Relating to taxation

ARTICLE 1 - AIDS TO LOCAL GOVERNMENTS

Increasing the city aid base for the city of Mahnomen; modifying the city aid formula; modifying city aid distribution calculations; modifying Mahnomen county, city and school district property tax reimbursements, tax base adjustments and tax base adjustments for calculation of school district aids and levies; requiring the commissioner of revenue to compute the adjusted net tax capacity and referendum market value for tax base adjustments for the calculation of school district and county, city and town aids and levies for utility property

ARTICLE 2 - PROPERTY TAXES

Allowing towns incorporating into cities to continue to receive payment in lieu of tax allocations for public hunting areas; requiring the assessment/sales ratio study to take into account the changes in the use of the property; authorizing utilities to recover the cost of higher property taxes due to class rate changes through a rate adjustment; exempting modular homes used as models by dealers from the property tax; exempting property used to operate state or federally approved apprenticeship training facilities from the property tax; exempting monosloped roofs for feedlots and manure storage areas from the property tax; requiring the certificate of real estate value to include any proposed changes in the use of the property; requiring annual registration of certain relative households; increasing the value threshold for taxability of certain structures; extending the application of 4d property classification for low income rental property; increasing the market value included in tier I homestead resorts; modifying class 1c provisions; increasing the property tax class rates on certain utility property; modifying class 4c property classification provisions; expanding residential real estate property classification to certain nonprofit community service oriented organizations; providing for a valuation exclusion for homesteads of certain disabled military veterans; providing for administration and declaration of class 1b homestead property, specifying filing requirements; allowing counties to hold a joint truth in taxation hearing with the governing bodies of the taxing authorities within the county; adding airport authorities to the list of special taxing districts; modifying proposed property tax notice content requirements; itemizing specific information required for petitioner contests of the valuation of income producing property; increasing the maximum value for delinquent taxes on a commercial property to be compressed into a confession of judgment; permitting payment of a partial year of delinquent taxes to be paid in inverse order; increasing the minimum sustainable forest incentive payment; authorizing a city, county, town or an Indian nation to create an airport authority; granting airport authorities the power of municipalities; specifying the process for establishing an authority; vesting the powers of an airport authority in the airport authority commissioners, providing for appointment of commissioners; providing for compensation, meetings and officers; providing for the processes to increase and decrease the size of the authority and to dissolve the authority; authorizing an airport authority to annually certify a tax levy; authorizing deferment of special assessments for certain members of the armed forces; modifying provisions relating to funding for the construction, operation and maintenance of streets and street lighting within the city of Minneapolis; modifying the levy authority for the Cook Orr hospital district; modifying the levy authority of the Cook county hospital district; authorizing the cities of Coleraine, Bovey, Taconite, Marble and Calumet and the towns of Iron Range, Lawrence, Greenway and Trout Lake to establish the Lakeview cemetery association; repealing provisions relating to the city of Minneapolis and the Lakeview cemetery association

ARTICLE 3 - INDIVIDUAL INCOME TAXES

Requiring expanded tax information reporting to the commissioner of revenue under certain conditions; providing an income tax subtraction for the amount of national service education awards received from the national service trust for service in an approved AmeriCorps national service program; modifying the income tax credit for military service for deceased individuals; prohibiting businesses from deducting fines, penalties and fess paid to or at the discretion of a governmental unit; modifying provisions relating to compensation received while a nonresident; requiring withholding on certain contractor payments; requiring the commissioner of revenue to conduct a random sample of withholdings and returns and report to the legislature by a certain date

ARTICLE 4 - FEDERAL UPDATE

Conforming to various federal tax changes for individual income, corporate franchise, estate tax and property tax refunds

