HF2323

THIRD ENGROSSMENT

Omnibus tax bill.

Article 1: Individual income, corporate franchise, and estate and gift taxes provision provided.

Sec. 1: Internal Revenue Code definition modified.

Sec. 2: Withholding tax, withholding from payments to out-of-state contractors, and withholding by partnerships and small business corporations liability provision language added.

Sec. 3: Domestic corporation definition modified.

Sec. 4: Tax haven definition provided.

Sec. 5: Net income definition modified.

Sec. 6: Federal taxable income additions provision language modified.

Sec. 7: Federal taxable income subtractions provision language modified.

Sec. 8: Federal taxable income additions for corporations provision language modified.

Sec. 9: Modifications decreasing federal taxable income for corporations provision language modified.

Sec. 10: Taxable income definition modified.

Sec. 11: Internal Revenue Code definition modified.

Sec. 12: Minnesota developmental subsidies and definition provided.

Sec. 13: Qualified obligations provision provided.

Sec. 14: Nonresident individual return filing provision language modified.

Sec. 15: Taxable net income schedule of rates for individuals, estates, and trusts language modified.

Sec. 16: Inflation adjustment of brackets provision language modified.

Sec. 17: Mortgage interest credit authorized.

Sec. 18: Charitable contributions credit authorized.

Sec. 19: Allowed credit provision language modified.

Sec. 20: Taxpayer allowed credit provision language modified.

Sec. 21: Credit prohibition from exceeding the liability for tax provision language modified.

Sec. 22: Partnerships and S corporations provision language modified.

Sec. 23: Minnesota Child Credit established.

Sec. 24: Definitions modified.

Sec. 25: Alternative minimum taxable income definition modified.

Sec. 26: Franchise tax imposition provision language modified.

Sec. 27: Minnesota sales or receipts, property, and payrolls definitions modified.

Sec. 28: Inflation adjustment authorized.

Sec. 29: Income not derived from conduct of a trade or business provision language modified.

Sec. 30: Unitary business principle provision language modified.

Sec. 31: Apportionment formula of general application modified.

Sec. 32: Apportionment formula for financial institutions modified.

Sec. 33: Internal Revenue Code definition modified.

Sec. 34: Scope provided.

Sec. 35: Imposed tax amount provision language modified.

Sec. 36: Definitions provided; taxable gifts definition included.

Sec. 37: Gift tax imposed, lifetime credit authorized, and out-of-state gifts provision provided.

Sec. 38: Gift tax returns authorized.

Sec. 39: Gift tax returns filing requirements provided.

Sec. 40: Appraisal of property authorized upon demand, declaration by
donor required.

Sec. 41: Administrative provisions provided.

Sec. 42: Credit authorized against the estate tax.

Sec. 43: Job opportunity building zone tax incentives provision language modified.

Sec. 44: Prohibition against amendments to business subsidy agreement provision language added.

Sec. 45: Revisor's instruction; Internal cross-references corrected.

Sec. 46: Repealer.

Article 2: County revenue reform provision provided.

Sec . 1: Local governmental unit definition modified.

Sec. 2: Levy limit base provision language modified.

Sec. 3: Adjusted levy limit base provision language modified.

Sec. 4: Property tax levy limit provision for a local governmental unit
language modified.

Sec. 5: Political subdivision tax authorization and scope provision language modified.

Sec. 6: Counties authorized to impose general local sales tax.

Sec. 7: Optional tax effect on existing local sales taxes provided, and satisfaction of preexisting obligations required.

Sec. 8: County program aid provision provided.

Sec. 9: Appropriation for reimbursement payments provision language modified.

Sec. 10: Repealer.

Article 3: Property tax reform, accountability, value, and efficiency provisions provided.

Sec. 1: The Council on Local Results and Innovation established.

Sec. 2: Reports of local performance measure required, and benefits of
standard measures program participation provided.

Sec. 3: Regional library basic system support grants provision language modified.

Sec. 4: Support grant limitations provision language modified.

Sec. 5: Children's mental health collaborative responsibilities provision language modified.

Sec. 6: County confinement facilities requirement language modified.

Sec. 7: Medical assistance benefits eligibility under Code of Federal Regulations provision language modified.

Sec. 8: Equitable funding of health and human services reform provided.

Sec. 9: Property tax system benchmarks and critical indicators provided.

Sec. 10: County reimbursement reductions provided.

Sec. 11: Temporary suspension of new or increased maintenance of effort and matching fund requirements provided.

Sec. 12: Repealer.

