Session Year 2011, Special Session 1

Bill Name: SF0008

ARTICLE 1 - INDIVIDUAL AND ESTATE TAX

Authorizing tax return information
disclosure to the Wisconsin secretary of revenue for reciprocity study;
expanding the income tax subtraction for charitable contributions of food
inventory; creating an income tax subtraction for certain military pension or
other retirement pay from the federal government; modifying the Minnesota
education tax credit; increasing the second tier rate of the research credit
from 2.5 to 4.7 percent of the qualifying research expenses over $2 million for
tax year 2013 and following years; directing the commissioner of revenue to
negotiate a reciprocity agreement with the state of Wisconsin and permitting its
termination only by law; removing payroll and property factor percentages from
the general application and financial institutions apportionment formula; adding
qualified small business property to estate tax definitions; providing an
exclusion for certain farm and small business properties; imposing a recapture
tax under certain conditions; appropriating money for one time to the
commissioner of revenue for the income reciprocity benchmark study

ARTICLE 2
- FEDERAL UPDATE

Conforming to certain changes in the federal internal
revenue code

ARTICLE 3 - SALES AND USE TAXES

Modifying the sales and use
tax payment due dates by removing certain remittance exceptions for vendors;
exempting ring tones from the sales and use tax; making technical changes to
conform to the streamlined sales and use tax agreement; modifying certain
provisions relating to sales and use tax rates for transitional period for
services and advertising and promotional and other direct mail sourcing of sale
requirements; requiring persons reselling admission tickets to charge sales tax
on the total amount for which the ticket is resold and specifying applicable
rules; expanding the sales tax exemption for sales and purchases to local
government units; eliminating the sales tax on purchases by towns; expanding the
sales and use tax exemption for certain public safety radio equipment; exempting
certain aircraft and aircraft equipment from sales and use taxes; repealing the
accelerated payment of monthly sales tax liability penalty for
underpayment

ARTICLE 4 - LOCAL TAXES


Prohibiting local governments from
spending money to promote a local sales
tax, limiting required referendum costs
spending, and requiring the referendum to be held prior to legislative
referendum authorization request; defining the term reserves adequate to meet
such future obligations; modifying the current local sales tax rate in the city
of Hermantown under certain conditions; modifying the Rochester local sales and
use tax authority by allowing tax revenues to pay for certain capital and
project expenditures and bonds; allowing a bonding referendum, limiting bond
aggregate principal amounts, and authorizing extension of taxes; modifying the
use of proceeds from the sales tax in Clearwater for regional parks, bicycle
trails, park land open space and pedestrian walkways; extending the
authorization for Marshall local tax imposition; authorizing Cloquet to impose
by ordinance sales and use and excise taxes and to issue obligation bonds,
specifying use of revenues, providing for tax termination; authorizing Fergus
Falls to impose a sales and use tax; authorizing and providing for Hutchinson to
impose by ordinance a sales and use
tax and a motor vehicle tax for a new water
treatment facility and to improve the wastewater treatment facility, providing
for tax termination; authorizing Lanesboro to impose by ordinance a sales and
use tax up to a certain amount to be used for city street, utility system, and
municipal building improvements, authorizing city bonds issuance, providing for
tax termination upon city council sufficient revenue determination; authorizing
Marshall to impose a local sales and use tax for the Minnesota emergency
response and industry training center and the Southwest Minnesota regional
amateur sports center, authorizing bonds and providing for tax termination;
authorizing and providing for Medford to impose by ordinance a sales and use tax
to repay certain loans associated with the financing of improvements to the city
water and wastewater systems, providing for tax termination

ARTICLE 5 -
PROPERTY TAXES

Modifying the school district referendum market value tax
base; extending the allowed time period for political subdivisions holding state
property for economic development purposes; providing for a property tax
exemption for attached machinery and personal property that is a part of certain
electric generation facilities; specifying certain facility compliance criteria;
providing for appeals of denial of Green Acres treatment; requiring the property
valuation notice to specifically note when a property has been reclassified from
the previous assessment year; expanding certain requirements for 4c property
classification; extending eligibility for disabled veterans surviving spouses
homestead market value exemption of property owned in whole or part to approved
primary family caregivers of qualified disabled veteran; defining certain terms;
modifying the state general levy against commercial-industrial property and
seasonal residential recreational property; modifying special levies and the
adjusted levy limit base; suspending ling maintenance of effort requirements;
repealing the state general tax

