1.1CONFERENCE COMMITTEE REPORT ON H. F. No. 6771.2A bill for an act1.3 relating to financing of state and local government; making changes to individual 1.4income, corporate franchise, property, sales and use, estate, mineral, liquor, 1.5tobacco, aggregate materials, local, and other taxes and tax-related provisions; 1.6restoring the school district current year aid payment shift percentage to 90; 1.7conforming to federal section 179 expensing allowances; imposing an income 1.8surcharge; allowing an up-front exemption for capital equipment; modifying 1.9the definition of income for the property tax refund; decreasing the threshold 1.10percentage for the homestead credit refund for homeowners and the property 1.11tax refund for renters; increasing the maximum refunds for renters; changing 1.12property tax aids and credits; imposing an insurance surcharge; modifying 1.13pension aids; providing pension funding; changing provisions of the Sustainable 1.14Forest Incentive Act; modifying definitions for property taxes; providing 1.15exemptions; creating joint entertainment facilities coordination; imposing a 1.16sports memorabilia gross receipts tax; changing tax rates on tobacco and liquor; 1.17providing reimbursement for certain property tax abatement; modifying the small 1.18business investment tax credit; expanding the definition of domestic corporation 1.19to include foreign corporations incorporated in or doing business in tax havens; 1.20making changes to additions and subtractions from federal taxable income; 1.21changing rates for individuals, estates, and trusts; providing for charitable 1.22contributions and veterans jobs tax credits; modifying estate tax exclusions for 1.23qualifying small business and farm property; imposing a gift tax; expanding 1.24the sales tax to include suite and box seat rentals; modifying the definition 1.25of sales and purchase; changing the tax rate and modifying provisions for the 1.26rental motor vehicle tax; modifying nexus provisions; providing for multiple 1.27points of use certificates; modifying exemptions; authorizing local sales taxes; 1.28authorizing economic development powers; providing authority, organization, 1.29powers, and duties for development of a Destination Medical Center; authorizing 1.30state infrastructure aid; imposing a tax on extraction and processing of fracturing 1.31sand; providing a taconite production tax grant for water supply improvements; 1.32authorizing taconite production tax bonds for grants to school districts; modifying 1.33and providing provisions for public finance; modifying the definition of market 1.34value for tax, debt, and other purposes; requiring labor peace agreements on 1.35certain qualifying projects; making conforming, policy, and technical changes to 1.36tax provisions; requiring studies and reports; appropriating money;amending 1.37Minnesota Statutes 2012, sections 16A.152, subdivision 2; 16A.46; 38.18; 1.3840A.15, subdivision 2; 69.011, subdivision 1; 69.021, subdivisions 7, 8, by 1.39adding a subdivision; 88.51, subdivision 3; 103B.102, subdivision 3; 103B.245, 1.40subdivision 3; 103B.251, subdivision 8; 103B.335; 103B.3369, subdivision 5; 1.41103B.635, subdivision 2; 103B.691, subdivision 2; 103C.501, subdivision 4; 1.42103D.905, subdivisions 2, 3, 8; 103F.405, subdivision 1; 116J.8737, subdivisions 1.431, 2, 8; 117.025, subdivision 7; 118A.04, subdivision 3; 118A.05, subdivision 2.15; 123A.455, subdivision 1; 123B.75, subdivision 5; 126C.48, subdivision 8; 2.2127A.45, subdivision 2; 127A.48, subdivision 1; 138.053; 144F.01, subdivision 2.34; 162.07, subdivisions 3, 4; 163.04, subdivision 3; 163.051; 163.06, subdivision 2.46; 165.10, subdivision 1; 168.012, subdivision 9, by adding a subdivision; 2.5216C.436, subdivision 7; 237.52, subdivision 3, by adding a subdivision; 2.6270.077; 270.41, subdivision 5; 270B.01, subdivision 8; 270B.12, subdivision 2.74; 270C.34, subdivision 1; 270C.38, subdivision 1; 270C.42, subdivision 2; 2.8270C.56, subdivision 1; 271.06, by adding a subdivision; 272.01, subdivision 2; 2.9272.02, subdivisions 39, 97, by adding subdivisions; 272.03, subdivision 9, by 2.10adding subdivisions; 273.032; 273.11, subdivision 1, by adding a subdivision; 2.11273.114, subdivision 6; 273.124, subdivisions 3a, 13; 273.13, subdivisions 2.1221b, 23, 25; 273.1398, subdivisions 3, 4; 273.19, subdivision 1; 273.372, 2.13subdivision 4; 273.39; 275.011, subdivision 1; 275.077, subdivision 2; 275.71, 2.14subdivision 4; 276.04, subdivision 2; 276A.01, subdivisions 10, 12, 13, 15; 2.15276A.06, subdivision 10; 279.01, subdivision 1, by adding a subdivision; 279.02; 2.16279.06, subdivision 1; 287.05, by adding a subdivision; 287.08; 287.20, by 2.17adding a subdivision; 287.23, subdivision 1; 287.385, subdivision 7; 289A.02, 2.18subdivision 7; 289A.08, subdivisions 1, 3, 7; 289A.10, subdivision 1, by adding 2.19a subdivision; 289A.12, subdivision 14, by adding a subdivision; 289A.18, by 2.20adding a subdivision; 289A.20, subdivisions 3, 4, by adding a subdivision; 2.21289A.26, subdivisions 3, 4, 7, 9; 289A.55, subdivision 9; 289A.60, subdivision 2.224; 290.01, subdivisions 5, 19, as amended, 19a, 19b, 19c, 19d, 31, as amended, 2.23by adding subdivisions; 290.06, subdivisions 2c, 2d, by adding subdivisions; 2.24290.067, subdivisions 1, 2a; 290.0671, subdivision 1; 290.0675, subdivision 1; 2.25290.0677, subdivision 2; 290.068, subdivisions 3, 6a; 290.0681, subdivisions 1, 2.263, 4, 5; 290.091, subdivision 2; 290.0921, subdivision 3; 290.0922, subdivision 1; 2.27290.17, subdivision 4; 290.21, subdivision 4; 290.9705, subdivision 1; 290A.03, 2.28subdivisions 3, 15, as amended; 290A.04, subdivisions 2, 2a, 4; 290B.04, 2.29subdivision 2; 290C.02, subdivision 6; 290C.05; 290C.07; 291.005, subdivision 2.301; 291.03, subdivisions 1, 8, 9, 10, 11, by adding a subdivision; 296A.01, 2.31subdivision 19, by adding a subdivision; 296A.22, subdivisions 1, 3; 297A.61, 2.32subdivisions 3, 4, by adding a subdivision; 297A.64, subdivisions 1, 2; 297A.66, 2.33by adding a subdivision; 297A.665; 297A.668, by adding a subdivision; 2.34297A.67, subdivision 7; 297A.68, subdivision 5; 297A.70, subdivisions 4, 8, by 2.35adding subdivisions; 297A.71, by adding subdivisions; 297A.75, subdivisions 1, 2.362, 3; 297A.815, subdivision 3; 297A.993, subdivisions 1, 2; 297B.11; 297E.021, 2.37subdivision 2; 297E.14, subdivision 7; 297F.01, subdivisions 3, 19, 23, by 2.38adding a subdivision; 297F.05, subdivisions 1, 3, 4, by adding a subdivision; 2.39297F.09, subdivision 9; 297F.18, subdivision 7; 297F.24, subdivision 1; 297F.25, 2.40subdivision 1; 297G.03, subdivision 1, by adding a subdivision; 297G.04; 2.41297G.09, subdivision 8; 297G.17, subdivision 7; 297I.05, subdivisions 7, 11, 12; 2.42297I.30, subdivisions 1, 2; 297I.80, subdivision 1; 298.01, subdivisions 3, 3b, 2.434; 298.018; 298.227, as amended; 298.24, subdivision 1; 298.28, subdivisions 2.444, 6, 10; 298.75, subdivision 2; 325D.32, subdivision 2; 353G.08, subdivision 2.452; 365.025, subdivision 4; 366.095, subdivision 1; 366.27; 368.01, subdivision 2.4623; 368.47; 370.01; 373.01, subdivisions 1, 3; 373.40, subdivisions 1, 2, 4; 2.47375.167, subdivision 1; 375.18, subdivision 3; 375.555; 383B.152; 383B.245; 2.48383B.73, subdivision 1; 383D.41, by adding a subdivision; 383E.20; 383E.23; 2.49385.31; 394.36, subdivision 1; 398A.04, subdivision 8; 401.05, subdivision 3; 2.50403.02, subdivision 21, by adding subdivisions; 403.06, subdivision 1a; 403.11, 2.51subdivision 1, by adding a subdivision; 410.32; 412.221, subdivision 2; 412.301; 2.52428A.02, subdivision 1; 430.102, subdivision 2; 447.10; 450.19; 450.25; 2.53458A.10; 458A.31, subdivision 1; 465.04; 469.033, subdivision 6; 469.034, 2.54subdivision 2; 469.053, subdivisions 4, 4a, 6; 469.071, subdivision 5; 469.107, 2.55subdivision 1; 469.169, by adding a subdivision; 469.176, subdivisions 4c, 4g, 2.566; 469.177, by adding a subdivision; 469.180, subdivision 2; 469.187; 469.190, 2.57subdivision 7, by adding a subdivision; 469.206; 469.319, subdivision 4; 469.340, 2.58subdivision 4; 471.24; 471.571, subdivisions 1, 2; 471.73; 473.325, subdivision 3.12; 473.39, by adding a subdivision; 473.629; 473.661, subdivision 3; 473.667, 3.2subdivision 9; 473.671; 473.711, subdivision 2a; 473F.02, subdivisions 12, 14, 3.315, 23; 473F.08, subdivision 10, by adding a subdivision; 474A.04, subdivision 3.41a; 474A.062; 474A.091, subdivision 3a; 475.521, subdivisions 1, 2, 4; 475.53, 3.5subdivisions 1, 3, 4; 475.58, subdivisions 2, 3b; 475.73, subdivision 1; 477A.011, 3.6subdivisions 20, 30, 32, 34, 42, by adding subdivisions; 477A.0124, subdivision 3.72; 477A.013, subdivisions 8, 9, by adding a subdivision; 477A.015; 477A.03, 3.8subdivisions 2a, 2b, by adding a subdivision; 641.23; 641.24; 645.44, by adding 3.9a subdivision; Laws 1971, chapter 773, section 1, subdivision 2, as amended; 3.10Laws 1988, chapter 645, section 3, as amended; Laws 1993, chapter 375, article 3.119, section 46, subdivisions 2, as amended, 5, as amended; Laws 1998, chapter 3.12389, article 8, section 43, subdivisions 1, 3, as amended, 5, as amended; Laws 3.131999, chapter 243, article 6, section 11; Laws 2002, chapter 377, article 3, section 3.1425, as amended; Laws 2005, First Special Session chapter 3, article 5, section 3.1537, subdivisions 2, 4; Laws 2008, chapter 366, article 5, sections 26; 33; 34, as 3.16amended; article 7, section 19, subdivision 3, as amended; Laws 2010, chapter 3.17216, section 55; Laws 2010, chapter 389, article 1, section 12; article 5, section 6, 3.18subdivisions 4, 6; Laws 2010, First Special Session chapter 1, article 13, section 4, 3.19subdivision 1, as amended; proposing coding for new law in Minnesota Statutes, 3.20chapters 116C; 287; 290; 290A; 292; 295; 297I; 403; 435; 469; proposing coding 3.21for new law as Minnesota Statutes, chapter 297J; repealing Minnesota Statutes 3.222012, sections 16A.725; 256.9658; 272.69; 273.11, subdivisions 1a, 22; 276A.01, 3.23subdivision 11; 289A.60, subdivision 31; 290.01, subdivision 6b; 290.06, 3.24subdivision 22a; 290.0672; 290.0921, subdivision 7; 383A.80, subdivision 4; 3.25383B.80, subdivision 4; 428A.101; 428A.21; 473F.02, subdivision 13; 477A.011, 3.26subdivisions 2a, 19, 21, 29, 31, 32, 33, 36, 39, 40, 41, 42; 477A.013, subdivisions 3.2711, 12; 477A.0133; 477A.0134; Laws 2006, chapter 259, article 11, section 3, as 3.28amended; Laws 2009, chapter 88, article 4, section 23, as amended.3.29May 19, 20133.30The Honorable Paul Thissen3.31Speaker of the House of Representatives3.32The Honorable Sandra L. Pappas3.33President of the Senate3.34We, the undersigned conferees for H. F. No. 677 report that we have agreed upon the 3.35items in dispute and recommend as follows:3.36That the Senate recede from its amendments and that H. F. No. 677 be further 3.37amended as follows:3.38Delete everything after the enacting clause and insert:3.39"ARTICLE 13.40HOMESTEAD CREDIT REFUND AND RENTER PROPERTY TAX REFUND3.41    Section 1. Minnesota Statutes 2012, section 290A.03, subdivision 3, is amended to read:3.42    Subd. 3. Income. (1) "Income" means the sum of the following:3.43    (a) federal adjusted gross income as defined in the Internal Revenue Code; and3.44    (b) the sum of the following amounts to the extent not included in clause (a):3.45    (i) all nontaxable income;4.1    (ii) the amount of a passive activity loss that is not disallowed as a result of section 4.2469, paragraph (i) or (m) of the Internal Revenue Code and the amount of passive activity 4.3loss carryover allowed under section 469(b) of the Internal Revenue Code;4.4    (iii) an amount equal to the total of any discharge of qualified farm indebtedness 4.5of a solvent individual excluded from gross income under section 108(g) of the Internal 4.6Revenue Code;4.7    (iv) cash public assistance and relief;4.8    (v) any pension or annuity (including railroad retirement benefits, all payments 4.9received under the federal Social Security Act, Supplemental Security Income, and 4.10veterans benefits), which was not exclusively funded by the claimant or spouse, or which 4.11was funded exclusively by the claimant or spouse and which funding payments were 4.12excluded from federal adjusted gross income in the years when the payments were made;4.13    (vi) interest received from the federal or a state government or any instrumentality 4.14or political subdivision thereof;4.15    (vii) workers' compensation;4.16    (viii) nontaxable strike benefits;4.17    (ix) the gross amounts of payments received in the nature of disability income or 4.18sick pay as a result of accident, sickness, or other disability, whether funded through 4.19insurance or otherwise;4.20    (x) a lump-sum distribution under section 402(e)(3) of the Internal Revenue Code of 4.211986, as amended through December 31, 1995;4.22    (xi) contributions made by the claimant to an individual retirement account, 4.23including a qualified voluntary employee contribution; simplified employee pension plan; 4.24self-employed retirement plan; cash or deferred arrangement plan under section 401(k) 4.25of the Internal Revenue Code; or deferred compensation plan under section 457 of the 4.26Internal Revenue Code, to the extent the sum of amounts exceeds the retirement base 4.27amount for the claimant and spouse;4.28    (xii) to the extent not included in federal adjusted gross income, distributions received 4.29by the claimant or spouse from a traditional or Roth style retirement account or plan;4.30    (xiii) nontaxable scholarship or fellowship grants;4.31    (xiii) (xiv) the amount of deduction allowed under section 199 of the Internal 4.32Revenue Code;4.33    (xiv) (xv) the amount of deduction allowed under section 220 or 223 of the Internal 4.34Revenue Code;5.1    (xv) (xvi) the amount ofdeducted for tuition expenses required to be added to 5.2income under section 290.01, subdivision 19a, clause (12); under section 222 of the 5.3Internal Revenue Code; and5.4    (xvi) (xvii) the amount deducted for certain expenses of elementary and secondary 5.5school teachers under section 62(a)(2)(D) of the Internal Revenue Code; and.5.6    (xvii) unemployment compensation.5.7    In the case of an individual who files an income tax return on a fiscal year basis, the 5.8term "federal adjusted gross income" shall mean federal adjusted gross income reflected 5.9in the fiscal year ending in the calendar year. Federal adjusted gross income shall not be 5.10reduced by the amount of a net operating loss carryback or carryforward or a capital loss 5.11carryback or carryforward allowed for the year.5.12    (2) "Income" does not include:5.13    (a) amounts excluded pursuant to the Internal Revenue Code, sections 101(a) and 102;5.14    (b) amounts of any pension or annuity which was exclusively funded by the claimant 5.15or spouse and which funding payments were not excluded from federal adjusted gross 5.16income in the years when the payments were made;5.17    (c) to the extent included in federal adjusted gross income, amounts contributed by 5.18the claimant or spouse to a traditional or Roth style retirement account or plan, but not 5.19to exceed the retirement base amount reduced by the amount of contributions excluded 5.20from federal adjusted gross income, but not less than zero;5.21    (d) surplus food or other relief in kind supplied by a governmental agency;5.22    (d) (e) relief granted under this chapter;5.23    (e) (f) child support payments received under a temporary or final decree of 5.24dissolution or legal separation; or5.25    (f) (g) restitution payments received by eligible individuals and excludable interest 5.26as defined in section 803 of the Economic Growth and Tax Relief Reconciliation Act of 5.272001, Public Law 107-16.5.28    (3) The sum of the following amounts may be subtracted from income:5.29    (a) for the claimant's first dependent, the exemption amount multiplied by 1.4;5.30    (b) for the claimant's second dependent, the exemption amount multiplied by 1.3;5.31    (c) for the claimant's third dependent, the exemption amount multiplied by 1.2;5.32    (d) for the claimant's fourth dependent, the exemption amount multiplied by 1.1;5.33    (e) for the claimant's fifth dependent, the exemption amount; and5.34    (f) if the claimant or claimant's spouse was disabled or attained the age of 65 5.35on or before December 31 of the year for which the taxes were levied or rent paid, the 5.36exemption amount.6.1    For purposes of this subdivision, the "exemption amount" means the exemption 6.2amount under section 151(d) of the Internal Revenue Code for the taxable year for which 6.3the income is reported; "retirement base amount" means the deductible amount for the 6.4taxable year for the claimant and spouse under section 219(b)(5)(A) of the Internal 6.5Revenue Code, adjusted for inflation as provided in section 219(b)(5)(D) of the Internal 6.6Revenue Code, without regard to whether the claimant or spouse claimed a deduction; 6.7and "traditional or Roth style retirement account or plan" means retirement plans under 6.8sections 401, 403, 408, 408A, and 457 of the Internal Revenue Code.6.9EFFECTIVE DATE.This section is effective beginning with refunds based on 6.10property taxes payable in 2014 and rent paid in 2013.6.11    Sec. 2. Minnesota Statutes 2012, section 290A.04, subdivision 2, is amended to read:6.12    Subd. 2. Homeowners; homestead credit refund. A claimant whose property 6.13taxes payable are in excess of the percentage of the household income stated below shall 6.14pay an amount equal to the percent of income shown for the appropriate household 6.15income level along with the percent to be paid by the claimant of the remaining amount 6.16of property taxes payable. The state refund equals the amount of property taxes payable 6.17that remain, up to the state refund amount shown below.

6.186.196.20Household IncomePercent of IncomePercent Paid byClaimantMaximum StateRefund6.21$0 to 1,5491.0 percent15 percent$2,4606.221,550 to 3,0891.1 percent15 percent$2,4606.233,090 to 4,6691.2 percent15 percent$2,4606.244,670 to 6,2291.3 percent20 percent$2,4606.256,230 to 7,7691.4 percent20 percent$2,4606.267,770 to 10,8791.5 percent20 percent$2,4606.2710,880 to 12,4291.6 percent20 percent$2,4606.2812,430 to 13,9891.7 percent20 percent$2,4606.2913,990 to 15,5391.8 percent20 percent$2,4606.3015,540 to 17,0791.9 percent25 percent$2,4606.3117,080 to 18,6592.0 percent25 percent$2,4606.3218,660 to 21,7592.1 percent25 percent$2,4606.3321,760 to 23,3092.2 percent30 percent$2,4606.3423,310 to 24,8592.3 percent30 percent$2,4606.3524,860 to 26,4192.4 percent30 percent$2,4606.3626,420 to 32,6292.5 percent35 percent$2,4606.3732,630 to 37,2792.6 percent35 percent$2,4606.3837,280 to 46,6092.7 percent35 percent$2,0006.3946,610 to 54,3692.8 percent35 percent$2,0007.154,370 to 62,1392.8 percent40 percent$1,7507.262,140 to 69,9093.0 percent40 percent$1,4407.369,910 to 77,6793.0 percent40 percent$1,2907.477,680 to 85,4493.0 percent40 percent$1,1307.585,450 to 90,1193.5 percent45 percent$9607.690,120 to 93,2393.5 percent45 percent$7907.793,240 to 97,0093.5 percent50 percent$6507.897,010 to 100,7793.5 percent50 percent$480

7.97.107.11Household IncomePercent of IncomePercent Paid byClaimantMaximum StateRefund7.12$0 to 1,6191.0 percent15 percent$2,5807.131,620 to 3,2291.1 percent15 percent$2,5807.143,230 to 4,8891.2 percent15 percent$2,5807.154,890 to 6,5191.3 percent20 percent$2,5807.166,520 to 8,1291.4 percent20 percent$2,5807.178,130 to 11,3891.5 percent20 percent$2,5807.1811,390 to 13,0091.6 percent20 percent$2,5807.1913,010 to 14,6491.7 percent20 percent$2,5807.2014,650 to 16,2691.8 percent20 percent$2,5807.2116,270 to 17,8791.9 percent25 percent$2,5807.2217,880 to 22,7792.0 percent25 percent$2,5807.2322,780 to 24,3992.0 percent30 percent$2,5807.2424,400 to 27,6592.0 percent30 percent$2,5807.2527,660 to 39,0292.0 percent35 percent$2,5807.2639,030 to 56,9192.0 percent35 percent$2,0907.2756,920 to 65,0492.0 percent40 percent$1,8307.2865,050 to 73,1892.1 percent40 percent$1,5107.2973,190 to 81,3192.2 percent40 percent$1,3507.3081,320 to 89,4492.3 percent40 percent$1,1807.3189,450 to 94,3392.4 percent45 percent$1,0007.3294,340 to 97,6092.5 percent45 percent$8307.3397,610 to 101,5592.5 percent50 percent$6807.34101,560 to 105,4992.5 percent50 percent$500

7.35    The payment made to a claimant shall be the amount of the state refund calculated 7.36under this subdivision. No payment is allowed if the claimant's household income is 7.37$100,780 $105,500 or more.7.38EFFECTIVE DATE.This section is effective for refund claims based on taxes 7.39payable in 2014 and thereafter.7.40    Sec. 3. Minnesota Statutes 2012, section 290A.04, subdivision 2a, is amended to read:8.1    Subd. 2a. Renters. A claimant whose rent constituting property taxes exceeds the 8.2percentage of the household income stated below must pay an amount equal to the percent 8.3of income shown for the appropriate household income level along with the percent to 8.4be paid by the claimant of the remaining amount of rent constituting property taxes. The 8.5state refund equals the amount of rent constituting property taxes that remain, up to the 8.6maximum state refund amount shown below.