Article 4: Local government flexibility and mandate reduction provisions provided.

Sec. 1: Objections to rules by the commission, Legislative Commission on Mandate Reform, or a committee provision language modified.

Sec. 2: Public hearings by state agencies provision language modified.

Sec. 3: The Legislative Commission on Mandate Reform established.

Sec. 4: Legislative Commission on Mandate Reform review of mandates and recommendations required.

Sec. 5: Legislative Commission on Mandate Reform recommended grants authorized.

Sec. 6: Expiration.

Sec. 7: Effective date provided for rules requiring local implementation.

Sec. 8: Best value contracting system for construction establishment and purpose provision language modified.

Sec. 9: Counties authorized to prohibit further burials in abandoned cemeteries that it has accepted responsibility for.

Sec. 10: Fence viewer compensation requirement language modified.

Sec. 11: Public burial ground determined town property after ten years of
public use provision language modified.

Sec. 12: Council plans and specifications and advertisement for bids
provision language modified.

Sec. 13: Improvements contracts and day labor provision language modified.

Sec. 14: Letting of contracts and performance bonds provision language modified.

Sec. 15: Fee authorization provision for persons booked for confinement at a county or regional jail language modified.

Sec. 16: First meeting requirement provided for the Legislative Commission on Mandate Reform.

Article 5: Truth in taxation provisions provided.

Sec. 1: Board publication requirements of revenue and expenditure budgets language modified.

Sec. 2: Taxing authority proposed budget requirement language modified.

Sec. 3: Overlapping taxing authority jurisdictions provision language modified.

Sec. 4: Taxing authorities in the process of negotiating an agreement for sharing, merging, or consolidating services provision language modified.

Sec. 5: Notice of proposed property taxes requirement language modified.

Sec. 6: Adoption of budget and property tax levy procedure language modified.

Sec. 7: Certification of levy provision language modified.

Sec. 8: County auditor report requirement language modified.

Sec. 9: Determination of county tax rate provision language modified.

Sec. 10: Joint property tax advisory committee duties provision language modified.

Sec. 11: Tax levy for repayment authorization provision language modified.

Sec. 12: Corporations created by political subdivision compliance with other laws provision language modified.

Sec. 13: Metropolitan council budget requirements language modified.

Sec. 14: Repealer.

Article 6: Property tax provisions provided.

Sec. 1: Agricultural preserve eligibility provision language modified to include conditions for termination of eligibility.

Sec. 2: Institutions of public charity federal income taxation exemption provision language modified.

Sec. 3: Nursing home or facility federal income taxation exemption provided.

Sec. 4: Railroad wye connections exemption provided.

Sec. 5: Electric generation facility exemption provided.

Sec. 6: New generating plants built on personal property exemption provided.

Sec. 7: Distribution of revenues provision language modified.

Sec. 8: Cross-compliance with agricultural chemical and water laws provision provided.

Sec. 9: Preservation of riparian buffers provided.

Sec. 10: Applicability provision language modified.

Sec. 11: Disaster and emergency area damaged property reassessments requirement language modified.

Sec. 12: Disaster-damaged homes partial valuation exclusion provided.

Sec. 13: Residential homestead general rule provision language modified.

Sec. 14: Class 4 residential real estate provision language modified.

Sec. 15: Homestead of a disabled veteran classification provision language modified.

Sec. 16: Computation provision of net property taxes language modified; bovine tuberculosis zone credit removed.

Sec. 17: Levy amount levied against commercial-industrial property and seasonal residential recreational property provision language modified.

Sec. 18: Commercial-industrial tax capacity definition modified.

Sec. 19: Contents of tax statements provision language modified.

Sec. 20: Forms publication correction provision language modified.

Sec. 21: Apportionment of proceeds to taxing districts provision language modified.

Sec. 22: Senior citizens' property tax deferral program qualification provision language modified.

Sec. 23: Excess-income certification by taxpayer provision language modified.

Sec. 24: Resumption of tax deferral program participation provision language modified.

Sec. 25: Determination of qualifying homeowner's annual maximum property tax amount provision language modified.

Sec. 26: Deadline for establishment of a new special service district extended to 2013.

Sec. 27: Deadline for establishment of a new housing improvement area extended to 2012.

Sec. 28: Municipality provision language modified.

Sec. 29: Council of municipality authorized to make certain improvements provision language modified.

Sec. 30: Municipal street improvement districts establishment authorized.

Sec. 31: Termination of program eligibility provision provided.

Sec. 32: Owners of certified long-term agricultural land applications for an agricultural preserve provision language modified.

