1.1 	A bill for an act
1.2 	relating to taxation; making policy, technical, administrative, and clarifying 
1.3 	changes to income, withholding, estate, property, sales and use, mortgage 
1.4 	registry, insurance, minerals, gasoline, lodging, and other various taxes and 
1.5 	tax-related provisions; making changes to provisions related to certain aids and 
1.6 	delinquent tax liabilities; providing for inclusion of property in a tax increment 
1.7 	financing district in the city of Sauk Rapids; providing a property tax exemption 
1.8 	for certain fairgrounds property in St. Louis County; authorizing issuance of 
1.9 	debt by Anoka County;amending Minnesota Statutes 2010, sections 69.031, 
1.10 	subdivision 1; 270.87; 270A.03, subdivisions 2, 7; 270A.07, subdivision 1; 
1.11 	270C.30; 270C.32, subdivision 3; 270C.34, subdivision 1; 270C.64; 270C.711; 
1.12 	272.02, by adding a subdivision; 272.029, by adding a subdivision; 273.1231, 
1.13 	subdivision 4; 273.124, subdivisions 1, 8, 14; 273.13, subdivision 23; 273.33, 
1.14 	subdivision 2; 273.37, subdivision 2; 273.3711; 274.175; 278.05, subdivision 
1.15 	6; 282.01, subdivisions 1a, 1c, 1d; 282.014; 282.12; 287.05, subdivision 2; 
1.16 	289A.08, subdivisions 1, 7; 289A.12, by adding a subdivision; 289A.18, 
1.17 	subdivision 3; 289A.25, subdivisions 1, 6, by adding a subdivision; 289A.26, 
1.18 	subdivision 1; 289A.35; 289A.38, subdivision 5; 289A.60, subdivision 31; 
1.19 	290.01, subdivisions 19a, 19b; 290.06, subdivision 2c; 290.091, subdivision 
1.20 	2; 290.0922, subdivisions 2, 3; 290.095, subdivision 11; 290.92, subdivision 
1.21 	26; 291.03, subdivision 1b; 296A.083, by adding a subdivision; 296A.18, 
1.22 	subdivision 7, by adding a subdivision; 297A.61, subdivision 3; 297A.62, by 
1.23 	adding a subdivision; 297A.63, by adding a subdivision; 297A.668, subdivision 
1.24 	7, by adding a subdivision; 297A.71, subdivision 23; 297A.89, subdivision 2; 
1.25 	297B.08; 297I.15, by adding a subdivision; 298.225, subdivision 1; 298.28, 
1.26 	subdivision 2; 383C.16, subdivision 1; 383E.21; 469.319, subdivision 5; Laws 
1.27 	1986, chapter 462, section 31, as amended; proposing coding for new law in 
1.28 	Minnesota Statutes, chapters 270C; 383C; repealing Minnesota Statutes 2010, 
1.29 	sections 272.02, subdivision 34; 273.124, subdivision 10; 281.37; 289A.38, 
1.30 	subdivision 3; 290.06, subdivision 10; 290A.27; 296A.18, subdivision 9.
1.31 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.32 	ARTICLE 1
1.33 	DEPARTMENT POLICY: INDIVIDUAL INCOME AND WITHHOLDING TAXES

1.34 	Section 1. Minnesota Statutes 2010, section 270C.34, subdivision 1, is amended to read:
2.1 		Subdivision 1.Authority. (a) The commissioner may abate, reduce, or refund any 
2.2 	penalty or interest that is imposed by a law administered by the commissioner, or imposed 
2.3 	by section 270.0725, subdivision 1 or 2, as a result of the late payment of tax or late filing 
2.4 	of a return, or any part of an additional tax charge under section 289A.25, subdivision 2, 
2.5 	or 289A.26, subdivision 4, if the failure to timely pay the tax or failure to timely file the 
2.6 	return is due to reasonable cause, or if the taxpayer is located in a presidentially declared 
2.7 	disaster or in a presidentially declared state of emergency area or in an area declared to be 
2.8 	in a state of emergency by the governor under section 12.31.
2.9 	(b) The commissioner shall abate any part of a penalty or additional tax charge 
2.10 	under section 289A.25, subdivision 2, or 289A.26, subdivision 4, attributable to erroneous 
2.11 	advice given to the taxpayer in writing by an employee of the department acting in 
2.12 	an official capacity, if the advice:
2.13 	(1) was reasonably relied on and was in response to a specific written request of the 
2.14 	taxpayer; and
2.15 	(2) was not the result of failure by the taxpayer to provide adequate or accurate 
2.16 	information.

2.17 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
2.18 	December 31, 2010.

2.19 	Sec. 2. Minnesota Statutes 2010, section 289A.08, subdivision 1, is amended to read:
2.20 		Subdivision 1.Generally; individuals. (a) A taxpayer must file a return for each 
2.21 	taxable year the taxpayer is required to file a return under section 6012 of the Internal 
2.22 	Revenue Code, except that:
2.23 	(1) an individual who is not a Minnesota resident for any part of the year is not 
2.24 	required to file a Minnesota income tax return if the individual's gross income derived 
2.25 	from Minnesota sources as determined under sections 290.081, paragraph (a), and 290.17, 
2.26 	is less than the filing requirements for a single individual who is a full year resident of 
2.27 	Minnesota; and
2.28 	(2) an individual who is a Minnesota resident is not required to file a Minnesota 
2.29 	income tax return if the individual's gross income derived from Minnesota sources as 
2.30 	determined under section 290.17, less the amount of the individual's gross income that 
2.31 	consists of compensation paid to members of the armed forces of the United States or 
2.32 	United Nations for active duty performed outside Minnesota subtraction allowed under 
2.33 	section 290.01, subdivision 19b, clauses (11) and (14), is less than the filing requirements 
2.34 	for a single individual who is a full-year resident of Minnesota.
3.1 	(b) The decedent's final income tax return, and other income tax returns for prior 
3.2 	years where the decedent had gross income in excess of the minimum amount at which 
3.3 	an individual is required to file and did not file, must be filed by the decedent's personal 
3.4 	representative, if any. If there is no personal representative, the return or returns must 
3.5 	be filed by the transferees, as defined in section 270C.58, subdivision 3, who receive 
3.6 	property of the decedent.
3.7 	(c) The term "gross income," as it is used in this section, has the same meaning 
3.8 	given it in section 290.01, subdivision 20.

3.9 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
3.10 	December 31, 2010.

3.11 	Sec. 3. Minnesota Statutes 2010, section 289A.08, subdivision 7, is amended to read:
3.12 		Subd. 7.Composite income tax returns for nonresident partners, shareholders, 
3.13 	and beneficiaries. (a) The commissioner may allow a partnership with nonresident 
3.14 	partners to file a composite return and to pay the tax on behalf of nonresident partners who 
3.15 	have no other Minnesota source income. This composite return must include the names, 
3.16 	addresses, Social Security numbers, income allocation, and tax liability for the nonresident 
3.17 	partners electing to be covered by the composite return.
3.18 	(b) The computation of a partner's tax liability must be determined by multiplying 
3.19 	the income allocated to that partner by the highest rate used to determine the tax liability 
3.20 	for individuals under section 290.06, subdivision 2c. Nonbusiness deductions, standard 
3.21 	deductions, or personal exemptions are not allowed.
3.22 	(c) The partnership must submit a request to use this composite return filing method 
3.23 	for nonresident partners. The requesting partnership must file a composite return in the 
3.24 	form prescribed by the commissioner of revenue. The filing of a composite return is 
3.25 	considered a request to use the composite return filing method.
3.26 	(d) The electing partner must not have any Minnesota source income other than 
3.27 	the income from the partnership and other electing partnerships. If it is determined that 
3.28 	the electing partner has other Minnesota source income, the inclusion of the income 
3.29 	and tax liability for that partner under this provision will not constitute a return to 
3.30 	satisfy the requirements of subdivision 1. The tax paid for the individual as part of the 
3.31 	composite return is allowed as a payment of the tax by the individual on the date on 
3.32 	which the composite return payment was made. If the electing nonresident partner has no 
3.33 	other Minnesota source income, filing of the composite return is a return for purposes of 
3.34 	subdivision 1.
4.1 	(e) This subdivision does not negate the requirement that an individual pay estimated 
4.2 	tax if the individual's liability would exceed the requirements set forth in section 289A.25. 
4.3 	A composite estimate may, however, be filed in a manner similar to and containing the 
4.4 	information required under paragraph (a). The individual's liability to pay estimated tax 
4.5 	is, however, satisfied when the partnership pays composite estimated tax in the manner 
4.6 	prescribed in section 289A.25.
4.7 	(f) If an electing partner's share of the partnership's gross income from Minnesota 
4.8 	sources is less than the filing requirements for a nonresident under this subdivision, the tax 
4.9 	liability is zero. However, a statement showing the partner's share of gross income must 
4.10 	be included as part of the composite return.
4.11 	(g) The election provided in this subdivision is only available to a partner who has 
4.12 	no other Minnesota source income and who is either (1) a full-year nonresident individual 
4.13 	or (2) a trust or estate that does not claim a deduction under either section 651 or 661 of 
4.14 	the Internal Revenue Code.
4.15 	(h) A corporation defined in section 290.9725 and its nonresident shareholders may 
4.16 	make an election under this paragraph. The provisions covering the partnership apply to 
4.17 	the corporation and the provisions applying to the partner apply to the shareholder.
4.18 	(i) Estates and trusts distributing current income only and the nonresident individual 
4.19 	beneficiaries of the estates or trusts may make an election under this paragraph. The 
4.20 	provisions covering the partnership apply to the estate or trust. The provisions applying to 
4.21 	the partner apply to the beneficiary.
4.22 	(j) For the purposes of this subdivision, "income" means the partner's share of 
4.23 	federal adjusted gross income from the partnership modified by the additions provided 
4.24 	in section 290.01, subdivision 19a, clauses (6) to (10), and the subtractions provided in: 
4.25 	(i) section 290.01, subdivision 19b, clause (8), to the extent the amount is assignable or 
4.26 	allocable to Minnesota under section 290.17; and (ii) section 290.01, subdivision 19b, 
4.27 	clause (13). The subtraction allowed under section 290.01, subdivision 19b, clause (8), is 
4.28 	only allowed on the composite tax computation to the extent the electing partner would 
4.29 	have been allowed the subtraction.

4.30 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
4.31 	December 31, 2010.

4.32 	Sec. 4. Minnesota Statutes 2010, section 289A.12, is amended by adding a subdivision 
4.33 	to read:
4.34 		Subd. 17.Third-party payers of sick pay benefits. (a) A third-party payer of sick 
4.35 	pay benefits who withholds income tax from the sick pay of an employee as agent for the 
5.1 	employer of the employee, and who remits that withholding tax to the commissioner must 
5.2 	file an annual report on a form prescribed by the commissioner. The report must include 
5.3 	the name and tax identification number of each employer for whom the payer has made 
5.4 	sick pay payments and the name, Social Security number, amount of sick pay paid, and 
5.5 	amount of tax withheld for each employee.
5.6 	(b) The report must be filed with the commissioner on or before February 28 of the 
5.7 	year following the year in which the sick pay benefits were paid.
5.8 	(c) The report required by this subdivision does not need to be filed if the third-party 
5.9 	payer, rather than the employer, has provided to the employee the annual statement 
5.10 	required under section 289A.09, subdivision 2, that includes the sick pay benefits paid 
5.11 	and the tax withheld.

5.12 	EFFECTIVE DATE. This section is effective for benefits paid after December 
5.13 	31, 2010.

5.14 	Sec. 5. Minnesota Statutes 2010, section 289A.25, subdivision 1, is amended to read:
5.15 		Subdivision 1.Requirements to pay. An individual, trust, S corporation, or 
5.16 	partnership must, when prescribed in subdivision 3, paragraph (b), make payments of 
5.17 	estimated tax. For individuals, the term "estimated tax" means the amount the taxpayer 
5.18 	estimates is the sum of the taxes imposed by chapter 290 for the taxable year. For trusts, 
5.19 	S corporations, and partnerships, the term estimated tax means the amount the taxpayer 
5.20 	estimates is the sum of the taxes for the taxable year imposed by chapter 290 and the 
5.21 	composite income tax imposed by section 289A.08, subdivision 7. If the individual is an 
5.22 	infant or incompetent person, the payments must be made by the individual's guardian. If 
5.23 	joint payments on estimated tax are made but a joint return is not made for the taxable 
5.24 	year, the estimated tax for that year may be treated as the estimated tax of either the 
5.25 	husband or the wife or may be divided between them.
5.26 	Notwithstanding the provisions of this section, no payments of estimated tax are 
5.27 	required if the estimated tax, as defined in this subdivision, less the credits allowed against 
5.28 	the tax, is less than $500.

5.29 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
5.30 	December 31, 2010.

5.31 	Sec. 6. Minnesota Statutes 2010, section 289A.25, subdivision 6, is amended to read:
5.32 		Subd. 6.Exception to addition to tax. (a) For individuals, no addition to the tax 
5.33 	shall be is imposed under this section for any taxable year if:
6.1 	(1) the taxpayer did not have liability for tax for the preceding taxable year,
6.2 	(2) the preceding taxable year was a taxable year of 12 months, and
6.3 	(3) the individual or trust was a resident of Minnesota throughout the preceding 
6.4 	taxable year.
6.5 	(b) For trusts, S corporations, and partnerships, if in any previous taxable year the 
6.6 	entity was subject to taxation under chapter 290 or composite income tax is elected under 
6.7 	section 289A.08, subdivision 7, then an addition to the tax is imposed under this section. 
6.8 	In all other taxable years, no addition to tax is imposed under this section.

6.9 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
6.10 	December 31, 2010.

6.11 	Sec. 7. Minnesota Statutes 2010, section 289A.25, is amended by adding a subdivision 
6.12 	to read:
6.13 		Subd. 14.Short taxable year. (a) A trust, S corporation, or partnership with a 
6.14 	short taxable year of less than 12 months, but at least four months, must pay estimated 
6.15 	tax in equal installments on or before the 15th day of the third, sixth, ninth, and final 
6.16 	month of the short taxable year, to the extent applicable based on the number of months 
6.17 	in the short taxable year.
6.18 	(b) A trust, S corporation, or partnership is not required to make estimated tax 
6.19 	payments for a short taxable year unless its tax liability before the first day of the last 
6.20 	month of the taxable year can reasonably be expected to exceed $500.
6.21 	(c) No payment is required by a trust, S corporation, or partnership for a short 
6.22 	taxable year of less than four months.

6.23 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
6.24 	December 31, 2010.

6.25 	Sec. 8. Minnesota Statutes 2010, section 289A.26, subdivision 1, is amended to read:
6.26 		Subdivision 1.Minimum liability. A corporation subject to taxation under chapter 
6.27 	290 (excluding section 290.92 and an S corporation under section 290.9725) or an entity 
6.28 	subject to taxation under section 290.05, subdivision 3, must make payment of estimated 
6.29 	tax for the taxable year if its tax liability so computed can reasonably be expected to 
6.30 	exceed $500, or in accordance with rules prescribed by the commissioner for an affiliated 
6.31 	group of corporations filing one return under section 289A.08, subdivision 3.

6.32 	EFFECTIVE DATE. This section is effective for taxable years beginning after 
6.33 	December 31, 2010.

7.1 	Sec. 9. Minnesota Statutes 2010, section 290.92, subdivision 26, is amended to read:
7.2 		Subd. 26.Extension of withholding to certain payments where identifying 
7.3 	number not furnished or inaccurate. (a) If, in the case of any reportable payment, 
7.4 	(1) the payee fails to furnish the payee's Social Security account number to the payor, 
7.5 	(2) the payee is subject to federal backup withholding on the reportable payment under 
7.6 	section 3406 of the Internal Revenue Code, or (3) the commissioner notifies the payor that 
7.7 	the Social Security account number furnished by the payee is incorrect, then the payor 
7.8 	shall deduct and withhold from the payment a tax equal to the amount of the payment 
7.9 	multiplied by the highest rate used in determining the income tax liability of an individual 
7.10 	under section 290.06, subdivision 2c.
7.11 	(b)(1) In the case of any failure described in clause (a)(1), clause (a) shall apply to 
7.12 	any reportable payment made by the payor during the period during which the Social 
7.13 	Security account number has not been furnished.
7.14 	(2) In any case where there is a notification described in clause (a)(3), clause (a) 
7.15 	shall apply to any reportable payment made by the payor (i) after the close of the 30th 
7.16 	day after the day on which the payor received the notification, and (ii) before the payee 
7.17 	furnishes another Social Security account number.
7.18 	(3)(i) Unless the payor elects not to have this subparagraph apply with respect to 
7.19 	the payee, clause (a) shall also apply to any reportable payment made after the close of 
7.20 	the period described in paragraph (1) or (2) (as the case may be) and before the 30th 
7.21 	day after the close of the period.
7.22 	(ii) If the payor elects the application of this subparagraph with respect to the payee, 
7.23 	clause (a) shall also apply to any reportable payment made during the 30-day period 
7.24 	described in paragraph (2).
7.25 	(iii) The payor may elect a period shorter than the grace period set forth in 
7.26 	subparagraph (i) or (ii) as the case may be.
7.27 	(c) The provisions of section 3406 of the Internal Revenue Code shall apply and 
7.28 	shall govern when withholding shall be required and the definition of terms. The term 
7.29 	"reportable payment" shall include only those payments for personal services, including 
7.30 	payments subject to withholding under subdivision 31. No tax shall be deducted or 
7.31 	withheld under this subdivision with respect to any amount for which withholding is 
7.32 	otherwise required under this section. For purposes of this section, payments which are 
7.33 	subject to withholding under this subdivision shall be treated as if they were wages paid 
7.34 	by an employer to an employee and amounts deducted and withheld under this subdivision 
7.35 	shall be treated as if deducted and withheld under subdivision 2a.
8.1 	(d) Whenever the commissioner notifies a payor under this subdivision that the 
8.2 	Social Security account number furnished by any payee is incorrect, the commissioner 
8.3 	shall at the same time furnish a copy of the notice to the payor, and the payor shall 
8.4 	promptly furnish the copy to the payee. If the commissioner notifies a payor under this 
8.5 	subdivision that the Social Security account number furnished by any payee is incorrect 
8.6 	and the payee subsequently furnishes another Social Security account number to the 
8.7 	payor, the payor shall promptly notify the commissioner of the other Social Security 
8.8 	account number furnished.

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

8.10 	ARTICLE 2
8.11 	DEPARTMENT POLICY: ESTATE TAX

8.12 	Section 1. Minnesota Statutes 2010, section 289A.18, subdivision 3, is amended to 
8.13 	read:
8.14 		Subd. 3.Estate tax returns. An estate tax return must be filed with the 
8.15 	commissioner within nine months after the decedent's death. Except in the case of the 
8.16 	estate of a decedent dying after December 31, 2009, and before December 17, 2010, then 
8.17 	an estate tax return must be filed with the commissioner within nine months after the 
8.18 	decedent's death; within the time provided by section 289A.19, subdivision 4; or before 
8.19 	September 20, 2011; whichever is later.

8.20 	EFFECTIVE DATE. This section is effective for estates of decedents dying after 
8.21 	December 31, 2009.

8.22 	Sec. 2. Minnesota Statutes 2010, section 289A.35, is amended to read:
8.23 	289A.35 ASSESSMENTS ON RETURNS.
8.24 	(a) The commissioner may audit and adjust the taxpayer's computation of federal 
8.25 	taxable income, items of federal tax preferences, or federal credit amounts to make them 
8.26 	conform with the provisions of chapter 290 or section 298.01. If a return has been filed, 
8.27 	the commissioner shall enter the liability reported on the return and may make any audit 
8.28 	or investigation that is considered necessary.
8.29 	(b) The commissioner may audit and adjust the taxpayer's computation of tax under 
8.30 	chapter 291. In the case of a return filed pursuant to section 289A.10, the commissioner 
8.31 	shall notify the estate no later than nine months after the filing date, as provided by section 
9.1 	289A.38, subdivision 2, whether the return is under examination or the return has been 
9.2 	processed as filed.

9.3 	EFFECTIVE DATE. This section is effective for estates of decedents dying after 
9.4 	December 31, 2010.

9.5 	Sec. 3. Minnesota Statutes 2010, section 289A.38, subdivision 5, is amended to read:
9.6 		Subd. 5.False or fraudulent return; no return. Notwithstanding the limitations 
9.7 	under subdivisions subdivision 1 and 3, the tax may be assessed at any time if a false or 
9.8 	fraudulent return is filed or when a taxpayer fails to file a return.

9.9 	EFFECTIVE DATE. This section is effective for estates of decedents dying after 
9.10 	December 31, 2010.

9.11 	Sec. 4. Minnesota Statutes 2010, section 291.03, subdivision 1b, is amended to read:
9.12 		Subd. 1b.Qualified terminable interest property. For estates of decedents dying 
9.13 	after December 31, 2009, and before January 1, 2011, if no federal estate tax return is 
9.14 	fileda federal election under section 301(c) of the Tax Relief, Unemployment Insurance 
9.15 	Reauthorization, and Job Creation Act of 2010, Public Law 111-312, is made, the executor 
9.16 	may make a qualified terminable interest property election, as defined in section 2056(b)(7) 
9.17 	of the Internal Revenue Code, for purposes of computing the tax under this chapter. The 
9.18 	election may not reduce the taxable estate under this chapter below $3,500,000. The 
9.19 	election must be made on the tax return under this chapter and is irrevocable. All tax under 
9.20 	this chapter must be determined using the qualified terminable interest property election 
9.21 	made on the Minnesota return. For purposes of applying sections 2044 and 2207A of 
9.22 	the Internal Revenue Code when computing the tax under this chapter for the estate of 
9.23 	the decedent's surviving spouse, regardless of the date of death of the surviving spouse, 
9.24 	amounts for which a qualified terminable interest property election has been made under 
9.25 	this section must be treated as though a valid federal qualified terminable interest property 
9.26 	election under section 2056(b)(7) of the Internal Revenue Code has been made.