8.78.88.9Household IncomePercent of IncomePercent Paid by
                  		ClaimantMaximum 
                  		State
                  		Refund8.10$0 to 3,5891.0 percent5 percent$1,1908.113,590 to 4,7791.0 percent10 percent$1,1908.124,780 to 5,9691.1 percent10 percent$1,1908.135,970 to 8,3691.2 percent10 percent$1,1908.148,370 to 10,7591.3 percent15 percent$1,1908.1510,760 to 11,9491.4 percent15 percent$1,1908.1611,950 to 13,1391.4 percent20 percent$1,1908.1713,140 to 15,5391.5 percent20 percent$1,1908.1815,540 to 16,7291.6 percent20 percent$1,1908.1916,730 to 17,9191.7 percent25 percent$1,1908.2017,920 to 20,3191.8 percent25 percent$1,1908.2120,320 to 21,5091.9 percent30 percent$1,1908.2221,510 to 22,6992.0 percent30 percent$1,1908.2322,700 to 23,8992.2 percent30 percent$1,1908.2423,900 to 25,0892.4 percent30 percent$1,1908.2525,090 to 26,2892.6 percent35 percent$1,1908.2626,290 to 27,4892.7 percent35 percent$1,1908.2727,490 to 28,6792.8 percent35 percent$1,1908.2828,680 to 29,8692.9 percent40 percent$1,1908.2929,870 to 31,0793.0 percent40 percent$1,1908.3031,080 to 32,2693.1 percent40 percent$1,1908.3132,270 to 33,4593.2 percent40 percent$1,1908.3233,460 to 34,6493.3 percent45 percent$1,0808.3334,650 to 35,8493.4 percent45 percent$9608.3435,850 to 37,0493.5 percent45 percent$8308.3537,050 to 38,2393.5 percent50 percent$7208.3638,240 to 39,4393.5 percent50 percent$6008.3738,440 to 40,6293.5 percent50 percent$3608.3840,630 to 41,8193.5 percent50 percent$120

8.39$0 to 4,9091.0 percent5 percent$2,0008.404,910 to 6,5291.0 percent10 percent$2,0008.416,530 to 8,1591.1 percent10 percent$1,9508.428,160 to 11,4391.2 percent10 percent$1,9009.111,440 to 14,7091.3 percent15 percent$1,8509.214,710 to 16,3391.4 percent15 percent$1,8009.316,340 to 17,9591.4 percent20 percent$1,7509.417,960 to 21,2391.5 percent20 percent$1,7009.521,240 to 22,8691.6 percent20 percent$1,6509.622,870 to 24,4991.7 percent25 percent$1,6509.724,500 to 27,7791.8 percent25 percent$1,6509.827,780 to 29,3991.9 percent30 percent$1,6509.929,400 to 34,2992.0 percent30 percent$1,6509.1034,300 to 39,1992.0 percent35 percent$1,6509.1139,200 to 45,7392.0 percent40 percent$1,6509.1245,740 to 47,3692.0 percent45 percent$1,5009.1347,370 to 49,0092.0 percent45 percent$1,3509.1449,010 to 50,6492.0 percent45 percent$1,1509.1550,650 to 52,2692.0 percent50 percent$1,0009.1652,270 to 53,9092.0 percent50 percent$9009.1753,910 to 55,5392.0 percent50 percent$5009.1855,540 to 57,1692.0 percent50 percent$200

9.19    The payment made to a claimant is the amount of the state refund calculated under 9.20this subdivision. No payment is allowed if the claimant's household income is $41,8209.21 $57,170 or more.9.22EFFECTIVE DATE.This section is effective for claims based on rent paid in 9.232013 and following years.9.24    Sec. 4. Minnesota Statutes 2012, section 290A.04, subdivision 4, is amended to read:9.25    Subd. 4. Inflation adjustment. (a) Beginning for property tax refunds payable in 9.26calendar year 2002, the commissioner shall annually adjust the dollar amounts of the 9.27income thresholds and the maximum refunds under subdivisions 2 and 2a for inflation. 9.28The commissioner shall make the inflation adjustments in accordance with section 1(f) of 9.29the Internal Revenue Code, except that for purposes of this subdivision the percentage 9.30increase shall be determined as provided in this subdivision.9.31    (b) In adjusting the dollar amounts of the income thresholds and the maximum 9.32refunds under subdivision 2 for inflation, the percentage increase shall be determined 9.33from the year ending on June 30, 2011 2013, to the year ending on June 30 of the year 9.34preceding that in which the refund is payable.9.35    (c) In adjusting the dollar amounts of the income thresholds and the maximum 9.36refunds under subdivision 2a for inflation, the percentage increase shall be determined 10.1from the year ending on June 30, 2000 2013, to the year ending on June 30 of the year 10.2preceding that in which the refund is payable.10.3    (d) The commissioner shall use the appropriate percentage increase to annually 10.4adjust the income thresholds and maximum refunds under subdivisions 2 and 2a for 10.5inflation without regard to whether or not the income tax brackets are adjusted for inflation 10.6in that year. The commissioner shall round the thresholds and the maximum amounts, 10.7as adjusted to the nearest $10 amount. If the amount ends in $5, the commissioner shall 10.8round it up to the next $10 amount.10.9    (e) The commissioner shall annually announce the adjusted refund schedule at the 10.10same time provided under section 
         290.06. The determination of the commissioner under 10.11this subdivision is not a rule under the Administrative Procedure Act.10.12EFFECTIVE DATE.This section is effective for refund claims based on taxes 10.13payable in 2014 and rent paid in 2013 and following years.10.14    Sec. 5. [290A.28] NOTIFICATION OF POTENTIAL ELIGIBILITY.10.15    Subdivision 1.Notification of eligibility.(a) By September 1, 2014, the 10.16commissioner shall notify, in writing or electronically, individual homeowners whom the 10.17commissioner determines may be eligible for a homestead credit refund under this chapter 10.18for that property taxes payable year as provided in this section. In determining whether 10.19to notify a homeowner, the commissioner shall consider the property tax information 10.20available to the commissioner under paragraph (b) for the homeowner and must estimate 10.21the homeowner's household income using the most recent income information available to 10.22the commissioner from filing under this chapter for the prior year, under chapter 290 for 10.23the current or prior year, and any other income information available to the commissioner.  10.24For each homeowner, the commissioner must estimate the homestead credit refund 10.25amount under the schedule in section 290A.04, subdivision 2, using the homeowner's 10.26property tax amount and estimated household income. If the estimated homestead credit 10.27refund is at least $1,000, the commissioner must notify the homeowner of potential 10.28eligibility for the homestead credit refund. The notification must include information 10.29on how to file for the homestead credit refund. The notification requirement under this 10.30section does not apply to a homeowner who has already filed for the homestead credit 10.31refund for the current or prior year.10.32    (b) By May 15, 2014, each county auditor shall transmit to the commissioner 10.33of revenue the following information for each property classified as a residential or 10.34agricultural homestead under section 273.13, subdivision 22 or 23:10.35    (1) the property taxes payable;11.1    (2) the name and address of the owner;11.2    (3) the Social Security number or numbers of the owners; and11.3    (4) any other information the commissioner deems necessary or useful to carry 11.4out the provisions of this section.11.5The information must be provided in the form and manner prescribed by the commissioner.11.6    Subd. 2.Reports.(a) By March 15, 2015, the commissioner must provide a written 11.7report to the chairs and ranking minority members of the legislative committees with 11.8jurisdiction over taxes, in compliance with sections 3.195 and 3.197. The report must 11.9provide information on the number and dollar amount of homeowner property tax refund 11.10claims based on taxes payable in 2014, including:11.11    (1) the number and dollar amount of claims projected for homestead credit refunds 11.12based on taxes payable in 2014 prior to enactment of the notification requirement in 11.13this section;11.14    (2) the number of notifications issued as provided in this section, including the 11.15number issued by county;11.16    (3) preliminary information on the number and dollar amount of claims for 11.17homestead credit refunds based on taxes payable in 2014; and11.18    (4) a description of any outreach efforts undertaken by the commissioner for 11.19homestead credit refunds based on taxes payable in 2014, in addition to the notification 11.20required in this section.11.21    (b) By February 1, 2016, the commissioner must provide a written report to the chairs 11.22and ranking minority members of the legislative committees with jurisdiction over taxes, 11.23in compliance with sections 3.195 and 3.197. The report must include the information 11.24required in paragraph (a) and must also include final information on the number and dollar 11.25amount of claims for homestead credit refunds based on taxes payable in 2014.11.26EFFECTIVE DATE.This section is effective for refund claims based on property 11.27taxes payable in 2014.11.28ARTICLE 211.29PROPERTY TAX AIDS AND CREDITS11.30    Section 1. Minnesota Statutes 2012, section 273.1398, subdivision 4, is amended to read:11.31    Subd. 4. Disparity reduction credit. (a) Beginning with taxes payable in 1989, 11.32class 4a and class 3a property qualifies for a disparity reduction credit if: (1) the property 11.33is located in a border city that has an enterprise zone, as defined in section 
         469.166; (2) 11.34the property is located in a city with a population greater than 2,500 and less than 35,000 11.35according to the 1980 decennial census; (3) the city is adjacent to a city in another state or 12.1immediately adjacent to a city adjacent to a city in another state; and (4) the adjacent city 12.2in the other state has a population of greater than 5,000 and less than 75,000 according to 12.3the 1980 decennial census.12.4    (b) The credit is an amount sufficient to reduce (i) the taxes levied on class 4a 12.5property to 2.3 1.9 percent of the property's market value and (ii) the tax on class 3a 12.6property to 2.3 1.9 percent of market value.12.7    (c) The county auditor shall annually certify the costs of the credits to the 12.8Department of Revenue. The department shall reimburse local governments for the 12.9property taxes forgone as the result of the credits in proportion to their total levies.12.10EFFECTIVE DATE.This section is effective beginning with taxes payable in 2014.12.11    Sec. 2. Minnesota Statutes 2012, section 290C.02, subdivision 6, is amended to read:12.12    Subd. 6. Forest land. "Forest land" means land containing a minimum of 20 12.13contiguous acres for which the owner has implemented a forest management plan that was 12.14prepared or updated within the past ten years by an approved plan writer. For purposes of 12.15this subdivision, acres are considered to be contiguous even if they are separated by a road, 12.16waterway, railroad track, or other similar intervening property. At least 50 percent of the 12.17contiguous acreage must meet the definition of forest land in section 
         88.01, subdivision 12.187
         . For the purposes of sections 
         290C.01 to 
         290C.11, forest land does not include (i) 12.19land used for residential or agricultural purposes, (ii) land enrolled in the reinvest in 12.20Minnesota program, a state or federal conservation reserve or easement reserve program 12.21under sections 
         103F.501 to 
         103F.531, the Minnesota agricultural property tax law under 12.22section 
         273.111, or land subject to agricultural land preservation controls or restrictions 12.23as defined in section 
         40A.02 or under the Metropolitan Agricultural Preserves Act under 12.24chapter 473H, or (iii) land exceeding 60,000 acres that is subject to a single conservation 12.25easement funded under section 97A.056 or a comparable permanent easement conveyed 12.26to a governmental or nonprofit entity; (iv) any land that becomes subject to a conservation 12.27easement funded under section 97A.056 or a comparable permanent easement conveyed 12.28to a governmental or nonprofit entity after May 30, 2013; or (v) land improved with a 12.29structure, pavement, sewer, campsite, or any road, other than a township road, used for 12.30purposes not prescribed in the forest management plan.12.31EFFECTIVE DATE.This section is effective for certifications and applications 12.32due in 2013 and thereafter.12.33    Sec. 3. Minnesota Statutes 2012, section 290C.03, is amended to read:13.1290C.03 ELIGIBILITY REQUIREMENTS.13.2(a) Land may be enrolled in the sustainable forest incentive program under this 13.3chapter if all of the following conditions are met:13.4(1) the land consists of at least 20 contiguous acres and at least 50 percent of the 13.5land must meet the definition of forest land in section 
         88.01, subdivision 7, during the 13.6enrollment;13.7(2) a forest management plan for the land must be prepared by an approved plan 13.8writer and implemented during the period in which the land is enrolled;13.9(3) timber harvesting and forest management guidelines must be used in conjunction 13.10with any timber harvesting or forest management activities conducted on the land during 13.11the period in which the land is enrolled;13.12(4) the land must be enrolled for a minimum of eight years;13.13(5) there are no delinquent property taxes on the land; and13.14(6) claimants enrolling more than 1,920 acres in the sustainable forest incentive 13.15program must allow year-round, nonmotorized access to fish and wildlife resources and 13.16motorized access on established and maintained roads and trails, unless the road or trail is 13.17temporarily closed for safety, natural resource, or road damage reasons on enrolled land 13.18except within one-fourth mile of a permanent dwelling or during periods of high fire 13.19hazard as determined by the commissioner of natural resources.13.20(b) Claimants required to allow access under paragraph (a), clause (6), do not by 13.21that action:13.22(1) extend any assurance that the land is safe for any purpose;13.23(2) confer upon the person the legal status of an invitee or licensee to whom a duty 13.24of care is owed; or13.25(3) assume responsibility for or incur liability for any injury to the person or property 13.26caused by an act or omission of the person.13.27EFFECTIVE DATE.This section is effective for calculations made in 2013 and 13.28thereafter.13.29    Sec. 4. Minnesota Statutes 2012, section 290C.055, is amended to read:13.30290C.055 LENGTH OF COVENANT.13.31(a) The covenant remains in effect for a minimum of eight years. If land is removed 13.32from the program before it has been enrolled for four years, the covenant remains in 13.33effect for eight years from the date recorded.14.1(b) If land that has been enrolled for four years or more is removed from the program 14.2for any reason, there is a waiting period before the covenant terminates. The covenant 14.3terminates on January 1 of the fifth calendar year that begins after the date that:14.4(1) the commissioner receives notification from the claimant that the claimant wishes 14.5to remove the land from the program under section 
         290C.10; or14.6(2) the date that the land is removed from the program under section 
         290C.11.14.7(c) Notwithstanding the other provisions of this section, the covenant is terminated:14.8(1) at the same time that the land is removed from the program due to acquisition of 14.9title or possession for a public purpose under section 
         290C.10; or14.10(2) at the request of the claimant after a reduction in payments due to changes in the 14.11payment formula under section 290C.07.14.12EFFECTIVE DATE.This section is effective for calculations made in 2013 and 14.13thereafter.14.14    Sec. 5. Minnesota Statutes 2012, section 290C.07, is amended to read:14.15290C.07 CALCULATION OF INCENTIVE PAYMENT.14.16    (a) An approved claimant under the sustainable forest incentive program is eligible 14.17to receive an annual payment. The payment shall equal $7 per acre for each acre enrolled 14.18in the sustainable forest incentive program.14.19(b) The annual payment for each Social Security number or state or federal business 14.20tax identification number must not exceed $100,000.14.21EFFECTIVE DATE.This section is effective for calculations made in 2013 and 14.22thereafter.14.23    Sec. 6. [423A.022] POLICE AND FIREFIGHTER RETIREMENT 14.24SUPPLEMENTAL STATE AID.14.25    Subdivision 1.Supplemental state aid.Annually, the commissioner of revenue 14.26shall allocate police and firefighter retirement supplemental state aid appropriated under 14.27subdivision 6 as provided in subdivision 2 and paid as provided in subdivision 4.14.28    Subd. 2.Allocation.Of the total amount appropriated as supplemental state aid:14.29    (1) 58.065 percent must be paid to the executive director of the Public Employees 14.30Retirement Association for deposit in the public employees police and fire retirement fund 14.31established by section 353.65, subdivision 1;14.32    (2) 35.484 percent must be paid to municipalities other than municipalities solely 14.33employing firefighters with retirement coverage provided by the public employees police 15.1and fire retirement plan which qualified to receive fire state aid in that calendar year, 15.2allocated in proportion to the most recent amount of fire state aid paid under section 15.369.021, subdivision 7, for the municipality bears to the most recent total fire state aid 15.4for all municipalities other than the municipalities solely employing firefighters with 15.5retirement coverage provided by the public employees police and fire retirement plan 15.6paid under section 69.021, subdivision 7, with the allocated amount for fire departments 15.7participating in the voluntary statewide lump-sum volunteer firefighter retirement plan 15.8paid to the executive director of the Public Employees Retirement Association for deposit 15.9in the fund established by section 353G.02, subdivision 3, and credited to the respective 15.10account and with the balance paid to the treasurer of each municipality for transmittal 15.11within 30 days of receipt to the treasurer of the applicable volunteer firefighter relief 15.12association for deposit in its special fund; and15.13    (3) 6.452 percent must be paid to the executive director of the Minnesota State 15.14Retirement System for deposit in the state patrol retirement fund.15.15    Subd. 3.Reporting; definitions.(a) On or before September 1, annually, the 15.16executive director of the Public Employees Retirement Association shall report to the 15.17commissioner of revenue the following:15.18    (1) the municipalities which employ firefighters with retirement coverage by the 15.19public employees police and fire retirement plan;15.20    (2) the number of firefighters with public employees police and fire retirement plan 15.21coverage employed by each municipality;15.22    (3) the fire departments covered by the voluntary statewide lump-sum volunteer 15.23firefighter retirement plan; and15.24    (4) any other information requested by the commissioner to administer the police 15.25and firefighter retirement supplemental state aid program.15.26    (b) For this subdivision, (i) the number of firefighters employed by a municipality 15.27who have public employees police and fire retirement plan coverage means the number 15.28of firefighters with public employees police and fire retirement plan coverage that were 15.29employed by the municipality for not less than 30 hours per week for a minimum of six 15.30months prior to December 31 preceding the date of the payment under this section and, if 15.31the person was employed for less than the full year, prorated to the number of full months 15.32employed; and (ii) the number of active police officers certified for police state aid receipt 15.33under section 69.011, subdivisions 2 and 2b, means, for each municipality, the number of 15.34police officers meeting the definition of peace officer in section 69.011, subdivision 1, 15.35counted as provided and limited by section 69.011, subdivisions 2 and 2b.16.1    Subd. 4.Payments; conditions prerequisite.(a) The payments under this section 16.2must be made on October 1 each year, with interest at one percent for each month, or 16.3portion of a month, that the amount remains unpaid after October 1. Any necessary 16.4adjustments must be made to subsequent payments.16.5    (b) The provisions of sections 69.011 to 69.051 that prevent municipalities and relief 16.6associations from being eligible for, or receiving fire state aid under sections 69.011 to 16.769.051 until the applicable financial reporting requirements have been complied with, 16.8apply to the amounts payable to municipalities and relief associations under this section.16.9    Subd. 5.Aid termination.The aid program under this section ends on the 16.10December 1 next following the actuarial valuation date on which the assets of the 16.11retirement plan on a market value basis equals or exceeds 90 percent of the total 16.12actuarial accrued liabilities of the retirement plan as disclosed in an actuarial valuation 16.13prepared under section 356.215 and the Standards for Actuarial Work promulgated by the 16.14Legislative Commission on Pensions and Retirement, for the State Patrol retirement plan 16.15or the public employees police and fire retirement plan, whichever occurs last.16.16    Subd. 6.Appropriation.$15,500,000 is appropriated annually to the commissioner 16.17of revenue for this aid program.16.18EFFECTIVE DATE.This section is effective beginning in the fiscal year beginning 16.19July 1, 2013.16.20    Sec. 7. Minnesota Statutes 2012, section 477A.011, subdivision 30, is amended to read:16.21    Subd. 30. Pre-1940 housing percentage.(a) Except as provided in paragraph (b), 16.22"pre-1940 housing percentage" for a city is 100 times the most recent federal census count 16.23by the United States Bureau of the Census of all housing units in the city built before 16.241940, divided by the total number of all housing units in the city. Housing units includes 16.25both occupied and vacant housing units as defined by the federal census. For aids payable 16.26in 2014, "pre-1940 housing percentage" shall be based on 2010 housing data.16.27    (b) For the city of East Grand Forks only, "pre-1940 housing percentage" is equal 16.28to 100 times the 1990 federal census count of all housing units in the city built before 16.291940, divided by the most recent count by the United States Bureau of the Census of all 16.30housing units in the city. Housing units includes both occupied and vacant housing units 16.31as defined by the federal census.16.32EFFECTIVE DATE.This section is effective for aids payable in calendar year 16.332014 and thereafter.17.1    Sec. 8. Minnesota Statutes 2012, section 477A.011, is amended by adding a 17.2subdivision to read:17.3    Subd. 30a.Percent of housing built between 1940 and 1970."Percent of housing 17.4built between 1940 and 1970" is equal to 100 times the most recent count by the United 17.5States Bureau of the Census of all housing units in the city built after 1939 but before 17.61970, divided by the total number of all housing units in the city. Housing units includes 17.7both occupied and vacant housing units as defined by the federal census. For aids payable 17.8in 2014, "percent of housing built between 1940 and 1970" shall be based on 2010 17.9housing data.17.10EFFECTIVE DATE.This section is effective for aids payable in calendar year 17.112014 and thereafter.17.12    Sec. 9. Minnesota Statutes 2012, section 477A.011, subdivision 34, is amended to read:17.13    Subd. 34. City revenue need. (a) For a city with a population equal to or greater 17.14than 2,500 10,000, "city revenue need" is the greater of 285 or 1.15 times the sum of (1) 17.155.0734098 4.59 times the pre-1940 housing percentage; plus (2) 19.141678 times the 17.16population decline percentage 0.622 times the percent of housing built between 1940 and 17.171970; plus (3) 2504.06334 times the road accidents factor 169.415 times the jobs per 17.18capita; plus (4) 355.0547; minus (5) the metropolitan area factor; minus (6) 49.10638 17.19times the household size the sparsity adjustment; plus (5) 307.664.17.20    (b) For a city with a population equal to or greater than 2,500 and less than 10,000, 17.21"city revenue need" is 1.15 times the sum of (1) 572.62; plus (2) 5.026 times the pre-1940 17.22housing percentage; minus (3) 53.768 times household size; plus (4) 14.022 times peak 17.23population decline.17.24    (b) (c) For a city with a population less than 2,500, "city revenue need" is the sum of 17.25(1) 2.387 times the pre-1940 housing percentage; plus (2) 2.67591 times the commercial 17.26industrial percentage; plus (3) 3.16042 times the population decline percentage; plus (4) 17.271.206 times the transformed population; minus (5) 62.772 410 plus 0.367 times the city's 17.28population over 100. The city revenue need under this paragraph shall not exceed 630.17.29    (c) (d) For a city with a population of at least 2,500 or more and a population in one 17.30of the most recently available five years that was less than 2,500, "city revenue need" 17.31is the sum of (1) its city revenue need calculated under paragraph (a) multiplied by its 17.32transition factor; plus (2) its city revenue need calculated under the formula in paragraph 17.33(b) multiplied by the difference between one and its transition factor. For purposes of this 17.34paragraph, a city's "transition factor" is equal to 0.2 multiplied by the number of years that 17.35the city's population estimate has been 2,500 or more. This provision only applies for aids 18.1payable in calendar years 2006 to 2008 to cities with a 2002 population of less than 2,500. 18.2It applies to any city for aids payable in 2009 and thereafter but less than 3,000, the "city 18.3revenue need" equals (1) the transition factor times the city's revenue need calculated in 18.4paragraph (b) plus (2) 630 times the difference between one and the transition factor. For 18.5a city with a population of at least 10,000 but less than 10,500, the "city revenue need" 18.6equals (1) the transition factor times the city's revenue need calculated in paragraph (a) 18.7plus (2) the city's revenue need calculated under the formula in paragraph (b) times the 18.8difference between one and the transition factor. For purposes of this paragraph "transition 18.9factor" is 0.2 percent times the amount that the city's population exceeds the minimum 18.10threshold in either of the first two sentences.18.11    (d) (e) The city revenue need cannot be less than zero.18.12    (e) (f) For calendar year 2005 2015 and subsequent years, the city revenue need for 18.13a city, as determined in paragraphs (a) to (d) (e), is multiplied by the ratio of the annual 18.14implicit price deflator for government consumption expenditures and gross investment for 18.15state and local governments as prepared by the United States Department of Commerce, 18.16for the most recently available year to the 2003 2013 implicit price deflator for state 18.17and local government purchases.18.18EFFECTIVE DATE.This section is effective for aids payable in calendar year 18.192014 and thereafter.18.20    Sec. 10. Minnesota Statutes 2012, section 477A.011, subdivision 42, is amended to read:18.21    Subd. 42. City jobs base Jobs per capita.(a) "City jobs base" for a city with a 18.22population of 5,000 or more is equal to the product of (1) $25.20, (2) the number of 18.23jobs per capita in the city, and (3) its population. For cities with a population less than 18.245,000, the city jobs base is equal to zero. For a city receiving aid under subdivision 36, 18.25paragraph (k), its city jobs base is reduced by the lesser of 36 percent of the amount of 18.26aid received under that paragraph or $1,000,000. No city's city jobs base may exceed 18.27$4,725,000 under this paragraph.18.28    (b) For calendar year 2010 and subsequent years, the city jobs base for a city, as 18.29determined in paragraph (a), is multiplied by the ratio of the appropriation under section 18.30477A.03, subdivision 2a, for the year in which the aid is paid to the appropriation under 18.31that section for aids payable in 2009.18.32    (c) For purposes of this subdivision, "Jobs per capita in the city" means (1) the 18.33average annual number of employees in the city based on the data from the Quarterly 18.34Census of Employment and Wages, as reported by the Department of Employment and 18.35Economic Development, for the most recent calendar year available as of May 1, 200819.1 November 1 of every odd-numbered year, divided by (2) the city's population for the 19.2same calendar year as the employment data. The commissioner of the Department of 19.3Employment and Economic Development shall certify to the city the average annual 19.4number of employees for each city by June 1, 2008 January 1, of every even-numbered 19.5year beginning with January 1, 2014. A city may challenge an estimate under this 19.6paragraph by filing its specific objection, including the names of employers that it feels 19.7may have misreported data, in writing with the commissioner by June 20, 2008 December 19.81 of every odd-numbered year. The commissioner shall make every reasonable effort 19.9to address the specific objection and adjust the data as necessary. The commissioner 19.10shall certify the estimates of the annual employment to the commissioner of revenue by 19.11July 15, 2008 January 1 of all even-numbered years, including any estimates still under 19.12objection. For aids payable in 2014, "jobs per capita" shall be based on the annual number 19.13of employees and population for calendar year 2010 without additional review.19.14EFFECTIVE DATE.This section is effective for aids payable in calendar year 19.152014 and thereafter.19.16    Sec. 11. Minnesota Statutes 2012, section 477A.011, is amended by adding a 19.17subdivision to read:19.18    Subd. 44.Peak population decline."Peak population decline" is equal to 100 19.19times the difference between one and the ratio of the city's current population, to the 19.20highest city population reported in a federal census from the 1970 census or later. "Peak 19.21population decline" shall not be less than zero.19.22EFFECTIVE DATE.This section is effective for aids payable in calendar year 19.232014 and thereafter.19.24    Sec. 12. Minnesota Statutes 2012, section 477A.011, is amended by adding a 19.25subdivision to read:19.26    Subd. 45.Sparsity adjustment.For a city with a population of 10,000 or more, the 19.27sparsity adjustment is 100 for any city with an average population density less than 150 19.28per square mile, according to the most recent federal census, and the sparsity adjustment is 19.29zero for all other cities.19.30EFFECTIVE DATE.This section is effective for aids payable in calendar year 19.312014 and thereafter.19.32    Sec. 13. Minnesota Statutes 2012, section 477A.013, subdivision 1, is amended to read:20.1    Subdivision 1. Towns.In 2002, no town is eligible for a distribution under this 20.2subdivision. In 2014 and thereafter, each town is eligible for a distribution under this 20.3subdivision equal to the product of (i) its agricultural property factor, (ii) its town area 20.4factor, (iii) its population factor, and (iv) 0.0045. As used in this subdivision, the following 20.5terms have the meanings given them:20.6(1) "agricultural property factor" means the ratio of the adjusted net tax capacity of 20.7agricultural property located in a town, divided by the adjusted net tax capacity of all other 20.8property located in the town. The agricultural property factor cannot exceed eight;20.9(2) "agricultural property" means property classified under section 273.13, as 20.10homestead and nonhomestead agricultural property, rural vacant land, and noncommercial 20.11seasonal recreational property;20.12(3) "town area factor" means the most recent estimate of total acreage, not to exceed 20.1350,000 acres, located in the township available as of July 1 in the aid calculation year, 20.14estimated or established by:20.15(i) the United States Bureau of the Census;20.16(ii) the State Land Management Information Center; or20.17(iii) the secretary of state; and20.18(4) "population factor" means the square root of the towns' population.20.19If the sum of the aids payable to all towns under this subdivision exceeds the limit 20.20under section 477A.03, subdivision 2c, the distribution to each town must be reduced 20.21proportionately so that the total amount of aids distributed under this section does not 20.22exceed the limit in section 477A.03, subdivision 2c.20.23EFFECTIVE DATE.This section is effective for aids payable in calendar year 20.242014 and thereafter.20.25    Sec. 14. Minnesota Statutes 2012, section 477A.013, subdivision 8, is amended to read:20.26    Subd. 8. City formula aid.(a) For aids payable in 2014 only, the formula aid for a 20.27city is equal to the sum of (1) its 2013 certified aid and (2) the product of (i) the difference 20.28between its unmet need and its 2013 certified aid and (ii) the aid gap percentage.20.29    (b) For aids payable in 2015 and thereafter, the formula aid for a city is equal to 20.30the sum of (1) its city jobs base, (2) its small city aid base, and (3) the need increase 20.31percentage multiplied by the average of its unmet need for the most recently available two 20.32years formula aid in the previous year and (2) the product of (i) the difference between 20.33its unmet need and its certified aid in the previous year under subdivision 9, and (ii) 20.34the aid gap percentage.21.1No city may have a formula aid amount less than zero. The need increase aid gap21.2 percentage must be the same for all cities.21.3    The applicable need increase aid gap percentage must be calculated by the 21.4Department of Revenue so that the total of the aid under subdivision 9 equals the total 21.5amount available for aid under section 
