1.1CONFERENCE COMMITTEE REPORT ON H. F. No. 23371.2A bill for an act1.3relating to financing of state and local government; making changes to individual 1.4income, corporate franchise, property, sales and use, mineral, liquor, aggregate 1.5materials, local, and other taxes and tax-related provisions; changing and 1.6providing income and franchise tax credits, exemptions, and deductions; 1.7providing for taxation of foreign operating companies; providing a corporate tax 1.8benefit transfer program; changing certain mining tax rates and allocation of tax 1.9proceeds; changing property tax interest, credits, and exemptions, and providing 1.10for use of a local levy; phasing out the state general levy; modifying the renter 1.11property tax refund and providing a supplemental targeting refund; modifying 1.12city aid payments; modifying tax increment financing district requirements; 1.13authorizing, changing, and extending tax increment financing districts in certain 1.14local governments; changing sales and use tax payment requirements and 1.15changing and providing exemptions; modifying use of revenues and authorizing 1.16extension of certain sales and lodging taxes for certain cities; changing liquor tax 1.17reporting and credits; allocating funds to border city enterprise zones; authorizing 1.18certain local governments to issue public debt; establishing a truth in taxation 1.19task force; establishing a tax reform action committee; establishing a greater 1.20Minnesota internship program; requiring reports; requiring a funds transfer 1.21appropriating money;amending Minnesota Statutes 2010, sections 116J.8737, 1.22subdivisions 5, 8, by adding a subdivision; 273.113; 275.025, subdivisions 1, 1.232, 4; 279.03, subdivisions 1a, 2; 289A.08, subdivision 3; 289A.20, subdivision 1.244; 290.01, subdivisions 19d, 29; 290.06, by adding subdivisions; 290.068, 1.25subdivision 1; 290.17, subdivision 4; 290.21, subdivision 4; 290A.04, 1.26subdivision 2a, by adding a subdivision; 290A.23, subdivision 1; 290B.07; 1.27290B.08, subdivision 2; 297A.68, subdivision 5; 297A.70, subdivision 4, by 1.28adding a subdivision; 297A.8155; 297G.04, subdivision 2; 298.018, subdivision 1.291; 298.28, subdivision 4; 298.75, by adding a subdivision; 469.169, by adding 1.30a subdivision; 477A.011, subdivision 36; 477A.013, by adding a subdivision; 1.31Minnesota Statutes 2011 Supplement, sections 116J.8737, subdivisions 1, 2; 1.32290.01, subdivision 19c; 290A.03, subdivisions 11, 13; 290A.04, subdivision 1.334; 298.01, subdivision 3; 298.015, subdivision 1; 298.28, subdivision 2; 1.34469.176, subdivisions 4c, 4m; 469.1763, subdivision 2; 477A.013, subdivision 1.359; Laws 1971, chapter 773, section 1, subdivision 2, as amended; Laws 1988, 1.36chapter 645, section 3, as amended; Laws 1998, chapter 389, article 8, section 1.3743, subdivision 3, as amended; Laws 2002, chapter 377, article 3, section 25, 1.38as amended; Laws 2003, chapter 127, article 12, section 28; Laws 2005, First 1.39Special Session chapter 3, article 5, section 37, subdivisions 2, 4; Laws 2008, 1.40chapter 366, article 5, section 34, as amended; article 7, section 19, subdivision 1.413, as amended; Laws 2010, chapter 389, article 1, section 12; proposing coding 1.42for new law in Minnesota Statutes, chapters 116J; 136A; repealing Minnesota 1.43Statutes 2010, section 290.0921, subdivision 7; Minnesota Statutes 2011 2.1Supplement, section 289A.60, subdivision 31; Laws 2009, chapter 88, article 4, 2.2section 23, as amended.2.3April 30, 20122.4The Honorable Kurt Zellers2.5Speaker of the House of Representatives2.6The Honorable Michelle L. Fischbach2.7President of the Senate2.8We, the undersigned conferees for H. F. No. 2337 report that we have agreed upon 2.9the items in dispute and recommend as follows:2.10That the Senate recede from its amendments and that H. F. No. 2337 be further 2.11amended as follows:2.12Delete everything after the enacting clause and insert:2.13"ARTICLE 12.14PROPERTY TAXES2.15    Section 1. Minnesota Statutes 2010, section 6.91, subdivision 2, is amended to read:2.16    Subd. 2. Benefits of participation. (a) A county or city that elects to participate in 2.17the standard measures program for 2011 is: (1) eligible for per capita reimbursement of 2.18$0.14 per capita, but not to exceed $25,000 for any government entity; and (2) exempt 2.19from levy limits under sections 
         275.70 to 
         275.74 for taxes payable in 2012, if levy limits 2.20are in effect.2.21(b) Any county or city that elects to participate in the standard measures program 2.22for 2012 is eligible for per capita reimbursement of $0.14 per capita, but not to exceed 2.23$25,000 for any government entity, provided that for 2012, a county or city with a 2.24population over 5,000 must also participate in the expenditure-type reporting under section 2.25471.703 in order to be eligible. Any jurisdiction participating in the comprehensive 2.26performance measurement program is exempt from levy limits under sections 
         275.70 to 2.27275.74
          for taxes payable in 2013 if levy limits are in effect.2.28(c) Any county or city that elects to participate in the standard measures program for 2.292013 or any year thereafter is eligible for per capita reimbursement of $0.14 per capita, 2.30but not to exceed $25,000 for any government entity. Any jurisdiction participating in 2.31the comprehensive performance measurement program for 2013 or any year thereafter is 2.32exempt from levy limits under sections 
         275.70 to 
         275.74 for taxes payable in the following 2.33year, if levy limits are in effect.2.34EFFECTIVE DATE.This section is effective the day following final enactment.2.35    Sec. 2. Minnesota Statutes 2010, section 273.113, is amended to read:3.1273.113 TAX CREDIT FOR PROPERTY IN PROPOSED BOVINE 3.2TUBERCULOSIS MODIFIED ACCREDITED MANAGEMENT ZONE.3.3    Subdivision 1. Definitions. For the purposes of this section, the following terms 3.4have the meanings given to them:3.5    (1) "bovine tuberculosis modified accredited management zone" means the modified 3.6accredited management zone designated by the Board of Animal Health under section 3.735.244
         ;3.8    (2) "located within" means that the herd is kept in the area for at least a part of 3.9calendar year 2006, 2007, or 2008; and3.10    (3) "animal" means cattle, bison, goats, and farmed cervidae.3.11    Subd. 2. Eligibility; amount of credit. Agricultural and rural vacant land classified 3.12under section 
         273.13, subdivision 23, located within a bovine tuberculosis modified 3.13accredited management zone is eligible for a property tax credit equal to the greater of: (1) 3.14$5 per acre on the first 160 acres of the property where the herd had been located; or (2) an 3.15amount equal to $5 per acre times five acres times the highest number of animals tested 3.16on the property for bovine tuberculosis in a whole-herd test as reported by the Board of 3.17Animal Health in 2006, 2007, or 2008 the amount of credit received under this section for 3.18taxes payable in 2011. The amount of the credit cannot exceed the property tax payable on 3.19the property where the herd had been located, excluding any tax attributable to residential 3.20structures. To begin to qualify for the tax credit for taxes payable in 2012, the owner shall 3.21file an application with the county by December 1 of the levy year July 1, 2012. For 3.22taxes payable in 2012, the credit shall be paid as a direct payment to the property owner, 3.23issued by the county within 30 days of receipt of the application, provided that there are 3.24no delinquent taxes on the property. The credit must be given for each subsequent taxes 3.25payable year until the credit terminates under subdivision 4. For taxes payable in 2013 3.26and thereafter, the assessor shall indicate the amount of the property tax reduction on the 3.27property tax statement of each taxpayer receiving a credit under this section. For taxes 3.28payable in 2013 and thereafter, the credit paid pursuant to this section shall be deducted 3.29from the tax due on the property as provided in section 
         273.1393.3.30    Subd. 3. Reimbursement for lost revenue. The county auditor shall certify to the 3.31commissioner of revenue, as part of the abstracts of tax lists required to be filed with the 3.32commissioner under section 
         275.29, the amount of tax lost to the county from the property 3.33tax credit under subdivision 2, except that for taxes payable in 2012 only, the county shall 3.34submit the credit amounts to the commissioner of revenue in a separate report, in a form 3.35prescribed by the commissioner, prior to August 15, 2012. Any prior year adjustments 3.36must also be certified in the abstracts of tax lists. The commissioner of revenue shall 4.1review the certifications to determine their accuracy. The commissioner may make the 4.2changes in the certification that are considered necessary or return a certification to the 4.3county auditor for corrections. The commissioner shall reimburse each taxing district, 4.4other than school districts, for the taxes lost. The payments must be made at the time 4.5provided in section 
         473H.10 for payment to taxing jurisdictions in the same proportion 4.6that the ad valorem tax is distributed, except that for taxes payable in 2012 the entire 4.7reimbursement must be made to the county. Reimbursements to school districts must be 4.8made as provided in section 
         273.1392. The amount necessary to make the reimbursements 4.9under this section is annually appropriated from the general fund to the commissioner of 4.10revenue.4.11    Subd. 4. Termination of credit. The credits provided under this section cease to 4.12be available beginning with taxes payable in the year following the date when the Board 4.13of Animal Health notifies the commissioner of revenue in writing that the board has 4.14certified that the state is free ofdiscontinued all required bovine tuberculosis related 4.15activities within the bovine tuberculosis management zone.4.16EFFECTIVE DATE.This section is effective for taxes payable in 2012 and 4.17thereafter.4.18    Sec. 3. Minnesota Statutes 2010, section 275.025, subdivision 1, is amended to read:4.19    Subdivision 1. Levy amount. The state general levy is levied against 4.20commercial-industrial property and seasonal residential recreational property, as defined in 4.21this section. The state general levy base amount is $592,000,000 $817,423,000 for taxes 4.22payable in 2002 2013 and thereafter. For taxes payable in subsequent years, the levy base 4.23amount is increased each year by multiplying the levy base amount for the prior year by 4.24the sum of one plus the rate of increase, if any, in the implicit price deflator for government 4.25consumption expenditures and gross investment for state and local governments prepared 4.26by the Bureau of Economic Analysts of the United States Department of Commerce for 4.27the 12-month period ending March 31 of the year prior to the year the taxes are payable.4.28The tax under this section is not treated as a local tax rate under section 
         469.177 and is not 4.29the levy of a governmental unit under chapters 276A and 473F.4.30The commissioner shall increase or decrease the preliminary or final rate rates for a 4.31year as necessary to account for errors and tax base changes that affected a preliminary or 4.32final rate for either of the two preceding years. Adjustments are allowed to the extent that 4.33the necessary information is available to the commissioner at the time the rates for a year 4.34must be certified, and for the following reasons:4.35(1) an erroneous report of taxable value by a local official;5.1(2) an erroneous calculation by the commissioner; and5.2(3) an increase or decrease in taxable value for commercial-industrial or seasonal 5.3residential recreational property reported on the abstracts of tax lists submitted under 5.4section 
         275.29 that was not reported on the abstracts of assessment submitted under 5.5section 
         270C.89 for the same year.5.6The commissioner may, but need not, make adjustments if the total difference in the tax 5.7levied for the year would be less than $100,000.5.8EFFECTIVE DATE.This section is effective for taxes payable in 2013 and 5.9thereafter.5.10    Sec. 4. Minnesota Statutes 2010, section 275.065, subdivision 1, is amended to read:5.11    Subdivision 1. Proposed levy. (a) Notwithstanding any law or charter to the 5.12contrary, on or before September 15, each taxing authority, other than a school district, 5.13shall adopt a proposed budget and shall certify to the county auditor the proposed or, in 5.14the case of a town, the final property tax levy for taxes payable in the following year. All 5.15counties with a population of more than 5,000 and home rule charter or statutory cities 5.16with a population of more than 5,000, shall also provide to the county auditor the county 5.17or city Web site, if there is one, where the public is able to access the budget information 5.18required to be reported under section 471.703.5.19    (b) On or before September 30, each school district that has not mutually agreed 5.20with its home county to extend this date shall certify to the county auditor the proposed 5.21property tax levy for taxes payable in the following year. Each school district that has 5.22agreed with its home county to delay the certification of its proposed property tax levy 5.23must certify its proposed property tax levy for the following year no later than October 5.247. The school district shall certify the proposed levy as:5.25    (1) a specific dollar amount by school district fund, broken down between 5.26voter-approved and non-voter-approved levies and between referendum market value 5.27and tax capacity levies; or5.28    (2) the maximum levy limitation certified by the commissioner of education 5.29according to section 
         126C.48, subdivision 1.5.30    (c) If the board of estimate and taxation or any similar board that establishes 5.31maximum tax levies for taxing jurisdictions within a first class city certifies the maximum 5.32property tax levies for funds under its jurisdiction by charter to the county auditor by 5.33September 15, the city shall be deemed to have certified its levies for those taxing 5.34jurisdictions.6.1    (d) For purposes of this section, "taxing authority" includes all home rule and 6.2statutory cities, towns, counties, school districts, and special taxing districts as defined 6.3in section 
         275.066. Intermediate school districts that levy a tax under chapter 124 or 6.4136D, joint powers boards established under sections 
         123A.44 to 
         123A.446, and Common 6.5School Districts No. 323, Franconia, and No. 815, Prinsburg, are also special taxing 6.6districts for purposes of this section.6.7(e) At the meeting at which the taxing authority, other than a town, adopts its 6.8proposed tax levy under paragraph (a) or (b), the taxing authority shall announce the 6.9time and place of its subsequent regularly scheduled meetings at which the budget and 6.10levy will be discussed and at which the public will be allowed to speak. The time and 6.11place of those meetingsThe following information must be included in the proceedings 6.12or summary of proceedings published in the official newspaper of the taxing authority 6.13under section 
         123B.09, 
         375.12, or 
         412.191:6.14(1) the time and place of the meetings described in this paragraph; and6.15(2) a statement that the budget information required to be reported under section 6.16471.703 is available on the county or city Web site, if there is one.6.17EFFECTIVE DATE.This section is effective July 1, 2012.6.18    Sec. 5. Minnesota Statutes 2010, section 275.065, subdivision 3, is amended to read:6.19    Subd. 3. Notice of proposed property taxes. (a) The county auditor shall prepare 6.20and the county treasurer shall deliver after November 10 and on or before November 24 6.21each year, by first class mail to each taxpayer at the address listed on the county's current 6.22year's assessment roll, a notice of proposed property taxes. Upon written request by 6.23the taxpayer, the treasurer may send the notice in electronic form or by electronic mail 6.24instead of on paper or by ordinary mail.6.25    (b) The commissioner of revenue shall prescribe the form of the notice.6.26    (c) The notice must inform taxpayers that it contains the amount of property taxes 6.27each taxing authority proposes to collect for taxes payable the following year. In the 6.28case of a town, or in the case of the state general tax, the final tax amount will be its 6.29proposed tax. The notice must clearly state for each city that has a population over 500, 6.30county, school district, regional library authority established under section 
         134.201, and 6.31metropolitan taxing districts as defined in paragraph (i), the time and place of a meeting 6.32for each taxing authority in which the budget and levy will be discussed and public input 6.33allowed, prior to the final budget and levy determination. The notice must clearly state 6.34for each county with a population of more than 5,000 and for each city with a population 6.35of more than 5,000 that the budget information required to be reported under section 7.1471.703 is available on the county or city Web site, if there is one. The taxing authorities 7.2must provide the county auditor with the information to be included in the notice on or 7.3before the time it certifies its proposed levy under subdivision 1. The public must be 7.4allowed to speak at that meeting, which must occur after November 24 and must not be 7.5held before 6:00 p.m. It must provide a telephone number for the taxing authority that 7.6taxpayers may call if they have questions related to the notice and an address where 7.7comments will be received by mail, except that no notice required under this section 7.8shall be interpreted as requiring the printing of a personal telephone number or address 7.9as the contact information for a taxing authority. If a taxing authority does not maintain 7.10public offices where telephone calls can be received by the authority, the authority may 7.11inform the county of the lack of a public telephone number and the county shall not list a 7.12telephone number for that taxing authority.7.13    (d) The notice must state for each parcel:7.14    (1) the market value of the property as determined under section 
         273.11, and used 7.15for computing property taxes payable in the following year and for taxes payable in the 7.16current year as each appears in the records of the county assessor on November 1 of the 7.17current year; and, in the case of residential property, whether the property is classified as 7.18homestead or nonhomestead. The notice must clearly inform taxpayers of the years to 7.19which the market values apply and that the values are final values;7.20    (2) the items listed below, shown separately by county, city or town, and state general 7.21tax, net of the residential and agricultural homestead credit under section 
         273.1384, voter 7.22approved school levy, other local school levy, and the sum of the special taxing districts, 7.23and as a total of all taxing authorities:7.24    (i) the actual tax for taxes payable in the current year; and7.25    (ii) the proposed tax amount.7.26    If the county levy under clause (2) includes an amount for a lake improvement 7.27district as defined under sections 
         103B.501 to 
         103B.581, the amount attributable for that 7.28purpose must be separately stated from the remaining county levy amount.7.29    In the case of a town or the state general tax, the final tax shall also be its proposed 7.30tax unless the town changes its levy at a special town meeting under section 
         365.52. If a 7.31school district has certified under section 
         126C.17, subdivision 9, that a referendum will 7.32be held in the school district at the November general election, the county auditor must 7.33note next to the school district's proposed amount that a referendum is pending and that, if 7.34approved by the voters, the tax amount may be higher than shown on the notice. In the 7.35case of the city of Minneapolis, the levy for Minneapolis Park and Recreation shall be 7.36listed separately from the remaining amount of the city's levy. In the case of the city of 8.1St. Paul, the levy for the St. Paul Library Agency must be listed separately from the 8.2remaining amount of the city's levy. In the case of Ramsey County, any amount levied 8.3under section 
         134.07 may be listed separately from the remaining amount of the county's 8.4levy. In the case of a parcel where tax increment or the fiscal disparities areawide tax 8.5under chapter 276A or 473F applies, the proposed tax levy on the captured value or the 8.6proposed tax levy on the tax capacity subject to the areawide tax must each be stated 8.7separately and not included in the sum of the special taxing districts; and8.8    (3) the increase or decrease between the total taxes payable in the current year and 8.9the total proposed taxes, expressed as a percentage.8.10    For purposes of this section, the amount of the tax on homesteads qualifying under 8.11the senior citizens' property tax deferral program under chapter 290B is the total amount 8.12of property tax before subtraction of the deferred property tax amount.8.13    (e) The notice must clearly state that the proposed or final taxes do not include 8.14the following:8.15    (1) special assessments;8.16    (2) levies approved by the voters after the date the proposed taxes are certified, 8.17including bond referenda and school district levy referenda;8.18    (3) a levy limit increase approved by the voters by the first Tuesday after the first 8.19Monday in November of the levy year as provided under section 
         275.73;8.20    (4) amounts necessary to pay cleanup or other costs due to a natural disaster 8.21occurring after the date the proposed taxes are certified;8.22    (5) amounts necessary to pay tort judgments against the taxing authority that become 8.23final after the date the proposed taxes are certified; and8.24    (6) the contamination tax imposed on properties which received market value 8.25reductions for contamination.8.26    (f) Except as provided in subdivision 7, failure of the county auditor to prepare or 8.27the county treasurer to deliver the notice as required in this section does not invalidate the 8.28proposed or final tax levy or the taxes payable pursuant to the tax levy.8.29    (g) If the notice the taxpayer receives under this section lists the property as 8.30nonhomestead, and satisfactory documentation is provided to the county assessor by the 8.31applicable deadline, and the property qualifies for the homestead classification in that 8.32assessment year, the assessor shall reclassify the property to homestead for taxes payable 8.33in the following year.8.34    (h) In the case of class 4 residential property used as a residence for lease or rental 8.35periods of 30 days or more, the taxpayer must either:9.1    (1) mail or deliver a copy of the notice of proposed property taxes to each tenant, 9.2renter, or lessee; or9.3    (2) post a copy of the notice in a conspicuous place on the premises of the property.9.4    The notice must be mailed or posted by the taxpayer by November 27 or within 9.5three days of receipt of the notice, whichever is later. A taxpayer may notify the county 9.6treasurer of the address of the taxpayer, agent, caretaker, or manager of the premises to 9.7which the notice must be mailed in order to fulfill the requirements of this paragraph.9.8    (i) For purposes of this subdivision and subdivision 6, "metropolitan special taxing 9.9districts" means the following taxing districts in the seven-county metropolitan area that 9.10levy a property tax for any of the specified purposes listed below:9.11    (1) Metropolitan Council under section 
         473.132, 
         473.167, 
         473.249, 
         473.325, 9.12473.446
         , 
         473.521, 
         473.547, or 
         473.834;9.13    (2) Metropolitan Airports Commission under section 
         473.667, 
         473.671, or 
         473.672; 9.14and9.15    (3) Metropolitan Mosquito Control Commission under section 
         473.711.9.16    For purposes of this section, any levies made by the regional rail authorities in the 9.17county of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter 9.18398A shall be included with the appropriate county's levy.9.19    (j) The governing body of a county, city, or school district may, with the consent 9.20of the county board, include supplemental information with the statement of proposed 9.21property taxes about the impact of state aid increases or decreases on property tax 9.22increases or decreases and on the level of services provided in the affected jurisdiction. 9.23This supplemental information may include information for the following year, the current 9.24year, and for as many consecutive preceding years as deemed appropriate by the governing 9.25body of the county, city, or school district. It may include only information regarding:9.26    (1) the impact of inflation as measured by the implicit price deflator for state and 9.27local government purchases;9.28    (2) population growth and decline;9.29    (3) state or federal government action; and9.30    (4) other financial factors that affect the level of property taxation and local services 9.31that the governing body of the county, city, or school district may deem appropriate to 9.32include.9.33    The information may be presented using tables, written narrative, and graphic 9.34representations and may contain instruction toward further sources of information or 9.35opportunity for comment.9.36EFFECTIVE DATE.This section is effective July 1, 2012.10.1    Sec. 6. Minnesota Statutes 2010, section 275.065, subdivision 3, is amended to read:10.2    Subd. 3. Notice of proposed property taxes. (a) The county auditor shall prepare 10.3and the county treasurer shall deliver after November 10 and on or before November 24 10.4each year, by first class mail to each taxpayer at the address listed on the county's current 10.5year's assessment roll, a notice of proposed property taxes. Upon written request by 10.6the taxpayer, the treasurer may send the notice in electronic form or by electronic mail 10.7instead of on paper or by ordinary mail.10.8    (b) The commissioner of revenue shall prescribe the form of the notice.10.9    (c) The notice must inform taxpayers that it contains the amount of property taxes 10.10each taxing authority proposes to collect for taxes payable the following year. In the 10.11case of a town, or in the case of the state general tax, the final tax amount will be its 10.12proposed tax. The notice must clearly state For each city that has a population over 500, 10.13county, school district, regional library authority established under section 
         134.201, and 10.14metropolitan taxing districts as defined in paragraph (i), the notice must state the time and 10.15place of a meeting for each taxing authority in which the budget and levy will be discussed 10.16and public input allowed, prior to the final budget and levy determination. For each special 10.17taxing district, the notice must: (1) list separately any levy by a special taxing district that 10.18exceeds 25 percent of the total of all special taxing district levies; and (2) provide county 10.19government contact information where additional information may be obtained for each 10.20special taxing district. The taxing authorities must provide the county auditor with the 10.21information to be included in the notice on or before the time it certifies its proposed 10.22levy under subdivision 1. The public must be allowed to speak at that meeting, which 10.23must occur after November 24 and must not be held before 6:00 p.m. It must provide a 10.24telephone number for the taxing authority that taxpayers may call if they have questions 10.25related to the notice and an address where comments will be received by mail, except that 10.26no notice required under this section shall be interpreted as requiring the printing of a 10.27personal telephone number or address as the contact information for a taxing authority. If 10.28a taxing authority does not maintain public offices where telephone calls can be received 10.29by the authority, the authority may inform the county of the lack of a public telephone 10.30number and the county shall not list a telephone number for that taxing authority.10.31    (d) The notice must state for each parcel:10.32    (1) the market value of the property as determined under section 
         273.11, and used 10.33for computing property taxes payable in the following year and for taxes payable in the 10.34current year as each appears in the records of the county assessor on November 1 of the 10.35current year; and, in the case of residential property, whether the property is classified as 11.1homestead or nonhomestead. The notice must clearly inform taxpayers of the years to 11.2which the market values apply and that the values are final values;11.3    (2) the items listed below, shown separately by county, city or town, and state 11.4general tax, net of the residential and agricultural homestead credit under section 11.5273.1384
         , voter approved school levy, other local school levy, and the sum of the each11.6special taxing districts district, provided that the levies of all special taxing districts whose 11.7levies do not exceed 25 percent of the total amount of all special taxing district levies may 11.8be aggregated, and as a total of for all taxing authorities:11.9    (i) the actual tax for taxes payable in the current year; and11.10    (ii) the proposed tax amount.11.11    If the county levy under clause (2) includes an amount for a lake improvement 11.12district as defined under sections 
         103B.501 to 
         103B.581, the amount attributable for that 11.13purpose must be separately stated from the remaining county levy amount.11.14    In the case of a town or the state general tax, the final tax shall also be its proposed 11.15tax unless the town changes its levy at a special town meeting under section 
         365.52. If a 11.16school district has certified under section 
         126C.17, subdivision 9, that a referendum will 11.17be held in the school district at the November general election, the county auditor must 11.18note next to the school district's proposed amount that a referendum is pending and that, if 11.19approved by the voters, the tax amount may be higher than shown on the notice. In the 11.20case of the city of Minneapolis, the levy for Minneapolis Park and Recreation shall be 11.21listed separately from the remaining amount of the city's levy. In the case of the city of 11.22St. Paul, the levy for the St. Paul Library Agency must be listed separately from the 11.23remaining amount of the city's levy. In the case of Ramsey County, any amount levied 11.24under section 
         134.07 may be listed separately from the remaining amount of the county's 11.25levy. In the case of a parcel where tax increment or the fiscal disparities areawide tax 11.26under chapter 276A or 473F applies, the proposed tax levy on the captured value or the 11.27proposed tax levy on the tax capacity subject to the areawide tax must each be stated 11.28separately and not included in the sum of the special taxing districts; and11.29    (3) the increase or decrease between the total taxes payable in the current year and 11.30the total proposed taxes, expressed as a percentage.11.31    For purposes of this section, the amount of the tax on homesteads qualifying under 11.32the senior citizens' property tax deferral program under chapter 290B is the total amount 11.33of property tax before subtraction of the deferred property tax amount.11.34    (e) The notice must clearly state that the proposed or final taxes do not include 11.35the following:11.36    (1) special assessments;12.1    (2) levies approved by the voters after the date the proposed taxes are certified, 12.2including bond referenda and school district levy referenda;12.3    (3) a levy limit increase approved by the voters by the first Tuesday after the first 12.4Monday in November of the levy year as provided under section 
         275.73;12.5    (4) amounts necessary to pay cleanup or other costs due to a natural disaster 12.6occurring after the date the proposed taxes are certified;12.7    (5) amounts necessary to pay tort judgments against the taxing authority that become 12.8final after the date the proposed taxes are certified; and12.9    (6) the contamination tax imposed on properties which received market value 12.10reductions for contamination.12.11    (f) Except as provided in subdivision 7, failure of the county auditor to prepare or 12.12the county treasurer to deliver the notice as required in this section does not invalidate the 12.13proposed or final tax levy or the taxes payable pursuant to the tax levy.12.14    (g) If the notice the taxpayer receives under this section lists the property as 12.15nonhomestead, and satisfactory documentation is provided to the county assessor by the 12.16applicable deadline, and the property qualifies for the homestead classification in that 12.17assessment year, the assessor shall reclassify the property to homestead for taxes payable 12.18in the following year.12.19    (h) In the case of class 4 residential property used as a residence for lease or rental 12.20periods of 30 days or more, the taxpayer must either:12.21    (1) mail or deliver a copy of the notice of proposed property taxes to each tenant, 12.22renter, or lessee; or12.23    (2) post a copy of the notice in a conspicuous place on the premises of the property.12.24    The notice must be mailed or posted by the taxpayer by November 27 or within 12.25three days of receipt of the notice, whichever is later. A taxpayer may notify the county 12.26treasurer of the address of the taxpayer, agent, caretaker, or manager of the premises to 12.27which the notice must be mailed in order to fulfill the requirements of this paragraph.12.28    (i) For purposes of this subdivision and subdivision 6, "metropolitan special taxing 12.29districts" means the following taxing districts in the seven-county metropolitan area that 12.30levy a property tax for any of the specified purposes listed below:12.31    (1) Metropolitan Council under section 
         473.132, 
         473.167, 
         473.249, 
         473.325, 12.32473.446
         , 
         473.521, 
         473.547, or 
         473.834;12.33    (2) Metropolitan Airports Commission under section 
         473.667, 
         473.671, or 
         473.672; 12.34and12.35    (3) Metropolitan Mosquito Control Commission under section 
         473.711.13.1    For purposes of this section, any levies made by the regional rail authorities in the 13.2county of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter 13.3398A shall be included with the appropriate county's levy.13.4    (j) The governing body of a county, city, or school district may, with the consent 13.5of the county board, include supplemental information with the statement of proposed 13.6property taxes about the impact of state aid increases or decreases on property tax 13.7increases or decreases and on the level of services provided in the affected jurisdiction. 13.8This supplemental information may include information for the following year, the current 13.9year, and for as many consecutive preceding years as deemed appropriate by the governing 13.10body of the county, city, or school district. It may include only information regarding:13.11    (1) the impact of inflation as measured by the implicit price deflator for state and 13.12local government purchases;13.13    (2) population growth and decline;13.14    (3) state or federal government action; and13.15    (4) other financial factors that affect the level of property taxation and local services 13.16that the governing body of the county, city, or school district may deem appropriate to 13.17include.13.18    The information may be presented using tables, written narrative, and graphic 13.19representations and may contain instruction toward further sources of information or 13.20opportunity for comment.13.21EFFECTIVE DATE.This section is effective for tax statements relating to taxes 13.22payable in 2014 and thereafter.13.23    Sec. 7. Minnesota Statutes 2011 Supplement, section 276.04, subdivision 2, is 13.24amended to read:13.25    Subd. 2. Contents of tax statements. (a) The treasurer shall provide for the 13.26printing of the tax statements. The commissioner of revenue shall prescribe the form of 13.27the property tax statement and its contents. The tax statement must not state or imply 13.28that property tax credits are paid by the state of Minnesota. The statement must contain 13.29a tabulated statement of the dollar amount due to each taxing authority and the amount 13.30of the state tax from the parcel of real property for which a particular tax statement is 13.31prepared. The dollar amounts attributable to the county, the state tax, the voter approved 13.32school tax, the other local school tax, the township or municipality, and the total of 13.33the metropolitan special taxing districts as defined in section 
         275.065, subdivision 3, 13.34paragraph (i), must be separately stated. The amounts due all other special taxing districts, 13.35if any, may be aggregated except that (1) any levies made by the regional rail authorities 14.1in the county of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under 14.2chapter 398A shall be listed on a separate line directly under the appropriate county's 14.3levy, and (2) any levy by a special taxing district that exceeds 25 percent of the total of all 14.4special taxing district levies on a tax statement must be separately stated. If the county 14.5levy under this paragraph includes an amount for a lake improvement district as defined 14.6under sections 
         103B.501 to 
         103B.581, the amount attributable for that purpose must be 14.7separately stated from the remaining county levy amount. In the case of Ramsey County, 14.8if the county levy under this paragraph includes an amount for public library service 14.9under section 
         134.07, the amount attributable for that purpose may be separated from the 14.10remaining county levy amount. The amount of the tax on homesteads qualifying under the 14.11senior citizens' property tax deferral program under chapter 290B is the total amount of 14.12property tax before subtraction of the deferred property tax amount. The amount of the 14.13tax on contamination value imposed under sections 
         270.91 to 
         270.98, if any, must also 14.14be separately stated. The dollar amounts, including the dollar amount of any special 14.15assessments, may be rounded to the nearest even whole dollar. For purposes of this section 14.16whole odd-numbered dollars may be adjusted to the next higher even-numbered dollar. 14.17The amount of market value excluded under section 
         273.11, subdivision 16, if any, must 14.18also be listed on the tax statement.14.19    (b) The property tax statements for manufactured homes and sectional structures 14.20taxed as personal property shall contain the same information that is required on the 14.21tax statements for real property.14.22    (c) Real and personal property tax statements must contain the following information 14.23in the order given in this paragraph. The information must contain the current year tax 14.24information in the right column with the corresponding information for the previous year 14.25in a column on the left:14.26    (1) the property's estimated market value under section 
         273.11, subdivision 1;14.27(2) the property's homestead market value exclusion under section 
         273.13, 14.28subdivision 35;14.29    (3) the property's taxable market value after reductions under sections 
         273.11, 14.30subdivisions 1a and 16, and 
         273.13, subdivision 35;14.31    (4) the property's gross tax, before credits;14.32    (5) for homestead agricultural properties, the credit under section 
         273.1384;14.33    (6) any credits received under sections 
         273.119; 
         273.1234 or 
         273.1235; 
         273.135; 14.34273.1391
         ; 
         273.1398, subdivision 4; 
         469.171; and 
         473H.10, except that the amount of 14.35credit received under section 
         273.135 must be separately stated and identified as "taconite 14.36tax relief"; and15.1    (7) the net tax payable in the manner required in paragraph (a).15.2    (d) If the county uses envelopes for mailing property tax statements and if the county 15.3agrees, a taxing district may include a notice with the property tax statement notifying 15.4taxpayers when the taxing district will begin its budget deliberations for the current 15.5year, and encouraging taxpayers to attend the hearings. If the county allows notices to 15.6be included in the envelope containing the property tax statement, and if more than 15.7one taxing district relative to a given property decides to include a notice with the tax 15.8statement, the county treasurer or auditor must coordinate the process and may combine 15.9the information on a single announcement.15.10EFFECTIVE DATE.This section is effective for tax statements relating to taxes 15.11payable in 2014 and thereafter.15.12    Sec. 8. Minnesota Statutes 2010, section 290A.04, subdivision 2h, is amended to read:15.13    Subd. 2h. Additional refund. (a) If the gross property taxes payable on a homestead 15.14increase more than 12 percent over the property taxes payable in the prior year on the same 15.15property that is owned and occupied by the same owner on January 2 of both years, and the 15.16amount of that increase is $100 or more, a claimant who is a homeowner shall be allowed 15.17an additional refund equal to 60 75 percent of the amount of the increase over the greater 15.18of 12 percent of the prior year's property taxes payable or $100. This subdivision shall not 15.19apply to any increase in the gross property taxes payable attributable to improvements 15.20made to the homestead after the assessment date for the prior year's taxes. This subdivision 15.21shall not apply to any increase in the gross property taxes payable attributable to the 15.22termination of valuation exclusions under section 
         273.11, subdivision 16.15.23The maximum refund allowed under this subdivision is $1,000.15.24(b) For purposes of this subdivision "gross property taxes payable" means property 15.25taxes payable determined without regard to the refund allowed under this subdivision.15.26(c) In addition to the other proofs required by this chapter, each claimant under 15.27this subdivision shall file with the property tax refund return a copy of the property tax 15.28statement for taxes payable in the preceding year or other documents required by the 15.29commissioner.15.30(d) Upon request, the appropriate county official shall make available the names and 15.31addresses of the property taxpayers who may be eligible for the additional property tax 15.32refund under this section. The information shall be provided on a magnetic computer 15.33disk. The county may recover its costs by charging the person requesting the information 15.34the reasonable cost for preparing the data. The information may not be used for any 16.1purpose other than for notifying the homeowner of potential eligibility and assisting the 16.2homeowner, without charge, in preparing a refund claim.16.3EFFECTIVE DATE.This section is effective beginning with refunds based on 16.4taxes payable in 2013.16.5    Sec. 9. [471.703] EXPENDITURE TYPE REPORTING.16.6    Subdivision 1.Purpose.In order to facilitate involvement of the public in local 16.7government budgeting, municipalities shall provide the following budgetary information 16.8on a municipal Web site, except as provided in subdivision 4, and publicize the availability 16.9of this information as part of the property tax and budget notices required in section 16.10275.065.16.11    Subd. 2.Definitions.(a) For purposes of this section, the following terms have the 16.12meanings given in this subdivision.16.13(b) "Municipality" means a county with a population of more than 5,000 or a home 16.14rule charter or statutory city with a population of more than 5,000.16.15(c) "Population" means the population of the municipality as established by the last 16.16federal census, by a special census conducted under contract with the United States Bureau 16.17of the Census, by a population estimate made by the Metropolitan Council pursuant to 16.18section 473.24, or by a population estimate of the state demographer made pursuant to 16.19section 4A.02, whichever is the most recent as to the stated date of the count or estimate for 16.20the preceding calendar year, and which has been certified to the commissioner of revenue 16.21on or before July 15 of the year in which the information is required to be reported.16.22    Subd. 3.Electronic budgetary information.(a) By July 31 of each year, a 16.23municipality shall publish on its Web site, except as provided in subdivision 4, four years 16.24of budget information on both revenues and expenditures organized by function and by 16.25expenditure type. The four years shall include actual data from the three most recently 16.26concluded budget years and estimated data for the current budget year.16.27(b) The governmental funds included in the budget information required under 16.28this section shall include the municipality's general fund, debt service fund, and special 16.29revenue funds, except for special revenue funds specifically used for the acquisition and 16.30construction of major capital facilities. The reported information shall also exclude 16.31enterprise funds and fiduciary funds.16.32(c) The forms and reporting requirements for revenues and expenditures by function 16.33shall be established by the state auditor's office and shall be based on the revenue and 16.34expenditure breakdowns used by that office in the five-year summary tables for annual 17.1revenue, expenditure, and debt reports for counties and cities with a population over 17.22,500, under section 6.75.17.3(d) The forms and reporting requirements for expenditures by expenditure type shall 17.4be established by the state auditor's office and at minimum shall include the following line 17.5items: employee costs, purchased services, supplies, central services, capital items, debt 17.6service, transfer to other funds, and miscellaneous; with employee costs further subdivided 17.7into the following items: wages and salaries, pensions, Social Security, health care, and 17.8other benefits. The state auditor shall consult with the commissioner of management and 17.9budget, city and county representatives, and members of the governmental accounting 17.10community in developing the definition of expenditure types for reporting purposes.17.11    Subd. 4.Alternative publication of budgetary information.A municipality 17.12that does not maintain an official Web site must either (1) set up a separate Web site to 17.13make accessible the budgetary information as required in subdivision 3, or (2) publish the 17.14same information required in subdivision 3 by August 31 of each year in one issue of the 17.15official newspaper of the municipality. If a county publishes the information in its official 17.16newspaper it must also publish the same information in one other newspaper, if one of 17.17general circulation is located in a different city in the county than the official newspaper. 17.18The state auditor must prescribe the form for the newspaper notice.17.19    Subd. 5.Incentives.In 2012 only, a city or county that complies with the 17.20requirement of this section and section 6.91, subdivision 1, shall receive the benefits 17.21pursuant to section 6.91, subdivision 2.17.22    Subd. 6.Penalties.In 2013 and thereafter, failure of a municipality to provide 17.23the information required in this section shall result in the withholding of aids payable 17.24the following calendar year under sections 162.01 to 162.14, 423A.02, and 477A.011 17.25to 477A.014.17.26EFFECTIVE DATE.This section is effective July 1, 2012.17.27    Sec. 10. Minnesota Statutes 2010, section 477A.011, subdivision 36, is amended to 17.28read:17.29    Subd. 36. City aid base. (a) Except as otherwise provided in this subdivision, 17.30"city aid base" is zero.17.31    (b) The city aid base for any city with a population less than 500 is increased by 17.32$40,000 for aids payable in calendar year 1995 and thereafter, and the maximum amount 17.33of total aid it may receive under section 
         477A.013, subdivision 9, paragraph (c), is also 17.34increased by $40,000 for aids payable in calendar year 1995 only, provided that:17.35    (i) the average total tax capacity rate for taxes payable in 1995 exceeds 200 percent;18.1    (ii) the city portion of the tax capacity rate exceeds 100 percent; and18.2    (iii) its city aid base is less than $60 per capita.18.3    (c) The city aid base for a city is increased by $20,000 in 1998 and thereafter and 18.4the maximum amount of total aid it may receive under section 
         477A.013, subdivision 9, 18.5paragraph (c), is also increased by $20,000 in calendar year 1998 only, provided that:18.6    (i) the city has a population in 1994 of 2,500 or more;18.7    (ii) the city is located in a county, outside of the metropolitan area, which contains a 18.8city of the first class;18.9    (iii) the city's net tax capacity used in calculating its 1996 aid under section 18.10477A.013
          is less than $400 per capita; and18.11    (iv) at least four percent of the total net tax capacity, for taxes payable in 1996, of 18.12property located in the city is classified as railroad property.18.13    (d) The city aid base for a city is increased by $200,000 in 1999 and thereafter and 18.14the maximum amount of total aid it may receive under section 
         477A.013, subdivision 9, 18.15paragraph (c), is also increased by $200,000 in calendar year 1999 only, provided that:18.16    (i) the city was incorporated as a statutory city after December 1, 1993;18.17    (ii) its city aid base does not exceed $5,600; and18.18    (iii) the city had a population in 1996 of 5,000 or more.18.19    (e) The city aid base for a city is increased by $150,000 for aids payable in 2000 and 18.20thereafter, and the maximum amount of total aid it may receive under section 
         477A.013, 18.21subdivision 9
         , paragraph (c), is also increased by $150,000 in calendar year 2000 only, 18.22provided that:18.23    (1) the city has a population that is greater than 1,000 and less than 2,500;18.24    (2) its commercial and industrial percentage for aids payable in 1999 is greater 18.25than 45 percent; and18.26    (3) the total market value of all commercial and industrial property in the city 18.27for assessment year 1999 is at least 15 percent less than the total market value of all 18.28commercial and industrial property in the city for assessment year 1998.18.29    (f) The city aid base for a city is increased by $200,000 in 2000 and thereafter, and 18.30the maximum amount of total aid it may receive under section 
         477A.013, subdivision 9, 18.31paragraph (c), is also increased by $200,000 in calendar year 2000 only, provided that:18.32    (1) the city had a population in 1997 of 2,500 or more;18.33    (2) the net tax capacity of the city used in calculating its 1999 aid under section 18.34477A.013
          is less than $650 per capita;18.35    (3) the pre-1940 housing percentage of the city used in calculating 1999 aid under 18.36section 
         477A.013 is greater than 12 percent;19.1    (4) the 1999 local government aid of the city under section 
         477A.013 is less than 19.220 percent of the amount that the formula aid of the city would have been if the need 19.3increase percentage was 100 percent; and19.4    (5) the city aid base of the city used in calculating aid under section 
         477A.013 19.5is less than $7 per capita.19.6    (g) The city aid base for a city is increased by $102,000 in 2000 and thereafter, and 19.7the maximum amount of total aid it may receive under section 
         477A.013, subdivision 9, 19.8paragraph (c), is also increased by $102,000 in calendar year 2000 only, provided that:19.9    (1) the city has a population in 1997 of 2,000 or more;19.10    (2) the net tax capacity of the city used in calculating its 1999 aid under section 19.11477A.013
          is less than $455 per capita;19.12    (3) the net levy of the city used in calculating 1999 aid under section 
         477A.013 is 19.13greater than $195 per capita; and19.14    (4) the 1999 local government aid of the city under section 
         477A.013 is less than 19.1538 percent of the amount that the formula aid of the city would have been if the need 19.16increase percentage was 100 percent.19.17    (h) The city aid base for a city is increased by $32,000 in 2001 and thereafter, and 19.18the maximum amount of total aid it may receive under section 
         477A.013, subdivision 9, 19.19paragraph (c), is also increased by $32,000 in calendar year 2001 only, provided that:19.20    (1) the city has a population in 1998 that is greater than 200 but less than 500;19.21    (2) the city's revenue need used in calculating aids payable in 2000 was greater 19.22than $200 per capita;19.23    (3) the city net tax capacity for the city used in calculating aids available in 2000 19.24was equal to or less than $200 per capita;19.25    (4) the city aid base of the city used in calculating aid under section 
         477A.013 19.26is less than $65 per capita; and19.27    (5) the city's formula aid for aids payable in 2000 was greater than zero.19.28    (i) The city aid base for a city is increased by $7,200 in 2001 and thereafter, and 19.29the maximum amount of total aid it may receive under section 
         477A.013, subdivision 9, 19.30paragraph (c), is also increased by $7,200 in calendar year 2001 only, provided that:19.31    (1) the city had a population in 1998 that is greater than 200 but less than 500;19.32    (2) the city's commercial industrial percentage used in calculating aids payable in 19.332000 was less than ten percent;19.34    (3) more than 25 percent of the city's population was 60 years old or older according 19.35to the 1990 census;20.1    (4) the city aid base of the city used in calculating aid under section 
         477A.013 20.2is less than $15 per capita; and20.3    (5) the city's formula aid for aids payable in 2000 was greater than zero.20.4    (j) The city aid base for a city is increased by $45,000 in 2001 and thereafter and 20.5by an additional $50,000 in calendar years 2002 to 2011, and the maximum amount of 20.6total aid it may receive under section 
         477A.013, subdivision 9, paragraph (c), is also 20.7increased by $45,000 in calendar year 2001 only, and by $50,000 in calendar year 2002 20.8only, provided that:20.9    (1) the net tax capacity of the city used in calculating its 2000 aid under section 20.10477A.013
          is less than $810 per capita;20.11    (2) the population of the city declined more than two percent between 1988 and 1998;20.12    (3) the net levy of the city used in calculating 2000 aid under section 
         477A.013 is 20.13greater than $240 per capita; and20.14    (4) the city received less than $36 per capita in aid under section 
         477A.013, 20.15subdivision 9
         , for aids payable in 2000.20.16    (k) The city aid base for a city with a population of 10,000 or more which is located 20.17outside of the seven-county metropolitan area is increased in 2002 and thereafter, and the 20.18maximum amount of total aid it may receive under section 