9.27 	EFFECTIVE DATE. This section is effective for estates of decedents dying after 
9.28 	December 31, 2009.

9.29 	Sec. 5.  REPEALER.
 9.30 	Minnesota Statutes 2010, section 289A.38, subdivision 3, is repealed.

10.1 	EFFECTIVE DATE. This section is effective for estates of decedents dying after 
10.2 	December 31, 2010.

10.3 	ARTICLE 3
10.4 	DEPARTMENT POLICY: PROPERTY TAX

10.5 	Section 1. Minnesota Statutes 2010, section 270.87, is amended to read:
10.6 	270.87 CERTIFICATION TO COUNTY ASSESSORS.
10.7 	After making an annual determination of the equalized fair market value of the 
10.8 	operating property of each company in each of the respective counties, and in the taxing 
10.9 	districts therein, the commissioner shall certify the equalized fair market value to the 
10.10 	county assessor on or before June 30. The equalized fair market value of the operating 
10.11 	property of the railroad company in the county and the taxing districts therein is the value 
10.12 	on which taxes must be levied and collected in the same manner as on the commercial and 
10.13 	industrial property of such county and the taxing districts therein. If the commissioner 
10.14 	determines that the equalized fair market value certified on or before June 30 is in error, 
10.15 	the commissioner may issue a corrected certification on or before August 31.

10.16 	EFFECTIVE DATE. This section is effective for taxes payable in 2012 and 
10.17 	thereafter.

10.18 	Sec. 2. Minnesota Statutes 2010, section 272.029, is amended by adding a subdivision 
10.19 	to read:
10.20 		Subd. 4a.Correction of errors. If the commissioner of revenue determines that 
10.21 	the amount of production tax has been erroneously calculated, the commissioner may 
10.22 	correct the error. The commissioner must notify the owner of the wind energy conversion 
10.23 	system of the correction and the amount of tax due to each county and must certify the 
10.24 	correction to the county auditor of each county in which the system is located on or before 
10.25 	April 1 of the current year.

10.26 	EFFECTIVE DATE. This section is effective beginning with certifications due 
10.27 	February 28, 2012.

10.28 	Sec. 3. Minnesota Statutes 2010, section 273.124, subdivision 8, is amended to read:
10.29 		Subd. 8.Homestead owned by or leased to family farm corporation, joint farm 
10.30 	venture, limited liability company, or partnership. (a) Each family farm corporation; 
10.31 	each joint family farm venture; and each limited liability company or partnership which 
11.1 	operates a family farm; is entitled to class 1b under section 273.13, subdivision 22, 
11.2 	paragraph (b), or class 2a assessment for one homestead occupied by a shareholder, 
11.3 	member, or partner thereof who is residing on the land, and actively engaged in farming of 
11.4 	the land owned by the family farm corporation, joint family farm venture, limited liability 
11.5 	company, or partnership. Homestead treatment applies even if legal title to the property is 
11.6 	in the name of the family farm corporation, joint family farm venture, limited liability 
11.7 	company, or partnership, and not in the name of the person residing on it.
11.8 	"Family farm corporation," "family farm," and "partnership operating a family 
11.9 	farm" have the meanings given in section 500.24, except that the number of allowable 
11.10 	shareholders, members, or partners under this subdivision shall not exceed 12. "Limited 
11.11 	liability company" has the meaning contained in sections 322B.03, subdivision 28, and 
11.12 	500.24, subdivision 2, paragraphs (l) and (m). "Joint family farm venture" means a 
11.13 	cooperative agreement among two or more farm enterprises authorized to operate a family 
11.14 	farm under section 500.24.
11.15 	(b) In addition to property specified in paragraph (a), any other residences owned 
11.16 	by family farm corporations, joint family farm ventures, limited liability companies, 
11.17 	or partnerships described in paragraph (a) which are located on agricultural land and 
11.18 	occupied as homesteads by its shareholders, members, or partners who are actively 
11.19 	engaged in farming on behalf of that corporation, joint farm venture, limited liability 
11.20 	company, or partnership must also be assessed as class 2a property or as class 1b property 
11.21 	under section 273.13.
11.22 	(c) Agricultural property that is owned by a member, partner, or shareholder of a 
11.23 	family farm corporation or joint family farm venture, limited liability company operating 
11.24 	a family farm, or by a partnership operating a family farm and leased to the family farm 
11.25 	corporation, limited liability company, partnership, or joint farm venture, as defined in 
11.26 	paragraph (a), is eligible for classification as class 1b or class 2a under section 273.13, if 
11.27 	the owner is actually residing on the property, and is actually engaged in farming the land 
11.28 	on behalf of that corporation, joint farm venture, limited liability company, or partnership. 
11.29 	This paragraph applies without regard to any legal possession rights of the family farm 
11.30 	corporation, joint family farm venture, limited liability company, or partnership under 
11.31 	the lease.
11.32 	(d) Nonhomestead agricultural property that (1) is owned by a family farm 
11.33 	corporation, joint farm venture, limited liability company, or partnership; and (2) 
11.34 	is contiguous to a class 2a homestead under section 273.13, subdivision 23, or if 
11.35 	noncontiguous, is located in the same township or city, or not farther than four townships 
11.36 	or cities, or combination thereof from a class 2a homestead, and the class 2a homestead is 
12.1 	owned by one of the shareholders, members, or partners agricultural land that is owned, 
12.2 	and used for the purposes of a homestead by an individual who is a shareholder, member, 
12.3 	or partner of the corporation, venture, company, or partnership; is entitled to receive the 
12.4 	first tier homestead class rate up to the first tier maximum market value on any remaining 
12.5 	market value not received onin the first homestead class tier that is in excess of the 
12.6 	market value of the shareholder's, member's, or partner's homestead class 2a2 agricultural 
12.7 	homestead property., if the owner must notify , or someone acting on the owner's behalf 
12.8 	notifies the county assessor by July 1 that a portion of the market valuethe property may 
12.9 	be eligible under this subdivision may be eligible for homestead classificationparagraph 
12.10 	for the current assessment year, for taxes payable in the following year. As used in this 
12.11 	paragraph, "agricultural property" means property classified as 2a under section 273.13, 
12.12 	along with any contiguous property classified as 2b under section 273.13, if the contiguous 
12.13 	2a and 2b properties are under the same ownership.

12.14 	EFFECTIVE DATE. This section is effective retroactively for taxes payable in 
12.15 	2011 and thereafter.

12.16 	Sec. 4. Minnesota Statutes 2010, section 273.13, subdivision 23, is amended to read:
12.17 		Subd. 23.Class 2. (a) An agricultural homestead consists of class 2a agricultural 
12.18 	land that is homesteaded, along with any class 2b rural vacant land that is contiguous to 
12.19 	the class 2a land under the same ownership. The market value of the house and garage 
12.20 	and immediately surrounding one acre of land has the same class rates as class 1a or 1b 
12.21 	property under subdivision 22. The value of the remaining land including improvements 
12.22 	up to the first tier valuation limit of agricultural homestead property has a net class rate 
12.23 	of 0.5 percent of market value. The remaining property over the first tier has a class rate 
12.24 	of one percent of market value. For purposes of this subdivision, the "first tier valuation 
12.25 	limit of agricultural homestead property" and "first tier" means the limit certified under 
12.26 	section 273.11, subdivision 23.
12.27 	(b) Class 2a agricultural land consists of parcels of property, or portions thereof, that 
12.28 	are agricultural land and buildings. Class 2a property has a net class rate of one percent of 
12.29 	market value, unless it is part of an agricultural homestead under paragraph (a). Class 
12.30 	2a property must also include any property that would otherwise be classified as 2b, 
12.31 	but is interspersed with class 2a property, including but not limited to sloughs, wooded 
12.32 	wind shelters, acreage abutting ditches, ravines, rock piles, land subject to a setback 
12.33 	requirement, and other similar land that is impractical for the assessor to value separately 
12.34 	from the rest of the property or that is unlikely to be able to be sold separately from 
12.35 	the rest of the property.
13.1 	An assessor may classify the part of a parcel described in this subdivision that is used 
13.2 	for agricultural purposes as class 2a and the remainder in the class appropriate to its use.
13.3 	(c) Class 2b rural vacant land consists of parcels of property, or portions thereof, 
13.4 	that are unplatted real estate, rural in character and not used for agricultural purposes, 
13.5 	including land used for growing trees for timber, lumber, and wood and wood products, 
13.6 	that is not improved with a structure. The presence of a minor, ancillary nonresidential 
13.7 	structure as defined by the commissioner of revenue does not disqualify the property from 
13.8 	classification under this paragraph. Any parcel of 20 acres or more improved with a 
13.9 	structure that is not a minor, ancillary nonresidential structure must be split-classified, and 
13.10 	ten acres must be assigned to the split parcel containing the structure. Class 2b property 
13.11 	has a net class rate of one percent of market value unless it is part of an agricultural 
13.12 	homestead under paragraph (a), or qualifies as class 2c under paragraph (d).
13.13 	(d) Class 2c managed forest land consists of no less than 20 and no more than 1,920 
13.14 	acres statewide per taxpayer that is being managed under a forest management plan that 
13.15 	meets the requirements of chapter 290C, but is not enrolled in the sustainable forest 
13.16 	resource management incentive program. It has a class rate of .65 percent, provided that 
13.17 	the owner of the property must apply to the assessor in order for the property to initially 
13.18 	qualify for the reduced rate and provide the information required by the assessor to verify 
13.19 	that the property qualifies for the reduced rate. If the assessor receives the application 
13.20 	and information before May 1 in an assessment year, the property qualifies beginning 
13.21 	with that assessment year. If the assessor receives the application and information after 
13.22 	April 30 in an assessment year, the property may not qualify until the next assessment 
13.23 	year. The commissioner of natural resources must concur that the land is qualified. The 
13.24 	commissioner of natural resources shall annually provide county assessors verification 
13.25 	information on a timely basis. The presence of a minor, ancillary nonresidential structure 
13.26 	as defined by the commissioner of revenue does not disqualify the property from 
13.27 	classification under this paragraph.
13.28 	(e) Agricultural land as used in this section means contiguous acreage of which:
13.29 	(1)of ten acres or more,were used during the preceding year for agricultural 
13.30 	purposes; or
13.31 	(2) less than ten acres are used for an intensive livestock confinement operation, but 
13.32 	land used only for pasturing or grazing does not qualify under this clause.
13.33 	"Agricultural purposes" as used in this section means the raising, cultivation, drying, or 
13.34 	storage of agricultural products for sale, or the storage of machinery or equipment used in 
13.35 	support of agricultural production by the same farm entity. For a property to be classified 
13.36 	as agricultural based only on the drying or storage of agricultural products, the products 
14.1 	being dried or stored must have been produced by the same farm entity as the entity 
14.2 	operating the drying or storage facility. "Agricultural purposes" also includes enrollment 
14.3 	in the Reinvest in Minnesota program under sections 103F.501 to 103F.535 or the federal 
14.4 	Conservation Reserve Program as contained in Public Law 99-198 or a similar state 
14.5 	or federal conservation program if the property was classified as agricultural (i) under 
14.6 	this subdivision for the assessment year 2002 or (ii) in the year prior to its enrollment. 
14.7 	Agricultural classification shall not be based upon the market value of any residential 
14.8 	structures on the parcel or contiguous parcels under the same ownership tract.
14.9 	(f) Real estate of less than ten acres, which is Agricultural land under this section 
14.10 	also includes:
14.11 	(1) any tract that is less than ten acres in size, and does not contain a residence, if 
14.12 	the tract is used exclusively or intensively used for raising or cultivating agricultural 
14.13 	products, shall be considered as agricultural land. To qualify under this paragraph, 
14.14 	property that includes a residential structure must be used intensively for one of the 
14.15 	following purposes:; or
14.16 	(2) any tract that contains a residence if, after excluding the house, garage, and one 
14.17 	acre of surrounding land, the tract is less than ten acres in size and the portion excluding 
14.18 	the house, garage, and surrounding one acre is used for intensive agriculture as described 
14.19 	in and limited by items (i) to (iii):
14.20 	(i) for drying or storage of grain or storage of machinery or equipment used to 
14.21 	support agricultural activities on other parcels tracts of property operated by the same 
14.22 	farming entity;
14.23 	(ii) as a nursery, provided that only those acres used to produce nursery stock are 
14.24 	considered agricultural land; or
14.25 	(iii) for livestock or poultry confinement, provided that land that is used only for 
14.26 	pasturing and grazing does not qualify; or
14.27 	(iv) for market farming; for purposes of this paragraph, "market farming" means the 
14.28 	cultivation of one or more fruits or vegetables or production of animal or other agricultural 
14.29 	products for sale to local markets by the farmer or an organization with which the farmer 
14.30 	is affiliated.
14.31 	(g) Land shall be classified as agricultural even if all or a portion of the agricultural 
14.32 	use of that property is the leasing to, or use by another person for agricultural purposes.
14.33 	Classification under this subdivision is not determinative for qualifying under 
14.34 	section 273.111.
15.1 	(h) The property classification under this section supersedes, for property tax 
15.2 	purposes only, any locally administered agricultural policies or land use restrictions that 
15.3 	define minimum or maximum farm acreage.
15.4 	(i) The term "agricultural products" as used in this subdivision includes production 
15.5 	for sale of:
15.6 	(1) livestock, dairy animals, dairy products, poultry and poultry products, fur-bearing 
15.7 	animals, horticultural and nursery stock, fruit of all kinds, vegetables, forage, grains, 
15.8 	bees, and apiary products by the owner;
15.9 	(2) fish bred for sale and consumption if the fish breeding occurs on land zoned 
15.10 	for agricultural use;
15.11 	(3) the commercial boarding of horses, which may include related horse training and 
15.12 	riding instruction, if the boarding is done on property that is also used for raising pasture 
15.13 	to graze horses or raising or cultivating other agricultural products as defined in clause (1);
15.14 	(4) property which is owned and operated by nonprofit organizations used for 
15.15 	equestrian activities, excluding racing;
15.16 	(5) game birds and waterfowl bred and raised for use on a shooting preserve licensed 
15.17 	under section 97A.115;
15.18 	(6) insects primarily bred to be used as food for animals;
15.19 	(7) trees, grown for sale as a crop, including short rotation woody crops, and not 
15.20 	sold for timber, lumber, wood, or wood products; and
15.21 	(8) maple syrup taken from trees grown by a person licensed by the Minnesota 
15.22 	Department of Agriculture under chapter 28A as a food processor.
15.23 	(j) If a parcel used for agricultural purposes is also used for commercial or industrial 
15.24 	purposes, including but not limited to:
15.25 	(1) wholesale and retail sales;
15.26 	(2) processing of raw agricultural products or other goods;
15.27 	(3) warehousing or storage of processed goods; and
15.28 	(4) office facilities for the support of the activities enumerated in clauses (1), (2), 
15.29 	and (3),
15.30 	the assessor shall classify the part of the parcel used for agricultural purposes as class 
15.31 	1b, 2a, or 2b, whichever is appropriate, and the remainder in the class appropriate to its 
15.32 	use. The grading, sorting, and packaging of raw agricultural products for first sale is 
15.33 	considered an agricultural purpose. A greenhouse or other building where horticultural 
15.34 	or nursery products are grown that is also used for the conduct of retail sales must be 
15.35 	classified as agricultural if it is primarily used for the growing of horticultural or nursery 
15.36 	products from seed, cuttings, or roots and occasionally as a showroom for the retail sale of 
16.1 	those products. Use of a greenhouse or building only for the display of already grown 
16.2 	horticultural or nursery products does not qualify as an agricultural purpose.
16.3 	(k) The assessor shall determine and list separately on the records the market value 
16.4 	of the homestead dwelling and the one acre of land on which that dwelling is located. If 
16.5 	any farm buildings or structures are located on this homesteaded acre of land, their market 
16.6 	value shall not be included in this separate determination.
16.7 	(l) Class 2d airport landing area consists of a landing area or public access area of 
16.8 	a privately owned public use airport. It has a class rate of one percent of market value. 
16.9 	To qualify for classification under this paragraph, a privately owned public use airport 
16.10 	must be licensed as a public airport under section 360.018. For purposes of this paragraph, 
16.11 	"landing area" means that part of a privately owned public use airport properly cleared, 
16.12 	regularly maintained, and made available to the public for use by aircraft and includes 
16.13 	runways, taxiways, aprons, and sites upon which are situated landing or navigational aids. 
16.14 	A landing area also includes land underlying both the primary surface and the approach 
16.15 	surfaces that comply with all of the following:
16.16 	(i) the land is properly cleared and regularly maintained for the primary purposes of 
16.17 	the landing, taking off, and taxiing of aircraft; but that portion of the land that contains 
16.18 	facilities for servicing, repair, or maintenance of aircraft is not included as a landing area;
16.19 	(ii) the land is part of the airport property; and
16.20 	(iii) the land is not used for commercial or residential purposes.
16.21 	The land contained in a landing area under this paragraph must be described and certified 
16.22 	by the commissioner of transportation. The certification is effective until it is modified, 
16.23 	or until the airport or landing area no longer meets the requirements of this paragraph. 
16.24 	For purposes of this paragraph, "public access area" means property used as an aircraft 
16.25 	parking ramp, apron, or storage hangar, or an arrival and departure building in connection 
16.26 	with the airport.
16.27 	(m) Class 2e consists of land with a commercial aggregate deposit that is not actively 
16.28 	being mined and is not otherwise classified as class 2a or 2b, provided that the land is not 
16.29 	located in a county that has elected to opt-out of the aggregate preservation program as 
16.30 	provided in section 273.1115, subdivision 6. It has a class rate of one percent of market 
16.31 	value. To qualify for classification under this paragraph, the property must be at least 
16.32 	ten contiguous acres in size and the owner of the property must record with the county 
16.33 	recorder of the county in which the property is located an affidavit containing:
16.34 	(1) a legal description of the property;
16.35 	(2) a disclosure that the property contains a commercial aggregate deposit that is not 
16.36 	actively being mined but is present on the entire parcel enrolled;
17.1 	(3) documentation that the conditional use under the county or local zoning 
17.2 	ordinance of this property is for mining; and
17.3 	(4) documentation that a permit has been issued by the local unit of government 
17.4 	or the mining activity is allowed under local ordinance. The disclosure must include a 
17.5 	statement from a registered professional geologist, engineer, or soil scientist delineating 
17.6 	the deposit and certifying that it is a commercial aggregate deposit.
17.7 	For purposes of this section and section 273.1115, "commercial aggregate deposit" 
17.8 	means a deposit that will yield crushed stone or sand and gravel that is suitable for use 
17.9 	as a construction aggregate; and "actively mined" means the removal of top soil and 
17.10 	overburden in preparation for excavation or excavation of a commercial deposit.
17.11 	(n) When any portion of the property under this subdivision or subdivision 22 begins 
17.12 	to be actively mined, the owner must file a supplemental affidavit within 60 days from 
17.13 	the day any aggregate is removed stating the number of acres of the property that is 
17.14 	actively being mined. The acres actively being mined must be (1) valued and classified 
17.15 	under subdivision 24 in the next subsequent assessment year, and (2) removed from the 
17.16 	aggregate resource preservation property tax program under section 273.1115, if the 
17.17 	land was enrolled in that program. Copies of the original affidavit and all supplemental 
17.18 	affidavits must be filed with the county assessor, the local zoning administrator, and the 
17.19 	Department of Natural Resources, Division of Land and Minerals. A supplemental 
17.20 	affidavit must be filed each time a subsequent portion of the property is actively mined, 
17.21 	provided that the minimum acreage change is five acres, even if the actual mining activity 
17.22 	constitutes less than five acres.
17.23 	(o) The definitions prescribed by the commissioner under paragraphs (c) and (d) are 
17.24 	not rules and are exempt from the rulemaking provisions of chapter 14, and the provisions 
17.25 	in section 14.386 concerning exempt rules do not apply.

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

17.27 	Sec. 5. Minnesota Statutes 2010, section 273.33, subdivision 2, is amended to read:
17.28 		Subd. 2.Listing and assessment by commissioner. The personal property, 
17.29 	consisting of the pipeline system of mains, pipes, and equipment attached thereto, of 
17.30 	pipeline companies and others engaged in the operations or business of transporting natural 
17.31 	gas, gasoline, crude oil, or other petroleum products by pipelines, shall be listed with and 
17.32 	assessed by the commissioner of revenue and the values provided to the city or county 
17.33 	assessor by order. This subdivision shall not apply to the assessment of the products 
17.34 	transported through the pipelines nor to the lines of local commercial gas companies 
17.35 	engaged primarily in the business of distributing gas to consumers at retail nor to pipelines 
18.1 	used by the owner thereof to supply natural gas or other petroleum products exclusively 
18.2 	for such owner's own consumption and not for resale to others. If more than 85 percent 
18.3 	of the natural gas or other petroleum products actually transported over the pipeline is 
18.4 	used for the owner's own consumption and not for resale to others, then this subdivision 
18.5 	shall not apply; provided, however, that in that event, the pipeline shall be assessed in 
18.6 	proportion to the percentage of gas actually transported over such pipeline that is not used 
18.7 	for the owner's own consumption. On or before August 1, the commissioner shall certify 
18.8 	to the auditor of each county, the amount of such personal property assessment against 
18.9 	each company in each district in which such property is located. If the commissioner 
18.10 	determines that the amount of personal property assessment certified on or before August 
18.11 	1 is in error, the commissioner may issue a corrected certification on or before October 1.

18.12 	EFFECTIVE DATE. This section is effective for taxes payable in 2012 and 
18.13 	thereafter.

18.14 	Sec. 6. Minnesota Statutes 2010, section 273.37, subdivision 2, is amended to read:
18.15 		Subd. 2.Listing and assessment by commissioner. Transmission lines of less 
18.16 	than 69 kv, transmission lines of 69 kv and above located in an unorganized township, 
18.17 	and distribution lines, and equipment attached thereto, having a fixed situs outside the 
18.18 	corporate limits of cities except distribution lines taxed as provided in sections 273.40 
18.19 	and 273.41, shall be listed with and assessed by the commissioner of revenue in the 
18.20 	county where situated and the values provided to the city or county assessor by order. 
18.21 	The commissioner shall assess such property at the percentage of market value fixed by 
18.22 	law; and, on or before August 1, shall certify to the auditor of each county in which 
18.23 	such property is located the amount of the assessment made against each company and 
18.24 	person owning such property. If the commissioner determines that the amount of the 
18.25 	assessment certified on or before August 1 is in error, the commissioner may issue a 
18.26 	corrected certification on or before October 1.

18.27 	EFFECTIVE DATE. This section is effective for taxes payable in 2012 and 
18.28 	thereafter.

18.29 	Sec. 7. Minnesota Statutes 2010, section 273.3711, is amended to read:
18.30 	273.3711 RECOMMENDED AND ORDERED VALUES.
18.31 	For purposes of sections 273.33, 273.35, 273.36, 273.37, 273.371, and 273.372, 
18.32 	all values not required to be listed and assessed by the commissioner of revenue are 
18.33 	recommended values. If the commissioner provides recommended values, the values must 
19.1 	be certified to the auditor of each county in which the property is located on or before 
19.2 	August 1. If the commissioner determines that the certified recommended value is in error 
19.3 	the commissioner may issue a corrected certification on or before October 1.