         477A.03. Data used in calculating aids to cities 21.6under sections 
         477A.011 to 
         477A.013 shall be the most recently available data as of 21.7January 1 in the year in which the aid is calculated except that the data used to compute "net 21.8levy" in subdivision 9 is the data most recently available at the time of the aid computation.21.9EFFECTIVE DATE.This section is effective for aids payable in calendar year 21.102014 and thereafter.21.11    Sec. 15. Minnesota Statutes 2012, section 477A.013, subdivision 9, is amended to read:21.12    Subd. 9. City aid distribution. (a) In calendar year 2013 2014 and thereafter, each 21.13city shall receive an aid distribution equal to the sum of (1) the city formula aid under 21.14subdivision 8, and (2) its city aid base aid adjustment under subdivision 13.21.15    (b) For aids payable in 2013 and 2014 only, the total aid in the previous year for 21.16any city shall mean the amount of aid it was certified to receive for aids payable in 2012 21.17under this section. For aids payable in 2015 and thereafter, the total aid in the previous 21.18year for any city means the amount of aid it was certified to receive under this section in 21.19the previous payable year.21.20    (c) For aids payable in 2010 and thereafter, the total aid for any city shall not exceed 21.21the sum of (1) ten percent of the city's net levy for the year prior to the aid distribution 21.22plus (2) its total aid in the previous year. For aids payable in 2009 and thereafter, the total 21.23aid for any city with a population of 2,500 or more may not be less than its total aid under 21.24this section in the previous year minus the lesser of $10 multiplied by its population, or ten 21.25percent of its net levy in the year prior to the aid distribution.21.26    (d) (b) For aids payable in 2014 only, the total aid for a city may not be less than the 21.27amount it was certified to receive in 2013. For aids payable in 2010 2015 and thereafter, 21.28the total aid for a city with a population less than 2,500 must not be less than the amount 21.29it was certified to receive in the previous year minus the lesser of $10 multiplied by its 21.30population, or five percent of its 2003 certified aid amount. For aids payable in 2009 only, 21.31the total aid for a city with a population less than 2,500 must not be less than what it 21.32received under this section in the previous year unless its total aid in calendar year 2008 21.33was aid under section 477A.011, subdivision 36, paragraph (s), in which case its minimum 21.34aid is zero its net levy in the year prior to the aid distribution.22.1    (e) A city's aid loss under this section may not exceed $300,000 in any year in 22.2which the total city aid appropriation under section 477A.03, subdivision 2a, is equal or 22.3greater than the appropriation under that subdivision in the previous year, unless the 22.4city has an adjustment in its city net tax capacity under the process described in section 22.5469.174, subdivision 28.22.6    (f) If a city's net tax capacity used in calculating aid under this section has decreased 22.7in any year by more than 25 percent from its net tax capacity in the previous year due to 22.8property becoming tax-exempt Indian land, the city's maximum allowed aid increase 22.9under paragraph (c) shall be increased by an amount equal to (1) the city's tax rate in the 22.10year of the aid calculation, multiplied by (2) the amount of its net tax capacity decrease 22.11resulting from the property becoming tax exempt.22.12EFFECTIVE DATE.This section is effective for aids payable in calendar year 22.132014 and thereafter.22.14    Sec. 16. Minnesota Statutes 2012, section 477A.013, is amended by adding a 22.15subdivision to read:22.16    Subd. 13.Certified aid adjustments.(a) A city that received an aid base increase 22.17under Minnesota Statutes 2012, section 477A.011, subdivision 36, paragraph (e), shall 22.18have its total aid under subdivision 9 increased by an amount equal to $150,000 for aids 22.19payable in 2014 through 2018.22.20(b) A city that received an aid base increase under section 477A.011, subdivision 36, 22.21paragraph (r), shall have its total aid under subdivision 9 increased by an amount equal to 22.22$160,000 for aids payable in 2014 and thereafter.22.23(c) A city that received a temporary aid increase under Minnesota Statutes 2012, 22.24section 477A.011, subdivision 36, paragraph (o), shall have its total aid under subdivision 22.259 increased by an amount equal to $1,000,000 for aids payable in 2014 only.22.26    Sec. 17. Minnesota Statutes 2012, section 477A.015, is amended to read:22.27477A.015 PAYMENT DATES.22.28The commissioner of revenue shall make the payments of local government aid to 22.29affected taxing authorities in two installments on July 20 and December 26 annually.22.30When the commissioner of public safety determines that a local government has 22.31suffered financial hardship due to a natural disaster, the commissioner of public safety 22.32shall notify the commissioner of revenue, who shall make payments of aids under sections 23.1477A.011
          to 
         477A.014, which are otherwise due on December 26, as soon as is practical 23.2after the determination is made but not before July 20.23.3The commissioner may pay all or part of the payments of aids under sections 23.4477A.011
          to 
         477A.014, which are due on December 26 at any time after August 15 if a 23.5local government requests such payment as being necessary for meeting its cash flow 23.6needs. For aids payable in 2013 only, a city that is located in an area deemed a disaster 23.7area during the month of April 2013, as defined in section 12A.02, subdivision 5, shall 23.8receive its December 26, 2013 payment with its July 20, 2013 payment.23.9EFFECTIVE DATE.This section is effective for aids payable in calendar year 23.102013 and thereafter.23.11    Sec. 18. Minnesota Statutes 2012, section 477A.03, subdivision 2a, is amended to read:23.12    Subd. 2a. Cities. For aids payable in 2013 2014and thereafter, the total aid paid 23.13under section 
         477A.013, subdivision 9, is $426,438,012 $507,598,012. The total aid paid 23.14under section 477A.013, subdivision 9, is $509,098,012 for aids payable in 2015. For aids 23.15payable in 2016 and thereafter, the total aid paid under section 477A.013, subdivision 23.169, is $511,598,012.23.17EFFECTIVE DATE.This section is effective for aids payable in calendar year 23.182014 and thereafter.23.19    Sec. 19. Minnesota Statutes 2012, section 477A.03, subdivision 2b, is amended to read:23.20    Subd. 2b. Counties. (a) For aids payable in 2013 2014 and thereafter, the total aid 23.21payable under section 
         477A.0124, subdivision 3, is $80,795,000 $100,795,000. Each 23.22calendar year, $500,000 of this appropriation shall be retained by the commissioner 23.23of revenue to make reimbursements to the commissioner of management and budget 23.24for payments made under section 
         611.27. For calendar year 2004, the amount shall 23.25be in addition to the payments authorized under section 477A.0124, subdivision 1. 23.26For calendar year 2005 and subsequent years, the amount shall be deducted from the 23.27appropriation under this paragraph. The reimbursements shall be to defray the additional 23.28costs associated with court-ordered counsel under section 
         611.27. Any retained amounts 23.29not used for reimbursement in a year shall be included in the next distribution of county 23.30need aid that is certified to the county auditors for the purpose of property tax reduction 23.31for the next taxes payable year.23.32    (b) For aids payable in 2013 2014 and thereafter, the total aid under section 23.33477A.0124, subdivision 4
         , is $84,909,575 $104,909,575. The commissioner of 24.1management and budget shall bill the commissioner of revenue shall transfer to the 24.2commissioner of management and budget $207,000 annually for the cost of preparation 24.3of local impact notes as required by section 
         3.987, not to exceed $207,000 in fiscal year 24.42004 and thereafter and other local government activities. The commissioner of education 24.5shall bill the commissioner of revenue for the cost of preparation of local impact notes for 24.6school districts as required by section 3.987, not to exceed $7,000 in fiscal year 2004 and 24.7thereafter shall transfer to the commissioner of education $7,000 annually for the cost of 24.8preparation of local impact notes for school districts as required by section 3.987. The 24.9commissioner of revenue shall deduct the amounts billed transferred under this paragraph 24.10from the appropriation under this paragraph. The amounts deducted transferred are 24.11appropriated to the commissioner of management and budget and the commissioner of 24.12education for the preparation of local impact notes respectively.24.13EFFECTIVE DATE.This section is effective for aid payable in 2014 and thereafter.24.14    Sec. 20. Minnesota Statutes 2012, section 477A.03, is amended by adding a 24.15subdivision to read:24.16    Subd. 2c.Towns.For aids payable in 2014, the total aids paid under section 24.17477A.013, subdivision 1, is limited to $10,000,000. For aids payable in 2015 and 24.18thereafter, the total aids paid under section 477A.013, subdivision 1, is limited to the 24.19amount certified to be paid in the previous year.24.20EFFECTIVE DATE.This section is effective for aids payable in calendar year 24.212014 and thereafter.24.22    Sec. 21. [477A.085] DEBT SERVICE AID; CITY OF MINNEAPOLIS.24.23On or before November 1, 2016, and the first day of each November thereafter, the 24.24commissioner shall pay to the city of Minneapolis an amount equal to 40 percent of the 24.25city's otherwise required levy to pay its general obligation library referendum bonds for 24.26the following calendar year. The levy excludes any amount to pay bonds, other than 24.27refunding bonds, issued after May 1, 2013. An amount sufficient to pay the aid under this 24.28section is appropriated from the general fund to the commissioner of revenue.24.29    Sec. 22. [477A.10] NATURAL RESOURCES LAND PAYMENTS IN LIEU; 24.30PURPOSE.24.31The purposes of sections 477A.11 to 477A.14 are:25.1(1) to compensate local units of government for the loss of tax base from state 25.2ownership of land and the need to provide services for state land;25.3(2) to address the disproportionate impact of state land ownership on local units of 25.4government with a large proportion of state land; and25.5(3) to address the need to manage state lands held in trust for the local taxing districts.25.6    Sec. 23. Minnesota Statutes 2012, section 477A.11, subdivision 3, is amended to read:25.7    Subd. 3. Acquired natural resources land. "Acquired natural resources land" 25.8means:25.9(1) any land, other than wildlife management land, presently administered by the 25.10commissioner in which the state acquired by purchase, condemnation, or gift, a fee title 25.11interest in lands which were previously privately owned; and25.12(2) lands acquired by the state under chapter 84A that are designated as state parks, 25.13state recreation areas, scientific and natural areas, or wildlife management areas.25.14EFFECTIVE DATE.This section is effective for aids payable in calendar year 25.152013 and thereafter.25.16    Sec. 24. Minnesota Statutes 2012, section 477A.11, subdivision 4, is amended to read:25.17    Subd. 4. Other natural resources land. "Other natural resources land" means 25.18any other land, other than acquired natural resource land or wildlife management land,25.19 presently owned in fee title by the state and administered by the commissioner, or 25.20any tax-forfeited land, other than platted lots within a city or those lands described 25.21under subdivision 3, clause (2), which is owned by the state and administered by the 25.22commissioner or by the county in which it is located.25.23EFFECTIVE DATE.This section is effective for aids payable in calendar year 25.242013 and thereafter.25.25    Sec. 25. Minnesota Statutes 2012, section 477A.11, is amended by adding a 25.26subdivision to read:25.27    Subd. 6.Military game refuge."Military game refuge" means land owned in 25.28fee by another state agency for military purposes and designated as a state game refuge 25.29under section 97A.085.25.30EFFECTIVE DATE.This section is effective for aids payable in calendar year 25.312013 and thereafter.26.1    Sec. 26. Minnesota Statutes 2012, section 477A.11, is amended by adding a 26.2subdivision to read:26.3    Subd. 7.Transportation wetland."Transportation wetland" means land 26.4administered by the Department of Transportation in which the state acquired, by purchase 26.5from a private owner, a fee title interest in over 500 acres of land within a county to 26.6replace wetland losses from transportation projects.26.7EFFECTIVE DATE.This section is effective for aids payable in calendar year 26.82013 and thereafter.26.9    Sec. 27. Minnesota Statutes 2012, section 477A.11, is amended by adding a 26.10subdivision to read:26.11    Subd. 8.Wildlife management land."Wildlife management land" means land 26.12administered by the commissioner in which the state acquired, from a private owner by 26.13purchase, condemnation, or gift, a fee interest under the authority granted in chapter 94 or 26.1497A for wildlife management purposes and actually used as a wildlife management area.26.15EFFECTIVE DATE.This section is effective for aids payable in calendar year 26.162013 and thereafter.26.17    Sec. 28. Minnesota Statutes 2012, section 477A.12, subdivision 1, is amended to read:26.18    Subdivision 1. Types of land; payments.(a) As an offset for expenses incurred 26.19by counties and towns in support of natural resources lands, The following amounts are 26.20annually appropriated to the commissioner of natural resources from the general fund for 26.21transfer to the commissioner of revenue. The commissioner of revenue shall pay the 26.22transferred funds to counties as required by sections 
         477A.11 to 
         477A.14. The amounts, 26.23based on the acreage as of July 1 of each year prior to the payment year, are:26.24(1) for acquired natural resources land, $5.133 multiplied by the total number of acres 26.25of acquired natural resources land or, at the county's option three-fourths of one percent of 26.26the appraised value of all acquired natural resources land in the county, whichever is greater;26.27(2) $5.133, multiplied by the total number of acres of transportation wetland or, at 26.28the county's option, three-fourths of one percent of the appraised value of all acquired 26.29natural resources land in the county, whichever is greater;26.30(3) three-fourths of one percent of the appraised value of all wildlife management 26.31land in the county;26.32(4) 50 percent of the dollar amount as determined under clause (1), multiplied by 26.33the number of acres of military refuge land in the county;27.1$1.283 (5) $1.50,  multiplied by the number of acres of county-administered other 27.2natural resources land in the county;27.3(3) $1.283 (6) $5.133,  multiplied by the total number of acres of land utilization 27.4project land in the county; and27.5(4) 64.2 cents (7) $1.50,  multiplied by the number of acres of 27.6commissioner-administered other natural resources land located in each the county as of 27.7July 1 of each year prior to the payment year.; and27.8    (8) without regard to acreage, $300,000 for local assessments under section 84A.55, 27.9subdivision 9.27.10(b) The amount determined under paragraph (a), clause (1), is payable for land 27.11that is acquired from a private owner and owned by the Department of Transportation 27.12for the purpose of replacing wetland losses caused by transportation projects, but only 27.13if the county contains more than 500 acres of such land at the time the certification is 27.14made under subdivision 2.27.15EFFECTIVE DATE.This section is effective for aids payable in calendar year 27.162013 and thereafter.27.17    Sec. 29. Minnesota Statutes 2012, section 477A.12, subdivision 2, is amended to read:27.18    Subd. 2. Procedure.Lands for which payments in lieu are made pursuant to 27.19section 97A.061, subdivision 3, and Laws 1973, chapter 567, shall not be eligible for 27.20payments under this section. Each county auditor shall certify to the Department of 27.21Natural Resources during July of each year prior to the payment year the number of acres 27.22of county-administered other natural resources land within the county. The Department of 27.23Natural resources may, in addition to the certification of acreage, require descriptive lists 27.24of land so certified. The commissioner of natural resources shall determine and certify to 27.25the commissioner of revenue by March 1 of the payment year:27.26(1) the number of acres and most recent appraised value of acquired natural 27.27resources land, wildlife management land, and military refuge land within each county;27.28(2) the number of acres of commissioner-administered natural resources land within 27.29each county;27.30(3) the number of acres of county-administered other natural resources land within 27.31each county, based on the reports filed by each county auditor with the commissioner 27.32of natural resources; and27.33(4) the number of acres of land utilization project land within each county.27.34The commissioner of transportation shall determine and certify to the commissioner 27.35of revenue by March 1 of the payment year the number of acres of land transportation 28.1wetland and the appraised value of the land described in subdivision 1, paragraph (b), but 28.2only if it exceeds 500 acres in a county.28.3The commissioner of revenue shall determine the distributions provided for in this 28.4section using the number of acres and appraised values certified by the commissioner of 28.5natural resources and the commissioner of transportation by March 1 of the payment year.28.6EFFECTIVE DATE.This section is effective for aids payable in calendar year 28.72013 and thereafter.28.8    Sec. 30. Minnesota Statutes 2012, section 477A.12, subdivision 3, is amended to read:28.9    Subd. 3. Determination of appraised value. For the purposes of this section, the 28.10appraised value of acquired natural resources land is the purchase price for the first five 28.11years after acquisition until the next six-year appraisal required under this subdivision. 28.12The appraised value of acquired natural resources land received as a donation is the value 28.13determined for the commissioner of natural resources by a licensed appraiser, or the 28.14county assessor's estimated market value if no appraisal is done. The appraised value must 28.15be determined by the county assessor every five six years after the land is acquired. All 28.16reappraisals shall be done in the same year as county assessors are required to assess 28.17exempt land under section 273.18.28.18EFFECTIVE DATE.This section is effective for aids payable in calendar year 28.192013 and thereafter.28.20    Sec. 31. Minnesota Statutes 2012, section 477A.14, subdivision 1, is amended to read:28.21    Subdivision 1. General distribution. Except as provided in subdivision 2 or in 28.22section 97A.061, subdivision 5 subdivisions 2 and 3, 40 percent of the total payment to 28.23the county shall be deposited in the county general revenue fund to be used to provide 28.24property tax levy reduction. The remainder shall be distributed by the county in the 28.25following priority:28.26(a) 64.2 cents,  for each acre of county-administered other natural resources land shall 28.27be deposited in a resource development fund to be created within the county treasury for 28.28use in resource development, forest management, game and fish habitat improvement, and 28.29recreational development and maintenance of county-administered other natural resources 28.30land. Any county receiving less than $5,000 annually for the resource development fund 28.31may elect to deposit that amount in the county general revenue fund;28.32(b) from the funds remaining, within 30 days of receipt of the payment to the county, 28.33the county treasurer shall pay each organized township 51.3 cents for each acre of acquired 29.1natural resources land and each acre of land described in section 477A.12, subdivision 1, 29.2paragraph (b), and 12.8 cents for each acre of other natural resources land and each acre of 29.3land utilization project land located within its boundaries ten percent of the amount received 29.4under section 477A.12, subdivision 1, clauses (1), (2), and (5) to (7). Payments for natural 29.5resources lands not located in an organized township shall be deposited in the county 29.6general revenue fund. Payments to counties and townships pursuant to this paragraph shall 29.7be used to provide property tax levy reduction, except that of the payments for natural 29.8resources lands not located in an organized township, the county may allocate the amount 29.9determined to be necessary for maintenance of roads in unorganized townships. Provided 29.10that, if the total payment to the county pursuant to section 