         477A.013, subdivision 9, 20.19paragraph (b) or (c), is also increased in calendar year 2002 only, by an amount equal to 20.20the lesser of:20.21    (1)(i) the total population of the city, as determined by the United States Bureau of 20.22the Census, in the 2000 census, (ii) minus 5,000, (iii) times 60; or20.23    (2) $2,500,000.20.24    (l) The city aid base is increased by $50,000 in 2002 and thereafter, and the 20.25maximum amount of total aid it may receive under section 
         477A.013, subdivision 9, 20.26paragraph (c), is also increased by $50,000 in calendar year 2002 only, provided that:20.27    (1) the city is located in the seven-county metropolitan area;20.28    (2) its population in 2000 is between 10,000 and 20,000; and20.29    (3) its commercial industrial percentage, as calculated for city aid payable in 2001, 20.30was greater than 25 percent.20.31    (m) The city aid base for a city is increased by $150,000 in calendar years 2002 to 20.322011 and by an additional $75,000 in calendar years 2009 to 2014 and the maximum 20.33amount of total aid it may receive under section 
         477A.013, subdivision 9, paragraph (c), is 20.34also increased by $150,000 in calendar year 2002 only and by $75,000 in calendar year 20.352009 only, provided that:20.36    (1) the city had a population of at least 3,000 but no more than 4,000 in 1999;21.1    (2) its home county is located within the seven-county metropolitan area;21.2    (3) its pre-1940 housing percentage is less than 15 percent; and21.3    (4) its city net tax capacity per capita for taxes payable in 2000 is less than $900 21.4per capita.21.5    (n) The city aid base for a city is increased by $200,000 beginning in calendar 21.6year 2003 and the maximum amount of total aid it may receive under section 
         477A.013, 21.7subdivision 9
         , paragraph (c), is also increased by $200,000 in calendar year 2003 only, 21.8provided that the city qualified for an increase in homestead and agricultural credit aid 21.9under Laws 1995, chapter 264, article 8, section 18.21.10    (o) The city aid base for a city is increased by $200,000 in 2004 only and the 21.11maximum amount of total aid it may receive under section 
         477A.013, subdivision 9, is 21.12also increased by $200,000 in calendar year 2004 only, if the city is the site of a nuclear 21.13dry cask storage facility.21.14    (p) The city aid base for a city is increased by $10,000 in 2004 and thereafter and the 21.15maximum total aid it may receive under section 
         477A.013, subdivision 9, is also increased 21.16by $10,000 in calendar year 2004 only, if the city was included in a federal major disaster 21.17designation issued on April 1, 1998, and its pre-1940 housing stock was decreased by 21.18more than 40 percent between 1990 and 2000.21.19    (q) The city aid base for a city is increased by $30,000 in 2009 and thereafter and the 21.20maximum total aid it may receive under section 
         477A.013, subdivision 9, is also increased 21.21by $25,000 in calendar year 2006 only if the city had a population in 2003 of at least 1,000 21.22and has a state park for which the city provides rescue services and which comprised at 21.23least 14 percent of the total geographic area included within the city boundaries in 2000.21.24    (r) The city aid base for a city is increased by $80,000 in 2009 and thereafter and 21.25the minimum and maximum amount of total aid it may receive under section 
         477A.013, 21.26subdivision 9, is also increased by $80,000 in calendar year 2009 only, if:21.27    (1) as of May 1, 2006, at least 25 percent of the tax capacity of the city is proposed 21.28to be placed in trust status as tax-exempt Indian land;21.29    (2) the placement of the land is being challenged administratively or in court; and21.30    (3) due to the challenge, the land proposed to be placed in trust is still on the tax 21.31rolls as of May 1, 2006.21.32    (s) The city aid base for a city is increased by $100,000 in 2007 and thereafter and 21.33the minimum and maximum total amount of aid it may receive under this section is also 21.34increased in calendar year 2007 only, provided that:21.35    (1) the city has a 2004 estimated population greater than 200 but less than 2,000;21.36    (2) its city net tax capacity for aids payable in 2006 was less than $300 per capita;22.1    (3) the ratio of its pay 2005 tax levy compared to its city net tax capacity for aids 22.2payable in 2006 was greater than 110 percent; and22.3    (4) it is located in a county where at least 15,000 acres of land are classified as 22.4tax-exempt Indian reservations according to the 2004 abstract of tax-exempt property.22.5    (t) The city aid base for a city is increased by $30,000 in 2009 only, and the 22.6maximum total aid it may receive under section 
         477A.013, subdivision 9, is also increased 22.7by $30,000 in calendar year 2009, only if the city had a population in 2005 of less than 22.83,000 and the city's boundaries as of 2007 were formed by the consolidation of two cities 22.9and one township in 2002.22.10    (u) The city aid base for a city is increased by $100,000 in 2009 and thereafter, and 22.11the maximum total aid it may receive under section 
         477A.013, subdivision 9, is also 22.12increased by $100,000 in calendar year 2009 only, if the city had a city net tax capacity for 22.13aids payable in 2007 of less than $150 per capita and the city experienced flooding on 22.14March 14, 2007, that resulted in evacuation of at least 40 homes.22.15    (v) The city aid base for a city is increased by $100,000 in 2009 to 2013, and the 22.16maximum total aid it may receive under section 
         477A.013, subdivision 9, is also increased 22.17by $100,000 in calendar year 2009 only, if the city:22.18    (1) is located outside of the Minneapolis-St. Paul standard metropolitan statistical 22.19area;22.20    (2) has a 2005 population greater than 7,000 but less than 8,000; and22.21    (3) has a 2005 net tax capacity per capita of less than $500.22.22    (w) The city aid base is increased by $25,000 in calendar years 2009 to 2013 and the 22.23maximum amount of total aid it may receive under section 
         477A.013, subdivision 9, is 22.24increased by $25,000 in calendar year 2009 only, provided that:22.25    (1) the city is located in the seven-county metropolitan area;22.26    (2) its population in 2006 is less than 200; and22.27    (3) the percentage of its housing stock built before 1940, according to the 2000 22.28United States Census, is greater than 40 percent.22.29    (x) The city aid base is increased by $90,000 in calendar year 2009 only and the 22.30minimum and maximum total amount of aid it may receive under section 
         477A.013, 22.31subdivision 9, is also increased by $90,000 in calendar year 2009 only, provided that the 22.32city is located in the seven-county metropolitan area, has a 2006 population between 5,000 22.33and 7,000 and has a 1997 population of over 7,000.22.34    (y) In calendar year 2010 only, the city aid base for a city is increased by $225,000 if 22.35it was eligible for a $450,000 payment in calendar year 2008 under Minnesota Statutes 22.362006, section 
         477A.011, subdivision 36, paragraph (e), and the second half of the payment 23.1under that paragraph in December 2008 was canceled due to the governor's unallotment. 23.2The payment under this paragraph is not subject to any aid reductions under section 23.3477A.0134
          or any future unallotment of the city aid under section 
         16A.152.23.4(z) The city aid base and the maximum total aid the city may receive under section 23.5477A.013, subdivision 9, is increased by $25,000 in calendar year 2010 only if:23.6(1) the city is a first class city in the seven-county metropolitan area with a 23.7population below 300,000; and23.8(2) the city has made an equivalent grant to its local growers' association to 23.9reimburse up to $1,000 each for membership fees and retail leases for members of the 23.10association who farm in and around Dakota County and who incurred crop damage as a 23.11result of the hail storm in that area on July 10, 2008.23.12The payment under this paragraph is not subject to any aid reductions under section 23.13477A.0134 or any future unallotment of the city aid under section 16A.152.23.14(aa) The city aid base for a city is increased by $106,964 in 2011 only and the 23.15minimum and maximum amount of total aid it may receive under section 477A.013, 23.16subdivision 9, is also increased by $106,964 in calendar year 2011 only, if the city had a 23.17population as defined in Minnesota Statutes, section 477A.011, subdivision 3, that was in 23.18excess of 1,000 in 2007 and that was less than 1,000 in 2008.23.19(z) In calendar year 2013 only, the total aid the city may receive under section 23.20477A.013 is increased by $12,000 if:23.21(1) the city's 2010 population is less than 100 and its population growth between 23.222000 and 2010 was more than 55 percent; and23.23(2) its commercial industrial percentage as defined in subdivision 32, based on 23.24assessments for calendar year 2010, payable in 2011, is greater than 15 percent.23.25EFFECTIVE DATE.This section is effective for aids payable in calendar year 23.262013 and thereafter.23.27    Sec. 11. Minnesota Statutes 2011 Supplement, section 477A.013, subdivision 9, 23.28is amended to read:23.29    Subd. 9. City aid distribution. (a) In calendar year 2009 2013 and thereafter, each 23.30city shall receive an aid distribution equal to the sum of (1) the city formula aid under 23.31subdivision 8, and (2) its city aid base.23.32    (b) For aids payable in 2013  and 2014 only, the total aid in the previous year for any 23.33city shall mean the amount of aid it was certified to receive for aids payable in 2012 under 23.34this section. For aids payable in 2014 2015 and thereafter, the total aid in the previous 24.1year for any city means the amount of aid it was certified to receive under this section in 24.2the previous payable year.24.3    (c) For aids payable in 2010 and thereafter, the total aid for any city shall not exceed 24.4the sum of (1) ten percent of the city's net levy for the year prior to the aid distribution 24.5plus (2) its total aid in the previous year. For aids payable in 2009 and thereafter, the total 24.6aid for any city with a population of 2,500 or more may not be less than its total aid under 24.7this section in the previous year minus the lesser of $10 multiplied by its population, or ten 24.8percent of its net levy in the year prior to the aid distribution.24.9    (d) For aids payable in 2010 and thereafter, the total aid for a city with a population 24.10less than 2,500 must not be less than the amount it was certified to receive in the 24.11previous year minus the lesser of $10 multiplied by its population, or five percent of its 24.122003 certified aid amount. For aids payable in 2009 only, the total aid for a city with a 24.13population less than 2,500 must not be less than what it received under this section in the 24.14previous year unless its total aid in calendar year 2008 was aid under section 
         477A.011, 24.15subdivision 36, paragraph (s), in which case its minimum aid is zero.24.16    (e) A city's aid loss under this section may not exceed $300,000 in any year in 24.17which the total city aid appropriation under section 
         477A.03, subdivision 2a, is equal or 24.18greater than the appropriation under that subdivision in the previous year, unless the 24.19city has an adjustment in its city net tax capacity under the process described in section 24.20469.174, subdivision 28
         .24.21    (f) If a city's net tax capacity used in calculating aid under this section has decreased 24.22in any year by more than 25 percent from its net tax capacity in the previous year due to 24.23property becoming tax-exempt Indian land, the city's maximum allowed aid increase 24.24under paragraph (c) shall be increased by an amount equal to (1) the city's tax rate in the 24.25year of the aid calculation, multiplied by (2) the amount of its net tax capacity decrease 24.26resulting from the property becoming tax exempt.24.27EFFECTIVE DATE.This section is effective for aids payable in calendar year 24.282013 and thereafter.24.29    Sec. 12. Minnesota Statutes 2010, section 477A.013, is amended by adding a 24.30subdivision to read:24.31    Subd. 12.Aid payments in 2013.(a) Notwithstanding aids calculated for 2013 24.32under subdivision 9, for 2013, each city with a population of 5,000 or more shall receive 24.33an aid distribution under this section equal to its aid distribution under this section in 2012.24.34(b) Notwithstanding aids calculated for 2013 under subdivision 9, each city with 24.35a population under 5,000 shall receive an aid distribution under this section equal to 25.1any additional city aid base authorized in calendar year 2013 under section 477A.011, 25.2subdivision 36, paragraph (z), plus the greater of (1) its aid distribution under this section 25.3in 2012 or (2) its amount that it is calculated to receive under subdivision 9.25.4EFFECTIVE DATE.This section is effective for aids payable in calendar year 25.52013.25.6    Sec. 13. Minnesota Statutes 2010, section 477A.017, subdivision 3, is amended to read:25.7    Subd. 3. Conformity. Other law to the contrary notwithstanding, in order to receive 25.8distributions under sections 
         477A.011 to 
         477A.03, counties and cities must conform to 25.9the standards set in subdivision 2 in making all financial reports required to be made to 25.10the state auditor after June 30, 1984 by the deadline set by the state auditor. Counties and 25.11cities that fail to submit the required information to the state auditor within 45 days of 25.12the reporting deadline shall forfeit an amount equal to ten percent of the distributions 25.13under sections 477A.011 to 477A.03. Counties and cities that fail to submit the required 25.14information within 60 days of the reporting deadline shall forfeit an amount equal to 30 25.15percent of the distributions. Counties and cities that fail to submit the required information 25.16within 90 days of the reporting deadline shall forfeit an amount equal to 50 percent of the 25.17distributions.25.18EFFECTIVE DATE.This section is effective for financial reports for calendar 25.19year 2012 and thereafter.25.20    Sec. 14. 2011 CITY AID PENALTIES.25.21(a) Notwithstanding Minnesota Statutes, section 477A.017, subdivision 3, any city 25.22that did not meet the requirements for filing calendar year 2010 financial reports with 25.23the state auditor imposed under Minnesota Statutes, section 477A.017, subdivision 2, 25.24shall receive its 2011 aid payment as calculated pursuant to Minnesota Statutes, section 25.25477A.013, subdivision 11, provided that the forms are submitted to the state auditor by 25.26May 31, 2012. The commissioner shall make payment to each qualifying city no later 25.27than June 30, 2012.25.28(b) Up to $794,579 of the fiscal year 2012 appropriation for local government aid 25.29in Minnesota Statutes, section 477A.013, subdivision 11, is available for the payment 25.30under this section.25.31EFFECTIVE DATE.This section is effective the day following final enactment.26.1    Sec. 15. Laws 1988, chapter 645, section 3, as amended by Laws 1999, chapter 243, 26.2article 6, section 9, Laws 2000, chapter 490, article 6, section 15, and Laws 2008, chapter 26.3154, article 2, section 30, is amended to read:26.4    Sec. 3. TAX; PAYMENT OF EXPENSES.26.5    (a) The tax levied by the hospital district under Minnesota Statutes, section 
         447.34, 26.6must not be levied at a rate that exceeds the amount authorized to be levied under that 26.7section. The proceeds of the tax may be used for all purposes of the hospital district, 26.8except as provided in paragraph (b).26.9    (b) 0.015 percent of taxable market value of the tax in paragraph (a) may be used 26.10solely by the Cook ambulance service and the Orr ambulance service for the purpose of 26.11capital expenditures as it relates to:26.12    (1) ambulance acquisitions for the Cook ambulance service and the Orr ambulance 26.13service and not;26.14    (2) attached and portable equipment for use in and for the ambulances; and26.15    (3) parts and replacement parts for maintenance and repair of the ambulances.26.16The money may not be used for administrative, operation,  or salary expenses.26.17    (c) The part of the levy referred to in paragraph (b) must be administered by the Cook 26.18Hospital and passed on directly to the Cook area ambulance service board and the city of 26.19Orr to be held in trust until funding for a new ambulance is needed by either the Cook 26.20ambulance service or the Orr ambulance service used for the purposes in paragraph (b).26.21    Sec. 16. Laws 1999, chapter 243, article 6, section 11, is amended to read:26.22    Sec. 11. CEMETERY LEVY FOR SAWYER BY CARLTON COUNTY.26.23    Subdivision 1.Levy authorized. Notwithstanding other law to the contrary, the 26.24Carlton county board of commissioners may annually levy in and for the unorganized 26.25township of Sawyer an amount up to $1,000 annually for cemetery purposes, beginning 26.26with taxes payable in 2000 and ending with taxes payable in 2009.26.27    Subd. 2.Effective date.This section is effective June 1, 1999, without local 26.28approval.26.29EFFECTIVE DATE; LOCAL APPROVAL.This section applies to taxes 26.30payable in 2013 and thereafter, and is effective the day after the Carlton county board 26.31of commissioners and its chief clerical officer timely complete their compliance with 26.32Minnesota Statutes, section 645.021, subdivisions 2 and 3.26.33    Sec. 17. Laws 2010, chapter 389, article 1, section 12, the effective date, is amended to 26.34read:27.1EFFECTIVE DATE.This section is effective for assessment years year 2010 and 27.22011, for taxes payable in 2011 and 2012 thereafter.27.3EFFECTIVE DATE.This section is effective for assessment year 2012 and 27.4thereafter.27.5    Sec. 18. HOLDING OF PROPERTY FOR ECONOMIC DEVELOPMENT; 27.6TEMPORARY EXTENSION.27.7    (a) For purposes of Minnesota Statutes, section 272.02, subdivision 39, a political 27.8subdivision's holding for resale for economic development of a property that is located in 27.9a city in the metropolitan area, or in a city with a population of more than 5,000 outside 27.10of the metropolitan area, as defined in Minnesota Statutes, section 473.121, subdivision 27.112, for up to ten years, is a public purpose.27.12    (b) The authority under this section expires on December 31, 2015.27.13EFFECTIVE DATE.This section is effective the day following final enactment.27.14    Sec. 19. ADDITIONAL AID PAYMENT IN 2012 FOR CERTAIN CITIES.27.15For calendar year 2012 only, a city shall receive a onetime payment of $12,000 27.16if: (1) the city's 2010 population is less than 100 and its population growth between 27.172000 and 2010 was more than 55 percent; and (2) its commercial industrial percentage as 27.18defined in Minnesota Statutes, section 477A.011, subdivision 32, based on assessments 27.19for calendar year 2010, payable 2011, is greater than 15 percent. The aid paid under this 27.20section shall be paid on the same schedule as aid paid under Minnesota Statutes, sections 27.21477A.011 to 477A.03. The amount necessary to make the payment under this section shall 27.22be appropriated from the general fund in fiscal year 2013.27.23EFFECTIVE DATE.This section is effective the day following final enactment.27.24    Sec. 20. SUPPLEMENTAL TARGETING REFUND FOR TAXES PAYABLE IN 27.252012 ONLY.27.26    Subdivision 1.Determination of supplemental refund.(a) For property tax refund 27.27claims under Minnesota Statutes, section 290A.04, subdivision 2h, based upon property 27.28taxes payable in 2012, the state must pay a supplemental refund such that the combined 27.29amount of the regular refund under Minnesota Statutes, section 290A.04, subdivision 2h, 27.30and the supplemental refund is equal to 90 percent of the increase over the greater of (1) 12 28.1percent of the payable 2011 property taxes, or (2) $100. The maximum combined refund 28.2under Minnesota Statutes, section 290A.04, subdivision 2h, and this section is $1,000.28.3(b) The supplemental refund amount must be determined by the commissioner of 28.4revenue based upon the information submitted with the claim for the regular refund and 28.5must be combined with the regular refund for payment.28.6(c) Any supplemental refund paid under this section must be subtracted from 28.7"property taxes payable" for the purposes of determining any refund amount under 28.8Minnesota Statutes, section 290A.04, subdivision 2, based upon property taxes payable 28.9in 2012.28.10(d) Any supplemental refund paid under this section must be subtracted from 28.11"property taxes payable" for taxes payable in 2012 for the purposes of determining any 28.12refund amount under Minnesota Statutes, section 290A.04, subdivision 2h, based upon 28.13property taxes payable in 2013.28.14    Subd. 2.Appropriation.The amount necessary to make the payments required 28.15under this section is appropriated to the commissioner of revenue from the general fund 28.16for fiscal years 2013 and 2014.28.17EFFECTIVE DATE.This section is effective for refund claims based on taxes 28.18payable in 2012 only.28.19ARTICLE 228.20INDIVIDUAL INCOME AND CORPORATE FRANCHISE TAXES28.21    Section 1. Minnesota Statutes 2011 Supplement, section 116J.8737, subdivision 1, 28.22is amended to read:28.23    Subdivision 1. Definitions. (a) For the purposes of this section, the following terms 28.24have the meanings given.28.25(b) "Qualified small business" means a business that has been certified by the 28.26commissioner under subdivision 2.28.27(c) "Qualified investor" means an investor who has been certified by the 28.28commissioner under subdivision 3.28.29(d) "Qualified fund" means a pooled angel investment network fund that has been 28.30certified by the commissioner under subdivision 4.28.31(e) "Qualified investment" means a cash investment in a qualified small business 28.32of a minimum of:28.33(1) $10,000 in a calendar year by a qualified investor; or28.34(2) $30,000 in a calendar year by a qualified fund.29.1A qualified investment must be made in exchange for common stock, a partnership 29.2or membership interest, preferred stock, debt with mandatory conversion to equity, or an 29.3equivalent ownership interest as determined by the commissioner.29.4(f) "Family" means a family member within the meaning of the Internal Revenue 29.5Code, section 267(c)(4).29.6(g) "Pass-through entity" means a corporation that for the applicable taxable year is 29.7treated as an S corporation or a general partnership, limited partnership, limited liability 29.8partnership, trust, or limited liability company and which for the applicable taxable year is 29.9not taxed as a corporation under chapter 290.29.10(h) "Intern" means a student of an accredited institution of higher education, or a 29.11former student who has graduated in the past six months from an accredited institution 29.12of higher education, who is employed by a qualified small business in a nonpermanent 29.13position for a duration of nine months or less that provides training and experience in the 29.14primary business activity of the business.29.15(i) "Liquidation event" means a conversion of qualified investment for cash, cash 29.16and other consideration, or any other form of equity or debt interest.29.17EFFECTIVE DATE.This section is effective for qualified small businesses 29.18certified after June 30, 2012.29.19    Sec. 2. Minnesota Statutes 2011 Supplement, section 116J.8737, subdivision 2, is 29.20amended to read:29.21    Subd. 2. Certification of qualified small businesses. (a) Businesses may apply 29.22to the commissioner for certification as a qualified small business for a calendar year. 29.23The application must be in the form and be made under the procedures specified by the 29.24commissioner, accompanied by an application fee of $150. Application fees are deposited 29.25in the small business investment tax credit administration account in the special revenue 29.26fund. The application for certification for 2010 must be made available on the department's 29.27Web site by August 1, 2010. Applications for subsequent years' certification must be made 29.28available on the department's Web site by November 1 of the preceding year.29.29(b) Within 30 days of receiving an application for certification under this subdivision, 29.30the commissioner must either certify the business as satisfying the conditions required of a 29.31qualified small business, request additional information from the business, or reject the 29.32application for certification. If the commissioner requests additional information from the 29.33business, the commissioner must either certify the business or reject the application within 29.3430 days of receiving the additional information. If the commissioner neither certifies the 29.35business nor rejects the application within 30 days of receiving the original application or 30.1within 30 days of receiving the additional information requested, whichever is later, then 30.2the application is deemed rejected, and the commissioner must refund the $150 application 30.3fee. A business that applies for certification and is rejected may reapply.30.4(c) To receive certification, a business must satisfy all of the following conditions:30.5(1) the business has its headquarters in Minnesota;30.6(2) at least 51 percent of the business's employees are employed in Minnesota, and 30.751 percent of the business's total payroll is paid or incurred in the state;30.8(3) the business is engaged in, or is committed to engage in, innovation in Minnesota 30.9in one of the following as its primary business activity:30.10(i) using proprietary technology to add value to a product, process, or service in a 30.11qualified high-technology field;30.12(ii) researching or developing a proprietary product, process, or service in a qualified 30.13high-technology field; or30.14(iii) researching, developing, or producing a new proprietary technology for use in 30.15the fields of agriculture, tourism, forestry, mining, manufacturing, or transportation;30.16(4) other than the activities specifically listed in clause (3), the business is not 30.17engaged in real estate development, insurance, banking, lending, lobbying, political 30.18consulting, information technology consulting, wholesale or retail trade, leisure, 30.19hospitality, transportation, construction, ethanol production from corn, or professional 30.20services provided by attorneys, accountants, business consultants, physicians, or health 30.21care consultants;30.22(5) the business has fewer than 25 employees;30.23(6) the business must pay its employees annual wages of at least 175 percent of the 30.24federal poverty guideline for the year for a family of four and must pay its interns annual 30.25wages of at least 175 percent of the federal minimum wage used for federally covered 30.26employers, except that this requirement must be reduced proportionately for employees 30.27and interns who work less than full-time, and does not apply to an executive, officer, or 30.28member of the board of the business, or to any employee who owns, controls, or holds 30.29power to vote more than 20 percent of the outstanding securities of the business;30.30(7) the business has not been in operation for more than ten years, except as provided 30.31in clause (8);30.32(8) the business has not been in operation for more than 20 years if the business is 30.33engaged in the research, development, or production of medical devices or pharmaceuticals 30.34for which U.S. Food and Drug Administration approval is required for use in the treatment 30.35or diagnosis of a disease or condition;31.1(8) (9) the business has not previously received private equity investments of more 31.2than $4,000,000; and31.3    (9) (10) the business is not an entity disqualified under section 
         80A.50, paragraph 31.4(b), clause (3); and31.5(11) the business has not issued securities that are traded on a public exchange.31.6(d) In applying the limit under paragraph (c), clause (5), the employees in all 31.7members of the unitary business, as defined in section 
         290.17, subdivision 4, must be 31.8included.31.9(e) In order for a qualified investment in a business to be eligible for tax credits,:31.10(1) the business must have applied for and received certification for the calendar 31.11year in which the investment was made prior to the date on which the qualified investment 31.12was made.;31.13(2) the business must not have issued securities that are traded on a public exchange;31.14(3) the business must not issue securities that are traded on a public exchange within 31.15180 days subsequent to the date on which the qualified investment was made; and31.16(4) the business must not have a liquidation event within 180 days subsequent to the 31.17date on which the qualified investment was made.31.18(f) The commissioner must maintain a list of businesses certified under this 31.19subdivision for the calendar year and make the list accessible to the public on the 31.20department's Web site.31.21(g) For purposes of this subdivision, the following terms have the meanings given:31.22(1) "qualified high-technology field" includes aerospace, agricultural processing, 31.23renewable energy, energy efficiency and conservation, environmental engineering, food 31.24technology, cellulosic ethanol, information technology, materials science technology, 31.25nanotechnology, telecommunications, biotechnology, medical device products, 31.26pharmaceuticals, diagnostics, biologicals, chemistry, veterinary science, and similar 31.27fields; and31.28(2) "proprietary technology" means the technical innovations that are unique and 31.29legally owned or licensed by a business and includes, without limitation, those innovations 31.30that are patented, patent pending, a subject of trade secrets, or copyrighted.31.31EFFECTIVE DATE.This section is effective for qualified small businesses 31.32certified after June 30, 2012, except the amendments to paragraph (c), clause (7), and 31.33paragraph (c), adding clause (8), are effective the day following final enactment.31.34    Sec. 3. Minnesota Statutes 2010, section 116J.8737, subdivision 5, is amended to read:32.1    Subd. 5. Credit allowed. (a) A qualified investor or qualified fund is eligible for 32.2a credit equal to 25 percent of the qualified investment in a qualified small business. 32.3Investments made by a pass-through entity qualify for a credit only if the entity is a 32.4qualified fund. The commissioner must not allocate more than $11,000,000 in credits to 32.5qualified investors or qualified funds for taxable years beginning after December 31, 32.62009, and before January 1, 2011, and must not allocate more than $12,000,000 in credits 32.7per year for taxable years beginning after December 31, 2010, and before January 1, 32.82015 2012, must not allocate more than $16,500,000 in credits per year for taxable years 32.9beginning after December 31, 2011, and before January 1, 2013, and must not allocate 32.10more than $17,000,000 in credits per year for taxable years beginning after December 31, 32.112012, and before January 1, 2015. Any portion of a taxable year's credits that is not 32.12allocated by the commissioner does not cancel and may be carried forward to subsequent 32.13taxable years until all credits have been allocated.32.14(b) The commissioner may not allocate more than a total maximum amount in credits 32.15for a taxable year to a qualified investor for the investor's cumulative qualified investments 32.16as an individual qualified investor and as an investor in a qualified fund; for married 32.17couples filing joint returns the maximum is $250,000, and for all other filers the maximum 32.18is $125,000. The commissioner may not allocate more than a total of $1,000,000 in credits 32.19over all taxable years for qualified investments in any one qualified small business.32.20(c) The commissioner may not allocate a credit to a qualified investor either as an 32.21individual qualified investor or as an investor in a qualified fund if the investor receives 32.22more than 50 percent of the investor's gross annual income from the qualified small 32.23business in which the qualified investment is proposed. A member of the family of an 32.24individual disqualified by this paragraph is not eligible for a credit under this section. For 32.25a married couple filing a joint return, the limitations in this paragraph apply collectively 32.26to the investor and spouse. For purposes of determining the ownership interest of an 32.27investor under this paragraph, the rules under section 267(c) and 267(e) of the Internal 32.28Revenue Code apply.32.29(d) Applications for tax credits for 2010 must be made available on the department's 32.30Web site by September 1, 2010, and the department must begin accepting applications 32.31by September 1, 2010. Applications for subsequent years must be made available by 32.32November 1 of the preceding year.32.33(e) Qualified investors and qualified funds must apply to the commissioner for tax 32.34credits. Tax credits must be allocated to qualified investors or qualified funds in the order 32.35that the tax credit request applications are filed with the department. The commissioner 32.36must approve or reject tax credit request applications within 15 days of receiving the 33.1application. The investment specified in the application must be made within 60 days of 33.2the allocation of the credits. If the investment is not made within 60 days, the credit 33.3allocation is canceled and available for reallocation. A qualified investor or qualified fund 33.4that fails to invest as specified in the application, within 60 days of allocation of the 33.5credits, must notify the commissioner of the failure to invest within five business days of 33.6the expiration of the 60-day investment period.33.7(f) All tax credit request applications filed with the department on the same day must 33.8be treated as having been filed contemporaneously. If two or more qualified investors or 33.9qualified funds file tax credit request applications on the same day, and the aggregate 33.10amount of credit allocation claims exceeds the aggregate limit of credits under this section 33.11or the lesser amount of credits that remain unallocated on that day, then the credits must 33.12be allocated among the qualified investors or qualified funds who filed on that day on a 33.13pro rata basis with respect to the amounts claimed. The pro rata allocation for any one 33.14qualified investor or qualified fund is the product obtained by multiplying a fraction, 33.15the numerator of which is the amount of the credit allocation claim filed on behalf of 33.16a qualified investor and the denominator of which is the total of all credit allocation 33.17claims filed on behalf of all applicants on that day, by the amount of credits that remain 33.18unallocated on that day for the taxable year.33.19(g) A qualified investor or qualified fund, or a qualified small business acting on their 33.20behalf, must notify the commissioner when an investment for which credits were allocated 33.21has been made, and the taxable year in which the investment was made. A qualified fund 33.22must also provide the commissioner with a statement indicating the amount invested by 33.23each investor in the qualified fund based on each investor's share of the assets of the 33.24qualified fund at the time of the qualified investment. After receiving notification that the 33.25investment was made, the commissioner must issue credit certificates for the taxable year 33.26in which the investment was made to the qualified investor or, for an investment made by 33.27a qualified fund, to each qualified investor who is an investor in the fund. The certificate 33.28must state that the credit is subject to revocation if the qualified investor or qualified 33.29fund does not hold the investment in the qualified small business for at least three years, 33.30consisting of the calendar year in which the investment was made and the two following 33.31years. The three-year holding period does not apply if:33.32(1) the investment by the qualified investor or qualified fund becomes worthless 33.33before the end of the three-year period;33.34(2) 80 percent or more of the assets of the qualified small business is sold before 33.35the end of the three-year period;33.36(3) the qualified small business is sold before the end of the three-year period; or34.1(4) the qualified small business's common stock begins trading on a public exchange 34.2before the end of the three-year period.34.3(h) The commissioner must notify the commissioner of revenue of credit certificates 34.4issued under this section.34.5EFFECTIVE DATE.This section is effective for taxable years beginning after 34.6December 31, 2011.34.7    Sec. 4. Minnesota Statutes 2010, section 116J.8737, is amended by adding a 34.8subdivision to read:34.9    Subd. 5a.Promotion of credit in greater Minnesota.(a) By July 1, 2012, the 34.10commissioner shall develop a plan to increase awareness of and use of the credit for 34.11investments in greater Minnesota businesses with a target goal that a minimum of 30 34.12percent of the credit will be awarded for those investments during the second half 34.13of calendar year 2013 and for each full calendar year thereafter. Beginning with the 34.14legislative report due on March 15, 2013, under subdivision 9, the commissioner shall 34.15report on its plan under this subdivision and the results achieved.34.16(b) If the target goal of 30 percent under paragraph (a) is not achieved for the 34.17six-month period ending on December 31, 2013, the credit percentage under subdivision 34.185, paragraph (a), is increased to 40 percent for a qualified investment made after December 34.1931, 2013, in a greater Minnesota business. This paragraph does not apply and the credit 34.20percentage for all qualified investments is the rate provided under subdivision 5 for any 34.21calendar year beginning after a calendar year for which the commissioner determines the 34.2230 percent target has been satisfied. The commissioner shall timely post notification of 34.23changes in the credit rate under this paragraph on the department's website.34.24(c) For purposes of this section, a "greater Minnesota business" means a qualified 34.25small business with its headquarters and 51 percent or more of its employees employed 34.26at Minnesota locations outside of the metropolitan area as defined in section 473.121, 34.27subdivision 2.34.28EFFECTIVE DATE.This section is effective the day following final enactment.34.29    Sec. 5. Minnesota Statutes 2010, section 116J.8737, subdivision 8, is amended to read:34.30    Subd. 8. Data privacy. (a) Data contained in an application submitted to the 34.31commissioner under subdivision 2, 3, or 4 are nonpublic data, or private data on 34.32individuals, as defined in section 
         13.02, subdivision 9 or 12, except that the following 34.33data items are public:35.1(1) the name, mailing address, telephone number, e-mail address, contact person's 35.2name, and industry type of a qualified small business upon approval of the application 35.3and certification by the commissioner under subdivision 2;35.4(2) the name of a qualified investor upon approval of the application and certification 35.5by the commissioner under subdivision 3;35.6(3) the name of a qualified fund upon approval of the application and certification 35.7by the commissioner under subdivision 4;35.8(4) for credit certificates issued under subdivision 5, the amount of the credit 35.9certificate issued, amount of the qualifying investment, the name of the qualifying investor 35.10or qualifying fund that received the certificate, and the name of the qualifying small 35.11business in which the qualifying investment was made;35.12(5) for credits revoked under subdivision 7, paragraph (a), the amount revoked and 35.13the name of the qualified investor or qualified fund; and35.14(6) for credits revoked under subdivision 7, paragraphs (b) and (c), the amount 35.15revoked and the name of the qualified small business.35.16(b) The following data, including data classified as nonpublic or private, must be 35.17provided to the consultant for use in conducting the program evaluation under subdivision 35.1810:35.19(1) the commissioner of employment and economic development shall provide data 35.20contained in an application for certification received from a qualified small business, 35.21qualified investor, or qualified fund, and any annual reporting information received on a 35.22qualified small business, qualified investor, or qualified fund; and35.23(2) the commissioner of revenue shall provide data contained in any applicable tax 35.24returns of a qualified small business, qualified investor, or qualified fund.35.25EFFECTIVE DATE.This section is effective for businesses requesting certification 35.26starting on the day following final enactment.35.27    Sec. 6. Minnesota Statutes 2011 Supplement, section 289A.02, subdivision 7, is 35.28amended to read:35.29    Subd. 7. Internal Revenue Code. Unless specifically defined otherwise, "Internal 35.30Revenue Code" means the Internal Revenue Code of 1986, as amended through April 14, 35.312011 February 14, 2012.35.32EFFECTIVE DATE.This section is effective the day following final enactment.35.33    Sec. 7. Minnesota Statutes 2010, section 289A.31, subdivision 5, is amended to read:36.1    Subd. 5. Withholding tax, withholding from payments to out-of-state 36.2contractors, and withholding by partnerships and small business corporations. (a) 36.3Except as provided in paragraph (b), an employer or person withholding tax under section 36.4290.92
          or 
         290.923, subdivision 2, who fails to pay to or deposit with the commissioner a 36.5sum or sums required by those sections to be deducted, withheld, and paid, is personally 36.6and individually liable to the state for the sum or sums, and added penalties and interest, 36.7and is not liable to another person for that payment or payments. The sum or sums 36.8deducted and withheld under section 
         290.92, subdivision 2a or 3, or 
         290.923, subdivision 36.92
         , must be held as a special fund in trust for the state of Minnesota.36.10(b) If the employer or person withholding tax under section 
         290.92 or 
         290.923, 36.11subdivision 2
         , fails to deduct and withhold the tax in violation of those sections, and later 36.12the taxes against which the tax may be credited are paid, the tax required to be deducted 36.13and withheld will not be collected from the employer. This does not, however, relieve the 36.14employer from liability for any penalties and interest otherwise applicable for failure to 36.15deduct and withhold. This paragraph does not apply to an employer subject to paragraph 36.16(g), or to a contractor required to withhold under section 290.92, subdivision 31.36.17(c) Liability for payment of withholding taxes includes a responsible person or entity 36.18described in the personal liability provisions of section 
         270C.56.36.19(d) Liability for payment of withholding taxes includes a third-party lender or surety 36.20described in section 
         270C.59.36.21(e) A partnership or S corporation required to withhold and remit tax under section 36.22290.92, subdivisions 4b and 4c
         , is liable for payment of the tax to the commissioner, and a 36.23person having control of or responsibility for the withholding of the tax or the filing of 36.24returns due in connection with the tax is personally liable for the tax due.36.25(f) A payor of sums required to be withheld under section 
         290.9705, subdivision 36.261
         , is liable to the state for the amount required to be deducted, and is not liable to an 36.27out-of-state contractor for the amount of the payment.36.28(g) If an employer fails to withhold tax from the wages of an employee when 36.29required to do so under section 
         290.92, subdivision 2a, by reason of treating such 36.30employee as not being an employee, then the liability for tax is equal to three percent of 36.31the wages paid to the employee. The liability for tax of an employee is not affected by 36.32the assessment or collection of tax under this paragraph. The employer is not entitled to 36.33recover from the employee any tax determined under this paragraph.36.34EFFECTIVE DATE.This section is effective for payments made after June 30, 36.352012.37.1    Sec. 8. Minnesota Statutes 2011 Supplement, section 290.01, subdivision 19, is 37.2amended to read:37.3    Subd. 19. Net income. The term "net income" means the federal taxable income, 37.4as defined in section 63 of the Internal Revenue Code of 1986, as amended through the 37.5date named in this subdivision, incorporating the federal effective dates of changes to the 37.6Internal Revenue Code and any elections made by the taxpayer in accordance with the 37.7Internal Revenue Code in determining federal taxable income for federal income tax 37.8purposes, and with the modifications provided in subdivisions 19a to 19f.37.9    In the case of a regulated investment company or a fund thereof, as defined in section 37.10851(a) or 851(g) of the Internal Revenue Code, federal taxable income means investment 37.11company taxable income as defined in section 852(b)(2) of the Internal Revenue Code, 37.12except that:37.13    (1) the exclusion of net capital gain provided in section 852(b)(2)(A) of the Internal 37.14Revenue Code does not apply;37.15    (2) the deduction for dividends paid under section 852(b)(2)(D) of the Internal 37.16Revenue Code must be applied by allowing a deduction for capital gain dividends and 37.17exempt-interest dividends as defined in sections 852(b)(3)(C) and 852(b)(5) of the Internal 37.18Revenue Code; and37.19    (3) the deduction for dividends paid must also be applied in the amount of any 37.20undistributed capital gains which the regulated investment company elects to have treated 37.21as provided in section 852(b)(3)(D) of the Internal Revenue Code.37.22    The net income of a real estate investment trust as defined and limited by section 37.23856(a), (b), and (c) of the Internal Revenue Code means the real estate investment trust 37.24taxable income as defined in section 857(b)(2) of the Internal Revenue Code.37.25    The net income of a designated settlement fund as defined in section 468B(d) of 37.26the Internal Revenue Code means the gross income as defined in section 468B(b) of the 37.27Internal Revenue Code.37.28    The Internal Revenue Code of 1986, as amended through April 14, 2011 February 37.2914, 2012, shall be in effect for taxable years beginning after December 31, 1996. The 37.30provisions of the act of January 22, 2010, Public Law 111-126, to accelerate the benefits 37.31for charitable cash contributions for the relief of victims of the Haitian earthquake, are 37.32effective at the same time they became effective for federal purposes and apply to the 37.33subtraction under subdivision 19b, clause (6). The provisions of title II, section 2112, of 37.34the act of September 27, 2010, Public Law 111-240, rollovers from elective deferral plans 37.35to designated Roth accounts, are effective at the same time they became effective for 38.1federal purposes and taxable rollovers are included in net income at the same time they are 38.2included in gross income for federal purposes.38.3    Except as otherwise provided, references to the Internal Revenue Code in 38.4subdivisions 19 to 19f mean the code in effect for purposes of determining net income for 38.5the applicable year.38.6EFFECTIVE DATE.This section is effective the day following final enactment.38.7    Sec. 9. Minnesota Statutes 2011 Supplement, section 290.01, subdivision 31, is 38.8amended to read:38.9    Subd. 31. Internal Revenue Code. Unless specifically defined otherwise, "Internal 38.10Revenue Code" means the Internal Revenue Code of 1986, as amended through April 14, 38.112011 February 14, 2012. Internal Revenue Code also includes any uncodified provision in 38.12federal law that relates to provisions of the Internal Revenue Code that are incorporated 38.13into Minnesota law. When used in this chapter, the reference to "subtitle A, chapter 1, 38.14subchapter N, part 1, of the Internal Revenue Code" is to the Internal Revenue Code as 38.15amended through March 18, 2010.38.16EFFECTIVE DATE.This section is effective the day following final enactment.38.17    Sec. 10. Minnesota Statutes 2010, section 290.068, subdivision 1, is amended to read:38.18    Subdivision 1. Credit allowed. A corporation, partners in a partnership, or 38.19shareholders in a corporation treated as an "S" corporation under section 
         290.9725 are 38.20allowed a credit against the tax computed under this chapter for the taxable year equal to:38.21    (a) ten percent of the first $2,000,000 of the excess (if any) of38.22    (1) the qualified research expenses for the taxable year, over38.23    (2) the base amount; and38.24    (b) 2.5 3.1 percent on all of such excess expenses over $2,000,000 for taxable years 38.25beginning after December 31, 2011.38.26EFFECTIVE DATE.This section is effective for taxable years beginning after 38.27December 31, 2011.38.28    Sec. 11. Minnesota Statutes 2010, section 290.0681, subdivision 1, is amended to read:38.29    Subdivision 1. Definitions. (a) For purposes of this section, the following terms 38.30have the meanings given.38.31(b) "Account" means the historic credit administration account in the special 38.32revenue fund.39.1(c) "Office" means the State Historic Preservation Office of the Minnesota Historical 39.2Society.39.3(d) "Project" means rehabilitation of a certified historic structure, as defined in 39.4section 47(c)(3)(A) of the Internal Revenue Code, that is located in Minnesota and is 39.5allowed a federal credit under section 47(a)(2) of the Internal Revenue Code.39.6(e) "Society" means the Minnesota Historical Society.39.7(f) "Federal credit" means the credit allowed under section 47(a)(2) of the Internal 39.8Revenue Code.39.9(g) "Placed in service" has the meaning used in section 47 of the Internal Revenue 39.10Code.39.11(h) "Qualified rehabilitation expenditures" has the meaning given in section 47 of 39.12the Internal Revenue Code.39.13EFFECTIVE DATE.This section is effective the day following final enactment.39.14    Sec. 12. Minnesota Statutes 2010, section 290.0681, subdivision 3, is amended to read:39.15    Subd. 3. Applications; allocations. (a) To qualify for a credit or grant under this 39.16section, the developer of a project must apply to the office before the rehabilitation begins. 39.17The application must contain the information and be in the form prescribed by the office. 39.18The office may collect a fee for application of up to $5,000, based on estimated qualified 39.19rehabilitation expenses expenditures, to offset costs associated with personnel and 39.20administrative expenses related to administering the credit and preparing the economic 39.21impact report in subdivision 9. Application fees are deposited in the account. The 39.22application must indicate if the application is for a credit or a grant in lieu of the credit 39.23or a combination of the two and designate the taxpayer qualifying for the credit or the 39.24recipient of the grant.39.25    (b) Upon approving an application for credit, the office shall issue allocation 39.26certificates that:39.27    (1) verify eligibility for the credit or grant;39.28    (2) state the amount of credit or grant anticipated with the project, with the credit 39.29amount equal to 100 percent and the grant amount equal to 90 percent of the federal 39.30credit anticipated in the application;39.31    (3) state that the credit or grant allowed may increase or decrease if the federal 39.32credit the project receives at the time it is placed in service is different than the amount 39.33anticipated at the time the allocation certificate is issued; and39.34    (4) state the fiscal year in which the credit or grant is allocated, and that the taxpayer 39.35or grant recipient is entitled to receive the credit or grant at the time the project is placed 40.1in service, provided that date is within three calendar years following the issuance of 40.2the allocation certificate.40.3    (c) The office, in consultation with the commissioner of revenue, shall determine 40.4if the project is eligible for a credit or a grant under this section and must notify the 40.5developer in writing of its determination. Eligibility for the credit is subject to review 40.6and audit by the commissioner of revenue.40.7    (d) The federal credit recapture and repayment requirements under section 50 of the 40.8Internal Revenue Code do not apply to the credit allowed under this section.40.9(e) Any decision of the office under paragraph (c) of this subdivision may be 40.10challenged as a contested case under chapter 14. The contested case proceeding must be 40.11initiated within 45 days of the date of written notification by the office.40.12EFFECTIVE DATE.This section is effective the day following final enactment.40.13    Sec. 13. Minnesota Statutes 2010, section 290.0681, subdivision 4, is amended to read:40.14    Subd. 4. Credit certificates; grants. (a)(1) The developer of a project for which the 40.15office has issued an allocation certificate must notify the office when the project is placed 40.16in service. Upon verifying that the project has been placed in service, and was allowed a 40.17federal credit, the office must issue a credit certificate to the taxpayer designated in the 40.18application or must issue a grant to the recipient designated in the application. The credit 40.19certificate must state the amount of the credit.40.20    (2) The credit amount equals the federal credit allowed for the project.40.21    (3) The grant amount equals 90 percent of the federal credit allowed for the project.40.22    (b) The recipient of a credit certificate may assign the certificate to another taxpayer, 40.23which is then allowed the credit under this section or section 