19.4 	EFFECTIVE DATE. This section is effective for taxes payable in 2012 and 
19.5 	thereafter.

19.6 	Sec. 8. Minnesota Statutes 2010, section 274.175, is amended to read:
19.7 	274.175 VALUES FINALIZED.
19.8 	The assessments recorded by the county assessor and the county auditor under 
19.9 	sections 273.124, subdivision 9; 274.16; 274.17; or other law for real and personal 
19.10 	property are final on July 1 of the assessment year, except for property added to the 
19.11 	assessment rolls under section 272.02, subdivision 38, and assessments certified to the 
19.12 	auditor under sections 270.87;273.33, subdivision 2, and;273.37, subdivision 2,; and 
19.13 	273.3711 or deleted because of tax forfeiture pursuant to chapter 281. No changes in value 
19.14 	may be made after July 1 of the assessment year, except for corrections permitted in 
19.15 	sections 273.01 and 274.01, or assessments certified to the auditor under sections 270.87;
19.16 	273.33, subdivision 2, and;273.37, subdivision 2; and 273.3711.

19.17 	EFFECTIVE DATE. This section is effective for taxes payable in 2012 and 
19.18 	thereafter.

19.19 	ARTICLE 4
19.20 	DEPARTMENT POLICY: SALES AND USE TAX

19.21 	Section 1. Minnesota Statutes 2010, section 289A.60, subdivision 31, is amended to 
19.22 	read:
19.23 		Subd. 31.Accelerated payment of monthly sales tax liability; penalty for 
19.24 	underpayment. For payments made after September 1, 2010, if a vendor is required 
19.25 	by section 289A.20, subdivision 4, paragraph (a), clause (2), item (i) or (ii), to make 
19.26 	accelerated payments, then the penalty for underpayment is as follows:
19.27 	(a) For those vendors that must remit a 90 percent payment by the 14th day of the 
19.28 	month following the month in which the taxable event occurred, as an estimation of the 
19.29 	monthly sales tax liabilities liability, including the liability of any fee or other tax that 
19.30 	is to be reported on the same return as and paid with the chapter 297A taxes, for the 
19.31 	month in which the taxable event occurred, the vendor shall pay a penalty equal to ten 
19.32 	percent of the amount of liability that was required to be paid by the 14th day of the 
20.1 	month, less the amount remitted by the 14th day of the month. The penalty must not be 
20.2 	imposed, however, if the amount remitted by the 14th day of the month equals the least 
20.3 	of: (1) 90 percent of the liability for the month preceding the month in which the taxable 
20.4 	event occurred; (2) 90 percent of the liability for the same month in the previous calendar 
20.5 	year as the month in which the taxable event occurred; or (3) 90 percent of the average 
20.6 	monthly liability for the previous calendar year.
20.7 	(b) For those vendors that, on or before the 20th day of the month in which the 
20.8 	taxable event occurs, must remit to the commissioner a prepayment of the sales tax 
20.9 	liabilitiesliability for the month in which the taxable event occurs equal to 67 percent of 
20.10 	the liabilitiesliability for the previous month, including the liability of any fee or other tax 
20.11 	that is to be reported on the same return as and paid with the chapter 297A taxes, for the 
20.12 	month in which the taxable event occurred, the vendor shall pay a penalty equal to ten 
20.13 	percent of the amount of liability that was required to be paid by the 20th of the month, 
20.14 	less the amount remitted by the 20th of the month. The penalty must not be imposed, 
20.15 	however, if the amount remitted by the 20th of the month equals the lesser of 67 percent 
20.16 	of the liability for the month preceding the month in which the taxable event occurred 
20.17 	or: (1) 67 percent of the liability of the same month in the previous calendar year as the 
20.18 	month in which the taxable event occurred; or (2) an amount equal to the liability for the 
20.19 	month in which the taxable event occurred.

20.20 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
20.21 	June 30, 2011.

20.22 	Sec. 2. Minnesota Statutes 2010, section 297A.62, is amended by adding a subdivision 
20.23 	to read:
20.24 		Subd. 5.Transitional period for services. When there is a change in the rate of tax 
20.25 	imposed by this section, the following transitional period shall apply to the retail sale of 
20.26 	services covering a billing period starting before and ending after the statutory effective 
20.27 	date of the rate change:
20.28 	(1) for a rate increase, the new rate shall apply to the first billing period starting 
20.29 	on or after the effective date; and
20.30 	(2) for a rate decrease, the new rate shall apply to bills rendered on or after the 
20.31 	effective date.

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

21.1 	Sec. 3. Minnesota Statutes 2010, section 297A.63, is amended by adding a subdivision 
21.2 	to read:
21.3 		Subd. 3.Transitional period for services. When there is a change in the rate of 
21.4 	tax imposed by this section, the following transitional period shall apply to the taxable 
21.5 	services purchased for use, storage, distribution, or consumption in this state when the 
21.6 	service purchased covers a billing period starting before and ending after the statutory 
21.7 	effective date of the rate change:
21.8 	(1) for a rate increase, the new rate shall apply to the first billing period starting 
21.9 	on or after the effective date; and
21.10 	(2) for a rate decrease, the new rate shall apply to bills rendered on or after the 
21.11 	effective date.

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

21.13 	Sec. 4. Minnesota Statutes 2010, section 297A.668, subdivision 7, is amended to read:
21.14 		Subd. 7.Advertising and promotional direct mail. (a) Notwithstanding other 
21.15 	subdivisions of this section, the provisions in paragraphs (b) to (e) apply to the sale of 
21.16 	advertising and promotional direct mail. "Advertising and promotional direct mail" means 
21.17 	printed material that is direct mail as defined in section 297A.61, subdivision 35, the 
21.18 	primary purpose of which is to attract public attention to a product, person, business, or 
21.19 	organization, or to attempt to sell, popularize, or secure financial support for a person, 
21.20 	business, organization, or product. "Product" includes tangible personal property, a digital 
21.21 	product transferred electronically, or a service.
21.22 	(b) A purchaser of advertising and promotional direct mail that is not a holder of 
21.23 	a direct pay permit shall provide to the seller, in conjunction with the purchase, either a 
21.24 	direct mail form or may provide the seller with either:
21.25 	(1) a fully completed exemption certificate as described in section 297A.72 
21.26 	indicating that the purchaser is authorized to pay any sales or use tax due on purchases 
21.27 	made by the purchaser directly to the commissioner under section 297A.89;
21.28 	(2) a fully completed exemption certificate claiming an exemption for direct mail; or
21.29 	(3) information to show showing the jurisdictions to which the advertising and 
21.30 	promotional direct mail is to be delivered to recipients.
21.31 	(1) Upon receipt of the direct mail form, (c) In the absence of bad faith, if the 
21.32 	purchaser provides one of the exemption certificates indicated in paragraph (b), clauses (1) 
21.33 	and (2), the seller is relieved of all obligations to collect, pay, or remit the applicable tax 
21.34 	and the purchaser is obligated to pay or remit the applicable tax on a direct pay basis. A 
21.35 	direct mail form remains in effect for all future sales of direct mail by the seller to the 
22.1 	purchaser until it is revoked in writing. tax on any transaction involving advertising and 
22.2 	promotional direct mail to which the certificate applies. The purchaser shall source the 
22.3 	sale to the jurisdictions to which the advertising and promotional direct mail is to be 
22.4 	delivered to the recipients of the mail, and shall report and pay any applicable tax due.
22.5 	(2) Upon receipt of (d) If the purchaser provides the seller information from the 
22.6 	purchaser showing the jurisdictions to which the advertising and promotional direct mail 
22.7 	is to be delivered to recipients, the seller shall source the sale to the jurisdictions to which 
22.8 	the advertising and promotional direct mail is to be delivered and shall collect and remit
22.9 	the applicable tax according to the delivery information provided by the purchaser. In 
22.10 	the absence of bad faith, the seller is relieved of any further obligation to collect any 
22.11 	additional tax on any transaction for which the sale of advertising and promotional direct 
22.12 	mail where the seller has collected tax pursuant sourced the sale according to the delivery 
22.13 	information provided by the purchaser.
22.14 	(b) (e) If the purchaser of direct mail does not have a direct pay permit and does 
22.15 	not provide the seller with either a direct mail form or delivery information, as required 
22.16 	by paragraph (a), the seller shall collect the tax according to any of the items listed in 
22.17 	paragraph (b), the sale shall be sourced under subdivision 2, paragraph (f). Nothing in 
22.18 	this paragraph limits a purchaser's obligation for sales or use tax to any state to which the 
22.19 	direct mail is delivered.
22.20 	(c) If a purchaser of direct mail provides the seller with documentation of direct 
22.21 	pay authority, the purchaser is not required to provide a direct mail form or delivery 
22.22 	information to the seller.
22.23 	(f) This subdivision does not apply to printed materials that result from developing 
22.24 	billing information or providing any data processing service that is more than incidental 
22.25 	to producing the printed materials, regardless of whether advertising and promotional 
22.26 	direct mail is included in the same mailing.
22.27 	(g) If a transaction is a bundled transaction that includes advertising and promotional 
22.28 	direct mail, this subdivision applies only if the primary purpose of the transaction is the sale 
22.29 	of products or services that meet the definition of advertising and promotional direct mail.

22.30 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
22.31 	June 30, 2011.

22.32 	Sec. 5. Minnesota Statutes 2010, section 297A.668, is amended by adding a 
22.33 	subdivision to read:
22.34 		Subd. 7a.Other direct mail. (a) Notwithstanding other subdivisions of this section, 
22.35 	the provisions in paragraphs (b) and (c) apply to the sale of other direct mail. "Other direct 
23.1 	mail" means printed material that is direct mail as defined in section 297A.61, subdivision 
23.2 	35, but is not advertising and promotional direct mail as described in subdivision 7, 
23.3 	regardless of whether advertising and promotional direct mail is included in the same 
23.4 	mailing. Other direct mail includes, but is not limited to:
23.5 	(1) direct mail pertaining to a transaction between the purchaser and addressee, 
23.6 	where the mail contains personal information specific to the addressee including, but not 
23.7 	limited to, invoices, bills, statements of account, and payroll advices;
23.8 	(2) any legally required mailings including, but not limited to, privacy notices, 
23.9 	tax reports, and stockholder reports; and
23.10 	(3) other nonpromotional direct mail delivered to existing or former shareholders, 
23.11 	customers, employees, or agents including, but not limited to, newsletters and 
23.12 	informational pieces.
23.13 	Other direct mail does not include printed materials that result from developing 
23.14 	billing information or providing any data processing service that is more than incidental to 
23.15 	producing the other direct mail.
23.16 	(b) A purchaser of other direct mail may provide the seller with either a fully 
23.17 	completed exemption certificate as described in section 297A.72 indicating that the 
23.18 	purchaser is authorized to pay any sales or use tax due on purchases made by the purchaser 
23.19 	directly to the commissioner under section 297A.89, or a fully completed exemption 
23.20 	certificate claiming an exemption for direct mail. If the purchaser provides one of the 
23.21 	exemption certificates listed, then the seller, in the absence of bad faith, is relieved of all 
23.22 	obligations to collect, pay, or remit the tax on any transaction involving other direct mail 
23.23 	to which the certificate applies. The purchaser shall source the sale to the jurisdictions to 
23.24 	which the other direct mail is to be delivered to the recipients of the mail, and shall report 
23.25 	and pay any applicable tax due.
23.26 	(c) If the purchaser does not provide the seller with a fully completed exemption 
23.27 	certificate claiming either exemption listed in paragraph (b), the sale shall be sourced 
23.28 	according to subdivision 2, paragraph (d).

23.29 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
23.30 	June 30, 2011.

23.31 	Sec. 6. Laws 1986, chapter 462, section 31, as amended by Laws 1991, chapter 291, 
23.32 	article 8, section 24, is amended to read:
23.33 	Sec. 31. AUTHORITY FOR TAXATION.
 23.34 	Notwithstanding Minnesota Statutes, section 477A.016, or any other law, and 
23.35 	supplemental to the tax imposed by Laws 1982, chapter 523, article 25, section 1, the city 
24.1 	of St. Paul may impose, by ordinance, a tax, at a rate not greater than three percent, on the 
24.2 	gross receipts from the furnishing for consideration of lodging and related services at a 
24.3 	hotel, rooming house, tourist court, motel, or resort, other than the renting or leasing of 
24.4 	space for a continuous period of 30 days or more. The tax does not apply to the furnishing 
24.5 	of lodging and related services by a business having less than 50 lodging rooms. The tax 
24.6 	shall be collected by and its proceeds paid to the city. Ninety-five percent of the revenues 
24.7 	generated by this tax shall be used to fund a convention bureau to market and promote 
24.8 	the city as a tourist or convention center.

24.9 	EFFECTIVE DATE. This section is effective for sales and purchases made after 
24.10 	June 30, 2011.

24.11 	ARTICLE 5
24.12 	DEPARTMENT POLICY: MISCELLANEOUS

24.13 	Section 1. Minnesota Statutes 2010, section 69.031, subdivision 1, is amended to read:
24.14 		Subdivision 1.Commissioner's warrant. (a) The commissioner of management 
24.15 	and budget shall issue to the Public Employees Retirement Association on behalf of 
24.16 	a municipality or independent nonprofit firefighting corporation that is a member of the 
24.17 	voluntary statewide lump-sum volunteer firefighter retirement plan under chapter 353G 
24.18 	or to the county, municipality, or independent nonprofit firefighting corporation certified 
24.19 	to the commissioner of management and budget by the commissioner a warrant for an 
24.20 	amount equal to the amount of fire state aid or police state aid, whichever applies, certified 
24.21 	for the applicable state aid recipient by the commissioner under section 69.021.
24.22 	(b) The amount of state aid due and not paid by October 1 accrues interest at the rate 
24.23 	of one percent for each month or part of a month the amount remains unpaid, beginning 
24.24 	the preceding July 1 after October 1.

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

24.26 	Sec. 2. [270C.101] APPLICATION FOR BUSINESS REGISTRATION; 
24.27 	CERTAIN INFORMATION NOT REQUIRED.
24.28 	Notwithstanding any law to the contrary, an entity applying for a Minnesota business 
24.29 	tax account number is not required to list the names, home addresses, and Social Security 
24.30 	numbers of its officers or directors when the entity applying for an account number is an 
24.31 	instrumentality of a state, a local, or the federal government, or a tribal government.

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

25.1 	Sec. 3. [270C.301] ROUNDING OF DOLLAR AMOUNTS REPORTED ON 
25.2 	TAX FORMS.
25.3 	Where not otherwise provided by law, in computing the dollar amount of items 
25.4 	reported on any return or other document, and accompanying schedules, filed with the 
25.5 	commissioner, money items may, in the discretion of the commissioner, be rounded off to 
25.6 	the nearest whole dollar amount, disregarding amounts less than 50 cents and increasing 
25.7 	amounts of 50 cents to 99 cents to the next highest dollar.

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

25.9 	Sec. 4. Minnesota Statutes 2010, section 270C.32, subdivision 3, is amended to read:
25.10 		Subd. 3.Third-party subpoena where taxpayer's identity is known. (a) An 
25.11 	examination or investigation may extend to a person that the commissioner determines has 
25.12 	access to information that may be relevant to the examination or investigation. When a 
25.13 	subpoena requiring the production of records as described in subdivision 1 is served on a 
25.14 	third-party record keeper, written notice of the subpoena must be mailed to the taxpayer 
25.15 	and to any other person who is identified in the subpoena. The notices must be given 
25.16 	within three days of the day on which the subpoena is served. The notice required by this 
25.17 	subdivision is sufficient if it is mailed to the last known address of the addressee.
25.18 	(b) The provisions of this subdivision regarding notice to the taxpayer or other 
25.19 	parties identified in the subpoena do not apply if there is reasonable cause to believe 
25.20 	that the giving of notice may lead to attempts to conceal, destroy, or alter records or 
25.21 	assets relevant to the examination, to prevent the communication of information from 
25.22 	other persons through intimidation, bribery, or collusion, or to flee to avoid prosecution, 
25.23 	testifying, or production of records. Notice is not required under this subdivision or under 
25.24 	another law if the taxpayer or other parties identified in the subpoena are under criminal 
25.25 	investigation, and the subpoena has been issued as part of the criminal investigation.
25.26 	(c) A third-party record keeper who is advised that a subpoena has been issued as 
25.27 	part of a criminal investigation is prohibited from informing by any means the taxpayer 
25.28 	or other parties identified in the subpoena of the receipt of the subpoena, the contents of 
25.29 	the subpoena, or the fact that the taxpayer or other parties identified may be or are under 
25.30 	criminal investigation.

25.31 	EFFECTIVE DATE. This section is effective for subpoenas served after the day 
25.32 	following final enactment.

26.1 	Sec. 5. Minnesota Statutes 2010, section 270C.64, is amended to read:
26.2 	270C.64 CREDIT OF OVERPAYMENT OR PAYMENT TO DELINQUENT 
26.3 	TAX LIABILITIES.
26.4 	Notwithstanding any other provision of law to the contrary, in the case of an 
26.5 	overpayment of any tax collected by the commissioner, or any refund, credit, claim, or 
26.6 	other payment payable by the commissioner to any person under a law administered by the 
26.7 	commissioner, the commissioner may credit the amount of such overpayment or payment
26.8 	against any uncontested delinquent tax liability on the part of the taxpayer person who 
26.9 	made is entitled to the overpayment or payment. An overpayment or payment may be 
26.10 	credited under this section only if the uncontested delinquent liability has been assessed 
26.11 	within ten years of the date on which the overpayment or payment is credited. However, 
26.12 	this limitation shall not be applicable if the delinquent liability has been entered into 
26.13 	judgment or if legal action is pending for collection of the liability or for renewal of the 
26.14 	judgment. An amount paid as tax shall constitute an overpayment even if in fact there was 
26.15 	no tax liability with respect to which such amount was paid.

26.16 	EFFECTIVE DATE. This section is effective for liabilities becoming delinquent 
26.17 	after the day of final enactment.

26.18 	Sec. 6. Minnesota Statutes 2010, section 270C.711, is amended to read:
26.19 	270C.711 ACQUISITION AND RESALE OF SEIZED PROPERTY.
26.20 	For the purpose of enabling the commissioner to purchase or redeem seized property 
26.21 	in which the state of Minnesota has an interest arising from a lien for unpaid taxes, or 
26.22 	to provide for the operating costs of collection activities of the department, there is 
26.23 	appropriated to the commissioner an amount representing the cost of such purchases, 
26.24 	redemptions, or collection activities. Seized property acquired by the state of Minnesota 
26.25 	to satisfy unpaid taxes shall be resold by the commissioner. The commissioner shall 
26.26 	preserve the value of seized property while controlling it, including but not limited to 
26.27 	the procurement of insurance. For the purpose of refunding the proceeds from the sale 
26.28 	of levied or redeemed property which are in excess of the actual tax liability plus costs 
26.29 	of acquiring the property, there is hereby created a levied and redeemed property refund 
26.30 	account in the agency fund. All amounts deposited into this account are appropriated to 
26.31 	the commissioner. The commissioner shall report quarterly annually on the status of this 
26.32 	program to the chairs and ranking minority members of the house of representatives 
26.33 	taxes and Ways and Means Committees and senate Taxes and Tax Laws and Finance 
27.1 	Committees legislative committees having jurisdiction over taxes and finance of the house 
27.2 	of representatives and senate.

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

27.4 	Sec. 7. Minnesota Statutes 2010, section 287.05, subdivision 2, is amended to read:
27.5 		Subd. 2.Supplemental mortgages. (a) Except for an amendment or a revision to a 
27.6 	reverse mortgage as described under subdivision 6, any document that alters an existing 
27.7 	mortgage by providing for an increase in the amount of debt secured by real property 
27.8 	located in this state, or, in the case of a multistate mortgage described in subdivision 1, 
27.9 	paragraph (b), an increase in the percentage of Minnesota real estate as compared to 
27.10 	the total real estate that is encumbered by the mortgage, shall be taxed based upon the 
27.11 	increase in the amount of the debt determined to be secured by real property located in 
27.12 	this state under either subdivision 1 or 1a.
27.13 	(b) Except as provided in subdivision 3, any document that alters an existing 
27.14 	mortgage to secure debt that was (i) advanced, (ii) repaid in whole or in part, and (iii) then 
27.15 	readvanced in whole or in part, shall be taxed based upon the new amounts advanced, even 
27.16 	if the maximum debt previously secured by the mortgage is not exceeded.

