as used in this section means the tax <br/>
<a id="pl.230.19"></a><var>230.19</var>imposed by section 
         <statute_ref>297I.05, subdivisions 1 to 6</statute_ref>, 11, and 12, paragraphs (a), clauses (1) <br/>
<a id="pl.230.20"></a><var>230.20</var>to (5), (b), and (e) (d), without regard to the retaliatory provisions of section 
<statute_ref>297I.05, <br/>
<a id="pl.230.21"></a><var>230.21</var>subdivision 11
</statute_ref>, and the less any offset in section 
         <statute_ref>297I.20</statute_ref>. <br/>
<a id="pl.230.22"></a><var>230.22</var><b>EFFECTIVE DATE.</b>This section is effective for tax returns due after December <br/>
<a id="pl.230.23"></a><var>230.23</var>31, 2008.<br/>
<br/>
<a id="bill.15.0.0"></a>

<a id="bill.15.1.0"></a><a id="pl.230.26"></a><var>230.26</var>    Section 1. Minnesota Statutes 2006, section 16D.04, subdivision 1, is amended to read:<br/>
<a id="pl.230.27"></a><var>230.27</var>    Subdivision 1. <b>Duties.</b> The commissioner shall provide services to the state and its <br/>
<a id="pl.230.28"></a><var>230.28</var>referring agencies to collect debts owed the state referred for collection under this chapter. <br/>
<a id="pl.230.29"></a><var>230.29</var>The commissioner is not a collection agency as defined by section 
         <statute_ref>332.31, subdivision 3</statute_ref>, <br/>
<a id="pl.230.30"></a><var>230.30</var>and is not licensed, bonded, or regulated by the commissioner of commerce under sections <br/>
<statute_ref><a id="pl.230.31"></a><var>230.31</var>332.31
         </statute_ref> to 
         <statute_ref>332.35</statute_ref> or 
         <statute_ref>332.38</statute_ref> to 
         <statute_ref>332.45</statute_ref>. The commissioner is subject to section 
         <statute_ref>332.37</statute_ref>, <br/>
<a id="pl.231.1"></a><var>231.1</var>except clause (9), (10), (12), or (19). Debts referred to the commissioner for collection <br/>
<a id="pl.231.2"></a><var>231.2</var>under section 
         <statute_ref>256.9792</statute_ref> may in turn be referred by the commissioner to the enterprise. <br/>
<a id="pl.231.3"></a><var>231.3</var>An audited financial statement may not be required as a condition of debt placement with <br/>
<a id="pl.231.4"></a><var>231.4</var>a private agency if the private agency: (1) has errors and omissions coverage under a <br/>
<a id="pl.231.5"></a><var>231.5</var>professional liability policy in an amount of at least $1,000,000; or (2) has a fidelity bond <br/>
<a id="pl.231.6"></a><var>231.6</var>to cover actions of its employees, in an amount of at least $100,000. In cases of debts <br/>
<a id="pl.231.7"></a><var>231.7</var>referred under section 
         <statute_ref>256.9792</statute_ref>, the provisions of this chapter and section 
         <statute_ref>256.9792</statute_ref> apply <br/>
<a id="pl.231.8"></a><var>231.8</var>to the extent they are not in conflict. If they are in conflict, the provisions of section <br/>
<statute_ref><a id="pl.231.9"></a><var>231.9</var>256.9792
         </statute_ref> control. For purposes of this chapter, the referring agency for such debts remains <br/>
<a id="pl.231.10"></a><var>231.10</var>the Department of Human Services. <br/>
<a id="pl.231.11"></a><var>231.11</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.15.2.0"></a><a id="pl.231.12"></a><var>231.12</var>    Sec. 2. Minnesota Statutes 2006, section 16D.04, subdivision 2, is amended to read:<br/>
<a id="pl.231.13"></a><var>231.13</var>    Subd. 2. <b>Agency participation.</b> (a) A referring agency may, at its option, must <br/>
<a id="pl.231.14"></a><var>231.14</var>refer, by electronic means, debts to the commissioner for collection. The ultimate <br/>
<a id="pl.231.15"></a><var>231.15</var>Responsibility for the debt, including the reporting of the debt to the commissioner of <br/>
<a id="pl.231.16"></a><var>231.16</var>finance and the decision with regard to the continuing collection and uncollectibility of the <br/>
<a id="pl.231.17"></a><var>231.17</var>debt, remains with the referring agency.<br/>
<a id="pl.231.18"></a><var>231.18</var>    (b) Before a debt becomes 121 days past due, a referring agency may refer the <br/>
<a id="pl.231.19"></a><var>231.19</var>debt to the commissioner for collection at any time after a debt becomes delinquent and <br/>