         297I.20, subdivision 3.  An 40.24assignment is not valid unless the assignee notifies the commissioner within 30 days of the 40.25date that the assignment is made. The commissioner shall prescribe the forms necessary 40.26for notifying the commissioner of the assignment of a credit certificate and for claiming 40.27a credit by assignment.40.28    (c) Credits passed through pursuant to subdivision 5 of this section are not an 40.29assignment of a credit certificate under this subdivision.40.30    (d) A grant agreement between the office and the recipient of a grant may allow the 40.31grant to be issued to another individual or entity.40.32EFFECTIVE DATE.This section is effective the day following final enactment.40.33    Sec. 14. Minnesota Statutes 2010, section 290.0681, subdivision 5, is amended to read:41.1    Subd. 5. Partnerships; multiple owners. Credits granted to a partnership, a limited 41.2liability company taxed as a partnership, S corporation, or multiple owners of property 41.3are passed through to the partners, members, shareholders, or owners, respectively, pro 41.4rata to each partner, member, shareholder, or owner based on their share of the entity's 41.5assets or as specially allocated in their organizational documents or any other executed 41.6agreement, as of the last day of the taxable year.41.7EFFECTIVE DATE.This section is effective the day following final enactment.41.8    Sec. 15. Minnesota Statutes 2010, section 290.0681, subdivision 10, is amended to 41.9read:41.10    Subd. 10. Sunset. This section expires after fiscal year 2015 2021, except that 41.11the office's authority to issue credit certificates under subdivision 4 based on allocation 41.12certificates that were issued before fiscal year 2016 2022 remains in effect through 201841.132024, and the reporting requirements in subdivision 9 remain in effect through the year 41.14following the year in which all allocation certificates have either been canceled or resulted 41.15in issuance of credit certificates, or 2019 2025, whichever is earlier.41.16EFFECTIVE DATE.This section is effective the day following final enactment.41.17    Sec. 16. [290.0693] VETERANS JOBS TAX CREDIT.41.18    Subdivision 1.Definitions.(a) For purposes of this section, the following terms 41.19have the meanings given.41.20(b)(1) "Full-time employee" means an employee as defined in section 290.92, 41.21subdivision 1, who meets the following criteria:41.22(i) the employee is paid wages as defined in section 290.92, subdivision 1, for at 41.23least 1,820 hours during the 12-month period that starts on the date of hire;41.24(ii) the employee's wages are attributable to Minnesota under section 290.191, 41.25subdivision 12;41.26(iii) the employee performs services for the employer in at least 50 weeks during the 41.2712-month period that starts on the date of hire; and 41.28(iv) the employee's total compensation, including benefits not mandated by law, is at 41.29least $25,000 for the 12-month period that starts on the date of hire.41.30(2) "Full-time employee" does not include:41.31(i) any employee who bears any of the relationships described in subparagraphs (A) 41.32to (G) of section 152(d)(2) of the Internal Revenue Code to the employer;42.1(ii) if the employer is a corporation, any employee who owns, directly or indirectly, 42.2more than 50 percent in value of the outstanding stock of the corporation, or if the 42.3employer is an entity other than a corporation, an employee who owns, directly or 42.4indirectly, more than 50 percent of the capital and profits interests in the entity, as 42.5determined with the application of section 267(c) of the Internal Revenue Code; or42.6(iii) if the employer is an estate or trust, any employee who is a fiduciary of the estate 42.7or trust, or is an individual who bears any of the relationships described in subparagraphs 42.8(A) to (G) of section 152(d)(2) of the Internal Revenue Code to a grantor, beneficiary, 42.9or fiduciary of the estate or trust.42.10(c) "Qualified employer" means an employer that:42.11(1) employed a total of five or more full-time employees on December 31, 2011; and42.12(2) hired one or more qualified full-time employees after March 31, 2012.42.13(d) "Qualified full-time employee" means a full-time employee who:42.14(1) has completed 12 consecutive months of service as a full-time employee for a 42.15qualified employer;42.16(2) is a qualified unemployed veteran; and42.17(3) is a resident of Minnesota on the date of hire.42.18(e) "Qualified unemployed veteran" is a person who:42.19(1) was in active military service in a designated area after September 11, 2001, 42.20as defined in section 290.0677;42.21(2) was separated from active military service at any time during the five-year period 42.22prior to the date of hire;42.23(3) received unemployment compensation under state or federal law for not less than 42.24four weeks during the one-year period prior to the date of hire; and42.25(4) was unemployed on the date of hire.42.26(f) "Date of hire" means the day that the qualified full-time employee begins 42.27performing services as an employee for the qualified employer.42.28(g) "Construction trades employer" means a person carrying on a trade or business 42.29described in industry code numbers 23 through 238990 of the North American Industry 42.30Classification System.42.31    Subd. 2.Credit for new full-time employees.(a) A qualified employer who is 42.32required to file a return under section 289A.08, subdivision 1, 2, or 3, is allowed a credit 42.33against the tax imposed by this chapter for the net increase in qualified full-time employees.42.34(b)(1) For hiring qualified full-time employees after March 30, 2012, but before 42.35January 1, 2013, the credit is equal to $3,000 times the net increase in full-time employees. 42.36The net increase in full-time employees is the difference between:43.1(i) the total number of full-time employees employed by the employer on December 43.231, 2011; and43.3(ii) the number of full-time employees employed by the employer on December 43.431, 2012.43.5The net increase in full-time employees cannot exceed the number of qualified full-time 43.6employees hired after March 31, 2012, but before January 1, 2013.43.7(2) For hiring qualified full-time employees after December 31, 2012, but before 43.8July 1, 2013, the credit is equal to $1,500 times the net increase in full-time employees. 43.9The net increase in full-time employees is the difference between:43.10(i) the total number of full-time employees employed by the taxpayer on December 43.1131, 2011; and43.12(ii) the number of full-time employees employed by the taxpayer on December 43.1331, 2013.43.14The net increase in full-time employees cannot exceed the number of qualified full-time 43.15employees hired after December 31, 2012, but before July 1, 2013.43.16(c) The credit may be claimed in the taxable year in which the qualified full-time 43.17employee completes 12 consecutive months of continuous service as a full-time employee 43.18of the qualified employer.43.19(d) The maximum aggregate credits allowed to a qualified employer under this 43.20section for all taxable years is $50,000.43.21(e) For members of a unitary business whose income and factors are included on a 43.22combined income report under section 289A.08, subdivision 3, the number of full-time 43.23employees and the maximum allowable credit are not determined at the individual 43.24member level but are instead determined at the group level.43.25    Subd. 3.Allocation of credits.(a) By July 1, 2012, the commissioner shall develop 43.26an Internet application that allows employers to apply for tentative credits. The application 43.27must include the employer's name, tax identification number, and North American Industry 43.28Classification System industry code, and the name and date of hire of the employee.43.29(b) The credit is available only to employers who apply for a tentative credit using 43.30the application in paragraph (a) and who receive notice that their application has been 43.31approved for a tentative credit.43.32(c) Employers may apply for a tentative credit no earlier than the date of hire of 43.33each qualified full-time employee. Any employer may file more than one tentative credit 43.34application, but no employer may apply for tentative credits for more than a total of 16 43.35employees hired in 2012 or 33 employees hired in 2013.44.1(d) The commissioner shall approve applications seeking tentative credits for the 44.2first 2,500 full-time employees based on the order in which the applications are received.44.3(e) The commissioner must promptly notify employers if they are eligible for a 44.4tentative credit. The notice must state that the employer is eligible for a credit only after 44.5the employee named in the application has worked for 12 consecutive months and all other 44.6conditions of eligibility are met.44.7(f) The commissioner shall promptly publish public notice when all 2,500 tentative 44.8credits have been applied for.44.9    Subd. 4.Tentative credits for construction trades employers.(a) Any 44.10construction trades employer may apply for a tentative credit.44.11(b) To remain eligible for a credit, a construction trades employer who has received 44.12a tentative credit must renew the tentative credit by filing an application with the 44.13commissioner no earlier than 180 days after date of hire and no more than 210 days after 44.14date of hire. The renewal notice must state that the employee for whom the tentative credit 44.15was originally granted is still an employee and that the employer reasonably believes that 44.16all qualifications of eligibility for a credit will be met.44.17(c) Any tentative credit issued to a construction trades employer that is not renewed 44.18within the time required for renewal is canceled. Any canceled tentative credits are 44.19available to be reissued by the commissioner to employers under subdivision 3.44.20    Subd. 5.Flow-through entities.Credits granted to a partnership, limited liability 44.21company taxed as a partnership, S corporation, or multiple owners of a business are passed 44.22through to the partners, members, shareholders, or owners, respectively, pro rata to each 44.23partner, member, shareholder, or owner based on their share of the entity's assets or as 44.24specially allocated in their organizational documents, as of the last day of the taxable year.44.25    Subd. 6.Refundable.If the amount of the credit allowed under this section exceeds 44.26the liability for tax under this chapter, the commissioner shall refund the excess to the 44.27taxpayer.44.28    Subd. 7.Appropriation.An amount sufficient to pay the refunds authorized by this 44.29section is appropriated to the commissioner from the general fund.44.30EFFECTIVE DATE.This section is effective the day following final enactment.44.31    Sec. 17. Minnesota Statutes 2011 Supplement, section 290A.03, subdivision 15, 44.32is amended to read:44.33    Subd. 15. Internal Revenue Code.  "Internal Revenue Code" means the Internal 44.34Revenue Code of 1986, as amended through April 14, 2011 February 14, 2012.45.1EFFECTIVE DATE.This section is effective the day following final enactment.45.2    Sec. 18. Minnesota Statutes 2011 Supplement, section 291.005, subdivision 1, is 45.3amended to read:45.4    Subdivision 1. Scope. Unless the context otherwise clearly requires, the following 45.5terms used in this chapter shall have the following meanings:45.6    (1) "Commissioner" means the commissioner of revenue or any person to whom the 45.7commissioner has delegated functions under this chapter.45.8    (2) "Federal gross estate" means the gross estate of a decedent as required to be 45.9valued and otherwise determined for federal estate tax purposes under the Internal 45.10Revenue Code.45.11    (3) "Internal Revenue Code" means the United States Internal Revenue Code of 45.121986, as amended through April 14, 2011 February 14, 2012, but without regard to the 45.13provisions of sections 501 and 901 of Public Law 107-16, as amended by Public Law 45.14111-312, and section 301(c) of Public Law 111-312.45.15    (4) "Minnesota adjusted taxable estate" means federal adjusted taxable estate as 45.16defined by section 2011(b)(3) of the Internal Revenue Code, plus45.17(i) the amount of deduction for state death taxes allowed under section 2058 of 45.18the Internal Revenue Code; less45.19(ii)(A) the value of qualified small business property under section 
         291.03, 45.20subdivision 9
         , and the value of qualified farm property under section 
         291.03, subdivision 45.2110
         , or (B) $4,000,000, whichever is less.45.22    (5) "Minnesota gross estate" means the federal gross estate of a decedent after (a) 45.23excluding therefrom any property included therein which has its situs outside Minnesota, 45.24and (b) including therein any property omitted from the federal gross estate which is 45.25includable therein, has its situs in Minnesota, and was not disclosed to federal taxing 45.26authorities.45.27    (6) "Nonresident decedent" means an individual whose domicile at the time of 45.28death was not in Minnesota.45.29    (7) "Personal representative" means the executor, administrator or other person 45.30appointed by the court to administer and dispose of the property of the decedent. If there 45.31is no executor, administrator or other person appointed, qualified, and acting within this 45.32state, then any person in actual or constructive possession of any property having a situs in 45.33this state which is included in the federal gross estate of the decedent shall be deemed 45.34to be a personal representative to the extent of the property and the Minnesota estate tax 45.35due with respect to the property.46.1    (8) "Resident decedent" means an individual whose domicile at the time of death 46.2was in Minnesota.46.3    (9) "Situs of property" means, with respect to real property, the state or country in 46.4which it is located; with respect to tangible personal property, the state or country in which 46.5it was normally kept or located at the time of the decedent's death; and with respect to 46.6intangible personal property, the state or country in which the decedent was domiciled 46.7at death.46.8EFFECTIVE DATE.This section is effective the day following final enactment.46.9    Sec. 19. Laws 2010, chapter 216, section 11, the effective date, is amended to read:46.10EFFECTIVE DATE.This section is effective for taxable years beginning 46.11after December 31, 2009, for certified historic structures for which qualified costs of 46.12rehabilitation are first paid under construction contracts entered intoafter May 1, 201046.13rehabilitation expenditures are first paid by the developer or taxpayer after May 1, 2010, 46.14for rehabilitation that occurs after May 1, 2010, provided that the application under 46.15subdivision 3 is submitted before the project is placed in service.46.16EFFECTIVE DATE.This section is effective the day following final enactment 46.17and applies retroactively for taxable years beginning after December 31, 2009, and for 46.18certified historic structures placed in service after May 1, 2010, but the office may not 46.19issue certificates allowed under the change to this section until July 1, 2013.46.20    Sec. 20. AMENDED RETURNS; CERTAIN IRA ROLLOVERS.46.21An individual who excludes an amount from net income in a prior taxable year 46.22through rollover of an airline payment amount to a traditional IRA, as authorized under 46.23Public Law 112-95, section 1106, may file an amended individual income tax return and 46.24claim for refund of state taxes as provided under Minnesota Statutes, section 289A.40, 46.25subdivision 1, or, if later, by April 15, 2013.46.26EFFECTIVE DATE.This section is effective the day following final enactment.46.27    Sec. 21.  REPEALER.46.28Minnesota Statutes 2010, section 290.92, subdivision 31, is repealed.46.29EFFECTIVE DATE.This section is effective for payments made after June 30, 46.302012.47.1ARTICLE 347.2SALES AND USE TAXES47.3    Section 1. Minnesota Statutes 2010, section 289A.20, subdivision 4, is amended to 47.4read:47.5    Subd. 4. Sales and use tax. (a) The taxes imposed by chapter 297A are due and 47.6payable to the commissioner monthly on or before the 20th day of the month following 47.7the month in which the taxable event occurred, or following another reporting period 47.8as the commissioner prescribes or as allowed under section 
         289A.18, subdivision 4, 47.9paragraph (f) or (g), except that:47.10(1) use taxes due on an annual use tax return as provided under section 
         289A.11, 47.11subdivision 1
         , are payable by April 15 following the close of the calendar year; and.47.12(2) except as provided in paragraph (f), for a vendor having a liability of $120,000 47.13or more during a fiscal year ending June 30, 2009, and fiscal years thereafter, the taxes 47.14imposed by chapter 297A, except as provided in paragraph (b), are due and payable to the 47.15commissioner monthly in the following manner:47.16(i) On or before the 14th day of the month following the month in which the taxable 47.17event occurred, the vendor must remit to the commissioner 90 percent of the estimated 47.18liability for the month in which the taxable event occurred.47.19(ii) On or before the 20th day of the month in which the taxable event occurs, the 47.20vendor must remit to the commissioner a prepayment for the month in which the taxable 47.21event occurs equal to 67 percent of the liability for the previous month.47.22(iii) On or before the 20th day of the month following the month in which the taxable 47.23event occurred, the vendor must pay any additional amount of tax not previously remitted 47.24under either item (i) or (ii ) or, if the payment made under item (i) or (ii) was greater than 47.25the vendor's liability for the month in which the taxable event occurred, the vendor may 47.26take a credit against the next month's liability in a manner prescribed by the commissioner.47.27(iv) Once the vendor first pays under either item (i) or (ii), the vendor is required to 47.28continue to make payments in the same manner, as long as the vendor continues having a 47.29liability of $120,000 or more during the most recent fiscal year ending June 30.47.30(v) Notwithstanding items (i), (ii), and (iv), if a vendor fails to make the required 47.31payment in the first month that the vendor is required to make a payment under either item 47.32(i) or (ii), then the vendor is deemed to have elected to pay under item (ii) and must make 47.33subsequent monthly payments in the manner provided in item (ii).47.34(vi) For vendors making an accelerated payment under item (ii), for the first month 47.35that the vendor is required to make the accelerated payment, on the 20th of that month, the 48.1vendor will pay 100 percent of the liability for the previous month and a prepayment for 48.2the first month equal to 67 percent of the liability for the previous month.48.3    (b) Notwithstanding paragraph (a), A vendor having a liability of $120,000 or more 48.4during a fiscal year ending June 30 must remit the June liability for the next year in the 48.5following manner:48.6    (1) Two business days before June 30 of the year, the vendor must remit 90 percent 48.7of the estimated June liability to the commissioner.48.8    (2) On or before August 20 of the year, the vendor must pay any additional amount 48.9of tax not remitted in June.48.10    (c) A vendor having a liability of:48.11    (1) $10,000 or more, but less than $120,000 during a fiscal year ending June 30, 48.122009, and fiscal years thereafter, must remit by electronic means all liabilities on returns 48.13due for periods beginning in the subsequent calendar year on or before the 20th day of 48.14the month following the month in which the taxable event occurred, or on or before the 48.1520th day of the month following the month in which the sale is reported under section 48.16289A.18, subdivision 4
         ; or48.17(2) $120,000 or more, during a fiscal year ending June 30, 2009, and fiscal years 48.18thereafter, must remit by electronic means all liabilities in the manner provided in 48.19paragraph (a), clause (2), on returns due for periods beginning in the subsequent calendar 48.20year, except for 90 percent of the estimated June liability, which is due two business days 48.21before June 30. The remaining amount of the June liability is due on August 20.48.22(d) Notwithstanding paragraph (b) or (c), a person prohibited by the person's 48.23religious beliefs from paying electronically shall be allowed to remit the payment by mail. 48.24The filer must notify the commissioner of revenue of the intent to pay by mail before 48.25doing so on a form prescribed by the commissioner. No extra fee may be charged to a 48.26person making payment by mail under this paragraph. The payment must be postmarked 48.27at least two business days before the due date for making the payment in order to be 48.28considered paid on a timely basis.48.29(e) Whenever the liability is $120,000 or more separately for: (1) the tax imposed 48.30under chapter 297A; (2) a fee that is to be reported on the same return as and paid with the 48.31chapter 297A taxes; or (3) any other tax that is to be reported on the same return as and 48.32paid with the chapter 297A taxes, then the payment of all the liabilities on the return must 48.33be accelerated as provided in this subdivision.48.34(f) At the start of the first calendar quarter at least 90 days after the cash flow 48.35account established in section 16A.152, subdivision 1, and the budget reserve account 48.36established in section 16A.152, subdivision 1a, reach the amounts listed in section 49.116A.152, subdivision 2, paragraph (a), the remittance of the accelerated payments required 49.2under paragraph (a), clause (2), must be suspended. The commissioner of management 49.3and budget shall notify the commissioner of revenue when the accounts have reached 49.4the required amounts. Beginning with the suspension of paragraph (a), clause (2), for a 49.5vendor with a liability of $120,000 or more during a fiscal year ending June 30, 2009, 49.6and fiscal years thereafter, the taxes imposed by chapter 297A are due and payable to the 49.7commissioner on the 20th day of the month following the month in which the taxable 49.8event occurred. Payments of tax liabilities for taxable events occurring in June under 49.9paragraph (b) are not changed.49.10EFFECTIVE DATE.This section is effective for taxes due and payable after 49.11June 30, 2012.49.12    Sec. 2. Minnesota Statutes 2011 Supplement, section 295.53, subdivision 1, is 49.13amended to read:49.14    Subdivision 1. Exemptions. (a) The following payments are excluded from the 49.15gross revenues subject to the hospital, surgical center, or health care provider taxes under 49.16sections 
         295.50 to 
         295.59:49.17(1) payments received for services provided under the Medicare program, including 49.18payments received from the government, and organizations governed by sections 1833 49.19and 1876 of title XVIII of the federal Social Security Act, United States Code, title 42, 49.20section 1395, and enrollee deductibles, coinsurance, and co-payments, whether paid by the 49.21Medicare enrollee or by a Medicare supplemental coverage as defined in section 
         62A.011, 49.22subdivision 3
         , clause (10), or by Medicaid payments under title XIX of the federal Social 49.23Security Act. Payments for services not covered by Medicare are taxable;49.24(2) payments received for home health care services;49.25(3) payments received from hospitals or surgical centers for goods and services on 49.26which liability for tax is imposed under section 
         295.52 or the source of funds for the 49.27payment is exempt under clause (1), (7), (10), or (14);49.28(4) payments received from health care providers for goods and services on which 49.29liability for tax is imposed under this chapter or the source of funds for the payment is 49.30exempt under clause (1), (7), (10), or (14);49.31(5) amounts paid for legend drugs, other than nutritional products and blood and 49.32blood components, to a wholesale drug distributor who is subject to tax under section 49.33295.52, subdivision 3
         , reduced by reimbursements received for legend drugs otherwise 49.34exempt under this chapter;50.1(6) payments received by a health care provider or the wholly owned subsidiary of a 50.2health care provider for care provided outside Minnesota;50.3(7) payments received from the chemical dependency fund under chapter 254B;50.4(8) payments received in the nature of charitable donations that are not designated 50.5for providing patient services to a specific individual or group;50.6(9) payments received for providing patient services incurred through a formal 50.7program of health care research conducted in conformity with federal regulations 50.8governing research on human subjects. Payments received from patients or from other 50.9persons paying on behalf of the patients are subject to tax;50.10(10) payments received from any governmental agency for services benefiting the 50.11public, not including payments made by the government in its capacity as an employer 50.12or insurer or payments made by the government for services provided under general 50.13assistance medical care, the MinnesotaCare program, or the medical assistance program 50.14governed by title XIX of the federal Social Security Act, United States Code, title 42, 50.15sections 1396 to 1396v;50.16(11) government payments received by the commissioner of human services for 50.17state-operated services;50.18(12) payments received by a health care provider for hearing aids and related 50.19equipment or prescription eyewear delivered outside of Minnesota;50.20(13) payments received by an educational institution from student tuition, student 50.21activity fees, health care service fees, government appropriations, donations, or grants, 50.22and for services identified in and provided under an individualized education program 50.23as defined in section 
         256B.0625 or Code of Federal Regulations, chapter 34, section 50.24300.340(a). Fee for service payments and payments for extended coverage are taxable;50.25(14) payments received under the federal Employees Health Benefits Act, United 50.26States Code, title 5, section 8909(f), as amended by the Omnibus Reconciliation Act of 50.271990. Enrollee deductibles, coinsurance, and co-payments are subject to tax; and50.28(15) payments received under the federal Tricare program, Code of Federal 50.29Regulations, title 32, section 199.17(a)(7). Enrollee deductibles, coinsurance, and 50.30co-payments are subject to tax.; and50.31(16) payments for laboratory services to examine and report results for a biological 50.32specimen that is collected outside the state. The entity claiming the exemption is required 50.33to keep adequate records demonstrating that the specimen was collected outside the state, 50.34so that the commissioner can ensure that the correct amount of tax is paid.51.1(b) Payments received by wholesale drug distributors for legend drugs sold directly 51.2to veterinarians or veterinary bulk purchasing organizations are excluded from the gross 51.3revenues subject to the wholesale drug distributor tax under sections 
         295.50 to 
         295.59.51.4EFFECTIVE DATE.This section is effective for gross revenues received from 51.5laboratory services provided on or after July 1, 2013.51.6    Sec. 3. Minnesota Statutes 2010, section 297A.61, subdivision 4, is amended to read:51.7    Subd. 4. Retail sale. (a) A "retail sale" means any sale, lease, or rental for any 51.8purpose, other than resale, sublease, or subrent of items by the purchaser in the normal 51.9course of business as defined in subdivision 21.51.10    (b) A sale of property used by the owner only by leasing it to others or by holding it 51.11in an effort to lease it, and put to no use by the owner other than resale after the lease or 51.12effort to lease, is a sale of property for resale.51.13    (c) A sale of master computer software that is purchased and used to make copies for 51.14sale or lease is a sale of property for resale.51.15    (d) A sale of building materials, supplies, and equipment to owners, contractors, 51.16subcontractors, or builders for the erection of buildings or the alteration, repair, or 51.17improvement of real property is a retail sale in whatever quantity sold, whether the sale is 51.18for purposes of resale in the form of real property or otherwise.51.19    (e) A sale of carpeting, linoleum, or similar floor covering to a person who provides 51.20for installation of the floor covering is a retail sale and not a sale for resale since a sale 51.21of floor covering which includes installation is a contract for the improvement of real 51.22property.51.23    (f) A sale of shrubbery, plants, sod, trees, and similar items to a person who provides 51.24for installation of the items is a retail sale and not a sale for resale since a sale of 51.25shrubbery, plants, sod, trees, and similar items that includes installation is a contract for 51.26the improvement of real property.51.27    (g) A sale of tangible personal property that is awarded as prizes is a retail sale and 51.28is not considered a sale of property for resale.51.29    (h) A sale of tangible personal property utilized or employed in the furnishing or 51.30providing of services under subdivision 3, paragraph (g), clause (1), including, but not 51.31limited to, property given as promotional items, is a retail sale and is not considered a 51.32sale of property for resale.51.33    (i) A sale of tangible personal property used in conducting lawful gambling under 51.34chapter 349 or the State Lottery under chapter 349A, including, but not limited to, 52.1property given as promotional items, is a retail sale and is not considered a sale of 52.2property for resale.52.3    (j) A sale of machines, equipment, or devices that are used to furnish, provide, or 52.4dispense goods or services, including, but not limited to, coin-operated devices, is a retail 52.5sale and is not considered a sale of property for resale.52.6    (k) In the case of a lease, a retail sale occurs (1) when an obligation to make a lease 52.7payment becomes due under the terms of the agreement or the trade practices of the lessor 52.8or; (2) in the case of a lease of a motor vehicle, as defined in section 
         297B.01, subdivision 52.911
         , but excluding vehicles with a manufacturer's gross vehicle weight rating greater than 52.1010,000 pounds and rentals of vehicles for not more than 28 days, at the time the lease is 52.11executed; or (3) for rent-to-own or lease-to-own used vehicles where the lessee may 52.12purchase or return the vehicle at any time without penalty, at the time each payment is 52.13made under the terms of the agreement.52.14    (l) In the case of a conditional sales contract, a retail sale occurs upon the transfer of 52.15title or possession of the tangible personal property.52.16    (m) A sale of a bundled transaction in which one or more of the products included 52.17in the bundle is a taxable product is a retail sale, except that if one of the products 52.18is a telecommunication service, ancillary service, Internet access, or audio or video 52.19programming service, and the seller has maintained books and records identifying through 52.20reasonable and verifiable standards the portions of the price that are attributable to the 52.21distinct and separately identifiable products, then the products are not considered part of a 52.22bundled transaction. For purposes of this paragraph:52.23    (1) the books and records maintained by the seller must be maintained in the regular 52.24course of business, and do not include books and records created and maintained by the 52.25seller primarily for tax purposes;52.26    (2) books and records maintained in the regular course of business include, but are 52.27not limited to, financial statements, general ledgers, invoicing and billing systems and 52.28reports, and reports for regulatory tariffs and other regulatory matters; and52.29    (3) books and records are maintained primarily for tax purposes when the books 52.30and records identify taxable and nontaxable portions of the price, but the seller maintains 52.31other books and records that identify different prices attributable to the distinct products 52.32included in the same bundled transaction.52.33EFFECTIVE DATE.This section is effective for leases entered into after June 52.3430, 2012.52.35    Sec. 4. Minnesota Statutes 2010, section 297A.68, subdivision 5, is amended to read:53.1    Subd. 5. Capital equipment. (a) Capital equipment is exempt. Except as provided 53.2in paragraphs (e) and (f), the tax must be imposed and collected as if the rate under section 53.3297A.62, subdivision 1
         , applied, and then refunded in the manner provided in section 53.4297A.75
         .53.5"Capital equipment" means machinery and equipment purchased or leased, and used 53.6in this state by the purchaser or lessee primarily for manufacturing, fabricating, mining, 53.7or refining tangible personal property to be sold ultimately at retail if the machinery and 53.8equipment are essential to the integrated production process of manufacturing, fabricating, 53.9mining, or refining. Capital equipment also includes machinery and equipment 53.10used primarily to electronically transmit results retrieved by a customer of an online 53.11computerized data retrieval system.53.12(b) Capital equipment includes, but is not limited to:53.13(1) machinery and equipment used to operate, control, or regulate the production 53.14equipment;53.15(2) machinery and equipment used for research and development, design, quality 53.16control, and testing activities;53.17(3) environmental control devices that are used to maintain conditions such as 53.18temperature, humidity, light, or air pressure when those conditions are essential to and are 53.19part of the production process;53.20(4) materials and supplies used to construct and install machinery or equipment;53.21(5) repair and replacement parts, including accessories, whether purchased as spare 53.22parts, repair parts, or as upgrades or modifications to machinery or equipment;53.23(6) materials used for foundations that support machinery or equipment;53.24(7) materials used to construct and install special purpose buildings used in the 53.25production process;53.26(8) ready-mixed concrete equipment in which the ready-mixed concrete is mixed 53.27as part of the delivery process regardless if mounted on a chassis, repair parts for 53.28ready-mixed concrete trucks, and leases of ready-mixed concrete trucks; and53.29(9) machinery or equipment used for research, development, design, or production 53.30of computer software.53.31(c) Capital equipment does not include the following:53.32(1) motor vehicles taxed under chapter 297B;53.33(2) machinery or equipment used to receive or store raw materials;53.34(3) building materials, except for materials included in paragraph (b), clauses (6) 53.35and (7);54.1(4) machinery or equipment used for nonproduction purposes, including, but not 54.2limited to, the following: plant security, fire prevention, first aid, and hospital stations; 54.3support operations or administration; pollution control; and plant cleaning, disposal of 54.4scrap and waste, plant communications, space heating, cooling, lighting, or safety;54.5(5) farm machinery and aquaculture production equipment as defined by section 54.6297A.61
         , subdivisions 12 and 13;54.7(6) machinery or equipment purchased and installed by a contractor as part of an 54.8improvement to real property;54.9(7) machinery and equipment used by restaurants in the furnishing, preparing, or 54.10serving of prepared foods as defined in section 
         297A.61, subdivision 31;54.11(8) machinery and equipment used to furnish the services listed in section 
         297A.61, 54.12subdivision 3
         , paragraph (g), clause (6), items (i) to (vi) and (viii);54.13(9) machinery or equipment used in the transportation, transmission, or distribution 54.14of petroleum, liquefied gas, natural gas, water, or steam, in, by, or through pipes, lines, 54.15tanks, mains, or other means of transporting those products. This clause does not apply to 54.16machinery or equipment used to blend petroleum or biodiesel fuel as defined in section 54.17239.77
         ; or54.18(10) any other item that is not essential to the integrated process of manufacturing, 54.19fabricating, mining, or refining.54.20(d) For purposes of this subdivision:54.21(1) "Equipment" means independent devices or tools separate from machinery but 54.22essential to an integrated production process, including computers and computer software, 54.23used in operating, controlling, or regulating machinery and equipment; and any subunit or 54.24assembly comprising a component of any machinery or accessory or attachment parts of 54.25machinery, such as tools, dies, jigs, patterns, and molds.54.26(2) "Fabricating" means to make, build, create, produce, or assemble components or 54.27property to work in a new or different manner.54.28(3) "Integrated production process" means a process or series of operations through 54.29which tangible personal property is manufactured, fabricated, mined, or refined. For 54.30purposes of this clause, (i) manufacturing begins with the removal of raw materials 54.31from inventory and ends when the last process prior to loading for shipment has been 54.32completed; (ii) fabricating begins with the removal from storage or inventory of the 54.33property to be assembled, processed, altered, or modified and ends with the creation 54.34or production of the new or changed product; (iii) mining begins with the removal of 54.35overburden from the site of the ores, minerals, stone, peat deposit, or surface materials and 54.36ends when the last process before stockpiling is completed; and (iv) refining begins with 55.1the removal from inventory or storage of a natural resource and ends with the conversion 55.2of the item to its completed form.55.3(4) "Machinery" means mechanical, electronic, or electrical devices, including 55.4computers and computer software, that are purchased or constructed to be used for the 55.5activities set forth in paragraph (a), beginning with the removal of raw materials from 55.6inventory through completion of the product, including packaging of the product.55.7(5) "Machinery and equipment used for pollution control" means machinery and 55.8equipment used solely to eliminate, prevent, or reduce pollution resulting from an activity 55.9described in paragraph (a).55.10(6) "Manufacturing" means an operation or series of operations where raw materials 55.11are changed in form, composition, or condition by machinery and equipment and which 55.12results in the production of a new article of tangible personal property. For purposes of 55.13this subdivision, "manufacturing" includes the generation of electricity or steam to be 55.14sold at retail.55.15(7) "Mining" means the extraction of minerals, ores, stone, or peat.55.16(8) "Online data retrieval system" means a system whose cumulation of information 55.17is equally available and accessible to all its customers.55.18(9) "Primarily" means machinery and equipment used 50 percent or more of the time 55.19in an activity described in paragraph (a).55.20(10) "Refining" means the process of converting a natural resource to an intermediate 55.21or finished product, including the treatment of water to be sold at retail.55.22(11) This subdivision does not apply to telecommunications equipment as 55.23provided in subdivision 35, and does not apply to wire, cable, fiber, poles, or conduit 55.24for telecommunications services.55.25(e) Materials exempt under this section may be purchased without imposing and 55.26collecting the tax and applying for a refund under section 297A.75, if, for calendar years 55.272013 to 2015, the purchaser employed not more than 80 full-time employees at any time 55.28during calendar year 2010, and:55.29(1) did not have more than $1,000,000 in annual gross revenues or $2,500,000 in 55.30annual gross revenues if the business is a technical or professional service; and55.31(2) was not more than 20 percent owned by a business that had more than $1,000,000 55.32in annual gross revenues or $2,500,000 in annual gross revenues if the business is a 55.33technical or professional service.55.34(f) For calendar year 2016 and thereafter, all purchases exempt under this section 55.35may be purchased without imposing and collecting the tax and applying the refund 55.36under section 297A.75.56.1EFFECTIVE DATE.This section is effective for sales and purchases made after 56.2June 30, 2012.56.3    Sec. 5. Minnesota Statutes 2011 Supplement, section 297A.68, subdivision 42, is 56.4amended to read:56.5    Subd. 42. Qualified data centers. (a) Purchases of enterprise information 56.6technology equipment and computer software for use in a qualified data center are exempt. 56.7The tax on purchases exempt under this paragraph must be imposed and collected as if 56.8the rate under section 
         297A.62, subdivision 1, applied, and then refunded after June 30, 56.92013, in the manner provided in section 
         297A.75. This exemption includes enterprise 56.10information technology equipment and computer software purchased to replace or upgrade 56.11enterprise information technology equipment and computer software in a qualified data 56.12center.56.13(b) Electricity used or consumed in the operation of a qualified data center is exempt.56.14(c) For purposes of this subdivision, "qualified data center" means a facility in 56.15Minnesota:56.16(1) that is comprised of one or more buildings that consist in the aggregate of at 56.17least 30,000 square feet, and that are located on a single parcel or on contiguous parcels, 56.18where the total cost of construction or refurbishment, investment in enterprise information 56.19technology equipment, and computer software is at least $50,000,000 $30,000,000 within 56.20a 24-month three-year period;56.21(2) that is constructed or substantially refurbished after June 30, 2012, where 56.22"substantially refurbished" means that at least 30,000 25,000 square feet have been rebuilt 56.23or modified; and, including:56.24(i) installation of enterprise information technology equipment, computer software, 56.25environmental control and energy efficiency improvements; and56.26(ii) building improvements; and56.27(3) that is used to house enterprise information technology equipment, where the 56.28facility has the following characteristics:56.29(i) uninterruptible power supplies, generator backup power, or both;56.30(ii) sophisticated fire suppression and prevention systems; and56.31(iii) enhanced security. A facility will be considered to have enhanced security if it 56.32has restricted access to the facility to selected personnel; permanent security guards; video 56.33camera surveillance; an electronic system requiring pass codes, keycards, or biometric 56.34scans, such as hand scans and retinal or fingerprint recognition; or similar security features.57.1In determining whether the facility has the required square footage, the square 57.2footage of the following spaces shall be included if the spaces support the operation 57.3of enterprise information technology equipment: office space, meeting space, and 57.4mechanical and other support facilities. For purposes of this subdivision, "computer 57.5software" includes, but is not limited to, software utilized or loaded at the qualified data 57.6center, including maintenance, licensing, and software customization.57.7(d) For purposes of this subdivision, "enterprise information technology equipment" 57.8means computers and equipment supporting computing, networking, or data storage, 57.9including servers and routers. It includes, but is not limited to: cooling systems, 57.10cooling towers, and other temperature control infrastructure; power infrastructure for 57.11transformation, distribution, or management of electricity used for the maintenance 57.12and operation of a qualified data center, including but not limited to exterior dedicated 57.13business-owned substations, backup power generation systems, battery systems, and 57.14related infrastructure; and racking systems, cabling, and trays, which are necessary for 57.15the maintenance and operation of the qualified data center.57.16(e) A qualified data center may claim the exemptions in this subdivision for 57.17purchases made either within 20 years of the date of its first purchase qualifying for the 57.18exemption under paragraph (a), or by June 30, 2042, whichever is earlier.57.19(f) The purpose of this exemption is to create jobs in the construction and data 57.20center industries.57.21(g) This subdivision is effective for sales and purchases made after June 30, 2012, 57.22and before July 1, 2042.57.23EFFECTIVE DATE.This section is effective for sales and purchases made after 57.24June 30, 2012.57.25    Sec. 6. Minnesota Statutes 2010, section 297A.70, subdivision 4, is amended to read:57.26    Subd. 4. Sales to nonprofit groups. (a) All sales, except those listed in paragraph 57.27(b), to the following "nonprofit organizations" are exempt:57.28(1) a corporation, society, association, foundation, or institution organized and 57.29operated exclusively for charitable, religious, or educational purposes if the item 57.30purchased is used in the performance of charitable, religious, or educational functions; and57.31(2) any senior citizen group or association of groups that:57.32(i) in general limits membership to persons who are either age 55 or older, or 57.33physically disabled;58.1(ii) is organized and operated exclusively for pleasure, recreation, and other 58.2nonprofit purposes, not including housing, no part of the net earnings of which inures to 58.3the benefit of any private shareholders; and58.4(iii) is an exempt organization under section 501(c) of the Internal Revenue Code.58.5For purposes of this subdivision, charitable purpose includes the maintenance of a 58.6cemetery owned by a religious organization.58.7(b) This exemption does not apply to the following sales:58.8(1) building, construction, or reconstruction materials purchased by a contractor 58.9or a subcontractor as a part of a lump-sum contract or similar type of contract with a 58.10guaranteed maximum price covering both labor and materials for use in the construction, 58.11alteration, or repair of a building or facility;58.12(2) construction materials purchased by tax-exempt entities or their contractors to 58.13be used in constructing buildings or facilities that will not be used principally by the 58.14tax-exempt entities; and58.15(3) lodging as defined under section 
         297A.61, subdivision 3, paragraph (g), clause 58.16(2), and prepared food, candy, soft drinks, and alcoholic beverages as defined in section 58.17297A.67, subdivision 2
         , except wine purchased by an established religious organization 58.18for sacramental purposes or as allowed under subdivision 9a; and58.19(4) leasing of a motor vehicle as defined in section 
         297B.01, subdivision 11, except 58.20as provided in paragraph (c).58.21(c) This exemption applies to the leasing of a motor vehicle as defined in section 58.22297B.01, subdivision 11
         , only if the vehicle is:58.23(1) a truck, as defined in section 
         168.002, a bus, as defined in section 
         168.002, or a 58.24passenger automobile, as defined in section 
         168.002, if the automobile is designed and 58.25used for carrying more than nine persons including the driver; and58.26(2) intended to be used primarily to transport tangible personal property or 58.27individuals, other than employees, to whom the organization provides service in 58.28performing its charitable, religious, or educational purpose.58.29(d) A limited liability company also qualifies for exemption under this subdivision if 58.30(1) it consists of a sole member that would qualify for the exemption, and (2) the items 58.31purchased qualify for the exemption.58.32EFFECTIVE DATE.This section is effective for sales and purchases made after 58.33June 30, 2012.58.34    Sec. 7. Minnesota Statutes 2010, section 297A.70, is amended by adding a subdivision 58.35to read:59.1    Subd. 9a.Established religious orders.(a) Sales of lodging, prepared food, candy, 59.2soft drinks, and alcoholic beverages at noncatered events between an established religious 59.3order and an affiliated institution of higher education are exempt.59.4(b) For purposes of this subdivision, "established religious order" means an 59.5organization directly or indirectly under the control or supervision of a church or 59.6convention or association of churches, where members of the organization (1) normally 59.7live together as part of a community, (2) make long-term commitments to live under a 59.8strict set of moral and spiritual rules, and (3) work or engage full time in a combination 59.9of prayer, religious study, church reform or renewal, or other religious, educational, or 59.10charitable goals of the organization.59.11(c) For purposes of this subdivision, an institution of higher education is "affiliated" 59.12with an established religious order if members of the religious order are represented 59.13on the governing board of the institution of higher education and the two organization 59.14share campus space and common facilities.59.15EFFECTIVE DATE.This section is effective for sales and purchases made after 59.16June 30, 2012.59.17    Sec. 8. Minnesota Statutes 2010, section 297A.70, is amended by adding a subdivision 59.18to read:59.19    Subd. 18.Nursing homes and boarding care homes.(a) All sales, except those 59.20listed in paragraph (b), to a nursing home licensed under section 144A.02 or a boarding 59.21care home certified as a nursing facility under title 19 of the Social Security Act are 59.22exempt if the facility:59.23(1) is exempt from federal income taxation pursuant to section 501(c)(3) of the 59.24Internal Revenue Code; and59.25(2) is certified to participate in the medical assistance program under title 19 of the 59.26Social Security Act, or certifies to the commissioner that it does not discharge residents 59.27due to the inability to pay.59.28(b) This exemption does not apply to the following sales:59.29(1) building, construction, or reconstruction materials purchased by a contractor 59.30or a subcontractor as a part of a lump-sum contract or similar type of contract with a 59.31guaranteed maximum price covering both labor and materials for use in the construction, 59.32alteration, or repair of a building or facility;59.33(2) construction materials purchased by tax-exempt entities or their contractors to 59.34be used in constructing buildings or facilities that will not be used principally by the 59.35tax-exempt entities;60.1(3) lodging as defined under section 297A.61, subdivision 3, paragraph (g), clause 60.2(2), and prepared food, candy, soft drinks, and alcoholic beverages as defined in section 60.3297A.67, subdivision 2; and60.4(4) leasing of a motor vehicle as defined in section 297B.01, subdivision 11, except 60.5as provided in paragraph (c).60.6(c) This exemption applies to the leasing of a motor vehicle as defined in section 60.7297B.01, subdivision 11, only if the vehicle is:60.8(1) a truck, as defined in section 168.002; a bus, as defined in section 168.002; or a 60.9passenger automobile, as defined in section 168.002, if the automobile is designed and 60.10used for carrying more than nine persons including the driver; and60.11(2) intended to be used primarily to transport tangible personal property or residents 60.12of the nursing home or boarding care home.60.13EFFECTIVE DATE.This section is effective for sales and purchases made after 60.14June 30, 2012.60.15    Sec. 9. Minnesota Statutes 2010, section 297A.815, subdivision 3, is amended to read:60.16    Subd. 3. Motor vehicle lease sales tax revenue. (a) For purposes of this 60.17subdivision, "net revenue" means an amount equal to:60.18    (1) the revenues, including interest and penalties, collected under this section and 60.19on the leases under section 297A.61, subdivision 4, paragraph (k), clause (3), during 60.20the fiscal year; less60.21    (2) in fiscal year 2011, $30,100,000; in fiscal year 2012, $31,100,000; and in fiscal 60.22year 2013 and following fiscal years, $32,000,000.60.23    (b) On or before June 30 of each fiscal year, the commissioner of revenue shall 60.24estimate the amount of the revenues and subtraction under paragraph (a) for the current 60.25fiscal year.60.26    (c) On or after July 1 of the subsequent fiscal year, the commissioner of management 60.27and budget shall transfer the net revenue as estimated in paragraph (b) from the general 60.28fund, as follows:60.29    (1) 50 percent to the greater Minnesota transit account; and60.30    (2) 50 percent to the county state-aid highway fund. Notwithstanding any other law 60.31to the contrary, the commissioner of transportation shall allocate the funds transferred 60.32under this clause to the counties in the metropolitan area, as defined in section 
         473.121, 60.33subdivision 4, excluding the counties of Hennepin and Ramsey, so that each county shall 60.34receive of such amount the percentage that its population, as defined in section 
         477A.011, 61.1subdivision 3, estimated or established by July 15 of the year prior to the current calendar 61.2year, bears to the total population of the counties receiving funds under this clause.61.3    (d) For fiscal years 2010 and 2011, the amount under paragraph (a), clause (1), must 61.4be calculated using the following percentages of the total revenues:61.5    (1) for fiscal year 2010, 83.75 percent; and61.6    (2) for fiscal year 2011, 93.75 percent.61.7EFFECTIVE DATE.This section is effective for leases entered into after June 61.830, 2012.61.9    Sec. 10. Laws 1998, chapter 389, article 8, section 43, subdivision 3, as amended by 61.10Laws 2005, First Special Session chapter 3, article 5, section 28, and Laws 2011, First 61.11Special Session chapter 7, article 4, section 5, is amended to read:61.12    Subd. 3. Use of revenues. (a) Revenues received from the taxes authorized by 61.13subdivisions 1 and 2 must be used by the city to pay for the cost of collecting and 61.14administering the taxes and to pay for the following projects:61.15    (1) transportation infrastructure improvements including regional highway and 61.16airport improvements;61.17    (2) improvements to the civic center complex;61.18    (3) a municipal water, sewer, and storm sewer project necessary to improve regional 61.19ground water quality; and61.20    (4) construction of a regional recreation and sports center and other higher education 61.21facilities available for both community and student use.61.22    (b) The total amount of capital expenditures or bonds for projects listed in paragraph 61.23(a) that may be paid from the revenues raised from the taxes authorized in this section 61.24may not exceed $111,500,000. The total amount of capital expenditures or bonds for the 61.25project in clause (4) that may be paid from the revenues raised from the taxes authorized 61.26in this section may not exceed $28,000,000.61.27    (c) In addition to the projects authorized in paragraph (a) and not subject to the 61.28amount stated in paragraph (b), the city of Rochester may, if approved by the voters at an 61.29election under subdivision 5, paragraph (c), use the revenues received from the taxes and 61.30bonds authorized in this section to pay the costs of or bonds for the following purposes:61.31    (1) $17,000,000 for capital expenditures and bonds for the following Olmsted 61.32County transportation infrastructure improvements:61.33    (i) County State Aid Highway 34 reconstruction;61.34    (ii) Trunk Highway 63 and County State Aid Highway 16 interchange; 62.1    (iii) phase II of the Trunk Highway 52 and County State Aid Highway 22 62.2interchange;62.3    (iv) widening of County State Aid Highway 22 West Circle Drive; and 62.4    (v) 60th Avenue Northwest corridor preservation;62.5    (2) $30,000,000 for city transportation projects including:62.6    (i) Trunk Highway 52 and 65th Street interchange;62.7    (ii) NW transportation corridor acquisition; 62.8    (iii) Phase I of the Trunk Highway 52 and County State Aid Highway 22 interchange;62.9    (iv) Trunk Highway 14 and Trunk Highway 63 intersection;62.10    (v) Southeast transportation corridor acquisition;62.11    (vi) Rochester International Airport expansion; and 62.12    (vii) a transit operations center bus facility;62.13    (3) $14,000,000 for the University of Minnesota Rochester academic and 62.14complementary facilities;62.15    (4) $6,500,000 for the Rochester Community and Technical College/Winona State 62.16University career technical education and science and math facilities;62.17    (5) $6,000,000 for the Rochester Community and Technical College regional 62.18recreation facilities at University Center Rochester;62.19    (6) $20,000,000 for the Destination Medical Community Initiative;62.20    (7) $8,000,000 for the regional public safety and 911 dispatch center facilities;62.21    (8) $20,000,000 for a regional recreation/senior center;62.22    (9) $10,000,000 for an economic development fund; and62.23    (10) $8,000,000 for downtown infrastructure.62.24    (d) No revenues from the taxes raised from the taxes authorized in subdivisions 1 62.25and 2 may be used to fund transportation improvements related to a railroad bypass that 62.26would divert traffic from the city of Rochester.62.27    (e) The city shall use $5,000,000 of the money allocated to the purpose in paragraph 62.28(c), clause (9), for grants to the cities of Byron, Chatfield, Dodge Center, Dover, Elgin, 62.29Eyota, Kasson, Mantorville, Oronoco, Pine Island, Plainview, St. Charles, Stewartville, 62.30Zumbrota, Spring Valley, West Concord, and Hayfield, and any other city with a 2010 62.31population of at least 1,000 that has a city boundary within 25 miles of the geographic 62.32center of Rochester and is closer to Rochester than to any other city located wholly 62.33outside of the seven-county metropolitan area with a population of 20,000 or more,62.34for economic development projects that these communities would fund through their 62.35economic development authority or housing and redevelopment authority.62.36EFFECTIVE DATE.This section is effective the day following final enactment.63.1    Sec. 11. Laws 2002, chapter 377, article 3, section 25, as amended by Laws 2009, 63.2chapter 88, article 4, section 19, and Laws 2010, chapter 389, article 5, section 3, is 63.3amended to read:63.4    Sec. 25. ROCHESTER LODGING TAX.63.5    Subdivision 1. Authorization. Notwithstanding Minnesota Statutes, section 63.6469.190