ARTICLE 5 - SALES AND USE TAXES

Modifying sourcing rules for modular and manufactured homes; prohibiting political subdivisions from advertising, promoting, expending funds or holding a referendum to support imposition of a local option sales tax; authorizing the city of Duluth to increase the rate of tax on the sales of food and beverages; authorizing the use of proceeds of the tax for a new arena at the Duluth entertainment and convention center (DECC); authorizing Cook county to extend the local sales tax upon voter approval at a special election held prior to a certain date, requiring use of sales tax for county community center and recreation area and Grand Marais pool and public library construction and improvements, specifying a new taxing authority expiration and expenditure limitation; authorizing county bond issuance without election, specifying bond limit and debt limitation and tax levy computation exclusion for bonds; authorizing and providing for the city of Proctor to impose by ordinance an additional sales and use tax to be used for construction of and improvements to city streets, public utilities, sidewalks, bikeways, trails and parks and recreation and increasing the bonding authority of the city for the projects; authorizing the city of Bemidji to extend the imposition of a sales and use tax authority to finance certain authorized projects and to pay costs for the construction of a regional event center; modifying the bond issuance and termination of tax provisions; requiring approval by the city voters; authorizing and providing for the city of Clearwater to by ordinance and with voter approval impose a sales and use tax and a sales tax on motor vehicles and to issue state bonds to pay for costs of acquisition, construction, improvement and development of regional parks, bicycle trails, park land, pedestrian walkways, open space and land and buildings for a community and recreation center; providing for termination of the taxes; authorizing and providing for the city of North Mankato to by ordinance and with voter approval impose a sales and use tax
and to issue bonds to pay all or part of the capital costs of the city share of the marked trunk highway #14 and county state aid highway #41 interchange project, development of regional parks and hiking and biking trails, expansion of the North Mankato Taylor library, redevelopment of the central business district and lake improvement projects; providing for termination of the taxes; authorizing and providing for the city of Winona upon voter approval to impose a sales and use tax to pay for construction of a street connection from the city of Winona to highways 61 and 43; authorizing the issuance of bonds; providing for termination of the taxes

ARTICLE 6 - JUNE ACCELERATED TAX PAYMENTS

Modifying the percentage of the estimated June tax liability required to be paid before June 30

ARTICLE 7 - SPECIAL TAXES

Authorizing the commissioner of revenue to determine the value of property subject to the estate tax independently of the value for federal purposes; modifying the amount of gasoline usage attributable to all terrain vehicle operation; modifying certain duties of the commissioner of revenue relating to the disposition of cigarette packages or tobacco products after judgment of forfeiture; exempting from the insurance premiums tax certain life insurance premiums paid by state employees group insurance program (SEGIP) members; extending the expiration date for the authority of Hennepin and Ramsey counties to impose mortgage registry and deed taxes; extending the Ramsey county
deed and mortgage tax; authorizing St. Louis county to impose a deed and mortgage tax, requiring proceeds to be deposited in the environmental response fund; creating an environmental response fund for acquisition of polluted or contaminated lands and the paying of certain costs; requiring the county to seek matching funds; authorizing the county to issue bonds and resell land at fair market value; authorizing Dakota county to impose a deed and mortgage tax, requiring proceeds to be deposited in the environmental response fund; creating an environmental response fund for acquisition of polluted or contaminated lands and the paying of certain costs; requiring the county to seek matching funds; authorizing the county to issue bonds and resell land at fair market value;
authorizing Anoka county to impose a deed and mortgage tax, sunset provision; creating the Anoka county environmental response fund, specifying uses for the fund; providing for matching funds, bonding and land sales; requiring the commissioner of transportation (DOT) to provide certain assistance; extending the temporary petrofund fee exemption for Minnesota commercial airlines

ARTICLE 8 - ECONOMIC DEVELOPMENT

Providing for additional border city enterprise and development zone allocations by the commissioner of employment and economic development (DEED) to western border cities for certain tax reductions; making certain technical and minor policy modifications to tax increment financing (TIF) provisions; modifying TIF plans to allow the authority to specify the first year it elects to receive the increment; expanding the permitted uses for TIF districts in bioscience zones; extending the duration limit for certain job opportunity building zones (JOBZ) under certain conditions; requiring and providing for JOBZ notification and approval of relocation conditions; authorizing the state auditor to request from the commissioner of revenue tax return information of JOBZ recipient taxpayers; authorizing the city of Brooklyn Center to expand the permitted use of a redevelopment tax increment financing (TIF) district to include environmental remediation and housing construction; providing for authority of the successor to the Minneapolis community development agency relating to housing replacement projects; increasing the number of city parcel designations for housing replacement districts; designating a certain amount of money from a prior appropriation to the commissioner of employment and economic development (DEED) to be used by the commissioner for a study to determine the economic viability of business plans for international economic development zones; authorizing the city of Burnsville to create a certain TIF district subject to certain special rules and limits; deeming Eyota as a small city for TIF purposes upon local approval; authorizing and providing for the city of Fridley to create a TIF district subject to certain special rules; authorizing the city of New Brighton to expend increments generated from a certain tax increment financing district to facilitate certain activities outside the district; repealing the definition of qualified housing district and the distribution of certain Burnsville tax increments