         477A.12 is not sufficient to fully 29.11fund the distribution provided for in this clause, the amount available shall be distributed 29.12to each township and the county general revenue fund on a pro rata basis; and29.13(c) any remaining funds shall be deposited in the county general revenue fund. 29.14Provided that, if the distribution to the county general revenue fund exceeds $35,000, the 29.15excess shall be used to provide property tax levy reduction.29.16EFFECTIVE DATE.This section is effective for aids payable in calendar year 29.172013 and thereafter.29.18    Sec. 32. Minnesota Statutes 2012, section 477A.14, is amended by adding a 29.19subdivision to read:29.20    Subd. 3.Distribution for wildlife management lands and military refuge lands.29.21(a) The county treasurer shall allocate the payment for wildlife management land and 29.22military game refuge land among the county, towns, and school districts on the same basis 29.23as if the payments were taxes on the land received in the year. Payment of a town's or a 29.24school district's allocation must be made by the county treasurer to the town or school 29.25district within 30 days of receipt of the payment to the county. The county's share of the 29.26payment shall be deposited in the county general revenue fund.29.27(b) The county treasurer of a county with a population over 39,000, but less than 29.2842,000, in the 1950 federal census shall allocate the payment only among the towns and 29.29school districts on the same basis as if the payments were taxes on the lands received 29.30in the current year.29.31(c) If a town received a payment in calendar year 2006 or thereafter under this 29.32subdivision, and subsequently incorporated as a city, the city shall continue to receive any 29.33future year's allocations of wildlife land payments that would have been made to the town 29.34had it not incorporated, provided that the payments shall terminate if the governing body 29.35of the city passes an ordinance that prohibits hunting within the boundaries of the city.30.1EFFECTIVE DATE.This section is effective for aids payable in calendar year 30.22013 and thereafter.30.3    Sec. 33. Laws 2006, chapter 259, article 11, section 3, as amended by Laws 2008, 30.4chapter 154, article 1, section 4, is amended to read:30.5    Sec. 3. MAHNOMEN COUNTY; COUNTY, CITY, SCHOOL DISTRICT, 30.6PROPERTY TAX REIMBURSEMENT.30.7    Subdivision 1.  Aid appropriation.$600,000 $1,200,000 is appropriated annually 30.8from the general fund to the commissioner of revenue to be used to make payments to 30.9compensate for the loss of property tax revenue related to the trust conversion application 30.10of the Shooting Star Casino. The commissioner shall pay the county of Mahnomen, 30.11$450,000 $900,000; the city of Mahnomen, $80,000 $160,000; and Independent School 30.12District No. 432, Mahnomen, $70,000 $140,000. The payments shall be made on July 20, 30.13of 2008 2013 and each subsequent year. 30.14EFFECTIVE DATE.This section is effective for aids payable in calendar year  30.152013 and thereafter.30.16    Sec. 34. INELIGIBILITY; SUSTAINABLE FOREST INCENTIVE PROGRAM.30.17Lands that no longer qualify as forest land under Minnesota Statutes, section 30.18290C.02, subdivision 6, item (iii), are released from the covenant required under 30.19Minnesota Statutes, section 290C.04.30.20EFFECTIVE DATE.This section is effective the day following final enactment.30.21    Sec. 35. REENROLLMENT; SUSTAINABLE FOREST INCENTIVE 30.22PROGRAM.30.23A person who elected to terminate participation in the sustainable forest incentive 30.24program, as provided in Laws 2011, First Special Session chapter 7, article 6, section 12, 30.25may reenroll lands for which the claimant terminated participation and be eligible for a 30.26payment in October 2013. A person must apply for reenrollment under this section within 30.2760 days after the effective date of this section.30.28EFFECTIVE DATE.This section is effective the day following final enactment.30.29    Sec. 36.  REPEALER.31.1(a) Minnesota Statutes 2012, sections 477A.011, subdivisions 2a, 19, 29, 31, 32, 33, 31.236, 39, 40, and 41; 477A.013, subdivisions 11 and 12; 477A.0133; and 477A.0134, are 31.3repealed.31.4(b) Minnesota Statutes 2012, section 97A.061, and Laws 1973, chapter 567, section 31.57, as amended by Laws 1977, chapter 403, section 12,  are repealed on July 1, 2013.31.6EFFECTIVE DATE.This section is effective for aids payable in calendar year 31.72014 and thereafter.31.8ARTICLE 331.9EDUCATION AIDS AND LEVIES31.10    Section 1. [124D.862] ACHIEVEMENT AND INTEGRATION REVENUE.31.11    Subdivision 1.Initial achievement and integration revenue.(a) An eligible 31.12district's initial achievement and integration revenue equals the sum of (1) $350 times 31.13the district's adjusted pupil units for that year times the ratio of the district's enrollment 31.14of protected students for the previous school year to total enrollment for the previous 31.15school year and (2) the greater of zero or 66 percent of the difference between the district's 31.16integration revenue for fiscal year 2013 and the district's integration revenue for fiscal 31.17year 2014 under clause (1).31.18(b) In each year, 0.3 percent of each district's initial achievement and integration 31.19revenue is transferred to the department for the oversight and accountability activities 31.20required under this section and section 124D.861.31.21    Subd. 2.Incentive revenue.An eligible school district's maximum incentive 31.22revenue equals $10 per adjusted pupil unit. In order to receive this revenue, a district must 31.23be implementing a voluntary plan to reduce racial and economic enrollment disparities 31.24through intradistrict and interdistrict activities that have been approved as a part of the 31.25district's achievement and integration plan.31.26    Subd. 3.Achievement and integration revenue.Achievement and integration 31.27revenue equals the sum of initial achievement and integration revenue and incentive 31.28revenue.31.29    Subd. 4.Achievement and integration aid.For fiscal year 2015 and later, 31.30a district's achievement and integration aid equals 70 percent of its achievement and 31.31integration revenue.31.32    Subd. 5.Achievement and integration levy.A district's achievement and 31.33integration levy equals its achievement and integration revenue times 30 percent. For 31.34Special School District No. 1, Minneapolis; Independent School District No. 625, St. 31.35Paul; and Independent School District No. 709, Duluth, 100 percent of the levy certified 32.1under this subdivision is shifted into the prior calendar year for purposes of sections 32.2123B.75, subdivision 5, and 127A.441.32.3    Subd. 6.Revenue uses.(a) At least 80 percent of a district's achievement and 32.4integration revenue received under this section must be used for innovative and integrated 32.5learning environments, school enrollment choices, family engagement activities, and other 32.6approved programs providing direct services to students.32.7(b) Up to 20 percent of the revenue may be used for professional development and 32.8staff development activities and placement services.32.9(c) No more than ten percent of the total amount of revenue may be spent on 32.10administrative services.32.11    Subd. 7.Revenue reserved.Integration revenue received under this section must 32.12be reserved and used only for the programs authorized in subdivision 2.32.13    Subd. 8.Commissioner authority to withhold revenue.(a) The commissioner 32.14must review the results of each district's integration and achievement plan by August 1 at 32.15the end of the third year of implementing the plan and determine if the district met its goals.32.16(b) If a district met its goals, it may submit a new three-year plan to the commissioner 32.17for review.32.18(c) If a district has not met its goals, the commissioner must:32.19(1) develop a district improvement plan and timeline, in consultation with the 32.20affected district, that identifies strategies and practices designed to meet the district's goals 32.21under this section and section 120B.11; and32.22(2) use up to 20 percent of the district's integration revenue, until the district's goals 32.23are reached, to implement the improvement plan.32.24EFFECTIVE DATE.This section is effective for revenue for fiscal year 2014 and 32.25later. Subdivision 5 is effective for taxes payable in 2014 only.32.26    Sec. 2. Minnesota Statutes 2012, section 126C.10, subdivision 1, is amended to read:32.27    Subdivision 1. General education revenue.(a) For fiscal years 2013 and 2014, the 32.28general education revenue for each district equals the sum of the district's basic revenue, 32.29extended time revenue, gifted and talented revenue, small schools revenue, basic skills 32.30revenue, training and experience revenue, secondary sparsity revenue, elementary sparsity 32.31revenue, transportation sparsity revenue, total operating capital revenue, equity revenue, 32.32alternative teacher compensation revenue, and transition revenue.32.33(b)  For fiscal year 2015 and later, the general education revenue for each district 32.34equals the sum of the district's basic revenue, extended time revenue, gifted and 32.35talented revenue, declining enrollment revenue, location equity revenue, small schools 33.1revenue, basic skills revenue, secondary sparsity revenue, elementary sparsity revenue, 33.2transportation sparsity revenue, total operating capital revenue, equity revenue, pension 33.3adjustment revenue, and transition revenue.33.4    Sec. 3. Minnesota Statutes 2012, section 126C.10, is amended by adding a subdivision 33.5to read:33.6    Subd. 2d.Location equity revenue.(a) For a school district with any of its area 33.7located within the seven-county metropolitan area, location equity revenue equals $424 33.8times the adjusted pupil units of the district for that school year.33.9(b) For all other school districts with more than 2,000 pupils in adjusted average 33.10daily membership for the fiscal year ending in the year before the levy is certified, location 33.11equity revenue equals $212 times the adjusted pupil units of the district for that year.33.12(c) A district's location equity levy equals its location equity revenue times the lesser 33.13of one or the ratio of its referendum market value per resident pupil unit to $510,000. The 33.14location equity revenue levy must be spread on referendum market value.33.15(d) A district's location equity aid equals its location equity revenue less its location 33.16equity levy, times the ratio of the actual amount levied to the permitted levy.33.17(e) A school district may elect not to participate in the location equity revenue 33.18program by a board vote taken prior to September 1 of the fiscal year before the fiscal year 33.19for which the decision not to participate becomes effective. The board resolution must 33.20state which fiscal years the district will not participate. A copy of the board resolution 33.21to not participate must be submitted to the commissioner.33.22EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015 33.23and later.33.24    Sec. 4. Minnesota Statutes 2012, section 126C.13, subdivision 4, is amended to read:33.25    Subd. 4. General education aid.(a) For fiscal years 2007 2013 and later 2014 only, 33.26a district's general education aid is the sum of the following amounts:33.27    (1) general education revenue, excluding equity revenue, total operating capital 33.28revenue, alternative teacher compensation revenue, and transition revenue;33.29    (2) operating capital aid under section 
         126C.10, subdivision 13b;33.30    (3) equity aid under section 
         126C.10, subdivision 30;33.31    (4) alternative teacher compensation aid under section 
         126C.10, subdivision 36;33.32    (5) transition aid under section 
         126C.10, subdivision 33;33.33    (6) shared time aid under section 
         126C.01, subdivision 7;33.34    (7) referendum aid under section 
         126C.17, subdivisions 7 and 7a; and34.1    (8) online learning aid according to section 
         124D.096.34.2(b) For fiscal year 2015 and later, a district's general education aid equals:34.3(1) general education revenue, excluding operating capital revenue, equity revenue, 34.4location equity revenue, and transition revenue, minus the student achievement levy, 34.5multiplied times the ratio of the actual amount of student achievement levy levied to the 34.6permitted student achievement levy; plus34.7(2) equity aid under section 126C.10, subdivision 30; plus34.8(3) transition aid under section 126C.10, subdivision 33; plus34.9(4) shared time aid under section 126C.10, subdivision 7; plus34.10(5) referendum aid under section 126C.17, subdivisions 7 and 7a;34.11(6) online learning aid under section 124D.096; plus34.12(7) location equity aid according to section 126C.10, subdivision 2d, paragraph (d).34.13    Sec. 5. Minnesota Statutes 2012, section 126C.17, is amended to read:34.14126C.17 REFERENDUM REVENUE.34.15    Subdivision 1. Referendum allowance.(a) For fiscal year 2003 and later, a district's 34.16initial referendum revenue allowance equals the sum of the allowance under section 34.17126C.16, subdivision 2, plus any additional allowance per resident marginal cost pupil 34.18unit authorized under subdivision 9 before May 1, 2001, for fiscal year 2002 and later, 34.19plus the referendum conversion allowance approved under subdivision 13, minus $415. 34.20For districts with more than one referendum authority, the reduction must be computed 34.21separately for each authority. The reduction must be applied first to the referendum 34.22conversion allowance and next to the authority with the earliest expiration date. A 34.23district's initial referendum revenue allowance may not be less than zero.34.24(b) For fiscal year 2003, a district's referendum revenue allowance equals the initial 34.25referendum allowance plus any additional allowance per resident marginal cost pupil unit 34.26authorized under subdivision 9 between April 30, 2001, and December 30, 2001, for 34.27fiscal year 2003 and later.34.28(c) For fiscal year 2004 and later, a district's referendum revenue allowance equals 34.29the sum of:34.30(1) the product of (i) the ratio of the resident marginal cost pupil units the district 34.31would have counted for fiscal year 2004 under Minnesota Statutes 2002, section 126C.05, 34.32to the district's resident marginal cost pupil units for fiscal year 2004, times (ii) the initial 34.33referendum allowance plus any additional allowance per resident marginal cost pupil unit 34.34authorized under subdivision 9 between April 30, 2001, and May 30, 2003, for fiscal 34.35year 2003 and later, plus35.1(2) any additional allowance per resident marginal cost pupil unit authorized under 35.2subdivision 9 after May 30, 2003, for fiscal year 2005 and later.35.3(a) A district's initial referendum allowance for fiscal year 2015 equals the result of 35.4the following calculations:35.5(1) multiply the referendum allowance the district would have received for fiscal 35.6year 2015 under Minnesota Statutes 2012, section 126C.17, subdivision 1, based on 35.7elections held before July 1, 2013, by the resident marginal cost pupil units the district 35.8would have counted for fiscal year 2015 under Minnesota Statutes 2012, section 126C.05;35.9(2) add to the result of clause (1) the adjustment the district would have received 35.10under Minnesota Statutes 2012, section 127A.47, subdivision 7, paragraphs (a), (b), and 35.11(c), based on elections held before July 1, 2013;35.12(3) divide the result of clause (2) by the district's adjusted pupil units for fiscal 35.13year 2015; and35.14(4) if the result of clause (3) is less than zero, set the allowance to zero.35.15(b) A district's referendum allowance equals the sum of the district's initial 35.16referendum allowance for fiscal year 2015, plus any additional referendum allowance per 35.17adjusted pupil unit authorized after June 30, 2013, minus (i) the location equity revenue 35.18subtraction, and (ii) any allowances expiring in fiscal year 2016 or later, provided that 35.19the allowance may not be less than zero. For a district with more than one referendum 35.20allowance for fiscal year 2015 under Minnesota Statutes 2012, section 126C.17, the 35.21allowance calculated under paragraph (a) must be divided into components such that the 35.22same percentage of the district's allowance expires at the same time as the old allowances 35.23would have expired under Minnesota Statutes 2012, section 126C.17.35.24(c) For purposes of this subdivision, a district's location equity revenue subtraction 35.25equals $424 for a district receiving location equity revenue under section 126C.10, 35.26subdivision 2d, paragraph (a), $212 for a district receiving location equity revenue under 35.27section 126C.10, subdivision 2d, paragraph (b), and zero for all other school districts.35.28    Subd. 2. Referendum allowance limit. (a) Notwithstanding subdivision 1, for fiscal 35.29year 2007 2015 and later, a district's referendum allowance must not exceed the greater of:35.30(1) the sum of: (i) a district's referendum allowance for fiscal year 1994 times 1.177 35.31times the annual inflationary increase as calculated under paragraph (b) plus (ii) its 35.32referendum conversion allowance for fiscal year 2003, minus (iii) $215;35.33(2) the greater of (i): 26 percent of the formula allowance or (ii) $1,294 times the 35.34annual inflationary increase as calculated under paragraph (b); or times the greatest of:35.35(1) $1,845;36.1(2) the sum of the referendum revenue the district would have received for fiscal 36.2year 2015 under Minnesota Statutes 2012, section 126C.17, subdivision 4, based on 36.3elections held before July 1, 2013, and the adjustment the district would have received 36.4under Minnesota Statutes 2012, section 127A.47, subdivision 7, paragraphs (a), (b), and 36.5(c), based on elections held before July 1, 2013, divided by the district's adjusted pupil 36.6units for fiscal year 2015; or36.7(3) the product of the referendum allowance limit the district would have received 36.8for fiscal year 2015 under Minnesota Statutes 2012, section 126C.17, subdivision 2, and 36.9the resident marginal cost pupil units the district would have received for fiscal year 2015 36.10under Minnesota Statutes 2012, section 126C.05, subdivision 6, plus the adjustment the 36.11district would have received under Minnesota Statutes 2012, section 127A.47, subdivision 36.127, paragraphs (a), (b), and (c), based on elections held before July 1, 2013, divided by 36.13the district's adjusted pupil units for fiscal year 2015; minus $424 for a district receiving 36.14location equity revenue under section 126C.10, subdivision 2d, paragraph (a), minus 36.15$212 for a district receiving location equity revenue under section 126C.10, subdivision 36.162d, paragraph (b), or36.17(3) (4) for a newly reorganized district created after July 1, 2006 2013, the referendum 36.18revenue authority for each reorganizing district in the year preceding reorganization divided 36.19by its resident marginal cost adjusted pupil units for the year preceding reorganization.36.20(b) For purposes of this subdivision, for fiscal year 2005 2016 and later, "inflationary 36.21increase" means one plus the percentage change in the Consumer Price Index for urban 36.22consumers, as prepared by the United States Bureau of Labor Standards, for the current 36.23fiscal year to fiscal year 2004 2015. For fiscal years 2009 year 2016 and later, for purposes 36.24of paragraph (a), clause (1) (3), the inflationary increase equals the inflationary increase 36.25for fiscal year 2008 plus one-fourth of the percentage increase in the formula allowance 36.26for that year compared with the formula allowance for fiscal year 2008 2015.36.27    Subd. 3. Sparsity exception. A district that qualifies for sparsity revenue under 36.28section 
         126C.10 is not subject to a referendum allowance limit.36.29    Subd. 4. Total referendum revenue. The total referendum revenue for each district 36.30equals the district's referendum allowance times the resident marginal cost adjusted pupil 36.31units for the school year.36.32    Subd. 5. Referendum equalization revenue. (a) For fiscal year 2003 and later,36.33 A district's referendum equalization revenue equals the sum of the first tier referendum 36.34equalization revenue and the second tier referendum equalization revenue, and the third 36.35tier referendum equalization revenue.37.1(b) A district's first tier referendum equalization revenue equals the district's first 37.2tier referendum equalization allowance times the district's resident marginal cost adjusted37.3 pupil units for that year.37.4(c) For fiscal year 2006, a district's first tier referendum equalization allowance 37.5equals the lesser of the district's referendum allowance under subdivision 1 or $500. For 37.6fiscal year 2007, a district's first tier referendum equalization allowance equals the lesser 37.7of the district's referendum allowance under subdivision 1 or $600.37.8For fiscal year 2008 and later, A district's first tier referendum equalization allowance 37.9equals the lesser of the district's referendum allowance under subdivision 1 or $700$300.37.10(d) A district's second tier referendum equalization revenue equals the district's 37.11second tier referendum equalization allowance times the district's resident marginal cost37.12 adjusted pupil units for that year.37.13(e) For fiscal year 2006, a district's second tier referendum equalization allowance 37.14equals the lesser of the district's referendum allowance under subdivision 1 or 18.6 37.15percent of the formula allowance, minus the district's first tier referendum equalization 37.16allowance. For fiscal year 2007 and later, A district's second tier referendum equalization 37.17allowance equals the lesser of the district's referendum allowance under subdivision 1 37.18or 26 percent of the formula allowance $760, minus the district's first tier referendum 37.19equalization allowance.37.20(f) Notwithstanding paragraph (e), the second tier referendum allowance for a 37.21district qualifying for secondary sparsity revenue under section 126C.10, subdivision 7, or 37.22elementary sparsity revenue under section 126C.10, subdivision 8, equals the district's 37.23referendum allowance under subdivision 1 minus the district's first tier referendum 37.24equalization allowance. A district's third tier referendum equalization revenue equals the 37.25district's third tier referendum equalization allowance times the district's adjusted pupil 37.26units for that year.37.27(g) A district's third tier referendum equalization allowance equals the lesser of 37.28the district's referendum allowance under subdivision 1 or 25 percent of the formula 37.29allowance, minus the sum of the district's first tier referendum equalization allowance and 37.30second tier referendum equalization allowance.37.31(h) Notwithstanding paragraph (g), the third tier referendum allowance for a district 37.32qualifying for secondary sparsity revenue under section 126C.10, subdivision 7, or 37.33elementary sparsity revenue under section 126C.10, subdivision 8, equals the district's 37.34referendum allowance under subdivision 1 minus the sum of the district's first tier 37.35referendum equalization allowance and second tier referendum equalization allowance.38.1    Subd. 6. Referendum equalization levy. (a) For fiscal year 2003 and later, 38.2a district's referendum equalization levy equals the sum of the first tier referendum 38.3equalization levy and the second tier referendum equalization levy, and the third tier 38.4referendum equalization levy.38.5(b) A district's first tier referendum equalization levy equals the district's first tier 38.6referendum equalization revenue times the lesser of one or the ratio of the district's 38.7referendum market value per resident marginal cost pupil unit to $476,000 $880,000.38.8(c) A district's second tier referendum equalization levy equals the district's second 38.9tier referendum equalization revenue times the lesser of one or the ratio of the district's 38.10referendum market value per resident marginal cost pupil unit to $270,000 $510,000.38.11(d) A district's third tier referendum equalization levy equals the district's third 38.12tier referendum equalization revenue times the lesser of one or the ratio of the district's 38.13referendum market value per resident pupil unit to $290,000.38.14    Subd. 7. Referendum equalization aid. (a) A district's referendum equalization aid 38.15equals the difference between its referendum equalization revenue and levy.38.16(b) If a district's actual levy for first or, second, or third tier referendum equalization 38.17revenue is less than its maximum levy limit for that tier, aid shall be proportionately 38.18reduced.38.19(c) Notwithstanding paragraph (a), the referendum equalization aid for a district, 38.20where the referendum equalization aid under paragraph (a) exceeds 90 percent of the 38.21referendum revenue, must not exceed 26 25 percent of the formula allowance times the 38.22district's resident marginal cost adjusted pupil units. A district's referendum levy is 38.23increased by the amount of any reduction in referendum aid under this paragraph.38.24    Subd. 7a. Referendum tax base replacement aid. For each school district that 38.25had a referendum allowance for fiscal year 2002 exceeding $415, for each separately 38.26authorized referendum levy, the commissioner of revenue, in consultation with the 38.27commissioner of education, shall certify the amount of the referendum levy in taxes 38.28payable year 2001 attributable to the portion of the referendum allowance exceeding $415 38.29levied against property classified as class 2, noncommercial 4c(1), or 4c(4), under section 38.30273.13
         , excluding the portion of the tax paid by the portion of class 2a property consisting 38.31of the house, garage, and surrounding one acre of land. The resulting amount must be 38.32used to reduce the district's referendum levy amount otherwise determined, and must be 38.33paid to the district each year that the referendum authority remains in effect, is renewed, 38.34or new referendum authority is approved. The aid payable under this subdivision must 38.35be subtracted from the district's referendum equalization aid under subdivision 7. The 38.36referendum equalization aid after the subtraction must not be less than zero.39.1    Subd. 7b.Referendum aid guarantee.(a) Notwithstanding subdivision 7, a 39.2district's referendum equalization aid for fiscal year 2015 must not be less than the sum 39.3of the referendum equalization aid the district would have received for fiscal year 2015 39.4under Minnesota Statutes 2012, section 126C.17, subdivision 7, and the adjustment the 39.5district would have received under Minnesota Statutes 2012, section 127A.47, subdivision 39.67, paragraphs (a), (b), and (c).39.7(b) Notwithstanding subdivision 7, referendum equalization aid for fiscal year 2016 39.8and later, for a district qualifying for additional aid under paragraph (a) for fiscal year 39.92015, must not be less than the product of (1) the district's referendum equalization aid 39.10for fiscal year 2015, times (2) the lesser of one or the ratio of the district's referendum 39.11revenue for that school year to the district's referendum revenue for fiscal year 2015, times 39.12(3) the lesser of one or the ratio of the district's referendum market value used for fiscal 39.13year 2015 referendum equalization calculations to the district's referendum market value 39.14used for that year's referendum equalization calculations.39.15    Subd. 8. Unequalized referendum levy. Each year, a district may levy an amount 39.16equal to the difference between its total referendum revenue according to subdivision 4 39.17and its referendum equalization revenue according to subdivision 5.39.18    Subd. 9. Referendum revenue. (a) The revenue authorized by section 
         126C.10, 39.19subdivision 1
         , may be increased in the amount approved by the voters of the district 39.20at a referendum called for the purpose. The referendum may be called by the board. 39.21The referendum must be conducted one or two calendar years before the increased levy 39.22authority, if approved, first becomes payable. Only one election to approve an increase 39.23may be held in a calendar year. Unless the referendum is conducted by mail under 39.24subdivision 11, paragraph (a), the referendum must be held on the first Tuesday after the 39.25first Monday in November. The ballot must state the maximum amount of the increased 39.26revenue per resident marginal cost adjusted pupil unit. The ballot may state a schedule, 39.27determined by the board, of increased revenue per resident marginal cost adjusted pupil 39.28unit that differs from year to year over the number of years for which the increased revenue 39.29is authorized or may state that the amount shall increase annually by the rate of inflation. 39.30For this purpose, the rate of inflation shall be the annual inflationary increase calculated 39.31under subdivision 2, paragraph (b). The ballot may state that existing referendum levy 39.32authority is expiring. In this case, the ballot may also compare the proposed levy authority 39.33to the existing expiring levy authority, and express the proposed increase as the amount, if 39.34any, over the expiring referendum levy authority. The ballot must designate the specific 39.35number of years, not to exceed ten, for which the referendum authorization applies. The 39.36ballot, including a ballot on the question to revoke or reduce the increased revenue amount 40.1under paragraph (c), must abbreviate the term "per resident marginal cost adjusted pupil 40.2unit" as "per pupil." The notice required under section 
         275.60 may be modified to read, in 40.3cases of renewing existing levies at the same amount per pupil as in the previous year:40.4"BY VOTING "YES" ON THIS BALLOT QUESTION, YOU ARE VOTING 40.5TO EXTEND AN EXISTING PROPERTY TAX REFERENDUM THAT IS 40.6SCHEDULED TO EXPIRE."40.7    The ballot may contain a textual portion with the information required in this 40.8subdivision and a question stating substantially the following:40.9    "Shall the increase in the revenue proposed by (petition to) the board of ........., 40.10School District No. .., be approved?"40.11    If approved, an amount equal to the approved revenue per resident marginal cost40.12 adjusted pupil unit times the resident marginal cost adjusted pupil units for the school 40.13year beginning in the year after the levy is certified shall be authorized for certification 40.14for the number of years approved, if applicable, or until revoked or reduced by the voters 40.15of the district at a subsequent referendum.40.16    (b) The board must prepare and deliver by first class mail at least 15 days but no more 40.17than 30 days before the day of the referendum to each taxpayer a notice of the referendum 40.18and the proposed revenue increase. The board need not mail more than one notice to any 40.19taxpayer. For the purpose of giving mailed notice under this subdivision, owners must be 40.20those shown to be owners on the records of the county auditor or, in any county where 40.21tax statements are mailed by the county treasurer, on the records of the county treasurer. 40.22Every property owner whose name does not appear on the records of the county auditor 40.23or the county treasurer is deemed to have waived this mailed notice unless the owner 40.24has requested in writing that the county auditor or county treasurer, as the case may be, 40.25include the name on the records for this purpose. The notice must project the anticipated 40.26amount of tax increase in annual dollars for typical residential homesteads, agricultural 40.27homesteads, apartments, and commercial-industrial property within the school district.40.28    The notice for a referendum may state that an existing referendum levy is expiring 40.29and project the anticipated amount of increase over the existing referendum levy in 40.30the first year, if any, in annual dollars for typical residential homesteads, agricultural 40.31homesteads, apartments, and commercial-industrial property within the district.40.32    The notice must include the following statement: "Passage of this referendum will 40.33result in an increase in your property taxes." However, in cases of renewing existing levies, 40.34the notice may include the following statement: "Passage of this referendum extends an 40.35existing operating referendum at the same amount per pupil as in the previous year."41.1    (c) A referendum on the question of revoking or reducing the increased revenue 41.2amount authorized pursuant to paragraph (a) may be called by the board. A referendum to 41.3revoke or reduce the revenue amount must state the amount per resident marginal cost 41.4pupil unit by which the authority is to be reduced. Revenue authority approved by the 41.5voters of the district pursuant to paragraph (a) must be available to the school district at 41.6least once before it is subject to a referendum on its revocation or reduction for subsequent 41.7years. Only one revocation or reduction referendum may be held to revoke or reduce 41.8referendum revenue for any specific year and for years thereafter.41.9    (d) The approval of 50 percent plus one of those voting on the question is required to 41.10pass a referendum authorized by this subdivision.41.11    (e) At least 15 days before the day of the referendum, the district must submit a 41.12copy of the notice required under paragraph (b) to the commissioner and to the county 41.13auditor of each county in which the district is located. Within 15 days after the results 41.14of the referendum have been certified by the board, or in the case of a recount, the 41.15certification of the results of the recount by the canvassing board, the district must notify 41.16the commissioner of the results of the referendum.41.17    Subd. 9a.Board-approved referendum allowance.Notwithstanding subdivision 41.189, a school district may convert up to $300 per adjusted pupil unit of referendum authority 41.19from voter approved to board approved by a board vote. A district with less than $300 41.20per adjusted pupil unit of referendum authority may authorize new referendum authority 41.21up to the difference between $300 per adjusted pupil unit and the district's referendum 41.22authority. The board may authorize this levy for up to five years and may subsequently 41.23reauthorize that authority in increments of up to five years.41.24    Subd. 10. School referendum levy; market value. A school referendum levy must 41.25be levied against the referendum market value of all taxable property as defined in section 41.26126C.01, subdivision 3