          or 
         477A.016, or any other law, the city of Rochester may impose an additional 63.7tax of one percent on the gross receipts from the furnishing for consideration of lodging at 63.8a hotel, motel, rooming house, tourist court, or resort, other than the renting or leasing of it 63.9for a continuous period of 30 days or more.63.10    Subd. 1a. Authorization. Notwithstanding Minnesota Statutes, section 
         469.19063.11or 
         477A.016, or any other law, and in addition to the tax authorized by subdivision 1, 63.12the city of Rochester may impose an additional tax of one three percent on the gross 63.13receipts from the furnishing for consideration of lodging at a hotel, motel, rooming house, 63.14tourist court, or resort, other than the renting or leasing of it for a continuous period of 63.1530 days or more only upon the approval of the city governing body of a total financial 63.16package for the project.63.17    Subd. 2. Disposition of proceeds. (a) The gross proceeds from the tax imposed 63.18under subdivision 1 must be used by the city to fund a local convention or tourism bureau 63.19for the purpose of marketing and promoting the city as a tourist or convention center.63.20    (b) The gross proceeds from the one three percent tax imposed under subdivision 63.211a shall be used to pay for (1) construction, renovation, improvement, and expansion of 63.22the Mayo Civic Center and related skyway access, lighting, parking, or landscaping; and 63.23(2) for payment of any principal, interest, or premium on bonds issued to finance the 63.24construction, renovation, improvement, and expansion of the Mayo Civic Center Complex.63.25    Subd. 2a. Bonds. The city of Rochester may issue, without an election, general 63.26obligation bonds of the city, in one or more series, in the aggregate principal amount 63.27not to exceed $43,500,000, to pay for capital and administrative costs for the design, 63.28construction, renovation, improvement, and expansion of the Mayo Civic Center Complex, 63.29and related skyway, access, lighting, parking, and landscaping. The city may pledge 63.30the lodging tax authorized by subdivision 1a and the food and beverage tax authorized 63.31under Laws 2009, chapter 88, article 4, section 23, to the payment of the bonds. The debt 63.32represented by the bonds is not included in computing any debt limitations applicable to 63.33the city, and the levy of taxes required by Minnesota Statutes, section 
         475.61, to pay the 63.34principal of and interest on the bonds is not subject to any levy limitation or included in 63.35computing or applying any levy limitation applicable to the city.64.1    Subd. 3. Expiration of taxing authority. The authority of the city to impose a 64.2tax under subdivision 1a shall expire when the principal and interest on any bonds or 64.3other obligations issued prior to December 31, 2014 2016, to finance the construction, 64.4renovation, improvement, and expansion of the Mayo Civic Center Complex and related 64.5skyway access, lighting, parking, or landscaping have been paid, including any bonds 64.6issued to refund such bonds, or at an earlier time as the city shall, by ordinance, determine. 64.7Any funds remaining after completion of the project and retirement or redemption of the 64.8bonds shall be placed in the general fund of the city.64.9EFFECTIVE DATE.This section is effective the day after the governing body of 64.10the city of Rochester and its chief clerical officer comply with Minnesota Statutes, section 64.11645.021, subdivisions 2 and 3.64.12    Sec. 12. Laws 2005, First Special Session chapter 3, article 5, section 37, subdivision 64.132, is amended to read:64.14    Subd. 2. Use of revenues. (a) Revenues received from the tax authorized by 64.15subdivision 1 by the city of St. Cloud must be used for the cost of collecting and 64.16administering the tax and to pay all or part of the capital or administrative costs of the 64.17development, acquisition, construction, improvement, and securing and paying debt 64.18service on bonds or other obligations issued to finance the following regional projects as 64.19approved by the voters and specifically detailed in the referendum authorizing the tax or 64.20extending the tax:64.21    (1) St. Cloud Regional Airport;64.22    (2) regional transportation improvements;64.23    (3) regional community and aquatics centers and facilities;64.24    (4) regional public libraries; and 64.25    (5) acquisition and improvement of regional park land and open space.64.26    (b) Revenues received from the tax authorized by subdivision 1 by the cities of St. 64.27Joseph, Waite Park, Sartell, Sauk Rapids, and St. Augusta must be used for the cost of 64.28collecting and administering the tax and to pay all or part of the capital or administrative 64.29costs of the development, acquisition, construction, improvement, and securing and paying 64.30debt service on bonds or other obligations issued to fund the projects specifically approved 64.31by the voters at the referendum authorizing the tax or extending the tax. The portion of 64.32revenues from the city going to fund the regional airport or regional library located in the 64.33city of St. Cloud will be as required under the applicable joint powers agreement.65.1    (c) The use of revenues received from the taxes authorized in subdivision 1 for 65.2projects allowed under paragraphs (a) and (b) are limited to the amount authorized for 65.3each project under the enabling referendum.65.4EFFECTIVE DATE.This section is effective for the city that approves them the 65.5day after compliance by the governing body of each city with Minnesota Statutes, section 65.6645.021, subdivision 3.65.7    Sec. 13. Laws 2005, First Special Session chapter 3, article 5, section 37, subdivision 65.84, is amended to read:65.9    Subd. 4. Termination of tax. The tax imposed in the cities of St. Joseph, St. Cloud, 65.10St. Augusta, Sartell, Sauk Rapids, and Waite Park under subdivision 1 expires when the 65.11city council determines that sufficient funds have been collected from the tax to retire or 65.12redeem the bonds and obligations authorized under subdivision 2, paragraph (a), but no 65.13later than December 31, 2018. Notwithstanding Minnesota Statutes, section 297A.99, 65.14subdivision 3, paragraphs (a), (c), and (d), a city may extend the tax imposed under 65.15subdivision 1 through December 31, 2038, if approved under the referendum authorizing 65.16the tax under subdivision 1 or if approved by voters of the city at a general election held 65.17no later than November 6, 2017.65.18EFFECTIVE DATE.This section is effective for the city that approves them the 65.19day after compliance by the governing body of each city with Minnesota Statutes, section 65.20645.021, subdivision 3.65.21    Sec. 14. Laws 2008, chapter 366, article 7, section 19, subdivision 3, as amended by 65.22Laws 2011, First Special Session chapter 7, article 4, section 8, is amended to read:65.23    Subd. 3. Use of revenues. Notwithstanding Minnesota Statutes, section 
         297A.99, 65.24subdivision 3
         , paragraph (b), the proceeds of the tax imposed under this section shall be 65.25used to pay for the costs of improvements to the Sportsman Park/Ballfields, Riverside 65.26Park, Lions Park/Pavilion, Cedar South Park also known as Eldorado Park, and Spring 65.27Street Park; improvements to and extension of the River County bike trail; acquisition,65.28and construction, improvement, and development of regional parks, bicycle trails, park 65.29land, open space, andof a pedestrian walkways, as described in the city improvement plan 65.30adopted by the city council by resolution on December 12, 2006, and walkway over 65.31Interstate 94 and State Highway 24; and the acquisition of land and construction of 65.32buildings for a community and recreation center. The total amount of revenues from the 66.1taxes in subdivisions 1 and 2 that may be used to fund these projects is $12,000,000 66.2plus any associated bond costs.66.3EFFECTIVE DATE.This section is effective the day after compliance by the 66.4governing body of the city of Clearwater with Minnesota Statutes, section 645.021, 66.5subdivisions 2 and 3.66.6    Sec. 15.  REPEALER.66.7(a) Minnesota Statutes 2011 Supplement, section 289A.60, subdivision 31, is 66.8repealed. 66.9(b) Laws 2009, chapter 88, article 4, section 23, as amended by Laws 2010, chapter 66.10389, article 5, section 4, is repealed.66.11EFFECTIVE DATE.Paragraph (a) is effective for taxes due and payable after June 66.1230, 2012. Paragraph (b) is effective the day following final enactment.66.13ARTICLE 466.14LOCAL DEVELOPMENT66.15    Section 1. Minnesota Statutes 2010, section 469.174, subdivision 2, is amended to read:66.16    Subd. 2. Authority. "Authority" means a rural development financing authority 66.17created pursuant to sections 
         469.142 to 
         469.151; a housing and redevelopment authority 66.18created pursuant to sections 
         469.001 to 
         469.047; a port authority created pursuant to 66.19sections 
         469.048 to 
         469.068; an economic development authority created pursuant to 66.20sections 
         469.090 to 
         469.108; a redevelopment agency as defined in sections 
         469.152 to 66.21469.165
         ; a municipality that is administering a development district created pursuant to 66.22sections 
         469.124 to 
         469.134 or any special law; a municipality that undertakes a project 66.23pursuant to sections 
         469.152 to 
         469.165, except a town located outside the metropolitan 66.24area or with a population of 5,000 persons or less; a municipality that undertakes a project 66.25located in an area designated under subdivision 30; or a municipality that exercises the 66.26powers of a port authority pursuant to any general or special law.66.27EFFECTIVE DATE.This section is effective the day following final enactment.66.28    Sec. 2. Minnesota Statutes 2010, section 469.174, subdivision 10, is amended to read:66.29    Subd. 10. Redevelopment district. (a) "Redevelopment district" means a type of 66.30tax increment financing district consisting of a project, or portions of a project, within 66.31which the authority finds by resolution that one or more of the following conditions, 66.32reasonably distributed throughout the district, exists:67.1    (1) parcels consisting of 70 percent of the area of the district are occupied by 67.2buildings, streets, utilities, paved or gravel parking lots, or other similar structures and 67.3more than 50 percent or more of the buildings, not including outbuildings, are structurally 67.4substandard to a degree requiring substantial renovation or clearance;67.5    (2) the property consists of vacant, unused, underused, inappropriately used, or 67.6infrequently used rail yards, rail storage facilities, or excessive or vacated railroad 67.7rights-of-way;67.8    (3) tank facilities, or property whose immediately previous use was for tank 67.9facilities, as defined in section 
         115C.02, subdivision 15, if the tank facilities:67.10    (i) have or had a capacity of more than 1,000,000 gallons;67.11    (ii) are located adjacent to rail facilities; and67.12    (iii) have been removed or are unused, underused, inappropriately used, or 67.13infrequently used; or67.14    (4) a qualifying disaster area, as defined in subdivision 10b.67.15    (b) For purposes of this subdivision, "structurally substandard" shall mean 67.16containing defects in structural elements or a combination of deficiencies in essential 67.17utilities and facilities, light and ventilation, fire protection including adequate egress, 67.18layout and condition of interior partitions, or similar factors, which defects or deficiencies 67.19are of sufficient total significance to justify substantial renovation or clearance.67.20    (c) A building is not structurally substandard if it is in compliance with the building 67.21code applicable to new buildings or could be modified to satisfy the building code at 67.22a cost of less than 15 percent of the cost of constructing a new structure of the same 67.23square footage and type on the site. The municipality may find that a building is not 67.24disqualified as structurally substandard under the preceding sentence on the basis of 67.25reasonably available evidence, such as the size, type, and age of the building, the average 67.26cost of plumbing, electrical, or structural repairs, or other similar reliable evidence. The 67.27municipality may not make such a determination without an interior inspection of the 67.28property, but need not have an independent, expert appraisal prepared of the cost of repair 67.29and rehabilitation of the building. An interior inspection of the property is not required, 67.30if the municipality finds that (1) the municipality or authority is unable to gain access to 67.31the property after using its best efforts to obtain permission from the party that owns or 67.32controls the property; and (2) the evidence otherwise supports a reasonable conclusion that 67.33the building is structurally substandard. Items of evidence that support such a conclusion 67.34include recent fire or police inspections, on-site property tax appraisals or housing 67.35inspections, exterior evidence of deterioration, or other similar reliable evidence. Written 67.36documentation of the findings and reasons why an interior inspection was not conducted 68.1must be made and retained under section 
         469.175, subdivision 3, clause (1). Failure of a 68.2building to be disqualified under the provisions of this paragraph is a necessary, but not a 68.3sufficient, condition to determining that the building is substandard.68.4    (d) A parcel is deemed to be occupied by a structurally substandard building 68.5for purposes of the finding under paragraph (a) or by the improvements described in 68.6paragraph (e) if all of the following conditions are met:68.7    (1) the parcel was occupied by a substandard building or met the requirements 68.8of paragraph (e), as the case may be, within three years of the filing of the request for 68.9certification of the parcel as part of the district with the county auditor;68.10    (2) the substandard building or the improvements described in paragraph (e) were 68.11demolished or removed by the authority or the demolition or removal was financed by the 68.12authority or was done by a developer under a development agreement with the authority;68.13    (3) the authority found by resolution before the demolition or removal that the 68.14parcel was occupied by a structurally substandard building or met the requirements of 68.15paragraph (e) and that after demolition and clearance the authority intended to include 68.16the parcel within a district; and68.17    (4) upon filing the request for certification of the tax capacity of the parcel as part 68.18of a district, the authority notifies the county auditor that the original tax capacity of the 68.19parcel must be adjusted as provided by section 
         469.177, subdivision 1, paragraph (f).68.20    (e) For purposes of this subdivision, a parcel is not occupied by buildings, streets, 68.21utilities, paved or gravel parking lots, or other similar structures unless 15 percent of the 68.22area of the parcel contains buildings, streets, utilities, paved or gravel parking lots, or 68.23other similar structures.68.24    (f) For districts consisting of two or more noncontiguous areas, each area must 68.25qualify as a redevelopment district under paragraph (a) to be included in the district, and 68.26the entire area of the district must satisfy paragraph (a).68.27EFFECTIVE DATE.This section is effective the day following final enactment.68.28    Sec. 3. Minnesota Statutes 2010, section 469.174, is amended by adding a subdivision 68.29to read:68.30    Subd. 19a.Soil deficiency district."Soil deficiency district" means a type of tax 68.31increment financing district consisting of a project, or portions of a project, within which 68.32the authority finds by resolution that the following conditions exist:68.33(1) parcels consisting of 70 percent of the area of the district contain unusual terrain 68.34or soil deficiencies which require substantial filling, grading, or other physical preparation 69.1for use and a parcel is eligible for inclusion if at least 50 percent of the area of the parcel 69.2requires substantial filling, grading, or other physical preparation for use; and69.3(2) the estimated cost of the physical preparation under clause (1), but excluding 69.4costs directly related to roads as defined in section 160.01, and local improvements as 69.5described in sections 429.021, subdivision 1, clauses (1) to (7), (11), and (12), and 430.01, 69.6exceeds the fair market value of the land before completion of the preparation.69.7EFFECTIVE DATE.This section is effective for districts for which the request for 69.8certification is made after April 30, 2012.69.9    Sec. 4. Minnesota Statutes 2010, section 469.174, is amended by adding a subdivision 69.10to read:69.11    Subd. 30.Mining reclamation project area.(a) An authority may designate an 69.12area within its jurisdiction as a mining reclamation project area by finding by resolution, 69.13that parcels consisting of at least 70 percent of the acreage, excluding street and railroad 69.14rights-of-way, are characterized by one or more of the following conditions:69.15(1) peat or other soils with geotechnical deficiencies that impair development of 69.16buildings or infrastructure;69.17(2) soils or terrain that requires substantial filling in order to permit the development 69.18of buildings or infrastructure;69.19(3) landfills, dumps, or similar deposits of municipal or private waste;69.20(4) quarries or similar resource extraction sites;69.21(5) floodway; and69.22(6) substandard buildings, within the meaning of section 469.174, subdivision 10.69.23(b) For the purposes of paragraph (a), clauses (1) to (5), a parcel is characterized by 69.24the relevant condition if at least 50 percent of the area of the parcel contains the relevant 69.25condition. For the purposes of paragraph (a), clause (6), a parcel is characterized by 69.26substandard buildings if substandard buildings occupy at least 30 percent of the area 69.27of the parcel.69.28EFFECTIVE DATE.This section is effective for districts for which the request for 69.29certification is made after April 30, 2012.69.30    Sec. 5. Minnesota Statutes 2010, section 469.175, subdivision 3, is amended to read:69.31    Subd. 3. Municipality approval. (a) A county auditor shall not certify the original 69.32net tax capacity of a tax increment financing district until the tax increment financing plan 69.33proposed for that district has been approved by the municipality in which the district 70.1is located. If an authority that proposes to establish a tax increment financing district 70.2and the municipality are not the same, the authority shall apply to the municipality in 70.3which the district is proposed to be located and shall obtain the approval of its tax 70.4increment financing plan by the municipality before the authority may use tax increment 70.5financing. The municipality shall approve the tax increment financing plan only after a 70.6public hearing thereon after published notice in a newspaper of general circulation in the 70.7municipality at least once not less than ten days nor more than 30 days prior to the date 70.8of the hearing. The published notice must include a map of the area of the district from 70.9which increments may be collected and, if the project area includes additional area, a map 70.10of the project area in which the increments may be expended. The hearing may be held 70.11before or after the approval or creation of the project or it may be held in conjunction with 70.12a hearing to approve the project.70.13    (b) Before or at the time of approval of the tax increment financing plan, the 70.14municipality shall make the following findings, and shall set forth in writing the reasons 70.15and supporting facts for each determination:70.16    (1) that the proposed tax increment financing district is a redevelopment district, a 70.17renewal or renovation district, a housing district, a soils condition district, soil deficiency 70.18district, or an economic development district; if the proposed district is a redevelopment 70.19district or a renewal or renovation district, the reasons and supporting facts for the 70.20determination that the district meets the criteria of section 
         469.174, subdivision 10, 70.21paragraph (a), clauses (1) and (2), or subdivision 10a, must be documented in writing 70.22and retained and made available to the public by the authority until the district has been 70.23terminated;70.24    (2) that, in the opinion of the municipality:70.25    (i) the proposed development or redevelopment would not reasonably be expected to 70.26occur solely through private investment within the reasonably foreseeable future; and70.27    (ii) the increased market value of the site that could reasonably be expected to occur 70.28without the use of tax increment financing would be less than the increase in the market 70.29value estimated to result from the proposed development after subtracting the present 70.30value of the projected tax increments for the maximum duration of the district permitted 70.31by the plan. The requirements of this item do not apply if the district is a housing district;70.32    (3) that the tax increment financing plan conforms to the general plan for the 70.33development or redevelopment of the municipality as a whole;70.34    (4) that the tax increment financing plan will afford maximum opportunity, 70.35consistent with the sound needs of the municipality as a whole, for the development or 70.36redevelopment of the project by private enterprise;71.1    (5) that the municipality elects the method of tax increment computation set forth in 71.2section 
         469.177, subdivision 3, paragraph (b), if applicable; and71.3(6) that for a redevelopment district, renewal and renovation district, soils condition 71.4district, or soil deficiency district established by the authority in a mining reclamation 71.5project area, the reasons and supporting facts for the determination that the mining 71.6reclamation project area meets the requirements under section 469.174, subdivision 30, 71.7must be documented in writing and retained and made available to the public by the 71.8authority until two years after the district is decertified. These findings must have been 71.9made and documented no more than ten years before approval of the tax increment 71.10financing plan for the district.71.11    (c) When the municipality and the authority are not the same, the municipality shall 71.12approve or disapprove the tax increment financing plan within 60 days of submission by 71.13the authority. When the municipality and the authority are not the same, the municipality 71.14may not amend or modify a tax increment financing plan except as proposed by the 71.15authority pursuant to subdivision 4. Once approved, the determination of the authority 71.16to undertake the project through the use of tax increment financing and the resolution of 71.17the governing body shall be conclusive of the findings therein and of the public need for 71.18the financing.71.19    (d) For a district that is subject to the requirements of paragraph (b), clause (2), 71.20item (ii), the municipality's statement of reasons and supporting facts must include all of 71.21the following:71.22    (1) an estimate of the amount by which the market value of the site will increase 71.23without the use of tax increment financing;71.24    (2) an estimate of the increase in the market value that will result from the 71.25development or redevelopment to be assisted with tax increment financing; and71.26    (3) the present value of the projected tax increments for the maximum duration of 71.27the district permitted by the tax increment financing plan.71.28    (e) For purposes of this subdivision, "site" means the parcels on which the 71.29development or redevelopment to be assisted with tax increment financing will be located.71.30EFFECTIVE DATE.This section is effective for districts for which the request for 71.31certification is made after April 30, 2012.71.32    Sec. 6. Minnesota Statutes 2010, section 469.176, subdivision 1b, is amended to read:71.33    Subd. 1b. Duration limits; terms. (a) No tax increment shall in any event be 71.34paid to the authority:72.1(1) after 15 years after receipt by the authority of the first increment for a renewal 72.2and renovation district;72.3(2) after 20 years after receipt by the authority of the first increment for a soils 72.4condition district or a soil deficiency district;72.5(3) after eight years after receipt by the authority of the first increment for an 72.6economic development district;72.7(4) for a housing district, a compact development district, or a redevelopment 72.8district, after 25 years from the date of receipt by the authority of the first increment.72.9(b) For purposes of determining a duration limit under this subdivision or subdivision 72.101e that is based on the receipt of an increment, any increments from taxes payable in 72.11the year in which the district terminates shall be paid to the authority. This paragraph 72.12does not affect a duration limit calculated from the date of approval of the tax increment 72.13financing plan or based on the recovery of costs or to a duration limit under subdivision 72.141c. This paragraph does not supersede the restrictions on payment of delinquent taxes in 72.15subdivision 1f.72.16(c) An action by the authority to waive or decline to accept an increment has no 72.17effect for purposes of computing a duration limit based on the receipt of increment under 72.18this subdivision or any other provision of law. The authority is deemed to have received an 72.19increment for any year in which it waived or declined to accept an increment, regardless 72.20of whether the increment was paid to the authority.72.21(d) Receipt by a hazardous substance subdistrict of an increment as a result of a 72.22reduction in original net tax capacity under section 
         469.174, subdivision 7, paragraph 72.23(b), does not constitute receipt of increment by the overlying district for the purpose of 72.24calculating the duration limit under this section.72.25EFFECTIVE DATE.This section is effective for districts for which the request for 72.26certification is made after April 30, 2012.72.27    Sec. 7. Minnesota Statutes 2010, section 469.176, subdivision 4b, is amended to read:72.28    Subd. 4b. Soils condition districts. Revenue derived from Tax increment from a 72.29soils condition district may be used only to (1) acquire parcels on which the improvements 72.30described in clause (2) will occur; (2) pay for the cost of removal or remedial action; and 72.31(3) pay for the administrative expenses of the authority allocable to the district, including 72.32the cost of preparation of the development action response plan. For a soils condition 72.33district located in a mining reclamation project area, tax increments may also be expended 72.34on the additional cost of public improvements directly caused by the removal or remedial 72.35action and located within the mining reclamation project area.73.1EFFECTIVE DATE.This section is effective for districts for which the request for 73.2certification is made after April 30, 2012.73.3    Sec. 8. Minnesota Statutes 2011 Supplement, section 469.176, subdivision 4c, is 73.4amended to read:73.5    Subd. 4c. Economic development districts. (a) Revenue derived from tax 73.6increment from an economic development district may not be used to provide 73.7improvements, loans, subsidies, grants, interest rate subsidies, or assistance in any form 73.8to developments consisting of buildings and ancillary facilities, if more than 15 percent 73.9of the buildings and facilities (determined on the basis of square footage) are used for a 73.10purpose other than:73.11    (1) the manufacturing or production of tangible personal property, including 73.12processing resulting in the change in condition of the property;73.13    (2) warehousing, storage, and distribution of tangible personal property, excluding 73.14retail sales;73.15    (3) research and development related to the activities listed in clause (1) or (2);73.16    (4) telemarketing if that activity is the exclusive use of the property;73.17    (5) tourism facilities;73.18    (6) qualified border retail facilities; or73.19    (7) space necessary for and related to the activities listed in clauses (1) to (6).73.20    (b) Notwithstanding the provisions of this subdivision, revenues derived from tax 73.21increment from an economic development district may be used to provide improvements, 73.22loans, subsidies, grants, interest rate subsidies, or assistance in any form for up to 15,000 73.23square feet of any separately owned commercial facility located within the municipal 73.24jurisdiction of a small city, if the revenues derived from increments are spent only to 73.25assist the facility directly or for administrative expenses, the assistance is necessary to 73.26develop the facility, and all of the increments, except those for administrative expenses, 73.27are spent only for activities within the district.73.28    (c) A city is a small city for purposes of this subdivision if the city was a small city 73.29in the year in which the request for certification was made and applies for the rest of 73.30the duration of the district, regardless of whether the city qualifies or ceases to qualify 73.31as a small city.73.32    (d) Notwithstanding the requirements of paragraph (a) and the finding requirements 73.33of section 
         469.174, subdivision 12, tax increments from an economic development district 73.34may be used to provide improvements, loans, subsidies, grants, interest rate subsidies, or 74.1assistance in any form to developments consisting of buildings and ancillary facilities, if 74.2all the following conditions are met:74.3    (1) the municipality finds that the project will create or retain jobs in this state, 74.4including construction jobs, and that construction of the project would not have 74.5commenced before July 1, 2012 January 1, 2014, without the authority providing 74.6assistance under the provisions of this paragraph;74.7    (2) construction of the project begins no later than July 1, 2012 January 1, 2014;74.8    (3) the request for certification of the district is made no later than June 30, 201274.9December 31, 2013; and74.10    (4) for development of housing under this paragraph, the construction must begin 74.11before January 1, 2012.74.12    The provisions of this paragraph may not be used to assist housing that is developed 74.13to qualify under section 
         469.1761, subdivision 2 or 3, or similar requirements of other law, 74.14if construction of the project begins later than July 1, 2011.74.15EFFECTIVE DATE.This section is effective the day following final enactment.74.16    Sec. 9. Minnesota Statutes 2011 Supplement, section 469.176, subdivision 4m, is 74.17amended to read:74.18    Subd. 4m. Temporary authority to stimulate construction. (a) Notwithstanding 74.19the restrictions in any other subdivision of this section or any other law to the contrary, 74.20except the requirement to pay bonds to which the increments are pledged and the 74.21provisions of subdivisions 4g and 4h, the authority may spend tax increments for one or 74.22more of the following purposes:74.23    (1) to provide improvements, loans, interest rate subsidies, or assistance in any 74.24form to private development consisting of the construction or substantial rehabilitation of 74.25buildings and ancillary facilities, if doing so will create or retain jobs in this state, including 74.26construction jobs, and that the construction commences before July 1, 2012 January 1, 74.272014, and would not have commenced before that date without the assistance; or74.28    (2) to make an equity or similar investment in a corporation, partnership, or limited 74.29liability company that the authority determines is necessary to make construction of a 74.30development that meets the requirements of clause (1) financially feasible.74.31    (b) The authority may undertake actions under the authority of this subdivision only 74.32after approval by the municipality of a written spending plan that specifically authorizes 74.33the authority to take the actions. The municipality shall approve the spending plan only 74.34after a public hearing after published notice in a newspaper of general circulation in 75.1the municipality at least once, not less than ten days nor more than 30 days prior to the 75.2date of the hearing.75.3    (c) The authority to spend tax increments under this subdivision expires December 75.431, 2012 June 30, 2014.75.5    (d) For a development consisting of housing, the authority to spend tax increments 75.6under this subdivision expires December 31, 2011, and construction must commence 75.7before July 1, 2011, except the authority to spend tax increments on market rate housing 75.8developments under this subdivision expires July 31, 2012, and construction must 75.9commence before January 1, 2012.75.10EFFECTIVE DATE.This section is effective the day following final enactment 75.11and applies to all tax increment financing districts, regardless of when the request for 75.12certification was made.75.13    Sec. 10. Minnesota Statutes 2010, section 469.176, is amended by adding a subdivision 75.14to read:75.15    Subd. 4n.Soil deficiency district.Tax increments from a soil deficiency district 75.16may only be used to pay for the following costs for activities located within the mining 75.17reclamation project area:75.18(1) acquisition of parcels on which the improvements described in clause (2) will 75.19occur;75.20(2) the cost of correcting the unusual terrain or soil deficiencies and the additional 75.21cost of installing public improvements directly caused by the deficiencies;75.22(3) administrative expenses of the authority allocable to the district; and75.23(4) costs described in subdivision 4j for the district, if these payments do not exceed 75.2425 percent of the tax increment from the district.75.25EFFECTIVE DATE.This section is effective for districts for which the request for 75.26certification is made after April 30, 2012.75.27    Sec. 11. Minnesota Statutes 2011 Supplement, section 469.1763, subdivision 2, 75.28is amended to read:75.29    Subd. 2. Expenditures outside district. (a) For each tax increment financing 75.30district, an amount equal to at least 75 percent of the total revenue derived from tax 75.31increments paid by properties in the district must be expended on activities in the district 75.32or to pay bonds, to the extent that the proceeds of the bonds were used to finance activities 75.33in the district or to pay, or secure payment of, debt service on credit enhanced bonds. 76.1For districts, other than redevelopment districts for which the request for certification 76.2was made after June 30, 1995, the in-district percentage for purposes of the preceding 76.3sentence is 80 percent. Not more than 25 percent of the total revenue derived from tax 76.4increments paid by properties in the district may be expended, through a development fund 76.5or otherwise, on activities outside of the district but within the defined geographic area of 76.6the project except to pay, or secure payment of, debt service on credit enhanced bonds. 76.7For districts, other than redevelopment districts for which the request for certification was 76.8made after June 30, 1995, the pooling percentage for purposes of the preceding sentence is 76.920 percent. The revenue derived from tax increments for the district that are expended on 76.10costs under section 
         469.176, subdivision 4h, paragraph (b), may be deducted first before 76.11calculating the percentages that must be expended within and without the district.76.12    (b) In the case of a housing district, a housing project, as defined in section 
         469.174, 76.13subdivision 11
         , is an activity in the district.76.14    (c) All administrative expenses are for activities outside of the district, except that 76.15if the only expenses for activities outside of the district under this subdivision are for 76.16the purposes described in paragraph (d), administrative expenses will be considered as 76.17expenditures for activities in the district.76.18    (d) The authority may elect, in the tax increment financing plan for the district, 76.19to increase by up to ten percentage points the permitted amount of expenditures for 76.20activities located outside the geographic area of the district under paragraph (a). As 76.21permitted by section 
         469.176, subdivision 4k, the expenditures, including the permitted 76.22expenditures under paragraph (a), need not be made within the geographic area of the 76.23project. Expenditures that meet the requirements of this paragraph are legally permitted 76.24expenditures of the district, notwithstanding section 
         469.176, subdivisions 4b, 4c, 4d, and 76.254j
         . To qualify for the increase under this paragraph, the expenditures must:76.26    (1) be used exclusively to assist housing that76.27(i) meets the requirement for a qualified low-income building, as that term is used in 76.28section 42 of the Internal Revenue Code; and76.29    (2) (ii) does not exceed the qualified basis of the housing, as defined under section 76.3042(c) of the Internal Revenue Code, less the amount of any credit allowed under section 76.3142 of the Internal Revenue Code; and76.32    (3) be (iii) is used to:76.33    (i) (A) acquire and prepare the site of the housing;76.34    (ii) (B) acquire, construct, or rehabilitate the housing; or76.35    (iii) (C) make public improvements directly related to the housing; or76.36(4) (2) be used to develop housing:77.1(i) if the market value of the housing  prior to demolition or rehabilitation does 77.2not exceed the lesser of:77.3(A) 150 percent of the average market value of single-family homes in that 77.4municipality; or77.5(B) $200,000 for municipalities located in the metropolitan area, as defined in 77.6section 
         473.121, or $125,000 for all other municipalities; and77.7(ii) if the expenditures are used to pay the cost of site acquisition, relocation, 77.8demolition of existing structures, site preparation, rehabilitation, and pollution abatement 77.9on one or more parcels, if provided that the parcel contains a residence containing is 77.10occupied by one to four family dwelling units that has been vacant for six or more months 77.11and is in foreclosure as defined in section 325N.10, subdivision 7, but without regard to 77.12whether the residence is the owner's principal residence, and only after the redemption 77.13period stated in the notice provided under section 580.06 has expired with respect to which 77.14a mortgage was foreclosed under chapter 580, 581, or 582; any applicable redemption 77.15period has expired without redemption; and the authority or developer enters into a 77.16purchase agreement to acquire the parcel no earlier than 30 days after expiration of the 77.17redemption period.77.18    (e) For a district created within a biotechnology and health sciences industry zone 77.19as defined in section 
         469.330, subdivision 6, or for an existing district located within 77.20such a zone, tax increment derived from such a district may be expended outside of the 77.21district but within the zone only for expenditures required for the construction of public 77.22infrastructure necessary to support the activities of the zone, land acquisition, and other 77.23redevelopment costs as defined in section 
         469.176, subdivision 4j. These expenditures are 77.24considered as expenditures for activities within the district.77.25(f) The authority under paragraph (d), clause (4) (2), expires on December 31, 2016. 77.26Increments may continue to be expended under this authority after that date, if they are 77.27used to pay bonds or binding contracts that would qualify under subdivision 3, paragraph 77.28(a), if December 31, 2016, is considered to be the last date of the five-year period after 77.29certification under that provision.77.30(g) The authority may elect, in the tax increment financing plan, for a district located 77.31in a mining reclamation area that "activities within the district" under paragraph (a) 77.32includes activities within the geographic area of the mining reclamation area.77.33EFFECTIVE DATE.This section is effective for any district that is subject to 77.34the provisions of Minnesota Statutes, section 469.1763, regardless of when the request 77.35for certification was made, except the amendment adding paragraph (g) is effective for 77.36districts for which the request for certification was made after April 30, 2012.78.1    Sec. 12. Minnesota Statutes 2010, section 469.1763, subdivision 3, is amended to read:78.2    Subd. 3. Five-year rule. (a) Revenues derived from tax increments are considered 78.3to have been expended on an activity within the district under subdivision 2 only if one 78.4of the following occurs:78.5(1) before or within five years after certification of the district, the revenues are 78.6actually paid to a third party with respect to the activity;78.7(2) bonds, the proceeds of which must be used to finance the activity, are issued and 78.8sold to a third party before or within five years after certification, the revenues are spent 78.9to repay the bonds, and the proceeds of the bonds either are, on the date of issuance, 78.10reasonably expected to be spent before the end of the later of (i) the five-year period, or 78.11(ii) a reasonable temporary period within the meaning of the use of that term under section 78.12148(c)(1) of the Internal Revenue Code, or are deposited in a reasonably required reserve 78.13or replacement fund;78.14(3) binding contracts with a third party are entered into for performance of the 78.15activity before or within five years after certification of the district and the revenues are 78.16spent under the contractual obligation;78.17(4) costs with respect to the activity are paid before or within five years after 78.18certification of the district and the revenues are spent to reimburse a party for payment 78.19of the costs, including interest on unreimbursed costs; or78.20(5) expenditures are made for housing purposes as permitted by subdivision 2, 78.21paragraphs (b) and (d), or for public infrastructure purposes within a zone as permitted 78.22by subdivision 2, paragraph (e).78.23(b) For purposes of this subdivision, bonds include subsequent refunding bonds if 78.24the original refunded bonds meet the requirements of paragraph (a), clause (2).78.25(c) For a redevelopment district or a renewal and renovation district certified after 78.26June 30, 2003, and before April 20, 2009, the five-year periods described in paragraph 78.27(a) are extended to ten years after certification of the district. This extension is provided 78.28primarily to accommodate delays in development activities due to unanticipated economic 78.29circumstances.78.30(d) If the authority so elects in the tax increment financing plan for a redevelopment 78.31district, renewal and renovation district, soils condition district, or soil deficiency district 78.32located in a mining reclamation project area, the five-year periods described in paragraph 78.33(a) do not apply.78.34EFFECTIVE DATE.This section is effective for districts for which the request for 78.35certification is made after April 30, 2012.79.1    Sec. 13. Minnesota Statutes 2010, section 469.1763, subdivision 4, is amended to read:79.2    Subd. 4. Use of revenues for decertification. (a) In each year beginning with the 79.3sixth year following certification of the district, if the applicable in-district percent of the 79.4revenues derived from tax increments paid by properties in the district exceeds the amount 79.5of expenditures that have been made for costs permitted under subdivision 3, an amount 79.6equal to the difference between the in-district percent of the revenues derived from tax 79.7increments paid by properties in the district and the amount of expenditures that have 79.8been made for costs permitted under subdivision 3 must be used and only used to pay or 79.9defease the following or be set aside to pay the following:79.10(1) outstanding bonds, as defined in subdivision 3, paragraphs (a), clause (2), and (b);79.11(2) contracts, as defined in subdivision 3, paragraph (a), clauses (3) and (4);79.12(3) credit enhanced bonds to which the revenues derived from tax increments are 79.13pledged, but only to the extent that revenues of the district for which the credit enhanced 79.14bonds were issued are insufficient to pay the bonds and to the extent that the increments 79.15from the applicable pooling percent share for the district are insufficient; or79.16(4) the amount provided by the tax increment financing plan to be paid under 79.17subdivision 2, paragraphs (b), (d), and (e).79.18(b) The district must be decertified and the pledge of tax increment discharged 79.19when the outstanding bonds have been defeased and when sufficient money has been set 79.20aside to pay, based on the increment to be collected through the end of the calendar year, 79.21the following amounts:79.22(1) contractual obligations as defined in subdivision 3, paragraph (a), clauses (3) 79.23and (4);79.24(2) the amount specified in the tax increment financing plan for activities qualifying 79.25under subdivision 2, paragraph (b), that have not been funded with the proceeds of bonds 79.26qualifying under paragraph (a), clause (1); and79.27(3) the additional expenditures permitted by the tax increment financing plan for 79.28housing activities under an election under subdivision 2, paragraph (d), that have not been 79.29funded with the proceeds of bonds qualifying under paragraph (a), clause (1).79.30(c) If the authority so elects in the tax increment financing plan for a redevelopment 79.31district, renewal and renovation district, soils condition district, or soil deficiency district 79.32located in a mining reclamation project area, the provisions of this section do not apply.79.33EFFECTIVE DATE.This section is effective for districts for which the request for 79.34certification is made after April 30, 2012.80.1    Sec. 14. Laws 2008, chapter 366, article 5, section 34, as amended by Laws 2009, 80.2chapter 88, article 5, section 11, is amended to read:80.3    Sec. 34. CITY OF OAKDALE; ORIGINAL TAX CAPACITY. 80.4    Subdivision 1.Original tax capacity election. (a) The provisions of this section 80.5apply to redevelopment tax increment financing districts created by the Housing and 80.6Redevelopment Authority in and for the city of Oakdale in the areas comprised of 80.7the parcels with the following parcel identification numbers: (1) 3102921320053; 80.83102921320054; 3102921320055; 3102921320056; 3102921320057; 3102921320058; 80.93102921320062; 3102921320063; 3102921320059; 3102921320060; 3102921320061; 80.103102921330005; and 3102921330004; and (2) 2902921330001 and 2902921330005.80.11    (b) For a district subject to this section, the Housing and Redevelopment Authority 80.12may, when requesting certification of the original tax capacity of the district under 80.13Minnesota Statutes, section 