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

27.18 	Sec. 8.  REPEALER.
 27.19 	Minnesota Statutes 2010, sections 290.06, subdivision 10; and 290A.27, are repealed.

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

27.21 	ARTICLE 6
27.22 	DEPARTMENT TECHNICAL: INCOME TAX

27.23 	Section 1. Minnesota Statutes 2010, section 290.01, subdivision 19a, is amended to 
27.24 	read:
27.25 		Subd. 19a.Additions to federal taxable income. For individuals, estates, and 
27.26 	trusts, there shall be added to federal taxable income:
27.27 	(1)(i) interest income on obligations of any state other than Minnesota or a political 
27.28 	or governmental subdivision, municipality, or governmental agency or instrumentality 
27.29 	of any state other than Minnesota exempt from federal income taxes under the Internal 
27.30 	Revenue Code or any other federal statute; and
28.1 	(ii) exempt-interest dividends as defined in section 852(b)(5) of the Internal Revenue 
28.2 	Code, except:
28.3 	(A) the portion of the exempt-interest dividends exempt from state taxation under 
28.4 	the laws of the United States; and
28.5 	(B) the portion of the exempt-interest dividends derived from interest income 
28.6 	on obligations of the state of Minnesota or its political or governmental subdivisions, 
28.7 	municipalities, governmental agencies or instrumentalities, but only if the portion of the 
28.8 	exempt-interest dividends from such Minnesota sources paid to all shareholders represents 
28.9 	95 percent or more of the exempt-interest dividends, including any dividends exempt 
28.10 	under subitem (A), that are paid by the regulated investment company as defined in section 
28.11 	851(a) of the Internal Revenue Code, or the fund of the regulated investment company as 
28.12 	defined in section 851(g) of the Internal Revenue Code, making the payment; and
28.13 	(iii) for the purposes of items (i) and (ii), interest on obligations of an Indian tribal 
28.14 	government described in section 7871(c) of the Internal Revenue Code shall be treated as 
28.15 	interest income on obligations of the state in which the tribe is located;
28.16 	(2) the amount of income, sales and use, motor vehicle sales, or excise taxes paid 
28.17 	or accrued within the taxable year under this chapter and the amount of taxes based on 
28.18 	net income paid, sales and use, motor vehicle sales, or excise taxes paid to any other 
28.19 	state or to any province or territory of Canada, to the extent allowed as a deduction 
28.20 	under section 63(d) of the Internal Revenue Code, but the addition may not be more 
28.21 	than the amount by which the itemized deductions as allowed under section 63(d) of 
28.22 	the Internal Revenue Code exceeds the amount of the standard deduction as defined in 
28.23 	section 63(c) of the Internal Revenue Code, disregarding the amounts allowed under 
28.24 	sections 63(c)(1)(C) and 63(c)(1)(E) of the Internal Revenue Code. For the purpose of 
28.25 	this paragraph, the disallowance of itemized deductions under section 68 of the Internal 
28.26 	Revenue Code of 1986, income, sales and use, motor vehicle sales, or excise taxes are 
28.27 	the last itemized deductions disallowed;
28.28 	(3) the capital gain amount of a lump-sum distribution to which the special tax under 
28.29 	section 1122(h)(3)(B)(ii) of the Tax Reform Act of 1986, Public Law 99-514, applies;
28.30 	(4) the amount of income taxes paid or accrued within the taxable year under this 
28.31 	chapter and taxes based on net income paid to any other state or any province or territory 
28.32 	of Canada, to the extent allowed as a deduction in determining federal adjusted gross 
28.33 	income. For the purpose of this paragraph, income taxes do not include the taxes imposed 
28.34 	by sections 290.0922, subdivision 1, paragraph (b), 290.9727, 290.9728, and 290.9729;
29.1 	(5) the amount of expense, interest, or taxes disallowed pursuant to section 290.10 
29.2 	other than expenses or interest used in computing net interest income for the subtraction 
29.3 	allowed under subdivision 19b, clause (1);
29.4 	(6) the amount of a partner's pro rata share of net income which does not flow 
29.5 	through to the partner because the partnership elected to pay the tax on the income under 
29.6 	section 6242(a)(2) of the Internal Revenue Code;
29.7 	(7) 80 percent of the depreciation deduction allowed under section 168(k) of the 
29.8 	Internal Revenue Code. For purposes of this clause, if the taxpayer has an activity that 
29.9 	in the taxable year generates a deduction for depreciation under section 168(k) and the 
29.10 	activity generates a loss for the taxable year that the taxpayer is not allowed to claim for 
29.11 	the taxable year, "the depreciation allowed under section 168(k)" for the taxable year is 
29.12 	limited to excess of the depreciation claimed by the activity under section 168(k) over the 
29.13 	amount of the loss from the activity that is not allowed in the taxable year. In succeeding 
29.14 	taxable years when the losses not allowed in the taxable year are allowed, the depreciation 
29.15 	under section 168(k) is allowed;
29.16 	(8) 80 percent of the amount by which the deduction allowed by section 179 of the 
29.17 	Internal Revenue Code exceeds the deduction allowable by section 179 of the Internal 
29.18 	Revenue Code of 1986, as amended through December 31, 2003;
29.19 	(9) to the extent deducted in computing federal taxable income, the amount of the 
29.20 	deduction allowable under section 199 of the Internal Revenue Code;
29.21 	(10) the exclusion allowed under section 139A of the Internal Revenue Code for 
29.22 	federal subsidies for prescription drug plans;
29.23 	(11) the amount of expenses disallowed under section 290.10, subdivision 2;
29.24 	(12) the amount deducted for qualified tuition and related expenses under section 
29.25 	222 of the Internal Revenue Code, to the extent deducted from gross income;
29.26 	(13) the amount deducted for certain expenses of elementary and secondary school 
29.27 	teachers under section 62(a)(2)(D) of the Internal Revenue Code, to the extent deducted 
29.28 	from gross income;
29.29 	(14) the additional standard deduction for property taxes payable that is allowable 
29.30 	under section 63(c)(1)(C) of the Internal Revenue Code;
29.31 	(15) the additional standard deduction for qualified motor vehicle sales taxes 
29.32 	allowable under section 63(c)(1)(E) of the Internal Revenue Code;
29.33 	(16) discharge of indebtedness income resulting from reacquisition of business 
29.34 	indebtedness and deferred under section 108(i) of the Internal Revenue Code; and
29.35 	(17) the amount of unemployment compensation exempt from tax under section 
29.36 	85(c) of the Internal Revenue Code; and
30.1 	(18) changes to federal taxable income attributable to a net operating loss that the 
30.2 	taxpayer elected to carry back for more than two years for federal purposes but for which 
30.3 	the losses can be carried back for only two years under section 290.095, subdivision 
30.4 	11, paragraph (c).

30.5 	EFFECTIVE DATE. This section is effective retroactively for losses generated in 
30.6 	taxable years beginning after December 31, 2007.

30.7 	Sec. 2. Minnesota Statutes 2010, section 290.01, subdivision 19b, is amended to read:
30.8 		Subd. 19b.Subtractions from federal taxable income. For individuals, estates, 
30.9 	and trusts, there shall be subtracted from federal taxable income:
30.10 	(1) net interest income on obligations of any authority, commission, or 
30.11 	instrumentality of the United States to the extent includable in taxable income for federal 
30.12 	income tax purposes but exempt from state income tax under the laws of the United States;
30.13 	(2) if included in federal taxable income, the amount of any overpayment of income 
30.14 	tax to Minnesota or to any other state, for any previous taxable year, whether the amount 
30.15 	is received as a refund or as a credit to another taxable year's income tax liability;
30.16 	(3) the amount paid to others, less the amount used to claim the credit allowed under 
30.17 	section 290.0674, not to exceed $1,625 for each qualifying child in grades kindergarten 
30.18 	to 6 and $2,500 for each qualifying child in grades 7 to 12, for tuition, textbooks, and 
30.19 	transportation of each qualifying child in attending an elementary or secondary school 
30.20 	situated in Minnesota, North Dakota, South Dakota, Iowa, or Wisconsin, wherein a 
30.21 	resident of this state may legally fulfill the state's compulsory attendance laws, which 
30.22 	is not operated for profit, and which adheres to the provisions of the Civil Rights Act 
30.23 	of 1964 and chapter 363A. For the purposes of this clause, "tuition" includes fees or 
30.24 	tuition as defined in section 290.0674, subdivision 1, clause (1). As used in this clause, 
30.25 	"textbooks" includes books and other instructional materials and equipment purchased 
30.26 	or leased for use in elementary and secondary schools in teaching only those subjects 
30.27 	legally and commonly taught in public elementary and secondary schools in this state. 
30.28 	Equipment expenses qualifying for deduction includes expenses as defined and limited in 
30.29 	section 290.0674, subdivision 1, clause (3). "Textbooks" does not include instructional 
30.30 	books and materials used in the teaching of religious tenets, doctrines, or worship, the 
30.31 	purpose of which is to instill such tenets, doctrines, or worship, nor does it include books 
30.32 	or materials for, or transportation to, extracurricular activities including sporting events, 
30.33 	musical or dramatic events, speech activities, driver's education, or similar programs. No 
30.34 	deduction is permitted for any expense the taxpayer incurred in using the taxpayer's or 
30.35 	the qualifying child's vehicle to provide such transportation for a qualifying child. For 
31.1 	purposes of the subtraction provided by this clause, "qualifying child" has the meaning 
31.2 	given in section 32(c)(3) of the Internal Revenue Code;
31.3 	(4) income as provided under section 290.0802;
31.4 	(5) to the extent included in federal adjusted gross income, income realized on 
31.5 	disposition of property exempt from tax under section 290.491;
31.6 	(6) to the extent not deducted or not deductible pursuant to section 408(d)(8)(E) 
31.7 	of the Internal Revenue Code in determining federal taxable income by an individual 
31.8 	who does not itemize deductions for federal income tax purposes for the taxable year, an 
31.9 	amount equal to 50 percent of the excess of charitable contributions over $500 allowable 
31.10 	as a deduction for the taxable year under section 170(a) of the Internal Revenue Code, 
31.11 	under the provisions of Public Law 109-1 and Public Law 111-126;
31.12 	(7) for individuals who are allowed a federal foreign tax credit for taxes that do not 
31.13 	qualify for a credit under section 290.06, subdivision 22, an amount equal to the carryover 
31.14 	of subnational foreign taxes for the taxable year, but not to exceed the total subnational 
31.15 	foreign taxes reported in claiming the foreign tax credit. For purposes of this clause, 
31.16 	"federal foreign tax credit" means the credit allowed under section 27 of the Internal 
31.17 	Revenue Code, and "carryover of subnational foreign taxes" equals the carryover allowed 
31.18 	under section 904(c) of the Internal Revenue Code minus national level foreign taxes to 
31.19 	the extent they exceed the federal foreign tax credit;
31.20 	(8) in each of the five tax years immediately following the tax year in which an 
31.21 	addition is required under subdivision 19a, clause (7), or 19c, clause (15), in the case 
31.22 	of a shareholder of a corporation that is an S corporation, an amount equal to one-fifth 
31.23 	of the delayed depreciation. For purposes of this clause, "delayed depreciation" means 
31.24 	the amount of the addition made by the taxpayer under subdivision 19a, clause (7), or 
31.25 	subdivision 19c, clause (15), in the case of a shareholder of an S corporation, minus the 
31.26 	positive value of any net operating loss under section 172 of the Internal Revenue Code 
31.27 	generated for the tax year of the addition. The resulting delayed depreciation cannot be 
31.28 	less than zero;
31.29 	(9) job opportunity building zone income as provided under section 469.316;
31.30 	(10) to the extent included in federal taxable income, the amount of compensation 
31.31 	paid to members of the Minnesota National Guard or other reserve components of the 
31.32 	United States military for active service performed in Minnesota, excluding compensation 
31.33 	for services performed under the Active Guard Reserve (AGR) program. For purposes of 
31.34 	this clause, "active service" means (i) state active service as defined in section 190.05, 
31.35 	subdivision 5a, clause (1); or (ii) federally funded state active service as defined in 
31.36 	section 190.05, subdivision 5b; or (iii) federal active service as defined in section 190.05, 
32.1 	subdivision 5c, but "active service" excludes service performed in accordance with section 
32.2 	190.08, subdivision 3;
32.3 	(11) to the extent included in federal taxable income, the amount of compensation 
32.4 	paid to Minnesota residents who are members of the armed forces of the United States or 
32.5 	United Nations for active duty performed outside Minnesota under United States Code, 
32.6 	title 10, section 101(d); United States Code, title 32, section 101(12); or the authority of 
32.7 	the United Nations;
32.8 	(12) an amount, not to exceed $10,000, equal to qualified expenses related to a 
32.9 	qualified donor's donation, while living, of one or more of the qualified donor's organs 
32.10 	to another person for human organ transplantation. For purposes of this clause, "organ" 
32.11 	means all or part of an individual's liver, pancreas, kidney, intestine, lung, or bone marrow; 
32.12 	"human organ transplantation" means the medical procedure by which transfer of a human 
32.13 	organ is made from the body of one person to the body of another person; "qualified 
32.14 	expenses" means unreimbursed expenses for both the individual and the qualified donor 
32.15 	for (i) travel, (ii) lodging, and (iii) lost wages net of sick pay, except that such expenses 
32.16 	may be subtracted under this clause only once; and "qualified donor" means the individual 
32.17 	or the individual's dependent, as defined in section 152 of the Internal Revenue Code. An 
32.18 	individual may claim the subtraction in this clause for each instance of organ donation for 
32.19 	transplantation during the taxable year in which the qualified expenses occur;
32.20 	(13) in each of the five tax years immediately following the tax year in which an 
32.21 	addition is required under subdivision 19a, clause (8), or 19c, clause (16), in the case of a 
32.22 	shareholder of a corporation that is an S corporation, an amount equal to one-fifth of the 
32.23 	addition made by the taxpayer under subdivision 19a, clause (8), or 19c, clause (16), in the 
32.24 	case of a shareholder of a corporation that is an S corporation, minus the positive value of 
32.25 	any net operating loss under section 172 of the Internal Revenue Code generated for the 
32.26 	tax year of the addition. If the net operating loss exceeds the addition for the tax year, a 
32.27 	subtraction is not allowed under this clause;
32.28 	(14) to the extent included in the federal taxable income of a nonresident of 
32.29 	Minnesota, compensation paid to a service member as defined in United States Code, title 
32.30 	10, section 101(a)(5), for military service as defined in the Servicemembers Civil Relief 
32.31 	Act, Public Law 108-189, section 101(2);
32.32 	(15) international economic development zone income as provided under section 
32.33 	469.325;
32.34 	(16) to the extent included in federal taxable income, the amount of national service 
32.35 	educational awards received from the National Service Trust under United States Code, 
33.1 	title 42, sections 12601 to 12604, for service in an approved Americorps National Service 
33.2 	program; and
33.3 	(17) to the extent included in federal taxable income, discharge of indebtedness 
33.4 	income resulting from reacquisition of business indebtedness included in federal taxable 
33.5 	income under section 108(i) of the Internal Revenue Code. This subtraction applies only 
33.6 	to the extent that the income was included in net income in a prior year as a result of the 
33.7 	addition under section 290.01, subdivision 19a, clause (16); and
33.8 	(18) the amount of the net operating loss allowed under section 290.095, subdivision 
33.9 	11, paragraph (c).

33.10 	EFFECTIVE DATE. The changes to clauses (10), (11), and (14) are effective the 
33.11 	day following final enactment. Clause (18) is effective retroactively for losses generated 
33.12 	in taxable years beginning after December 31, 2007.

33.13 	Sec. 3. Minnesota Statutes 2010, section 290.06, subdivision 2c, is amended to read:
33.14 		Subd. 2c.Schedules of rates for individuals, estates, and trusts. (a) The income 
33.15 	taxes imposed by this chapter upon married individuals filing joint returns and surviving 
33.16 	spouses as defined in section 2(a) of the Internal Revenue Code must be computed by 
33.17 	applying to their taxable net income the following schedule of rates:
33.18 	(1) On the first $25,680, 5.35 percent;
33.19 	(2) On all over $25,680, but not over $102,030, 7.05 percent;
33.20 	(3) On all over $102,030, 7.85 percent.
33.21 	Married individuals filing separate returns, estates, and trusts must compute their 
33.22 	income tax by applying the above rates to their taxable income, except that the income 
33.23 	brackets will be one-half of the above amounts.
33.24 	(b) The income taxes imposed by this chapter upon unmarried individuals must be 
33.25 	computed by applying to taxable net income the following schedule of rates:
33.26 	(1) On the first $17,570, 5.35 percent;
33.27 	(2) On all over $17,570, but not over $57,710, 7.05 percent;
33.28 	(3) On all over $57,710, 7.85 percent.
33.29 	(c) The income taxes imposed by this chapter upon unmarried individuals qualifying 
33.30 	as a head of household as defined in section 2(b) of the Internal Revenue Code must be 
33.31 	computed by applying to taxable net income the following schedule of rates:
33.32 	(1) On the first $21,630, 5.35 percent;
33.33 	(2) On all over $21,630, but not over $86,910, 7.05 percent;
33.34 	(3) On all over $86,910, 7.85 percent.
34.1 	(d) In lieu of a tax computed according to the rates set forth in this subdivision, the 
34.2 	tax of any individual taxpayer whose taxable net income for the taxable year is less than 
34.3 	an amount determined by the commissioner must be computed in accordance with tables 
34.4 	prepared and issued by the commissioner of revenue based on income brackets of not 
34.5 	more than $100. The amount of tax for each bracket shall be computed at the rates set 
34.6 	forth in this subdivision, provided that the commissioner may disregard a fractional part of 
34.7 	a dollar unless it amounts to 50 cents or more, in which case it may be increased to $1.
34.8 	(e) An individual who is not a Minnesota resident for the entire year must compute 
34.9 	the individual's Minnesota income tax as provided in this subdivision. After the 
34.10 	application of the nonrefundable credits provided in this chapter, the tax liability must 
34.11 	then be multiplied by a fraction in which:
34.12 	(1) the numerator is the individual's Minnesota source federal adjusted gross income 
34.13 	as defined in section 62 of the Internal Revenue Code and increased by the additions 
34.14 	required under section 290.01, subdivision 19a, clauses (1), (5), (6), (7), (8), (9), (12), 
34.15 	(13), and (16), and (17) to (18), and reduced by the Minnesota assignable portion of 
34.16 	the subtraction for United States government interest under section 290.01, subdivision 
34.17 	19b, clause (1), and the subtractions under section 290.01, subdivision 19b, clauses (8), 
34.18 	(9), (13), (14), (15), and (17), and (18), after applying the allocation and assignability 
34.19 	provisions of section 290.081, clause (a), or 290.17; and
34.20 	(2) the denominator is the individual's federal adjusted gross income as defined in 
34.21 	section 62 of the Internal Revenue Code of 1986, increased by the amounts specified in 
34.22 	section 290.01, subdivision 19a, clauses (1), (5), (6), (7), (8), (9), (12), (13), and (16), and 
34.23 	(17) to (18), and reduced by the amounts specified in section 290.01, subdivision 19b, 
34.24 	clauses (1), (8), (9), (13), (14), (15), and (17), and (18).

34.25 	EFFECTIVE DATE. This section is effective retroactively for losses generated in 
34.26 	taxable years beginning after December 31, 2007.

34.27 	Sec. 4. Minnesota Statutes 2010, section 290.091, subdivision 2, is amended to read:
34.28 		Subd. 2.Definitions. For purposes of the tax imposed by this section, the following 
34.29 	terms have the meanings given:
34.30 	(a) "Alternative minimum taxable income" means the sum of the following for 
34.31 	the taxable year:
34.32 	(1) the taxpayer's federal alternative minimum taxable income as defined in section 
34.33 	55(b)(2) of the Internal Revenue Code;
34.34 	(2) the taxpayer's itemized deductions allowed in computing federal alternative 
34.35 	minimum taxable income, but excluding:
35.1 	(i) the charitable contribution deduction under section 170 of the Internal Revenue 
35.2 	Code;
35.3 	(ii) the medical expense deduction;
35.4 	(iii) the casualty, theft, and disaster loss deduction; and
35.5 	(iv) the impairment-related work expenses of a disabled person;
35.6 	(3) for depletion allowances computed under section 613A(c) of the Internal 
35.7 	Revenue Code, with respect to each property (as defined in section 614 of the Internal 
35.8 	Revenue Code), to the extent not included in federal alternative minimum taxable income, 
35.9 	the excess of the deduction for depletion allowable under section 611 of the Internal 
35.10 	Revenue Code for the taxable year over the adjusted basis of the property at the end of the 
35.11 	taxable year (determined without regard to the depletion deduction for the taxable year);
35.12 	(4) to the extent not included in federal alternative minimum taxable income, the 
35.13 	amount of the tax preference for intangible drilling cost under section 57(a)(2) of the 
35.14 	Internal Revenue Code determined without regard to subparagraph (E);
35.15 	(5) to the extent not included in federal alternative minimum taxable income, the 
35.16 	amount of interest income as provided by section 290.01, subdivision 19a, clause (1); and
35.17 	(6) the amount of addition required by section 290.01, subdivision 19a, clauses (7) 
35.18 	to (9), (12), (13), and (16), and (17) to (18);
35.19 	less the sum of the amounts determined under the following:
35.20 	(1) interest income as defined in section 290.01, subdivision 19b, clause (1);
35.21 	(2) an overpayment of state income tax as provided by section 290.01, subdivision 
35.22 	19b, clause (2), to the extent included in federal alternative minimum taxable income;
35.23 	(3) the amount of investment interest paid or accrued within the taxable year on 
35.24 	indebtedness to the extent that the amount does not exceed net investment income, as 
35.25 	defined in section 163(d)(4) of the Internal Revenue Code. Interest does not include 
35.26 	amounts deducted in computing federal adjusted gross income; and
35.27 	(4) amounts subtracted from federal taxable income as provided by section 290.01, 
35.28 	subdivision 19b, clauses (6), (8) to (15), and (17); and
35.29 	(5) the amount of the net operating loss allowed under section 290.095, subdivision 
35.30 	11, paragraph (c).
35.31 	In the case of an estate or trust, alternative minimum taxable income must be 
35.32 	computed as provided in section 59(c) of the Internal Revenue Code.
35.33 	(b) "Investment interest" means investment interest as defined in section 163(d)(3) 
35.34 	of the Internal Revenue Code.
35.35 	(c) "Net minimum tax" means the minimum tax imposed by this section.
36.1 	(d) "Regular tax" means the tax that would be imposed under this chapter (without 
36.2 	regard to this section and section 290.032), reduced by the sum of the nonrefundable 
36.3 	credits allowed under this chapter.
36.4 	(e) "Tentative minimum tax" equals 6.4 percent of alternative minimum taxable 
36.5 	income after subtracting the exemption amount determined under subdivision 3.

36.6 	EFFECTIVE DATE. This section is effective retroactively for losses generated in 
36.7 	taxable years beginning after December 31, 2007.

36.8 	Sec. 5. Minnesota Statutes 2010, section 290.0922, subdivision 2, is amended to read:
36.9 		Subd. 2.Exemptions. The following entities are exempt from the tax imposed 
36.10 	by this section:
36.11 	(1) corporations exempt from tax under section 290.05;
36.12 	(2) real estate investment trusts;
36.13 	(3) regulated investment companies or a fund thereof; and
36.14 	(4) entities having a valid election in effect under section 860D(b) of the Internal 
36.15 	Revenue Code;
36.16 	(5) town and farmers' mutual insurance companies;
36.17 	(6) cooperatives organized under chapter 308A or 308B that provide housing 
36.18 	exclusively to persons age 55 and over and are classified as homesteads under section 
36.19 	273.124, subdivision 3;
36.20 	(7) an entity a qualified business as defined under section 469.310, subdivision 11, 
36.21 	if for the taxable year all of its property is located in a job opportunity building zone 
36.22 	designated under section 469.314 and all of its payroll is a job opportunity building zone 
36.23 	payroll under section 469.310; and
36.24 	(8) an entity, if for the taxable year all of its property is located in an international 
36.25 	economic development zone designated under section 469.322, and all of its payroll is 
36.26 	international economic development zone payroll under section 469.321. The exemption 
36.27 	under this clause applies to taxable years beginning during the duration of the international 
36.28 	economic development zone.
36.29 	Entities not specifically exempted by this subdivision are subject to tax under this 
36.30 	section, notwithstanding section 290.05.