<a id="pl.231.20"></a><var>231.20</var>uncontested and the debtor has no further administrative appeal of the amount of the <br/>
<a id="pl.231.21"></a><var>231.21</var>debt. When a debt owed to a state referring agency becomes 121 days past due, the state <br/>
<a id="pl.231.22"></a><var>231.22</var>referring agency must refer the debt to the commissioner for collection. This requirement <br/>
<a id="pl.231.23"></a><var>231.23</var>does not apply if there is a dispute over the amount or validity of the debt, if the debt is the <br/>
<a id="pl.231.24"></a><var>231.24</var>subject of legal action or administrative proceedings, or the agency determines that the <br/>
<a id="pl.231.25"></a><var>231.25</var>debtor is adhering to acceptable payment arrangements. The commissioner, in consultation <br/>
<a id="pl.231.26"></a><var>231.26</var>with the commissioner of finance, may provide that certain types of debt need not be <br/>
<a id="pl.231.27"></a><var>231.27</var>referred to the commissioner for collection under this paragraph. Methods and procedures <br/>
<a id="pl.231.28"></a><var>231.28</var>for referral must follow internal guidelines prepared by the commissioner of finance.<br/>
<a id="pl.231.29"></a><var>231.29</var>    (c) If the referring agency is a court, the court must furnish a debtor's Social Security <br/>
<a id="pl.231.30"></a><var>231.30</var>number to the commissioner when the court refers the debt.<br/>
<a id="pl.231.31"></a><var>231.31</var><b>EFFECTIVE DATE.</b>This section is effective for debts referred after December <br/>
<a id="pl.231.32"></a><var>231.32</var>31, 2008.<br/>
<br/>
<a id="bill.15.3.0"></a><a id="pl.231.33"></a><var>231.33</var>    Sec. 3. Minnesota Statutes 2006, section 16D.11, subdivision 2, is amended to read:<br/>
<a id="pl.232.1"></a><var>232.1</var>    Subd. 2. <b>Computation.</b> At the time a debt is referred, the amount of collection <br/>
<a id="pl.232.2"></a><var>232.2</var>costs is equal to 15 17 percent of the debt, or 25 percent of the debt remaining unpaid if <br/>
<a id="pl.232.3"></a><var>232.3</var>the commissioner or private collection agency has to take enforced collection action <br/>
<a id="pl.232.4"></a><var>232.4</var>by serving a summons and complaint on or entering judgment against the debtor, or by <br/>
<a id="pl.232.5"></a><var>232.5</var>utilizing any of the remedies authorized under section 
<statute_ref>16D.08, subdivision 2</statute_ref>, except for <br/>
<a id="pl.232.6"></a><var>232.6</var>the remedies in sections 
<statute_ref>270C.32</statute_ref> and 
<statute_ref>270C.65</statute_ref> or when referred by the commissioner for <br/>
<a id="pl.232.7"></a><var>232.7</var>additional collection activity by a private collection agency. If, after referral of a debt to <br/>
<a id="pl.232.8"></a><var>232.8</var>a private collection agency, the debtor requests cancellation of collection costs under <br/>
<a id="pl.232.9"></a><var>232.9</var>subdivision 3, the debt must be returned to the commissioner for resolution of the request.<br/>
<a id="pl.232.10"></a><var>232.10</var><b>EFFECTIVE DATE.</b>This section is effective for debts referred after December <br/>
<a id="pl.232.11"></a><var>232.11</var>31, 2008.<br/>
<br/>
<a id="bill.15.4.0"></a><a id="pl.232.12"></a><var>232.12</var>    Sec. 4. Minnesota Statutes 2006, section 16D.11, subdivision 7, is amended to read:<br/>
<a id="pl.232.13"></a><var>232.13</var>    Subd. 7. <b>Adjustment of rate.</b> By June 1 of each year, the commissioner of finance <br/>
<a id="pl.232.14"></a><var>232.14</var>shall determine the rate of collection costs for debts referred to the enterprise during <br/>
<a id="pl.232.15"></a><var>232.15</var>the next fiscal year. The rate is a percentage of the debts in an amount that most nearly <br/>
<a id="pl.232.16"></a><var>232.16</var>equals the costs of the enterprise necessary to process and collect referred debts under this <br/>
<a id="pl.232.17"></a><var>232.17</var>chapter. In no event shall the rate of collection costs when a debt is first referred exceed <br/>
<a id="pl.232.18"></a><var>232.18</var>three-fifths of the maximum collection costs, and in no event shall the rate of the maximum <br/>