         469.177, elect to have the original tax capacity of the district 80.14be certified as the tax capacity of the land.80.15    (c) The authority to request certification of a district under this section expires on 80.16July 1, 2013 December 31, 2017.80.17    Subd. 2.Parcels deemed occupied.(a) Parcel numbers 3102921320054, 80.183102921320055, 3102921320056, 3102921320057, 3102921320061, and 3102921330004 80.19are deemed to meet the requirements of Minnesota Statutes, section 469.174, subdivision 80.2010, paragraph (d), notwithstanding any contrary provisions of that paragraph, if the 80.21following conditions are met:80.22(1) a building located on any part of each of the specified parcels was demolished 80.23after the authority adopted a resolution under Minnesota Statutes, section 469.174, 80.24subdivision 10, paragraph (d), clause (3);80.25(2) the building was removed either by the authority, by a developer under a 80.26development agreement with the authority, or by the owner of the property without 80.27entering into a development agreement with the authority; and80.28(3) the request for certification of the parcel as part of a district is filed with the 80.29county auditor by December 31, 2017.80.30(b) The provisions of subdivision 1 apply to allow an election by the authority 80.31for the parcels deemed occupied under paragraph (a), notwithstanding the provisions 80.32of Minnesota Statutes, sections 469.174, subdivision 10, paragraph (d), and 469.177, 80.33subdivision 1, paragraph (f).80.34EFFECTIVE DATE.This section is effective upon compliance by the governing 80.35body of the city of Oakdale with the requirements of Minnesota Statutes, section 645.021, 80.36subdivision 3.81.1    Sec. 15. CITY OF BLOOMINGTON; TAX INCREMENT FINANCING.81.2Notwithstanding Minnesota Statutes, section 469.176, or Laws 1996, chapter 464, 81.3article 1, section 8, or any other law to the contrary, the city of Bloomington and its port 81.4authority may extend the duration limits of tax increment financing district No. 1-G, 81.5containing the former Met Center property, including Lindau Lane and that portion of tax 81.6increment financing district No. 1-C north of the existing building line on Lot 1, Block 1, 81.7Mall of America 7th Addition, exclusive of Lots 2 and 3, through December 31, 2038.81.8EFFECTIVE DATE.This section is effective upon compliance of the governing 81.9bodies of the city of Bloomington, Hennepin County, and Independent School District 81.10No. 271, Bloomington, with the requirements of Minnesota Statutes, sections 469.1782, 81.11subdivision 2, and 645.021, subdivision 3.81.12    Sec. 16. CITY OF BLOOMINGTON; TAX INCREMENT FINANCING 81.13EXTENSION.81.14Notwithstanding the provisions of Minnesota Statutes, section 469.176, or any other 81.15law to the contrary, the city of Bloomington and its port authority may extend the duration 81.16limits of Tax Increment Financing District No. 1-I, containing the Bloomington Central 81.17Station property for a period through December 31, 2038.81.18EFFECTIVE DATE.This section is effective upon compliance of the governing 81.19body of the city of Bloomington with the requirements of Minnesota Statutes, sections 81.20469.1782, subdivision 2, and 645.021, subdivision 3.81.21    Sec. 17. DAKOTA COUNTY COMMUNITY DEVELOPMENT AUTHORITY; 81.22TAX INCREMENT FINANCING DISTRICT.81.23    Subdivision 1.Authorization.Notwithstanding the provisions of any other law, 81.24the Dakota County Community Development Authority may establish a redevelopment 81.25tax increment financing district comprised of the properties that (1) were included in the 81.26CDA 10 Robert and South Street district in the city of West St. Paul, and (2) were not 81.27decertified before July 1, 2012. The district created under this section terminates no later 81.28than December 31, 2027.81.29    Subd. 2.Special rules.The requirements for qualifying a redevelopment district 81.30under Minnesota Statutes, section 469.174, subdivision 10, do not apply to parcels located 81.31within the district. Minnesota Statutes, section 469.176, subdivisions 4g, paragraph (c), 82.1clause (1), item (ii), 4j, and 4l, do not apply to the district. The original tax capacity 82.2of the district is $93,239.82.3    Subd. 3.Authorized expenditures.Tax increment from the district may be 82.4expended to pay for any eligible activities authorized by Minnesota Statutes, chapter 82.5469, within the redevelopment area that includes the district. All such expenditures are 82.6deemed to be activities within the district under Minnesota Statutes, section 469.1763, 82.7subdivisions 2, 3, and 4.82.8    Subd. 4.Adjusted net tax capacity.The captured tax capacity of the district must 82.9be included in the adjusted net tax capacity of the city, county, and school district for the 82.10purposes of determining local government aid, education aid, and county program aid. 82.11The county auditor shall report to the commissioner of revenue the amount of the captured 82.12tax capacity for the district at the time the assessment abstracts are filed.82.13EFFECTIVE DATE.This section is effective upon compliance by the governing 82.14body of the Dakota County Community Development Authority with the requirements of 82.15Minnesota Statutes, section 645.021, subdivision 3.82.16    Sec. 18. CITY OF BROOKLYN PARK; TAX INCREMENT FINANCING; 82.17SPECIAL RULES.82.18The requirement of Minnesota Statutes, section 469.1763, subdivision 3, that 82.19activities must be undertaken within a five-year period from the date of certification of a tax 82.20increment financing district, is considered to be met for Tax Increment Financing District 82.21No. 23 in the city of Brooklyn Park if the activities were undertaken by July 1, 2014.82.22EFFECTIVE DATE.This section is effective upon compliance by the governing 82.23body of the city of Brooklyn Park with the requirements of Minnesota Statutes, section 82.24645.021, subdivision 3.82.25ARTICLE 582.26ESTATE TAXES82.27    Section 1. Minnesota Statutes 2010, section 289A.10, is amended by adding a 82.28subdivision to read:82.29    Subd. 1a.Recapture tax return required.If a disposition or cessation as provided 82.30by section 291.03, subdivision 11, paragraph (a), has occurred, the qualified heir, as 82.31defined under section 291.03, subdivision 8, paragraph (c), or personal representative of 82.32the decedent's estate must submit a recapture tax return to the commissioner.83.1EFFECTIVE DATE.This section is effective for estates of decedents dying after 83.2June 30, 2011.83.3    Sec. 2. Minnesota Statutes 2010, section 289A.12, is amended by adding a subdivision 83.4to read:83.5    Subd. 18.Returns by qualified heirs.Within 24 months and within 36 months 83.6after a decedent's death, a qualified heir, as defined under section 291.03, subdivision 8, 83.7paragraph (c), must file a return with the commissioner relating to the qualified property 83.8received from the decedent.83.9EFFECTIVE DATE.This section is effective for estates of decedents dying after 83.10June 30, 2011.83.11    Sec. 3. Minnesota Statutes 2010, section 289A.18, is amended by adding a subdivision 83.12to read:83.13    Subd. 3a.Recapture tax return.A recapture tax return is due within six months 83.14after the date of the disposition or cessation as provided by section 291.03, subdivision 83.1511, paragraph (a).83.16EFFECTIVE DATE.This section is effective for estates of decedents dying after 83.17June 30, 2011.83.18    Sec. 4. Minnesota Statutes 2010, section 289A.20, subdivision 3, is amended to read:83.19    Subd. 3. Estate tax. Taxes imposed by chapter 291 section 291.03, subdivision 1,83.20take effect at and upon the death of the person whose estate is subject to taxation and are 83.21due and payable on or before the expiration of nine months from that death.83.22EFFECTIVE DATE.This section is effective for estates of decedents dying after 83.23June 30, 2011.83.24    Sec. 5. Minnesota Statutes 2010, section 289A.20, is amended by adding a subdivision 83.25to read:83.26    Subd. 3a.Recapture tax.Taxes imposed by section 291.03, subdivision 11, 83.27paragraph (b), are due and payable on or before the expiration of six months from the date 83.28of disposition or cessation as provided by section 291.03, subdivision 11, paragraph (a).83.29EFFECTIVE DATE.This section is effective for estates of decedents dying after 83.30June 30, 2011.84.1    Sec. 6. Minnesota Statutes 2011 Supplement, section 291.03, subdivision 8, is 84.2amended to read:84.3    Subd. 8. Definitions. (a) For purposes of this section, the following terms have the 84.4meanings given in this subdivision.84.5(b) "Family member" means a family member as defined in section 2032A(e)(2) of 84.6the Internal Revenue Code or a trust whose present beneficiaries are all family members as 84.7defined in section 2032A(e)(2) of the Internal Revenue Code.84.8(c) "Qualified heir" means a family member who acquired qualified property from84.9upon the death of the decedent and satisfies the requirement under subdivision 9, clause 84.10(6) (7), or subdivision 10, clause (4) (5), for the property.84.11(d) "Qualified property" means qualified small business property under subdivision 84.129 and qualified farm property under subdivision 10.84.13EFFECTIVE DATE.This section is effective for estates of decedents dying after 84.14June 30, 2011.84.15    Sec. 7. Minnesota Statutes 2011 Supplement, section 291.03, subdivision 9, is 84.16amended to read:84.17    Subd. 9. Qualified small business property. Property satisfying all of the following 84.18requirements is qualified small business property:84.19(1) The value of the property was included in the federal adjusted taxable estate.84.20(2) The property consists of the assets of a trade or business or shares of stock or 84.21other ownership interests in a corporation or other entity engaged in a trade or business. 84.22The decedent or the decedent's spouse must have materially participated in the trade or 84.23business within the meaning of section 469 of the Internal Revenue Code during the 84.24taxable year that ended before the date of the decedent's death. Shares of stock in a 84.25corporation or an ownership interest in another type of entity do not qualify under this 84.26subdivision if the shares or ownership interests are traded on a public stock exchange at 84.27any time during the three-year period ending on the decedent's date of death. For purposes 84.28of this subdivision, an ownership interest includes the interest the decedent is deemed to 84.29own under sections 2036, 2037, and 2038 of the Internal Revenue Code.84.30(3) During the decedent's taxable year that ended before the decedent's death, the 84.31trade or business must not have been a passive activity within the meaning of section 84.32469(c) of the Internal Revenue Code and the decedent or the decedent's spouse must have 84.33materially participated in the trade or business within the meaning of section 469(h) of the 84.34Internal Revenue Code, excluding section 469(h)(3) of the Internal Revenue Code and 84.35any other provision provided by Treasury Department regulation that substitutes material 85.1participation in prior taxable years for material participation in the taxable year that ended 85.2before the decedent's death.85.3(3) (4) The gross annual sales of the trade or business were $10,000,000 or less for 85.4the last taxable year that ended before the date of the death of the decedent.85.5(4) (5) The property does not consist of cash or, cash equivalents, publicly traded 85.6securities, or assets not used in the operation of the trade or business. For property 85.7consisting of shares of stock or other ownership interests in an entity, the amount value of 85.8cash or, cash equivalents, publicly traded securities, or assets not used in the operation of 85.9the trade or business held by the corporation or other entity must be deducted from the 85.10value of the property qualifying under this subdivision in proportion to the decedent's 85.11share of ownership of the entity on the date of death.85.12(5) (6) The decedent continuously owned the property, including property the 85.13decedent is deemed to own under sections 2036, 2037, and 2038 of the Internal Revenue 85.14Code, for the three-year period ending on the date of death of the decedent. In the case of 85.15a sole proprietor, if the property replaced similar property within the three-year period, 85.16the replacement property will be treated as having been owned for the three-year period 85.17ending on the date of death of the decedent.85.18(6) A family member continuously uses the property in the operation of the trade or 85.19business for three years following the date of death of the decedent.85.20(7) For three years following the date of death of the decedent, the trade or business 85.21is not a passive activity within the meaning of section 469(c) of the Internal Revenue 85.22Code and a family member materially participates in the operation of the trade or business 85.23within the meaning of section 469(h) of the Internal Revenue Code, excluding section 85.24469(h)(3) of the Internal Revenue Code and any other provision provided by Treasury 85.25Department regulation that substitutes material participation in prior taxable years for 85.26material participation in the three years following the date of death of the decedent.85.27(7) (8) The estate and the qualified heir elect to treat the property as qualified small 85.28business property and agree, in the form prescribed by the commissioner, to pay the 85.29recapture tax under subdivision 11, if applicable.85.30EFFECTIVE DATE.This section is effective for estates of decedents dying after 85.31June 30, 2011.85.32    Sec. 8. Minnesota Statutes 2011 Supplement, section 291.03, subdivision 10, is 85.33amended to read:85.34    Subd. 10. Qualified farm property. Property satisfying all of the following 85.35requirements is qualified farm property:86.1(1) The value of the property was included in the federal adjusted taxable estate.86.2(2) The property consists of agricultural land as defined by section 500.24, 86.3subdivision 2, paragraph (g), and owned by a farm meeting the requirements of person 86.4or entity that is not excluded from owning agricultural land by section 
         500.24, and was 86.5classified for property tax purposes as the homestead of the decedent or the decedent's 86.6spouse or both under section 273.124, and as class 2a property under section 273.13, 86.7subdivision 23.86.8(3) For property taxes payable in the year of decedent's death, the decedent's interest 86.9in the property was classified as the homestead of the decedent or the decedent's spouse or 86.10both under section 273.124, and as class 2a property under section 273.13, subdivision 23.86.11(4) The decedent continuously owned the property, including property the decedent 86.12is deemed to own under sections 2036, 2037, and 2038 of the Internal Revenue Code, for 86.13the three-year period ending on the date of death of the decedent either by ownership of 86.14the agricultural land or pursuant to holding an interest in an entity that is not excluded 86.15from owning agricultural land under section 500.24.86.16(4) A family member continuously uses the property in the operation of the trade or 86.17business (5) The property is classified for property tax purposes as class 2a property under 86.18section 273.13, subdivision 23, for three years following the date of death of the decedent.86.19(5) (6) The estate and the qualified heir elect to treat the property as qualified farm 86.20property and agree, in a form prescribed by the commissioner, to pay the recapture tax 86.21under subdivision 11, if applicable.86.22EFFECTIVE DATE.This section is effective for estates of decedents dying after 86.23June 30, 2011.86.24    Sec. 9. Minnesota Statutes 2011 Supplement, section 291.03, subdivision 11, is 86.25amended to read:86.26    Subd. 11. Recapture tax. (a) If, within three years after the decedent's death and 86.27before the death of the qualified heir, the qualified heir disposes of any interest in the 86.28qualified property, other than by a disposition to a family member or qualifying entity, 86.29or a family member ceases to use the qualified property which was acquired or passed 86.30from the decedent satisfy the requirement under subdivision 9, clause (7); or 10, clause 86.31(5), an additional estate tax is imposed on the property. In the case of a sole proprietor, if 86.32the qualified heir replaces qualified small business property excluded under subdivision 9 86.33with similar property, then the qualified heir will not be treated as having disposed of an 86.34interest in the qualified property.87.1(b) The amount of the additional tax equals the amount of the exclusion claimed with 87.2respect to the qualified interest disposed of by the estate under subdivision 8, paragraph 87.3(d), multiplied by 16 percent.87.4(c) The additional tax under this subdivision is due on the day which is six months 87.5after the date of the disposition or cessation in paragraph (a).87.6(c) For purposes of paragraph (a), "qualifying entity" means a corporation or other 87.7entity that is owned by a family member or family members and, for qualified farm 87.8property, that is not excluded from owning agricultural land under section 500.24.87.9EFFECTIVE DATE.This section is effective for estates of decedents dying after 87.10June 30, 2011.87.11ARTICLE 687.12PUBLIC FINANCE87.13    Section 1. Minnesota Statutes 2010, section 373.40, subdivision 1, is amended to read:87.14    Subdivision 1. Definitions. For purposes of this section, the following terms have 87.15the meanings given.87.16(a) "Bonds" means an obligation as defined under section 
         475.51.87.17(b) "Capital improvement" means acquisition or betterment of public lands, 87.18buildings, or other improvements within the county for the purpose of a county courthouse, 87.19administrative building, health or social service facility, correctional facility, jail, law 87.20enforcement center, hospital, morgue, library, park, qualified indoor ice arena, roads 87.21and bridges, public works facilities, fairgrounds buildings, and records and data storage 87.22facilities, and the acquisition of development rights in the form of conservation easements 87.23under chapter 84C. An improvement must have an expected useful life of five years or 87.24more to qualify. "Capital improvement" does not include a recreation or sports facility 87.25building (such as, but not limited to, a gymnasium, ice arena, racquet sports facility, 87.26swimming pool, exercise room or health spa), unless the building is part of an outdoor 87.27park facility and is incidental to the primary purpose of outdoor recreation.87.28(c) "Metropolitan county" means a county located in the seven-county metropolitan 87.29area as defined in section 
         473.121 or a county with a population of 90,000 or more.87.30(d) "Population" means the population established by the most recent of the 87.31following (determined as of the date the resolution authorizing the bonds was adopted):87.32(1) the federal decennial census,87.33(2) a special census conducted under contract by the United States Bureau of the 87.34Census, or88.1(3) a population estimate made either by the Metropolitan Council or by the state 88.2demographer under section 
         4A.02.88.3(e) "Qualified indoor ice arena" means a facility that meets the requirements of 88.4section 
         373.43.88.5(f) "Tax capacity" means total taxable market value, but does not include captured 88.6market value.88.7    Sec. 2. Minnesota Statutes 2010, section 373.40, subdivision 2, is amended to read:88.8    Subd. 2. Application of election requirement. (a) Bonds issued by a county 88.9to finance capital improvements under an approved capital improvement plan are not 88.10subject to the election requirements of section 
         375.18 or 
         475.58. The bonds must be 88.11approved by vote of at least three-fifths of the members of the county board. In the case 88.12of a metropolitan county, the bonds must be approved by vote of at least two-thirds of 88.13the members of the county board.88.14(b) Before issuance of bonds qualifying under this section, the county must publish 88.15a notice of its intention to issue the bonds and the date and time of a hearing to obtain 88.16public comment on the matter. The notice must be published in the official newspaper 88.17of the county or in a newspaper of general circulation in the county. The notice must be 88.18published at least 14, but not more than 28, days before the date of the hearing.88.19(c) A county may issue the bonds only upon obtaining the approval of a majority of 88.20the voters voting on the question of issuing the obligations, if a petition requesting a vote 88.21on the issuance is signed by voters equal to five percent of the votes cast in the county in 88.22the last county general election and is filed with the county auditor within 30 days after 88.23the public hearing. The commissioner of revenue shall prepare a suggested form of the 88.24question to be presented at the election If the county elects not to submit the question to 88.25the voters, the county shall not propose the issuance of bonds under this section for the 88.26same purpose and in the same amount for a period of 365 days from the date of receipt 88.27of the petition. If the question of issuing the bonds is submitted and not approved by the 88.28voters, the provisions of section 475.58, subdivision 1a, apply.88.29    Sec. 3. Minnesota Statutes 2010, section 373.40, subdivision 4, is amended to read:88.30    Subd. 4. Limitations on amount. A county may not issue bonds under this section 88.31if the maximum amount of principal and interest to become due in any year on all the 88.32outstanding bonds issued pursuant to this section (including the bonds to be issued) will 88.33equal or exceed 0.12 percent of taxable market value of property in the county. Calculation 88.34of the limit must be made using the taxable market value for the taxes payable year in 89.1which the obligations are issued and sold, provided that, for purposes of determining 89.2the principal and interest due in any year, the county may deduct the amount of interest 89.3expected to be paid or reimbursed to the county by the federal government in that year on 89.4any outstanding bonds or the bonds to be issued. This section does not limit the authority 89.5to issue bonds under any other special or general law.89.6    Sec. 4. Minnesota Statutes 2010, section 474A.02, subdivision 23a, is amended to read:89.7    Subd. 23a. Qualified bonds. "Qualified bonds" means the specific type or types 89.8of obligations that are subject to the annual volume cap. Qualified bonds include the 89.9following types of obligations as defined in federal tax law:89.10(a) "public facility bonds" means "exempt facility bonds" as defined in federal 89.11tax law, except for residential rental project bonds, which are those obligations issued 89.12to finance airports, docks and wharves, mass commuting facilities, facilities for the 89.13furnishing of water, sewage facilities, solid waste disposal facilities, facilities for the 89.14local furnishing of electric energy or gas, local district heating or cooling facilities, and 89.15qualified hazardous waste facilities. New bonds and other obligations are ineligible to 89.16receive state allocations or entitlement authority for public facility projects under this 89.17section if they have been issued:89.18(1) for the purpose of refinancing, refunding, or otherwise defeasing existing debt; 89.19and89.20(2) more than one calendar year prior to the date of application;89.21(b) "residential rental project bonds" which are those obligations issued to finance 89.22qualified residential rental projects;89.23(c) "mortgage bonds";89.24(d) "small issue bonds" issued to finance manufacturing projects and the acquisition 89.25or improvement of agricultural real or personal property under sections 
         41C.01 to 
         41C.13;89.26(e) "student loan bonds" issued by or on behalf of the Minnesota Office of Higher 89.27Education;89.28(f) "redevelopment bonds";89.29(g) "governmental bonds" with a nonqualified amount in excess of $15,000,000 as 89.30set forth in section 141(b)5 of federal tax law; and89.31(h) "enterprise zone facility bonds" issued to finance facilities located within 89.32empowerment zones or enterprise communities, as authorized under Public Law 103-66, 89.33section 13301 section 1394 of the Internal Revenue Code.89.34    Sec. 5. Minnesota Statutes 2010, section 475.521, subdivision 2, is amended to read:90.1    Subd. 2. Election requirement. (a) Bonds issued by a municipality to finance 90.2capital improvements under an approved capital improvements plan are not subject to the 90.3election requirements of section 
         475.58. The bonds must be approved by an affirmative 90.4vote of three-fifths of the members of a five-member governing body. In the case of a 90.5governing body having more or less than five members, the bonds must be approved by a 90.6vote of at least two-thirds of the members of the governing body.90.7(b) Before the issuance of bonds qualifying under this section, the municipality 90.8must publish a notice of its intention to issue the bonds and the date and time of the 90.9hearing to obtain public comment on the matter. The notice must be published in the 90.10official newspaper of the municipality or in a newspaper of general circulation in the 90.11municipality. Additionally, the notice may be posted on the official Web site, if any, of the 90.12municipality. The notice must be published at least 14 but not more than 28 days before 90.13the date of the hearing.90.14(c) A municipality may issue the bonds only after obtaining the approval of a 90.15majority of the voters voting on the question of issuing the obligations, if a petition 90.16requesting a vote on the issuance is signed by voters equal to five percent of the votes cast 90.17in the municipality in the last municipal general election and is filed with the clerk within 90.1830 days after the public hearing. The commissioner of revenue shall prepare a suggested 90.19form of the question to be presented at the election If the municipality elects not to submit 90.20the question to the voters, the municipality shall not propose the issuance of bonds under 90.21this section for the same purpose and in the same amount for a period of 365 days from the 90.22date of receipt of the petition. If the question of issuing the bonds is submitted and not 90.23approved by the voters, the provisions of section 475.58, subdivision 1a, apply.90.24    Sec. 6. Minnesota Statutes 2010, section 475.521, subdivision 4, is amended to read:90.25    Subd. 4. Limitations on amount. A municipality may not issue bonds under 90.26this section if the maximum amount of principal and interest to become due in any 90.27year on all the outstanding bonds issued under this section, including the bonds to be 90.28issued, will equal or exceed 0.16 percent of the taxable market value of property in the 90.29municipality. Calculation of the limit must be made using the taxable market value for 90.30the taxes payable year in which the obligations are issued and sold, provided that, for 90.31purposes of determining the principal and interest due in any year, the municipality may 90.32deduct the amount of interest expected to be paid or reimbursed to the municipality by the 90.33federal government in that year on any outstanding bonds or the bonds to be issued. In 90.34the case of a municipality with a population of 2,500 or more, the bonds are subject to 90.35the net debt limits under section 
         475.53. In the case of a shared facility in which more 91.1than one municipality participates, upon compliance by each participating municipality 91.2with the requirements of subdivision 2, the limitations in this subdivision and the net debt 91.3represented by the bonds shall be allocated to each participating municipality in proportion 91.4to its required financial contribution to the financing of the shared facility, as set forth in 91.5the joint powers agreement relating to the shared facility. This section does not limit the 91.6authority to issue bonds under any other special or general law.91.7    Sec. 7. Minnesota Statutes 2010, section 475.58, subdivision 3b, is amended to read:91.8    Subd. 3b. Street reconstruction. (a) A municipality may, without regard to 91.9the election requirement under subdivision 1, issue and sell obligations for street 91.10reconstruction, if the following conditions are met:91.11    (1) the streets are reconstructed under a street reconstruction plan that describes the 91.12street reconstruction to be financed, the estimated costs, and any planned reconstruction 91.13of other streets in the municipality over the next five years, and the plan and issuance of 91.14the obligations has been approved by a vote of all of the members of the governing body 91.15present at the meeting following a public hearing for which notice has been published in 91.16the official newspaper at least ten days but not more than 28 days prior to the hearing; and91.17    (2) if a petition requesting a vote on the issuance is signed by voters equal to 91.18five percent of the votes cast in the last municipal general election and is filed with the 91.19municipal clerk within 30 days of the public hearing, the municipality may issue the bonds 91.20only after obtaining the approval of a majority of the voters voting on the question of the 91.21issuance of the obligations. If the municipality elects not to submit the question to the 91.22voters, the municipality shall not propose the issuance of bonds under this section for the 91.23same purpose and in the same amount for a period of 365 days from the date of receipt 91.24of the petition. If the question of issuing the bonds is submitted and not approved by the 91.25voters, the provisions of subdivision 1a, apply.91.26    (b) Obligations issued under this subdivision are subject to the debt limit of the 91.27municipality and are not excluded from net debt under section 
         475.51, subdivision 4.91.28    (c) For purposes of this subdivision, street reconstruction includes utility 91.29replacement and relocation and other activities incidental to the street reconstruction, turn 91.30lanes and other improvements having a substantial public safety function, realignments, 91.31other modifications to intersect with state and county roads, and the local share of state 91.32and county road projects.91.33    (d) Except in the case of turn lanes, safety improvements, realignments, intersection 91.34modifications, and the local share of state and county road projects, street reconstruction 92.1does not include the portion of project cost allocable to widening a street or adding curbs 92.2and gutters where none previously existed.92.3    Sec. 8. Laws 1971, chapter 773, section 1, subdivision 2, as amended by Laws 1974, 92.4chapter 351, section 5, Laws 1976, chapter 234, sections 1 and 7, Laws 1978, chapter 788, 92.5section 1, Laws 1981, chapter 369, section 1, Laws 1983, chapter 302, section 1, Laws 92.61988, chapter 513, section 1, Laws 1992, chapter 511, article 9, section 23, Laws 1998, 92.7chapter 389, article 3, section 27, and Laws 2002, chapter 390, section 23, is amended to 92.8read:92.9    Subd. 2. For each of the years 2003 to 2013 2012 to 2024, the city of St. Paul is 92.10authorized to issue bonds in the aggregate principal amount of $20,000,000 for each year.92.11EFFECTIVE DATE.This section is effective the day following final enactment.92.12    Sec. 9. Laws 2003, chapter 127, article 12, section 28, is amended to read:92.13    Sec. 28. NURSING HOME BONDS AUTHORIZED.92.14    (a) Itasca County may issue bonds under Minnesota Statutes, sections 
         376.55 and 92.15376.56
         , to finance the construction of a 35-bed nursing home facility to replace an existing 92.1635-bed private facility located in the county. The bonds issued under this section must92.17may be payable solely from revenues and or may not be general obligations of the county.92.18    (b) Before issuing general obligation bonds under this section, the county must 92.19publish a notice of its intention to issue the bonds and the date and time of a hearing to 92.20obtain public comment on the matter. The notice must be published on the official Web 92.21site of the county or in a newspaper of general circulation in the county. The notice must 92.22be published at least 14, but not more than 28, days before the date of the hearing.  The 92.23county may issue the bonds only upon obtaining the approval of a majority of the voters 92.24voting on the question of issuing the obligations, if a petition requesting a vote on the 92.25issuance is signed by voters equal to five percent of the votes cast in the county in the last 92.26general election and is filed with the county auditor within 30 days after the public hearing.92.27EFFECTIVE DATE; LOCAL APPROVAL.This section is effective the day after 92.28the governing body of Itasca County and its chief clerical officer timely complete their 92.29compliance with Minnesota Statutes, section 645.021, subdivisions 2 and 3.92.30    Sec. 10. WOODBURY; EXEMPTION FROM REFERENDUM.92.31    (a) Notwithstanding the referendum requirement in Minnesota Statutes, section 92.32475.58, subdivision 1, or any other provision of law, the city of Woodbury may issue and 93.1sell obligations to pay for the cost of renovating, improving, expanding, and equipping the 93.2Bielenberg Sports Center, along with costs of issuance of the obligations and capitalized 93.3interest, if:93.4    (1) the obligations are secured by a pledge of revenues from the facility; and93.5    (2) the city finds, based on analysis provided by a professional experienced in 93.6finance, that the facility's revenues and a property tax levy equal to the maximum annual 93.7property tax levy used to pay the bonds previously issued to finance, in whole or in part, 93.8the facility will in the aggregate be sufficient to pay the obligations without the imposition 93.9of an additional property tax levy pledged to the obligations.93.10    (b) Before issuing bonds under this section, the city must publish a notice of its 93.11intention to issue the bonds and the date and time of a hearing to obtain public comment 93.12on the matter. The notice must be published on the official Web site of the city or in a 93.13newspaper of general circulation in the city. The notice must be published at least 14, but 93.14not more than 28, days before the date of the hearing. The city may issue the bonds only 93.15upon obtaining the approval of a majority of the voters voting on the question of issuing 93.16the obligations, if a petition requesting a vote on the issuance is signed by voters equal to 93.17five percent of the votes cast in the city in the last general election and is filed with the city 93.18clerk within 30 days after the public hearing.93.19EFFECTIVE DATE; LOCAL APPROVAL.This section  is effective the day after 93.20the governing body of the city of Woodbury and its chief clerical officer timely complete 93.21their compliance with Minnesota Statutes, section 645.021, subdivisions 2 and 3.93.22ARTICLE 793.23HOMESTEAD MARKET VALUE CLEANUP93.24    Section 1. Minnesota Statutes 2010, section 38.18, is amended to read:93.2538.18 COUNTY FAIRGROUNDS; IMPROVEMENT AIDED.93.26Any Each town, statutory city, or school district in this state, now or hereafter at 93.27any time having a an estimated market value of all its taxable property, exclusive of 93.28money and credits, of more than $105,000,000, and having a county fair located within its 93.29corporate limits, is hereby authorized to aid in defraying may pay part of the expense of 93.30improving any such the fairground, by appropriating and paying over to the treasurer of 93.31the county owning the fairground such sum of money, not exceeding $10,000, for each 93.32of the political subdivisions, as the its governing body of the town, statutory city, or 93.33school district may, by resolution, determine determines to be for the best interest of the 93.34political subdivision,. The sums so appropriated to amounts paid to the county must be 93.35used solely for the purpose of aiding in the improvement of to improve the fairground 94.1in such the manner as the county board of the county shall determine determines to be 94.2for the best interest of the county.94.3    Sec. 2. Minnesota Statutes 2010, section 40A.15, subdivision 2, is amended to read:94.4    Subd. 2. Eligible recipients. All counties within the state, municipalities that 94.5prepare plans and official controls instead of a county, and districts are eligible for 94.6assistance under the program. Counties and districts may apply for assistance on behalf 94.7of other municipalities. In order to be eligible for financial assistance a county or 94.8municipality must agree to levy at least 0.01209 percent of taxable estimated market 94.9value for agricultural land preservation and conservation activities or otherwise spend the 94.10equivalent amount of local money on those activities, or spend $15,000 of local money, 94.11whichever is less.94.12    Sec. 3. Minnesota Statutes 2010, section 69.011, subdivision 1, is amended to read:94.13    Subdivision 1. Definitions. Unless the language or context clearly indicates that 94.14a different meaning is intended, the following words and terms, for the purposes of this 94.15chapter and chapters 423, 423A, 424 and 424A, have the meanings ascribed to them:94.16    (a) "Commissioner" means the commissioner of revenue.94.17    (b) "Municipality" means:94.18    (1) a home rule charter or statutory city;94.19    (2) an organized town;94.20    (3) a park district subject to chapter 398;94.21    (4) the University of Minnesota;94.22    (5) for purposes of the fire state aid program only, an American Indian tribal 94.23government entity located within a federally recognized American Indian reservation;94.24    (6) for purposes of the police state aid program only, an American Indian tribal 94.25government with a tribal police department which exercises state arrest powers under 94.26section 
         626.90, 
         626.91, 
         626.92, or 
         626.93;94.27    (7) for purposes of the police state aid program only, the Metropolitan Airports 94.28Commission; and94.29    (8) for purposes of the police state aid program only, the Department of Natural 94.30Resources and the Department of Public Safety with respect to peace officers covered 94.31under chapter 352B.94.32    (c) "Minnesota Firetown Premium Report" means a form prescribed by the 94.33commissioner containing space for reporting by insurers of fire, lightning, sprinkler 95.1leakage and extended coverage premiums received upon risks located or to be performed 95.2in this state less return premiums and dividends.95.3    (d) "Firetown" means the area serviced by any municipality having a qualified fire 95.4department or a qualified incorporated fire department having a subsidiary volunteer 95.5firefighters' relief association.95.6    (e) "Estimated market value" means latest available estimated market value of all 95.7property in a taxing jurisdiction, whether the property is subject to taxation, or exempt 95.8from ad valorem taxation obtained from information which appears on abstracts filed with 95.9the commissioner of revenue or equalized by the State Board of Equalization.95.10    (f) "Minnesota Aid to Police Premium Report" means a form prescribed by the 95.11commissioner for reporting by each fire and casualty insurer of all premiums received 95.12upon direct business received by it in this state, or by its agents for it, in cash or otherwise, 95.13during the preceding calendar year, with reference to insurance written for insuring against 95.14the perils contained in auto insurance coverages as reported in the Minnesota business 95.15schedule of the annual financial statement which each insurer is required to file with 95.16the commissioner in accordance with the governing laws or rules less return premiums 95.17and dividends.95.18    (g) "Peace officer" means any person:95.19    (1) whose primary source of income derived from wages is from direct employment 95.20by a municipality or county as a law enforcement officer on a full-time basis of not less 95.21than 30 hours per week;95.22    (2) who has been employed for a minimum of six months prior to December 31 95.23preceding the date of the current year's certification under subdivision 2, clause (b);95.24    (3) who is sworn to enforce the general criminal laws of the state and local 95.25ordinances;95.26    (4) who is licensed by the Peace Officers Standards and Training Board and is 95.27authorized to arrest with a warrant; and95.28    (5) who is a member of the Minneapolis Police Relief Association, the State Patrol 95.29retirement plan, or the public employees police and fire fund.95.30    (h) "Full-time equivalent number of peace officers providing contract service" means 95.31the integral or fractional number of peace officers which would be necessary to provide 95.32the contract service if all peace officers providing service were employed on a full-time 95.33basis as defined by the employing unit and the municipality receiving the contract service.95.34    (i) "Retirement benefits other than a service pension" means any disbursement 95.35authorized under section 
         424A.05, subdivision 3, clauses (3) and (4).96.1    (j) "Municipal clerk, municipal clerk-treasurer, or county auditor" means the person 96.2who was elected or appointed to the specified position or, in the absence of the person, 96.3another person who is designated by the applicable governing body. In a park district, 96.4the clerk is the secretary of the board of park district commissioners. In the case of the 96.5University of Minnesota, the clerk is that official designated by the Board of Regents. 96.6For the Metropolitan Airports Commission, the clerk is the person designated by the 96.7commission. For the Department of Natural Resources or the Department of Public Safety, 96.8the clerk is the respective commissioner. For a tribal police department which exercises 96.9state arrest powers under section 
         626.90, 
         626.91, 
         626.92, or 
         626.93, the clerk is the person 96.10designated by the applicable American Indian tribal government.96.11(k) "Voluntary statewide lump-sum volunteer firefighter retirement plan" means the 96.12retirement plan established by chapter 353G.96.13    Sec. 4. Minnesota Statutes 2010, section 69.021, subdivision 7, is amended to read:96.14    Subd. 7. Apportionment of fire state aid to municipalities and relief associations.96.15(a) The commissioner shall apportion the fire state aid relative to the premiums reported 96.16on the Minnesota Firetown Premium Reports filed under this chapter to each municipality 96.17and/or firefighters relief association.96.18(b) The commissioner shall calculate an initial fire state aid allocation amount for 96.19each municipality or fire department under paragraph (c) and a minimum fire state aid 96.20allocation amount for each municipality or fire department under paragraph (d). The 96.21municipality or fire department must receive the larger fire state aid amount.96.22(c) The initial fire state aid allocation amount is the amount available for 96.23apportionment as fire state aid under subdivision 5, without inclusion of any additional 96.24funding amount to support a minimum fire state aid amount under section 
         423A.02, 96.25subdivision 3
         , allocated one-half in proportion to the population as shown in the last 96.26official statewide federal census for each fire town and one-half in proportion to the 96.27estimated market value of each fire town, including (1) the estimated market value of 96.28tax-exempt property and (2) the estimated market value of natural resources lands 96.29receiving in lieu payments under sections 
         477A.11 to 
         477A.14, but excluding the 96.30estimated market value of minerals. In the case of incorporated or municipal fire 96.31departments furnishing fire protection to other cities, towns, or townships as evidenced 96.32by valid fire service contracts filed with the commissioner, the distribution must be 96.33adjusted proportionately to take into consideration the crossover fire protection service. 96.34Necessary adjustments must be made to subsequent apportionments. In the case of 96.35municipalities or independent fire departments qualifying for the aid, the commissioner 97.1shall calculate the state aid for the municipality or relief association on the basis of the 97.2population and the estimated market value of the area furnished fire protection service 97.3by the fire department as evidenced by duly executed and valid fire service agreements 97.4filed with the commissioner. If one or more fire departments are furnishing contracted fire 97.5service to a city, town, or township, only the population and estimated market value of the 97.6area served by each fire department may be considered in calculating the state aid and 97.7the fire departments furnishing service shall enter into an agreement apportioning among 97.8themselves the percent of the population and the estimated market value of each service 97.9area. The agreement must be in writing and must be filed with the commissioner.97.10(d) The minimum fire state aid allocation amount is the amount in addition to the 97.11initial fire state allocation amount that is derived from any additional funding amount 97.12to support a minimum fire state aid amount under section 
         423A.02, subdivision 3, and 97.13allocated to municipalities with volunteer firefighters relief associations or covered by the 97.14voluntary statewide lump-sum volunteer firefighter retirement plan based on the number 97.15of active volunteer firefighters who are members of the relief association as reported 97.16in the annual financial reporting for the calendar year 1993 to the Office of the State 97.17Auditor, but not to exceed 30 active volunteer firefighters, so that all municipalities or 97.18fire departments with volunteer firefighters relief associations receive in total at least a 97.19minimum fire state aid amount per 1993 active volunteer firefighter to a maximum of 97.2030 firefighters. If a relief association is established after calendar year 1993 and before 97.21calendar year 2000, the number of active volunteer firefighters who are members of the 97.22relief association as reported in the annual financial reporting for calendar year 1998 97.23to the Office of the State Auditor, but not to exceed 30 active volunteer firefighters, 97.24shall be used in this determination. If a relief association is established after calendar 97.25year 1999, the number of active volunteer firefighters who are members of the relief 97.26association as reported in the first annual financial reporting submitted to the Office of 97.27the State Auditor, but not to exceed 20 active volunteer firefighters, must be used in this 97.28determination. If a relief association is terminated as a result of providing retirement 97.29coverage for volunteer firefighters by the voluntary statewide lump-sum volunteer 97.30firefighter retirement plan under chapter 353G, the number of active volunteer firefighters 97.31of the municipality covered by the statewide plan as certified by the executive director of 97.32the Public Employees Retirement Association to the commissioner and the state auditor, 97.33but not to exceed 30 active firefighters, must be used in this determination.97.34(e) Unless the firefighters of the applicable fire department are members of the 97.35voluntary statewide lump-sum volunteer firefighter retirement plan, the fire state aid must 97.36be paid to the treasurer of the municipality where the fire department is located and the 98.1treasurer of the municipality shall, within 30 days of receipt of the fire state aid, transmit 98.2the aid to the relief association if the relief association has filed a financial report with the 98.3treasurer of the municipality and has met all other statutory provisions pertaining to the 98.4aid apportionment. If the firefighters of the applicable fire department are members of 98.5the voluntary statewide lump-sum volunteer firefighter retirement plan, the fire state aid 98.6must be paid to the executive director of the Public Employees Retirement Association 98.7and deposited in the voluntary statewide lump-sum volunteer firefighter retirement fund.98.8(f) The commissioner may make rules to permit the administration of the provisions 98.9of this section.98.10(g) Any adjustments needed to correct prior misallocations must be made to 98.11subsequent apportionments.98.12    Sec. 5. Minnesota Statutes 2010, section 69.021, subdivision 8, is amended to read:98.13    Subd. 8. Population and estimated market value. (a) In computations relating to 98.14fire state aid requiring the use of population figures, only official statewide federal census 98.15figures are to be used. Increases or decreases in population disclosed by reason of any 98.16special census must not be taken into consideration.98.17(b) In calculations relating to fire state aid requiring the use of estimated market 98.18value property figures, only the latest available estimated market value property figures 98.19may be used.98.20    Sec. 6. Minnesota Statutes 2010, section 88.51, subdivision 3, is amended to read:98.21    Subd. 3. Determination of market value. In determining the net tax capacity of 98.22property within any taxing district the value of the surface of lands within any auxiliary 98.23forest therein, as determined by the county board under the provisions of section 
         88.48, 98.24subdivision 3
         , shall, for all purposes except the levying of taxes on lands within any such 98.25forest, be deemed the estimated market value thereof.98.26    Sec. 7. Minnesota Statutes 2010, section 103B.245, subdivision 3, is amended to read:98.27    Subd. 3. Tax. After adoption of the ordinance under subdivision 2, a local 98.28government unit may annually levy a tax on all taxable property in the district for the 98.29purposes for which the tax district is established. The tax may not exceed 0.02418 percent 98.30of estimated market value on taxable property located in rural towns other than urban 98.31towns, unless allowed by resolution of the town electors. The proceeds of the tax shall 98.32be paid into a fund reserved for these purposes. Any proceeds remaining in the reserve 98.33fund at the time the tax is terminated or the district is dissolved shall be transferred and 99.1irrevocably pledged to the debt service fund of the local unit to be used solely to reduce 99.2tax levies for bonded indebtedness of taxable property in the district.99.3    Sec. 8. Minnesota Statutes 2010, section 103B.251, subdivision 8, is amended to read:99.4    Subd. 8. Tax. (a) For the payment of principal and interest on the bonds issued 99.5under subdivision 7 and the payment required under subdivision 6, the county shall 99.6irrevocably pledge and appropriate the proceeds of a tax levied on all taxable property 99.7located within the territory of the watershed management organization or subwatershed 99.8unit for which the bonds are issued. Each year until the reserve for payment of the bonds 99.9is sufficient to retire the bonds, the county shall levy on all taxable property in the territory 99.10of the organization or unit, without respect to any statutory or other limitation on taxes, an 99.11amount of taxes sufficient to pay principal and interest on the bonds and to restore any 99.12deficiencies in reserves required to be maintained for payment of the bonds.99.13(b) The tax levied on rural towns other than urban towns may not exceed 0.02418 99.14percent of taxable estimated market value, unless approved by resolution of the town 99.15electors.99.16(c) If at any time the amounts available from the levy on property in the territory of 99.17the organization are insufficient to pay principal and interest on the bonds when due, the 99.18county shall make payment from any available funds in the county treasury.99.19(d) The amount of any taxes which are required to be levied outside of the territory 99.20of the watershed management organization or unit or taken from the general funds of the 99.21county to pay principal or interest on the bonds shall be reimbursed to the county from 99.22taxes levied within the territory of the watershed management organization or unit.99.23    Sec. 9. Minnesota Statutes 2010, section 103B.635, subdivision 2, is amended to read:99.24    Subd. 2. Municipal funding of district. (a) The governing body or board of 99.25supervisors of each municipality in the district must provide the funds necessary to meet 99.26its proportion of the total cost determined by the board, provided the total funding from 99.27all municipalities in the district for the costs shall not exceed an amount equal to .00242 99.28percent of the total taxable estimated market value within the district, unless three-fourths 99.29of the municipalities in the district pass a resolution concurring to the additional costs.99.30(b) The funds must be deposited in the treasury of the district in amounts and at 99.31times as the treasurer of the district requires.99.32    Sec. 10. Minnesota Statutes 2010, section 103B.691, subdivision 2, is amended to read:100.1    Subd. 2. Municipal funding of district. (a) The governing body or board of 100.2supervisors of each municipality in the district shall provide the funds necessary to 100.3meet its proportion of the total cost to be borne by the municipalities as finally certified 100.4by the board.100.5(b) The municipality's funds may be raised by any means within the authority of 100.6the municipality. The municipalities may each levy a tax not to exceed .02418 percent of 100.7taxable estimated market value on the taxable property located in the district to provide 100.8the funds. The levy shall be within all other limitations provided by law.100.9(c) The funds must be deposited into the treasury of the district in amounts and at 100.10times as the treasurer of the district requires.100.11    Sec. 11. Minnesota Statutes 2010, section 103D.905, subdivision 2, is amended to read:100.12    Subd. 2. Organizational expense fund. (a) An organizational expense fund, 100.13consisting of an ad valorem tax levy, shall not exceed 0.01596 percent of taxableestimated 100.14market value, or $60,000, whichever is less. The money in the fund shall be used for 100.15organizational expenses and preparation of the watershed management plan for projects.100.16(b) The managers may borrow from the affected counties up to 75 percent of the 100.17anticipated funds to be collected from the organizational expense fund levy and the 100.18counties affected may make the advancements.100.19(c) The advancement of anticipated funds shall be apportioned among affected 100.20counties in the same ratio as the net tax capacity of the area of the counties within 100.21the watershed district bears to the net tax capacity of the entire watershed district. If a 100.22watershed district is enlarged, an organizational expense fund may be levied against the 100.23area added to the watershed district in the same manner as provided in this subdivision.100.24(d) Unexpended funds collected for the organizational expense may be transferred to 100.25the administrative fund and used for the purposes of the administrative fund.100.26    Sec. 12. Minnesota Statutes 2010, section 103D.905, subdivision 3, is amended to read:100.27    Subd. 3. General fund. A general fund, consisting of an ad valorem tax levy, may 100.28not exceed 0.048 percent of taxable estimated market value, or $250,000, whichever is 100.29less. The money in the fund shall be used for general administrative expenses and for 100.30the construction or implementation and maintenance of projects of common benefit to 100.31the watershed district. The managers may make an annual levy for the general fund as 100.32provided in section 
         103D.911. In addition to the annual general levy, the managers may 100.33annually levy a tax not to exceed 0.00798 percent of taxable estimated market value 100.34for a period not to exceed 15 consecutive years to pay the cost attributable to the basic 101.1water management features of projects initiated by petition of a political subdivision 101.2within the watershed district or by petition of at least 50 resident owners whose property 101.3is within the watershed district.101.4    Sec. 13. Minnesota Statutes 2010, section 103D.905, subdivision 8, is amended to read:101.5    Subd. 8. Survey and data acquisition fund. (a) A survey and data acquisition fund 101.6is established and used only if other funds are not available to the watershed district to pay 101.7for making necessary surveys and acquiring data.101.8(b) The survey and data acquisition fund consists of the proceeds of a property tax 101.9that can be levied only once every five years. The levy may not exceed 0.02418 percent of 101.10taxable estimated market value.101.11(c) The balance of the survey and data acquisition fund may not exceed $50,000.101.12(d) In a subsequent proceeding for a project where a survey has been made, the 101.13attributable cost of the survey as determined by the managers shall be included as a part of 101.14the cost of the work and the sum shall be repaid to the survey and data acquisition fund.101.15    Sec. 14. Minnesota Statutes 2010, section 117.025, subdivision 7, is amended to read:101.16    Subd. 7. Structurally substandard. "Structurally substandard" means a building:101.17(1) that was inspected by the appropriate local government and cited for one or more 101.18enforceable housing, maintenance, or building code violations;101.19(2) in which the cited building code violations involve one or more of the following:101.20(i) a roof and roof framing element;101.21(ii) support walls, beams, and headers;101.22(iii) foundation, footings, and subgrade conditions;101.23(iv) light and ventilation;101.24(v) fire protection, including egress;101.25(vi) internal utilities, including electricity, gas, and water;101.26(vii) flooring and flooring elements; or101.27(viii) walls, insulation, and exterior envelope;101.28(3) in which the cited housing, maintenance, or building code violations have not 101.29been remedied after two notices to cure the noncompliance; and101.30(4) has uncured housing, maintenance, and building code violations, satisfaction of 101.31which would cost more than 50 percent of the assessor's taxable estimated market value 101.32for the building, excluding land value, as determined under section 
         273.11 for property 101.33taxes payable in the year in which the condemnation is commenced.102.1A local government is authorized to seek from a judge or magistrate an administrative 102.2warrant to gain access to inspect a specific building in a proposed development or 102.3redevelopment area upon showing of probable cause that a specific code violation has 102.4occurred and that the violation has not been cured, and that the owner has denied the local 102.5government access to the property. Items of evidence that may support a conclusion of 102.6probable cause may include recent fire or police inspections, housing inspection, exterior 102.7evidence of deterioration, or other similar reliable evidence of deterioration in the specific 102.8building.102.9    Sec. 15. Minnesota Statutes 2010, section 127A.48, subdivision 1, is amended to read:102.10    Subdivision 1. Computation. The Department of Revenue must annually conduct 102.11an assessment/sales ratio study of the taxable property in each county, city, town, and 102.12school district in accordance with the procedures in subdivisions 2 and 3. Based upon the 102.13results of this assessment/sales ratio study, the Department of Revenue must determine an 102.14aggregate equalized net tax capacity for the various classes of taxable property in each 102.15taxing district, the aggregate of which tax capacity shall beis designated as the adjusted 102.16net tax capacity. The adjusted net tax capacity must be reduced by the captured tax 102.17capacity of tax increment districts under section 469.177, subdivision 2, fiscal disparities 102.18contribution tax capacities under sections 276A.06 and 473F.08, and the tax capacity of 102.19transmission lines required to be subtracted from the local tax base under section 273.425; 102.20and increased by fiscal disparities distribution tax capacities under sections 276A.06 and 102.21473F.08. The adjusted net tax capacities shall be determined using the net tax capacity 102.22percentages in effect for the assessment year following the assessment year of the study. 102.23The Department of Revenue must make whatever estimates are necessary to account for 102.24changes in the classification system. The Department of Revenue may incur the expense 102.25necessary to make the determinations. The commissioner of revenue may reimburse any 102.26county or governmental official for requested services performed in ascertaining the 102.27adjusted net tax capacity. On or before March 15 annually, the Department of Revenue 102.28shall file with the chair of the Tax Committee of the house of representatives and the 102.29chair of the Committee on Taxes and Tax laws of the senate a report of adjusted net tax 102.30capacities for school districts. On or before June 15 annually, the Department of Revenue 102.31shall file its final report on the adjusted net tax capacities for school districts established 102.32by the previous year's assessments and the current year's net tax capacity percentages with 102.33the commissioner of education and each county auditor for those school districts for 102.34which the auditor has the responsibility for determination of local tax rates. A copy of 102.35the report so filed shall be mailed to the clerk of each school district involved and to the 103.1county assessor or supervisor of assessments of the county or counties in which each 103.2school district is located.103.3EFFECTIVE DATE.This section is effective the day following final enactment.103.4    Sec. 16. Minnesota Statutes 2010, section 138.053, is amended to read:103.5138.053 COUNTY HISTORICAL SOCIETY; TAX LEVY; CITIES OR 103.6TOWNS.103.7The governing body of any home rule charter or statutory city or town may annually 103.8appropriate from its general fund an amount not to exceed 0.02418 percent of taxable103.9estimated market value, derived from ad valorem taxes on property or other revenues, 103.10to be paid to the historical society of its respective county to be used for the promotion 103.11of historical work and to aid in defraying the expenses of carrying on the historical 103.12work in the county. No city or town may appropriate any funds for the benefit of any 103.13historical society unless the society is affiliated with and approved by the Minnesota 103.14Historical Society.103.15    Sec. 17. Minnesota Statutes 2010, section 144F.01, subdivision 4, is amended to read:103.16    Subd. 4. Property tax levy authority. The district's board may levy a tax on the 103.17taxable real and personal property in the district. The ad valorem tax levy may not 103.18exceed 0.048 percent of the taxable estimated market value of the district or $400,000, 103.19whichever is less. The proceeds of the levy must be used as provided in subdivision 5. 103.20The board shall certify the levy at the times as provided under section 