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

36.32 	Sec. 6. Minnesota Statutes 2010, section 290.0922, subdivision 3, is amended to read:
37.1 		Subd. 3.Definitions. (a) "Minnesota sales or receipts" means the total sales 
37.2 	apportioned to Minnesota pursuant to section 290.191, subdivision 5, the total receipts 
37.3 	attributed to Minnesota pursuant to section 290.191, subdivisions 6 to 8, and/or the 
37.4 	total sales or receipts apportioned or attributed to Minnesota pursuant to any other 
37.5 	apportionment formula applicable to the taxpayer.
37.6 	(b) "Minnesota property" means total Minnesota tangible property as provided in 
37.7 	section 290.191, subdivisions 9 to 11, any other tangible property located in Minnesota, 
37.8 	but does not include: (1) the property of a qualified business as defined under section 
37.9 	469.310, subdivision 11, that is located in a job opportunity building zone designated 
37.10 	under section 469.314, (2) property of a qualified business located in a biotechnology and 
37.11 	health sciences industry zone designated under section 469.334, or (3) for taxable years 
37.12 	beginning during the duration of the zone, property of a qualified business located in the 
37.13 	international economic development zone designated under section 469.322. Intangible 
37.14 	property shall not be included in Minnesota property for purposes of this section. 
37.15 	Taxpayers who do not utilize tangible property to apportion income shall nevertheless 
37.16 	include Minnesota property for purposes of this section. On a return for a short taxable 
37.17 	year, the amount of Minnesota property owned, as determined under section 290.191, 
37.18 	shall be included in Minnesota property based on a fraction in which the numerator is the 
37.19 	number of days in the short taxable year and the denominator is 365.
37.20 	(c) "Minnesota payrolls" means total Minnesota payrolls as provided in section 
37.21 	290.191, subdivision 12, but does not include: (1) the job opportunity building zone 
37.22 	payrolls payroll under section 469.310, subdivision 8, of a qualified business as defined 
37.23 	under section 469.310, subdivision 11, (2) biotechnology and health sciences industry 
37.24 	zone payrolls under section 469.330, subdivision 8, or (3) for taxable years beginning 
37.25 	during the duration of the zone, international economic development zone payrolls under 
37.26 	section 469.321, subdivision 9. Taxpayers who do not utilize payrolls to apportion income 
37.27 	shall nevertheless include Minnesota payrolls for purposes of this section.

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

37.29 	Sec. 7. Minnesota Statutes 2010, section 290.095, subdivision 11, is amended to read:
37.30 		Subd. 11.Carryback or carryover adjustments. (a) Except as provided in 
37.31 	paragraph (c), for individuals, estates, and trusts the amount of a net operating loss 
37.32 	that may be carried back or carried over shall be the same dollar amount allowable in 
37.33 	the determination of federal taxable income, provided that, notwithstanding any other 
37.34 	provision, estates and trusts must apply the following adjustments to the amount of the net 
37.35 	operating loss that may be carried back or carried over:
38.1 	(1) Nonassignable income or losses as required by section 290.17.
38.2 	(2) Deductions not allocable to Minnesota under section 290.17.
38.3 	(b) The net operating loss carryback or carryover applied as a deduction in the taxable 
38.4 	year to which the net operating loss is carried back or carried over shall be equal to the 
38.5 	net operating loss carryback or carryover applied in the taxable year in arriving at federal 
38.6 	taxable income provided that trusts and estates must apply the following modifications:
38.7 	(1) Increase the amount of carryback or carryover applied in the taxable year by 
38.8 	the amount of losses and interest, taxes and other expenses not assignable or allowable 
38.9 	to Minnesota incurred in the taxable year.
38.10 	(2) Decrease the amount of carryback or carryover applied in the taxable year by 
38.11 	the amount of income not assignable to Minnesota earned in the taxable year. For estates 
38.12 	and trusts, the net operating loss carryback or carryover to the next consecutive taxable 
38.13 	year shall be the net operating loss carryback or carryover as calculated in clause (b) 
38.14 	less the amount applied in the earlier taxable year(s). No additional net operating loss 
38.15 	carryback or carryover shall be allowed to estates and trusts if the entire amount has been 
38.16 	used to offset Minnesota income in a year earlier than was possible on the federal return. 
38.17 	However, if a net operating loss carryback or carryover was allowed to offset federal 
38.18 	income in a year earlier than was possible on the Minnesota return, an estate or trust 
38.19 	shall still be allowed to offset Minnesota income but only if the loss was assignable to 
38.20 	Minnesota in the year the loss occurred.
38.21 	(c) This paragraph does not apply to eligible small businesses that make a valid 
38.22 	election to carry back their losses for federal purposes under section 172(b)(1)(H) of the 
38.23 	Internal Revenue Code as amended through March 31, 2009.
38.24 	(1) A net operating loss of an individual, estate, or trust that is allowed under this 
38.25 	subdivision and for which the taxpayer elects to carry back for more than two years under 
38.26 	section 172(b)(1)(H) of the Internal Revenue Code is a net operating loss carryback to 
38.27 	each of the two taxable years preceding the loss, and unused portions may be carried 
38.28 	forward for 20 taxable years after the loss.
38.29 	(2) The entire amount of the net operating loss for any taxable year must be carried 
38.30 	to the earliest of the taxable years to which the loss may be carried. The portion of the loss 
38.31 	which may be carried to each of the other taxable years is the excess, if any, of the amount 
38.32 	of the loss over the greater of the taxable net income or alternative minimum taxable 
38.33 	income for each of the taxable years to which the loss may be carried.

38.34 	EFFECTIVE DATE. This section is effective retroactively for losses generated in 
38.35 	taxable years beginning after December 31, 2007.

39.1 	ARTICLE 7
39.2 	DEPARTMENT TECHNICAL: PROPERTY TAX

39.3 	Section 1. Minnesota Statutes 2010, section 273.1231, subdivision 4, is amended to 
39.4 	read:
39.5 		Subd. 4.Homestead property.  "Homestead property" means a homestead dwelling 
39.6 	that is classified as class 1a, 1b, 1c, or 2a property or a manufactured home or sectional 
39.7 	home used as a homestead and taxed pursuant to section 273.125, subdivision 8, paragraph 
39.8 	(b), (c), or (d).

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

39.10 	Sec. 2. Minnesota Statutes 2010, section 273.124, subdivision 1, is amended to read:
39.11 		Subdivision 1.General rule. (a) Residential real estate that is occupied and used 
39.12 	for the purposes of a homestead by its owner, who must be a Minnesota resident, is 
39.13 	a residential homestead.
39.14 	Agricultural land, as defined in section 273.13, subdivision 23, that is occupied and 
39.15 	used as a homestead by its owner, who must be a Minnesota resident, is an agricultural 
39.16 	homestead.
39.17 	Dates for establishment of a homestead and homestead treatment provided to 
39.18 	particular types of property are as provided in this section.
39.19 	Property held by a trustee under a trust is eligible for homestead classification if the 
39.20 	requirements under this chapter are satisfied.
39.21 	The assessor shall require proof, as provided in subdivision 13, of the facts upon 
39.22 	which classification as a homestead may be determined. Notwithstanding any other law, 
39.23 	the assessor may at any time require a homestead application to be filed in order to verify 
39.24 	that any property classified as a homestead continues to be eligible for homestead status. 
39.25 	Notwithstanding any other law to the contrary, the Department of Revenue may, upon 
39.26 	request from an assessor, verify whether an individual who is requesting or receiving 
39.27 	homestead classification has filed a Minnesota income tax return as a resident for the most 
39.28 	recent taxable year for which the information is available.
39.29 	When there is a name change or a transfer of homestead property, the assessor may 
39.30 	reclassify the property in the next assessment unless a homestead application is filed to 
39.31 	verify that the property continues to qualify for homestead classification.
39.32 	(b) For purposes of this section, homestead property shall include property which 
39.33 	is used for purposes of the homestead but is separated from the homestead by a road, 
39.34 	street, lot, waterway, or other similar intervening property. The term "used for purposes 
40.1 	of the homestead" shall include but not be limited to uses for gardens, garages, or other 
40.2 	outbuildings commonly associated with a homestead, but shall not include vacant land 
40.3 	held primarily for future development. In order to receive homestead treatment for 
40.4 	the noncontiguous property, the owner must use the property for the purposes of the 
40.5 	homestead, and must apply to the assessor, both by the deadlines given in subdivision 
40.6 	9. After initial qualification for the homestead treatment, additional applications for 
40.7 	subsequent years are not required.
40.8 	(c) Residential real estate that is occupied and used for purposes of a homestead by a 
40.9 	relative of the owner is a homestead but only to the extent of the homestead treatment 
40.10 	that would be provided if the related owner occupied the property. For purposes of this 
40.11 	paragraph and paragraph (g), "relative" means a parent, stepparent, child, stepchild, 
40.12 	grandparent, grandchild, brother, sister, uncle, aunt, nephew, or niece. This relationship 
40.13 	may be by blood or marriage. Property that has been classified as seasonal residential 
40.14 	recreational property at any time during which it has been owned by the current owner or 
40.15 	spouse of the current owner will not be reclassified as a homestead unless it is occupied as 
40.16 	a homestead by the owner; this prohibition also applies to property that, in the absence of 
40.17 	this paragraph, would have been classified as seasonal residential recreational property at 
40.18 	the time when the residence was constructed. Neither the related occupant nor the owner 
40.19 	of the property may claim a property tax refund under chapter 290A for a homestead 
40.20 	occupied by a relative. In the case of a residence located on agricultural land, only the 
40.21 	house, garage, and immediately surrounding one acre of land shall be classified as a 
40.22 	homestead under this paragraph, except as provided in paragraph (d).
40.23 	(d) Agricultural property that is occupied and used for purposes of a homestead by 
40.24 	a relative of the owner, is a homestead, only to the extent of the homestead treatment 
40.25 	that would be provided if the related owner occupied the property, and only if all of the 
40.26 	following criteria are met:
40.27 	(1) the relative who is occupying the agricultural property is a son, daughter, brother, 
40.28 	sister, grandson, granddaughter, father, or mother grandchild, child, sibling, or parent of 
40.29 	the owner of the agricultural property or a son, daughter, brother, sister, grandson, or 
40.30 	granddaughter of the spouse of the owner of the agricultural property;
40.31 	(2) the owner of the agricultural property must be a Minnesota resident;
40.32 	(3) the owner of the agricultural property must not receive homestead treatment on 
40.33 	any other agricultural property in Minnesota; and
40.34 	(4) the owner of the agricultural property is limited to only one agricultural 
40.35 	homestead per family under this paragraph.
41.1 	Neither the related occupant nor the owner of the property may claim a property 
41.2 	tax refund under chapter 290A for a homestead occupied by a relative qualifying under 
41.3 	this paragraph. For purposes of this paragraph, "agricultural property" means the house, 
41.4 	garage, other farm buildings and structures, and agricultural land.
41.5 	Application must be made to the assessor by the owner of the agricultural property to 
41.6 	receive homestead benefits under this paragraph. The assessor may require the necessary 
41.7 	proof that the requirements under this paragraph have been met.
41.8 	(e) In the case of property owned by a property owner who is married, the assessor 
41.9 	must not deny homestead treatment in whole or in part if only one of the spouses occupies 
41.10 	the property and the other spouse is absent due to: (1) marriage dissolution proceedings, 
41.11 	(2) legal separation, (3) employment or self-employment in another location, or (4) other 
41.12 	personal circumstances causing the spouses to live separately, not including an intent to 
41.13 	obtain two homestead classifications for property tax purposes. To qualify under clause 
41.14 	(3), the spouse's place of employment or self-employment must be at least 50 miles distant 
41.15 	from the other spouse's place of employment, and the homesteads must be at least 50 miles 
41.16 	distant from each other. Homestead treatment, in whole or in part, shall not be denied to 
41.17 	the owner's spouse who previously occupied the residence with the owner if the absence 
41.18 	of the owner is due to one of the exceptions provided in this paragraph.
41.19 	(f) The assessor must not deny homestead treatment in whole or in part if:
41.20 	(1) in the case of a property owner who is not married, the owner is absent due to 
41.21 	residence in a nursing home, boarding care facility, or an elderly assisted living facility 
41.22 	property as defined in section 273.13, subdivision 25a, and the property is not otherwise 
41.23 	occupied; or
41.24 	(2) in the case of a property owner who is married, the owner or the owner's spouse 
41.25 	or both are absent due to residence in a nursing home, boarding care facility, or an elderly 
41.26 	assisted living facility property as defined in section 273.13, subdivision 25a, and the 
41.27 	property is not occupied or is occupied only by the owner's spouse.
41.28 	(g) If an individual is purchasing property with the intent of claiming it as a 
41.29 	homestead and is required by the terms of the financing agreement to have a relative 
41.30 	shown on the deed as a co-owner, the assessor shall allow a full homestead classification. 
41.31 	This provision only applies to first-time purchasers, whether married or single, or to a 
41.32 	person who had previously been married and is purchasing as a single individual for the 
41.33 	first time. The application for homestead benefits must be on a form prescribed by the 
41.34 	commissioner and must contain the data necessary for the assessor to determine if full 
41.35 	homestead benefits are warranted.
42.1 	(h) If residential or agricultural real estate is occupied and used for purposes of a 
42.2 	homestead by a child of a deceased owner and the property is subject to jurisdiction of 
42.3 	probate court, the child shall receive relative homestead classification under paragraph (c) 
42.4 	or (d) to the same extent they would be entitled to it if the owner was still living, until 
42.5 	the probate is completed. For purposes of this paragraph, "child" includes a relationship 
42.6 	by blood or by marriage.
42.7 	(i) If a single-family home, duplex, or triplex classified as either residential 
42.8 	homestead or agricultural homestead is also used to provide licensed child care, the 
42.9 	portion of the property used for licensed child care must be classified as a part of the 
42.10 	homestead property.

42.11 	EFFECTIVE DATE. This section is effective for taxes payable in 2012 and 
42.12 	thereafter.

42.13 	Sec. 3. Minnesota Statutes 2010, section 273.124, subdivision 14, is amended to read:
42.14 		Subd. 14.Agricultural homesteads; special provisions.  (a) Real estate of less than 
42.15 	ten acres that is the homestead of its owner must be classified as class 2a under section 
42.16 	273.13, subdivision 23, paragraph (a), if:
42.17 	(1) the parcel on which the house is located is contiguous on at least two sides to (i) 
42.18 	agricultural land, (ii) land owned or administered by the United States Fish and Wildlife 
42.19 	Service, or (iii) land administered by the Department of Natural Resources on which in 
42.20 	lieu taxes are paid under sections 477A.11 to 477A.14;
42.21 	(2) its owner also owns a noncontiguous parcel of agricultural land that is at least 
42.22 	20 acres;
42.23 	(3) the noncontiguous land is located not farther than four townships or cities, or a 
42.24 	combination of townships or cities from the homestead; and
42.25 	(4) the agricultural use value of the noncontiguous land and farm buildings is equal 
42.26 	to at least 50 percent of the market value of the house, garage, and one acre of land.
42.27 	Homesteads initially classified as class 2a under the provisions of this paragraph shall 
42.28 	remain classified as class 2a, irrespective of subsequent changes in the use of adjoining 
42.29 	properties, as long as the homestead remains under the same ownership, the owner owns a 
42.30 	noncontiguous parcel of agricultural land that is at least 20 acres, and the agricultural use 
42.31 	value qualifies under clause (4). Homestead classification under this paragraph is limited 
42.32 	to property that qualified under this paragraph for the 1998 assessment.
42.33 	(b)(i) Agricultural property shall be classified as the owner's homestead, to the same 
42.34 	extent as other agricultural homestead property, if all of the following criteria are met:
43.1 	(1) the agricultural property consists of at least 40 acres including undivided 
43.2 	government lots and correctional 40's;
43.3 	(2) the owner, the owner's spouse, the son or daughter of the owner or owner's 
43.4 	spouse, the brother or sister of the owner or owner's spouse, or the grandson or 
43.5 	granddaughter or a grandchild, child, sibling, or parent of the owner or of the owner's 
43.6 	spouse, is actively farming the agricultural property, either on the person's own behalf 
43.7 	as an individual or on behalf of a partnership operating a family farm, family farm 
43.8 	corporation, joint family farm venture, or limited liability company of which the person is 
43.9 	a partner, shareholder, or member;
43.10 	(3) both the owner of the agricultural property and the person who is actively 
43.11 	farming the agricultural property under clause (2), are Minnesota residents;
43.12 	(4) neither the owner nor the spouse of the owner claims another agricultural 
43.13 	homestead in Minnesota; and
43.14 	(5) neither the owner nor the person actively farming the agricultural property lives 
43.15 	farther than four townships or cities, or a combination of four townships or cities, from the 
43.16 	agricultural property, except that if the owner or the owner's spouse is required to live in 
43.17 	employer-provided housing, the owner or owner's spouse, whichever is actively farming 
43.18 	the agricultural property, may live more than four townships or cities, or combination of 
43.19 	four townships or cities from the agricultural property.
43.20 	The relationship under this paragraph may be either by blood or marriage.
43.21 	(ii) Real Agricultural property held by a trustee under a trust is eligible for 
43.22 	agricultural homestead classification under this paragraph if the qualifications in clause (i) 
43.23 	are met, except that "owner" means the grantor of the trust.
43.24 	(iii) Property containing the residence of an owner who owns qualified property 
43.25 	under clause (i) shall be classified as part of the owner's agricultural homestead, if that 
43.26 	property is also used for noncommercial storage or drying of agricultural crops.
43.27 	(iv) As used in this paragraph, "agricultural property" means class 2a property and 
43.28 	any class 2b property that is contiguous to and under the same ownership as the class 2a 
43.29 	property.
43.30 	(c) Noncontiguous land shall be included as part of a homestead under section 
43.31 	273.13, subdivision 23, paragraph (a), only if the homestead is classified as class 2a 
43.32 	and the detached land is located in the same township or city, or not farther than four 
43.33 	townships or cities or combination thereof from the homestead. Any taxpayer of these 
43.34 	noncontiguous lands must notify the county assessor that the noncontiguous land is part of 
43.35 	the taxpayer's homestead, and, if the homestead is located in another county, the taxpayer 
43.36 	must also notify the assessor of the other county.
44.1 	(d) Agricultural land used for purposes of a homestead and actively farmed by a 
44.2 	person holding a vested remainder interest in it must be classified as a homestead under 
44.3 	section 273.13, subdivision 23, paragraph (a). If agricultural land is classified class 2a, 
44.4 	any other dwellings on the land used for purposes of a homestead by persons holding 
44.5 	vested remainder interests who are actively engaged in farming the property, and up to 
44.6 	one acre of the land surrounding each homestead and reasonably necessary for the use of 
44.7 	the dwelling as a home, must also be assessed class 2a.
44.8 	(e) Agricultural land and buildings that were class 2a homestead property under 
44.9 	section 273.13, subdivision 23, paragraph (a), for the 1997 assessment shall remain 
44.10 	classified as agricultural homesteads for subsequent assessments if:
44.11 	(1) the property owner abandoned the homestead dwelling located on the agricultural 
44.12 	homestead as a result of the April 1997 floods;
44.13 	(2) the property is located in the county of Polk, Clay, Kittson, Marshall, Norman, 
44.14 	or Wilkin;
44.15 	(3) the agricultural land and buildings remain under the same ownership for the 
44.16 	current assessment year as existed for the 1997 assessment year and continue to be used 
44.17 	for agricultural purposes;
44.18 	(4) the dwelling occupied by the owner is located in Minnesota and is within 30 
44.19 	miles of one of the parcels of agricultural land that is owned by the taxpayer; and
44.20 	(5) the owner notifies the county assessor that the relocation was due to the 1997 
44.21 	floods, and the owner furnishes the assessor any information deemed necessary by the 
44.22 	assessor in verifying the change in dwelling. Further notifications to the assessor are not 
44.23 	required if the property continues to meet all the requirements in this paragraph and any 
44.24 	dwellings on the agricultural land remain uninhabited.
44.25 	(f) Agricultural land and buildings that were class 2a homestead property under 
44.26 	section 273.13, subdivision 23, paragraph (a), for the 1998 assessment shall remain 
44.27 	classified agricultural homesteads for subsequent assessments if:
44.28 	(1) the property owner abandoned the homestead dwelling located on the agricultural 
44.29 	homestead as a result of damage caused by a March 29, 1998, tornado;
44.30 	(2) the property is located in the county of Blue Earth, Brown, Cottonwood, 
44.31 	LeSueur, Nicollet, Nobles, or Rice;
44.32 	(3) the agricultural land and buildings remain under the same ownership for the 
44.33 	current assessment year as existed for the 1998 assessment year;
44.34 	(4) the dwelling occupied by the owner is located in this state and is within 50 miles 
44.35 	of one of the parcels of agricultural land that is owned by the taxpayer; and
45.1 	(5) the owner notifies the county assessor that the relocation was due to a March 29, 
45.2 	1998, tornado, and the owner furnishes the assessor any information deemed necessary by 
45.3 	the assessor in verifying the change in homestead dwelling. For taxes payable in 1999, the 
45.4 	owner must notify the assessor by December 1, 1998. Further notifications to the assessor 
45.5 	are not required if the property continues to meet all the requirements in this paragraph 
45.6 	and any dwellings on the agricultural land remain uninhabited.
45.7 	(g) Agricultural property of a family farm corporation, joint family farm venture, 
45.8 	family farm limited liability company, or partnership operating a family farm as described 
45.9 	under subdivision 8 shall be classified homestead, to the same extent as other agricultural 
45.10 	homestead property, if all of the following criteria are met:
45.11 	(1) the property consists of at least 40 acres including undivided government lots 
45.12 	and correctional 40's;
45.13 	(2) a shareholder, member, or partner of that entity is actively farming the 
45.14 	agricultural property;
45.15 	(3) that shareholder, member, or partner who is actively farming the agricultural 
45.16 	property is a Minnesota resident;
45.17 	(4) neither that shareholder, member, or partner, nor the spouse of that shareholder, 
45.18 	member, or partner claims another agricultural homestead in Minnesota; and
45.19 	(5) that shareholder, member, or partner does not live farther than four townships or 
45.20 	cities, or a combination of four townships or cities, from the agricultural property.
45.21 	Homestead treatment applies under this paragraph for property leased to a family 
45.22 	farm corporation, joint farm venture, limited liability company, or partnership operating a 
45.23 	family farm if legal title to the property is in the name of an individual who is a member, 
45.24 	shareholder, or partner in the entity.
45.25 	(h) To be eligible for the special agricultural homestead under this subdivision, an 
45.26 	initial full application must be submitted to the county assessor where the property is 
45.27 	located. Owners and the persons who are actively farming the property shall be required 
45.28 	to complete only a one-page abbreviated version of the application in each subsequent 
45.29 	year provided that none of the following items have changed since the initial application:
45.30 	(1) the day-to-day operation, administration, and financial risks remain the same;
45.31 	(2) the owners and the persons actively farming the property continue to live within 
45.32 	the four townships or city criteria and are Minnesota residents;
45.33 	(3) the same operator of the agricultural property is listed with the Farm Service 
45.34 	Agency;
45.35 	(4) a Schedule F or equivalent income tax form was filed for the most recent year;
45.36 	(5) the property's acreage is unchanged; and
46.1 	(6) none of the property's acres have been enrolled in a federal or state farm program 
46.2 	since the initial application.
46.3 	The owners and any persons who are actively farming the property must include 
46.4 	the appropriate Social Security numbers, and sign and date the application. If any of the 
46.5 	specified information has changed since the full application was filed, the owner must 
46.6 	notify the assessor, and must complete a new application to determine if the property 
46.7 	continues to qualify for the special agricultural homestead. The commissioner of revenue 
46.8 	shall prepare a standard reapplication form for use by the assessors.
46.9 	(i) Agricultural land and buildings that were class 2a homestead property under 
46.10 	section 273.13, subdivision 23, paragraph (a), for the 2007 assessment shall remain 
46.11 	classified agricultural homesteads for subsequent assessments if:
46.12 	(1) the property owner abandoned the homestead dwelling located on the agricultural 
46.13 	homestead as a result of damage caused by the August 2007 floods;
46.14 	(2) the property is located in the county of Dodge, Fillmore, Houston, Olmsted, 
46.15 	Steele, Wabasha, or Winona;
46.16 	(3) the agricultural land and buildings remain under the same ownership for the 
46.17 	current assessment year as existed for the 2007 assessment year;
46.18 	(4) the dwelling occupied by the owner is located in this state and is within 50 miles 
46.19 	of one of the parcels of agricultural land that is owned by the taxpayer; and
46.20 	(5) the owner notifies the county assessor that the relocation was due to the August 
46.21 	2007 floods, and the owner furnishes the assessor any information deemed necessary by 
46.22 	the assessor in verifying the change in homestead dwelling. For taxes payable in 2009, the 
46.23 	owner must notify the assessor by December 1, 2008. Further notifications to the assessor 
46.24 	are not required if the property continues to meet all the requirements in this paragraph 
46.25 	and any dwellings on the agricultural land remain uninhabited.
46.26 	(j) Agricultural land and buildings that were class 2a homestead property under 
46.27 	section 273.13, subdivision 23, paragraph (a), for the 2008 assessment shall remain 
46.28 	classified as agricultural homesteads for subsequent assessments taxes payable in 2011 
46.29 	and 2012 if:
46.30 	(1) the property owner abandoned the homestead dwelling located on the agricultural 
46.31 	homestead as a result of the March 2009 floods;
46.32 	(2) the property is located in the county of Marshall;
46.33 	(3) the agricultural land and buildings remain under the same ownership for the 
46.34 	current assessment year as existed for the 2008 assessment year and continue to be used 
46.35 	for agricultural purposes;
47.1 	(4) the dwelling occupied by the owner is located in Minnesota and is within 50 
47.2 	miles of one of the parcels of agricultural land that is owned by the taxpayer; and
47.3 	(5) the owner notifies the county assessor that the relocation was due to the 2009 
47.4 	floods, and the owner furnishes the assessor any information deemed necessary by the 
47.5 	assessor in verifying the change in dwelling. Further notifications to the assessor are not 
47.6 	required if the property continues to meet all the requirements in this paragraph and any 
47.7 	dwellings on the agricultural land remain uninhabited.