<a id="pl.232.19"></a><var>232.19</var>collection costs exceed 25 percent of the debt. Determination of the rate of collection costs <br/>
<a id="pl.232.20"></a><var>232.20</var>under this section is not subject to the fee setting requirements of section 
         <statute_ref>16A.1285</statute_ref>. <br/>
<a id="pl.232.21"></a><var>232.21</var><b>EFFECTIVE DATE.</b>This section is effective January 1, 2009.<br/>
<br/>
<a id="bill.15.5.0"></a><a id="pl.232.22"></a><var>232.22</var>    Sec. 5. <b>[270C.435] REFUNDS NOT SUBJECT TO ATTACHMENT OR </b><br/>
<a id="pl.232.23"></a><var>232.23</var><b>GARNISHMENT.</b><br/>
<a id="pl.232.24"></a><var>232.24</var>    No amount of a tax refund or other payment payable by the commissioner to <br/>
<a id="pl.232.25"></a><var>232.25</var>a taxpayer is assignable or subject to execution, levy, attachment, garnishment, lien <br/>
<a id="pl.232.26"></a><var>232.26</var>foreclosure, or other legal process, except as specifically provided by law.<br/>
<a id="pl.232.27"></a><var>232.27</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.15.6.0"></a><a id="pl.232.28"></a><var>232.28</var>    Sec. 6. Minnesota Statutes 2006, section 270C.446, subdivision 2, is amended to read:<br/>
<a id="pl.232.29"></a><var>232.29</var>    Subd. 2. <b>Required and excluded tax preparers.</b> (a) Subject to the limitations <br/>
<a id="pl.232.30"></a><var>232.30</var>of paragraph (b), the commissioner must publish lists of tax preparers as defined in <br/>
<a id="pl.232.31"></a><var>232.31</var>section 289A.60, subdivision 13, paragraph (f), who have been convicted under section <br/>
<statute_ref><a id="pl.233.1"></a><var>233.1</var>289A.63
         </statute_ref> or assessed penalties in excess of $1,000 under section 289A.60, subdivision <br/>
<a id="pl.233.2"></a><var>233.2</var>13, paragraph (a).<br/>
<a id="pl.233.3"></a><var>233.3</var>    (b) For the purposes of this section, tax preparers are not subject to publication if:<br/>
<a id="pl.233.4"></a><var>233.4</var>    (1) an administrative or court action contesting the penalty has been filed or served <br/>
<a id="pl.233.5"></a><var>233.5</var>and is unresolved at the time when notice would be given under subdivision 3;<br/>
<a id="pl.233.6"></a><var>233.6</var>    (2) an appeal period to contest the penalty has not expired; or<br/>
<a id="pl.233.7"></a><var>233.7</var>    (3) the commissioner has been notified that the tax preparer is deceased.<br/>
<a id="pl.233.8"></a><var>233.8</var><b>EFFECTIVE DATE.</b>This section is effective for penalties on returns filed after <br/>
<a id="pl.233.9"></a><var>233.9</var>December 31, 2008.<br/>
<br/>
<a id="bill.15.7.0"></a><a id="pl.233.10"></a><var>233.10</var>    Sec. 7. Minnesota Statutes 2006, section 270C.56, subdivision 1, is amended to read:<br/>
<a id="pl.233.11"></a><var>233.11</var>    Subdivision 1. <b>Liability imposed.</b> A person who, either singly or jointly with <br/>
<a id="pl.233.12"></a><var>233.12</var>others, has the control of, supervision of, or responsibility for filing returns or reports, <br/>
<a id="pl.233.13"></a><var>233.13</var>paying taxes, or collecting or withholding and remitting taxes and who fails to do so, or <br/>
<a id="pl.233.14"></a><var>233.14</var>a person who is liable under any other law, is liable for the payment of taxes, penalties, <br/>
<a id="pl.233.15"></a><var>233.15</var>and interest arising under chapters 295, 296A, 297A, 297F, and 297G, or sections 
         <statute_ref>290.92</statute_ref> <br/>
<a id="pl.233.16"></a><var>233.16</var>and 
         <statute_ref>297E.02</statute_ref>, and, for the taxes listed in this subdivision, the applicable penalties for <br/>
<a id="pl.233.17"></a><var>233.17</var>nonpayment under section 289A.60.<br/>
<a id="pl.233.18"></a><var>233.18</var><b>EFFECTIVE DATE.</b>This section is effective for personal liability assessments <br/>
<a id="pl.233.19"></a><var>233.19</var>made after the day of final enactment.<br/>
<br/>
<a id="bill.15.8.0"></a><a id="pl.233.20"></a><var>233.20</var>    Sec. 8. Minnesota Statutes 2006, section 270C.63, subdivision 9, is amended to read:<br/>
<a id="pl.233.21"></a><var>233.21</var>    Subd. 9. <b>Period of limitations.</b> The lien imposed by this section shall, <br/>