         275.07. The board 103.21shall provide the county with whatever information is necessary to identify the property 103.22that is located within the district. If the boundaries include a part of a parcel, the entire 103.23parcel shall be included in the district. The county auditors must spread, collect, and 103.24distribute the proceeds of the tax at the same time and in the same manner as provided by 103.25law for all other property taxes.103.26    Sec. 18. Minnesota Statutes 2010, section 162.07, subdivision 3, is amended to read:103.27    Subd. 3. Computation for rural counties. An amount equal to a levy of 0.01596 103.28percent on each rural county's total taxable estimated market value for the last preceding 103.29calendar year shall be computed and shall be subtracted from the county's total estimated 103.30construction costs. The result thereof shall be the money needs of the county. For the 103.31purpose of this section, "rural counties" means all counties having a population of less 103.32than 175,000.104.1    Sec. 19. Minnesota Statutes 2010, section 162.07, subdivision 4, is amended to read:104.2    Subd. 4. Computation for urban counties. An amount equal to a levy of 0.00967 104.3percent on each urban county's total taxable estimated market value for the last preceding 104.4calendar year shall be computed and shall be subtracted from the county's total estimated 104.5construction costs. The result thereof shall be the money needs of the county. For 104.6the purpose of this section, "urban counties" means all counties having a population 104.7of 175,000 or more.104.8    Sec. 20. Minnesota Statutes 2010, section 163.04, subdivision 3, is amended to read:104.9    Subd. 3. Bridges within certain cities. When the council of any statutory city or 104.10city of the third or fourth class may determine that it is necessary to build or improve any 104.11bridge or bridges, including approaches thereto, and any dam or retaining works connected 104.12therewith, upon or forming a part of streets or highways either wholly or partly within 104.13its limits, the county board shall appropriate one-half of the money as may be necessary 104.14therefor from the county road and bridge fund, not exceeding during any year one-half 104.15the amount of taxes paid into the county road and bridge fund during the preceding year, 104.16on property within the corporate limits of the city. The appropriation shall be made upon 104.17the petition of the council, which petition shall be filed by the council with the county 104.18board prior to the fixing by the board of the annual county tax levy. The county board 104.19shall determine the plans and specifications, shall let all necessary contracts, shall have 104.20charge of construction, and upon its request, warrants in payment thereof shall be issued 104.21by the county auditor, from time to time, as the construction work proceeds. Any unpaid 104.22balance may be paid or advanced by the city. On petition of the council, the appropriations 104.23of the county board, during not to exceed three successive years, may be made to apply 104.24on the construction of the same items and to repay any money advanced by the city in 104.25the construction thereof. None of the provisions of this section shall be construed to 104.26be mandatory as applied to any city whose estimated market value exceeds $2,100 per 104.27capita of its population.104.28    Sec. 21. Minnesota Statutes 2010, section 163.06, subdivision 6, is amended to read:104.29    Subd. 6. Expenditure in certain counties. In any county having not less than 95 104.30nor more than 105 full and fractional townships, and having a an estimated market value 104.31of not less than $12,000,000 nor more than $21,000,000, exclusive of money and credits,104.32the county board, by resolution, may expend the funds provided in subdivision 4 in any 104.33organized or unorganized township or portion thereof in such county.105.1    Sec. 22. Minnesota Statutes 2010, section 165.10, subdivision 1, is amended to read:105.2    Subdivision 1. Certain counties may issue and sell. The county board of any 105.3county having no outstanding road and bridge bonds may issue and sell county road bonds 105.4in an amount not exceeding 0.12089 percent of the estimated market value of the taxable 105.5property within the county exclusive of money and credits, for the purpose of constructing, 105.6reconstructing, improving, or maintaining any bridge or bridges on any highway under its 105.7jurisdiction, without submitting the matter to a vote of the electors of the county.105.8    Sec. 23. Minnesota Statutes 2010, section 272.03, is amended by adding a subdivision 105.9to read:105.10    Subd. 14.Estimated market value."Estimated market value" means the assessor's 105.11determination of market value, including the effects of any orders made under section 105.12270.12 or chapter 274, for the parcel. The provisions of section 273.032 apply for certain 105.13uses in determining the total estimated market value for the taxing jurisdiction.105.14    Sec. 24. Minnesota Statutes 2010, section 272.03, is amended by adding a subdivision 105.15to read:105.16    Subd. 15.Taxable market value."Taxable market value" means estimated market 105.17value for the parcel as reduced by market value exclusions, deferments of value, or other 105.18adjustments, required by law, that reduce market value before the application of class rates.105.19    Sec. 25. Minnesota Statutes 2010, section 273.032, is amended to read:105.20273.032 MARKET VALUE DEFINITION.105.21(a) Unless otherwise provided, for the purpose of determining any property tax 105.22levy limitation based on market value or any limit on net debt, the issuance of bonds, 105.23certificates of indebtedness, or capital notes based on market value, any qualification to 105.24receive state aid based on market value, or any state aid amount based on market value, 105.25the terms "market value," "taxable estimated market value," and "market valuation," 105.26whether equalized or unequalized, mean the total taxable estimated market value of 105.27taxable property within the local unit of government before any of the following or 105.28similar adjustments for:105.29(1) the market value exclusions under:105.30(i) section 273.11, subdivisions 14a and 14c (vacant platted land);105.31(ii) section 273.11, subdivision 16 (certain improvements to homestead property);105.32(iii) section 273.11, subdivisions 19 and 20 (certain improvements to business 105.33properties);106.1(iv) section 273.11, subdivision 21 (homestead property damaged by mold);106.2(v) section 273.11, subdivision 22 (qualifying lead hazardous reduction projects);106.3(vi) section 273.13, subdivision 34 (homestead of a disabled veteran, spouse, or 106.4caregiver);106.5(vii) section 273.13, subdivision 35 (homestead market value exclusion); or106.6(2) the deferment of value under:106.7(i) the Minnesota Agricultural Property Tax Law, section 273.111;106.8(ii) the aggregate resource preservation law, section 273.1115;106.9(iii) the Minnesota Open Space Property Tax Law, section 273.112;106.10(iv) the rural preserves property tax program, section 273.114; or106.11(v) the Metropolitan Agricultural Preserves Act, section 473H.10; or106.12(3) the adjustments to tax capacity for:106.13(i) tax increment, financing under sections 469.174 to 469.1794;106.14(ii) fiscal disparity, disparities under chapter 276A or 473F; or106.15(iii) powerline credit, or wind energy values, but after the limited market adjustments 106.16under section 273.11, subdivision 1a, and after the market value exclusions of certain 106.17improvements to homestead property under section 273.11, subdivision 16 under section 106.18273.425.106.19(b) Estimated market value under paragraph (a) also includes the market value 106.20of tax exempt property if the applicable law specifically provides that the limitation, 106.21qualification, or aid calculation includes tax exempt property.106.22(c) Unless otherwise provided, "market value," "taxable estimated market value," 106.23and "market valuation" for purposes of this paragraph  property tax levy limitations and 106.24calculation of state aid, refer to the taxable estimated market value for the previous 106.25assessment year and for purposes of limits on net debt, the issuance of bonds, certificates of 106.26indebtedness, or capital notes refer to the estimated market value as last finally equalized.106.27For the purpose of determining any net debt limit based on market value, or any limit 106.28on the issuance of bonds, certificates of indebtedness, or capital notes based on market 106.29value, the terms "market value," "taxable market value," and "market valuation," whether 106.30equalized or unequalized, mean the total taxable market value of property within the local 106.31unit of government before any adjustments for tax increment, fiscal disparity, powerline 106.32credit, or wind energy values, but after the limited market value adjustments under section 106.33273.11, subdivision 1a, and after the market value exclusions of certain improvements to 106.34homestead property under section 273.11, subdivision 16. Unless otherwise provided, 106.35"market value," "taxable market value," and "market valuation" for purposes of this 106.36paragraph, mean the taxable market value as last finally equalized.107.1(d) For purposes of a provision of a home rule charter or of any special law that is 107.2not codified in the statutes and that imposes a levy limitation based on market value or 107.3any limit on debt, the issuance of bonds, certificates of indebtedness, or capital notes 107.4based on market value, the terms "market value," "taxable market value," and "market 107.5valuation," whether equalized or unequalized, mean "estimated market value" as defined 107.6in paragraph (a).107.7    Sec. 26. Minnesota Statutes 2010, section 273.11, subdivision 1, is amended to read:107.8    Subdivision 1. Generally. Except as provided in this section or section 
         273.17, 107.9subdivision 1
         , all property shall be valued at its market value. The market value as 107.10determined pursuant to this section shall be stated such that any amount under $100 is 107.11rounded up to $100 and any amount exceeding $100 shall be rounded to the nearest $100. 107.12In estimating and determining such value, the assessor shall not adopt a lower or different 107.13standard of value because the same is to serve as a basis of taxation, nor shall the assessor 107.14adopt as a criterion of value the price for which such property would sell at a forced sale, 107.15or in the aggregate with all the property in the town or district; but the assessor shall value 107.16each article or description of property by itself, and at such sum or price as the assessor 107.17believes the same to be fairly worth in money. The assessor shall take into account the 107.18effect on the market value of property of environmental factors in the vicinity of the 107.19property. In assessing any tract or lot of real property, the value of the land, exclusive of 107.20structures and improvements, shall be determined, and also the value of all structures and 107.21improvements thereon, and the aggregate value of the property, including all structures 107.22and improvements, excluding the value of crops growing upon cultivated land. In valuing 107.23real property upon which there is a mine or quarry, it shall be valued at such price as such 107.24property, including the mine or quarry, would sell for at a fair, voluntary sale, for cash, 107.25if the material being mined or quarried is not subject to taxation under section 
         298.015107.26and the mine or quarry is not exempt from the general property tax under section 
         298.25. 107.27In valuing real property which is vacant, platted property shall be assessed as provided 107.28in subdivision 14 subdivisions 14a and 14c. All property, or the use thereof, which is 107.29taxable under section 
         272.01, subdivision 2, or 
         273.19, shall be valued at the market 107.30value of such property and not at the value of a leasehold estate in such property, or at 107.31some lesser value than its market value.107.32    Sec. 27. Minnesota Statutes 2010, section 273.124, subdivision 3a, is amended to read:107.33    Subd. 3a. Manufactured home park cooperative. (a) When a manufactured home 107.34park is owned by a corporation or association organized under chapter 308A or 308B, 108.1and each person who owns a share or shares in the corporation or association is entitled 108.2to occupy a lot within the park, the corporation or association may claim homestead 108.3treatment for the park. Each lot must be designated by legal description or number, and 108.4each lot is limited to not more than one-half acre of land.108.5(b) The manufactured home park shall be entitled to homestead treatment if all 108.6of the following criteria are met:108.7(1) the occupant or the cooperative corporation or association is paying the ad 108.8valorem property taxes and any special assessments levied against the land and structure 108.9either directly, or indirectly through dues to the corporation or association; and108.10(2) the corporation or association organized under chapter 308A or 308B is wholly 108.11owned by persons having a right to occupy a lot owned by the corporation or association.108.12(c) A charitable corporation, organized under the laws of Minnesota with no 108.13outstanding stock, and granted a ruling by the Internal Revenue Service for 501(c)(3) 108.14tax-exempt status, qualifies for homestead treatment with respect to a manufactured home 108.15park if its members hold residential participation warrants entitling them to occupy a lot 108.16in the manufactured home park.108.17(d) "Homestead treatment" under this subdivision means the class rate provided for 108.18class 4c property classified under section 
         273.13, subdivision 25, paragraph (d), clause (5), 108.19item (ii). The homestead market value credit exclusion under section 
         273.1384 273.13, 108.20subdivision 35, does not apply and the property taxes assessed against the park shall not 108.21be included in the determination of taxes payable for rent paid under section 
         290A.03.108.22EFFECTIVE DATE.This section is effective for taxes payable in 2012 and 108.23thereafter.108.24    Sec. 28. Minnesota Statutes 2010, section 273.124, subdivision 13, is amended to read:108.25    Subd. 13. Homestead application. (a) A person who meets the homestead 108.26requirements under subdivision 1 must file a homestead application with the county 108.27assessor to initially obtain homestead classification.108.28    (b) The format and contents of a uniform homestead application shall be prescribed 108.29by the commissioner of revenue. The application must clearly inform the taxpayer that 108.30this application must be signed by all owners who occupy the property or by the qualifying 108.31relative and returned to the county assessor in order for the property to receive homestead 108.32treatment.108.33    (c) Every property owner applying for homestead classification must furnish to the 108.34county assessor the Social Security number of each occupant who is listed as an owner 108.35of the property on the deed of record, the name and address of each owner who does not 109.1occupy the property, and the name and Social Security number of each owner's spouse who 109.2occupies the property. The application must be signed by each owner who occupies the 109.3property and by each owner's spouse who occupies the property, or, in the case of property 109.4that qualifies as a homestead under subdivision 1, paragraph (c), by the qualifying relative.109.5    If a property owner occupies a homestead, the property owner's spouse may not 109.6claim another property as a homestead unless the property owner and the property owner's 109.7spouse file with the assessor an affidavit or other proof required by the assessor stating that 109.8the property qualifies as a homestead under subdivision 1, paragraph (e).109.9    Owners or spouses occupying residences owned by their spouses and previously 109.10occupied with the other spouse, either of whom fail to include the other spouse's name 109.11and Social Security number on the homestead application or provide the affidavits or 109.12other proof requested, will be deemed to have elected to receive only partial homestead 109.13treatment of their residence. The remainder of the residence will be classified as 109.14nonhomestead residential. When an owner or spouse's name and Social Security number 109.15appear on homestead applications for two separate residences and only one application is 109.16signed, the owner or spouse will be deemed to have elected to homestead the residence for 109.17which the application was signed.109.18    The Social Security numbers, state or federal tax returns or tax return information, 109.19including the federal income tax schedule F required by this section, or affidavits or other 109.20proofs of the property owners and spouses submitted under this or another section to 109.21support a claim for a property tax homestead classification are private data on individuals 109.22as defined by section 
         13.02, subdivision 12, but, notwithstanding that section, the private 109.23data may be disclosed to the commissioner of revenue, or, for purposes of proceeding 109.24under the Revenue Recapture Act to recover personal property taxes owing, to the county 109.25treasurer.109.26    (d) If residential real estate is occupied and used for purposes of a homestead by a 109.27relative of the owner and qualifies for a homestead under subdivision 1, paragraph (c), in 109.28order for the property to receive homestead status, a homestead application must be filed 109.29with the assessor. The Social Security number of each relative and spouse of a relative 109.30occupying the property shall be required on the homestead application filed under this 109.31subdivision. If a different relative of the owner subsequently occupies the property, the 109.32owner of the property must notify the assessor within 30 days of the change in occupancy. 109.33The Social Security number of a relative or relative's spouse occupying the property 109.34is private data on individuals as defined by section 
         13.02, subdivision 12, but may be 109.35disclosed to the commissioner of revenue, or, for the purposes of proceeding under the 109.36Revenue Recapture Act to recover personal property taxes owing, to the county treasurer.110.1    (e) The homestead application shall also notify the property owners that the 110.2application filed under this section will not be mailed annually and that if the property 110.3is granted homestead status for any assessment year, that same property shall remain 110.4classified as homestead until the property is sold or transferred to another person, or 110.5the owners, the spouse of the owner, or the relatives no longer use the property as their 110.6homestead. Upon the sale or transfer of the homestead property, a certificate of value must 110.7be timely filed with the county auditor as provided under section 
         272.115. Failure to 110.8notify the assessor within 30 days that the property has been sold, transferred, or that the 110.9owner, the spouse of the owner, or the relative is no longer occupying the property as a 110.10homestead, shall result in the penalty provided under this subdivision and the property 110.11will lose its current homestead status.110.12    (f) If the homestead application is not returned within 30 days, the county will send a 110.13second application to the present owners of record. The notice of proposed property taxes 110.14prepared under section 
         275.065, subdivision 3, shall reflect the property's classification. If 110.15a homestead application has not been filed with the county by December 15, the assessor 110.16shall classify the property as nonhomestead for the current assessment year for taxes 110.17payable in the following year, provided that the owner may be entitled to receive the 110.18homestead classification by proper application under section 
         375.192.110.19    (g) At the request of the commissioner, each county must give the commissioner a 110.20list that includes the name and Social Security number of each occupant of homestead 110.21property who is the property owner, property owner's spouse, qualifying relative of a 110.22property owner, or a spouse of a qualifying relative. The commissioner shall use the 110.23information provided on the lists as appropriate under the law, including for the detection 110.24of improper claims by owners, or relatives of owners, under chapter 290A.110.25    (h) If the commissioner finds that a property owner may be claiming a fraudulent 110.26homestead, the commissioner shall notify the appropriate counties. Within 90 days of 110.27the notification, the county assessor shall investigate to determine if the homestead 110.28classification was properly claimed. If the property owner does not qualify, the county 110.29assessor shall notify the county auditor who will determine the amount of homestead 110.30benefits that had been improperly allowed. For the purpose of this section, "homestead 110.31benefits" means the tax reduction resulting from the classification as a homestead and the 110.32homestead market value exclusion under section 
         273.13, the taconite homestead credit 110.33under section 
         273.135, the residential homestead and agricultural homestead credits credit110.34under section 
         273.1384, and the supplemental homestead credit under section 
         273.1391.110.35    The county auditor shall send a notice to the person who owned the affected property 110.36at the time the homestead application related to the improper homestead was filed, 111.1demanding reimbursement of the homestead benefits plus a penalty equal to 100 percent 111.2of the homestead benefits. The person notified may appeal the county's determination 111.3by serving copies of a petition for review with county officials as provided in section 111.4278.01
          and filing proof of service as provided in section 
         278.01 with the Minnesota Tax 111.5Court within 60 days of the date of the notice from the county. Procedurally, the appeal 111.6is governed by the provisions in chapter 271 which apply to the appeal of a property tax 111.7assessment or levy, but without requiring any prepayment of the amount in controversy. If 111.8the amount of homestead benefits and penalty is not paid within 60 days, and if no appeal 111.9has been filed, the county auditor shall certify the amount of taxes and penalty to the county 111.10treasurer. The county treasurer will add interest to the unpaid homestead benefits and 111.11penalty amounts at the rate provided in section 
         279.03 for real property taxes becoming 111.12delinquent in the calendar year during which the amount remains unpaid. Interest may be 111.13assessed for the period beginning 60 days after demand for payment was made.111.14    If the person notified is the current owner of the property, the treasurer may add the 111.15total amount of homestead benefits, penalty, interest, and costs to the ad valorem taxes 111.16otherwise payable on the property by including the amounts on the property tax statements 111.17under section 
         276.04, subdivision 3. The amounts added under this paragraph to the ad 111.18valorem taxes shall include interest accrued through December 31 of the year preceding 111.19the taxes payable year for which the amounts are first added. These amounts, when added 111.20to the property tax statement, become subject to all the laws for the enforcement of real or 111.21personal property taxes for that year, and for any subsequent year.111.22    If the person notified is not the current owner of the property, the treasurer may 111.23collect the amounts due under the Revenue Recapture Act in chapter 270A, or use any of 111.24the powers granted in sections 
         277.20 and 
         277.21 without exclusion, to enforce payment 111.25of the homestead benefits, penalty, interest, and costs, as if those amounts were delinquent 111.26tax obligations of the person who owned the property at the time the application related 111.27to the improperly allowed homestead was filed. The treasurer may relieve a prior owner 111.28of personal liability for the homestead benefits, penalty, interest, and costs, and instead 111.29extend those amounts on the tax lists against the property as provided in this paragraph 111.30to the extent that the current owner agrees in writing. On all demands, billings, property 111.31tax statements, and related correspondence, the county must list and state separately the 111.32amounts of homestead benefits, penalty, interest and costs being demanded, billed or 111.33assessed.111.34    (i) Any amount of homestead benefits recovered by the county from the property 111.35owner shall be distributed to the county, city or town, and school district where the 111.36property is located in the same proportion that each taxing district's levy was to the total 112.1of the three taxing districts' levy for the current year. Any amount recovered attributable 112.2to taconite homestead credit shall be transmitted to the St. Louis County auditor to be 112.3deposited in the taconite property tax relief account. Any amount recovered that is 112.4attributable to supplemental homestead credit is to be transmitted to the commissioner of 112.5revenue for deposit in the general fund of the state treasury. The total amount of penalty 112.6collected must be deposited in the county general fund.112.7    (j) If a property owner has applied for more than one homestead and the county 112.8assessors cannot determine which property should be classified as homestead, the county 112.9assessors will refer the information to the commissioner. The commissioner shall make 112.10the determination and notify the counties within 60 days.112.11    (k) In addition to lists of homestead properties, the commissioner may ask the 112.12counties to furnish lists of all properties and the record owners. The Social Security 112.13numbers and federal identification numbers that are maintained by a county or city 112.14assessor for property tax administration purposes, and that may appear on the lists retain 112.15their classification as private or nonpublic data; but may be viewed, accessed, and used by 112.16the county auditor or treasurer of the same county for the limited purpose of assisting the 112.17commissioner in the preparation of microdata samples under section 
         270C.12.112.18    (l) On or before April 30 each year beginning in 2007, each county must provide the 112.19commissioner with the following data for each parcel of homestead property by electronic 112.20means as defined in section 
         289A.02, subdivision 8:112.21    (i) the property identification number assigned to the parcel for purposes of taxes 112.22payable in the current year;112.23    (ii) the name and Social Security number of each occupant of homestead property 112.24who is the property owner, property owner's spouse, qualifying relative of a property 112.25owner, or spouse of a qualifying relative;112.26    (iii) the classification of the property under section 
         273.13 for taxes payable in the 112.27current year and in the prior year;112.28    (iv) an indication of whether the property was classified as a homestead for taxes 112.29payable in the current year because of occupancy by a relative of the owner or by a 112.30spouse of a relative;112.31    (v) the property taxes payable as defined in section 
         290A.03, subdivision 13, for the 112.32current year and the prior year;112.33    (vi) the market value of improvements to the property first assessed for tax purposes 112.34for taxes payable in the current year;112.35    (vii) the assessor's estimated market value assigned to the property for taxes payable 112.36in the current year and the prior year;113.1    (viii) the taxable market value assigned to the property for taxes payable in the 113.2current year and the prior year;113.3    (ix) whether there are delinquent property taxes owing on the homestead;113.4    (x) the unique taxing district in which the property is located; and113.5    (xi) such other information as the commissioner decides is necessary.113.6    The commissioner shall use the information provided on the lists as appropriate 113.7under the law, including for the detection of improper claims by owners, or relatives 113.8of owners, under chapter 290A.113.9EFFECTIVE DATE.This section is effective for taxes payable in 2012 and 113.10thereafter.113.11    Sec. 29. Minnesota Statutes 2010, section 273.13, subdivision 21b, is amended to read:113.12    Subd. 21b. Net tax capacity.(a) Gross tax capacity means the product of the 113.13appropriate gross class rates in this section and market values.113.14(b) Net tax capacity means the product of the appropriate net class rates in this 113.15section and taxable market values.113.16EFFECTIVE DATE.This section is effective the day following final enactment.113.17    Sec. 30. Minnesota Statutes 2010, section 273.1398, subdivision 3, is amended to read:113.18    Subd. 3. Disparity reduction aid.  The amount of disparity aid certified for each 113.19taxing district within each unique taxing jurisdiction for taxes payable in the prior year 113.20shall be multiplied by the ratio of (1) the jurisdiction's tax capacity using the class rates for 113.21taxes payable in the year for which aid is being computed, to (2) its tax capacity using 113.22the class rates for taxes payable in the year prior to that for which aid is being computed, 113.23both based upon taxable market values for taxes payable in the year prior to that for which 113.24aid is being computed. If the commissioner determines that insufficient information is 113.25available to reasonably and timely calculate the numerator in this ratio for the first taxes 113.26payable year that a class rate change or new class rate is effective, the commissioner shall 113.27omit the effects of that class rate change or new class rate when calculating this ratio for 113.28aid payable in that taxes payable year. For aid payable in the year following a year for 113.29which such omission was made, the commissioner shall use in the denominator for the 113.30class that was changed or created, the tax capacity for taxes payable two years prior to that 113.31in which the aid is payable, based on taxable market values for taxes payable in the year 113.32prior to that for which aid is being computed.114.1    Sec. 31. Minnesota Statutes 2010, section 273.1398, subdivision 4, is amended to read:114.2    Subd. 4. Disparity reduction credit. (a) Beginning with taxes payable in 1989, 114.3class 4a, class 3a, and class 3b property qualifies for a disparity reduction credit if: (1) 114.4the property is located in a border city that has an enterprise zone designated pursuant 114.5to section 
         469.168, subdivision 4; (2) the property is located in a city with a population 114.6greater than 2,500 and less than 35,000 according to the 1980 decennial census; (3) the 114.7city is adjacent to a city in another state or immediately adjacent to a city adjacent to a city 114.8in another state; and (4) the adjacent city in the other state has a population of greater than 114.95,000 and less than 75,000 according to the 1980 decennial census.114.10    (b) The credit is an amount sufficient to reduce (i) the taxes levied on class 4a 114.11property to 2.3 percent of the property's taxable market value and (ii) the tax on class 3a 114.12and class 3b property to 2.3 percent of taxable market value.114.13    (c) The county auditor shall annually certify the costs of the credits to the 114.14Department of Revenue. The department shall reimburse local governments for the 114.15property taxes forgone as the result of the credits in proportion to their total levies.114.16    Sec. 32. Minnesota Statutes 2010, section 275.011, subdivision 1, is amended to read:114.17    Subdivision 1. Determination of levy limit. The property tax levied for any 114.18purpose under a special law that is not codified in Minnesota Statutes or a city charter 114.19provision and that is subject to a mill rate limitation imposed by the special law or city 114.20charter provision, excluding levies subject to mill rate limitations that use adjusted 114.21assessed values determined by the commissioner of revenue under section 
         124.2131, must 114.22not exceed the following amount for the years specified:114.23(a) for taxes payable in 1988, the product of the applicable mill rate limitation 114.24imposed by special law or city charter provision multiplied by the total assessed valuation 114.25of all taxable property subject to the tax as adjusted by the provisions of Minnesota 114.26Statutes 1986, sections 
         272.64; 
         273.13, subdivision 7a; and 
         275.49;114.27(b) for taxes payable in 1989, the product of (1) the property tax levy limitation for 114.28the taxes payable year 1988 determined under clause (a) multiplied by (2) an index for 114.29market valuation changes equal to the assessment year 1988 total market valuation of all 114.30taxable property subject to the tax divided by the assessment year 1987 total market 114.31valuation of all taxable property subject to the tax; and114.32(c) for taxes payable in 1990 and subsequent years, the product of (1) the property 114.33tax levy limitation for the previous year determined pursuant to this subdivision multiplied 114.34by (2) an index for market valuation changes equal to the total market valuation of all 115.1taxable property subject to the tax for the current assessment year divided by the total 115.2market valuation of all taxable property subject to the tax for the previous assessment year.115.3For the purpose of determining the property tax levy limitation for the taxes payable 115.4year 1988 2013 and subsequent years under this subdivision, "total market valuation" 115.5means the total estimated market valuation value of all taxable property subject to the 115.6tax without valuation adjustments for fiscal disparities (chapters 276A and 473F), tax 115.7increment financing (sections 469.174 to 469.179), or powerline credit (section 273.425)115.8as provided under section 273.032.115.9    Sec. 33. Minnesota Statutes 2010, section 275.077, subdivision 2, is amended to read:115.10    Subd. 2. Correction of levy amount. The difference between the correct levy and 115.11the erroneous levy shall be added to the township levy for the subsequent levy year; 115.12provided that if the amount of the difference exceeds 0.12089 percent of taxable estimated115.13market value, the excess shall be added to the township levy for the second and later 115.14subsequent levy years, not to exceed an additional levy of 0.12089 percent of taxable115.15estimated market value in any year, until the full amount of the difference has been levied. 115.16The funds collected from the corrected levies shall be used to reimburse the county for the 115.17payment required by subdivision 1.115.18    Sec. 34. Minnesota Statutes 2010, section 275.71, subdivision 4, is amended to read:115.19    Subd. 4. Adjusted levy limit base.  For taxes levied in 2008 through 2010, the 115.20adjusted levy limit base is equal to the levy limit base computed under subdivision 2 115.21or section 
         275.72, multiplied by:115.22    (1) one plus the percentage growth in the implicit price deflator, but the percentage 115.23shall not be less than zero or exceed 3.9 percent;115.24    (2) one plus a percentage equal to 50 percent of the percentage increase in the number 115.25of households, if any, for the most recent 12-month period for which data is available; and115.26    (3) one plus a percentage equal to 50 percent of the percentage increase in the 115.27taxable estimated market value of the jurisdiction due to new construction of class 3 115.28property, as defined in section 
         273.13, subdivision 4, except for state-assessed utility and 115.29railroad property, for the most recent year for which data is available.115.30    Sec. 35. Minnesota Statutes 2011 Supplement, section 276.04, subdivision 2, is 115.31amended to read:115.32    Subd. 2. Contents of tax statements. (a) The treasurer shall provide for the 115.33printing of the tax statements. The commissioner of revenue shall prescribe the form of 116.1the property tax statement and its contents. The tax statement must not state or imply 116.2that property tax credits are paid by the state of Minnesota. The statement must contain 116.3a tabulated statement of the dollar amount due to each taxing authority and the amount 116.4of the state tax from the parcel of real property for which a particular tax statement is 116.5prepared. The dollar amounts attributable to the county, the state tax, the voter approved 116.6school tax, the other local school tax, the township or municipality, and the total of 116.7the metropolitan special taxing districts as defined in section 
         275.065, subdivision 3, 116.8paragraph (i), must be separately stated. The amounts due all other special taxing districts, 116.9if any, may be aggregated except that any levies made by the regional rail authorities in the 116.10county of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter 116.11398A shall be listed on a separate line directly under the appropriate county's levy. If the 116.12county levy under this paragraph includes an amount for a lake improvement district as 116.13defined under sections 
         103B.501 to 
         103B.581, the amount attributable for that purpose 116.14must be separately stated from the remaining county levy amount. In the case of Ramsey 116.15County, if the county levy under this paragraph includes an amount for public library 116.16service under section 
         134.07, the amount attributable for that purpose may be separated 116.17from the remaining county levy amount. The amount of the tax on homesteads qualifying 116.18under the senior citizens' property tax deferral program under chapter 290B is the total 116.19amount of property tax before subtraction of the deferred property tax amount. The 116.20amount of the tax on contamination value imposed under sections 
         270.91 to 
         270.98, if any, 116.21must also be separately stated. The dollar amounts, including the dollar amount of any 116.22special assessments, may be rounded to the nearest even whole dollar. For purposes of this 116.23section whole odd-numbered dollars may be adjusted to the next higher even-numbered 116.24dollar. The amount of market value excluded under section 
         273.11, subdivision 16, if any, 116.25must also be listed on the tax statement.116.26    (b) The property tax statements for manufactured homes and sectional structures 116.27taxed as personal property shall contain the same information that is required on the 116.28tax statements for real property.116.29    (c) Real and personal property tax statements must contain the following information 116.30in the order given in this paragraph. The information must contain the current year tax 116.31information in the right column with the corresponding information for the previous year 116.32in a column on the left:116.33    (1) the property's estimated market value under section 
         273.11, subdivision 1;116.34(2) the property's homestead market value exclusion under section 
         273.13, 116.35subdivision 35;117.1    (3) the property's taxable market value after reductions under sections 273.11, 117.2subdivisions 1a and 16, and 273.13, subdivision 35 section 272.03, subdivision 15;117.3    (4) the property's gross tax, before credits;117.4    (5) for homestead agricultural properties, the credit under section 
         273.1384;117.5    (6) any credits received under sections 
         273.119; 
         273.1234 or 
         273.1235; 
         273.135; 117.6273.1391
         ; 
         273.1398, subdivision 4; 
         469.171; and 
         473H.10, except that the amount of 117.7credit received under section 
         273.135 must be separately stated and identified as "taconite 117.8tax relief"; and117.9    (7) the net tax payable in the manner required in paragraph (a).117.10    (d) If the county uses envelopes for mailing property tax statements and if the county 117.11agrees, a taxing district may include a notice with the property tax statement notifying 117.12taxpayers when the taxing district will begin its budget deliberations for the current 117.13year, and encouraging taxpayers to attend the hearings. If the county allows notices to 117.14be included in the envelope containing the property tax statement, and if more than 117.15one taxing district relative to a given property decides to include a notice with the tax 117.16statement, the county treasurer or auditor must coordinate the process and may combine 117.17the information on a single announcement.117.18    Sec. 36. Minnesota Statutes 2010, section 276A.01, subdivision 10, is amended to read:117.19    Subd. 10. Adjusted market value. "Adjusted market value" of real and personal 117.20property within a municipality means the assessor's estimated taxable market value, 117.21as defined in section 272.03, of all real and personal property, including the value of 117.22manufactured housing, within the municipality. For purposes of sections 276A.01 to 117.23276A.09, the commissioner of revenue shall annually make determinations and reports 117.24with respect to each municipality which are comparable to those it makes for school 117.25districts, adjusted for sales ratios in a manner similar to the adjustments made to city and 117.26town net tax capacities under section 
         127A.48, subdivisions 1 to 6, in the same manner 117.27and at the same times prescribed by the subdivision. The commissioner of revenue shall 117.28annually determine, for each municipality, information comparable to that required by 117.29section 475.53, subdivision 4, for school districts, as soon as practicable after it becomes 117.30available. The commissioner of revenue shall then compute the equalized market value of 117.31property within each municipality.117.32EFFECTIVE DATE.This section is effective the day following final enactment.117.33    Sec. 37. Minnesota Statutes 2010, section 276A.01, subdivision 12, is amended to read:118.1    Subd. 12. Fiscal capacity. "Fiscal capacity" of a municipality means its valuation118.2adjusted market value, determined as of January 2 of any year, divided by its population, 118.3determined as of a date in the same year.118.4    Sec. 38. Minnesota Statutes 2010, section 276A.01, subdivision 13, is amended to read:118.5    Subd. 13. Average fiscal capacity. "Average fiscal capacity" of municipalities 118.6means the sum of the valuations adjusted market values of all municipalities, determined 118.7as of January 2 of any year, divided by the sum of their populations, determined as of 118.8a date in the same year.118.9    Sec. 39. Minnesota Statutes 2010, section 276A.01, subdivision 15, is amended to read:118.10    Subd. 15. Net tax capacity. "Net tax capacity" means the taxable market value of 118.11real and personal property multiplied by its net tax capacity rates in section 
         273.13.118.12    Sec. 40. Minnesota Statutes 2010, section 287.08, is amended to read:118.13287.08 TAX, HOW PAYABLE; RECEIPTS.118.14    (a) The tax imposed by sections 
         287.01 to 
         287.12 must be paid to the treasurer of 118.15any county in this state in which the real property or some part is located at or before 118.16the time of filing the mortgage for record. The treasurer shall endorse receipt on the 118.17mortgage and the receipt is conclusive proof that the tax has been paid in the amount 118.18stated and authorizes any county recorder or registrar of titles to record the mortgage. Its 118.19form, in substance, shall be "registration tax hereon of ..................... dollars paid." If the 118.20mortgage is exempt from taxation the endorsement shall, in substance, be "exempt from 118.21registration tax." In either case the receipt must be signed by the treasurer. In case the 118.22treasurer is unable to determine whether a claim of exemption should be allowed, the tax 118.23must be paid as in the case of a taxable mortgage. For documents submitted electronically, 118.24the endorsements and tax amount shall be affixed electronically and no signature by the 118.25treasurer will be required. The actual payment method must be arranged in advance 118.26between the submitter and the receiving county.118.27    (b) The county treasurer may refund in whole or in part any mortgage registry tax 118.28overpayment if a written application by the taxpayer is submitted to the county treasurer 118.29within 3-1/2 years from the date of the overpayment. If the county has not issued a denial 118.30of the application, the taxpayer may bring an action in Tax Court in the county in which 118.31the tax was paid at any time after the expiration of six months from the time that the 118.32application was submitted. A denial of refund may be appealed within 60 days from 118.33the date of the denial by bringing an action in Tax Court in the county in which the tax 119.1was paid. The action is commenced by the serving of a petition for relief on the county 119.2treasurer, and by filing a copy with the court. The county attorney shall defend the action. 119.3The county treasurer shall notify the treasurer of each county that has or would receive a 119.4portion of the tax as paid.119.5    (c) If the county treasurer determines a refund should be paid, or if a refund is 119.6ordered by the court, the county treasurer of each county that actually received a portion 119.7of the tax shall immediately pay a proportionate share of three percent of the refund 119.8using any available county funds. The county treasurer of each county that received, or 119.9would have received, a portion of the tax shall also pay their county's proportionate share 119.10of the remaining 97 percent of the court-ordered refund on or before the 20th day of the 119.11following month using solely the mortgage registry tax funds that would be paid to the 119.12commissioner of revenue on that date under section 
         287.12. If the funds on hand under 119.13this procedure are insufficient to fully fund 97 percent of the court-ordered refund, the 119.14county treasurer of the county in which the action was brought shall file a claim with the 119.15commissioner of revenue under section 
         16A.48 for the remaining portion of 97 percent of 119.16the refund, and shall pay over the remaining portion upon receipt of a warrant from the 119.17state issued pursuant to the claim.119.18    (d) When any mortgage covers real property located in more than one county in this 119.19state the total tax must be paid to the treasurer of the county where the mortgage is first 119.20presented for recording, and the payment must be receipted as provided in paragraph 119.21(a). If the principal debt or obligation secured by such a multiple county mortgage 119.22exceeds $10,000,000, the nonstate portion of the tax must be divided and paid over by 119.23the county treasurer receiving it, on or before the 20th day of each month after receipt, 119.24to the county or counties entitled in the ratio that the estimated market value of the real 119.25property covered by the mortgage in each county bears to the estimated market value of 119.26all the real property in this state described in the mortgage. In making the division and 119.27payment the county treasurer shall send a statement giving the description of the real 119.28property described in the mortgage and the estimated market value of the part located in 119.29each county. For this purpose, the treasurer of any county may require the treasurer of 119.30any other county to certify to the former the estimated market valuation value of any tract 119.31of real property in any mortgage.119.32    (e) The mortgagor must pay the tax imposed by sections 
         287.01 to 
         287.12. The 119.33mortgagee may undertake to collect and remit the tax on behalf of the mortgagor. If the 119.34mortgagee collects money from the mortgagor to remit the tax on behalf of the mortgagor, 119.35the mortgagee has a fiduciary duty to remit the tax on behalf of the mortgagor as to the 120.1amount of the tax collected for that purpose and the mortgagor is relieved of any further 120.2obligation to pay the tax as to the amount collected by the mortgagee for this purpose.120.3    Sec. 41. Minnesota Statutes 2010, section 287.23, subdivision 1, is amended to read:120.4    Subdivision 1. Real property outside county. If any taxable deed or instrument 120.5describes any real property located in more than one county in this state, the total tax must 120.6be paid to the treasurer of the county where the document is first presented for recording, 120.7and the payment must be receipted as provided in section 
         287.08. If the net consideration 120.8exceeds $700,000, the nonstate portion of the tax must be divided and paid over by the 120.9county treasurer receiving it, on or before the 20th day of each month after receipt, to 120.10the county or counties entitled in the ratio which the estimated market value of the real 120.11property covered by the document in each county bears to the estimated market value of 120.12all the real property in this state described in the document. In making the division and 120.13payment the county treasurer shall send a statement to the other involved counties giving 120.14the description of the real property described in the document and the estimated market 120.15value of the part located in each county. The treasurer of any county may require the 120.16treasurer of any other county to certify to the former the estimated market valuation value120.17of any parcel of real property for this purpose.120.18    Sec. 42. Minnesota Statutes 2010, section 353G.08, subdivision 2, is amended to read:120.19    Subd. 2. Cash flow funding requirement. If the executive director determines that 120.20an account in the voluntary statewide lump-sum volunteer firefighter retirement plan has 120.21insufficient assets to meet the service pensions determined payable from the account, 120.22the executive director shall certify the amount of the potential service pension shortfall 120.23to the municipality or municipalities and the municipality or municipalities shall make 120.24an additional employer contribution to the account within ten days of the certification. 120.25If more than one municipality is associated with the account, unless the municipalities 120.26agree to a different allocation, the municipalities shall allocate the additional employer 120.27contribution one-half in proportion to the population of each municipality and one-half in 120.28proportion to the estimated market value of the property of each municipality.120.29    Sec. 43. Minnesota Statutes 2010, section 365.025, subdivision 4, is amended to read:120.30    Subd. 4. Major purchases: notice, petition, election. Before buying anything 120.31under subdivision 2 that costs more than 0.24177 percent of the estimated market value of 120.32the town, the town must follow this subdivision.121.1The town must publish in its official newspaper the board's resolution to pay for the 121.2property over time. Then a petition for an election on the contract may be filed with the 121.3clerk. The petition must be filed within ten days after the resolution is published. To 121.4require the election the petition must be signed by a number of voters equal to ten percent 121.5of the voters at the last regular town election. The contract then must be approved by a 121.6majority of those voting on the question. The question may be voted on at a regular 121.7or special election.121.8    Sec. 44. Minnesota Statutes 2010, section 366.095, subdivision 1, is amended to read:121.9    Subdivision 1. Certificates of indebtedness. The town board may issue certificates 121.10of indebtedness within the debt limits for a town purpose otherwise authorized by law. 121.11The certificates shall be payable in not more than ten years and be issued on the terms and 121.12in the manner as the board may determine. If the amount of the certificates to be issued 121.13exceeds 0.25 percent of the estimated market value of the town, they shall not be issued 121.14for at least ten days after publication in a newspaper of general circulation in the town of 121.15the board's resolution determining to issue them. If within that time, a petition asking for 121.16an election on the proposition signed by voters equal to ten percent of the number of voters 121.17at the last regular town election is filed with the clerk, the certificates shall not be issued 121.18until their issuance has been approved by a majority of the votes cast on the question at 121.19a regular or special election. A tax levy shall be made to pay the principal and interest 121.20on the certificates as in the case of bonds.121.21    Sec. 45. Minnesota Statutes 2010, section 366.27, is amended to read:121.22366.27 FIREFIGHTERS' RELIEF; TAX LEVY.121.23The town board of any town in this state having therein a platted portion on 121.24which resides 1,200 or more people, and wherein a duly incorporated firefighters' relief 121.25association is located may each year levy a tax not to exceed 0.00806 percent of taxable121.26estimated market value for the benefit of the relief association.121.27    Sec. 46. Minnesota Statutes 2010, section 368.01, subdivision 23, is amended to read:121.28    Subd. 23. Financing purchase of certain equipment. The town board may issue 121.29certificates of indebtedness within debt limits to purchase fire or police equipment or 121.30ambulance equipment or street construction or maintenance equipment. The certificates 121.31shall be payable in not more than five years and be issued on terms and in the manner 121.32as the board may determine. If the amount of the certificates to be issued to finance a 121.33purchase exceeds 0.24177 percent of the estimated market value of the town, excluding 122.1money and credits, they shall not be issued for at least ten days after publication in the 122.2official newspaper of a town board resolution determining to issue them. If before the end 122.3of that time, a petition asking for an election on the proposition signed by voters equal 122.4to ten percent of the number of voters at the last regular town election is filed with the 122.5clerk, the certificates shall not be issued until the proposition of their issuance has been 122.6approved by a majority of the votes cast on the question at a regular or special election. 122.7A tax levy shall be made for the payment of the principal and interest on the certificates 122.8as in the case of bonds.122.9    Sec. 47. Minnesota Statutes 2010, section 368.47, is amended to read:122.10368.47 TOWNS MAY BE DISSOLVED.122.11(1) When the voters residing within a town have failed to elect any town officials for 122.12more than ten years continuously;122.13(2) when a town has failed for a period of ten years to exercise any of the powers 122.14and functions of a town;122.15(3) when the estimated market value of a town drops to less than $165,000;122.16(4) when the tax delinquency of a town, exclusive of taxes that are delinquent or 122.17unpaid because they are contested in proceedings for the enforcement of taxes, amounts to 122.1812 percent of its market value; or122.19(5) when the state or federal government has acquired title to 50 percent of the 122.20real estate of a town,122.21which facts, or any of them, may be found and determined by the resolution of the county 122.22board of the county in which the town is located, according to the official records in the 122.23office of the county auditor, the county board by resolution may declare the town, naming 122.24it, dissolved and no longer entitled to exercise any of the powers or functions of a town.122.25In Cass, Itasca, and St. Louis Counties, before the dissolution is effective the voters 122.26of the town shall express their approval or disapproval. The town clerk shall, upon a 122.27petition signed by a majority of the registered voters of the town, filed with the clerk at 122.28least 60 days before a regular or special town election, give notice at the same time and 122.29in the same manner of the election that the question of dissolution of the town will be 122.30submitted for determination at the election. At the election the question shall be voted 122.31upon by a separate ballot, the terms of which shall be either "for dissolution" or "against 122.32dissolution." The ballot shall be deposited in a separate ballot box and the result of the 122.33voting canvassed, certified, and returned in the same manner and at the same time as 122.34other facts and returns of the election. If a majority of the votes cast at the election are 123.1for dissolution, the town shall be dissolved. If a majority of the votes cast at the election 123.2are against dissolution, the town shall not be dissolved.123.3When a town is dissolved under sections 