         . Any referendum levy amount subject to the requirements of this 41.27subdivision must be certified separately to the county auditor under section 
         275.07.41.28    Subd. 11. Referendum date. (a) Except for a referendum held under paragraph (b), 41.29any referendum under this section held on a day other than the first Tuesday after the first 41.30Monday in November must be conducted by mail in accordance with section 
         204B.46. 41.31Notwithstanding subdivision 9, paragraph (b), to the contrary, in the case of a referendum 41.32conducted by mail under this paragraph, the notice required by subdivision 9, paragraph (b), 41.33must be prepared and delivered by first-class mail at least 20 days before the referendum.41.34(b) In addition to the referenda allowed in subdivision 9, clause (a), the commissioner 41.35may grant authority to a district to hold a referendum on a different day if the district is in 42.1statutory operating debt and has an approved plan or has received an extension from the 42.2department to file a plan to eliminate the statutory operating debt.42.3(c) The commissioner must approve, deny, or modify each district's request for a 42.4referendum levy on a different day within 60 days of receiving the request from a district.42.5    Subd. 13. Referendum conversion allowance. A school district that received 42.6supplemental or transition revenue in fiscal year 2002 may convert its supplemental 42.7revenue conversion allowance and transition revenue conversion allowance to additional 42.8referendum allowance under subdivision 1 for fiscal year 2003 and thereafter. A majority 42.9of the school board must approve the conversion at a public meeting before November 1, 42.102001. For a district with other referendum authority, the referendum conversion allowance 42.11approved by the board continues until the portion of the district's other referendum 42.12authority with the earliest expiration date after June 30, 2006, expires. For a district 42.13with no other referendum authority, the referendum conversion allowance approved by 42.14the board continues until June 30, 2012.42.15EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015 42.16and later.42.17    Sec. 6. OPERATING REFERENDUM FREEZE, FISCAL YEAR 2015.42.18(a) Notwithstanding Minnesota Statutes, section 126C.17, subdivision 9, a school 42.19district may not authorize an increase to its operating referendum in fiscal year 2015. A 42.20school district may reauthorize an operating referendum that is expiring in fiscal year 2015.42.21(b) Paragraph (a) shall not apply to a district if, prior to June 30, 2013, the board 42.22adopted a resolution to conduct a referendum in 2013.42.23(c) Paragraph (a) shall not apply to a district if the district did not authorize an 42.24operating referendum in fiscal year 2014.42.25(d) Paragraph (a) shall not apply to a district if the district is in statutory operating 42.26debt under Minnesota Statutes, section 123B.81, as of June 30, 2013, and has an approved 42.27plan with the Department of Education.42.28ARTICLE 442.29PROPERTY TAXES42.30    Section 1. Minnesota Statutes 2012, section 103B.102, subdivision 3, is amended to 42.31read:42.32    Subd. 3. Evaluation and report. The Board of Water and Soil Resources shall 42.33evaluate performance, financial, and activity information for each local water management 42.34entity. The board shall evaluate the entities' progress in accomplishing their adopted plans 43.1on a regular basis as determined by the board based on budget and operations of the local 43.2water management entity, but not less than once every five ten years. The board shall 43.3maintain a summary of local water management entity performance on the board's Web site. 43.4Beginning February 1, 2008, and annually thereafter, the board shall provide an analysis 43.5of local water management entity performance to the chairs of the house of representatives 43.6and senate committees having jurisdiction over environment and natural resources policy.43.7    Sec. 2. Minnesota Statutes 2012, section 103B.335, is amended to read:43.8103B.335 TAX LEVY AUTHORITY.43.9    Subdivision 1. Local water planning and management. The governing body of 43.10any county, municipality, or township may levy a tax in an amount required to implement 43.11sections 
         103B.301 to 
         103B.355 or a comprehensive watershed management plan as 43.12defined in section 103B.3363.43.13    Subd. 2. Priority programs; conservation and watershed districts. A county 43.14may levy amounts necessary to pay the reasonable increased costs to soil and water 43.15conservation districts and watershed districts of administering and implementing priority 43.16programs identified in an approved and adopted plan or a comprehensive watershed 43.17management plan as defined in section 103B.3363.43.18    Sec. 3. Minnesota Statutes 2012, section 103B.3369, subdivision 5, is amended to read:43.19    Subd. 5. Financial assistance. A base grant may be awarded to a county that 43.20provides a match utilizing a water implementation tax or other local source. A water 43.21implementation tax that a county intends to use as a match to the base grant must be 43.22levied at a rate sufficient to generate a minimum amount determined by the board. 43.23The board may award performance-based grants to local units of government that are 43.24responsible for implementing elements of applicable portions of watershed management 43.25plans, comprehensive plans, local water management plans, or comprehensive watershed 43.26management plans, developed or amended, adopted and approved, according to chapter 43.27103B, 103C, or 103D. Upon request by a local government unit, the board may also 43.28award performance-based grants to local units of government to carry out TMDL 43.29implementation plans as provided in chapter 114D, if the TMDL implementation plan has 43.30been incorporated into the local water management plan according to the procedures for 43.31approving comprehensive plans, watershed management plans, local water management 43.32plans, or comprehensive watershed management plans under chapter 103B, 103C, or 43.33103D, or if the TMDL implementation plan has undergone a public review process. 43.34Notwithstanding section 
         16A.41, the board may award performance-based grants on an 44.1advanced basis. The fee authorized in section 40A.152 may be used as a local match 44.2or as a supplement to state funding to accomplish implementation of comprehensive 44.3plans, watershed management plans, local water management plans, or comprehensive 44.4watershed management plans under chapter 103B, 103C, or 103D.44.5    Sec. 4. Minnesota Statutes 2012, section 103C.501, subdivision 4, is amended to read:44.6    Subd. 4. Cost-sharing funds. (a) The state board shall allocate at least 70 percent 44.7of cost-sharing funds to areas with high priority erosion, sedimentation, or water quality 44.8problems or water quantity problems due to altered hydrology. The areas must be selected 44.9based on the statewide priorities established by the state board. 44.10    (b) The allocated funds must be used for conservation practices for high priority 44.11problems identified in the comprehensive and annual work plans of the districts, for 44.12the technical assistance portion of the grant funds to leverage federal or other nonstate 44.13funds, or to address high-priority needs identified in local water management plans or 44.14comprehensive watershed management plans.44.15    (b) The remaining cost-sharing funds may be allocated to districts as follows:44.16    (1) for technical and administrative assistance, not more than 20 percent of the 44.17funds; and44.18    (2) for conservation practices for lower priority erosion, sedimentation, or water 44.19quality problems.44.20    Sec. 5. Minnesota Statutes 2012, section 103F.405, subdivision 1, is amended to read:44.21    Subdivision 1. Authority. Each statutory or home rule charter city, town, or 44.22county that has planning and zoning authority under sections 
         366.10 to 
         366.19, 
         394.2144.23to 
         394.37, or 
         462.351 to 
         462.365 is encouraged to adopt a soil loss ordinance. The soil 44.24loss ordinance must use the soil loss tolerance for each soil series described in the United 44.25States SoilNatural Resources Conservation Service Field Office Technical Guide, or 44.26another method approved by the Board of Water and Soil Resources, to determine the 44.27soil loss limits, but the soil loss limits must be attainable by the best practicable soil 44.28conservation practice. Ordinances adopted by local governments within the metropolitan 44.29area defined in section 473.121 must be consistent with local water management plans 44.30adopted under section 103B.235 a comprehensive plan, local water management plan, or 44.31watershed management plan developed or amended, adopted, and approved according 44.32to chapter 103B, 103C, or 103D.44.33    Sec. 6. Minnesota Statutes 2012, section 168.012, subdivision 9, is amended to read:45.1    Subd. 9. Manufactured homes and park trailers. Manufactured homes and park 45.2trailers shall not be taxed as motor vehicles using the public streets and highways and shall 45.3be exempt from the motor vehicle tax provisions of this chapter. Except as provided in 45.4section 
         273.125, manufactured homes and park trailers shall be taxed as personal property. 45.5The provisions of Minnesota Statutes 1957, section 
         272.02 or any other act providing for 45.6tax exemption shall be inapplicable to manufactured homes and park trailers, except 45.7such manufactured homes as are held by a licensed dealer or limited dealer, as defined 45.8in section 327B.04, and exempted as inventory under subdivision 9a. Travel trailers not 45.9conspicuously displaying current registration plates on the property tax assessment date 45.10shall be taxed as manufactured homes if occupied as human dwelling places.45.11EFFECTIVE DATE.This section is effective for taxes payable in 2014 and 45.12thereafter.45.13    Sec. 7. Minnesota Statutes 2012, section 168.012, is amended by adding a subdivision 45.14to read:45.15    Subd. 9a.Manufactured home as dealer inventory.Manufactured homes as 45.16defined in section 327.31, subdivision 6, shall be considered as dealer inventory, on the 45.17January 2 assessment date, if the home is:45.18(1) listed as inventory and held by a licensed or limited dealer;45.19(2) unoccupied and not available for rent;45.20(3) connected or not connected to utilities when located in a manufactured home 45.21park; and45.22(4) connected or not connected to utilities when located at a dealer's sales center.45.23The exemption under this subdivision is allowable for up to five assessment years after 45.24the date a home is initially claimed as dealer inventory.45.25EFFECTIVE DATE.This section is effective for taxes payable in 2014 and 45.26thereafter.45.27    Sec. 8. Minnesota Statutes 2012, section 270.41, subdivision 3, is amended to read:45.28    Subd. 3. Licenses; refusal or revocation Assessor sanctions; refusal to license.45.29    (a) The board may (i) refuse to grant or renew, or may suspend or revoke, a license 45.30of an applicant or licensee, or (ii) censure, warn, or fine any licensed assessor, or any 45.31other person employed by an assessment jurisdiction or contracting with an assessment 45.32jurisdiction for the purpose of valuing or classifying property for property tax purposes,45.33 for any of the following causes or acts:46.1    (1) failure to complete required training;46.2    (2) inefficiency or neglect of duty;46.3    (3) failure to comply with the Code of Conduct and Ethics for Licensed Minnesota 46.4Assessors adopted by the board pursuant to Laws 2005, First Special Session chapter 3, 46.5article 1, section 38;46.6    (4) conviction of a crime involving moral turpitude; or46.7(5) failure to faithfully and fully perform his or her duties through malfeasance, 46.8misfeasance, or nonfeasance; or46.9    (5) (6) any other cause or act that in the board's opinion warrants a refusal to issue 46.10or suspension or revocation of a license or the imposition of a sanction provided under 46.11this subdivision.46.12(b) When appropriate for the level of infraction, a written warning must be given 46.13to assessors who have no prior identified infractions. The warning must identify the 46.14infraction and, as appropriate, detail future expectations of performance and behavior. 46.15Fines must not exceed $1,000 for the first occurrence and must not exceed $3,000 for each 46.16occurrence thereafter, and suspensions must not exceed one year for each occurrence, 46.17depending in each case upon the severity of the infraction and the level of negligence or 46.18intent. An action by the board to impose a sanction is subject to review in a contested 46.19case hearing under chapter 14.46.20EFFECTIVE DATE.This section is effective beginning July 1, 2013.46.21    Sec. 9. Minnesota Statutes 2012, section 270.41, is amended by adding a subdivision 46.22to read:46.23    Subd. 3a.Report on disciplinary actions.Each odd-numbered year, the board 46.24must publish a report detailing the number and types of disciplinary actions recommended 46.25by the commissioner of revenue under section 273.0645, subdivision 2, and the disposition 46.26of those recommendations by the board. The report must be presented to the house of 46.27representatives and senate committees with jurisdiction over property taxes by February 1 46.28of each odd-numbered year.46.29EFFECTIVE DATE.This section is effective beginning July 1, 2013.46.30    Sec. 10. Minnesota Statutes 2012, section 270.45, is amended to read:46.31270.45 DISPOSITION OF FEES AND FINES.47.1    All fees and fines so established and collected shall be paid to the commissioner of 47.2management and budget for deposit in the general fund. The expenses of carrying out the 47.3provisions of sections 
         270.41 to 
         270.50 shall be paid from appropriations made to the board.47.4EFFECTIVE DATE.This section is effective beginning July 1, 2013.47.5    Sec. 11. [270C.9901] ASSESSOR ACCREDITATION.47.6Every individual who appraises or physically inspects real property for the purpose 47.7of determining its valuation or classification for property tax purposes must obtain 47.8licensure as an accredited Minnesota assessor from the State Board of Assessors by July 1, 47.92019, or within four years of that person having become licensed as a certified Minnesota 47.10assessor, whichever is later.47.11EFFECTIVE DATE.This section is effective beginning January 1, 2014.47.12    Sec. 12. Minnesota Statutes 2012, section 272.02, subdivision 39, is amended to read:47.13    Subd. 39. Economic development; public purpose. The holding of property by a 47.14political subdivision of the state for later resale for economic development purposes 47.15shall be considered a public purpose in accordance with subdivision 8 for a period not to 47.16exceed nine years, except that:47.17(1) for property located in a city of 5,000 20,000 population or under that is located 47.18outside of the metropolitan area as defined in section 
         473.121, subdivision 2, the period 47.19must not exceed 15 years.; and47.20(2) for any property that was acquired on or after January 1, 2000, and on or before 47.21December 31, 2010, and is located in a city, the period must not exceed 15 years.47.22The holding of property by a political subdivision of the state for later resale (1) 47.23which is purchased or held for housing purposes, or (2) which meets the conditions 47.24described in section 
         469.174, subdivision 10, shall be considered a public purpose in 47.25accordance with subdivision 8.47.26The governing body of the political subdivision which acquires property which is 47.27subject to this subdivision shall after the purchase of the property certify to the city or 47.28county assessor whether the property is held for economic development purposes or 47.29housing purposes, or whether it meets the conditions of section 
         469.174, subdivision 10. 47.30If the property is acquired for economic development purposes and buildings or other 47.31improvements are constructed after acquisition of the property, and if more than one-half 47.32of the floor space of the buildings or improvements which is available for lease to or use 47.33by a private individual, corporation, or other entity is leased to or otherwise used by 48.1a private individual, corporation, or other entity the provisions of this subdivision shall 48.2not apply to the property. This subdivision shall not create an exemption from section 48.3272.01, subdivision 2
         ; 
         272.68; 
         273.19; or 
         469.040, subdivision 3; or other provision of 48.4law providing for the taxation of or for payments in lieu of taxes for publicly held property 48.5which is leased, loaned, or otherwise made available and used by a private person.48.6EFFECTIVE DATE.This section is effective for assessment year 2013 and 48.7thereafter and for taxes payable in 2014 and thereafter.48.8    Sec. 13. Minnesota Statutes 2012, section 272.02, is amended by adding a subdivision 48.9to read:48.10    Subd. 98.Certain property owned by an Indian tribe.(a) Property is exempt that:48.11(1) was classified as 3a under section 273.13, subdivision 24, for taxes payable 48.12in 2013;48.13(2) is located in a city of the first class with a population greater than 300,000 as of 48.14the 2010 federal census;48.15(3) was on January 2, 2012, and is for the current assessment owned by a federally 48.16recognized Indian tribe, or its instrumentality, that is located within the state of Minnesota; 48.17and48.18(4) is used exclusively for tribal purposes or institutions of purely public charity as 48.19defined in subdivision 7.48.20(b) For purposes of this subdivision, a "tribal purpose" means a public purpose 48.21as defined in subdivision 8 and includes noncommercial tribal government activities. 48.22Property that qualifies for the exemption under this subdivision is limited to no more than 48.23two contiguous parcels and structures that do not exceed in the aggregate 20,000 square 48.24feet. Property acquired for single-family housing, market-rate apartments, agriculture, or 48.25forestry does not qualify for this exemption. The exemption created by this subdivision 48.26expires with taxes payable in 2024.48.27EFFECTIVE DATE.This section is effective beginning with taxes payable in 2014.48.28    Sec. 14. Minnesota Statutes 2012, section 272.02, is amended by adding a subdivision 48.29to read:48.30    Subd. 99.Electric generation facility; personal property.(a) Notwithstanding 48.31subdivision 9, clause (a), and section 453.54, subdivision 20, attached machinery and 48.32other personal property which is part of an electric generation facility that exceeds five 49.1megawatts of installed capacity and meets the requirements of this subdivision is exempt. 49.2At the time of construction, the facility must be:49.3    (1) designed to utilize natural gas as a primary fuel;49.4    (2) owned and operated by a municipal power agency as defined in section 453.52, 49.5subdivision 8;49.6    (3) designed to utilize reciprocating engines paired with generators to produce 49.7electrical power;49.8    (4) located within the service territory of a municipal power agency's electrical 49.9municipal utility that serves load exclusively in a metropolitan county as defined in 49.10section 473.121, subdivision 4; and49.11(5) designed to connect directly with a municipality's substation.49.12    (b) Construction of the facility must be commenced after June 1, 2013, and before 49.13June 1, 2017. Property eligible for this exemption does not include electric transmission 49.14lines and interconnections or gas pipelines and interconnections appurtenant to the 49.15property or the facility.49.16EFFECTIVE DATE.This section is effective for assessment year 2013, taxes 49.17payable in 2014, and thereafter.49.18    Sec. 15. Minnesota Statutes 2012, section 273.061, subdivision 2, is amended to read:49.19    Subd. 2. Term; vacancy. (a) The terms of county assessors appointed under this 49.20section shall be four years. A new term shall begin on January 1 of every fourth year 49.21after 1973. When any vacancy in the office occurs, the board of county commissioners, 49.22within 90 days thereafter, shall fill the same by appointment for the remainder of the term, 49.23following the procedure prescribed in subdivision 1. The term of the county assessor 49.24may be terminated by the board of county commissioners at any time, on charges of 49.25malfeasance, misfeasance, or nonfeasance by the commissioner of revenue. If the board 49.26of county commissioners does not intend to reappoint a county assessor who has been 49.27certified by the state Board of Assessors, the board shall present written notice to the 49.28county assessor not later than 90 days prior to the termination of the assessor's term, that it 49.29does not intend to reappoint the assessor. If written notice is not timely made, the county 49.30assessor will automatically be reappointed by the board of county commissioners.49.31The commissioner of revenue may recommend to the state Board of Assessors the 49.32nonrenewal, suspension, or revocation of an assessor's license as provided in sections 49.33270.41 to 270.50.49.34(b) In the event of a vacancy in the office of county assessor, through death, 49.35resignation or other reasons, the deputy (or chief deputy, if more than one) shall perform 50.1the functions of the office. If there is no deputy, the county auditor shall designate a person 50.2to perform the duties of the office until an appointment is made as provided in clause (a). 50.3Such person shall perform the duties of the office for a period not exceeding 90 days 50.4during which the county board must appoint a county assessor. Such 90-day period may, 50.5however, be extended by written approval of the commissioner of revenue.50.6(c) In the case of the first appointment under paragraph (a) of a county assessor who 50.7is accredited but who does not have senior accreditation, an approval of the appointment 50.8by the commissioner shall be provisional, provided that a county assessor appointed to 50.9a provisional term under this paragraph must reapply to the commissioner at the end of 50.10the provisional term. A provisional term may not exceed two years. The commissioner 50.11shall not approve the appointment for the remainder of the four-year term unless the 50.12assessor has obtained senior accreditation.50.13EFFECTIVE DATE.This section is effective beginning July 1, 2013.50.14    Sec. 16. Minnesota Statutes 2012, section 273.0645, is amended to read:50.15273.0645 COMMISSIONER REVIEW OF LOCAL ASSESSMENT 50.16PRACTICES.50.17    Subdivision 1.Local assessment practices. The commissioner of revenue must 50.18review the assessment practices in a taxing jurisdiction if requested in writing by a 50.19qualifying number of property owners in that taxing jurisdiction. The request must be 50.20signed by the greater of:50.21    (1) ten percent of the registered voters who voted in the last general election; or50.22    (2) five property owners.50.23    The request must identify the city, town, or county and describe why a review is 50.24sought for that taxing jurisdiction. The commissioner must conduct the review in a 50.25reasonable amount of time and report the findings to the county board of the affected 50.26county, to the affected city council or town board, if the review is for a specific city or 50.27town, and to the property owner designated in the request as the person to receive the 50.28report on behalf of all the property owners who signed the request. The commissioner 50.29must also provide the report electronically to all property owners who signed the request 50.30and provided an e-mail address in order to receive the report electronically.50.31    Subd. 2.Nonfeasance, misfeasance, and malfeasance.County assessors may file a 50.32written complaint with the commissioner of revenue detailing allegations of nonfeasance, 50.33misfeasance, or malfeasance by a local assessor. After receiving a complaint from a county 50.34assessor, the commissioner must complete an investigation and recommend an appropriate 51.1action to the State Board of Assessors. The commissioner is not required to have a written 51.2complaint from a county assessor in order to conduct an investigation and recommend an 51.3action to the board. Active investigative data relating to the investigation of complaints 51.4against an assessor by the commissioner of revenue are subject to section 13.39.51.5EFFECTIVE DATE.This section is effective July 1, 2013.51.6    Sec. 17. Minnesota Statutes 2012, section 273.117, is amended to read:51.7273.117 CONSERVATION PROPERTY TAX VALUATION.51.8    The value of real property which is subject to a conservation restriction or easement 51.9may be adjusted shall not be reduced by the assessor if:51.10    (a) the restriction or easement is for a conservation purpose as defined in section 51.1184.64, subdivision 2
         , and is recorded on the property; and51.12    (b) the property is being used in accordance with the terms of the conservation 51.13restriction or easement.51.14This section does not apply to (1) conservation restrictions or easements covering 51.15riparian buffers along lakes, rivers, and streams that are used for water quantity or quality 51.16control; or (2) to easements in a county that has adopted, by referendum, a program to 51.17protect farmland and natural areas since 1999.51.18EFFECTIVE DATE.This section is effective for assessment year 2013 and 51.19thereafter, and for taxes payable in 2014 and thereafter.51.20    Sec. 18. Minnesota Statutes 2012, section 273.13, subdivision 25, is amended to read:51.21    Subd. 25. Class 4. (a) Class 4a is residential real estate containing four or more 51.22units and used or held for use by the owner or by the tenants or lessees of the owner 51.23as a residence for rental periods of 30 days or more, excluding property qualifying for 51.24class 4d. Class 4a also includes hospitals licensed under sections 
         144.50 to 
         144.56, other 51.25than hospitals exempt under section 