ARTICLE 6 - AIDS, CREDITS, PAYMENTS, AND
REFUNDS

Eliminating the sustainable forest incentive program; permanently
reducing payments in lieu of tax (PILT) payments per acre on natural resource
lands; reducing the goose management cropland payment amount; eliminating the
political contribution refund; defining a forest management plan to provide a
framework for site-specific healthy, productive, and sustainable forest
resources and specifying requirements; providing a homestead market value
exclusion; using the agricultural homestead market value credit as the basis for
tax reductions and reimbursement; making disparity reduction equal to the amount
certified for aid payable in 2011; reducing the percent of rent constituting
property taxes for renter property tax refund claims from 19 percent to 15
percent; reducing the rent credit; reducing the
percentage of property taxes
payable for manufactured home and park trailers; increasing the homeowner
property tax refund; providing separate schedules for senior/disabled renters
and nonsenior/nondisabled renters, with the maximum income eligible decreased to
$40,000 for senior/disabled claimants and to $25,000 for nonsenior/nondisabled
claimants; authorizing an alternative process for consolidating counties;
defining first class city for local government aid (LGA); specifying county LGA
aid for 2011 and city formula aid for first class cities for 2013 and
eliminating city formula aid for 2014 and thereafter; specifying city aid
distribution for 2013 and 2014; specifying municipal distribution LGA for 2011
and 2012 and the appropriation amounts; increasing the county-administered and
township LGA general distribution; changing the in lieu payment appraised value
percentage for the Lake Vermilion and Soudan underground mine state parks annual
payments; specifying property tax refund claims administration for 2011;
limiting the market value credit reimbursement for county and city payments;
specifying the gross tax amount shown for the previous year; requiring a
legislative report on payment in lieu of taxes (PILT) for state natural resource
lands; authorizing the commissioner of administration to
make cooperation and
consolidation grants to certain local governments;
repealing the sustainable
forest incentive program and providing for transition payments and
appropriation, the political contribution refund, wetlands exemption replacement
of revenue, an inflation adjustment, the residential homestead market value
credit, a credit reduction, and the Sustainable Forest Incentive Act (SFIA)
program

ARTICLE 7 - MINERALS

Exempting certain property used in the
business of mining from the net
proceeds tax on mining; defining refining;
subjecting refining to the occupation tax and including hydrometallurgical
processes in the definition of mining for tax purposes; including ore in gross
income calculation; applying a tax imposition to ores and metals; modifying the
metal and minerals product definition; removing the Range Association of
Municipalities and Schools (RAMS) from the taconite production tax guaranteed
distribution; changing the imposed tax on taconite and sulphides and the
proceeds municipal distribution amount; repealing the Range Association of
Municipalities and Schools (RAMS) and the Eveleth Hockey Hall of Fame
distribution and the state taconite aid distribution and deductions

ARTICLE 8
- INSURANCES TAXES

Modifying certain insurance tax provisions; defining and
redefining certain terms and conforming certain provisions; modifying surplus
lines tax requirements; repealing certain provisions relating to bad debt
refunds, and tax imposed on persons, firms, or corporation procuring insurance
from unlicensed foreign companies or from an ineligible company

ARTICLE 9 -
SCIENCE AND TECHNOLOGY PROGRAM

"Minnesota science and technology program";
establishing the Minnesota science and technology authority, specifying powers;
allowing the authority to establish a commercialized research program to
accelerate science and technology products commercialization, a federal research
and development support program to increase federal funding, and an industry
technology and competitiveness program to advance technological capacity;
requiring entity financial assistance authority repayment; sunset date;
appropriating money

ARTICLE 10 - MISCELLANEOUS

Requiring the tax incidence
study prepared by the department of revenue to include information on federal
tax burden; transferring amounts in the budget reserve account, cash flow
account, and Douglas J. Johnson fund to the general fund

ARTICLE 11 - TOBACCO
BONDS

Providing an exception from the general rule that the proceeds of
litigation or a settlement must be deposited in the general fund; providing for
tobacco settlement revenues may be deposited under the terms of the tobacco
securitization bond provision; authorizing the commissioner of management and
budget to issue debt under either the tobacco securitization bond provision or
the tobacco appropriation bonds provision; authorizing the use of tobacco
securitization bonds; creating the tobacco securitization authority; authorizing
the authority to issue bonds in an aggregate principal amount and to provide
sufficient funds for the establishment of a debt service reserve fund and the
payment or provision for financing costs and capitalized interest; authorizing
the issuance of tobacco appropriation bonds; establishing a process for
validation of the appropriation bonds by the supreme court
(ra)