         368.47 to 
         368.49 the county shall acquire 123.4title to any telephone company or other business conducted by the town. The business 123.5shall be operated by the board of county commissioners until it can be sold. The 123.6subscribers or patrons of the business shall have the first opportunity of purchase. If the 123.7town has any outstanding indebtedness chargeable to the business, the county auditor shall 123.8levy a tax against the property situated in the dissolved town to pay the indebtedness 123.9as it becomes due.123.10    Sec. 48. Minnesota Statutes 2010, section 370.01, is amended to read:123.11370.01 CHANGE OF BOUNDARIES; CREATION OF NEW COUNTIES.123.12The boundaries of counties may be changed by taking territory from a county and 123.13attaching it to an adjoining county, and new counties may be established out of territory of 123.14one or more existing counties. A new county shall contain at least 400 square miles and 123.15have at least 4,000 inhabitants. A proposed new county must have a total taxable estimated123.16market value of at least 35 percent of (i) the total taxable estimated market value of the 123.17existing county, or (ii) the average total taxable estimated market value of the existing 123.18counties, included in the proposition. The determination of the taxable estimated market 123.19value of a county must be made by the commissioner of revenue. An existing county shall 123.20not be reduced in area below 400 square miles, have less than 4,000 inhabitants, or have a 123.21total taxable estimated market value of less than that required of a new county.123.22No change in the boundaries of any county having an area of more than 2,500 square 123.23miles, whether by the creation of a new county, or otherwise, shall detach from the existing 123.24county any territory within 12 miles of the county seat.123.25    Sec. 49. Minnesota Statutes 2010, section 373.40, subdivision 1, is amended to read:123.26    Subdivision 1. Definitions. For purposes of this section, the following terms have 123.27the meanings given.123.28(a) "Bonds" means an obligation as defined under section 
         475.51.123.29(b) "Capital improvement" means acquisition or betterment of public lands, 123.30buildings, or other improvements within the county for the purpose of a county courthouse, 123.31administrative building, health or social service facility, correctional facility, jail, law 123.32enforcement center, hospital, morgue, library, park, qualified indoor ice arena, roads and 123.33bridges, and the acquisition of development rights in the form of conservation easements 123.34under chapter 84C. An improvement must have an expected useful life of five years or 124.1more to qualify. "Capital improvement" does not include a recreation or sports facility 124.2building (such as, but not limited to, a gymnasium, ice arena, racquet sports facility, 124.3swimming pool, exercise room or health spa), unless the building is part of an outdoor 124.4park facility and is incidental to the primary purpose of outdoor recreation.124.5(c) "Metropolitan county" means a county located in the seven-county metropolitan 124.6area as defined in section 
         473.121 or a county with a population of 90,000 or more.124.7(d) "Population" means the population established by the most recent of the 124.8following (determined as of the date the resolution authorizing the bonds was adopted):124.9(1) the federal decennial census,124.10(2) a special census conducted under contract by the United States Bureau of the 124.11Census, or124.12(3) a population estimate made either by the Metropolitan Council or by the state 124.13demographer under section 
         4A.02.124.14(e) "Qualified indoor ice arena" means a facility that meets the requirements of 124.15section 
         373.43.124.16(f) "Tax capacity" means total taxable market value, but does not include captured 124.17market value.124.18    Sec. 50. Minnesota Statutes 2010, section 373.40, subdivision 4, is amended to read:124.19    Subd. 4. Limitations on amount. A county may not issue bonds under this section 124.20if the maximum amount of principal and interest to become due in any year on all the 124.21outstanding bonds issued pursuant to this section (including the bonds to be issued) will 124.22equal or exceed 0.12 percent of taxable the estimated market value of property in the 124.23county. Calculation of the limit must be made using the taxable estimated market value for 124.24the taxes payable year in which the obligations are issued and sold. This section does not 124.25limit the authority to issue bonds under any other special or general law.124.26    Sec. 51. Minnesota Statutes 2010, section 375.167, subdivision 1, is amended to read:124.27    Subdivision 1. Appropriations. Notwithstanding any contrary law, a county board 124.28may appropriate from the general revenue fund to any nonprofit corporation a sum not 124.29to exceed 0.00604 percent of taxable estimated market value to provide legal assistance 124.30to persons who are unable to afford private legal counsel.124.31    Sec. 52. Minnesota Statutes 2010, section 375.18, subdivision 3, is amended to read:124.32    Subd. 3. Courthouse. Each county board may erect, furnish, and maintain a 124.33suitable courthouse. No indebtedness shall be created for a courthouse in excess of an 125.1amount equal to a levy of 0.04030 percent of taxable estimated market value without the 125.2approval of a majority of the voters of the county voting on the question of issuing the 125.3obligation at an election.125.4    Sec. 53. Minnesota Statutes 2010, section 375.555, is amended to read:125.5375.555 FUNDING.125.6To implement the county emergency jobs program, the county board may expend 125.7an amount equal to what would be generated by a levy of 0.01209 percent of taxable125.8estimated market value. The money to be expended may be from any available funds 125.9not otherwise earmarked.125.10    Sec. 54. Minnesota Statutes 2010, section 383B.152, is amended to read:125.11383B.152 BUILDING AND MAINTENANCE FUND.125.12The county board may by resolution levy a tax to provide money which shall be kept 125.13in a fund known as the county reserve building and maintenance fund. Money in the fund 125.14shall be used solely for the construction, maintenance, and equipping of county buildings 125.15that are constructed or maintained by the board. The levy shall not be subject to any limit 125.16fixed by any other law or by any board of tax levy or other corresponding body, but shall 125.17not exceed 0.02215 percent of taxable estimated market value, less the amount required by 125.18chapter 475 to be levied in the year for the payment of the principal of and interest on all 125.19bonds issued pursuant to Extra Session Laws 1967, chapter 47, section 1.125.20    Sec. 55. Minnesota Statutes 2010, section 383B.245, is amended to read:125.21383B.245 LIBRARY LEVY.125.22    (a) The county board may levy a tax on the taxable property within the county to 125.23acquire, better, and construct county library buildings and branches and to pay principal 125.24and interest on bonds issued for that purpose.125.25    (b) The county board may by resolution adopted by a five-sevenths vote issue and 125.26sell general obligation bonds of the county in the manner provided in sections 
         475.60 to 125.27475.73
         . The bonds shall not be subject to the limitations of sections 
         475.51 to 
         475.59, 125.28but the maturity years and amounts and interest rates of each series of bonds shall be 125.29fixed so that the maximum amount of principal and interest to become due in any year, 125.30on the bonds of that series and of all outstanding series issued by or for the purposes of 125.31libraries, shall not exceed an amount equal to 0.01612 percent of estimated market value 125.32of all taxable property in the county as last finally equalized before the issuance of the new 126.1series. When the tax levy authorized in this section is collected it shall be appropriated 126.2and credited to a debt service fund for the bonds in amounts required each year in lieu of a 126.3countywide tax levy for the debt service fund under section 
         475.61.126.4    Sec. 56. Minnesota Statutes 2010, section 383B.73, subdivision 1, is amended to read:126.5    Subdivision 1. Levy. To provide funds for the purposes of the Three Rivers Park 126.6District as set forth in its annual budget, in lieu of the levies authorized by any other 126.7special law for such purposes, the Board of Park District Commissioners may levy 126.8taxes on all the taxable property in the county and park district at a rate not exceeding 126.90.03224 percent of estimated market value. Notwithstanding section 
         398.16, on or before 126.10October 1 of each year, after public hearing, the Board of Park District Commissioners 126.11shall adopt a budget for the ensuing year and shall determine the total amount necessary 126.12to be raised from ad valorem tax levies to meet its budget. The Board of Park District 126.13Commissioners shall submit the budget to the county board. The county board may veto 126.14or modify an item contained in the budget. If the county board determines to veto or to 126.15modify an item in the budget, it must, within 15 days after the budget was submitted by 126.16the district board, state in writing the specific reasons for its objection to the item vetoed 126.17or the reason for the modification. The Park District Board, after consideration of the 126.18county board's objections and proposed modifications, may reapprove a vetoed item or the 126.19original version of an item with respect to which a modification has been proposed, by a 126.20two-thirds majority. If the district board does not reapprove a vetoed item, the item shall 126.21be deleted from the budget. If the district board does not reapprove the original version 126.22of a modified item, the item shall be included in the budget as modified by the county 126.23board. After adoption of the final budget and no later than October 1, the superintendent 126.24of the park district shall certify to the office of the Hennepin County director of tax and 126.25public records exercising the functions of the county auditor the total amount to be raised 126.26from ad valorem tax levies to meet its budget for the ensuing year. The director of tax 126.27and public records shall add the amount of any levy certified by the district to other tax 126.28levies on the property of the county within the district for collection by the director of tax 126.29and public records with other taxes. When collected, the director shall make settlement of 126.30such taxes with the district in the same manner as other taxes are distributed to the other 126.31political subdivisions in Hennepin County.126.32    Sec. 57. Minnesota Statutes 2010, section 383E.20, is amended to read:126.33383E.20 BONDING FOR COUNTY LIBRARY BUILDINGS.127.1    The Anoka County Board may, by resolution adopted by a four-sevenths vote, issue 127.2and sell general obligation bonds of the county in the manner provided in chapter 475 to 127.3acquire, better, and construct county library buildings. The bonds shall not be subject to the 127.4requirements of sections 475.57 to 475.59. The maturity years and amounts and interest 127.5rates of each series of bonds shall be fixed so that the maximum amount of principal and 127.6interest to become due in any year, on the bonds of that series and of all outstanding series 127.7issued by or for the purposes of libraries, shall not exceed an amount equal to .01 percent 127.8of the taxable estimated market value of all taxable property in the county, excluding any 127.9taxable property taxed by any city for the support of any free public library. When the tax 127.10levy authorized in this section is collected, it shall be appropriated and credited to a debt 127.11service fund for the bonds. The tax levy for the debt service fund under section 475.61 127.12shall be reduced by the amount available or reasonably anticipated to be available in the 127.13fund to make payments otherwise payable from the levy pursuant to section 475.61.127.14    Sec. 58. Minnesota Statutes 2010, section 383E.23, is amended to read:127.15383E.23 LIBRARY TAX.127.16The Anoka County Board may levy a tax of not more than .01 percent of the taxable127.17estimated market value of taxable property located within the county excluding any 127.18taxable property taxed by any city for the support of any free public library, to acquire, 127.19better, and construct county library buildings and to pay principal and interest on bonds 127.20issued for that purpose. The tax shall be disregarded in the calculation of levies or limits 127.21on levies provided by section 373.40, or other law.127.22    Sec. 59. Minnesota Statutes 2010, section 385.31, is amended to read:127.23385.31 PAYMENT OF COUNTY ORDERS OR WARRANTS.127.24When any order or warrant drawn on the treasurer is presented for payment, if there 127.25is money in the treasury for that purpose, the county treasurer shall redeem the same, and 127.26write across the entire face thereof the word "redeemed," the date of the redemption, and 127.27the treasurer's official signature. If there is not sufficient funds in the proper accounts to 127.28pay such orders they shall be numbered and registered in their order of presentation, 127.29and proper endorsement thereof shall be made on such orders and they shall be entitled 127.30to payment in like order. Such orders shall bear interest at not to exceed the rate of six 127.31percent per annum from such date of presentment. The treasurer, as soon as there is 127.32sufficient money in the treasury, shall appropriate and set apart a sum sufficient for the 127.33payment of the orders so presented and registered, and, if entitled to interest, issue to the 127.34original holder a notice that interest will cease in 30 days from the date of such notice; and, 128.1if orders thus entitled to priority of payment are not then presented, the next in order of 128.2registry may be paid until such orders are presented. No interest shall be paid on any order, 128.3except upon a warrant drawn by the county auditor for that purpose, giving the number 128.4and the date of the order on account of which the interest warrant is drawn. In any county 128.5in this state now or hereafter having a an estimated market value of all taxable property, 128.6exclusive of money and credits, of not less than $1,033,000,000, the county treasurer, in 128.7order to save payment of interest on county warrants drawn upon a fund in which there 128.8shall be temporarily insufficient money in the treasury to redeem the same, may borrow 128.9temporarily from any other fund in the county treasury in which there is a sufficient balance 128.10to care for the needs of such fund and allow a temporary loan or transfer to any other fund, 128.11and may pay such warrants out of such funds. Any such money so transferred and used in 128.12redeeming such county warrants shall be returned to the fund from which drawn as soon 128.13as money shall come in to the credit of such fund on which any such warrant was drawn 128.14and paid as aforesaid. Any county operating on a cash basis may use a combined form of 128.15warrant or order and check, which, when signed by the chair of the county board and by 128.16the auditor, is an order or warrant for the payment of the claim, and, when countersigned 128.17by the county treasurer, is a check for the payment of the amount thereof.128.18    Sec. 60. Minnesota Statutes 2010, section 394.36, subdivision 1, is amended to read:128.19    Subdivision 1. Continuation of nonconformity; limitations. Except as provided in 128.20subdivision 2, 3, or 4, any nonconformity, including the lawful use or occupation of land 128.21or premises existing at the time of the adoption of an official control under this chapter, 128.22may be continued, although the use or occupation does not conform to the official control. 128.23If the nonconformity or occupancy is discontinued for a period of more than one year, or 128.24any nonconforming building or structure is destroyed by fire or other peril to the extent of 128.2550 percent of its estimated market value, any subsequent use or occupancy of the land or 128.26premises shall be a conforming use or occupancy.128.27    Sec. 61. Minnesota Statutes 2010, section 398A.04, subdivision 8, is amended to read:128.28    Subd. 8. Taxation. Before deciding to exercise the power to tax, the authority shall 128.29give six weeks' published notice in all municipalities in the region. If a number of voters 128.30in the region equal to five percent of those who voted for candidates for governor at the 128.31last gubernatorial election present a petition within nine weeks of the first published notice 128.32to the secretary of state requesting that the matter be submitted to popular vote, it shall be 128.33submitted at the next general election. The question prepared shall be:128.34"Shall the regional rail authority have the power to impose a property tax?

129.1Yes 
                     							.....
                     						129.2No 
                     							.....
                     						"

129.3If a majority of those voting on the question approve or if no petition is presented 129.4within the prescribed time the authority may levy a tax at any annual rate not exceeding 129.50.04835 percent of estimated market value of all taxable property situated within the 129.6municipality or municipalities named in its organization resolution. Its recording officer 129.7shall file, on or before September 15, in the office of the county auditor of each county 129.8in which territory under the jurisdiction of the authority is located a certified copy of the 129.9board of commissioners' resolution levying the tax, and each county auditor shall assess 129.10and extend upon the tax rolls of each municipality named in the organization resolution the 129.11portion of the tax that bears the same ratio to the whole amount that the net tax capacity of 129.12taxable property in that municipality bears to the net tax capacity of taxable property in 129.13all municipalities named in the organization resolution. Collections of the tax shall be 129.14remitted by each county treasurer to the treasurer of the authority. For taxes levied in 1991, 129.15the amount levied for light rail transit purposes under this subdivision shall not exceed 75 129.16percent of the amount levied in 1990 for light rail transit purposes under this subdivision.129.17    Sec. 62. Minnesota Statutes 2010, section 401.05, subdivision 3, is amended to read:129.18    Subd. 3. Leasing. (a) A county or joint powers board of a group of counties 129.19which acquires or constructs and equips or improves facilities under this chapter may, 129.20with the approval of the board of county commissioners of each county, enter into a 129.21lease agreement with a city situated within any of the counties, or a county housing and 129.22redevelopment authority established under chapter 469 or any special law. Under the lease 129.23agreement, the city or county housing and redevelopment authority shall:129.24(1) construct or acquire and equip or improve a facility in accordance with plans 129.25prepared by or at the request of a county or joint powers board of the group of counties 129.26and approved by the commissioner of corrections; and129.27(2) finance the facility by the issuance of revenue bonds.129.28(b) The county or joint powers board of a group of counties may lease the facility 129.29site, improvements, and equipment for a term upon rental sufficient to produce revenue 129.30for the prompt payment of the revenue bonds and all interest accruing on them. Upon 129.31completion of payment, the lessee shall acquire title. The real and personal property 129.32acquired for the facility constitutes a project and the lease agreement constitutes a revenue 129.33agreement as provided in sections 
         469.152 to 
         469.165. All proceedings by the city or 129.34county housing and redevelopment authority and the county or joint powers board shall be 129.35as provided in sections 
         469.152 to 
         469.165, with the following adjustments:130.1(1) no tax may be imposed upon the property;130.2(2) the approval of the project by the commissioner of employment and economic 130.3development is not required;130.4(3) the Department of Corrections shall be furnished and shall record information 130.5concerning each project as it may prescribe, in lieu of reports required on other projects to 130.6the commissioner of employment and economic development;130.7(4) the rentals required to be paid under the lease agreement shall not exceed in any 130.8year one-tenth of one percent of the estimated market value of property within the county 130.9or group of counties as last equalized before the execution of the lease agreement;130.10(5) the county or group of counties shall provide for payment of all rentals due 130.11during the term of the lease agreement in the manner required in subdivision 4;130.12(6) no mortgage on the facilities shall be granted for the security of the bonds, but 130.13compliance with clause (5) may be enforced as a nondiscretionary duty of the county 130.14or group of counties; and130.15(7) the county or the joint powers board of the group of counties may sublease any 130.16part of the facilities for purposes consistent with their maintenance and operation.130.17    Sec. 63. Minnesota Statutes 2010, section 410.32, is amended to read:130.18410.32 CITIES MAY ISSUE CAPITAL NOTES FOR CAPITAL EQUIPMENT.130.19    (a) Notwithstanding any contrary provision of other law or charter, a home rule 130.20charter city may, by resolution and without public referendum, issue capital notes subject 130.21to the city debt limit to purchase capital equipment.130.22    (b) For purposes of this section, "capital equipment" means:130.23    (1) public safety equipment, ambulance and other medical equipment, road 130.24construction and maintenance equipment, and other capital equipment; and130.25    (2) computer hardware and software, whether bundled with machinery or equipment 130.26or unbundled.130.27    (c) The equipment or software must have an expected useful life at least as long 130.28as the term of the notes.130.29    (d) The notes shall be payable in not more than ten years and be issued on terms 130.30and in the manner the city determines. The total principal amount of the capital notes 130.31issued in a fiscal year shall not exceed 0.03 percent of the estimated market value of 130.32taxable property in the city for that year.130.33    (e) A tax levy shall be made for the payment of the principal and interest on the 130.34notes, in accordance with section 
         475.61, as in the case of bonds.131.1    (f) Notes issued under this section shall require an affirmative vote of two-thirds of 131.2the governing body of the city.131.3    (g) Notwithstanding a contrary provision of other law or charter, a home rule charter 131.4city may also issue capital notes subject to its debt limit in the manner and subject to the 131.5limitations applicable to statutory cities pursuant to section 
         412.301.131.6    Sec. 64. Minnesota Statutes 2010, section 412.221, subdivision 2, is amended to read:131.7    Subd. 2. Contracts. The council shall have power to make such contracts as may 131.8be deemed necessary or desirable to make effective any power possessed by the council. 131.9The city may purchase personal property through a conditional sales contract and real 131.10property through a contract for deed under which contracts the seller is confined to the 131.11remedy of recovery of the property in case of nonpayment of all or part of the purchase 131.12price, which shall be payable over a period of not to exceed five years. When the contract 131.13price of property to be purchased by contract for deed or conditional sales contract 131.14exceeds 0.24177 percent of the estimated market value of the city, the city may not enter 131.15into such a contract for at least ten days after publication in the official newspaper of a 131.16council resolution determining to purchase property by such a contract; and, if before the 131.17end of that time a petition asking for an election on the proposition signed by voters equal 131.18to ten percent of the number of voters at the last regular city election is filed with the clerk, 131.19the city may not enter into such a contract until the proposition has been approved by a 131.20majority of the votes cast on the question at a regular or special election.131.21    Sec. 65. Minnesota Statutes 2010, section 412.301, is amended to read:131.22412.301 FINANCING PURCHASE OF CERTAIN EQUIPMENT.131.23    (a) The council may issue certificates of indebtedness or capital notes subject to the 131.24city debt limits to purchase capital equipment.131.25    (b) For purposes of this section, "capital equipment" means:131.26    (1) public safety equipment, ambulance and other medical equipment, road 131.27construction and maintenance equipment, and other capital equipment; and131.28    (2) computer hardware and software, whether bundled with machinery or equipment 131.29or unbundled.131.30    (c) The equipment or software must have an expected useful life at least as long as 131.31the terms of the certificates or notes.131.32    (d) Such certificates or notes shall be payable in not more than ten years and shall be 131.33issued on such terms and in such manner as the council may determine.132.1    (e) If the amount of the certificates or notes to be issued to finance any such purchase 132.2exceeds 0.25 percent of the estimated market value of taxable property in the city, they 132.3shall not be issued for at least ten days after publication in the official newspaper of 132.4a council resolution determining to issue them; and if before the end of that time, a 132.5petition asking for an election on the proposition signed by voters equal to ten percent 132.6of the number of voters at the last regular municipal election is filed with the clerk, such 132.7certificates or notes shall not be issued until the proposition of their issuance has been 132.8approved by a majority of the votes cast on the question at a regular or special election.132.9    (f) A tax levy shall be made for the payment of the principal and interest on such 132.10certificates or notes, in accordance with section 
         475.61, as in the case of bonds.132.11    Sec. 66. Minnesota Statutes 2010, section 428A.02, subdivision 1, is amended to read:132.12    Subdivision 1. Ordinance. The governing body of a city may adopt an ordinance 132.13establishing a special service district. Only property that is classified under section 
         273.13132.14and used for commercial, industrial, or public utility purposes, or is vacant land zoned or 132.15designated on a land use plan for commercial or industrial use and located in the special 132.16service district, may be subject to the charges imposed by the city on the special service 132.17district. Other types of property may be included within the boundaries of the special 132.18service district but are not subject to the levies or charges imposed by the city on the 132.19special service district. If 50 percent or more of the estimated market value of a parcel of 132.20property is classified under section 
         273.13 as commercial, industrial, or vacant land zoned 132.21or designated on a land use plan for commercial or industrial use, or public utility for the 132.22current assessment year, then the entire taxable market value of the property is subject to a 132.23service charge based on net tax capacity for purposes of sections 
         428A.01 to 
         428A.10. 132.24The ordinance shall describe with particularity the area within the city to be included in 132.25the district and the special services to be furnished in the district. The ordinance may not 132.26be adopted until after a public hearing has been held on the question. Notice of the hearing 132.27shall include the time and place of hearing, a map showing the boundaries of the proposed 132.28district, and a statement that all persons owning property in the proposed district that 132.29would be subject to a service charge will be given opportunity to be heard at the hearing. 132.30Within 30 days after adoption of the ordinance under this subdivision, the governing body 132.31shall send a copy of the ordinance to the commissioner of revenue.132.32    Sec. 67. Minnesota Statutes 2010, section 430.102, subdivision 2, is amended to read:132.33    Subd. 2. Council approval; special tax levy limitation. The council shall receive 132.34and consider the estimate required in subdivision 1 and the items of cost after notice and 133.1hearing before it or its appropriate committee as it considers necessary or expedient, 133.2and shall approve the estimate, with necessary amendments. The amounts of each item 133.3of cost estimated are then appropriated to operate, maintain, and improve the pedestrian 133.4mall during the next fiscal year. The amount of the special tax to be charged under 133.5subdivision 1, clause (3), must not, however, exceed 0.12089 percent of estimated market 133.6value of taxable property in the district. The council shall make any necessary adjustment 133.7in costs of operating and maintaining the district to keep the amount of the tax within 133.8this limitation.133.9    Sec. 68. Minnesota Statutes 2010, section 447.10, is amended to read:133.10447.10 TAX LEVY FOR OPERATING AND MAINTAINING HOSPITAL.133.11The governing body of a city of the first class owning a hospital may annually levy 133.12a tax to operate and maintain the hospital. The tax must not exceed 0.00806 percent of 133.13taxable estimated market value.133.14    Sec. 69. Minnesota Statutes 2010, section 450.19, is amended to read:133.15450.19 TOURIST CAMPING GROUNDS.133.16A home rule charter or statutory city or town may establish and maintain public 133.17tourist camping grounds. The governing body thereof may acquire by lease, purchase, or 133.18gift, suitable lands located either within or without the corporate limits for use as public 133.19tourist camping grounds and provide for the equipment, operation, and maintenance 133.20of the same. The amount that may be expended for the maintenance, improvement, or 133.21operation of tourist camping grounds shall not exceed, in any year, a sum equal to 0.00806 133.22percent of taxable estimated market value.133.23    Sec. 70. Minnesota Statutes 2010, section 450.25, is amended to read:133.24450.25 MUSEUM, GALLERY, OR SCHOOL OF ARTS OR CRAFTS; TAX 133.25LEVY.133.26After the acquisition of any museum, gallery, or school of arts or crafts, the board 133.27of park commissioners of the city in which it is located shall cause to be included in the 133.28annual tax levy upon all the taxable property of the county in which the museum, gallery, 133.29or school of arts or crafts is located, a tax of 0.00846 percent of estimated market value. 133.30The board shall certify the levy to the county auditor and it shall be added to, and collected 133.31with and as part of, the general, real, and personal property taxes, with like penalties and 133.32interest, in case of nonpayment and default, and all provisions of law in respect to the 134.1levy, collection, and enforcement of other taxes shall, so far as applicable, be followed in 134.2respect of these taxes. All of these taxes, penalties, and interest, when collected, shall be 134.3paid to the city treasurer of the city in which is located the museum, gallery, or school 134.4of arts or crafts and credited to a fund to be known as the park museum fund, and shall 134.5be used only for the purposes specified in sections 
         450.23 to 
         450.25. Any part of the 134.6proceeds of the levy not expended for the purposes specified in section 
         450.24 may be 134.7used for the erection of new buildings for the same purposes.134.8    Sec. 71. Minnesota Statutes 2010, section 458A.10, is amended to read:134.9458A.10 PROPERTY TAX.134.10The commission shall annually levy a tax not to exceed 0.12089 percent of estimated 134.11market value on all the taxable property in the transit area at a rate sufficient to produce 134.12an amount necessary for the purposes of sections 
         458A.01 to 
         458A.15, other than the 134.13payment of principal and interest due on any revenue bonds issued pursuant to section 134.14458A.05
         . Property taxes levied under this section shall be certified by the commission to 134.15the county auditors of the transit area, extended, assessed, and collected in the manner 134.16provided by law for the property taxes levied by the governing bodies of cities. The 134.17proceeds of the taxes levied under this section shall be remitted by the respective county 134.18treasurers to the treasurer of the commission, who shall credit the same to the funds of 134.19the commission for use for the purposes of sections 
         458A.01 to 
         458A.15 subject to any 134.20applicable pledges or limitations on account of tax anticipation certificates or other 134.21specific purposes. At any time after making a tax levy under this section and certifying 134.22it to the county auditors, the commission may issue general obligation certificates of 134.23indebtedness in anticipation of the collection of the taxes as provided by section 
         412.261.134.24    Sec. 72. Minnesota Statutes 2010, section 458A.31, subdivision 1, is amended to read:134.25    Subdivision 1. Levy limit. Notwithstanding anything to the contrary contained in 134.26the charter of the city of Duluth, any ordinance thereof, or any statute applicable thereto, 134.27limiting the amount levied in any one year for general or special purposes, the city council 134.28of the city of Duluth shall each year levy a tax in an amount not to exceed 0.07253 134.29percent of taxable estimated market value, by ordinance. An ordinance fixing the levy 134.30shall take effect immediately upon its passage and approval. The proceeds of the levy 134.31shall be paid into the city treasury and deposited in the operating fund provided for in 134.32section 
         458A.24, subdivision 3.134.33    Sec. 73. Minnesota Statutes 2010, section 465.04, is amended to read:135.1465.04 ACCEPTANCE OF GIFTS.135.2Cities of the second, third, or fourth class, having at any time a an estimated135.3market value of not more than $41,000,000, exclusive of money and credits, as officially 135.4equalized by the commissioner of revenue, either under home rule charter or under the 135.5laws of this state, in addition to all other powers possessed by them, hereby are authorized 135.6and empowered to receive and accept gifts and donations for the use and benefit of 135.7such cities and the inhabitants thereof upon terms and conditions to be approved by the 135.8governing bodies of such cities; and such cities are authorized to comply with and perform 135.9such terms and conditions, which may include payment to the donor or donors of interest 135.10on the value of the gift at not exceeding five percent per annum payable annually or 135.11semiannually, during the remainder of the natural life or lives of such donor or donors.135.12    Sec. 74. Minnesota Statutes 2010, section 469.033, subdivision 6, is amended to read:135.13    Subd. 6. Operation area as taxing district, special tax. All of the territory 135.14included within the area of operation of any authority shall constitute a taxing district for 135.15the purpose of levying and collecting special benefit taxes as provided in this subdivision. 135.16All of the taxable property, both real and personal, within that taxing district shall be 135.17deemed to be benefited by projects to the extent of the special taxes levied under this 135.18subdivision. Subject to the consent by resolution of the governing body of the city in and 135.19for which it was created, an authority may levy a tax upon all taxable property within that 135.20taxing district. The tax shall be extended, spread, and included with and as a part of 135.21the general taxes for state, county, and municipal purposes by the county auditor, to be 135.22collected and enforced therewith, together with the penalty, interest, and costs. As the tax, 135.23including any penalties, interest, and costs, is collected by the county treasurer it shall be 135.24accumulated and kept in a separate fund to be known as the "housing and redevelopment 135.25project fund." The money in the fund shall be turned over to the authority at the same time 135.26and in the same manner that the tax collections for the city are turned over to the city, and 135.27shall be expended only for the purposes of sections 
         469.001 to 
         469.047. It shall be paid 135.28out upon vouchers signed by the chair of the authority or an authorized representative. 135.29The amount of the levy shall be an amount approved by the governing body of the city, but 135.30shall not exceed 0.0185 percent of taxable estimated  market value. The authority shall 135.31each year formulate and file a budget in accordance with the budget procedure of the city 135.32in the same manner as required of executive departments of the city or, if no budgets are 135.33required to be filed, by August 1. The amount of the tax levy for the following year shall 135.34be based on that budget.136.1    Sec. 75. Minnesota Statutes 2010, section 469.034, subdivision 2, is amended to read:136.2    Subd. 2. General obligation revenue bonds. (a) An authority may pledge the 136.3general obligation of the general jurisdiction governmental unit as additional security for 136.4bonds payable from income or revenues of the project or the authority. The authority 136.5must find that the pledged revenues will equal or exceed 110 percent of the principal and 136.6interest due on the bonds for each year. The proceeds of the bonds must be used for a 136.7qualified housing development project or projects. The obligations must be issued and 136.8sold in the manner and following the procedures provided by chapter 475, except the 136.9obligations are not subject to approval by the electors, and the maturities may extend to 136.10not more than 35 years for obligations sold to finance housing for the elderly and 40 years 136.11for other obligations issued under this subdivision. The authority is the municipality for 136.12purposes of chapter 475.136.13(b) The principal amount of the issue must be approved by the governing body of 136.14the general jurisdiction governmental unit whose general obligation is pledged. Public 136.15hearings must be held on issuance of the obligations by both the authority and the general 136.16jurisdiction governmental unit. The hearings must be held at least 15 days, but not more 136.17than 120 days, before the sale of the obligations.136.18(c) The maximum amount of general obligation bonds that may be issued and 136.19outstanding under this section equals the greater of (1) one-half of one percent of the 136.20taxable estimated market value of the general jurisdiction governmental unit whose 136.21general obligation is pledged, or (2) $3,000,000. In the case of county or multicounty 136.22general obligation bonds, the outstanding general obligation bonds of all cities in the 136.23county or counties issued under this subdivision must be added in calculating the limit 136.24under clause (1).136.25(d) "General jurisdiction governmental unit" means the city in which the housing 136.26development project is located. In the case of a county or multicounty authority, the 136.27county or counties may act as the general jurisdiction governmental unit. In the case of 136.28a multicounty authority, the pledge of the general obligation is a pledge of a tax on the 136.29taxable property in each of the counties.136.30(e) "Qualified housing development project" means a housing development project 136.31providing housing either for the elderly or for individuals and families with incomes not 136.32greater than 80 percent of the median family income as estimated by the United States 136.33Department of Housing and Urban Development for the standard metropolitan statistical 136.34area or the nonmetropolitan county in which the project is located. The project must be 136.35owned for the term of the bonds either by the authority or by a limited partnership or other 136.36entity in which the authority or another entity under the sole control of the authority is 137.1the sole general partner and the partnership or other entity must receive (1) an allocation 137.2from the Department of Management and Budget or an entitlement issuer of tax-exempt 137.3bonding authority for the project and a preliminary determination by the Minnesota 137.4Housing Finance Agency or the applicable suballocator of tax credits that the project 137.5will qualify for four percent low-income housing tax credits or (2) a reservation of nine 137.6percent low-income housing tax credits from the Minnesota Housing Finance Agency or a 137.7suballocator of tax credits for the project. A qualified housing development project may 137.8admit nonelderly individuals and families with higher incomes if:137.9(1) three years have passed since initial occupancy;137.10(2) the authority finds the project is experiencing unanticipated vacancies resulting in 137.11insufficient revenues, because of changes in population or other unforeseen circumstances 137.12that occurred after the initial finding of adequate revenues; and137.13(3) the authority finds a tax levy or payment from general assets of the general 137.14jurisdiction governmental unit will be necessary to pay debt service on the bonds if higher 137.15income individuals or families are not admitted.137.16(f) The authority may issue bonds to refund bonds issued under this subdivision in 137.17accordance with section 
         475.67. The finding of the adequacy of pledged revenues required 137.18by paragraph (a) and the public hearing required by paragraph (b) shall not apply to the 137.19issuance of refunding bonds. This paragraph applies to refunding bonds issued on and 137.20after July 1, 1992.137.21    Sec. 76. Minnesota Statutes 2010, section 469.053, subdivision 4, is amended to read:137.22    Subd. 4. Mandatory city levy. A city shall, at the request of the port authority, levy 137.23a tax in any year for the benefit of the port authority. The tax must not exceed 0.01813 137.24percent of taxable estimated market value. The amount levied must be paid by the city 137.25treasurer to the treasurer of the port authority, to be spent by the authority.137.26    Sec. 77. Minnesota Statutes 2010, section 469.053, subdivision 4a, is amended to read:137.27    Subd. 4a. Seaway port authority levy. A levy made under this subdivision shall 137.28replace the mandatory city levy under subdivision 4. A seaway port authority is a special 137.29taxing district under section 
         275.066 and may levy a tax in any year for the benefit of the 137.30seaway port authority. The tax must not exceed 0.01813 percent of taxable estimated137.31market value. The county auditor shall distribute the proceeds of the property tax levy to 137.32the seaway port authority.137.33    Sec. 78. Minnesota Statutes 2010, section 469.053, subdivision 6, is amended to read:138.1    Subd. 6. Discretionary city levy. Upon request of a port authority, the port 138.2authority's city may levy a tax to be spent by and for its port authority. The tax must 138.3enable the port authority to carry out efficiently and in the public interest sections 
         469.048138.4to 
         469.068 to create and develop industrial development districts. The levy must not be 138.5more than 0.00282 percent of taxable estimated market value. The county treasurer shall 138.6pay the proceeds of the tax to the port authority treasurer. The money may be spent by 138.7the authority in performance of its duties to create and develop industrial development 138.8districts. In spending the money the authority must judge what best serves the public 138.9interest. The levy in this subdivision is in addition to the levy in subdivision 4.138.10    Sec. 79. Minnesota Statutes 2010, section 469.107, subdivision 1, is amended to read:138.11    Subdivision 1. City tax levy. A city may, at the request of the authority, levy a tax in 138.12any year for the benefit of the authority. The tax must be not more than 0.01813 percent of 138.13taxable estimated market value. The amount levied must be paid by the city treasurer to 138.14the treasurer of the authority, to be spent by the authority.138.15    Sec. 80. Minnesota Statutes 2010, section 469.177, subdivision 1, is amended to read:138.16    Subdivision 1. Original net tax capacity. (a) Upon or after adoption of a tax 138.17increment financing plan, the auditor of any county in which the district is situated shall, 138.18upon request of the authority, certify the original net tax capacity of the tax increment 138.19financing district and that portion of the district overlying any subdistrict as described in 138.20the tax increment financing plan and shall certify in each year thereafter the amount by 138.21which the original net tax capacity has increased or decreased as a result of a change in tax 138.22exempt status of property within the district and any subdistrict, reduction or enlargement 138.23of the district or changes pursuant to subdivision 4. The auditor shall certify the amount 138.24within 30 days after receipt of the request and sufficient information to identify the parcels 138.25included in the district. The certification relates to the taxes payable year as provided in 138.26subdivision 6.138.27    (b) If the classification under section 
         273.13 of property located in a district changes 138.28to a classification that has a different assessment ratio, the original net tax capacity of that 138.29property must be redetermined at the time when its use is changed as if the property had 138.30originally been classified in the same class in which it is classified after its use is changed.138.31    (c) The amount to be added to the original net tax capacity of the district as a result 138.32of previously tax exempt real property within the district becoming taxable equals the net 138.33tax capacity of the real property as most recently assessed pursuant to section 
         273.18 or, if 138.34that assessment was made more than one year prior to the date of title transfer rendering 139.1the property taxable, the net tax capacity assessed by the assessor at the time of the 139.2transfer. If improvements are made to tax exempt property after the municipality approves 139.3the district and before the parcel becomes taxable, the assessor shall, at the request of 139.4the authority, separately assess the estimated market value of the improvements. If the 139.5property becomes taxable, the county auditor shall add to original net tax capacity, the net 139.6tax capacity of the parcel, excluding the separately assessed improvements. If substantial 139.7taxable improvements were made to a parcel after certification of the district and if the 139.8property later becomes tax exempt, in whole or part, as a result of the authority acquiring 139.9the property through foreclosure or exercise of remedies under a lease or other revenue 139.10agreement or as a result of tax forfeiture, the amount to be added to the original net tax 139.11capacity of the district as a result of the property again becoming taxable is the amount 139.12of the parcel's value that was included in original net tax capacity when the parcel was 139.13first certified. The amount to be added to the original net tax capacity of the district as a 139.14result of enlargements equals the net tax capacity of the added real property as most 139.15recently certified by the commissioner of revenue as of the date of modification of the tax 139.16increment financing plan pursuant to section 
         469.175, subdivision 4.139.17    (d) If the net tax capacity of a property increases because the property no longer 139.18qualifies under the Minnesota Agricultural Property Tax Law, section 
         273.111; the 139.19Minnesota Open Space Property Tax Law, section 
         273.112; or the Metropolitan 139.20Agricultural Preserves Act, chapter 473H, or because platted, unimproved property is 139.21improved or market value is increased after approval of the plat under section 
         273.11, 139.22subdivision 14, 14a, or 14b, the increase in net tax capacity must be added to the original 139.23net tax capacity. If the net tax capacity of a property increases because the property 139.24no longer qualifies for the homestead market value exclusion under section 273.13, 139.25subdivision 35, the increase in net tax capacity must be added to the original net tax 139.26capacity if the original construction of the affected home was completed before the date 139.27the assessor certified the original net tax capacity of the district.139.28    (e) The amount to be subtracted from the original net tax capacity of the district as a 139.29result of previously taxable real property within the district becoming tax exempt or 139.30qualifying in whole or part for an exclusion from taxable market value, or a reduction in 139.31the geographic area of the district, shall be the amount of original net tax capacity initially 139.32attributed to the property becoming tax exempt, being excluded from taxable market 139.33value, or being removed from the district. If the net tax capacity of property located within 139.34the tax increment financing district is reduced by reason of a court-ordered abatement, 139.35stipulation agreement, voluntary abatement made by the assessor or auditor or by order 139.36of the commissioner of revenue, the reduction shall be applied to the original net tax 140.1capacity of the district when the property upon which the abatement is made has not been 140.2improved since the date of certification of the district and to the captured net tax capacity 140.3of the district in each year thereafter when the abatement relates to improvements made 140.4after the date of certification. The county auditor may specify reasonable form and content 140.5of the request for certification of the authority and any modification thereof pursuant to 140.6section 
         469.175, subdivision 4.140.7    (f) If a parcel of property contained a substandard building or improvements 140.8described in section 
         469.174, subdivision 10, paragraph (e), that were demolished or 140.9removed and if the authority elects to treat the parcel as occupied by a substandard 140.10building under section 
         469.174, subdivision 10, paragraph (b), or by improvements under 140.11section 
         469.174, subdivision 10, paragraph (e), the auditor shall certify the original net tax 140.12capacity of the parcel using the greater of (1) the current net tax capacity of the parcel, or 140.13(2) the estimated market value of the parcel for the year in which the building or other 140.14improvements were demolished or removed, but applying the class rates for the current 140.15year.140.16    (g) For a redevelopment district qualifying under section 
         469.174, subdivision 10, 140.17paragraph (a), clause (4), as a qualified disaster area, the auditor shall certify the value of 140.18the land as the original tax capacity for any parcel in the district that contains a building 140.19that suffered substantial damage as a result of the disaster or emergency.140.20EFFECTIVE DATE.This section is effective the day following final enactment 140.21and applies to all districts, regardless of when the request for certification was made, and 140.22to computation of increment beginning with taxes payable in 2013, provided that the 140.23adjustments to original tax capacity required by this section apply only to exclusions 140.24that reduced taxable market value beginning with taxes payable in 2012 or thereafter, 140.25regardless of when the law authorizing the exclusion became effective.140.26    Sec. 81. Minnesota Statutes 2010, section 469.180, subdivision 2, is amended to read:140.27    Subd. 2. Tax levies. Notwithstanding any law, the county board of any county may 140.28appropriate from the general revenue fund a sum not to exceed a county levy of 0.00080 140.29percent of taxable estimated market value to carry out the purposes of this section.140.30    Sec. 82. Minnesota Statutes 2010, section 469.187, is amended to read:140.31469.187 FIRST CLASS CITY SPENDING FOR PUBLICITY; PUBLICITY 140.32BOARD.141.1Any city of the first class may expend money for city publicity purposes. The city 141.2may levy a tax, not exceeding 0.00080 percent of taxable estimated market value. The 141.3proceeds of the levy shall be expended in the manner and for the city publicity purposes 141.4the council directs. The council may establish and provide for a publicity board or bureau 141.5to administer the fund, subject to the conditions and limitations the council prescribes 141.6by ordinance.141.7    Sec. 83. Minnesota Statutes 2010, section 469.206, is amended to read:141.8469.206 HAZARDOUS PROPERTY PENALTY.141.9A city may assess a penalty up to one percent of the estimated market value of 141.10real property, including any building located within the city that the city determines to 141.11be hazardous as defined in section 