<a id="pl.233.22"></a><var>233.22</var>notwithstanding any other provision of law to the contrary, be enforceable from the time <br/>
<a id="pl.233.23"></a><var>233.23</var>the lien arises and for ten years from the date of filing the notice of lien, which must be <br/>
<a id="pl.233.24"></a><var>233.24</var>filed by the commissioner within five years after the date of assessment of the tax or final <br/>
<a id="pl.233.25"></a><var>233.25</var>administrative or judicial determination of the assessment. A notice of lien filed at the <br/>
<a id="pl.233.26"></a><var>233.26</var>Office of the Secretary of State may be transcribed to any county within ten years after the <br/>
<a id="pl.233.27"></a><var>233.27</var>date of its filing, but the transcription does not extend the period during which the lien is <br/>
<a id="pl.233.28"></a><var>233.28</var>enforceable. A notice of lien filed in one county may be transcribed to the secretary of <br/>
<a id="pl.233.29"></a><var>233.29</var>state or to any other county within ten years after the date of its filing, but the transcription <br/>
<a id="pl.233.30"></a><var>233.30</var>shall not extend the period during which the lien is enforceable. A notice of lien may be <br/>
<a id="pl.233.31"></a><var>233.31</var>renewed by the commissioner before the expiration of the ten-year period for an additional <br/>
<a id="pl.233.32"></a><var>233.32</var>ten years. The taxpayer must receive written notice of the renewal.<br/>
<a id="pl.234.1"></a><var>234.1</var><b>EFFECTIVE DATE.</b>This section is effective for liens transcribed after the day <br/>
<a id="pl.234.2"></a><var>234.2</var>of final enactment.<br/>
<br/>
<a id="bill.15.9.0"></a><a id="pl.234.3"></a><var>234.3</var>    Sec. 9. Minnesota Statutes 2007 Supplement, section 424A.10, subdivision 3, is <br/>
<a id="pl.234.4"></a><var>234.4</var>amended to read:<br/>
<a id="pl.234.5"></a><var>234.5</var>    Subd. 3. <b>State reimbursement.</b> (a) By February 15 of each year, the treasurer of <br/>
<a id="pl.234.6"></a><var>234.6</var>the relief association shall apply to the commissioner of revenue Each year, to be eligible <br/>
<a id="pl.234.7"></a><var>234.7</var>for state reimbursement of the amount of supplemental benefits paid under subdivision 2 <br/>
<a id="pl.234.8"></a><var>234.8</var>during the preceding calendar year, the relief association must apply to the commissioner <br/>
<a id="pl.234.9"></a><var>234.9</var>of revenue by February 15. By March 15, the commissioner shall reimburse the relief <br/>
<a id="pl.234.10"></a><var>234.10</var>association for the amount of the supplemental benefits paid to qualified recipients and to <br/>
<a id="pl.234.11"></a><var>234.11</var>survivors of deceased active or deferred volunteer firefighters. <br/>
<a id="pl.234.12"></a><var>234.12</var>    (b) The commissioner of revenue shall prescribe the form of and supporting <br/>
<a id="pl.234.13"></a><var>234.13</var>information that must be supplied as part of the application for state reimbursement. <br/>
<a id="pl.234.14"></a><var>234.14</var>The commissioner of revenue shall reimburse the relief association by paying the <br/>
<a id="pl.234.15"></a><var>234.15</var>reimbursement amount to the treasurer of the municipality where the association is located. <br/>
<a id="pl.234.16"></a><var>234.16</var>Within 30 days after receipt, the municipal treasurer shall transmit the state reimbursement <br/>
<a id="pl.234.17"></a><var>234.17</var>to the treasurer of the association if the association has filed a financial report with the <br/>
<a id="pl.234.18"></a><var>234.18</var>municipality. If the relief association has not filed a financial report with the municipality, <br/>
<a id="pl.234.19"></a><var>234.19</var>the municipal treasurer shall delay transmission of the reimbursement payment to the <br/>
<a id="pl.234.20"></a><var>234.20</var>association until the complete financial report is filed. If the association has dissolved or <br/>
<a id="pl.234.21"></a><var>234.21</var>has been removed as a trustee of state aid, the treasurer shall deposit the money in a <br/>
<a id="pl.234.22"></a><var>234.22</var>special account in the municipal treasury, and the money may be disbursed only for the <br/>
<a id="pl.234.23"></a><var>234.23</var>purposes and in the manner provided in section 424A.08. When paid to the association,<br/>