47.8 	EFFECTIVE DATE. This section is effective the day following final enactment 
47.9 	except that the change in paragraph (b), clause (i), item (2), is effective for taxes payable 
47.10 	in 2012 and thereafter.

47.11 	Sec. 4. Minnesota Statutes 2010, section 282.01, subdivision 1a, is amended to read:
47.12 		Subd. 1a.Conveyance to public entities. (a) Upon written request from a state 
47.13 	agency or a governmental subdivision of the state, a parcel of unsold tax-forfeited land 
47.14 	must be withheld from sale or lease to others for a maximum of six months. The request 
47.15 	must be submitted to the county auditor. Upon receipt, the county auditor must withhold 
47.16 	the parcel from sale or lease to any other party for six months, and must confirm the 
47.17 	starting date of the six-month withholding period to the requesting agency or subdivision. 
47.18 	If the request is from a governmental subdivision of the state, the governmental 
47.19 	subdivision must pay the maintenance costs incurred by the county during the period the 
47.20 	parcel is withheld. The county board may approve a sale or conveyance to the requesting 
47.21 	party during the withholding period. A conveyance of the property to the requesting 
47.22 	party terminates the withholding period.
47.23 	A governmental subdivision of the state must not make, and a county auditor must 
47.24 	not act upon, a second request to withhold a parcel from sale or lease within 18 months 
47.25 	of a previous request for that parcel. A county may reject a request made under this 
47.26 	paragraph if the request is made more than 30 days after the county has given notice to the 
47.27 	requesting state agency or governmental subdivision of the state that the county intends to 
47.28 	sell or otherwise dispose of the property.
47.29 	(b) Nonconservation tax-forfeited lands may be sold by the county board, for 
47.30 	their market value as determined by the county board, to an organized or incorporated 
47.31 	governmental subdivision of the state for any public purpose for which the subdivision is 
47.32 	authorized to acquire property. When the term "market value" is used in this section, it 
47.33 	means an estimate of the full and actual market value of the parcel as determined by the 
47.34 	county board, but in making this determination, the board and the persons employed by or 
48.1 	under contract with the board in order to perform, conduct, or assist in the determination, 
48.2 	are exempt from the licensure requirements of chapter 82B.
48.3 	(c) Nonconservation tax-forfeited lands may be released from the trust in favor of 
48.4 	the taxing districts on application to the county board by a state agency for an authorized 
48.5 	use at not less than their market value as determined by the county board.
48.6 	(d) Nonconservation tax-forfeited lands may be sold by the county board to an 
48.7 	organized or incorporated governmental subdivision of the state or state agency for less 
48.8 	than their market value if:
48.9 	(1) the county board determines that a sale at a reduced price is in the public interest 
48.10 	because a reduced price is necessary to provide an incentive to correct the blighted 
48.11 	conditions that make the lands undesirable in the open market, or the reduced price will 
48.12 	lead to the development of affordable housing; and
48.13 	(2) the governmental subdivision or state agency has documented its specific plans 
48.14 	for correcting the blighted conditions or developing affordable housing, and the specific 
48.15 	law or laws that empower it to acquire real property in furtherance of the plans.
48.16 	If the sale under this paragraph is to a governmental subdivision of the state, the 
48.17 	commissioner of revenue must convey the property on behalf of the state by quit claim 
48.18 	deed. If the sale under this paragraph is to a state agency, the commissioner must issue a 
48.19 	conveyance document that releases the property from the trust in favor of the taxing 
48.20 	districts.
48.21 	(e) Nonconservation tax-forfeited land held in trust in favor of the taxing districts 
48.22 	may be conveyed by the commissioner of revenue in the name of the state to a 
48.23 	governmental subdivision for an authorized public use, if an application is submitted to the 
48.24 	commissioner which includes a statement of facts as to the use to be made of the tract and 
48.25 	the favorable recommendation of the county board. For the purposes of this paragraph, 
48.26 	"authorized public use" means a use that allows an indefinite segment of the public to 
48.27 	physically use and enjoy the property in numbers appropriate to its size and use, or is for a 
48.28 	public service facility. Authorized public uses as defined in this paragraph are limited to:
48.29 	(1) a road, or right-of-way for a road;
48.30 	(2) a park that is both available to, and accessible by, the public that contains 
48.31 	amenities improvements such as campgrounds, playgrounds, athletic fields, trails, or 
48.32 	shelters;
48.33 	(3) trails for walking, bicycling, snowmobiling, or other recreational purposes, along 
48.34 	with a reasonable amount of surrounding land maintained in its natural state;
49.1 	(4) transit facilities for buses, light rail transit, commuter rail or passenger rail, 
49.2 	including transit ways, park-and-ride lots, transit stations, maintenance and garage 
49.3 	facilities, and other facilities related to a public transit system;
49.4 	(5) public beaches or boat launches;
49.5 	(6) public parking;
49.6 	(7) civic recreation or conference facilities; and
49.7 	(8) public service facilities such as fire halls, police stations, lift stations, water 
49.8 	towers, sanitation facilities, water treatment facilities, and administrative offices.
49.9 	No monetary compensation or consideration is required for the conveyance, except as 
49.10 	provided in subdivision 1g, but the conveyance is subject to the conditions provided in 
49.11 	law, including, but not limited to, the reversion provisions of subdivisions 1c and 1d.
49.12 	(f) The commissioner of revenue shall convey a parcel of nonconservation 
49.13 	tax-forfeited land to a local governmental subdivision of the state by quit claim deed 
49.14 	on behalf of the state upon the favorable recommendation of the county board if the 
49.15 	governmental subdivision has certified to the board that prior to forfeiture the subdivision 
49.16 	was entitled to the parcel under a written development agreement or instrument, but 
49.17 	the conveyance failed to occur prior to forfeiture. No compensation or consideration is 
49.18 	required for, and no conditions attach to, the conveyance.
49.19 	(g) The commissioner of revenue shall convey a parcel of nonconservation 
49.20 	tax-forfeited land to the association of a common interest community by quit claim deed 
49.21 	upon the favorable recommendation of the county board if the association certifies to the 
49.22 	board that prior to forfeiture the association was entitled to the parcel under a written 
49.23 	agreement, but the conveyance failed to occur prior to forfeiture. No compensation or 
49.24 	consideration is required for, and no conditions attach to, the conveyance.
49.25 	(h) Conservation tax-forfeited land may be sold to a governmental subdivision of 
49.26 	the state for less than its market value for either: (1) creation or preservation of wetlands; 
49.27 	(2) drainage or storage of storm water under a storm water management plan; or (3) 
49.28 	preservation, or restoration and preservation, of the land in its natural state. The deed must 
49.29 	contain a restrictive covenant limiting the use of the land to one of these purposes for 
49.30 	30 years or until the property is reconveyed back to the state in trust. At any time, the 
49.31 	governmental subdivision may reconvey the property to the state in trust for the taxing 
49.32 	districts. The deed of reconveyance is subject to approval by the commissioner of revenue. 
49.33 	No part of a purchase price determined under this paragraph shall be refunded upon a 
49.34 	reconveyance, but the amount paid for a conveyance under this paragraph may be taken 
49.35 	into account by the county board when setting the terms of a future sale of the same 
49.36 	property to the same governmental subdivision under paragraph (b) or (d). If the lands 
50.1 	are unplatted and located outside of an incorporated municipality and the commissioner 
50.2 	of natural resources determines there is a mineral use potential, the sale is subject to the 
50.3 	approval of the commissioner of natural resources.
50.4 	(i) A park and recreation board in a city of the first class is a governmental 
50.5 	subdivision for the purposes of this section.

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

50.7 	Sec. 5. Minnesota Statutes 2010, section 282.01, subdivision 1c, is amended to read:
50.8 		Subd. 1c.Deed of conveyance; form; approvals. The deed of conveyance for
50.9 	conveying property conveyed for an authorized public use under the authorities in 
50.10 	subdivision 1a, paragraph (e) this section, must be on a form approved by the attorney 
50.11 	general and must be conditioned on continued use of the property for the purpose stated in 
50.12 	the application as provided in this section. TheseAll deeds conveying property for an 
50.13 	authorized public use, regardless of when executed, are conditional use deeds that convey 
50.14 	a defeasible estate. Reversion of the estate occurs by operation of law and without the 
50.15 	requirement for any affirmative act by or on behalf of the state when there is a failure to 
50.16 	put the property to the approved authorized public use for which it was conveyed, or an 
50.17 	abandonment of that use, except as provided in subdivision 1d.

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

50.19 	Sec. 6. Minnesota Statutes 2010, section 282.01, subdivision 1d, is amended to read:
50.20 		Subd. 1d.Reverter for failure to use; conveyance to state. (a) If After three years 
50.21 	from the date of the any conveyance of tax-forfeited land to a governmental subdivision 
50.22 	to which tax-forfeited land has been conveyed for an authorized public use as provided 
50.23 	in subdivision 1a, paragraph (e), fails this section, regardless of when the deed for the 
50.24 	authorized public use was executed, if the governmental subdivision has failed to put the 
50.25 	land to that use, or abandons that use, the governing body of the subdivision must: (1) 
50.26 	with the approval of the county board, purchase the property for an authorized public 
50.27 	purpose at the present market value as determined by the county board, or (2) authorize 
50.28 	the proper officers to convey the land, or the part of the land not required for an authorized 
50.29 	public use, to the state of Minnesota in trust for the taxing districts. If the governing 
50.30 	body purchases the property under clause (1), the commissioner of revenue shall, upon 
50.31 	proper application submitted by the county auditor, convey the property on behalf of the 
50.32 	state by quit claim deed to the subdivision free of a use restriction and the possibility of 
50.33 	reversion or defeasement. If the governing body decides to reconvey the property to the 
51.1 	state under this clause, the officers shall execute a deed of conveyance immediately. The 
51.2 	conveyance is subject to the approval of the commissioner and its form must be approved 
51.3 	by the attorney general. For the purposes of this paragraph 15 years from the date of 
51.4 	the conveyance, there is no failure to put the land to the authorized public use and no 
51.5 	abandonment of that use if a formal plan of the governmental subdivision, including, but 
51.6 	not limited to, a comprehensive plan or land use plan that, shows an intended future use 
51.7 	of the land for the authorized public use.
51.8 	(b) Property held by a governmental subdivision of the state under a conditional use 
51.9 	deed executed under subdivision 1a, paragraph (e), this section by the commissioner of 
51.10 	revenue on or after January 1, 2007, may be acquired by that governmental subdivision 
51.11 	after 15 years from the date of the conveyance if the commissioner determines upon 
51.12 	written application from the subdivision that the subdivision has in fact put the property 
51.13 	to the authorized public use for which it was conveyed, and the subdivision has made a 
51.14 	finding that it has no current plans to change the use of the lands. Prior to conveying the 
51.15 	property, the commissioner shall inquire whether the county board where the land is 
51.16 	located objects to a conveyance of the property to the subdivision without conditions and 
51.17 	without further act by or obligation of the subdivision. If the county does not object within 
51.18 	60 days, and the commissioner makes a favorable determination, the commissioner shall 
51.19 	issue a quit claim deed on behalf of the state unconditionally conveying the property to the 
51.20 	governmental subdivision. For purposes of this paragraph, demonstration of an intended 
51.21 	future use for the authorized public use in a formal plan of the governmental subdivision 
51.22 	does not constitute use for that authorized public use.
51.23 	(c) Property held by a governmental subdivision of the state under a conditional use 
51.24 	deed executed under subdivision 1a, paragraph (e), this section by the commissioner of 
51.25 	revenue before January 1, 2007, is released from the use restriction and possibility of 
51.26 	reversion on January 1, 2022, if the county board records a resolution describing the 
51.27 	land and citing this paragraph. The county board may authorize the county treasurer 
51.28 	to deduct the amount of the recording fees from future settlements of property taxes 
51.29 	to the subdivision.
51.30 	(d) All Property conveyed under a conditional use deed executed under subdivision 
51.31 	1a, paragraph (e), this section by the commissioner of revenue, regardless of when the 
51.32 	deed for the authorized public use was executed, is released from the use restriction and 
51.33 	reverter, and any use restriction or reverter for which no declaration of reversion has been 
51.34 	recorded with the county recorder or registrar of titles, as appropriate, is nullified on the 
51.35 	later of: (1) January 1, 2015; (2) 30 years from the date the deed was acknowledged; or 
51.36 	(3) final resolution of an appeal to district court under subdivision 1e, if a lis pendens 
52.1 	related to the appeal is recorded in the office of the county recorder or registrar of titles, 
52.2 	as appropriate, prior to January 1, 2015.

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

52.4 	Sec. 7. Minnesota Statutes 2010, section 282.014, is amended to read:
52.5 	282.014 COMPLETION OF SALE, FEE, CONVEYANCE RECORDED.
52.6 	(a) Upon compliance by the purchaser with the provisions of this chapter and with 
52.7 	the terms and conditions of the sale, and upon full payment for the land, plus a $25 fee 
52.8 	in addition to the sale price, the sale shall be complete and a conveyance of the land 
52.9 	shall be issued to the purchaser as provided by the appropriate statutes according to the 
52.10 	status of the land upon forfeiture.
52.11 	The conveyance must be forwarded to the county auditor who shall have the 
52.12 	conveyance recorded before issuing it to the purchaser.
52.13 	(b) In order for the commissioner of revenue to issue a conveyance of tax-forfeited 
52.14 	land under any provision of this chapter other than section 282.01, subdivision 1a, 
52.15 	paragraph (e), or 282.33, and that is not covered by paragraph (a), the grantee must pay 
52.16 	the fee provided in paragraph (a).
52.17 	The conveyance must be forwarded to the county auditor who shall have the 
52.18 	conveyance recorded before issuing it to the grantee.

52.19 	EFFECTIVE DATE. This section is effective for deeds executed by the 
52.20 	commissioner of revenue after June 30, 2011.

52.21 	Sec. 8. Minnesota Statutes 2010, section 282.12, is amended to read:
52.22 	282.12 ALL MINERALS RESERVED.
52.23 	Any sale of suchconveyance of forfeited lands shall be subject to exceptions and 
52.24 	reservations in this state, in trust for the taxing districts of all minerals and mineral rights.

52.25 	EFFECTIVE DATE. This section is effective retroactively from July 1, 2010.

52.26 	Sec. 9.  REPEALER.
 52.27 	Minnesota Statutes 2010, sections 272.02, subdivision 34; 273.124, subdivision 10; 
52.28 	and 281.37, are repealed.

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

53.1 	ARTICLE 8
53.2 	DEPARTMENT TECHNICAL: SALES AND USE TAX

53.3 	Section 1. Minnesota Statutes 2010, section 297A.61, subdivision 3, is amended to 
53.4 	read:
53.5 		Subd. 3.Sale and purchase. (a) "Sale" and "purchase" include, but are not limited 
53.6 	to, each of the transactions listed in this subdivision.
53.7 	(b) Sale and purchase include:
53.8 	(1) any transfer of title or possession, or both, of tangible personal property, whether 
53.9 	absolutely or conditionally, for a consideration in money or by exchange or barter; and
53.10 	(2) the leasing of or the granting of a license to use or consume, for a consideration 
53.11 	in money or by exchange or barter, tangible personal property, other than a manufactured 
53.12 	home used for residential purposes for a continuous period of 30 days or more.
53.13 	(c) Sale and purchase include the production, fabrication, printing, or processing of 
53.14 	tangible personal property for a consideration for consumers who furnish either directly or 
53.15 	indirectly the materials used in the production, fabrication, printing, or processing.
53.16 	(d) Sale and purchase include the preparing for a consideration of food. 
53.17 	Notwithstanding section 297A.67, subdivision 2, taxable food includes, but is not limited 
53.18 	to, the following:
53.19 	(1) prepared food sold by the retailer;
53.20 	(2) soft drinks;
53.21 	(3) candy;
53.22 	(4) dietary supplements; and
53.23 	(5) all food sold through vending machines.
53.24 	(e) A sale and a purchase includes the furnishing for a consideration of electricity, 
53.25 	gas, water, or steam for use or consumption within this state.
53.26 	(f) A sale and a purchase includes the transfer for a consideration of prewritten 
53.27 	computer software whether delivered electronically, by load and leave, or otherwise.
53.28 	(g) A sale and a purchase includes the furnishing for a consideration of the following 
53.29 	services:
53.30 	(1) the privilege of admission to places of amusement, recreational areas, or athletic 
53.31 	events, and the making available of amusement devices, tanning facilities, reducing 
53.32 	salons, steam baths, Turkish baths, health clubs, and spas or athletic facilities;
53.33 	(2) lodging and related services by a hotel, rooming house, resort, campground, 
53.34 	motel, or trailer camp, including furnishing the guest of the facility with access to 
53.35 	telecommunication services, and the granting of any similar license to use real property 
54.1 	in a specific facility, other than the renting or leasing of it for a continuous period of 
54.2 	30 days or more under an enforceable written agreement that may not be terminated 
54.3 	without prior notice;
54.4 	(3) nonresidential parking services, whether on a contractual, hourly, or other 
54.5 	periodic basis, except for parking at a meter;
54.6 	(4) the granting of membership in a club, association, or other organization if:
54.7 	(i) the club, association, or other organization makes available for the use of its 
54.8 	members sports and athletic facilities, without regard to whether a separate charge is 
54.9 	assessed for use of the facilities; and
54.10 	(ii) use of the sports and athletic facility is not made available to the general public 
54.11 	on the same basis as it is made available to members.
54.12 	Granting of membership means both onetime initiation fees and periodic membership 
54.13 	dues. Sports and athletic facilities include golf courses; tennis, racquetball, handball, and 
54.14 	squash courts; basketball and volleyball facilities; running tracks; exercise equipment; 
54.15 	swimming pools; and other similar athletic or sports facilities;
54.16 	(5) delivery of aggregate materials by a third party, excluding delivery of aggregate 
54.17 	material used in road construction,; and delivery of concrete block by a third party if 
54.18 	the delivery would be subject to the sales tax if provided by the seller of the concrete 
54.19 	block; and
54.20 	(6) services as provided in this clause:
54.21 	(i) laundry and dry cleaning services including cleaning, pressing, repairing, altering, 
54.22 	and storing clothes, linen services and supply, cleaning and blocking hats, and carpet, 
54.23 	drapery, upholstery, and industrial cleaning. Laundry and dry cleaning services do not 
54.24 	include services provided by coin operated facilities operated by the customer;
54.25 	(ii) motor vehicle washing, waxing, and cleaning services, including services 
54.26 	provided by coin operated facilities operated by the customer, and rustproofing, 
54.27 	undercoating, and towing of motor vehicles;
54.28 	(iii) building and residential cleaning, maintenance, and disinfecting services and 
54.29 	pest control and exterminating services;
54.30 	(iv) detective, security, burglar, fire alarm, and armored car services; but not 
54.31 	including services performed within the jurisdiction they serve by off-duty licensed peace 
54.32 	officers as defined in section 626.84, subdivision 1, or services provided by a nonprofit 
54.33 	organization for monitoring and electronic surveillance of persons placed on in-home 
54.34 	detention pursuant to court order or under the direction of the Minnesota Department 
54.35 	of Corrections;
54.36 	(v) pet grooming services;
55.1 	(vi) lawn care, fertilizing, mowing, spraying and sprigging services; garden planting 
55.2 	and maintenance; tree, bush, and shrub pruning, bracing, spraying, and surgery; indoor 
55.3 	plant care; tree, bush, shrub, and stump removal, except when performed as part of a land 
55.4 	clearing contract as defined in section 297A.68, subdivision 40; and tree trimming for 
55.5 	public utility lines. Services performed under a construction contract for the installation of 
55.6 	shrubbery, plants, sod, trees, bushes, and similar items are not taxable;
55.7 	(vii) massages, except when provided by a licensed health care facility or 
55.8 	professional or upon written referral from a licensed health care facility or professional for 
55.9 	treatment of illness, injury, or disease; and
55.10 	(viii) the furnishing of lodging, board, and care services for animals in kennels and 
55.11 	other similar arrangements, but excluding veterinary and horse boarding services.
55.12 	In applying the provisions of this chapter, the terms "tangible personal property" 
55.13 	and "retail sale" include taxable services listed in clause (6), items (i) to (vi) and (viii), 
55.14 	and the provision of these taxable services, unless specifically provided otherwise. 
55.15 	Services performed by an employee for an employer are not taxable. Services performed 
55.16 	by a partnership or association for another partnership or association are not taxable if 
55.17 	one of the entities owns or controls more than 80 percent of the voting power of the 
55.18 	equity interest in the other entity. Services performed between members of an affiliated 
55.19 	group of corporations are not taxable. For purposes of the preceding sentence, "affiliated 
55.20 	group of corporations" means those entities that would be classified as members of an 
55.21 	affiliated group as defined under United States Code, title 26, section 1504, disregarding 
55.22 	the exclusions in section 1504(b).
55.23 	For purposes of clause (5), "road construction" means construction of (1) public 
55.24 	roads, (2) cartways, and (3) private roads in townships located outside of the seven-county 
55.25 	metropolitan area up to the point of the emergency response location sign.
55.26 	(h) A sale and a purchase includes the furnishing for a consideration of tangible 
55.27 	personal property or taxable services by the United States or any of its agencies or 
55.28 	instrumentalities, or the state of Minnesota, its agencies, instrumentalities, or political 
55.29 	subdivisions.
55.30 	(i) A sale and a purchase includes the furnishing for a consideration of 
55.31 	telecommunications services, ancillary services associated with telecommunication 
55.32 	services, cable television services, direct satellite services, and ring tones. 
55.33 	Telecommunication services include, but are not limited to, the following services, 
55.34 	as defined in section 297A.669: air-to-ground radiotelephone service, mobile 
55.35 	telecommunication service, postpaid calling service, prepaid calling service, prepaid 
56.1 	wireless calling service, and private communication services. The services in this 
56.2 	paragraph are taxed to the extent allowed under federal law.
56.3 	(j) A sale and a purchase includes the furnishing for a consideration of installation if 
56.4 	the installation charges would be subject to the sales tax if the installation were provided 
56.5 	by the seller of the item being installed.
56.6 	(k) A sale and a purchase includes the rental of a vehicle by a motor vehicle dealer 
56.7 	to a customer when (1) the vehicle is rented by the customer for a consideration, or (2) 
56.8 	the motor vehicle dealer is reimbursed pursuant to a service contract as defined in section 
56.9 	59B.02, subdivision 11.