Sec. 33: Emergency special service district limitation provision language modified.

Sec. 34: Effective date.

Sec. 35: Effective date.

Sec. 36: Commissioner of revenue guidance purpose provided.

Sec. 37: Administrative auditor report required on the feasibility of basing
fiscal year disparities calculations on current year tax rates.

Sec. 38: Minneapolis Convention Center property tax exemption provided.

Sec. 39: Repealer.

Article 7: Aids and credits provided.

Sec. 1: Residential homestead market value credit provision language modified.

Sec. 2: Reimbursement payments for local taxing jurisdictions provision language modified.

Sec. 3: Homeowners income payment provision language modified.

Sec. 4: City aid base provision language modified.

Sec. 5: City aid distribution provision language modified.

Sec. 6: 2010 city aid reduction provided.

Sec. 7: City and county aid reductions provided.

Sec. 8: Cities aid provision language modified.

Sec. 9: Fiscal stabilization account appropriation provided.

Sec. 10: Repealer.

Article 8: Seasonal recreational property tax deferral program provided.

Sec. 1: Act citation provided as the "seasonal recreational property tax deferral program."

Sec. 2: Terms and language provided.

Sec. 3: Qualifications for deferral provided.

Sec. 4: Application for deferral procedure provided.

Sec. 5: Calculation of deferred property tax amount provided.

Sec. 6: Lien created.

Sec. 7: Conditions of deferral termination provided, and payment of deferred taxes required.

Sec. 8: State reimbursement payment determination provision provided.

Sec. 9: Effective date.

Article 10: Special taxes provisions provided.

Sec. 1: Liquor retailer tax imposed and increased to five percent of gross receipts from retail sales.

Sec. 2: Moist snuff definition provided.

Sec. 3: Cigarette tax rate provision language modified.

Sec. 4: Tobacco products tax rate provision language modified.

Sec. 5: Tobacco products use or storage tax provision language modified.

Sec. 6: Annual moist snuff inflation adjustment authorized.

Sec. 7: Distilled spirits and wine excise tax general rates increase provided.

Sec. 8: Fermented malt beverages excise tax rate increase provided.

Sec. 9: Floor stock cigarette tax imposed.

Sec. 10: Adjustment of cigarette sales tax provided.

Article 10: Sales and use tax provisions provided.

Sec. 1: Snowmobile purchaser's certificate and proof of sales tax payment registration requirement language modified.

Sec. 2: All-terrain vehicle purchaser's certificate and proof of sales tax payment registration requirement language modified.

Sec. 3: Watercraft purchaser's certificate and proof of sales tax payment registration requirement language modified.

Sec. 4: Sales and use taxes notification requirements provided.

Sec. 5: Return requirement language modified.

Sec. 6: Sales and use tax provision language modified; Persons allowed to remit payments by mail when religious beliefs prohibit electronic payment.

Sec. 7: Sale and purchase definitions modified to include digital products.

Sec. 8: Retail sale definition modified to include digital products.

Sec. 9: Storage definition modified to include digital products.

Sec. 10: Use definition modified to include digital products.

Sec. 11: Tangible personal property definition modified to include digital
products.

Sec. 12: Lease or rental definition modified to include digital products.

Sec. 13: Delivered electronically definition modified to include online computer software delivery.

Sec. 14: Normal course of business definition modified to include digital products.

Sec. 15: Bundled transaction definition modified to include digital products.

Sec. 16: Digital audio visual work definition provided.

Sec. 17: Digital audio work definition provided.

Sec. 18: Digital book definition provided.

Sec. 19: Digital code definition provided.

Sec. 20: Specified digital products definition provided.

Sec. 21: Transferred electronically definition provided.

Sec. 22: Other digital products definition provided.

Sec. 23: Constitutionally required sales tax increase imposed.

Sec. 24: Use tax on tangible personal property and specified digital products
provision language modified.

Sec. 25: Fee imposed on leases or rentals of vehicles provision language
modified to exempt nonprofit corporations.

Sec. 26: Definitions modified.

Sec. 27: Solicitor definition provided.

Sec. 28: Residential heating fuels exemption language modified.

Sec. 29: Occasional sales provision language modified.

Sec. 30: Motor vehicle lease sales tax revenue provision language modified.

Sec. 31: Commissioner's discretion provision language modified.

Sec. 32: Deposit of revenues provision language modified.

Sec. 33: Compensating use tax provision language extended to digital
products.

Sec. 34: Excise tax rate on the purchase price of a motor vehicle purchased or acquired outside of Minnesota language modified.