<a id="pl.234.24"></a><var>234.24</var>    (c) the reimbursement payment must be deposited in the special fund of the relief <br/>
<a id="pl.234.25"></a><var>234.25</var>association. <br/>
<a id="pl.234.26"></a><var>234.26</var>    (d) (c) A sum sufficient to make the payments is appropriated from the general fund <br/>
<a id="pl.234.27"></a><var>234.27</var>to the commissioner of revenue.<br/>
<a id="pl.234.28"></a><var>234.28</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br/>
<br/>
<a id="bill.16.0.0"></a>

<a id="bill.16.1.0"></a><a id="pl.234.31"></a><var>234.31</var>    Section 1. Minnesota Statutes 2006, section 3.987, subdivision 1, is amended to read:<br/>
<a id="pl.234.32"></a><var>234.32</var>    Subdivision 1. <b>Local impact notes.</b> The commissioner of finance shall coordinate <br/>
<a id="pl.234.33"></a><var>234.33</var>the development of a local impact note for any proposed legislation introduced after June <br/>
<a id="pl.235.1"></a><var>235.1</var>30, 1997, or any rule proposed after December 31, 1999, upon request of the chair or the <br/>
<a id="pl.235.2"></a><var>235.2</var>ranking minority member of either legislative Tax Committee. Upon receipt of a request <br/>
<a id="pl.235.3"></a><var>235.3</var>to prepare a local impact note, the commissioner must notify the authors of the proposed <br/>
<a id="pl.235.4"></a><var>235.4</var>legislation or, for an administrative rule, the head of the relevant executive agency or <br/>
<a id="pl.235.5"></a><var>235.5</var>department, that the request has been made. The local impact note must be made available <br/>
<a id="pl.235.6"></a><var>235.6</var>to the public upon request. If the action is among the exceptions listed in section 
         <statute_ref>3.988</statute_ref>, <br/>
<a id="pl.235.7"></a><var>235.7</var>a local impact note need not be requested nor prepared. The commissioner shall make <br/>
<a id="pl.235.8"></a><var>235.8</var>a reasonable and timely estimate of the local fiscal impact on each type of political <br/>
<a id="pl.235.9"></a><var>235.9</var>subdivision that would result from the proposed legislation. The commissioner of finance <br/>
<a id="pl.235.10"></a><var>235.10</var>may require any political subdivision or the commissioner of an administrative agency <br/>
<a id="pl.235.11"></a><var>235.11</var>of the state to supply in a timely manner any information determined to be necessary to <br/>
<a id="pl.235.12"></a><var>235.12</var>determine local fiscal impact. The political subdivision, its representative association, or <br/>
<a id="pl.235.13"></a><var>235.13</var>commissioner shall convey the requested information to the commissioner of finance with <br/>
<a id="pl.235.14"></a><var>235.14</var>a signed statement to the effect that the information is accurate and complete to the best <br/>
<a id="pl.235.15"></a><var>235.15</var>of its ability. The political subdivision, its representative association, or commissioner, <br/>
<a id="pl.235.16"></a><var>235.16</var>when requested, shall update its determination of local fiscal impact based on actual <br/>
<a id="pl.235.17"></a><var>235.17</var>cost or revenue figures, improved estimates, or both. Upon completion of the note, the <br/>
<a id="pl.235.18"></a><var>235.18</var>commissioner must provide a copy to the authors of the proposed legislation or, for an <br/>
<a id="pl.235.19"></a><var>235.19</var>administrative rule, to the head of the relevant executive agency or department. <br/>
<br/>
<a id="bill.16.2.0"></a><a id="pl.235.20"></a><var>235.20</var>    Sec. 2. Minnesota Statutes 2006, section 3.988, subdivision 3, is amended to read:<br/>
<a id="pl.235.21"></a><var>235.21</var>    Subd. 3. <b>Miscellaneous exceptions.</b> A local impact note or an attachment as <br/>
<a id="pl.235.22"></a><var>235.22</var>provided in section 
         <statute_ref>3.987, subdivision 2</statute_ref>, need not be prepared for the cost of a mandated <br/>
<a id="pl.235.23"></a><var>235.23</var>action if the law, including a rulemaking, containing the mandate: <br/>
<a id="pl.235.24"></a><var>235.24</var>    (1) accommodates a specific local request;<br/>
<a id="pl.235.25"></a><var>235.25</var>    (2) results in no new local government duties;<br/>