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

56.11 	Sec. 2. Minnesota Statutes 2010, section 297A.71, subdivision 23, is amended to read:
56.12 		Subd. 23.Construction materials for qualified low-income housing projects. (a) 
56.13 	Purchases of materials and supplies used or consumed in and equipment incorporated into 
56.14 	the construction, improvement, or expansion of qualified low-income housing projects are 
56.15 	exempt from the tax imposed under this chapter if the owner of the qualified low-income 
56.16 	housing project is:
56.17 	(1) the public housing agency or housing and redevelopment authority of a political 
56.18 	subdivision;
56.19 	(2) an entity exercising the powers of a housing and redevelopment authority within 
56.20 	a political subdivision;
56.21 	(3) a limited partnership in which the sole or managing general partner is an 
56.22 	authority under clause (1) or an entity under clause (2), (4), or (5);
56.23 	(4) a nonprofit corporation subject to the provisions of chapter 317A, and qualifying 
56.24 	under section 501(c)(3) or 501(c)(4) of the Internal Revenue Code of 1986, as amended;
56.25 	(5) a limited liability company if it consists of a sole member that is an entity under 
56.26 	clause (4); or
56.27 	(6) an owner entity, as defined in Code of Federal Regulations, title 24, part 941.604, 
56.28 	for a qualified low-income housing project described in paragraph (b), clause (5).
56.29 	This exemption applies regardless of whether the purchases are made by the owner 
56.30 	of the facility or a contractor.
56.31 	(b) For purposes of this exemption, "qualified low-income housing project" means:
56.32 	(1) a housing or mixed use project in which at least 20 percent of the residential units 
56.33 	are qualifying low-income rental housing units as defined in section 273.126 273.128;
56.34 	(2) a federally assisted low-income housing project financed by a mortgage insured 
56.35 	or held by the United States Department of Housing and Urban Development under 
57.1 	United States Code, title 12, section 1701s, 1715l(d)(3), 1715l(d)(4), or 1715z-1; United 
57.2 	States Code, title 42, section 1437f; the Native American Housing Assistance and 
57.3 	Self-Determination Act, United States Code, title 25, section 4101 et seq.; or any similar 
57.4 	successor federal low-income housing program;
57.5 	(3) a qualified low-income housing project as defined in United States Code, title 
57.6 	26, section 42(g), meeting all of the requirements for a low-income housing credit under 
57.7 	section 42 of the Internal Revenue Code regardless of whether the project actually applies 
57.8 	for or receives a low-income housing credit;
57.9 	(4) a project that will be operated in compliance with Internal Revenue Service 
57.10 	revenue procedure 96-32; or
57.11 	(5) a housing or mixed use project in which all or a portion of the residential units 
57.12 	are subject to the requirements of section 5 of the United States Housing Act of 1937.
57.13 	(c) For a project, a portion of which is not used for low-income housing units, 
57.14 	the amount of purchases that are exempt under this subdivision must be determined by 
57.15 	multiplying the total purchases, as specified in paragraph (a), by the ratio of:
57.16 	(1) the total gross square footage of units subject to the income limits under section 
57.17 	273.126 273.128, the financing for the project, the federal low-income housing tax credit, 
57.18 	revenue procedure 96-32, or section 5 of the United States Housing Act of 1937, as 
57.19 	applicable to the project; and
57.20 	(2) the total gross square footage of all units in the project.
57.21 	(d) The tax must be imposed and collected as if the rate under section 297A.62, 
57.22 	subdivision 1, applied, and then refunded in the manner provided in section 297A.75.

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

57.24 	Sec. 3. Minnesota Statutes 2010, section 297A.89, subdivision 2, is amended to read:
57.25 		Subd. 2.Retailer does not collect. The retailer shall not collect the tax from a 
57.26 	purchaser who furnishes to the retailer a copy of a fully completed exemption certificate 
57.27 	issued by the commissioner authorizing as described in section 297A.72, indicating that
57.28 	the purchaser is authorized to pay any sales or use tax due on purchases made by the 
57.29 	purchaser directly to the commissioner under subdivision 1.

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

57.31 	Sec. 4. Minnesota Statutes 2010, section 297B.08, is amended to read:
57.32 	297B.08 TAX PAID IN OTHER STATE; CREDIT, RECIPROCITY.
58.1 	If any motor vehicle has been or is subject to a tax by any other state in respect to 
58.2 	its sale or use, in an amount less than the tax imposed by this chapter and chapter 297A, 
58.3 	the provisions of this chapter and chapter 297A, shall apply, but at a rate measured by 
58.4 	the difference only between the rate fixed in this chapter 297A, and the rate by which the 
58.5 	previous tax paid in the other state upon the sale or use was computed. If the rate of 
58.6 	tax imposed in such other state is the same or more than the rate of tax imposed by this 
58.7 	chapter 297A, then no tax shall be due on such motor vehicle. The provisions of this 
58.8 	section shall apply only if such other state allows a credit with respect to the excise tax 
58.9 	imposed by this chapter and chapter 297A, which is substantially similar in effect to 
58.10 	the credit allowed by this section.

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

58.12 	ARTICLE 9
58.13 	DEPARTMENT TECHNICAL: SPECIAL TAXES

58.14 	Section 1. Minnesota Statutes 2010, section 296A.083, is amended by adding a 
58.15 	subdivision to read:
58.16 		Subd. 4.Apportionment. The surcharge under this section is subject to the 
58.17 	apportionment provisions of section 296A.18.

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

58.19 	Sec. 2. Minnesota Statutes 2010, section 296A.18, is amended by adding a subdivision 
58.20 	to read:
58.21 		Subd. 6a.Computation of nonhighway use amounts. The nonhighway use 
58.22 	amounts determined in subdivisions 2 to 6 must be transferred from the highway user tax 
58.23 	distribution fund to the accounts as provided for in sections 84.794, 84.803, 84.83, 84.927, 
58.24 	and 86B.706. These amounts, together with interest and penalties for delinquency in 
58.25 	payment, paid or collected pursuant to the provisions of this chapter, must be computed 
58.26 	for each six-month period ending June 30 and December 31 and must be transferred on 
58.27 	November 1 and June 1 following each six-month period.

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

58.29 	Sec. 3. Minnesota Statutes 2010, section 296A.18, subdivision 7, is amended to read:
58.30 		Subd. 7.Forest road. Approximately 0.116 percent of the total annual unrefunded 
58.31 	revenue from the gasoline fuel tax on all gasoline and special fuel received in, produced, 
59.1 	or brought into this state, except gasoline and special fuel used for aviation purposes, is 
59.2 	derived from the operation of motor vehicles on state forest roads and county forest access 
59.3 	roads. This revenue, together with interest and penalties for delinquency in payment, paid 
59.4 	or collected pursuant to the provisions of this chapter, is appropriated from the highway 
59.5 	user tax distribution fund and must be transferred and credited in equal installments on 
59.6 	July 1 and January 1 to the state forest road account established in section 89.70. Of this 
59.7 	amount, 0.0605 percent is annually derived from motor vehicles operated on state forest 
59.8 	roads and 0.0555 percent is annually derived from motor vehicles operated on county 
59.9 	forest access roads in this state. An amount equal to 0.0555 percent of the unrefunded 
59.10 	revenue must be annually transferred to counties for the management and maintenance of 
59.11 	county forest roads. 

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

59.13 	Sec. 4. Minnesota Statutes 2010, section 297I.15, is amended by adding a subdivision 
59.14 	to read:
59.15 		Subd. 12.Federal Employees Health Benefits Program. Premiums received 
59.16 	under the Federal Employees Health Benefits Act, United States Code, title 5, section 
59.17 	8909(f), as amended by the Omnibus Reconciliation Act of 1990, are exempt from the 
59.18 	taxes and surcharges imposed under this chapter.

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

59.20 	Sec. 5. Minnesota Statutes 2010, section 298.225, subdivision 1, is amended to read:
59.21 		Subdivision 1.Guaranteed distribution. (a) The distribution of the taconite 
59.22 	production tax as provided in section 298.28, subdivisions 2, paragraph (a), 3 to 5, 6, 
59.23 	paragraph (b), 7, and 8, shall equal the lesser of the following amounts: 
59.24 	(1) the amount distributed pursuant to this section and section 298.28, with respect 
59.25 	to 1983 production if the production for the year prior to the distribution year is no less 
59.26 	than 42,000,000 taxable tons. If the production is less than 42,000,000 taxable tons, the 
59.27 	amount of the distributions shall be reduced proportionately at the rate of two percent 
59.28 	for each 1,000,000 tons, or part of 1,000,000 tons by which the production is less than 
59.29 	42,000,000 tons; or 
59.30 	(2)(i) for the distributions made pursuant to section 298.28, subdivisions 4, 
59.31 	paragraphs (b) and (c), and 6, paragraph (c), 31.2 percent of the amount distributed 
59.32 	pursuant to this section and section 298.28, with respect to 1983 production; 
60.1 	(ii) for the distributions made pursuant to section 298.28, subdivision 5, paragraphs 
60.2 	(b) and (d), 75 percent of the amount distributed pursuant to this section and section 
60.3 	298.28, with respect to 1983 production. 
60.4 	(b) The distribution of the taconite production tax as provided in section 298.28, 
60.5 	subdivision 2, paragraph (b), shall equal the following amount: 
60.6 	(1) if the production for the year prior to the distribution year is at least 42,000,000 
60.7 	taxable tons, the amount distributed pursuant to this section and section 298.28 with 
60.8 	respect to 1999 production; or 
60.9 	(2) if the production for the year prior to the distribution year is less than 42,000,000 
60.10 	taxable tons, the amount distributed pursuant to this section and section 298.28 with respect 
60.11 	to 1999 production, reduced proportionately at the rate of two percent for each 1,000,000 
60.12 	tons or part of 1,000,000 tons by which the production is less than 42,000,000 tons. 

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

60.14 	Sec. 6. Minnesota Statutes 2010, section 298.28, subdivision 2, is amended to read:
60.15 		Subd. 2.City or town where quarried or produced. (a) 4.5 cents per gross ton of 
60.16 	merchantable iron ore concentrate, hereinafter referred to as "taxable ton," plus the amount 
60.17 	provided in paragraph (c), must be allocated to the city or town in the county in which 
60.18 	the lands from which taconite was mined or quarried were located or within which the 
60.19 	concentrate was produced. If the mining, quarrying, and concentration, or different steps 
60.20 	in either thereof are carried on in more than one taxing district, the commissioner shall 
60.21 	apportion equitably the proceeds of the part of the tax going to cities and towns among 
60.22 	such subdivisions upon the basis of attributing 50 percent of the proceeds of the tax to 
60.23 	the operation of mining or quarrying the taconite, and the remainder to the concentrating 
60.24 	plant and to the processes of concentration, and with respect to each thereof giving due 
60.25 	consideration to the relative extent of such operations performed in each such taxing 
60.26 	district. The commissioner's order making such apportionment shall be subject to review 
60.27 	by the Tax Court at the instance of any of the interested taxing districts, in the same 
60.28 	manner as other orders of the commissioner.
60.29 	(b) Four cents per taxable ton shall be allocated to cities and organized townships 
60.30 	affected by mining because their boundaries are within three miles of a taconite mine pit 
60.31 	that has been actively mined in at least one of the prior three years. If a city or town is 
60.32 	located near more than one mine meeting these criteria, the city or town is eligible to 
60.33 	receive aid calculated from only the mine producing the largest taxable tonnage. When 
60.34 	more than one municipality qualifies for aid based on one company's production, the aid 
60.35 	must be apportioned among the municipalities in proportion to their populations. Of the 
61.1 	amounts distributed under this paragraph to each municipality, one-half must be used for 
61.2 	infrastructure improvement projects, and one-half must be used for projects in which two 
61.3 	or more municipalities cooperate. Each municipality that receives a distribution under this 
61.4 	paragraph must report annually to the Iron Range Resources and Rehabilitation Board and 
61.5 	the commissioner of Iron Range resources and rehabilitation on the projects involving 
61.6 	cooperation with other municipalities.
61.7 	(c) The amount that would have been computed for the current year under Minnesota 
61.8 	Statutes 2008, section 126C.21, subdivision 4, for a school district within which the 
61.9 	taconite was mined or quarried or within which the concentrate is produced is added to 
61.10 	the amount to be distributed to the cities and towns located within that school district as 
61.11 	provided in paragraph (a) shall be distributed to the cities and townships within the school 
61.12 	district in the proportion that their taxable net tax capacity within the school district bears 
61.13 	to the taxable net tax capacity of the school district for property taxes payable in the 
61.14 	year prior to distribution.

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

61.16 	Sec. 7.  REPEALER.
 61.17 	Minnesota Statutes 2010, section 296A.18, subdivision 9, is repealed.

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

61.19 	ARTICLE 10
61.20 	DEPARTMENT TECHNICAL: MISCELLANEOUS

61.21 	Section 1. Minnesota Statutes 2010, section 270A.03, subdivision 7, is amended to 
61.22 	read:
61.23 		Subd. 7.Refund. "Refund" means an individual income tax refund or political 
61.24 	contribution refund, pursuant to chapter 290, or a property tax credit or refund, pursuant to 
61.25 	chapter 290A, or a sustainable forest tax payment to a claimant under chapter 290C.
61.26 	For purposes of this chapter, lottery prizes, as set forth in section 349A.08, 
61.27 	subdivision 8, and amounts granted to persons by the legislature on the recommendation 
61.28 	of the joint senate-house of representatives Subcommittee on Claims shall be treated 
61.29 	as refunds.
61.30 	In the case of a joint property tax refund payable to spouses under chapter 290A, 
61.31 	the refund shall be considered as belonging to each spouse in the proportion of the total 
61.32 	refund that equals each spouse's proportion of the total income determined under section 
61.33 	290A.03, subdivision 3. In the case of a joint income tax refund under chapter 289A, the 
62.1 	refund shall be considered as belonging to each spouse in the proportion of the total 
62.2 	refund that equals each spouse's proportion of the total taxable income determined under 
62.3 	section 290.01, subdivision 29. The commissioner shall remit the entire refund to the 
62.4 	claimant agency, which shall, upon the request of the spouse who does not owe the debt, 
62.5 	determine the amount of the refund belonging to that spouse and refund the amount to 
62.6 	that spouse. For court fines, fees, and surcharges and court-ordered restitution under 
62.7 	section 611A.04, subdivision 2, the notice provided by the commissioner of revenue under 
62.8 	section 270A.07, subdivision 2, paragraph (b), serves as the appropriate legal notice 
62.9 	to the spouse who does not owe the debt.

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

62.11 	Sec. 2. Minnesota Statutes 2010, section 270C.30, is amended to read:
62.12 	270C.30 RETURNS AND OTHER DOCUMENTS; FORMAT; FURNISHING.
62.13 	The commissioner shall prescribe the content and format of all returns and other 
62.14 	forms required to be filed under a law administered by the commissioner, and may furnish 
62.15 	them subject to charge on application.

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

62.17 	Sec. 3. Minnesota Statutes 2010, section 469.319, subdivision 5, is amended to read:
62.18 		Subd. 5.Waiver authority. (a) The commissioner may waive all or part of a 
62.19 	repayment required under subdivision 1, if the commissioner, in consultation with 
62.20 	the commissioner of employment and economic development and appropriate officials 
62.21 	from the local government units in which the qualified business is located, determines 
62.22 	that requiring repayment of the tax is not in the best interest of the state or the local 
62.23 	government units and the business ceased operating as a result of circumstances beyond 
62.24 	its control including, but not limited to:
62.25 	(1) a natural disaster;
62.26 	(2) unforeseen industry trends; or
62.27 	(3) loss of a major supplier or customer.
62.28 	(b)(1) The commissioner shall waive repayment required under subdivision 1a if 
62.29 	the commissioner has waived repayment by the operating business under subdivision 1, 
62.30 	unless the person that received benefits without having to operate a business in the zone 
62.31 	was a contributing factor in the qualified business becoming subject to repayment under 
62.32 	subdivision 1;
63.1 	(2) the commissioner shall waive the repayment required under subdivision 1a, even 
63.2 	if the repayment has not been waived for the operating business if:
63.3 	(i) the person that received benefits without having to operate a business in the zone 
63.4 	and the business that operated in the zone are not related parties as defined in section 
63.5 	267(b) of the Internal Revenue Code of 1986, as amended through December 31, 2007; and
63.6 	(ii) actions of the person were not a contributing factor in the qualified business 
63.7 	becoming subject to repayment under subdivision 1.
63.8 	(c) Requests for waiver must be made no later than 60 days after the earlier of 
63.9 	the notice date of an order issued under subdivision 4, paragraph (d), or, in the case of 
63.10 	property taxes, within 60 days of the date of a tax statement issued under subdivision 4, 
63.11 	paragraph (c).

63.12 	EFFECTIVE DATE. This section is effective for waivers requested in response 
63.13 	to notices issued after the day following final enactment.

63.14 	ARTICLE 11
63.15 	MISCELLANEOUS

63.16 	Section 1. Minnesota Statutes 2010, section 270A.03, subdivision 2, is amended to 
63.17 	read:
63.18 		Subd. 2.Claimant agency. "Claimant agency" means any state agency, as defined 
63.19 	by section 14.02, subdivision 2, the regents of the University of Minnesota, any district 
63.20 	court of the state, any county, any statutory or home rule charter city, including a city 
63.21 	that is presenting a claim for a municipal hospital or a public library or a municipal 
63.22 	ambulance service, a hospital district, a private nonprofit hospital that leases its building 
63.23 	from the county or city in which it is located, any ambulance service licensed under 
63.24 	chapter 144E, any public agency responsible for child support enforcement, any public 
63.25 	agency responsible for the collection of court-ordered restitution, and any public agency 
63.26 	established by general or special law that is responsible for the administration of a 
63.27 	low-income housing program, and the Minnesota collection enterprise as defined in 
63.28 	section 16D.02, subdivision 8, for the purpose of collecting the costs imposed under 
63.29 	section 16D.11. A county may act as a claimant agency on behalf of an ambulance service 
63.30 	licensed under chapter 144E if the ambulance service's primary service area is located at 
63.31 	least in part within the county, but more than one county may not act as a claimant agency 
63.32 	for a licensed ambulance service with respect to the same debt.

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

64.1 	Sec. 2. Minnesota Statutes 2010, section 270A.07, subdivision 1, is amended to read:
64.2 		Subdivision 1.Notification requirement. (a) Any claimant agency, seeking 
64.3 	collection of a debt through setoff against a refund due, shall submit to the commissioner 
64.4 	information indicating the amount of each debt and information identifying the debtor, as 
64.5 	required by section 270A.04, subdivision 3.
64.6 	(b) For each setoff of a debt against a refund due, the commissioner shall charge a fee 
64.7 	of $15. The proceeds of fees shall be allocated by depositing $4 of each $15 fee collected 
64.8 	into a Department of Revenue recapture revolving fund and depositing the remaining 
64.9 	balance into the general fund. The sums deposited into the revolving fund are appropriated 
64.10 	to the commissioner for the purpose of administering the Revenue Recapture Act.
64.11 	(c) For each debt for which a county acts as claimant agency on behalf of a licensed 
64.12 	ambulance service, the county may charge the ambulance service a fee not to exceed the 
64.13 	cost of administering the claim.
64.14 	(d) The claimant agency shall notify the commissioner when a debt has been 
64.15 	satisfied or reduced by at least $200 within 30 days after satisfaction or reduction.