         272.02, and contiguous property used for hospital 51.26purposes, without regard to whether the property has been platted or subdivided. The 51.27market value of class 4a property has a class rate of 1.25 percent.51.28    (b) Class 4b includes:51.29    (1) residential real estate containing less than four units that does not qualify as class 51.304bb, other than seasonal residential recreational property;51.31    (2) manufactured homes not classified under any other provision;51.32    (3) a dwelling, garage, and surrounding one acre of property on a nonhomestead 51.33farm classified under subdivision 23, paragraph (b) containing two or three units; and52.1    (4) unimproved property that is classified residential as determined under subdivision 52.233.52.3    The market value of class 4b property has a class rate of 1.25 percent.52.4    (c) Class 4bb includes:52.5    (1) nonhomestead residential real estate containing one unit, other than seasonal 52.6residential recreational property; and52.7    (2) a single family dwelling, garage, and surrounding one acre of property on a 52.8nonhomestead farm classified under subdivision 23, paragraph (b).52.9    Class 4bb property has the same class rates as class 1a property under subdivision 22.52.10    Property that has been classified as seasonal residential recreational property at 52.11any time during which it has been owned by the current owner or spouse of the current 52.12owner does not qualify for class 4bb.52.13    (d) Class 4c property includes:52.14    (1) except as provided in subdivision 22, paragraph (c), real and personal property 52.15devoted to commercial temporary and seasonal residential occupancy for recreation 52.16purposes, for not more than 250 days in the year preceding the year of assessment. For 52.17purposes of this clause, property is devoted to a commercial purpose on a specific day 52.18if any portion of the property is used for residential occupancy, and a fee is charged for 52.19residential occupancy. Class 4c property under this clause must contain three or more 52.20rental units. A "rental unit" is defined as a cabin, condominium, townhouse, sleeping room, 52.21or individual camping site equipped with water and electrical hookups for recreational 52.22vehicles. A camping pad offered for rent by a property that otherwise qualifies for class 52.234c under this clause is also class 4c under this clause regardless of the term of the rental 52.24agreement, as long as the use of the camping pad does not exceed 250 days. In order for a 52.25property to be classified under this clause, either (i) the business located on the property 52.26must provide recreational activities, at least 40 percent of the annual gross lodging receipts 52.27related to the property must be from business conducted during 90 consecutive days, 52.28and either (A) at least 60 percent of all paid bookings by lodging guests during the year 52.29must be for periods of at least two consecutive nights; or (B) at least 20 percent of the 52.30annual gross receipts must be from charges for providing recreational activities, or (ii) the 52.31business must contain 20 or fewer rental units, and must be located in a township or a city 52.32with a population of 2,500 or less located outside the metropolitan area, as defined under 52.33section 
         473.121, subdivision 2, that contains a portion of a state trail administered by the 52.34Department of Natural Resources. For purposes of item (i)(A), a paid booking of five or 52.35more nights shall be counted as two bookings. Class 4c property also includes commercial 52.36use real property used exclusively for recreational purposes in conjunction with other class 53.14c property classified under this clause and devoted to temporary and seasonal residential 53.2occupancy for recreational purposes, up to a total of two acres, provided the property is 53.3not devoted to commercial recreational use for more than 250 days in the year preceding 53.4the year of assessment and is located within two miles of the class 4c property with which 53.5it is used. In order for a property to qualify for classification under this clause, the owner 53.6must submit a declaration to the assessor designating the cabins or units occupied for 250 53.7days or less in the year preceding the year of assessment by January 15 of the assessment 53.8year. Those cabins or units and a proportionate share of the land on which they are located 53.9must be designated class 4c under this clause as otherwise provided. The remainder of the 53.10cabins or units and a proportionate share of the land on which they are located will be 53.11designated as class 3a. The owner of property desiring designation as class 4c property 53.12under this clause must provide guest registers or other records demonstrating that the units 53.13for which class 4c designation is sought were not occupied for more than 250 days in the 53.14year preceding the assessment if so requested. The portion of a property operated as a 53.15(1) restaurant, (2) bar, (3) gift shop, (4) conference center or meeting room, and (5) other 53.16nonresidential facility operated on a commercial basis not directly related to temporary and 53.17seasonal residential occupancy for recreation purposes does not qualify for class 4c. For 53.18the purposes of this paragraph, "recreational activities" means renting ice fishing houses, 53.19boats and motors, snowmobiles, downhill or cross-country ski equipment; providing 53.20marina services, launch services, or guide services; or selling bait and fishing tackle;53.21    (2) qualified property used as a golf course if:53.22    (i) it is open to the public on a daily fee basis. It may charge membership fees or 53.23dues, but a membership fee may not be required in order to use the property for golfing, 53.24and its green fees for golfing must be comparable to green fees typically charged by 53.25municipal courses; and53.26    (ii) it meets the requirements of section 
         273.112, subdivision 3, paragraph (d).53.27    A structure used as a clubhouse, restaurant, or place of refreshment in conjunction 53.28with the golf course is classified as class 3a property;53.29    (3) real property up to a maximum of three acres of land owned and used by a 53.30nonprofit community service oriented organization and not used for residential purposes 53.31on either a temporary or permanent basis, provided that:53.32    (i) the property is not used for a revenue-producing activity for more than six days 53.33in the calendar year preceding the year of assessment; or53.34    (ii) the organization makes annual charitable contributions and donations at least 53.35equal to the property's previous year's property taxes and the property is allowed to be 54.1used for public and community meetings or events for no charge, as appropriate to the 54.2size of the facility.54.3    For purposes of this clause:54.4    (A) "charitable contributions and donations" has the same meaning as lawful 54.5gambling purposes under section 
         349.12, subdivision 25, excluding those purposes 54.6relating to the payment of taxes, assessments, fees, auditing costs, and utility payments;54.7    (B) "property taxes" excludes the state general tax;54.8    (C) a "nonprofit community service oriented organization" means any corporation, 54.9society, association, foundation, or institution organized and operated exclusively for 54.10charitable, religious, fraternal, civic, or educational purposes, and which is exempt from 54.11federal income taxation pursuant to section 501(c)(3), (8), (10), or (19) of the Internal 54.12Revenue Code; and54.13    (D) "revenue-producing activities" shall include but not be limited to property or that 54.14portion of the property that is used as an on-sale intoxicating liquor or 3.2 percent malt 54.15liquor establishment licensed under chapter 340A, a restaurant open to the public, bowling 54.16alley, a retail store, gambling conducted by organizations licensed under chapter 349, an 54.17insurance business, or office or other space leased or rented to a lessee who conducts a 54.18for-profit enterprise on the premises.54.19    Any portion of the property not qualifying under either item (i) or (ii) is class 3a. 54.20The use of the property for social events open exclusively to members and their guests 54.21for periods of less than 24 hours, when an admission is not charged nor any revenues are 54.22received by the organization shall not be considered a revenue-producing activity.54.23    The organization shall maintain records of its charitable contributions and donations 54.24and of public meetings and events held on the property and make them available upon 54.25request any time to the assessor to ensure eligibility. An organization meeting the 54.26requirement under item (ii) must file an application by May 1 with the assessor for 54.27eligibility for the current year's assessment. The commissioner shall prescribe a uniform 54.28application form and instructions;54.29    (4) postsecondary student housing of not more than one acre of land that is owned by 54.30a nonprofit corporation organized under chapter 317A and is used exclusively by a student 54.31cooperative, sorority, or fraternity for on-campus housing or housing located within two 54.32miles of the border of a college campus;54.33    (5)(i) manufactured home parks as defined in section 
         327.14, subdivision 3, 54.34excluding manufactured home parks described in section 
         273.124, subdivision 3a, and (ii) 54.35manufactured home parks as defined in section 
         327.14, subdivision 3, that are described in 54.36section 
         273.124, subdivision 3a;55.1    (6) real property that is actively and exclusively devoted to indoor fitness, health, 55.2social, recreational, and related uses, is owned and operated by a not-for-profit corporation, 55.3and is located within the metropolitan area as defined in section 
         473.121, subdivision 2;55.4    (7) a leased or privately owned noncommercial aircraft storage hangar not exempt 55.5under section 
         272.01, subdivision 2, and the land on which it is located, provided that:55.6    (i) the land is on an airport owned or operated by a city, town, county, Metropolitan 55.7Airports Commission, or group thereof; and55.8    (ii) the land lease, or any ordinance or signed agreement restricting the use of the 55.9leased premise, prohibits commercial activity performed at the hangar.55.10    If a hangar classified under this clause is sold after June 30, 2000, a bill of sale must 55.11be filed by the new owner with the assessor of the county where the property is located 55.12within 60 days of the sale;55.13    (8) a privately owned noncommercial aircraft storage hangar not exempt under 55.14section 
         272.01, subdivision 2, and the land on which it is located, provided that:55.15    (i) the land abuts a public airport; and55.16    (ii) the owner of the aircraft storage hangar provides the assessor with a signed 55.17agreement restricting the use of the premises, prohibiting commercial use or activity 55.18performed at the hangar; and55.19    (9) residential real estate, a portion of which is used by the owner for homestead 55.20purposes, and that is also a place of lodging, if all of the following criteria are met:55.21    (i) rooms are provided for rent to transient guests that generally stay for periods 55.22of 14 or fewer days;55.23    (ii) meals are provided to persons who rent rooms, the cost of which is incorporated 55.24in the basic room rate;55.25    (iii) meals are not provided to the general public except for special events on fewer 55.26than seven days in the calendar year preceding the year of the assessment; and55.27    (iv) the owner is the operator of the property.55.28    The market value subject to the 4c classification under this clause is limited to 55.29five rental units. Any rental units on the property in excess of five, must be valued and 55.30assessed as class 3a. The portion of the property used for purposes of a homestead by the 55.31owner must be classified as class 1a property under subdivision 22;55.32    (10) real property up to a maximum of three acres and operated as a restaurant 55.33as defined under section 
         157.15, subdivision 12, provided it: (A) is located on a lake 55.34as defined under section 
         103G.005, subdivision 15, paragraph (a), clause (3); and (B) 55.35is either devoted to commercial purposes for not more than 250 consecutive days, or 55.36receives at least 60 percent of its annual gross receipts from business conducted during 56.1four consecutive months. Gross receipts from the sale of alcoholic beverages must be 56.2included in determining the property's qualification under subitem (B). The property's 56.3primary business must be as a restaurant and not as a bar. Gross receipts from gift shop 56.4sales located on the premises must be excluded. Owners of real property desiring 4c 56.5classification under this clause must submit an annual declaration to the assessor by 56.6February 1 of the current assessment year, based on the property's relevant information for 56.7the preceding assessment year;56.8(11) lakeshore and riparian property and adjacent land, not to exceed six acres, used 56.9as a marina, as defined in section 
         86A.20, subdivision 5, which is made accessible to 56.10the public and devoted to recreational use for marina services. The marina owner must 56.11annually provide evidence to the assessor that it provides services, including lake or river 56.12access to the public by means of an access ramp or other facility that is either located on 56.13the property of the marina or at a publicly owned site that abuts the property of the marina. 56.14No more than 800 feet of lakeshore may be included in this classification. Buildings used 56.15in conjunction with a marina for marina services, including but not limited to buildings 56.16used to provide food and beverage services, fuel, boat repairs, or the sale of bait or fishing 56.17tackle, are classified as class 3a property; and56.18(12) real and personal property devoted to noncommercial temporary and seasonal 56.19residential occupancy for recreation purposes.56.20    Class 4c property has a class rate of 1.5 percent of market value, except that (i) each 56.21parcel of noncommercial seasonal residential recreational property under clause (12) 56.22has the same class rates as class 4bb property, (ii) manufactured home parks assessed 56.23under clause (5), item (i), have the same class rate as class 4b property, and the market 56.24value of manufactured home parks assessed under clause (5), item (ii), has the same class 56.25rate as class 4d property if more than 50 percent of the lots in the park are occupied by 56.26shareholders in the cooperative corporation or association and a class rate of one percent if 56.2750 percent or less of the lots are so occupied, (iii) commercial-use seasonal residential 56.28recreational property and marina recreational land as described in clause (11), has a 56.29class rate of one percent for the first $500,000 of market value, and 1.25 percent for the 56.30remaining market value, (iv) the market value of property described in clause (4) has a 56.31class rate of one percent, (v) the market value of property described in clauses (2), (6), and 56.32(10) has a class rate of 1.25 percent, and (vi) that portion of the market value of property 56.33in clause (9) qualifying for class 4c property has a class rate of 1.25 percent.56.34    (e) Class 4d property is qualifying low-income rental housing certified to the assessor 56.35by the Housing Finance Agency under section 
         273.128, subdivision 3. If only a portion 56.36of the units in the building qualify as low-income rental housing units as certified under 57.1section 
         273.128, subdivision 3, only the proportion of qualifying units to the total number 57.2of units in the building qualify for class 4d. The remaining portion of the building shall be 57.3classified by the assessor based upon its use. Class 4d also includes the same proportion of 57.4land as the qualifying low-income rental housing units are to the total units in the building. 57.5For all properties qualifying as class 4d, the market value determined by the assessor must 57.6be based on the normal approach to value using normal unrestricted rents.57.7    (f) The first tier of market value of class 4d property has a class rate of 0.75 percent.57.8 The remaining value of class 4d property has a class rate of 0.25 percent. For the purposes 57.9of this paragraph, the "first tier of market value of class 4d property" means the market 57.10value of each housing unit up to the first tier limit. For the purposes of this paragraph, all 57.11class 4d property value must be assigned to individual housing units. The first tier limit is 57.12$100,000 for assessment year 2014. For subsequent years, the limit is adjusted each year 57.13by the average statewide change in estimated market value of property classified as class 4a 57.14and 4d under this section for the previous assessment year, excluding valuation change due 57.15to new construction, rounded to the nearest $1,000, provided, however, that the limit may 57.16never be less than $100,000. Beginning with assessment year 2015, the commissioner of 57.17revenue must certify the limit for each assessment year by November 1 of the previous year.57.18EFFECTIVE DATE.This section is effective beginning with assessment year 2014.57.19    Sec. 19. Minnesota Statutes 2012, section 279.01, subdivision 1, is amended to read:57.20    Subdivision 1. Due dates; penalties. Except as provided in subdivision subdivisions57.21 3 or 4 to 5, on May 16 or 21 days after the postmark date on the envelope containing the 57.22property tax statement, whichever is later, a penalty accrues and thereafter is charged upon 57.23all unpaid taxes on real estate on the current lists in the hands of the county treasurer. The 57.24penalty is at a rate of two percent on homestead property until May 31 and four percent on 57.25June 1. The penalty on nonhomestead property is at a rate of four percent until May 31 and 57.26eight percent on June 1. This penalty does not accrue until June 1 of each year, or 21 days 57.27after the postmark date on the envelope containing the property tax statements, whichever 57.28is later, on commercial use real property used for seasonal residential recreational purposes 57.29and classified as class 1c or 4c, and on other commercial use real property classified as 57.30class 3a, provided that over 60 percent of the gross income earned by the enterprise on the 57.31class 3a property is earned during the months of May, June, July, and August. In order for 57.32the first half of the tax due on class 3a property to be paid after May 15 and before June 1, 57.33or 21 days after the postmark date on the envelope containing the property tax statement, 57.34whichever is later, without penalty, the owner of the property must attach an affidavit 57.35to the payment attesting to compliance with the income provision of this subdivision. 58.1Thereafter, for both homestead and nonhomestead property, on the first day of each month 58.2beginning July 1, up to and including October 1 following, an additional penalty of one 58.3percent for each month accrues and is charged on all such unpaid taxes provided that if the 58.4due date was extended beyond May 15 as the result of any delay in mailing property tax 58.5statements no additional penalty shall accrue if the tax is paid by the extended due date. If 58.6the tax is not paid by the extended due date, then all penalties that would have accrued if 58.7the due date had been May 15 shall be charged. When the taxes against any tract or lot 58.8exceed $100, one-half thereof may be paid prior to May 16 or 21 days after the postmark 58.9date on the envelope containing the property tax statement, whichever is later; and, if so 58.10paid, no penalty attaches; the remaining one-half may be paid at any time prior to October 58.1116 following, without penalty; but, if not so paid, then a penalty of two percent accrues 58.12thereon for homestead property and a penalty of four percent on nonhomestead property. 58.13Thereafter, for homestead property, on the first day of November an additional penalty of 58.14four percent accrues and on the first day of December following, an additional penalty of 58.15two percent accrues and is charged on all such unpaid taxes. Thereafter, for nonhomestead 58.16property, on the first day of November and December following, an additional penalty of 58.17four percent for each month accrues and is charged on all such unpaid taxes. If one-half of 58.18such taxes are not paid prior to May 16 or 21 days after the postmark date on the envelope 58.19containing the property tax statement, whichever is later, the same may be paid at any time 58.20prior to October 16, with accrued penalties to the date of payment added, and thereupon 58.21no penalty attaches to the remaining one-half until October 16 following.58.22    This section applies to payment of personal property taxes assessed against 58.23improvements to leased property, except as provided by section 
         277.01, subdivision 3.58.24    A county may provide by resolution that in the case of a property owner that has 58.25multiple tracts or parcels with aggregate taxes exceeding $100, payments may be made in 58.26installments as provided in this subdivision.58.27    The county treasurer may accept payments of more or less than the exact amount of 58.28a tax installment due. Payments must be applied first to the oldest installment that is due 58.29but which has not been fully paid. If the accepted payment is less than the amount due, 58.30payments must be applied first to the penalty accrued for the year or the installment being 58.31paid. Acceptance of partial payment of tax does not constitute a waiver of the minimum 58.32payment required as a condition for filing an appeal under section 
         278.03 or any other law, 58.33nor does it affect the order of payment of delinquent taxes under section 
         280.39.58.34    Sec. 20. Minnesota Statutes 2012, section 279.01, is amended by adding a subdivision 58.35to read:59.1    Subd. 5.Federal active service exception.In the case of a homestead property 59.2owned by an individual who is on federal active service, as defined in section 190.05, 59.3subdivision 5c, as a member of the National Guard or a reserve component, a four-month 59.4grace period is granted for complying with the due dates imposed by subdivision 1. During 59.5this period, no late fees or penalties shall accrue against the property. The due date for 59.6property taxes owed under this chapter for an individual covered by this subdivision shall 59.7be September 15 for taxes due on May 15, and February 15 of the following year for taxes 59.8due on October 15. A taxpayer making a payment under this subdivision must accompany 59.9the payment with a signed copy of the taxpayer's orders or form DD214 showing the 59.10dates of active service which clearly indicate that the taxpayer was in active service as a 59.11member of the National Guard or a reserve component on the date the payment was due. 59.12This grace period applies to all homestead property owned by individuals on federal active 59.13service, as herein defined, for all of that property's due dates which fall on a day that is 59.14included in the taxpayer's federal active service.59.15    Sec. 21. Minnesota Statutes 2012, section 279.02, is amended to read:59.16279.02 DUTIES OF COUNTY AUDITOR AND TREASURER.59.17    Subdivision 1.Delinquent property; rates. On the first business day in January, of 59.18each year, the county treasurer shall return the tax lists on hand to the county auditor, who 59.19shall compare the same with the statements receipted for by the treasurer on file in the 59.20auditor's office and each tract or lot of real property against which the taxes, or any part 59.21thereof, remain unpaid, shall be deemed delinquent, and thereupon an additional penalty 59.22of two percent on the amount of the original tax remaining unpaid shall immediately 59.23accrue and thereafter be charged upon all such delinquent taxes; and any auditor who 59.24shall make out and deliver any statement of delinquent taxes without including therein 59.25the penalties imposed by law, and any treasurer who shall receive payment of such taxes 59.26without including in such payment all items as shown on the auditor's statement, shall be 59.27liable to the county for the amounts of any items omitted.59.28    Subd. 2.Federal active service exception.Notwithstanding subdivision 1, a 59.29homestead property owned by an individual who is on federal active service, as defined 59.30in section 190.05, subdivision 5c, as a member of the National Guard or a reserve 59.31component, shall not be deemed delinquent under this section if the due dates imposed 59.32under section 279.01 fall on a day in which the individual was on federal active service.59.33    Sec. 22. Minnesota Statutes 2012, section 279.37, subdivision 1a, is amended to read:60.1    Subd. 1a. Class 3a property. (a) The delinquent taxes upon a parcel of property 60.2which was classified class 3a, for the previous year's assessment and had a total market 60.3value of $500,000 or less for that same assessment shall be eligible to be composed into a 60.4confession of judgment with the approval of the county auditor. Property qualifying under 60.5this subdivision shall be subject to the same provisions as provided in this section except 60.6as provided in paragraphs (b) to (d) (f).60.7    (b) Current year taxes and penalty due at the time the confession of judgment 60.8is entered must be paid.60.9    (c) The down payment must include all special assessments due in the current tax 60.10year, all delinquent special assessments, and 20 percent of the ad valorem tax, penalties, 60.11and interest accrued against the parcel. The balance remaining is payable in four equal 60.12annual installments. A municipality as defined in section 429.011, cities of the first class, 60.13and other special assessment authorities, that have certified special assessments against 60.14any parcel of property, may, through resolution, waive the requirement of payment of all 60.15current and delinquent special assessments at the time the confession is entered. If the 60.16municipality, city, or authority grants the waiver, 100 percent of all current year taxes, 60.17special assessments, and penalties due at the time, along with 20 percent of all delinquent 60.18taxes, special assessments, penalties, interest, and fees must be paid. The balance 60.19remaining shall be subject to and included in the installment plan.60.20(d) When there are current and delinquent special assessments certified and billed 60.21against a parcel, the assessment authority or municipality as defined in section 429.011 60.22may abate under section 375.192, subdivision 2, all special assessments and the penalty 60.23and interest affiliated with the special assessments, and reassess the special assessments, 60.24penalties, and interest accrued thereon, under section 429.071, subdivision 2. The 60.25municipality shall notify the county auditor of its intent to reassess as a precondition 60.26to the entry of the confession of judgment. Upon the notice to abate and reassess, the 60.27municipality shall, through resolution, notify the county auditor to remove all current 60.28and delinquent special assessments and the accrued penalty and interest on the special 60.29assessments, and the payment of all or a portion of the current and delinquent assessments 60.30shall not be required as part of the down payment due at the time the confession of 60.31judgment is entered in accordance with paragraph (c).60.32    (d) (e) The amounts entered in judgment bear interest at the rate provided in section 60.33279.03, subdivision 1a
         , commencing with the date the judgment is entered. The interest 60.34rate is subject to change each year on the unpaid balance in the manner provided in section 60.35279.03, subdivision 1a
         .61.1(f) The county auditor may require conditions on properties including, but not 61.2limited to, environmental remediation action plan requirements, restrictions, or covenants, 61.3when considering a request for approval of eligibility for composition into a confession of 61.4judgment for delinquent taxes upon a parcel of property which was classified class 3a for 61.5the previous year's assessment.61.6    Sec. 23. Minnesota Statutes 2012, section 279.37, subdivision 2, is amended to read:61.7    Subd. 2. Installment payments. The owner of any such parcel, or any person to 61.8whom the right to pay taxes has been given by statute, mortgage, or other agreement, may 61.9make and file with the county auditor of the county in which the parcel is located a written 61.10offer to pay the current taxes each year before they become delinquent, or to contest the 61.11taxes under Minnesota Statutes 1941, sections 
         278.01 to 
         278.13, and agree to confess 61.12judgment for the amount provided, as determined by the county auditor. By filing the 61.13offer, the owner waives all irregularities in connection with the tax proceedings affecting 61.14the parcel and any defense or objection which the owner may have to the proceedings, and 61.15also waives the requirements of any notice of default in the payment of any installment or 61.16interest to become due pursuant to the composite judgment to be so entered. Unless the 61.17property is subject to subdivision 1a, with the offer, the owner shall (i) tender one-tenth of 61.18the amount of the delinquent taxes, costs, penalty, and interest, and shall (ii) tender all 61.19current year taxes and penalty due at the time the confession of judgment is entered. In the 61.20offer, the owner shall agree to pay the balance in nine equal installments, with interest as 61.21provided in section 
         279.03, payable annually on installments remaining unpaid from time 61.22to time, on or before December 31 of each year following the year in which judgment 61.23was confessed. The offer must be substantially as follows:61.24"To the court administrator of the district court of ........... county, I, ....................., 61.25am the owner of the following described parcel of real estate located in .................... 61.26county, Minnesota:61.27.............................. Upon that real estate there are delinquent taxes for the year ........., and 61.28prior years, as follows: (here insert year of delinquency and the total amount of delinquent 61.29taxes, costs, interest, and penalty). By signing this document I offer to confess judgment in 61.30the sum of $...... and waive all irregularities in the tax proceedings affecting these taxes and 61.31any defense or objection which I may have to them, and direct judgment to be entered for 61.32the amount stated above, minus the sum of $............, to be paid with this document, which 61.33is one-tenth or one-fifth of the amount of the taxes, costs, penalty, and interest stated above. 61.34I agree to pay the balance of the judgment in nine or four equal, annual installments, with 61.35interest as provided in section 