<a id="pl.235.26"></a><var>235.26</var>    (3) leads to revenue losses from exemptions to taxes;<br/>
<a id="pl.235.27"></a><var>235.27</var>    (4) provided only clarifying or conforming, nonsubstantive charges on local <br/>
<a id="pl.235.28"></a><var>235.28</var>government;<br/>
<a id="pl.235.29"></a><var>235.29</var>    (5) imposes additional net local costs that are minor (an amount less than or equal <br/>
<a id="pl.235.30"></a><var>235.30</var>to one-half of one percent of the local revenue base as defined in section 
         <statute_ref>477A.011, <br/>
<a id="pl.235.31"></a><var>235.31</var>subdivision 27
         </statute_ref>, or $50,000, whichever is less for any single local government if the <br/>
<a id="pl.235.32"></a><var>235.32</var>mandate does not apply statewide or less than $1,000,000 if the mandate is statewide); <br/>
<a id="pl.235.33"></a><var>235.33</var>    (6) is a law or executive order enacted before July 1, 1997, or a rule initially <br/>
<a id="pl.235.34"></a><var>235.34</var>implementing a law enacted before July 1, 1997;<br/>
<a id="pl.236.1"></a><var>236.1</var>    (7) implements something other than a law or executive order, such as a federal, <br/>
<a id="pl.236.2"></a><var>236.2</var>court, or voter-approved mandate;<br/>
<a id="pl.236.3"></a><var>236.3</var>    (8) results in savings that equal or exceed costs;<br/>
<a id="pl.236.4"></a><var>236.4</var>    (9) requires the holding of elections;<br/>
<a id="pl.236.5"></a><var>236.5</var>    (10) ensures due process or equal protection;<br/>
<a id="pl.236.6"></a><var>236.6</var>    (11) provides for the notification and conduct of public meetings;<br/>
<a id="pl.236.7"></a><var>236.7</var>    (12) establishes the procedures for administrative and judicial review of actions <br/>
<a id="pl.236.8"></a><var>236.8</var>taken by political subdivisions;<br/>
<a id="pl.236.9"></a><var>236.9</var>    (13) protects the public from malfeasance, misfeasance, or nonfeasance by officials <br/>
<a id="pl.236.10"></a><var>236.10</var>of political subdivisions;<br/>
<a id="pl.236.11"></a><var>236.11</var>    (14) relates directly to financial administration, including the levy, assessment, <br/>
<a id="pl.236.12"></a><var>236.12</var>and collection of taxes;<br/>
<a id="pl.236.13"></a><var>236.13</var>    (15) relates directly to the preparation and submission of financial audits necessary <br/>
<a id="pl.236.14"></a><var>236.14</var>to the administration of state laws; or<br/>
<a id="pl.236.15"></a><var>236.15</var>    (16) requires uniform standards to apply to public and private institutions without <br/>
<a id="pl.236.16"></a><var>236.16</var>differentiation.<br/>
<br/>
<a id="bill.16.3.0"></a><a id="pl.236.17"></a><var>236.17</var>    Sec. 3. Minnesota Statutes 2006, section 3.989, subdivision 2, is amended to read:<br/>
<a id="pl.236.18"></a><var>236.18</var>    Subd. 2. <b>Report</b><b> Compilation of local impact notes</b><b>.</b> The commissioner of finance <br/>
<a id="pl.236.19"></a><var>236.19</var>shall prepare by September 1, 2000, and by September 1 of each even-numbered year <br/>
<a id="pl.236.20"></a><var>236.20</var>thereafter, a report compilation of the costs of local mandates established after June 30, <br/>
<a id="pl.236.21"></a><var>236.21</var>1997 key impact notes requested by the legislature during the previous biennial session <br/>
<a id="pl.236.22"></a><var>236.22</var>as provided in section 3.987. The commissioner may consult with local government <br/>
<a id="pl.236.23"></a><var>236.23</var>representatives and legislative fiscal staff to determine which local impact notes were key.<br/>
<a id="pl.236.24"></a><var>236.24</var>    The commissioner shall include the statewide total of the statement of costs of local <br/>
<a id="pl.236.25"></a><var>236.25</var>mandates after June 30, 1997, as a notation in the state biennial budget.<br/>
<br/>
<a id="bill.16.4.0"></a><a id="pl.236.26"></a><var>236.26</var>    Sec. 4. Minnesota Statutes 2006, section 3.989, subdivision 3, is amended to read:<br/>
<a id="pl.236.27"></a><var>236.27</var>    Subd. 3. <b>Certain political subdivisions; report.</b> The political subdivisions that <br/>
<a id="pl.236.28"></a><var>236.28</var>have opted to administer class B state mandates shall report to the commissioner of <br/>