Sec. 35: Property tax revenue use provision language modified.

Sec. 36: Minneapolis downtown and neighborhood projects funding through
excess revenue authorized.

Sec. 37: Downtown taxing area provision language modified.

Sec. 38: Revenue use provision language modified.

Sec. 39: Revenue use provision language modified.

Sec. 40: Unexpended funds and interest apportionment provided.

Sec. 41: Little Falls; Food sales tax provision expanded to include a tax on the sale of alcoholic beverages.

Sec. 42: St. Paul sales tax revenue dedicated to neighborhood investments provision language added.

Sec. 43: Rochester lodging tax provision language modified.

Sec. 44: Tax revenue use provision for transportation projects included in the 2004 U.S. Highway 14-Owatonna Beltline Study provision language modified.

Sec. 45: Authorized tax proceeds use for the operation and maintenance of the Riverfront 2000 provision language modified.

Sec. 46: Department of Revenue sales and local lodging taxes collection authorized.

Sec. 47: Rochester food and beverage tax authorized for restaurants and places of refreshment.

Sec. 48: Repealer.

Article 11: Local development provisions provided.

Sec. 1: Tourism facility definition modified.

Sec. 2: Tax increment financing plan contents requirements language modified.

Sec. 3: Annual financial reporting requirement for tax increment financing districts language modified.

Sec. 4: Administrative expenses limitation provision language modified.

Sec. 5: Increments use authorized to offset state aid reductions.

Sec. 6: Required action provision language added.

Sec. 7: Tax increment financing district expenditures outside of district
provision language modified.

Sec. 8: Five-year rule language added.

Sec. 9: Interfund loans authorization provision language modified.

Sec. 10: Authority definition modified.

Sec. 11: Housing replacement projects provision language modified;
Brooklyn Park included.

Sec. 12: Oakdale; Original tax capacity provision language modified.

Sec. 13: South St. Paul; Housing and redevelopment authority authorized to
establish a redevelopment tax increment financing district.

Sec. 14: Minnetonka; Economic authority authorized to extend the maximum duration of the Glenhaven Tax Increment Financing District.

Sec. 15: Arden Hills; Authorized to establish a redevelopment tax increment financing district.

Sec. 16: St. Paul; Authority provided to exercise special law authority.

Sec. 17: Sauk Rapids; Tax increment financing district authorized.

Sec. 18: Duluth; Seaway Port Authority of Duluth authorized to adopt a tax
increment financing plan, special rules provided.

Sec. 19: Mankato; Authorized to expend increments generated from the South Riverfront tax increment financing district for improvements under
the Sibley Parkway Plan.

Sec. 20: Faribault; Authorized to extend the duration of a job opportunity building zone.

Article 12: Minerals provisions provided.

Sec. 1: Nonferrous minerals assistance areas provided.

Sec. 2: Tax proceeds allocation within nonferrous minerals assistance areas
provision language modified.

Sec. 3: Tax proceeds allocation outside nonferrous minerals assistance areas provision language modified.

Sec. 4: Segregation of funds provided.

Sec. 5: Taconite economic development fund provision language modified.

Sec. 6: Imposed iron ore concentrates tax rate provision language modified.

Sec. 7: Taxable ton of merchantable iron ore concentrate allocated to the
mining city or town where it was quarried or produced, provision language
modified.

Sec. 8: Taconite environmental fund requirement provided.

Sec. 9: Proceeds remainder allocation after distribution and payment
provision language modified.

Article 13: Miscellaneous provisions provided.

Sec. 1: Bovine tuberculosis testing grants authorized for corporate owners of cattle.

Sec. 2: Bovine tuberculosis split state grants authorized for owners of cattle.

Sec. 3: Tax information sample data coordinating committee duration provided.

Sec. 4: Tax preparation services provider scope provision language modified.

Sec. 5: Procedure for liability assessment and claims for refunds provision language modified.

Sec. 6: Recertification due to unallotment authorized.

Sec. 7: Special levies definition and provision language modified.

Sec. 8: Adjusted levy limit base provision language modified.

Sec. 9: Tax payment requirements and receipts provision language modified.

Sec. 10: Net debt definition modified.

Sec. 11: Municipality bonds purpose provision language modified.

Sec. 12: Electors approval and exceptions provision language modified.

Sec. 13: Authorization and sale of emergency certificates of indebtedness
authorized.

Sec. 14: Budget reserve transfer provided.

Sec. 15: Appropriations provided; Bovine tuberculosis grants and basic sliding fee child care included.

ERS, 5/5/09