ARTICLE 9 - PUBLIC FINANCE

Providing terms and conditions relating to the issuance of obligations and the financing of public improvements and services; modifying certain collateral amount requirements for the deposit of local public funds; extending the time for repayment of certain school district certificates or notes for equipment purchases; extending the time for certain publications of a public notice; modifying the definition of subordinate service district and defining special services for towns; modifying certain requirements for the establishment of a subordinate service districts by town boards and specifying certain duties of town boards, authorizing the issuance of bonds and certain covenants to secure obligations for subordinate service districts; modifying county subordinate service districts provisions, authorizing the issuance of bonds and certain covenants to secure obligations for subordinate service districts; extending the time for repayment of Hennepin county equipment acquisition capital notes, modifying the definition of equipment; clarifying the authority of the Hennepin county housing and redevelopment authority within a municipality; eliminating the expiration date for a home rule charter city and city councils to issue capital notes for software; modifying the definition of city for municipal gas distribution purposes; authorizing political subdivisions with an actuarial liability to pay postemployment benefits to create a trust to pay benefits; providing for a trust administrator; specifying account maintenance and investment provisions; providing for a limit on deposit, withdrawal of funds and termination of account and the status of the irrevocable fund; authorizing counties and cities to borrow and issue bonds in anticipation of receiving federal transportation grants; increasing the net debt limit of a municipality; modifying certain conditions for street reconstruction financing obligations; providing for postemployment trust validation; authorizing the town of Crane Lake in St. Louis county to issue certificates of indebtedness for property acquisition related to land exchange with the United States forest service, requiring a tax levy to pay the principal and interest; authorizing the city of Winsted to issue bonds to finance the acquisition and betterment of a facility consisting of a city hall, community center and police station for park improvements including trails and an amphitheater, related public improvements and landscaping for the improvements

ARTICLE 10 - DEPARTMENT INCOME AND FRANCHISE TAXES

Modifying the determination of debt under the revenue recapture act; requiring birth dates to be included in income tax returns; modifying withholding statement requirements by electronic means provisions; clarifying regulated investment companies requirement to file reports with the commissioner of revenue; prescribing penalties for partnership of S corporation filing with an incorrect tax identification number; clarifying penalties for excessive property tax refunds; requiring tax preparers identification numbers; clarifying a work opportunity credit provision; modifying the bovine testing credit; modifying the inflation adjustment for the dependent care credit and working family credit; modifying the inflation adjustment for the alternative minimum tax on preference items; modifying the definition of dependent for property tax refund purposes; modifying the determination of estate tax; providing for pollution control facilities amortization transition

ARTICLE 11 - DEPARTMENT SALES AND USE TAXES

Modifying provisions relating to bad debt loss; providing for the computation of interest for border city zone refunds; clarifying provisions relating to the penalty for failure to properly complete sales and use tax returns; prescribing a penalty for failure to report liquor sales; including the furnishing of telecommunication services by a hotel, rooming house, resort, campground or trailer camp under the definition of sale; including pest control services in the definition of sale; including ring tones in the definition of sale and clarifying the definition of telecommunication services to include air to ground radio telephone services, mobile telecommunication service, postpaid calling service, prepaid wireless calling service and private communication services; providing for bundled transactions as a retail sale, exception; clarifying the definition of delivery charges relating to sales price; providing for sales price to include consideration received by the seller from third parties under certain conditions; eliminating prepaid calling cards from the definition of tangible personal property; clarifying the definition of telecommunication services; defining bundled transaction, ancillary services, conference bridging service, detailed telecommunications billing service, directory assistance,
vertical service, voice mail service, ring tone and fur clothing for sales tax
purposes; exempting kidney dialysis equipment from the sales tax; clarifying the imposition of tax on the use of personal tangible property for bundled transactions; clarifying procedures for seller burden of proof liability for nontaxable retail sales; clarifying the definition of prepaid calling service; defining prepaid wireless calling service; providing for the sale on ancillary service to be sourced to the customer place of primary use; including breast pumps in the definition of baby products for sales tax exemption purposes; clarifying the business sales tax exemption for advertising and packing materials and telecommunications, cable television and direct satellite equipment; modifying exemption requirements for materials consumed in agricultural production; authorizing an entity containing both a hospital and nonprofit unit to claim sales tax exemption under certain conditions; exempting private communication service for the state lottery from the sales tax; modifying provisions relating to tax exempt certificates; requiring liquor sellers to file an annual informational report annually by a certain date; clarifying the definition of sales price for interstate motor carriers as retailers; clarifying the sales tax on motor vehicle exemption on vehicles purchased by dealers or lessors; requiring furriers to file annual tax returns; repealing provisions relating to special fur clothing tax, prepaid telephone cars, multiple points of use and property brought into the state by nonresidents