<a id="pl.236.29"></a><var>236.29</var>finance by September 1, 1998, and by September 1 of each year thereafter, identifying <br/>
<a id="pl.236.30"></a><var>236.30</var>each instance when revenue for a class B state mandate has fallen below 85 percent of <br/>
<a id="pl.236.31"></a><var>236.31</var>the total cost of the program and the political subdivision intends to cease administration <br/>
<a id="pl.236.32"></a><var>236.32</var>of the program.<br/>
<a id="pl.237.1"></a><var>237.1</var>    The commissioner shall forward a copy of the report to the chairs of the appropriate <br/>
<a id="pl.237.2"></a><var>237.2</var>funding committees of the senate and the house for proposed inclusion of the shortfall as a <br/>
<a id="pl.237.3"></a><var>237.3</var>line item appropriation in the state budget for the next fiscal year.<br/>
<a id="pl.237.4"></a><var>237.4</var>    The political subdivision may exercise its option to cease administration only if the <br/>
<a id="pl.237.5"></a><var>237.5</var>legislature has failed to include the shortfall as an appropriation in the state budget for <br/>
<a id="pl.237.6"></a><var>237.6</var>the next fiscal year.<br/>
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<a id="bill.16.5.0"></a><a id="pl.237.7"></a><var>237.7</var>    Sec. 5. Minnesota Statutes 2006, section 16A.103, subdivision 2, is amended to read:<br/>
<a id="pl.237.8"></a><var>237.8</var>    Subd. 2. <b>Local revenue.</b> In February and November of each year, the commissioner <br/>
<a id="pl.237.9"></a><var>237.9</var>of revenue shall prepare and deliver to the governor and the legislature forecasts of <br/>
<a id="pl.237.10"></a><var>237.10</var>revenue to be received by school districts as a group, counties as a group, and the group of <br/>
<a id="pl.237.11"></a><var>237.11</var>cities and towns that have a population of more than 2,500. The forecasts must assume <br/>
<a id="pl.237.12"></a><var>237.12</var>the continuation of current laws, projections of valuation changes in real property, and <br/>
<a id="pl.237.13"></a><var>237.13</var>reasonable estimates of projected growth in the national and state economies and affected <br/>
<a id="pl.237.14"></a><var>237.14</var>populations. Revenue must be estimated for property taxes, state and federal aids, local <br/>
<a id="pl.237.15"></a><var>237.15</var>sales taxes, if any, and a single projection for all other revenue for each group of affected <br/>
<a id="pl.237.16"></a><var>237.16</var>local governmental units. As part of the February forecast, the commissioner of revenue <br/>
<a id="pl.237.17"></a><var>237.17</var>shall report to the governor and legislature on which groups of local government units <br/>
<a id="pl.237.18"></a><var>237.18</var>exceeded the revenue targets of the governor and legislature in the most recent biennium.<br/>
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<a id="bill.16.6.0"></a><a id="pl.237.19"></a><var>237.19</var>    Sec. 6. Minnesota Statutes 2006, section 270A.03, subdivision 2, is amended to read:<br/>
<a id="pl.237.20"></a><var>237.20</var>    Subd. 2. <b>Claimant agency.</b> "Claimant agency" means any state agency, as defined <br/>
<a id="pl.237.21"></a><var>237.21</var>by section 
         <statute_ref>14.02, subdivision 2</statute_ref>, the regents of the University of Minnesota, any district <br/>
<a id="pl.237.22"></a><var>237.22</var>court of the state, any county, any statutory or home rule charter city, including a city that <br/>
<a id="pl.237.23"></a><var>237.23</var>is  presenting a claim for a municipal hospital or a public library or a municipal ambulance <br/>
<a id="pl.237.24"></a><var>237.24</var>service, a hospital district, a private nonprofit hospital that leases its building from the <br/>
<a id="pl.237.25"></a><var>237.25</var>county or city in which it is located, any public agency responsible for child support <br/>
<a id="pl.237.26"></a><var>237.26</var>enforcement, any public agency responsible for the collection of court-ordered restitution, <br/>
<a id="pl.237.27"></a><var>237.27</var>and any public agency established by general or special law that is responsible for the <br/>