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

64.17 	Sec. 3. Minnesota Statutes 2010, section 272.02, is amended by adding a subdivision 
64.18 	to read:
64.19 		Subd. 95.St. Louis County fairgrounds. Land and buildings used exclusively for 
64.20 	county or community fairgrounds as provided in section 383C.164.

64.21 	EFFECTIVE DATE. This section is effective for taxes payable in 2012 and 
64.22 	thereafter.

64.23 	Sec. 4. Minnesota Statutes 2010, section 273.13, subdivision 23, is amended to read:
64.24 		Subd. 23.Class 2. (a) An agricultural homestead consists of class 2a agricultural 
64.25 	land that is homesteaded, along with any class 2b rural vacant land that is contiguous to 
64.26 	the class 2a land under the same ownership. The market value of the house and garage 
64.27 	and immediately surrounding one acre of land has the same class rates as class 1a or 1b 
64.28 	property under subdivision 22. The value of the remaining land including improvements 
64.29 	up to the first tier valuation limit of agricultural homestead property has a net class rate 
64.30 	of 0.5 percent of market value. The remaining property over the first tier has a class rate 
64.31 	of one percent of market value. For purposes of this subdivision, the "first tier valuation 
64.32 	limit of agricultural homestead property" and "first tier" means the limit certified under 
64.33 	section 273.11, subdivision 23.
65.1 	(b) Class 2a agricultural land consists of parcels of property, or portions thereof, that 
65.2 	are agricultural land and buildings. Class 2a property has a net class rate of one percent of 
65.3 	market value, unless it is part of an agricultural homestead under paragraph (a). Class 
65.4 	2a property must also include any property that would otherwise be classified as 2b, 
65.5 	but is interspersed with class 2a property, including but not limited to sloughs, wooded 
65.6 	wind shelters, acreage abutting ditches, ravines, rock piles, land subject to a setback 
65.7 	requirement, and other similar land that is impractical for the assessor to value separately 
65.8 	from the rest of the property or that is unlikely to be able to be sold separately from 
65.9 	the rest of the property.
65.10 	An assessor may classify the part of a parcel described in this subdivision that is used 
65.11 	for agricultural purposes as class 2a and the remainder in the class appropriate to its use.
65.12 	(c) Class 2b rural vacant land consists of parcels of property, or portions thereof, 
65.13 	that are unplatted real estate, rural in character and not used for agricultural purposes, 
65.14 	including land used for growing trees for timber, lumber, and wood and wood products, 
65.15 	that is not improved with a structure. The presence of a minor, ancillary nonresidential 
65.16 	structure as defined by the commissioner of revenue does not disqualify the property from 
65.17 	classification under this paragraph. Any parcel of 20 acres or more improved with a 
65.18 	structure that is not a minor, ancillary nonresidential structure must be split-classified, and 
65.19 	ten acres must be assigned to the split parcel containing the structure. Class 2b property 
65.20 	has a net class rate of one percent of market value unless it is part of an agricultural 
65.21 	homestead under paragraph (a), or qualifies as class 2c under paragraph (d).
65.22 	(d) Class 2c managed forest land consists of no less than 20 and no more than 1,920 
65.23 	acres statewide per taxpayer that is being managed under a forest management plan that 
65.24 	meets the requirements of chapter 290C, but is not enrolled in the sustainable forest 
65.25 	resource management incentive program. It has a class rate of .65 percent, provided that 
65.26 	the owner of the property must apply to the assessor in order for the property to initially 
65.27 	qualify for the reduced rate and provide the information required by the assessor to verify 
65.28 	that the property qualifies for the reduced rate. If the assessor receives the application 
65.29 	and information before May 1 in an assessment year, the property qualifies beginning 
65.30 	with that assessment year. If the assessor receives the application and information after 
65.31 	April 30 in an assessment year, the property may not qualify until the next assessment 
65.32 	year. The commissioner of natural resources must concur that the land is qualified. The 
65.33 	commissioner of natural resources shall annually provide county assessors verification 
65.34 	information on a timely basis. The presence of a minor, ancillary nonresidential structure 
65.35 	as defined by the commissioner of revenue does not disqualify the property from 
65.36 	classification under this paragraph.
66.1 	(e) Agricultural land as used in this section means contiguous acreage of ten 
66.2 	acres or more, used during the preceding year for agricultural purposes. "Agricultural 
66.3 	purposes" as used in this section means the raising, cultivation, drying, or storage of 
66.4 	agricultural products for sale, or the storage of machinery or equipment used in support 
66.5 	of agricultural production by the same farm entity. For a property to be classified as 
66.6 	agricultural based only on the drying or storage of agricultural products, the products 
66.7 	being dried or stored must have been produced by the same farm entity as the entity 
66.8 	operating the drying or storage facility. "Agricultural purposes" also includes enrollment 
66.9 	in the Reinvest in Minnesota program under sections 103F.501 to 103F.535 or the federal 
66.10 	Conservation Reserve Program as contained in Public Law 99-198 or a similar state 
66.11 	or federal conservation program if the property was classified as agricultural (i) under 
66.12 	this subdivision for the assessment year 2002 or (ii) in the year prior to its enrollment. 
66.13 	Agricultural classification shall not be based upon the market value of any residential 
66.14 	structures on the parcel or contiguous parcels under the same ownership.
66.15 	(f) Real estate of less than ten acres, which is exclusively or intensively used for 
66.16 	raising or cultivating agricultural products, shall be considered as agricultural land. To 
66.17 	qualify under this paragraph, property that includes a residential structure must be used 
66.18 	intensively for one of the following purposes:
66.19 	(i) for drying or storage of grain or storage of machinery or equipment used to 
66.20 	support agricultural activities on other parcels of property operated by the same farming 
66.21 	entity;
66.22 	(ii) as a nursery, provided that only those acres used to produce nursery stock are 
66.23 	considered agricultural land;
66.24 	(iii) for livestock or poultry confinement, provided that land that is used only for 
66.25 	pasturing and grazing does not qualify; or
66.26 	(iv) for market farming; for purposes of this paragraph, "market farming" means the 
66.27 	cultivation of one or more fruits or vegetables or production of animal or other agricultural 
66.28 	products for sale to local markets by the farmer or an organization with which the farmer 
66.29 	is affiliated.
66.30 	(g) Land shall be classified as agricultural even if all or a portion of the agricultural 
66.31 	use of that property is the leasing to, or use by another person for agricultural purposes.
66.32 	Classification under this subdivision is not determinative for qualifying under 
66.33 	section 273.111.
66.34 	(h) The property classification under this section supersedes, for property tax 
66.35 	purposes only, any locally administered agricultural policies or land use restrictions that 
66.36 	define minimum or maximum farm acreage.
67.1 	(i) The term "agricultural products" as used in this subdivision includes production 
67.2 	for sale of:
67.3 	(1) livestock, dairy animals, dairy products, poultry and poultry products, fur-bearing 
67.4 	animals, horticultural and nursery stock, fruit of all kinds, vegetables, forage, grains, 
67.5 	bees, and apiary products by the owner;
67.6 	(2) fish bred for sale and consumption if the fish breeding occurs on land zoned 
67.7 	for agricultural use;
67.8 	(3) the commercial boarding of horses, which may include related horse training and 
67.9 	riding instruction, if the boarding is done on property that is also used for raising pasture 
67.10 	to graze horses or raising or cultivating other agricultural products as defined in clause (1);
67.11 	(4) property which is owned and operated by nonprofit organizations used for 
67.12 	equestrian activities, excluding racing;
67.13 	(5) game birds and waterfowl bred and raised (i) on a game farm licensed under 
67.14 	section 97A.105, provided that the annual licensing report, which must be submitted 
67.15 	annually by March 30 to the assessor, to the Department of Natural Resources indicates 
67.16 	that at least 500 birds were raised or used for breeding stock on the property during the 
67.17 	year; or (ii) for use on a shooting preserve licensed under section 97A.115;
67.18 	(6) insects primarily bred to be used as food for animals;
67.19 	(7) trees, grown for sale as a crop, including short rotation woody crops, and not 
67.20 	sold for timber, lumber, wood, or wood products; and
67.21 	(8) maple syrup taken from trees grown by a person licensed by the Minnesota 
67.22 	Department of Agriculture under chapter 28A as a food processor.
67.23 	(j) If a parcel used for agricultural purposes is also used for commercial or industrial 
67.24 	purposes, including but not limited to:
67.25 	(1) wholesale and retail sales;
67.26 	(2) processing of raw agricultural products or other goods;
67.27 	(3) warehousing or storage of processed goods; and
67.28 	(4) office facilities for the support of the activities enumerated in clauses (1), (2), 
67.29 	and (3),
67.30 	the assessor shall classify the part of the parcel used for agricultural purposes as class 
67.31 	1b, 2a, or 2b, whichever is appropriate, and the remainder in the class appropriate to its 
67.32 	use. The grading, sorting, and packaging of raw agricultural products for first sale is 
67.33 	considered an agricultural purpose. A greenhouse or other building where horticultural 
67.34 	or nursery products are grown that is also used for the conduct of retail sales must be 
67.35 	classified as agricultural if it is primarily used for the growing of horticultural or nursery 
67.36 	products from seed, cuttings, or roots and occasionally as a showroom for the retail sale of 
68.1 	those products. Use of a greenhouse or building only for the display of already grown 
68.2 	horticultural or nursery products does not qualify as an agricultural purpose.
68.3 	(k) The assessor shall determine and list separately on the records the market value 
68.4 	of the homestead dwelling and the one acre of land on which that dwelling is located. If 
68.5 	any farm buildings or structures are located on this homesteaded acre of land, their market 
68.6 	value shall not be included in this separate determination.
68.7 	(l) Class 2d airport landing area consists of a landing area or public access area of 
68.8 	a privately owned public use airport. It has a class rate of one percent of market value. 
68.9 	To qualify for classification under this paragraph, a privately owned public use airport 
68.10 	must be licensed as a public airport under section 360.018. For purposes of this paragraph, 
68.11 	"landing area" means that part of a privately owned public use airport properly cleared, 
68.12 	regularly maintained, and made available to the public for use by aircraft and includes 
68.13 	runways, taxiways, aprons, and sites upon which are situated landing or navigational aids. 
68.14 	A landing area also includes land underlying both the primary surface and the approach 
68.15 	surfaces that comply with all of the following:
68.16 	(i) the land is properly cleared and regularly maintained for the primary purposes of 
68.17 	the landing, taking off, and taxiing of aircraft; but that portion of the land that contains 
68.18 	facilities for servicing, repair, or maintenance of aircraft is not included as a landing area;
68.19 	(ii) the land is part of the airport property; and
68.20 	(iii) the land is not used for commercial or residential purposes.
68.21 	The land contained in a landing area under this paragraph must be described and certified 
68.22 	by the commissioner of transportation. The certification is effective until it is modified, 
68.23 	or until the airport or landing area no longer meets the requirements of this paragraph. 
68.24 	For purposes of this paragraph, "public access area" means property used as an aircraft 
68.25 	parking ramp, apron, or storage hangar, or an arrival and departure building in connection 
68.26 	with the airport.
68.27 	(m) Class 2e consists of land with a commercial aggregate deposit that is not actively 
68.28 	being mined and is not otherwise classified as class 2a or 2b, provided that the land is not 
68.29 	located in a county that has elected to opt-out of the aggregate preservation program as 
68.30 	provided in section 273.1115, subdivision 6. It has a class rate of one percent of market 
68.31 	value. To qualify for classification under this paragraph, the property must be at least 
68.32 	ten contiguous acres in size and the owner of the property must record with the county 
68.33 	recorder of the county in which the property is located an affidavit containing:
68.34 	(1) a legal description of the property;
68.35 	(2) a disclosure that the property contains a commercial aggregate deposit that is not 
68.36 	actively being mined but is present on the entire parcel enrolled;
69.1 	(3) documentation that the conditional use under the county or local zoning 
69.2 	ordinance of this property is for mining; and
69.3 	(4) documentation that a permit has been issued by the local unit of government 
69.4 	or the mining activity is allowed under local ordinance. The disclosure must include a 
69.5 	statement from a registered professional geologist, engineer, or soil scientist delineating 
69.6 	the deposit and certifying that it is a commercial aggregate deposit.
69.7 	For purposes of this section and section 273.1115, "commercial aggregate deposit" 
69.8 	means a deposit that will yield crushed stone or sand and gravel that is suitable for use 
69.9 	as a construction aggregate; and "actively mined" means the removal of top soil and 
69.10 	overburden in preparation for excavation or excavation of a commercial deposit.
69.11 	(n) When any portion of the property under this subdivision or subdivision 22 begins 
69.12 	to be actively mined, the owner must file a supplemental affidavit within 60 days from 
69.13 	the day any aggregate is removed stating the number of acres of the property that is 
69.14 	actively being mined. The acres actively being mined must be (1) valued and classified 
69.15 	under subdivision 24 in the next subsequent assessment year, and (2) removed from the 
69.16 	aggregate resource preservation property tax program under section 273.1115, if the 
69.17 	land was enrolled in that program. Copies of the original affidavit and all supplemental 
69.18 	affidavits must be filed with the county assessor, the local zoning administrator, and the 
69.19 	Department of Natural Resources, Division of Land and Minerals. A supplemental 
69.20 	affidavit must be filed each time a subsequent portion of the property is actively mined, 
69.21 	provided that the minimum acreage change is five acres, even if the actual mining activity 
69.22 	constitutes less than five acres.
69.23 	(o) The definitions prescribed by the commissioner under paragraphs (c) and (d) are 
69.24 	not rules and are exempt from the rulemaking provisions of chapter 14, and the provisions 
69.25 	in section 14.386 concerning exempt rules do not apply.

69.26 	EFFECTIVE DATE. This section is effective for taxes payable in 2012 and 
69.27 	thereafter.

69.28 	Sec. 5. Minnesota Statutes 2010, section 278.05, subdivision 6, is amended to read:
69.29 		Subd. 6.Dismissal of petition; exclusion of certain evidence. (a) In cases where 
69.30 	the petitioner contests the valuation of income-producing property, information, including 
69.31 	income and expense figures in the form of the following information must be provided to 
69.32 	the county assessor no later than August 1 of the taxes payable year:
69.33 	(1) a year-end financial statements statement for the year prior to the assessment 
69.34 	date,;
69.35 	(2) a year-end financial statements statement for the year of the assessment date, and;
70.1 	(3) a rent rolls roll on or near the assessment date including listing the tenant name, 
70.2 	lease start and end dates, option terms, base rent, square footage leased and vacant space, 
70.3 	verified net rentable areas in the form of net rentable square footage of the building or 
70.4 	buildings, and anticipated income and expenses in the form of proposed budgets for 
70.5 	the year subsequent to the year of the assessment date, must be provided to the county 
70.6 	assessor no later than 60 days after the applicable filing deadline contained in section 
70.7 	278.01, subdivision 1 or 4.;
70.8 	(4) identification of all lease agreements not disclosed on a rent roll in the response 
70.9 	to clause (3), listing the tenant name, lease start and end dates, base rent, and square 
70.10 	footage leased;
70.11 	(5) net rentable square footage of the building or buildings; and
70.12 	(6) anticipated income and expenses in the form of a proposed budget for the year 
70.13 	subsequent to the year of the assessment date.
70.14 	(b) The information required to be provided to the county assessor under paragraph 
70.15 	(a) does not include leases. Failure to provide the information required in this paragraph (a) 
70.16 	shall result in the dismissal of the petition, unless (1) the failure to provide it was due to the 
70.17 	unavailability of the evidence information at the time that the information was due, or (2) 
70.18 	the petitioner was not aware of or informed of the requirement to provide the information.
70.19 	If the petitioner proves that the requirements under clause (2) are met, the petitioner has 
70.20 	an additional 30 days to provide the information from the time the petitioner became 
70.21 	aware of or was informed of the requirement to provide the information, otherwise the 
70.22 	petition shall be dismissed.
70.23 	(c) If, after the August 1 deadline set in paragraph (a), a county assessor determines 
70.24 	that the actual leases in effect on the assessment date are necessary to properly evaluate 
70.25 	the income-producing property, then a county assessor may require that the petitioner 
70.26 	submit the leases. The petitioner must provide the requested information to the county 
70.27 	assessor within 60 days of a county assessor's request. The tax court shall hear and decide 
70.28 	any issues relating to subsequent information requests by a county assessor. Failure to 
70.29 	provide the information required in this paragraph shall be addressed under Rules of 
70.30 	Civil Procedure, rule 37.
70.31 	(b)(d) Provided that the information as contained in paragraph (a) is timely 
70.32 	submitted to the county assessor, the county assessor shall furnish the petitioner at least 
70.33 	five days before the hearing under this chapter with the property's appraisal, if any, 
70.34 	which will be presented to the court at the hearing. The petitioner shall furnish to the 
70.35 	county assessor at least five days before the hearing under this chapter with the property's 
70.36 	appraisal, if any, which will be presented to the court at the hearing. An appraisal of the 
71.1 	petitioner's property done by or for the county shall not be admissible as evidence if the 
71.2 	county assessor does not comply with the provisions in this paragraph. The petition shall 
71.3 	be dismissed if the petitioner does not comply with the provisions in this paragraph.

71.4 	EFFECTIVE DATE. This section is effective for petitions contesting the 2010 
71.5 	assessment and assessments made after that date.

71.6 	Sec. 6. Minnesota Statutes 2010, section 383C.16, subdivision 1, is amended to read:
71.7 		Subdivision 1.Appropriation. The St. Louis County Board may annually 
71.8 	appropriate not to exceed $2,000 funding to assist in the maintaining of a one or more
71.9 	county fair fairs, which fair shall be under the management and control of a county 
71.10 	agricultural society or another entity designated by the board. Such The appropriation 
71.11 	shall be made either to the treasurer of such society or to some other suitable person, but 
71.12 	before such money is paid to such treasurer or other person, the payee shall file with the 
71.13 	county auditor a satisfactory bond in double the sum of said appropriation, conditioned 
71.14 	upon a faithful disbursing and accounting for all of said funds so appropriated. Said 
71.15 	funds so appropriated shall be used solely for the purpose of obtaining, preparing, and 
71.16 	arranging exhibits and paying premiums to exhibitors. The treasurer or other person to 
71.17 	whom said appropriation is paid shall within four months after the holding of any such 
71.18 	aided annual fair, file with the county auditor a verified and detailed report showing the 
71.19 	name and address of every person to whom any of said money was paid, together with 
71.20 	the date of payment and a full description of the purposes for which the money was so 
71.21 	paid and shall attach thereto receipts and subvouchers for each payment so made and shall 
71.22 	return to the county treasurer all of the unexpended portion thereof. After said report and 
71.23 	receipts and subvouchers have been audited by the county board and found to be correct, 
71.24 	they may by resolution release said treasurer or other person and sureties from all further 
71.25 	liabilities under such bond.

71.26 	EFFECTIVE DATE. This section is effective the day after final enactment for taxes 
71.27 	payable in 2012 and thereafter.

71.28 	Sec. 7. [383C.164] FAIRGROUNDS; EXEMPT FROM TAXATION.
71.29 	Land and buildings used exclusively as the site for a county or community fair under 
71.30 	section 383C.16 or 383C.161 are exempt from property taxation.

71.31 	EFFECTIVE DATE. This section is effective for taxes payable in 2012 and 
71.32 	thereafter.

72.1 	Sec. 8. Minnesota Statutes 2010, section 383E.21, is amended to read:
72.2 	383E.21 BONDING FOR COUNTYWIDE PUBLIC SAFETY 
72.3 	COMMUNICATION SYSTEMS IMPROVEMENTS AND EQUIPMENT.
72.4 		Subdivision 1.Authority to incur debt. (a) To finance the cost of designing, 
72.5 	constructing, and acquiring  countywide public safety communication system infrastructure
72.6 	improvements and equipment, including personal property, benefiting both Anoka County 
72.7 	and the municipalities located within Anoka County, the governing body of Anoka 
72.8 	County may issue:
72.9 	(1) capital improvement bonds under the provisions of section 373.40 as if the 
72.10 	infrastructure and equipment qualified as a "capital improvement" within the meaning of 
72.11 	section 373.40, subdivision 1, paragraph (b); and
72.12 	(2) capital notes under the provisions of section 373.01, subdivision 3, as if the 
72.13 	equipment qualified as "capital equipment" within the meaning of section 373.01, 
72.14 	subdivision 3. Personal property acquired with the proceeds of the bonds or capital 
72.15 	notes issued under this section must have an expected useful life at least as long as the 
72.16 	term of debt.
72.17 	(b) The original outstanding principal amount of the bonds and the capital notes 
72.18 	issued under this section may not exceed $12,500,000$8,000,000 at any time. Any bonds 
72.19 	or notes issued pursuant to this section must only be issued after approval by a majority 
72.20 	vote of the Anoka County Joint Law Enforcement Council, a joint powers board.
72.21 		Subd. 2.Treatment of levy. Notwithstanding sections 275.065, subdivision 3, and 
72.22 	276.04, the county may report the tax attributable to any levy to pay principal and interest 
72.23 	on bonds or notes issued under this section as a separate line item on the proposed property 
72.24 	tax notice and the property tax statement. Notwithstanding any provision in chapter 275 or 
72.25 	373 to the contrary, bonds or notes issued by Anoka County under this section must not be 
72.26 	included in the computation of the net debt of Anoka County.
72.27 		Subd. 3.Expiration. This section expires ten years after the first year in which the 
72.28 	county issues a note or bond under this section on December 31, 2023. The county may 
72.29 	not issue a bond or note under this section with a maturity or payment date after the 
72.30 	expiration date of this section. No property tax may be levied under this section for taxes 
72.31 	payable in a calendar year after the calendar year in which this section expires. Expiration 
72.32 	of this section does not affect the obligation to pay or the authority to collect taxes levied 
72.33 	under this section before its expiration.

72.34 	Sec. 9. CITY OF SAUK RAPIDS TAX INCREMENT FINANCING DISTRICT; 
72.35 	INCLUSION OF PARCELS.
 73.1 	Minnesota Statutes, section 469.176, subdivision 7, that restricts inclusion of parcels 
73.2 	qualifying under Minnesota Statutes, section 273.111, in a tax increment financing district, 
73.3 	does not apply to parcels located in the city of Sauk Rapids with the following parcel 
73.4 	identification numbers: 19.04173.00, 19.04174.00, and 19.04176.00, if these parcels 
73.5 	have been withdrawn from the program under Minnesota Statutes, section 273.111, by 
73.6 	June 30, 2011.

73.7 	EFFECTIVE DATE. This act is effective the day following final enactment after 
73.8 	compliance by the governing body of the city of Sauk Rapids with the requirements of 
73.9 	Minnesota Statutes, section 645.021, subdivision 3.