         463.15, subdivision 3. The city shall send a written 141.12notice to the address to which the property tax statement is sent at least 90 days before it 141.13may assess the penalty. If the owner of the property has not paid the penalty or fixed the 141.14property within 90 days after receiving notice of the penalty, the penalty is considered 141.15delinquent and is increased by 25 percent each 60 days the penalty is not paid and the 141.16property remains hazardous. For the purposes of this section, a penalty that is delinquent 141.17is considered a delinquent property tax and subject to chapters 279, 280, and 281, in the 141.18same manner as delinquent property taxes.141.19    Sec. 84. Minnesota Statutes 2010, section 471.24, is amended to read:141.20471.24 TOWNS, STATUTORY CITIES; JOINT MAINTENANCE OF 141.21CEMETERY.141.22Where a statutory city or town owns and maintains an established cemetery or burial 141.23ground, either within or without the municipal limits, the statutory city or town may, by 141.24mutual agreement with contiguous statutory cities and towns, each having a an estimated141.25market value of not less than $2,000,000, join together in the maintenance of such public 141.26cemetery or burial ground for the use of the inhabitants of each of such municipalities; and 141.27each such municipality is hereby authorized, by action of its council or governing body, 141.28to levy a tax or make an appropriation for the annual support and maintenance of such 141.29cemetery or burial ground; provided, the amount thus appropriated by each municipality 141.30shall not exceed a total of $10,000 in any one year.141.31    Sec. 85. Minnesota Statutes 2010, section 471.571, subdivision 1, is amended to read:141.32    Subdivision 1. Application. This section applies to each city in which the net tax 141.33capacity of real and personal property consists in part of iron ore or lands containing 142.1taconite or semitaconite and in which the total taxable estimated market value of real 142.2and personal property exceeds $2,500,000.142.3    Sec. 86. Minnesota Statutes 2010, section 471.571, subdivision 2, is amended to read:142.4    Subd. 2. Creation of fund, tax levy. The governing body of the city may create a 142.5permanent improvement and replacement fund to be maintained by an annual tax levy. 142.6The governing body may levy a tax in excess of any charter limitation for the support of 142.7the permanent improvement and replacement fund, but not exceeding the following:142.8(a) in cities having a population of not more than 500 inhabitants, the lesser of $20 142.9per capita or 0.08059 percent of taxable estimated market value;142.10(b) in cities having a population of more than 500 and less than 2500 2,500, the 142.11greater of $12.50 per capita or $10,000 but not exceeding 0.08059 percent of taxable142.12estimated market value;142.13(c) in cities having a population of more than 2500 2,500 or more inhabitants, 142.14the greater of $10 per capita or $31,500 but not exceeding 0.08059 percent of taxable142.15estimated market value.142.16    Sec. 87. Minnesota Statutes 2010, section 471.73, is amended to read:142.17471.73 ACCEPTANCE OF PROVISIONS.142.18In the case of any city within the class specified in section 471.72 having a an 142.19estimated  market value, as defined in section 471.72, in excess of $37,000,000; and in the 142.20case of any statutory city within such class having a an estimated market value, as defined 142.21in section 471.72, of less than $5,000,000; and in the case of any statutory city within such 142.22class which is governed by Laws 1933, chapter 211, or Laws 1937, chapter 356; and in 142.23the case of any statutory city within such class which is governed by Laws 1929, chapter 142.24208, and has a an estimated market value of less than $83,000,000; and in the case of 142.25any school district within such class having a an estimated market value, as defined in 142.26section 471.72, of more than $54,000,000; and in the case of all towns within said class; 142.27sections 
         471.71 to 
         471.83 apply only if the governing body of the city or statutory city, the 142.28board of the school district, or the town board of the town shall have adopted a resolution 142.29determining to issue bonds under the provisions of sections 
         471.71 to 
         471.83 or to go 142.30upon a cash basis in accordance with the provisions thereof.142.31    Sec. 88. Minnesota Statutes 2010, section 473.325, subdivision 2, is amended to read:142.32    Subd. 2. Chapter 475 applies; exceptions. The Metropolitan Council shall sell and 142.33issue the bonds in the manner provided in chapter 475, and shall have the same powers 143.1and duties as a municipality issuing bonds under that law, except that the approval of a 143.2majority of the electors shall not be required and the net debt limitations shall not apply. 143.3The terms of each series of bonds shall be fixed so that the amount of principal and interest 143.4on all outstanding and undischarged bonds, together with the bonds proposed to be issued, 143.5due in any year shall not exceed 0.01209 percent of estimated market value of all taxable 143.6property in the metropolitan area as last finally equalized prior to a proposed issue. The 143.7bonds shall be secured in accordance with section 
         475.61, subdivision 1, and any taxes 143.8required for their payment shall be levied by the council, shall not affect the amount or rate 143.9of taxes which may be levied by the council for other purposes, shall be spread against all 143.10taxable property in the metropolitan area and shall not be subject to limitation as to rate or 143.11amount. Any taxes certified by the council to the county auditors for collection shall be 143.12reduced by the amount received by the council from the commissioner of management and 143.13budget or the federal government for the purpose of paying the principal and interest on 143.14bonds to which the levy relates. The council shall certify the fact and amount of all money 143.15so received to the county auditors, and the auditors shall reduce the levies previously made 143.16for the bonds in the manner and to the extent provided in section 
         475.61, subdivision 3.143.17    Sec. 89. Minnesota Statutes 2010, section 473.629, is amended to read:143.18473.629 VALUE OF PROPERTY FOR BOND ISSUES BY SCHOOL 143.19DISTRICTS.143.20As to any lands to be detached from any school district under the provisions hereof143.21section 473.625, notwithstanding such prospective the detachment, the estimated market 143.22value of such the detached lands and the net tax capacity of taxable properties now located 143.23therein or thereon shall be and on the lands on the date of the detachment constitute 143.24from and after the date of the enactment hereof a part of the estimated market value of 143.25properties upon the basis of which such used to calculate the net debt limit of the school 143.26district may issue its bonds,. The value of such the lands for such purpose to beand other 143.27taxable properties for purposes of the school district's net debt limit are 33-1/3 percent of 143.28the estimated market value thereof as determined and certified by said the assessor to said143.29the school district, and it shall be the duty of such the assessor annually on or before the 143.30tenth day of October from and after the passage hereof, to so of each year, shall determine 143.31and certify that value; provided, however, that the value of such the detached lands and 143.32such taxable properties shall never exceed 20 percent of the estimated market value of 143.33all properties constituting and making up the basis aforesaid used to calculate the net 143.34debt limit of the school district.144.1    Sec. 90. Minnesota Statutes 2010, section 473.661, subdivision 3, is amended to read:144.2    Subd. 3. Levy limit. In any budget certified by the commissioners under this 144.3section, the amount included for operation and maintenance shall not exceed an amount 144.4which, when extended against the property taxable therefor under section 
         473.621, 144.5subdivision 5
         , will require a levy at a rate of 0.00806 percent of estimated market value. 144.6Taxes levied by the corporation shall not affect the amount or rate of taxes which may 144.7be levied by any other local government unit within the metropolitan area under the 144.8provisions of any charter.144.9    Sec. 91. Minnesota Statutes 2010, section 473.667, subdivision 9, is amended to read:144.10    Subd. 9. Additional taxes. Nothing herein shall prevent the commission from 144.11levying a tax not to exceed 0.00121 percent of estimated market value on taxable property 144.12within its taxing jurisdiction, in addition to any levies found necessary for the debt 144.13service fund authorized by section 
         473.671. Nothing herein shall prevent the levy and 144.14appropriation for purposes of the commission of any other tax on property or on any 144.15income, transaction, or privilege, when and if authorized by law. All collections of any 144.16taxes so levied shall be included in the revenues appropriated for the purposes referred 144.17to in this section, unless otherwise provided in the law authorizing the levies; but no 144.18covenant as to the continuance or as to the rate and amount of any such levy shall be made 144.19with the holders of the commission's bonds unless specifically authorized by law.144.20    Sec. 92. Minnesota Statutes 2010, section 473.671, is amended to read:144.21473.671 LIMIT OF TAX LEVY.144.22The taxes levied against the property of the metropolitan area in any one year shall 144.23not exceed 0.00806 percent of taxable estimated market value, exclusive of taxes levied 144.24to pay the principal or interest on any bonds or indebtedness of the city issued under 144.25Laws 1943, chapter 500, and exclusive of any taxes levied to pay the share of the city for 144.26payments on bonded indebtedness of the corporation provided for in Laws 1943, chapter 144.27500. The levy of taxes authorized in Laws 1943, chapter 500, shall be in addition to the 144.28maximum rate allowed to be levied to defray the cost of government under the provisions 144.29of the charter of any city affected by Laws 1943, chapter 500.144.30    Sec. 93. Minnesota Statutes 2010, section 473.711, subdivision 2a, is amended to read:144.31    Subd. 2a. Tax levy. (a) The commission may levy a tax on all taxable property in 144.32the district as defined in section 
         473.702 to provide funds for the purposes of sections 144.33473.701
          to 
         473.716. The tax shall not exceed the property tax levy limitation determined 145.1in this subdivision. A participating county may agree to levy an additional tax to be used 145.2by the commission for the purposes of sections 
         473.701 to 
         473.716 but the sum of the 145.3county's and commission's taxes may not exceed the county's proportionate share of 145.4the property tax levy limitation determined under this subdivision based on the ratio of 145.5its total net tax capacity to the total net tax capacity of the entire district as adjusted by 145.6section 
         270.12, subdivision 3. The auditor of each county in the district shall add the 145.7amount of the levy made by the district to other taxes of the county for collection by 145.8the county treasurer with other taxes. When collected, the county treasurer shall make 145.9settlement of the tax with the district in the same manner as other taxes are distributed 145.10to political subdivisions. No county shall levy any tax for mosquito, disease vectoring 145.11tick, and black gnat (Simuliidae) control except under this section. The levy shall be in 145.12addition to other taxes authorized by law.145.13(b) The property tax levied by the Metropolitan Mosquito Control Commission shall 145.14not exceed the product of (i) the commission's property tax levy limitation for the previous 145.15year determined under this subdivision multiplied by (ii) an index for market valuation 145.16changes equal to the total estimated market valuation value of all taxable property for the 145.17current tax payable year located within the district plus any area that has been added to the 145.18district since the previous year, divided by the total estimated market valuation value of all 145.19taxable property located within the district for the previous taxes payable year.145.20(c) For the purpose of determining the commission's property tax levy limitation 145.21under this subdivision, "total market valuation" means the total market valuation of all 145.22taxable property within the district without valuation adjustments for fiscal disparities 145.23(chapter 473F), tax increment financing (sections 469.174 to 469.179), and high voltage 145.24transmission lines (section 273.425).145.25    Sec. 94. Minnesota Statutes 2010, section 473F.02, subdivision 12, is amended to read:145.26    Subd. 12. Adjusted market value. "Adjusted market value" of real and personal 145.27property within a municipality means the assessor's estimated taxable market value, 145.28as defined in section 272.03, of all real and personal property, including the value of 145.29manufactured housing, within the municipality, adjusted for sales ratios in a manner 145.30similar to the adjustments made to city and town net tax capacities . For purposes 145.31of sections 473F.01 to 473F.13, the commissioner of revenue shall annually make 145.32determinations and reports with respect to each municipality which are comparable to 145.33those it makes for school districts under section 
         127A.48, subdivisions 1 to 6, in the same 145.34manner and at the same times as are prescribed by the subdivisions. The commissioner 145.35of revenue shall annually determine, for each municipality, information comparable to 146.1that required by section 475.53, subdivision 4, for school districts, as soon as practicable 146.2after it becomes available. The commissioner of revenue shall then compute the equalized 146.3market value of property within each municipality using the aggregate sales ratios from 146.4the Department of Revenue's sales ratio study.146.5    Sec. 95. Minnesota Statutes 2010, section 473F.02, subdivision 14, is amended to read:146.6    Subd. 14. Fiscal capacity. "Fiscal capacity" of a municipality means its valuation146.7adjusted market value, determined as of January 2 of any year, divided by its population, 146.8determined as of a date in the same year.146.9    Sec. 96. Minnesota Statutes 2010, section 473F.02, subdivision 15, is amended to read:146.10    Subd. 15. Average fiscal capacity. "Average fiscal capacity" of municipalities 146.11means the sum of the valuations adjusted market values of all municipalities, determined 146.12as of January 2 of any year, divided by the sum of their populations, determined as of 146.13a date in the same year.146.14    Sec. 97. Minnesota Statutes 2010, section 473F.02, subdivision 23, is amended to read:146.15    Subd. 23. Net tax capacity. "Net tax capacity" means the taxable market value of 146.16real and personal property multiplied by its net tax capacity rates in section 
         273.13.146.17    Sec. 98. Minnesota Statutes 2010, section 475.521, subdivision 4, is amended to read:146.18    Subd. 4. Limitations on amount. A municipality may not issue bonds under this 146.19section if the maximum amount of principal and interest to become due in any year on 146.20all the outstanding bonds issued under this section, including the bonds to be issued, 146.21will equal or exceed 0.16 percent of the taxable estimated market value of property 146.22in the municipality. Calculation of the limit must be made using the taxable estimated146.23market value for the taxes payable year in which the obligations are issued and sold. In 146.24the case of a municipality with a population of 2,500 or more, the bonds are subject to 146.25the net debt limits under section 
         475.53. In the case of a shared facility in which more 146.26than one municipality participates, upon compliance by each participating municipality 146.27with the requirements of subdivision 2, the limitations in this subdivision and the net debt 146.28represented by the bonds shall be allocated to each participating municipality in proportion 146.29to its required financial contribution to the financing of the shared facility, as set forth in 146.30the joint powers agreement relating to the shared facility. This section does not limit the 146.31authority to issue bonds under any other special or general law.147.1    Sec. 99. Minnesota Statutes 2010, section 475.53, subdivision 1, is amended to read:147.2    Subdivision 1. Generally. Except as otherwise provided in sections 
         475.51 to 147.3475.74
         , no municipality, except a school district or a city of the first class, shall incur or be 147.4subject to a net debt in excess of three percent of the estimated market value of taxable 147.5property in the municipality.147.6    Sec. 100. Minnesota Statutes 2010, section 475.53, subdivision 3, is amended to read:147.7    Subd. 3. Cities first class. Unless its charter permits a greater net debt a city of 147.8the first class may not incur a net debt in excess of two percent of the estimated market 147.9value of all taxable property therein. If the charter of the city permits a net debt of the city 147.10in excess of two percent of its valuation, it may not incur a net debt in excess of 3-2/3 147.11percent of the estimated market value of the taxable property therein.147.12The county auditor, at the time of preparing the tax list of the city, shall compile a 147.13statement setting forth the total net tax capacity and the total estimated market value of 147.14each class of taxable property in such city for such year.147.15    Sec. 101. Minnesota Statutes 2010, section 475.53, subdivision 4, is amended to read:147.16    Subd. 4. School districts. Except as otherwise provided by law, no school district 147.17shall be subject to a net debt in excess of 15 percent of the actual estimated  market value 147.18of all taxable property situated within its corporate limits, as computed in accordance with 147.19this subdivision. The county auditor of each county containing taxable real or personal 147.20property situated within any school district shall certify to the district upon request the 147.21estimated market value of all such property. Whenever the commissioner of revenue, in 147.22accordance with section 
         127A.48, subdivisions 1 to 6, has determined that the net tax 147.23capacity of any district furnished by county auditors is not based upon theadjusted market 147.24value of taxable property in the district exceeds the estimated market value of property 147.25within the district, the commissioner of revenue shall certify to the district upon request 147.26the ratio most recently ascertained to exist between such the estimated market  value and 147.27the actual adjusted market value of property within the district., and the actual market 147.28value of property within a district, on which its debt limit under this subdivision is will 147.29be  based, is (a) the value certified by the county auditors, or (b) this on the estimated 147.30market value divided by the ratio certified by the commissioner of revenue, whichever 147.31results in a higher value.147.32    Sec. 102. Minnesota Statutes 2010, section 475.58, subdivision 2, is amended to read:148.1    Subd. 2. Funding, refunding. Any county, city, town, or school district whose 148.2outstanding gross debt, including all items referred to in section 
         475.51, subdivision 148.34
         , exceed in amount 1.62 percent of its estimated market value may issue bonds under 148.4this subdivision for the purpose of funding or refunding such indebtedness or any part 148.5thereof. A list of the items of indebtedness to be funded or refunded shall be made by the 148.6recording officer and treasurer and filed in the office of the recording officer. The initial 148.7resolution of the governing body shall refer to this subdivision as authority for the issue, 148.8state the amount of bonds to be issued and refer to the list of indebtedness to be funded or 148.9refunded. This resolution shall be published once each week for two successive weeks 148.10in a legal newspaper published in the municipality or if there be no such newspaper, in 148.11a legal newspaper published in the county seat. Such bonds may be issued without the 148.12submission of the question of their issue to the electors unless within ten days after the 148.13second publication of the resolution a petition requesting such election signed by ten or 148.14more voters who are taxpayers of the municipality, shall be filed with the recording officer. 148.15In event such petition is filed, no bonds shall be issued hereunder unless authorized by a 148.16majority of the electors voting on the question.148.17    Sec. 103. Minnesota Statutes 2010, section 475.73, subdivision 1, is amended to read:148.18    Subdivision 1. May purchase these bonds; conditions. Obligations sold under the 148.19provisions of section 
         475.60 may be purchased by the State Board of Investment if the 148.20obligations meet the requirements of section 
         11A.24, subdivision 2, upon the approval of 148.21the attorney general as to form and execution of the application therefor, and under rules 148.22as the board may specify, and the state board shall have authority to purchase the same 148.23to an amount not exceeding 
         3.63 percent of the estimated market value of the taxable 148.24property of the municipality, according to the last preceding assessment. The obligations 148.25shall not run for a shorter period than one year, nor for a longer period than 30 years and 148.26shall bear interest at a rate to be fixed by the state board but not less than two percent per 148.27annum. Forthwith upon the delivery to the state of Minnesota of any obligations issued by 148.28virtue thereof, the commissioner of management and budget shall certify to the respective 148.29auditors of the various counties wherein are situated the municipalities issuing the same, 148.30the number, denomination, amount, rate of interest and date of maturity of each obligation.148.31    Sec. 104. Minnesota Statutes 2011 Supplement, section 477A.011, subdivision 20, 148.32is amended to read:148.33    Subd. 20. City net tax capacity. "City net tax capacity" means (1) the net tax 148.34capacity computed using the net tax capacity rates in section 273.13 for taxes payable 149.1in the year of the aid distribution, and the market values, after the exclusion in section 149.2273.13, subdivision 35, for taxes payable in the year prior to the aid distribution plus (2) 149.3a city's fiscal disparities distribution tax capacity under section 276A.06, subdivision 2, 149.4paragraph (b), or 473F.08, subdivision 2, paragraph (b), for taxes payable in the year prior 149.5to that for which aids are being calculated. The market value utilized in computing city 149.6net tax capacity shall be reduced by the sum of (1) a city's market value of commercial 149.7industrial property as defined in section 276A.01, subdivision 3, or 473F.02, subdivision 3, 149.8multiplied by the ratio determined pursuant to section 276A.06, subdivision 2, paragraph 149.9(a), or 473F.08, subdivision 2, paragraph (a), (2) the market value of the captured value 149.10of tax increment financing districts as defined in section 469.177, subdivision 2, and (3) 149.11the market value of transmission lines deducted from a city's total net tax capacity under 149.12section 273.425. The city net tax capacity will be computed using equalized market values149.13the city's adjusted net tax capacity under section 273.1325.149.14EFFECTIVE DATE.This section is effective the day following final enactment.149.15    Sec. 105. Minnesota Statutes 2010, section 477A.011, subdivision 32, is amended to 149.16read:149.17    Subd. 32. Commercial industrial percentage. "Commercial industrial percentage" 149.18for a city is 100 times the sum of the estimated market values of all real property in the 149.19city classified as class 3 under section 
         273.13, subdivision 24, excluding public utility 149.20property, to the total estimated market value of all taxable real and personal property in 149.21the city. The estimated market values are the amounts computed before any adjustments 149.22for fiscal disparities under section 
         276A.06 or 
         473F.08. The estimated market values 149.23used for this subdivision are not equalized.149.24EFFECTIVE DATE.This section is effective for aids payable in 2014 and 149.25thereafter.149.26    Sec. 106. Minnesota Statutes 2010, section 477A.0124, subdivision 2, is amended to 149.27read:149.28    Subd. 2. Definitions. (a) For the purposes of this section, the following terms 149.29have the meanings given them.149.30(b) "County program aid" means the sum of "county need aid," "county tax base 149.31equalization aid," and "county transition aid."149.32(c) "Age-adjusted population" means a county's population multiplied by the county 149.33age index.150.1(d) "County age index" means the percentage of the population over age 65 within 150.2the county divided by the percentage of the population over age 65 within the state, except 150.3that the age index for any county may not be greater than 1.8 nor less than 0.8.150.4(e) "Population over age 65" means the population over age 65 established as of 150.5July 15 in an aid calculation year by the most recent federal census, by a special census 150.6conducted under contract with the United States Bureau of the Census, by a population 150.7estimate made by the Metropolitan Council, or by a population estimate of the state 150.8demographer made pursuant to section 
         4A.02, whichever is the most recent as to the stated 150.9date of the count or estimate for the preceding calendar year and which has been certified 150.10to the commissioner of revenue on or before July 15 of the aid calculation year. A revision 150.11to an estimate or count is effective for these purposes only if certified to the commissioner 150.12on or before July 15 of the aid calculation year. Clerical errors in the certification or use of 150.13estimates and counts established as of July 15 in the aid calculation year are subject to 150.14correction within the time periods allowed under section 
         477A.014.150.15(f) "Part I crimes" means the three-year average annual number of Part I crimes 150.16reported for each county by the Department of Public Safety for the most recent years 150.17available. By July 1 of each year, the commissioner of public safety shall certify to the 150.18commissioner of revenue the number of Part I crimes reported for each county for the 150.19three most recent calendar years available.150.20(g) "Households receiving food stamps" means the average monthly number of 150.21households receiving food stamps for the three most recent years for which data is 150.22available. By July 1 of each year, the commissioner of human services must certify to the 150.23commissioner of revenue the average monthly number of households in the state and in 150.24each county that receive food stamps, for the three most recent calendar years available.150.25(h) "County net tax capacity" means the net tax capacity of the county, computed 150.26analogously to city net tax capacity under section 477A.011, subdivision 20 county's 150.27adjusted net tax capacity under section 273.1325.150.28EFFECTIVE DATE.This section is effective the day following final enactment.150.29    Sec. 107. Minnesota Statutes 2010, section 641.23, is amended to read:150.30641.23 FUNDS; HOW PROVIDED.150.31Before any contract is made for the erection of a county jail, sheriff's residence, or 150.32both, the county board shall either levy a sufficient tax to provide the necessary funds, or 150.33issue county bonds therefor in accordance with the provisions of chapter 475, provided 150.34that no election is required if the amount of all bonds issued for this purpose and interest 151.1on them which are due and payable in any year does not exceed an amount equal to 151.20.09671 percent of estimated market value of taxable property within the county, as last 151.3determined before the bonds are issued.151.4    Sec. 108. Minnesota Statutes 2010, section 641.24, is amended to read:151.5641.24 LEASING.151.6The county may, by resolution of the county board, enter into a lease agreement with 151.7any statutory or home rule charter city situated within the county, or a county housing and 151.8redevelopment authority established pursuant to chapter 469 or any special law whereby 151.9the city or county housing and redevelopment authority will construct a jail or other law 151.10enforcement facilities for the county sheriff, deputy sheriffs, and other employees of the 151.11sheriff and other law enforcement agencies, in accordance with plans prepared by or at 151.12the request of the county board and, when required, approved by the commissioner of 151.13corrections and will finance it by the issuance of revenue bonds, and the county may lease 151.14the site and improvements for a term and upon rentals sufficient to produce revenue for the 151.15prompt payment of the bonds and all interest accruing thereon and, upon completion of 151.16payment, will acquire title thereto. The real and personal property acquired for the jail 151.17shall constitute a project and the lease agreement shall constitute a revenue agreement 151.18as contemplated in chapter 469, and all proceedings shall be taken by the city or county 151.19housing and redevelopment authority and the county in the manner and with the force and 151.20effect provided in chapter 469; provided that:151.21(1) no tax shall be imposed upon or in lieu of a tax upon the property;151.22(2) the approval of the project by the commissioner of commerce shall not be 151.23required;151.24(3) the Department of Corrections shall be furnished and shall record such 151.25information concerning each project as it may prescribe;151.26(4) the rentals required to be paid under the lease agreement shall not exceed in any 151.27year one-tenth of one percent of the estimated market value of property within the county, 151.28as last finally equalized before the execution of the agreement;151.29(5) the county board shall provide for the payment of all rentals due during the term 151.30of the lease, in the manner required in section 
         641.264, subdivision 2;151.31(6) no mortgage on the property shall be granted for the security of the bonds, but 151.32compliance with clause (5) hereof may be enforced as a nondiscretionary duty of the 151.33county board; and151.34(7) the county board may sublease any part of the jail property for purposes consistent 151.35with the maintenance and operation of a county jail or other law enforcement facility.152.1    Sec. 109. Minnesota Statutes 2010, section 645.44, is amended by adding a subdivision 152.2to read:152.3    Subd. 20.Estimated market value.When used in determining or calculating a 152.4limit on taxation, spending, state aid amounts, or debt, bond, certificate of indebtedness, or 152.5capital note issuance by or for a local government unit, "estimated market value" has the 152.6meaning given in section 273.032. 152.7    Sec. 110. REVISOR'S INSTRUCTION.152.8The revisor of statutes shall recodify Minnesota Statutes, section 127A.48, 152.9subdivisions 1 to 6, as section 273.1325, subdivisions 1 to 6, and change all 152.10cross-references to the affected subdivisions accordingly.152.11EFFECTIVE DATE.This section is effective the day following final enactment.152.12    Sec. 111.  REPEALER.152.13Minnesota Statutes 2010, sections 273.11, subdivision 1a; 276A.01, subdivision 152.1411; 276A.06, subdivision 10; 473F.02, subdivision 13; 473F.08, subdivision 10; and 152.15477A.011, subdivision 21, are repealed.152.16    Sec. 112. EFFECTIVE DATE.152.17Unless otherwise specifically provided, this article is effective the day following 152.18final enactment for purposes of limits on net debt, the issuance of bonds, certificates of 152.19indebtedness, and capital notes and is effective beginning for taxes payable in 2013 for 152.20all other purposes.152.21ARTICLE 8152.22MISCELLANEOUS TAXES152.23    Section 1. [136A.129] GREATER MINNESOTA INTERNSHIP PROGRAM.152.24    Subdivision 1.Definitions.(a) For the purposes of this section, the terms defined in 152.25this subdivision have the meanings given them.152.26(b) "Eligible employer" means a taxpayer under section 290.01 with employees 152.27located in greater Minnesota.152.28(c) "Eligible institution" means a Minnesota public postsecondary institution, or a 152.29Minnesota private, nonprofit, baccalaureate degree granting college or university.152.30(d) "Eligible student" means a student enrolled in an eligible institution who is a 152.31junior or senior in a degree program or has completed one-half of the credits necessary for 152.32an associate degree or certification.153.1(e) "Greater Minnesota" means the area located outside of the metropolitan area, as 153.2defined in section 473.121, subdivision 2.153.3(f) "Office" means the Office of Higher Education.153.4    Subd. 2.Program established.The office, in cooperation with the Department of 153.5Employment and Economic Development, shall administer a greater Minnesota internship 153.6grant program for eligible employers who hire interns in greater Minnesota through 153.7eligible institutions that provide academic credit. The purpose of the program is to 153.8encourage Minnesota businesses to:153.9(1) employ and provide valuable experience to Minnesota students; and153.10(2) foster long-term relationships between the students and greater Minnesota 153.11employers.153.12    Subd. 3.Program components.(a) An intern must be an eligible student who 153.13has been admitted to a major program that is closely related to the intern experience 153.14as determined by the eligible institution.153.15(b) To participate in the program, an eligible institution must:153.16(1) enter into written agreements with eligible employers to provide paid internships 153.17that are at least 12 weeks long and located in greater Minnesota;153.18(2) determine that the work experience of the internship is closely related to the 153.19eligible student's course of study; and153.20(3) provide academic credit for the successful completion of the internship or 153.21ensure that it fulfills requirements necessary to complete a vocational technical education 153.22program.153.23(c) To participate in the program, an eligible employer must enter into a written 153.24agreement with an eligible institution specifying that the intern:153.25(1) would not have been hired without the grant described in subdivision 4;153.26(2) did not work for the employer prior to entering the agreement;153.27(3) does not replace an existing employee;153.28(4) has not previously participated in the program;153.29(5) will be employed at a location in greater Minnesota;153.30(6) will be paid at least minimum wage for a minimum of 16 hours per week for at 153.31least a 12-week period; and153.32(7) will be supervised and evaluated by the employer.153.33(d) Participating eligible institutions and eligible employers must report annually to 153.34the office. The report must include at least the following:153.35(1) the number of interns hired;153.36(2) the number of hours and weeks worked by interns; and154.1(3) the compensation paid to interns.154.2(e) An internship with clinical experience currently required for completion of 154.3an academic program does not qualify for the greater Minnesota internship program 154.4under this section.154.5    Subd. 4.Employer grants for internships; maximum limits.(a) A grant for an 154.6eligible employer equals 40 percent of the compensation paid to each qualifying intern, 154.7not to exceed $1,250. An employer may receive a grant for a maximum of five interns 154.8in any fiscal year.154.9(b) The total amount of grants authorized under this section is limited to $1,250,000 154.10per fiscal year less administrative expense as provided in law. The office shall allocate 154.11grants to eligible institutions for participating employers and certify to the Department of 154.12Employment and Economic Development the amount of the grant.154.13    Subd. 5.Allocations to institutions.The office shall allocate employer grants 154.14authorized in subdivision 4 to eligible institutions. The office shall determine relevant 154.15criteria to allocate the grants, including the geographic distribution of grants to work 154.16locations outside the metropolitan area. Any grant amount allocated to an institution but 154.17not used may be reallocated to other eligible institutions. The office shall allocate a portion 154.18of any administrative fee to participating eligible institutions for their administrative costs.154.19    Subd. 6.Reports to the legislature.(a) By February 1, 2013, the office and the 154.20Department of Employment and Economic Development shall report to the legislature on 154.21the greater Minnesota internship program. The report must include at least the following:154.22(1) the number and dollar amount of grants allocated to employers;154.23(2) the number of interns employed under the program; and154.24(3) the cost of administering the program.154.25(b) By February 1, 2014, the office and the Department of Employment and 154.26Economic Development shall report to the legislature with an analysis of the effectiveness 154.27of the program in stimulating businesses to hire interns and in assisting participating 154.28interns in finding permanent career positions. The report must include the number of 154.29students who participated in the program who were subsequently employed full-time by 154.30the employer.154.31EFFECTIVE DATE.This section is effective July 1, 2012.154.32    Sec. 2. Minnesota Statutes 2010, section 297A.8155, is amended to read:154.33297A.8155 LIQUOR REPORTING REQUIREMENTS; PENALTY.155.1    A person who sells liquor, as defined in section 
         295.75, subdivision 1, in Minnesota 155.2to a retailer that sells liquor, shall file with the commissioner an annual informational 155.3report, in the form and manner prescribed by the commissioner, indicating the name, 155.4address, and Minnesota business identification number of each retailer, and the total 155.5dollar amount of liquor sold to each retailer in the previous calendar year. The report 155.6must be filed on or before March 31 following the close of the calendar year. A person 155.7failing to file this report is subject to the penalty imposed under section 
         289A.60. A 155.8person required to file a report under this section is not required to provide a copy of an 155.9exemption certificate, as defined in section 297A.72, provided to the person by a retailer, 155.10along with the annual informational report.155.11EFFECTIVE DATE.This section is effective for reports required to be filed 155.12beginning in calendar year 2012 and thereafter.155.13    Sec. 3. Minnesota Statutes 2010, section 297G.04, subdivision 2, is amended to read:155.14    Subd. 2. Tax credit. A qualified brewer producing fermented malt beverages 155.15is entitled to a tax credit of $4.60 per barrel on 25,000 barrels sold in any fiscal year 155.16beginning July 1, regardless of the alcohol content of the product. Qualified brewers may 155.17take the credit on the 18th day of each month, but the total credit allowed may not exceed 155.18in any fiscal year the lesser of:155.19(1) the liability for tax; or155.20(2) $115,000.155.21For purposes of this subdivision, a "qualified brewer" means a brewer, whether or 155.22not located in this state, manufacturing less than 100,000 250,000 barrels of fermented 155.23malt beverages in the calendar year immediately preceding the calendar year for which 155.24the credit under this subdivision is claimed. In determining the number of barrels, all 155.25brands or labels of a brewer must be combined. All facilities for the manufacture of 155.26fermented malt beverages owned or controlled by the same person, corporation, or other 155.27entity must be treated as a single brewer.155.28EFFECTIVE DATE.This section is effective for determinations based on calendar 155.29year 2011 production and thereafter.155.30    Sec. 4. Minnesota Statutes 2010, section 298.75, is amended by adding a subdivision 155.31to read:155.32    Subd. 12.Tax may be imposed; Otter Tail County.(a) If Otter Tail County 155.33does not impose a tax under this section and approves imposition of the tax under this 156.1subdivision, the city of Vergas in Otter Tail County may impose the aggregate materials 156.2tax under this section.156.3(b) For purposes of exercising the powers contained in this section, the "city" is 156.4deemed to be the "county."156.5(c) All provisions in this section apply to the city of Vergas, except that in lieu of the 156.6tax proceeds under subdivision 7, all proceeds of the tax must be retained by the city.156.7(d) If Otter Tail County imposes an aggregate materials tax under this section, the 156.8tax imposed by the city of Vergas under this subdivision is repealed on the effective 156.9date of the Otter Tail County tax.156.10EFFECTIVE DATE.This section is effective the day after the governing body of 156.11the city of Vergas and its chief clerical officer comply with Minnesota Statutes, section 156.12645.021, subdivisions 2 and 3.156.13    Sec. 5. Minnesota Statutes 2010, section 469.169, is amended by adding a subdivision 156.14to read:156.15    Subd. 19.Additional border city allocation; 2012.(a) In addition to tax 156.16reductions authorized in subdivisions 7 to 18, the commissioner shall allocate $125,000 156.17for tax reductions to border city enterprise zones in cities located on the western border 156.18of the state. The commissioner shall make allocations to zones in cities on the western 156.19border on a per capita basis. Allocations made under this subdivision may be used for 156.20tax reductions as provided in section 469.171, or for other offsets of taxes imposed on 156.21or remitted by businesses located in the enterprise zone, but only if the municipality 156.22determines that the granting of the tax reduction or offset is necessary in order to retain a 156.23business within or attract a business to the zone. The city alternatively may elect to use 156.24any portion of the allocation provided in this paragraph for tax reductions under section 156.25469.1732 or 469.1734.156.26(b) The commissioner shall allocate $125,000 for tax reductions under section 156.27469.1732 or 469.1734 to cities with border city enterprise zones located on the western 156.28border of the state. The commissioner shall allocate this amount among the cities on a per 156.29capita basis. The city alternatively may elect to use any portion of the allocation provided 156.30in this paragraph for tax reductions as provided in section 469.171.156.31    Sec. 6. LIQUOR REPORTING REQUIREMENTS.156.32A person who was required to submit an annual informational report under 156.33Minnesota Statutes, section 297A.8155, to the commissioner of revenue during calendar 157.1year 2010 or 2011 is not required to provide a copy of an exemption certificate or a 157.2retailer's tax identification number along with the informational report.157.3EFFECTIVE DATE.This section is effective the day following final enactment 157.4and applies to reports required to be filed in calendar year 2010 or 2011.157.5    Sec. 7. PURPOSE STATEMENTS; TAX EXPENDITURES.157.6    Subdivision 1.Authority.This section is intended to fulfill the requirement under 157.7Minnesota Statutes, section 3.192, that a bill creating, renewing, or continuing a tax 157.8expenditure provide a purpose for the tax expenditure and a standard or goal against 157.9which its effectiveness may be measured.157.10    Subd. 2.Federal conformity.The provisions of article 2 conforming Minnesota 157.11individual income tax to changes in federal law are intended to simplify compliance with 157.12and administration of the individual income tax.157.13    Subd. 3.Employment of qualified veterans tax credit.The provisions of article 2, 157.14section 16, providing a tax credit for the employment of qualified veterans, are intended 157.15to give an incentive to employers to hire returning veterans who would otherwise be 157.16unemployed and to encourage their reintegration into the community. The standard against 157.17which the effectiveness of the credit is to be measured is the additional number of veterans 157.18who are hired as a result of the tax credit.157.19    Subd. 4.Extension of historic structure rehabilitation credit.The provisions 157.20of article 2, section 15, extending the sunset of the historic structure rehabilitation credit 157.21are intended to create and retain jobs related to rehabilitation of historic structures in 157.22Minnesota. The standard against which the effectiveness of the extension of the credit is to 157.23be measured is the number of jobs created through the rehabilitation of historic structures 157.24and the number of historic structures rehabilitated and placed in service.157.25    Subd. 5.Exemption of certain laboratory services from the health care provider 157.26tax.The provisions of article 3, section 2, exempting laboratory services on specimens 157.27collected outside the state from the health care provider tax is intended to eliminate 157.28a competitive disadvantage for laboratories located in Minnesota when competing to 157.29provide services with laboratories located outside of the state.157.30    Subd. 6.Sales tax exemption for established religious orders.The provisions 157.31of article 3, section 7, exempting certain sales between a religious order and an affiliated 157.32institute of higher education is intended to retain an existing sales tax exemption that 158.1exists between St. John's Abbey and St. John's University after a governing restructure 158.2between the two entities.158.3    Subd. 7.Sales tax exemption for nursing homes and boarding care homes.158.4The provisions of article 3, section 8, exempting certain nursing homes and boarding 158.5care homes is intended to clarify that an existing exemption for these facilities is not 158.6affected by a recent property tax case related to defining nonprofit organizations engaged 158.7in charitable activities.158.8EFFECTIVE DATE.This section is effective the day following final enactment.158.9    Sec. 8. APPROPRIATION; GREATER MINNESOTA INTERNSHIP 158.10PROGRAM.158.11$1,000,000 for fiscal year 2013 is appropriated from the general fund to the 158.12commissioner of employment and economic development for grants under Minnesota 158.13Statutes, section 136A.129, for employers who hire interns. Up to five percent of 158.14the appropriation is for an administrative fee for the Office of Higher Education and 158.15participating eligible institutions. The base for the Department of Employment and 158.16Economic Development for the greater Minnesota internship program beginning in fiscal 158.17year 2014 is $1,250,000.158.18EFFECTIVE DATE.This section is effective July 1, 2012.158.19    Sec. 9. APPROPRIATION; MINNESOTA INVESTMENT FUND.158.20$2,000,000 for fiscal year 2013 is appropriated from the general fund to the 158.21commissioner of employment and economic development for the Minnesota investment 158.22fund under Minnesota Statutes, section 116J.8731. This is a onetime appropriation and 158.23is available until spent.158.24    Sec. 10. SPECIAL RECOVERY FUND; CANCELLATION.158.25$4,000,000 of the balance in the Revenue Department service and recovery special 158.26revenue fund under Minnesota Statutes, section 270C.15, is transferred in fiscal year 158.272012 to the general fund.158.28EFFECTIVE DATE.This section is effective the day following final enactment.158.29    Sec. 11. BUDGET RESERVE.159.1To offset the payment to the centers for Medicaid and Medicare services for the 159.2federal share of the UCare donation and the net budget effect on the general fund of this act 159.3and other acts, the commissioner of management and budget shall cancel $43,500,000 to 159.4the general fund from the budget reserve account in Minnesota Statutes, section 16A.152.159.5EFFECTIVE DATE.This section is effective the day following final enactment."159.6Delete the title and insert:159.7"A bill for an act159.8relating to financing of state and local government; making changes to individual 159.9income, corporate franchise, property, sales and use, mineral, liquor, aggregate 159.10materials, gross receipts, estate, local, and other taxes and tax-related provisions; 159.11updating references to the Internal Revenue Code; changing and providing 159.12income and franchise tax credits, exemptions, and deductions; changing income 159.13tax withholding requirements; establishing a veterans jobs tax credit; permitting 159.14the filing of certain amended returns; modifying property tax levies, credits, 159.15exemptions, proposed levies and property tax notices, and tax statements; 159.16providing for use of a local levy; changing the state general levy; modifying 159.17the renter property tax refund and providing a supplemental targeting refund; 159.18modifying city aid payments and reporting requirements; modifying tax 159.19increment financing district requirements; authorizing, changing, and extending 159.20tax increment financing districts in certain local governments; changing sales 159.21and use tax payment requirements and changing and providing exemptions; 159.22modifying use of revenues and authorizing extension of certain sales and 159.23lodging taxes and other local taxes for certain cities and making other local tax 159.24changes; modifying filing, compliance, and payment requirements for estate tax 159.25returns; modifying requirements for qualified farms and small business property; 159.26modifying definitions and making clarifying, technical, and other changes 159.27relating to the issuance of municipal bonds; authorizing certain local governments 159.28to issue public debt; clarifying limits on taxation, spending, and incurring debt 159.29based on market values; making technical and clarifying changes, and repealing 159.30obsolete provisions related to the homestead market value credit; changing liquor 159.31tax reporting and credits; requiring a funds transfer; allocating funds to border 159.32city enterprise zones; changing local standard measures program reimbursement 159.33requirements; requiring certain local budgetary information on local Web sites; 159.34establishing a greater Minnesota internship program; requiring reports; canceling 159.35funds to the general fund from the budget reserve account; appropriating 159.36money; amending Minnesota Statutes 2010, sections 6.91, subdivision 2; 159.3738.18; 40A.15, subdivision 2; 69.011, subdivision 1; 69.021, subdivisions 7, 159.388; 88.51, subdivision 3; 103B.245, subdivision 3; 103B.251, subdivision 8; 159.39103B.635, subdivision 2; 103B.691, subdivision 2; 103D.905, subdivisions 2, 3, 159.408; 116J.8737, subdivisions 5, 8, by adding a subdivision; 117.025, subdivision 7; 159.41127A.48, subdivision 1; 138.053; 144F.01, subdivision 4; 162.07, subdivisions 159.423, 4; 163.04, subdivision 3; 163.06, subdivision 6; 165.10, subdivision 1; 159.43272.03, by adding subdivisions; 273.032; 273.11, subdivision 1; 273.113; 159.44273.124, subdivisions 3a, 13; 273.13, subdivision 21b; 273.1398, subdivisions 159.453, 4; 275.011, subdivision 1; 275.025, subdivision 1; 275.065, subdivisions 1, 159.463; 275.077, subdivision 2; 275.71, subdivision 4; 276A.01, subdivisions 10, 159.4712, 13, 15; 287.08; 287.23, subdivision 1; 289A.10, by adding a subdivision; 159.48289A.12, by adding a subdivision; 289A.18, by adding a subdivision; 289A.20, 159.49subdivisions 3, 4, by adding a subdivision; 289A.31, subdivision 5; 290.068, 159.50subdivision 1; 290.0681, subdivisions 1, 3, 4, 5, 10; 290A.04, subdivision 2h; 159.51297A.61, subdivision 4; 297A.68, subdivision 5; 297A.70, subdivision 4, by 159.52adding subdivisions; 297A.815, subdivision 3; 297A.8155; 297G.04, subdivision 159.532; 298.75, by adding a subdivision; 353G.08, subdivision 2; 365.025, subdivision 160.14; 366.095, subdivision 1; 366.27; 368.01, subdivision 23; 368.47; 370.01; 160.2373.40, subdivisions 1, 2, 4; 375.167, subdivision 1; 375.18, subdivision 3; 160.3375.555; 383B.152; 383B.245; 383B.73, subdivision 1; 383E.20; 383E.23; 160.4385.31; 394.36, subdivision 1; 398A.04, subdivision 8; 401.05, subdivision 160.53; 410.32; 412.221, subdivision 2; 412.301; 428A.02, subdivision 1; 430.102, 160.6subdivision 2; 447.10; 450.19; 450.25; 458A.10; 458A.31, subdivision 1; 160.7465.04; 469.033, subdivision 6; 469.034, subdivision 2; 469.053, subdivisions 160.84, 4a, 6; 469.107, subdivision 1; 469.169, by adding a subdivision; 469.174, 160.9subdivisions 2, 10, by adding subdivisions; 469.175, subdivision 3; 469.176, 160.10subdivisions 1b, 4b, by adding a subdivision; 469.1763, subdivisions 3, 4; 160.11469.177, subdivision 1; 469.180, subdivision 2; 469.187; 469.206; 471.24; 160.12471.571, subdivisions 1, 2; 471.73; 473.325, subdivision 2; 473.629; 473.661, 160.13subdivision 3; 473.667, subdivision 9; 473.671; 473.711, subdivision 2a; 160.14473F.02, subdivisions 12, 14, 15, 23; 474A.02, subdivision 23a; 475.521, 160.15subdivisions 2, 4; 475.53, subdivisions 1, 3, 4; 475.58, subdivisions 2, 3b; 160.16475.73, subdivision 1; 477A.011, subdivisions 32, 36; 477A.0124, subdivision 2; 160.17477A.013, by adding a subdivision; 477A.017, subdivision 3; 641.23; 641.24; 160.18645.44, by adding a subdivision; Minnesota Statutes 2011 Supplement, sections 160.19116J.8737, subdivisions 1, 2; 276.04, subdivision 2; 289A.02, subdivision 7; 160.20290.01, subdivisions 19, 31; 290A.03, subdivision 15; 291.005, subdivision 1; 160.21291.03, subdivisions 8, 9, 10, 11; 295.53, subdivision 1; 297A.68, subdivision 42; 160.22469.176, subdivisions 4c, 4m; 469.1763, subdivision 2; 477A.011, subdivision 160.2320; 477A.013, subdivision 9; Laws 1971, chapter 773, section 1, subdivision 2, 160.24as amended; Laws 1988, chapter 645, section 3, as amended; Laws 1998, chapter 160.25389, article 8, section 43, subdivision 3, as amended; Laws 1999, chapter 243, 160.26article 6, section 11; Laws 2002, chapter 377, article 3, section 25, as amended; 160.27Laws 2003, chapter 127, article 12, section 28; Laws 2005, First Special Session 160.28chapter 3, article 5, section 37, subdivisions 2, 4; Laws 2008, chapter 366, article 160.295, section 34, as amended; article 7, section 19, subdivision 3, as amended; Laws 160.302010, chapter 216, section 11; Laws 2010, chapter 389, article 1, section 12; 160.31proposing coding for new law in Minnesota Statutes, chapters 136A; 290; 471; 160.32repealing Minnesota Statutes 2010, sections 273.11, subdivision 1a; 276A.01, 160.33subdivision 11; 276A.06, subdivision 10; 290.92, subdivision 31; 473F.02, 160.34subdivision 13; 473F.08, subdivision 10; 477A.011, subdivision 21; Minnesota 160.35Statutes 2011 Supplement, section 289A.60, subdivision 31; Laws 2009, chapter 160.3688, article 4, section 23, as amended."

161.1We request the adoption of this report and repassage of the bill.161.2House Conferees:161.3
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                     						161.4Greg DavidsSarah Anderson161.5
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                     						161.6Jenifer LoonTara Mack161.7
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                     						161.8Linda Runbeck161.9Senate Conferees:161.10
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                     						161.11Julianne E. OrtmanGeoff Michel161.12
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                     						161.13Julie A. RosenWarren Limmer161.14
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                     						161.15Roger C. Chamberlain