<a id="pl.237.28"></a><var>237.28</var>administration of a low-income housing program, and the Minnesota collection enterprise <br/>
<a id="pl.237.29"></a><var>237.29</var>as defined in section 
         <statute_ref>16D.02, subdivision 8</statute_ref>, for the purpose of collecting the costs imposed <br/>
<a id="pl.237.30"></a><var>237.30</var>under section 
         <statute_ref>16D.11</statute_ref>. A county may act as a claimant agency on behalf of an ambulance <br/>
<a id="pl.237.31"></a><var>237.31</var>service licensed under chapter 144E if the ambulance service's primary service area is <br/>
<a id="pl.237.32"></a><var>237.32</var>located at least in part within the county, but more than one county may not act as a <br/>
<a id="pl.237.33"></a><var>237.33</var>claimant agency for a licensed ambulance service with respect to the same debt. <br/>
<br/>
<a id="bill.16.7.0"></a><a id="pl.238.1"></a><var>238.1</var>    Sec. 7. Minnesota Statutes 2006, section 270A.10, is amended to read:<br/>
<a id="pl.238.2"></a><var>238.2</var><b>270A.10 PRIORITY OF CLAIMS.</b><br/>
<a id="pl.238.3"></a><var>238.3</var>    If two or more debts, in a total amount exceeding the debtor's refund, are submitted <br/>
<a id="pl.238.4"></a><var>238.4</var>for setoff, the priority of payment shall be as follows: First, any<br/>
<a id="pl.238.5"></a><var>238.5</var>    (1) delinquent tax obligations of the debtor which are owed to the department shall <br/>
<a id="pl.238.6"></a><var>238.6</var>be satisfied. Secondly, the refund shall be applied to;<br/>
<a id="pl.238.7"></a><var>238.7</var>    (2) debts for child support based on the order in time in which the commissioner <br/>
<a id="pl.238.8"></a><var>238.8</var>received the debts. Thirdly, the refund shall be applied to;<br/>
<a id="pl.238.9"></a><var>238.9</var>    (3) payment of restitution obligations. Fourthly, the refund shall be applied to;<br/>
<a id="pl.238.10"></a><var>238.10</var>    (4) claims brought for a hospital or an ambulance service;<br/>
<a id="pl.238.11"></a><var>238.11</var>    (5) the remaining debts based on the order in time in which the commissioner <br/>
<a id="pl.238.12"></a><var>238.12</var>received the debts.<br/>
<br/>
<a id="bill.16.8.0"></a><a id="pl.238.13"></a><var>238.13</var>    Sec. 8. Minnesota Statutes 2006, section 298.75, is amended by adding a subdivision <br/>
<a id="pl.238.14"></a><var>238.14</var>to read:<br/>
<a id="pl.238.15"></a><var>238.15</var>    Subd. 11. <b>Tax may be imposed; Otter Tail County.</b> (a) If Otter Tail County <br/>
<a id="pl.238.16"></a><var>238.16</var>does not impose a tax under this section and approves imposition of the tax under this <br/>
<a id="pl.238.17"></a><var>238.17</var>subdivision, the town of Scambler in Otter Tail County may impose the aggregate <br/>
<a id="pl.238.18"></a><var>238.18</var>materials tax under this section.<br/>
<a id="pl.238.19"></a><var>238.19</var>    (b) For purposes of exercising the powers contained in this section, the "town" is <br/>
<a id="pl.238.20"></a><var>238.20</var>deemed to be the "county."<br/>
<a id="pl.238.21"></a><var>238.21</var>    (c) All provisions in this section apply to the town of Scambler, except that all <br/>
<a id="pl.238.22"></a><var>238.22</var>proceeds of the tax must be retained by the town and used for the purposes described in <br/>
<a id="pl.238.23"></a><var>238.23</var>subdivision 7.<br/>
<a id="pl.238.24"></a><var>238.24</var>    (d) If Otter Tail County imposes an aggregate materials tax under this section, the <br/>
<a id="pl.238.25"></a><var>238.25</var>tax imposed by the town of Scambler under this subdivision is repealed on the effective <br/>
<a id="pl.238.26"></a><var>238.26</var>date of the Otter Tail County tax.<br/>
<a id="pl.238.27"></a><var>238.27</var><b>EFFECTIVE DATE.</b>This section is effective the day after the governing body <br/>
<a id="pl.238.28"></a><var>238.28</var>of the town of Scambler and its chief clerical officer comply with section 645.021, <br/>
<a id="pl.238.29"></a><var>238.29</var>subdivisions 2 and 3.<br/>
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<a id="bill.16.9.0"></a><a id="pl.238.30"></a><var>238.30</var>    Sec. 9. <b> REPEALER.</b><br/>
<a id="pl.238.31"></a><var>238.31</var>Minnesota Statutes 2006, section 16A.1522, is repealed.<br/>