         279.03, payable annually, on the installments remaining 62.1unpaid. I agree to pay the installments and interest on or before December 31 of each year 62.2following the year in which this judgment is confessed and current taxes each year before 62.3they become delinquent, or within 30 days after the entry of final judgment in proceedings 62.4to contest the taxes under Minnesota Statutes, sections 
         278.01 to 
         278.13.62.5Dated .............., ......."62.6    Sec. 24. Minnesota Statutes 2012, section 281.14, is amended to read:62.7281.14 EXPIRATION OF TIME FOR REDEMPTION.62.8The time for redemption from any tax sale, whether made to the state or to a private 62.9person, shall not expire until notice of expiration of redemption, as provided in section 62.10281.13 281.17, shall have been given.62.11    Sec. 25. Minnesota Statutes 2012, section 281.17, is amended to read:62.12281.17 PERIOD FOR REDEMPTION.62.13Except for properties for which the period of redemption has been limited under 62.14sections 
         281.173 and 
         281.174, the following periods for redemption apply.62.15The period of redemption for all lands sold to the state at a tax judgment sale shall 62.16be three years from the date of sale to the state of Minnesota if the land is within an 62.17incorporated area unless it is: (a) nonagricultural homesteaded land as defined in section 62.18273.13, subdivision 22; (b) homesteaded agricultural land as defined in section 273.13, 62.19subdivision 23, paragraph (a); or (c) seasonal residential recreational land as defined in 62.20section 273.13, subdivision 22, paragraph (c), or 25, paragraph (d), clause (1), for which 62.21the period of redemption is five years from the date of sale to the state of Minnesota.62.22The period of redemption for homesteaded lands as defined in section 
         273.13, 62.23subdivision 22
         , located in a targeted neighborhood as defined in Laws 1987, chapter 386, 62.24article 6, section 4, and sold to the state at a tax judgment sale is three years from the date 62.25of sale. The period of redemption for all lands located in a targeted neighborhood as 62.26defined in Laws 1987, chapter 386, article 6, section 4, except (1) homesteaded lands as 62.27defined in section 
         273.13, subdivision 22, and (2) for periods of redemption beginning 62.28after June 30, 1991, but before July 1, 1996, lands located in the Loring Park targeted 62.29neighborhood on which a notice of lis pendens has been served, and sold to the state at a 62.30tax judgment sale is one year from the date of sale.62.31The period of redemption for all real property constituting a mixed municipal solid 62.32waste disposal facility that is a qualified facility under section 
         115B.39, subdivision 1, is 62.33one year from the date of the sale to the state of Minnesota.63.1The period of redemption for all other lands sold to the state at a tax judgment 63.2sale shall be five years from the date of sale, except that the period of redemption for 63.3nonhomesteaded agricultural land as defined in section 273.13, subdivision 23, paragraph 63.4(b), shall be two years from the date of sale if at that time that property is owned by a 63.5person who owns one or more parcels of property on which taxes are delinquent, and the 63.6delinquent taxes are more than 25 percent of the prior year's school district levy.63.7    Sec. 26. Minnesota Statutes 2012, section 287.05, is amended by adding a subdivision 63.8to read:63.9    Subd. 10.Hennepin and Ramsey Counties.For properties located in Hennepin 63.10and Ramsey Counties, the county may impose an additional mortgage registry tax as 63.11defined in sections 383A.80 and 383B.80.63.12EFFECTIVE DATE.This section is effective for deeds and mortgages 63.13acknowledged on or after July 1, 2013.63.14    Sec. 27. [287.40] HENNEPIN AND RAMSEY COUNTIES.63.15    For properties located in Hennepin and Ramsey Counties, the county may impose an 63.16additional deed tax as defined in sections 383A.80 and 383B.80.63.17EFFECTIVE DATE.This section is effective for deeds and mortgages 63.18acknowledged on or after July 1, 2013.63.19    Sec. 28. Minnesota Statutes 2012, section 383A.80, subdivision 4, is amended to read:63.20    Subd. 4. Expiration. The authority to impose the tax under this section expires 63.21January 1, 2013 2028.63.22EFFECTIVE DATE.This section is effective for all deeds and mortgages 63.23acknowledged on or after July 1, 2013.63.24    Sec. 29. Minnesota Statutes 2012, section 383B.80, subdivision 4, is amended to read:63.25    Subd. 4. Expiration. The authority to impose the tax under this section expires 63.26January 1, 2013 2028.63.27EFFECTIVE DATE.This section is effective for all deeds and mortgages 63.28acknowledged on or after July 1, 2013.63.29    Sec. 30. Minnesota Statutes 2012, section 428A.101, is amended to read:64.1428A.101 DEADLINE FOR SPECIAL SERVICE DISTRICT UNDER 64.2GENERAL LAW.64.3The establishment of a new special service district after June 30, 2013 2028, requires 64.4enactment of a special law authorizing the establishment.64.5EFFECTIVE DATE.This section is effective the day following final enactment.64.6    Sec. 31. Minnesota Statutes 2012, section 428A.21, is amended to read:64.7428A.21 DEADLINE FOR HOUSING IMPROVEMENT DISTRICTS UNDER 64.8GENERAL LAW.64.9The establishment of a new housing improvement area after June 30, 2013 2028, 64.10requires enactment of a special law authorizing the establishment of the area.64.11EFFECTIVE DATE.This section is effective the day following final enactment.64.12    Sec. 32. Minnesota Statutes 2012, section 473F.08, subdivision 3a, is amended to read:64.13    Subd. 3a. Bloomington computation.(a) Beginning in 1987 and each subsequent 64.14year through 1998, the city of Bloomington shall determine the interest payments for that 64.15year for the bonds which have been sold for the highway improvements pursuant to Laws 64.161986, chapter 391, section 2, paragraph (g). Effective for property taxes payable in 1988 64.17through property taxes payable in 1999, after the Hennepin County auditor has computed 64.18the areawide portion of the levy for the city of Bloomington pursuant to subdivision 3, 64.19clause (a), the auditor shall annually add a dollar amount to the city of Bloomington's 64.20areawide portion of the levy equal to the amount which has been certified to the auditor 64.21by the city of Bloomington for the interest payments for that year for the bonds which 64.22were sold for highway improvements. The total areawide portion of the levy for the city 64.23of Bloomington including the additional amount for interest repayment certified pursuant 64.24to this subdivision shall be certified by the Hennepin County auditor to the administrative 64.25auditor pursuant to subdivision 5. The Hennepin County auditor shall distribute to the 64.26city of Bloomington the additional areawide portion of the levy computed pursuant to this 64.27subdivision at the same time that payments are made to the other counties pursuant to 64.28subdivision 7a. For property taxes payable from the year 2009 through 2018 2014, the 64.29Hennepin County auditor shall adjust Bloomington's contribution to the areawide gross tax 64.30capacity upward each year by a value equal to ten percent of the total additional areawide 64.31levy distributed to Bloomington under this subdivision from 1988 to 1999, divided by the 64.32areawide tax rate for taxes payable in the previous year.65.1(b) For property taxes payable from 2015 through 2018, the administrative auditor 65.2shall increase the areawide net tax capacity each year by an amount equal to ten percent of 65.3the total additional areawide levy distributed to Bloomington under this subdivision from 65.41988 to 1999, divided by the areawide tax rate for taxes payable in the previous year. The 65.5administrative auditor must notify the commissioner of revenue of the amount determined 65.6by multiplying the increase in the areawide net tax capacity by the areawide tax rate 65.7determined under subdivision 5. The commissioner of revenue must pay the amount 65.8determined each payable year to the administrative auditor in two installments on July 10 65.9and November 10, for distribution and settlement as provided in subdivision 7a.65.10(c) A sum sufficient to meet the obligations under this subdivision is annually 65.11appropriated from the general fund to the commissioner of revenue.65.12EFFECTIVE DATE.This section is effective beginning with taxes payable in 2015.65.13    Sec. 33. Laws 1988, chapter 645, section 3, as amended by Laws 1999, chapter 243, 65.14article 6, section 9, Laws 2000, chapter 490, article 6, section 15, and Laws 2008, chapter 65.15154, article 2, section 30, is amended to read:65.16    Sec. 3. TAX; PAYMENT OF EXPENSES.65.17    (a) The tax levied by the hospital district under Minnesota Statutes, section 
         447.34, 65.18must not be levied at a rate that exceeds the amount authorized to be levied under that 65.19section. The proceeds of the tax may be used for all purposes of the hospital district, 65.20except as provided in paragraph (b).65.21    (b) 0.015 percent of taxable market value of the tax in paragraph (a) may be used 65.22solely by the Cook ambulance service and the Orr ambulance service for the purpose of 65.23capital expenditures as it relates to:65.24    (1) ambulance acquisitions for the Cook ambulance service and the Orr ambulance 65.25service and not;65.26    (2) attached and portable equipment for use in and for the ambulances; and65.27    (3) parts and replacement parts for maintenance and repair of the ambulances.65.28The money may not be used for administrative, operation,  or salary expenses.65.29    (c) The part of the levy referred to in paragraph (b) must be administered by the 65.30Cook Hospital and passed on in equal amounts directly to the Cook area ambulance 65.31service board and the city of Orr to be held in trust until funding for a new ambulance is 65.32needed by either the Cook ambulance service or the Orr ambulance service used for the 65.33purposes in paragraph (b).65.34    Sec. 34. Laws 1999, chapter 243, article 6, section 11, is amended to read:66.1    Sec. 11. CEMETERY LEVY FOR SAWYER BY CARLTON COUNTY.66.2    Subdivision 1.Levy authorized. Notwithstanding other law to the contrary, the 66.3Carlton county board of commissioners may annually levy in and for the unorganized 66.4township territory of Sawyer an amount up to $1,000 annually for cemetery purposes, 66.5beginning with taxes payable in 2000 and ending with taxes payable in 2009.66.6    Subd. 2.Effective date.This section is effective June 1, 1999, without local 66.7approval.66.8EFFECTIVE DATE; LOCAL APPROVAL.This section applies to taxes 66.9payable in 2014 and thereafter, and is effective the day after the Carlton County Board 66.10of Commissioners and its chief clerical officer timely complete their compliance with 66.11Minnesota Statutes, section 645.021, subdivisions 2 and 3.66.12    Sec. 35. Laws 2008, chapter 366, article 5, section 33, the effective date, is amended to 66.13read:66.14EFFECTIVE DATE.This section is effective for taxes levied in 2008, payable in 66.152009, and is repealed effective for taxes levied in 2013 2018, payable in 2014 2019, 66.16and thereafter.66.17EFFECTIVE DATE.This section is effective beginning with taxes payable in 2014.66.18    Sec. 36. Laws 2009, chapter 88, article 2, section 46, subdivision 1, is amended to read:66.19    Subdivision 1. Agreement. The city of Cloquet and Perch Lake Township, by 66.20resolution of each of their governing bodies, may establish the Cloquet Area Fire and 66.21Ambulance Taxing District for the purpose of providing fire and or ambulance services, 66.22or both,  throughout the district. In this section, "municipality" means home rule charter 66.23and statutory cities, towns, and Indian tribes. The district may exercise all the powers 66.24relating to fire and ambulance services of the municipalities that receive fire and or66.25 ambulance services, or both,  from the district. Upon application, any other municipality 66.26that is contiguous to a municipality that is a member of the district may join the district 66.27with the agreement of the municipalities that comprise the district at the time of its 66.28application to join.66.29    Sec. 37. Laws 2009, chapter 88, article 2, section 46, subdivision 3, is amended to read:66.30    Subd. 3. Tax. The district board may impose a property tax on taxable property in 66.31the district as provided in this subdivision. This The board shall annually determine the 66.32total amount of the levy that is attributable to the cost of providing fire services and the cost 67.1of providing ambulance services within the primary service area. For those municipalities 67.2that only receive ambulance services, the costs for the provision of ambulance services 67.3shall be levied against taxable property within those municipalities at a rate necessary not 67.4to exceed 0.019 percent of the estimated market value. For those municipalities that 67.5receive both fire and ambulance services, the tax shall be imposed at a rate that does not 67.6exceed 0.2835 percent of taxable estimated market value for taxes payable in 2010. The 67.7board shall annually determine the separate amounts of the levy that are attributable to the 67.8cost of providing fire services and the cost of providing ambulance services. Costs for the 67.9provision of ambulance services shall be levied against taxable property within the area of 67.10the district that receive the services. Costs for the provision of fire services shall be levied 67.11against taxable property within the area of the district that receive the services.67.12When a member municipality opts to receive fire service from the district or an 67.13additional municipality becomes a member of the district, the additional cost of providing 67.14ambulance and fire services to that municipality will community shall be determined by 67.15the board and added to the maximum levy amount.67.16Each county auditor of a county that contains a municipality subject to the tax under 67.17this section must collect the tax and pay it to the Fire and Ambulance Special Taxing 67.18District. The district may also impose other fees or charges as allowed by law for the 67.19provision of fire and ambulance services.67.20    Sec. 38. Laws 2010, chapter 389, article 1, section 12, the effective date, is amended to 67.21read:67.22EFFECTIVE DATE.This section is effective for assessment years year 2010 and 67.232011, for taxes payable in 2011 and 2012 thereafter.67.24EFFECTIVE DATE.This section is effective for assessment year 2012 and 67.25thereafter.67.26    Sec. 39. MINNEAPOLIS AND ST. PAUL ENTERTAINMENT FACILITIES 67.27COORDINATION STUDY; APPROPRIATION.67.28    Subdivision 1.Statement of purpose.The legislature finds that the national 67.29economic structure of professional sports financing, as directly or indirectly sanctioned by 67.30federal law, compels state and local governments in smaller metropolitan areas, such as 67.31Minneapolis and St. Paul, to help finance the construction and operation of venues for 67.32professional sports franchises as a condition of hosting these franchises. The burden and 67.33risk associated with providing this assistance justifies authorizing and directing the cities 68.1and any associated private entities to enter into arrangements that attempt to maximize 68.2the combined revenues of these facilities from direct users, including those unrelated to 68.3professional sports, such as, but not limited to, joint booking of concerts and other events, 68.4to minimize the cost and risk to general taxpayers. Any efforts to put in place such joint 68.5marketing, promotion, and scheduling arrangements by the cities or associated private 68.6entities, in the view of the legislature, is a petition for enactment of this or subsequent 68.7enabling legislation under the Noerr-Pennington doctrine or state action under the Parker 68.8antitrust doctrine. This legislation and any resulting arrangements are intended to minimize 68.9the potential burden on general taxpayers of financing and operation of the arenas.68.10    Subd. 2.Study and report.On or before February 1, 2014, the cities of 68.11Minneapolis and St. Paul, in consultation with representatives of the primary professional 68.12sports team tenant of each arena, shall study and report to the legislature on establishing 68.13a joint governing structure to be responsible for the joint administration, financing, and 68.14operations of the facilities and the possible effects of joint governance on the finances of 68.15each arena and each city. The commissioner of administration, in consultation with the 68.16two cities, shall contract with an independent consultant to conduct all or a portion of the 68.17study. The cities of Minneapolis and St. Paul together shall pay one-half of the cost of the 68.18consultant contract. The commissioner may accept funding from other public entities and 68.19private organizations to pay for the contract. The study must:68.20    (1) examine the current finances of each arena including past and projected costs and 68.21revenues, projected capital improvements, and the current and projected impact of each 68.22arena on each city's general fund;68.23    (2) determine the impact of joint governance on the future finances of each city;68.24    (3) examine joint scheduling, marketing, and promotion of events at the arenas, 68.25either within a joint governance structure or as separate entities; and68.26    (4) estimate the amount of funding, if any, that would be required to operate and 68.27maintain the arenas under a joint governing structure.68.28    Subd. 3.Appropriation.Up to $50,000 is appropriated to the commissioner of 68.29administration from the general fund for fiscal year 2014 to pay up to one-half of the costs 68.30of the consultant contract under subdivision 2.68.31EFFECTIVE DATE.This section is effective the day following final enactment.68.32    Sec. 40. REIMBURSEMENT FOR PROPERTY TAX ABATEMENTS; 68.33APPROPRIATION.69.1    Subdivision 1.Reimbursement.The commissioner of revenue shall reimburse 69.2taxing jurisdictions for property tax abatements granted in Hennepin County under Laws 69.32011, First Special Session chapter 7, article 5, section 13, notwithstanding the time limits 69.4contained in that section. The reimbursements must be made to each taxing jurisdiction 69.5pursuant to the certification of the Hennepin County auditor.69.6    Subd. 2.Appropriation.In fiscal year 2014 only, $336,000 is appropriated to the 69.7commissioner of revenue from the general fund to make the payments required in this 69.8section.69.9EFFECTIVE DATE.This section is effective the day following final enactment.69.10    Sec. 41. ST. PAUL BALLPARK PROPERTY TAX EXEMPTION; SPECIAL 69.11ASSESSMENT.69.12Any real or personal property acquired, owned, leased, controlled, used, or occupied 69.13by the city of St. Paul for the primary purpose of providing a ballpark for a minor league 69.14baseball team is declared to be acquired, owned, leased, controlled, used, and occupied for 69.15public, governmental, and municipal purposes, and is exempt from ad valorem taxation 69.16by the state or any political subdivision of the state, provided that the properties are 69.17subject to special assessments levied by a political subdivision for a local improvement in 69.18amounts proportionate to and not exceeding the special benefit received by the properties 69.19from the improvement. In determining the special benefit received by the properties, no 69.20possible use of any of the properties in any manner different from their intended use 69.21for providing a minor league ballpark at the time may be considered. Notwithstanding 69.22Minnesota Statutes, section 272.01, subdivision 2, or 273.19, real or personal property 69.23subject to a lease or use agreement between the city and another person for uses related to 69.24the purposes of the operation of the ballpark and related parking facilities is exempt from 69.25taxation regardless of the length of the lease or use agreement. This section, insofar as it 69.26provides an exemption or special treatment, does not apply to any real property that is 69.27leased for residential, business, or commercial development or other purposes different 69.28from those necessary to the provision and operation of the ballpark.69.29EFFECTIVE DATE.This section is effective the day after compliance by the 69.30governing body of the city of St. Paul with Minnesota Statutes, section 645.021, 69.31subdivisions 2 and 3.69.32    Sec. 42. PUBLIC ENTERTAINMENT FACILITY; PROPERTY TAX 69.33EXEMPTION; SPECIAL ASSESSMENT.70.1Any real or personal property acquired, owned, leased, controlled, used, or occupied 70.2by the city of Minneapolis for the primary purpose of providing an arena for a professional 70.3basketball team is declared to be acquired, owned, leased, controlled, used, and occupied 70.4for public, governmental, and municipal purposes, and is exempt from ad valorem taxation 70.5by the state or any political subdivision of the state, provided that the properties are 70.6subject to special assessments levied by a political subdivision for a local improvement in 70.7amounts proportionate to and not exceeding the special benefit received by the properties 70.8from the improvement. In determining the special benefit received by the properties, no 70.9possible use of any of the properties in any manner different from their intended use for 70.10providing a professional basketball arena at the time may be considered. Notwithstanding 70.11Minnesota Statutes, section 272.01, subdivision 2, or 273.19, real or personal property 70.12subject to a lease or use agreement between the city and another person for uses related to 70.13the purposes of the operation of the arena and related parking facilities is exempt from 70.14taxation regardless of the length of the lease or use agreement. This section, insofar as 70.15it provides an exemption or special treatment, does not apply to any real property that 70.16is leased for residential, business, or commercial development, or for other purposes 70.17different from those necessary to the provision and operation of the arena.70.18EFFECTIVE DATE.This section is effective the day after compliance by the 70.19governing body of the city of Minneapolis with Minnesota Statutes, section 645.021, 70.20subdivisions 2 and 3.70.21    Sec. 43. PUBLIC ENTERTAINMENT FACILITY; CONSTRUCTION 70.22MANAGER AT RISK.70.23(a) For any real or personal property acquired, owned, leased, controlled, used, or 70.24occupied by the city of Minneapolis for the primary purpose of providing an arena for 70.25a professional basketball team, the city of Minneapolis may contract for construction, 70.26materials, supplies, and equipment in accordance with Minnesota Statutes, section 70.27471.345, except that the city may employ or contract with persons, firms, or corporations 70.28to perform one or more or all of the functions of an engineer, architect, construction 70.29manager, or program manager with respect to all or any part of a project to renovate, 70.30refurbish, and remodel the arena under either the traditional design-bid-build plan or 70.31construction manager at risk plan, or a combination thereof.70.32(b) The city may prepare a request for proposals for one or more of the functions 70.33described in paragraph (a). The request must be published in a newspaper of general 70.34circulation. The city may prequalify offerors by issuing a request for qualifications, in 71.1advance of the request for proposals, and select a short list of responsible offerors to 71.2submit proposals.71.3(c) As provided in the request for proposals, the city may conduct discussions and 71.4negotiations with responsible offerors in order to determine which proposal is most 71.5advantageous to the city and to negotiate the terms of an agreement. In conducting 71.6discussions, there shall be no disclosure of any information derived from proposals 71.7submitted by competing offerors and the content of all proposals is nonpublic data under 71.8Minnesota Statutes, chapter 13, until such time as a notice to award a contract is given 71.9by the city.71.10(d) Upon agreement on the guaranteed maximum price, the construction manager 71.11or program manager may enter into contracts with subcontractors for labor, materials, 71.12supplies, and equipment for the renovation project through the process of public bidding, 71.13except that the construction manager or program manager may, with the consent of the city:71.14(1) narrow the listing of eligible bidders to those that the construction manager 71.15or program manager determines to possess sufficient expertise to perform the intended 71.16functions;71.17(2) award contracts to the subcontractors that the construction manager or program 71.18manager determines provide the best value under a request for proposals, as described in 71.19Minnesota Statutes, section 16C.28, subdivision 1, paragraph (a), clause (2), that are not 71.20required to be the lowest responsible bidder; and71.21(3) for work the construction manager or program manager determines to be 71.22critical to the completion schedule, perform work with its own forces without soliciting 71.23competitive bids or proposals, if the construction manager or program manager provides 71.24evidence of competitive pricing.71.25EFFECTIVE DATE.This section is effective the day after compliance by the 71.26governing body of the city of Minneapolis with Minnesota Statutes, section 645.021, 71.27subdivisions 2 and 3.71.28    Sec. 44. EXTENSION OF PROPERTY TAX DUE DATE; COMMERCIAL 71.29SEASONAL RECREATIONAL PROPERTIES.71.30Notwithstanding the provisions of Minnesota Statutes, section 279.01, subdivision 71.311, for taxes payable in 2013 only, the penalty on first-half property taxes does not accrue 71.32until June 15 on commercial use real property used for seasonal residential recreational 71.33purposes and classified as class 1c or 4c, and on other commercial use real property 71.34classified as class 3a, provided that over 60 percent of the gross income earned by the 71.35enterprise on the class 3a property is earned during the months of May, June, July, and 72.1August. In order for the first half of the tax due on class 3a property to be paid after May 72.215 and before June 15 without penalty, the owner of the property must attach an affidavit 72.3to the payment attesting to compliance with the income provision of this subdivision.72.4EFFECTIVE DATE.This section is effective the day following final enactment.72.5    Sec. 45. REPORT ON CLASS 4D TIER STRUCTURE.72.6The commissioners of revenue and housing finance shall report to the legislature 72.7by January 31, 2015, on the implementation of a second tier of market value for class 4d 72.8property under Minnesota Statutes, section 273.13, subdivision 25, paragraph (f). The 72.9report shall include the number of class 4d properties subject to the second tier of market 72.10value for taxes payable in 2015 and the tax impact of the application of the second tier 72.11of market value. The report shall also include an analysis of the characteristics of the 72.12properties to which the second tier of market value applies, such as location, building 72.13type, and number of units.72.14EFFECTIVE DATE.This section is effective July 1, 2013.72.15    Sec. 46. REPORT AND STUDY ON CERTAIN PROPERTY USED IN 72.16BUSINESS AND PRODUCTION; ASSESSMENT MORATORIUM.72.17    Subdivision 1.Study and report.(a) In order to facilitate a legislative review of 72.18property tax assessment procedures for facilities used in the production of biofuels, wine, 72.19beer, distilled beverages, and dairy products, and the development of standards and criteria 72.20for determining the taxable status of these facilities, the commissioner of revenue must 72.21conduct a study and report the findings of the study. The study must:72.22(1) include a detailed survey of counties identifying the components and tax status 72.23of biofuel facilities;72.24(2) identify the function of components in facilities of the affected industries;72.25(3) consider the taxability for certain components related to size, function, and use;72.26(4) develop recommendations for assessment guidelines and policies for facilities of 72.27the affected industries; and72.28(5) identify possible impacts to state and local taxes resulting from study 72.29recommendations.72.30(b) The commissioner shall request the involvement and participation of 72.31stakeholders, including the affected industries, the assessment community, and others 72.32identified by the commissioner.73.1(c) The commissioner shall report the findings to the chairs of the house of 73.2representatives and senate committees with jurisdiction over taxes, agriculture, and 73.3economic development as well as the commissioners of agriculture and employment and 73.4economic development by February 1, 2014.73.5    Subd. 2.Moratorium on changes in assessment practices.