ARTICLE 12 - DEPARTMENT PROPERTY TAXES

Modifying provisions relating to the airline flight property tax; modifying the
definition of flight property to include computers and software; modifying the assessment of flight property; modifying airline company report requirements; clarifying airflight property tax lien provisions; imposing a penalty for failure of airline company to file annual report by the required date; granting additional powers to the commissioner of revenue; modifying the determination of tax capacity for flight property; modifying appeal procedures; modifying provisions relating to the state board of assessors, modifying fees and rule provisions; authorizing the commissioner of revenue to abate airline company report filing penalties under certain conditions; requiring a business to notify the county assessor in writing of eligibility for JOBZ property tax exemption; modifying certificate of value filing requirements for married persons not an owner of record; permitting cities and townships a certain period of time from the date of incorporation to employ a licensed assessor; requiring county or local assessing districts to assume the cost of training assessors; modifying certain agricultural homestead property tax provisions; modifying certain property tax classification provisions; modifying disparity reduction credit provisions; modifying certain provisions relating to express, stage and transportation companies and companies supplying electric power; modifying certain provisions relating to the board of appeal and equalization; requiring the commissioner of revenue to develop a handbook by a certain date detailing procedures, responsibilities and requirements for county board of appeal and
equalization; authorizing notice of proposed property taxes to be sent in
electronic form or by electronic mail (e-mail) upon written request of the taxpayer; requiring the commissioner of revenue to annually prescribe the specific form and format of the advertisement for proposed property tax notice requirements; modifying certain special taxing districts provisions; authorizing counties to send tax statements by electronic means upon written request of the real property owner; modifying procedures for partial payments of delinquent taxes; modifying qualifying homesteads under the senior citizens property tax deferral program; modifying certain provisions under the sustainable resource management incentive program, providing for appeals; repealing certain provisions relating to examinations and investigations and the board of assessors

ARTICLE 13 - DEPARTMENT SPECIAL TAXES

Modifying joint underwriting associations deficit assessments; clarifying a premium tax provision under reciprocals or interinsurance contract exchange provisions; clarifying a provision relating to mortgage registry and deed tax exemptions; setting the deed tax for a conveyance of tax-forfeited lands to a governmental subdivision for authorized public uses or for redevelopment purposes; clarifying certain gross revenue and gross receipts taxes provisions relating to pharmacies; reducing the threshold for nonapplicability of tobacco products use tax to individuals; requiring and providing for consumer use tax on cigarettes under certain conditions; modifying the exemption provisions for the surcharge on fire safety premiums; modifying the joint underwriting association offset provision, clarifying the estimated tax provision for insurance taxes

ARTICLE 14 - DEPARTMENT MISCELLANEOUS

Requiring referring agencies to refer debts electronically to the commissioner of revenue for collection; modifying computation of debt; prohibiting tax refunds or other payments payable by the commissioner of revenue to a taxpayer from being assignable, subject to execution, levy, attachment, garnishment, lien foreclosure or other legal process except as provided by law; expanding the requirement for the commissioner to publish lists of convicted tax preparers to include tax preparers assessed penalties exceeding a certain amount; providing for a notice of lien filed with the office of secretary of state to be transcribed to any county for a certain period of time; modifying provisions relating to the state reimbursement for volunteer firefighters retirement supplemental benefit payments

ARTICLE 15 - MISCELLANEOUS

Modifying commissioner of finance impact notes provisions; modifying
carryforward provisions; authorizing the commissioner of revenue to disclose to the commissioner of finance returns or return information necessary in order to prepare a revenue forecast; requiring expenditure estimates to include an allowance for inflation; eliminating a reporting requirement for the commissioner of revenue relating to local government units exceeding established revenue targets; regulating and increasing the state budget reserve; modifying priorities for additional revenues in general fund forecasts and transferring a certain amount to the budget reserve account; creating a tax volatility reduction account; removing the rebate for registration filing fees above the statutory cap; modifying the definition of claimant agency under the revenue recapture act to include cities for collections purposes; prioritizing claims brought by hospital or ambulance service; requiring the commissioner of revenue to maintain a toll free telephone access service for taxpayer assistance for calls within the state; requiring the commissioner of revenue to complete the process of making grants to nonprofit organizations to provide taxpayers assistance services by a certain date; establishing a runway safety and airport zoning advisory task force to study and make recommendations regarding best practices for safety implications of airport zoning at the Minneapolis-St. Paul international airport and other airports operated by the metropolitan airports commission (MAC), specifying membership; requiring a report to the legislature by a certain date; providing for expenses; sunset provision; appropriating money to the legislative coordinating commission (LCC) for administrative expenses and
other costs; requiring the commissioner of revenue to maintain certain data for the legislature; requiring the commissioner of finance to designate any positive general fund balance and an unrestricted balance; appropriating money to the commissioner of revenue for the fiscal disparities study, 1099 reporting requirements, sales tax report, data update and to the commissioner of employment and economic development (DEED) for a grant to the city of Austin to assist in the payment of costs related to the construction of a bioscience research facility; appropriating money to the commissioner of employment and economic development (DEED) for a grant to the city of St. Paul to pay, redeem or defease the debt service costs incurred for the River Centre campus; repealing certain rebate requirements
(ra)