(a) For the 2013 and 73.62014 assessments, assessors must continue to use assessment practices or policies in effect 73.7in that county on January 2, 2012, for determining the taxable status of property used in 73.8the production of biofuels, wine, beer, distilled beverages, or dairy products.73.9(b) An assessor must not change the taxable status of any existing property described 73.10in paragraph (a) from its status on January 2, 2012, unless the change is due to a change in 73.11the use of property, or to correct an error. For taxable properties, the assessor may change 73.12the estimated market value of the property and add value for any new construction that 73.13would have been taxable under practices and policies in place on January 2, 2012.73.14(c) This subdivision expires on December 31, 2014. Any changes to the taxable 73.15status of the properties in paragraph (a) resulting from the study will not be effective 73.16until the 2015 assessment.73.17    Sec. 47. PROPERTY TAX SAVINGS REPORT.73.18(a) In addition to the certification of its proposed property tax levy under Minnesota 73.19Statutes, section 275.065, each city that has a population over 500 and each county shall 73.20also include the amount of sales and use tax paid, or was estimated to be paid, in 2012.73.21(b) At the time the notice of the proposed property taxes is mailed as required under 73.22Minnesota Statutes, section 275.065, subdivision 3, the county treasurer shall also include 73.23a separate statement providing a list of sales and use tax certified by the county and cities 73.24within their jurisdiction.73.25(c) At the public hearing required under Minnesota Statutes, section 275.065, 73.26subdivision 3, the county and city must discuss the estimated savings realized to their 73.27budgets that resulted from the sales tax exemption authorized under Minnesota Statutes, 73.28section 297A.70, subdivision 2, and how those savings will be used for property tax levy 73.29reductions, fee reductions, and other purposes as deemed appropriate.73.30Reasonable costs of preparing the notice required in this section must be apportioned 73.31between taxing jurisdictions as follows:73.32(1) one-half is allocated to the county; and73.33(2) one-half is allocated among the cities.74.1The amount allocated in clause (2) must be further apportioned among all the cities 74.2in the proportion that the number of parcels in the city bears to the number of parcels in all 74.3the cities that have populations over 500.74.4EFFECTIVE DATE.This section is effective the day following final enactment, 74.5for taxes levied in 2013 and payable in 2014.74.6    Sec. 48. LEVY LIMITS FOR TAXES LEVIED IN 2013.74.7    Subdivision 1. Population."Population" means the population for the local 74.8governmental unit as established by the last federal census, by a census taken under 74.9section Minnesota Statutes, section 275.14, or by an estimate made by the metropolitan 74.10council or by the state demographer under Minnesota Statutes, section 4A.02, whichever 74.11is most recent as to the stated date of the count or estimate up to and including June 1 74.12of the current levy year.74.13    Subd. 2.Local government unit."Local governmental unit" means a county with a 74.14population greater than 5,000, or a statutory or home rule charter city with a population 74.15greater than 2,500.74.16    Subd. 3.Levy limit base."Levy limit base" for a local governmental unit for levy 74.17year 2013 means the sum of its certified net tax capacity levy plus the total of aids and 74.18reimbursements that the local governmental unit is certified to receive under Minnesota 74.19Statutes, sections 477A.011 to 477A.014, minus any amounts that would qualify as a 74.20special levy under Minnesota Statutes, section 275.70, subdivision 5, clauses (1) to (4) and 74.21(7), for taxes levied in 2011 or 2012, whichever is greater. The levy limit base must be 74.22increased by three percent.74.23    Subd. 4.Property tax levy limit. For taxes levied in 2013, the net tax capacity 74.24levy limit for a local governmental unit is equal to its levy limit base determined under 74.25subdivision 3 plus any additional levy authorized under Minnesota Statutes, section 74.26275.73, which is levied against net tax capacity, reduced by the total amount of aids and 74.27reimbursements that the local governmental unit is certified to receive under Minnesota 74.28Statutes, sections 477A.011 to 477A.014. The property tax levy limit for any local 74.29government cannot be less than the greater of its certified net tax capacity levies for taxes 74.30levied in 2011 or 2012. 74.31    Subd. 5. Limit on levies.Notwithstanding any other provision of law or municipal 74.32charter to the contrary which authorize ad valorem taxes in excess of the limits established 75.1by this section, the provisions of this section apply to local governmental units for all 75.2purposes other than those for which special levies under Minnesota Statutes, section 75.3275.70, subdivision 5, clauses (1) to (5) and (7), and special assessments are made.75.4    Subd. 6.Levies in excess of levy limits.If the levy made by a city or county 75.5exceeds the levy limit provided in this section, except when the excess levy is due to the 75.6rounding of the rate in accordance with Minnesota Statutes, section 275.28, the county 75.7auditor shall only extend the amount of taxes permitted under this section as provided 75.8for in Minnesota Statutes, section 275.16.75.9    Subd. 7.Calculation and notification.The commissioner of revenue shall make 75.10all necessary calculations for determining levy limits for local governmental units and 75.11notify the affected governmental units of their levy limits directly by September 1, 2013. 75.12The local governmental units shall, upon request, provide the commissioner with any 75.13information needed to make the calculations. The local governmental unit shall report 75.14by September 30, in a manner prescribed by the commissioner, the maximum amount of 75.15taxes it plans to levy for each of the purposes listed under special levies and any additional 75.16levy authorized under Minnesota Statutes, section 275.73, along with any necessary 75.17documentation. The commissioner shall review the proposed special levies and make any 75.18adjustments needed. The commissioner's decision is final. The final allowed special levy 75.19amounts and any levy limit adjustments must be certified back to the local governments by 75.20December 10. In addition, the commissioner of revenue shall notify all county auditors on 75.21or before five working days after December 20 of the sum of the levy limit plus the total of 75.22allowed special levies for each local governmental unit located within their boundaries so 75.23that they may fix the levies as required in Minnesota Statutes, section 275.16. The local 75.24governmental units shall provide the commissioner of revenue with all information that 75.25the commissioner deems necessary to make the calculations provided for in this section.75.26    Subd. 8.Information necessary to calculate levy limit base.A local governmental 75.27unit must provide the commissioner with the information required to calculate the 75.28amount under subdivision 3, by July 20, 2013. If the information is not received by the 75.29commissioner by that date, or is not deemed sufficient to make the calculation under that 75.30clause, the commissioner has the discretion to set the local governmental unit's levy limit 75.31for all purposes including those purposes for which special levies may be made, equal to 75.32the amount of the local governmental unit's certified levy for the prior year.75.33EFFECTIVE DATE.This section is effective for taxes levied in 2013, payable 75.34in 2014, only.76.1    Sec. 49. APPROPRIATION.76.2$2,000,000 in fiscal year 2014 only is appropriated from the general fund to the 76.3commissioner of revenue for a grant to the city of Moose Lake to reimburse for costs 76.4related to connection of state facilities to the sewer line.76.5EFFECTIVE DATE.This section is effective July 1, 2013.76.6ARTICLE 576.7SPECIAL TAXES76.8    Section 1. Minnesota Statutes 2012, section 270C.56, subdivision 1, is amended to read:76.9    Subdivision 1. Liability imposed. A person who, either singly or jointly with 76.10others, has the control of, supervision of, or responsibility for filing returns or reports, 76.11paying taxes, or collecting or withholding and remitting taxes and who fails to do so, or a 76.12person who is liable under any other law, is liable for the payment of taxes arising under 76.13chapters 295, 296A, 297A, 297F, and 297G, or sections 
         256.9658, 290.92, and 
         297E.02, 76.14and the applicable penalties and interest on those taxes.76.15EFFECTIVE DATE.This section is effective July 1, 2013.76.16    Sec. 2. Minnesota Statutes 2012, section 296A.09, subdivision 2, is amended to read:76.17    Subd. 2. Jet fuel and special fuel tax imposed. There is imposed an excise tax 76.18of the same rate15 cents per gallon as the aviation gasoline on all jet fuel or special 76.19fuel received, sold, stored, or withdrawn from storage in this state, for use as substitutes 76.20for aviation gasoline and not otherwise taxed as gasoline. Jet fuel is defined in section 76.21296A.01, subdivision 8
         .76.22EFFECTIVE DATE.This section is effective July 1, 2014, and applied to sales 76.23and purchases made on or after that date.76.24    Sec. 3. Minnesota Statutes 2012, section 296A.17, subdivision 3, is amended to read:76.25    Subd. 3. Refund on graduated basis. Any person who has directly or indirectly 76.26paid the excise tax on aviation gasoline or special fuel for aircraft use provided for by this 76.27chapter and the airflight property tax under section 270.72, shall, as to all such aviation 76.28gasoline and special fuel received, stored, or withdrawn from storage by the person in 76.29this state in any calendar year and not sold or otherwise disposed of to others, or intended 76.30for sale or other disposition to others, on which such tax has been so paid, be entitled to 76.31the following graduated reductions in such tax for that calendar year, to be obtained by 76.32means of the following refunds:77.1(1) on each gallon of such aviation gasoline or special fuel up to 50,000 gallons, all 77.2but five cents per gallon;77.3(2) on each gallon of such aviation gasoline or special fuel above 50,000 gallons and 77.4not more than 150,000 gallons, all but two cents per gallon;77.5(3) on each gallon of such aviation gasoline or special fuel above 150,000 gallons 77.6and not more than 200,000 gallons, all but one cent per gallon;77.7(4) on each gallon of such aviation gasoline or special fuel above 200,000, all but 77.8one-half cent per gallon.77.9EFFECTIVE DATE.This section is effective July 1, 2014, and applied to sales 77.10and purchases made on or after that date.77.11    Sec. 4. Minnesota Statutes 2012, section 297A.82, subdivision 4, is amended to read:77.12    Subd. 4. Exemptions. (a) The following transactions are exempt from the tax 77.13imposed in this chapter to the extent provided.77.14(b) The purchase or use of aircraft previously registered in Minnesota by a 77.15corporation or partnership is exempt if the transfer constitutes a transfer within the 77.16meaning of section 351 or 721 of the Internal Revenue Code.77.17(c) The sale to or purchase, storage, use, or consumption by a licensed aircraft dealer 77.18of an aircraft for which a commercial use permit has been issued pursuant to section 77.19360.654
          is exempt, if the aircraft is resold while the permit is in effect.77.20(d) Air flight equipment when sold to, or purchased, stored, used, or consumed by 77.21airline companies, as defined in section 
         270.071, subdivision 4, is exempt. For purposes 77.22of this subdivision, "air flight equipment" includes airplanes and parts necessary for the 77.23repair and maintenance of such air flight equipment, and flight simulators, but does 77.24not include airplanes with a gross weight of less than 30,000 pounds that are used on 77.25intermittent or irregularly timed flights.77.26(e) Sales of, and the storage, distribution, use, or consumption of aircraft, as defined 77.27in section 
         360.511 and approved by the Federal Aviation Administration, and which the 77.28seller delivers to a purchaser outside Minnesota or which, without intermediate use, is 77.29shipped or transported outside Minnesota by the purchaser are exempt, but only if the 77.30purchaser is not a resident of Minnesota and provided that the aircraft is not thereafter 77.31returned to a point within Minnesota, except in the course of interstate commerce or 77.32isolated and occasional use, and will be registered in another state or country upon its 77.33removal from Minnesota. This exemption applies even if the purchaser takes possession of 77.34the aircraft in Minnesota and uses the aircraft in the state exclusively for training purposes 77.35for a period not to exceed ten days prior to removing the aircraft from this state.78.1(f) The sale or purchase of the following items that relate to aircraft operated under 78.2Federal Aviation Regulations, Parts 91 and 135, and associated installation charges: 78.3equipment and parts necessary for repair and maintenance of aircraft; and equipment 78.4and parts to upgrade and improve aircraft.78.5EFFECTIVE DATE.This section is effective for sales and purchases made after 78.6June 30, 2013.78.7    Sec. 5. Minnesota Statutes 2012, section 297A.82, is amended by adding a subdivision 78.8to read:78.9    Subd. 4a.Deposit in state airports fund. Tax revenue collected from the sale or 78.10purchase of an aircraft taxable under this chapter must be deposited in the state airports 78.11fund, established in section 360.017.78.12EFFECTIVE DATE.This section is effective July 1, 2013, and applied to sales 78.13and purchases made on or after that date.78.14    Sec. 6. Minnesota Statutes 2012, section 297F.01, subdivision 3, is amended to read:78.15    Subd. 3. Cigarette. "Cigarette" means any roll for smoking made wholly or in part 78.16of tobacco, that weighs 4.5 pounds or less per thousand:78.17(1) the wrapper or cover of which is made of paper or another substance or material 78.18except tobacco; or78.19(2) wrapped in any substance containing tobacco, however labeled or named, which, 78.20because of its appearance, size, the type of tobacco used in the filler, or its packaging, 78.21pricing, marketing, or labeling, is likely to be offered to or purchased by consumers as 78.22a cigarette, as defined in clause (1), unless it is wrapped in whole tobacco leaf and does 78.23not have a cellulose acetate or other cigarette-like filter.78.24EFFECTIVE DATE.This section is effective July 1, 2013.78.25    Sec. 7. Minnesota Statutes 2012, section 297F.01, is amended by adding a subdivision 78.26to read:78.27    Subd. 10b.Moist snuff."Moist snuff" means any finely cut, ground, or powdered 78.28smokeless tobacco that is intended to be placed or dipped in the mouth.78.29EFFECTIVE DATE.This section is effective January 1, 2014.79.1    Sec. 8. Minnesota Statutes 2012, section 297F.01, is amended by adding a subdivision 79.2to read:79.3    Subd. 13a.Premium cigar."Premium cigar" means any cigar that is 79.4hand-constructed and hand-rolled, has a wrapper that is made entirely from whole tobacco 79.5leaf, has a filler and binder that is made entirely of tobacco, except for adhesives or other 79.6materials used to maintain size, texture, or flavor, and has a wholesale price of no less 79.7than $2.79.8EFFECTIVE DATE.This section is effective July 1, 2013.79.9    Sec. 9. Minnesota Statutes 2012, section 297F.01, subdivision 19, is amended to read:79.10    Subd. 19. Tobacco products.(a) "Tobacco products" means any product 79.11containing, made, or derived from tobacco that is intended for human consumption, 79.12whether chewed, smoked, absorbed, dissolved, inhaled, snorted, sniffed, or ingested by 79.13any other means, or any component, part, or accessory of a tobacco product, including, 79.14but not limited to, cigars; little cigars; cheroots; stogies; periques; granulated, plug cut, 79.15crimp cut, ready rubbed, and other smoking tobacco; snuff; snuff flour; cavendish; plug 79.16and twist tobacco; fine-cut and other chewing tobacco; shorts; refuse scraps, clippings, 79.17cuttings and sweepings of tobacco, and other kinds and forms of tobacco; but does not 79.18include cigarettes as defined in this section. Tobacco products excludes any tobacco 79.19product that has been approved by the United States Food and Drug Administration for 79.20sale as a tobacco cessation product, as a tobacco dependence product, or for other medical 79.21purposes, and is being marketed and sold solely for such an approved purpose.79.22(b) Except for the imposition of tax under section 297F.05, subdivisions 3 and 4, 79.23tobacco products includes a premium cigar, as defined in subdivision 13a. 79.24EFFECTIVE DATE.This section is effective July 1, 2013.79.25    Sec. 10. Minnesota Statutes 2012, section 297F.05, subdivision 1, is amended to read:79.26    Subdivision 1. Rates; cigarettes. A tax is imposed upon the sale of cigarettes in 79.27this state, upon having cigarettes in possession in this state with intent to sell, upon any 79.28person engaged in business as a distributor, and upon the use or storage by consumers, at 79.29the following rates:79.30(1) on cigarettes weighing not more than three pounds per thousand, 24141.5 mills 79.31on each such cigarette; and79.32(2) on cigarettes weighing more than three pounds per thousand, 48 283 mills on 79.33each such cigarette.80.1EFFECTIVE DATE.This section is effective July 1, 2013.80.2    Sec. 11. Minnesota Statutes 2012, section 297F.05, is amended by adding a subdivision 80.3to read:80.4    Subd. 1a.Annual indexing.(a) Each year the commissioner shall adjust the 80.5tax rates under subdivision 1, including any adjustment made in prior years under this 80.6subdivision, by multiplying the mill rates for the current calendar year by an adjustment 80.7factor and rounding the result to the nearest mill. The adjustment factor equals the in-lieu 80.8sales tax rate that applies to the following calendar year divided by the in-lieu sales tax 80.9rate for the current calendar year. For purposes of this subdivision, "in-lieu sales tax rate" 80.10means the tax rate established under section 297F.25, subdivision 1. For purposes of the 80.11calculations under this subdivision to be made in any year in which an increase in the 80.12federal or state excise tax on cigarettes is implemented, the commissioner shall exclude 80.13from the calculated average price for the current year an amount equal to any increase in 80.14the state or federal excise tax rate.80.15    (b) The commissioner shall publish the resulting rate by November 1 and the rate 80.16applies to sales made on or after January 1 of the following year.80.17(c) The determination of the commissioner under this subdivision is not a rule and is 80.18not subject to the Administrative Procedure Act in chapter 14.80.19EFFECTIVE DATE.This section is effective July 1, 2014.80.20    Sec. 12. Minnesota Statutes 2012, section 297F.05, subdivision 3, is amended to read:80.21    Subd. 3. Rates; tobacco products.(a) Except as provided in subdivision 3a, a tax is 80.22imposed upon all tobacco products in this state and upon any person engaged in business 80.23as a distributor, at the rate of 3595 percent of the wholesale sales price of the tobacco 80.24products. The tax is imposed at the time the distributor:80.25(1) brings, or causes to be brought, into this state from outside the state tobacco 80.26products for sale;80.27(2) makes, manufactures, or fabricates tobacco products in this state for sale in 80.28this state; or80.29(3) ships or transports tobacco products to retailers in this state, to be sold by those 80.30retailers.80.31(b) Notwithstanding paragraph (a), a minimum tax equal to the rate imposed on a 80.32pack of 20 cigarettes weighing not more than three pounds per thousand, as established 80.33under subdivision 1, is imposed on each container of moist snuff.81.1For purposes of this subdivision, a "container" means the smallest consumer-size can, 81.2package, or other container that is marketed or packaged by the manufacturer, distributor, 81.3or retailer for separate sale to a retail purchaser. When more than one container is 81.4packaged together, each container is subject to tax.81.5EFFECTIVE DATE.This section is effective July 1, 2013, except the minimum 81.6tax under paragraph (b) is effective January 1, 2014.81.7    Sec. 13. Minnesota Statutes 2012, section 297F.05, is amended by adding a subdivision 81.8to read:81.9    Subd. 3a.Rates; tobacco.(a) A tax is imposed upon all premium cigars in this state 81.10and upon any person engaged in business as a tobacco product distributor, at the lesser of:81.11(1) the rate of 95 percent of the wholesale sales price of the premium cigars; or81.12(2) $3.50 per premium cigar.81.13(b) The tax imposed under paragraph (a) is imposed at the time the tobacco products 81.14distributor:81.15(1) brings, or causes to be brought, into this state from outside the state premium 81.16cigars for sale;81.17(2) makes, manufactures, or fabricates premium cigars in this state for sale in this 81.18state; or81.19(3) ships or transports premium cigars to retailers in this state, to be sold by those 81.20retailers.81.21EFFECTIVE DATE.This section is effective July 1, 2013.81.22    Sec. 14. Minnesota Statutes 2012, section 297F.05, subdivision 4, is amended to read:81.23    Subd. 4. Use tax; tobacco products.Except as provided in subdivision 4a, a tax is 81.24imposed upon the use or storage by consumers of tobacco products in this state, and upon 81.25such consumers, at the rate of 35 95 percent of the cost to the consumer of the tobacco 81.26products or the minimum tax under subdivision 3, paragraph (b), whichever is greater.81.27EFFECTIVE DATE.This section is effective July 1, 2013.81.28    Sec. 15. Minnesota Statutes 2012, section 297F.05, is amended by adding a subdivision 81.29to read:81.30    Subd. 4a.Use tax; premium cigars.A tax is imposed upon the use or storage by 81.31consumers of all premium cigars in this state, and upon such consumers, at the lesser of:81.32(1) the rate of 95 percent of the cost to the consumer of the premium cigars; or82.1(2) $3.50 per premium cigar.82.2EFFECTIVE DATE.This section is effective July 1, 2013.82.3    Sec. 16. Minnesota Statutes 2012, section 297F.24, subdivision 1, is amended to read:82.4    Subdivision 1. Fee imposed. (a) A fee is imposed upon the sale of nonsettlement 82.5cigarettes in this state, upon having nonsettlement cigarettes in possession in this state 82.6with intent to sell, upon any person engaged in business as a distributor, and upon the use 82.7or storage by consumers of nonsettlement cigarettes. The fee equals a rate of 1.752.5 82.8cents per cigarette.82.9(b) The purpose of this fee is to:82.10(1) ensure that manufacturers of nonsettlement cigarettes pay fees to the state that 82.11are comparable to costs attributable to the use of the cigarettes;82.12(2) prevent manufacturers of nonsettlement cigarettes from undermining the state's 82.13policy of discouraging underage smoking by offering nonsettlement cigarettes at prices 82.14substantially below the cigarettes of other manufacturers; and82.15(3) fund such other purposes as the legislature determines appropriate.82.16EFFECTIVE DATE.This section is effective July 1, 2013.82.17    Sec. 17. Minnesota Statutes 2012, section 297F.25, subdivision 1, is amended to read:82.18    Subdivision 1. Imposition. (a) A tax is imposed on distributors on the sale of 82.19cigarettes by a cigarette distributor to a retailer or cigarette subjobber for resale in this 82.20state. The tax is equal to 6.5 percent ofthe combined tax rate under section 297A.62, 82.21multiplied by the weighted average retail price and must be expressed in cents per pack 82.22rounded to the nearest one-tenth of a cent. The weighted average retail price must be 82.23determined annually, with new rates published by November 1, and effective for sales 82.24on or after January 1 of the following year. The weighted average retail price must be 82.25established by surveying cigarette retailers statewide in a manner and time determined by 82.26the commissioner. The commissioner shall make an inflation adjustment in accordance 82.27with the Consumer Price Index for all urban consumers inflation indicator as published in 82.28the most recent state budget forecast. The commissioner shall use the inflation factor for 82.29the calendar year in which the new tax rate takes effect. If the survey indicates that the 82.30average retail price of cigarettes has not increased relative to the average retail price in 82.31the previous year's survey, then the commissioner shall not make an inflation adjustment. 82.32The determination of the commissioner pursuant to this subdivision is not a "rule" and is 83.1not subject to the Administrative Procedure Act contained in chapter 14. For packs of 83.2cigarettes with other than 20 cigarettes, the tax must be adjusted proportionally.83.3(b) Notwithstanding paragraph (a), and in lieu of a survey of cigarette retailers, the 83.4tax calculation of the weighted average retail price for the sales of cigarettes from August 83.51, 2011, through December 31, 2011, shall be calculated by: (1) increasing the average 83.6retail price per pack of 20 cigarettes from the most recent survey by the percentage change 83.7in a weighted average of the presumed legal prices for cigarettes during the year after 83.8completion of that survey, as reported and published by the Department of Commerce 83.9under section 
         325D.371; (2) subtracting the sales tax included in the retail price; and (3) 83.10adjusting for expected inflation. The rate must be published by May 1 and is effective for 83.11sales after July 31. If the weighted average of the presumed legal prices indicates that the 83.12average retail price of cigarettes has not increased relative to the average retail price in the 83.13most recent survey, then no inflation adjustment must be made. For packs of cigarettes 83.14with other than 20 cigarettes, the tax must be adjusted proportionally.83.15EFFECTIVE DATE.This section is effective July 1, 2013.83.16    Sec. 18. Minnesota Statutes 2012, section 297G.04, subdivision 2, is amended to read:83.17    Subd. 2. Tax credit. A qualified brewer producing fermented malt beverages 83.18is entitled to a tax credit of $4.60 per barrel on 25,000 barrels sold in any fiscal year 83.19beginning July 1, regardless of the alcohol content of the product. Qualified brewers may 83.20take the credit on the 18th day of each month, but the total credit allowed may not exceed 83.21in any fiscal year the lesser of:83.22    (1) the liability for tax; or83.23    (2) $115,000.83.24    For purposes of this subdivision, a "qualified brewer" means a brewer, whether or 83.25not located in this state, manufacturing less than 100,000 250,000 barrels of fermented 83.26malt beverages in the calendar year immediately preceding the calendar year for which 83.27the credit under this subdivision is claimed. In determining the number of barrels, all 83.28brands or labels of a brewer must be combined. All facilities for the manufacture of 83.29fermented malt beverages owned or controlled by the same person, corporation, or other 83.30entity must be treated as a single brewer.83.31EFFECTIVE DATE.This section is effective for determinations based on calendar 83.32year 2012 production and thereafter.83.33    Sec. 19. Minnesota Statutes 2012, section 325D.32, subdivision 2, is amended to read:84.1    Subd. 2. Cigarettes. "Cigarettes" means and includes any roll for smoking, made 84.2wholly or in part of tobacco, irrespective of size and shape and whether or not such 84.3tobacco is flavored, adulterated or mixed with any other ingredient, the wrapper or cover 84.4of which is made of paper or any other substance or material except whole tobacco leaf, 84.5and includes any cigarette as defined in section 297F.01, subdivision 3.84.6EFFECTIVE DATE.This section is effective July 1, 2013.84.7    Sec. 20. Minnesota Statutes 2012, section 325F.781, subdivision 1, is amended to read:84.8    Subdivision 1. Definitions. (a) For purposes of this section, the following terms 84.9have the meanings given, unless the language or context clearly provides otherwise.84.10(b) "Consumer" means an individual who purchases, receives, or possesses tobacco 84.11products for personal consumption and not for resale.84.12(c) "Delivery sale" means:84.13(1) a sale of tobacco products to a consumer in this state when:84.14(i) the purchaser submits the order for the sale by means of a telephonic or other 84.15method of voice transmission, the mail or any other delivery service, or the Internet or 84.16other online service; or84.17(ii) the tobacco products are delivered by use of the mail or other delivery service; or84.18(2) a sale of tobacco products that satisfies the criteria in clause (1), item (i), 84.19regardless of whether the seller is located inside or outside of the state.84.20A sale of tobacco products to an individual in this state must be treated as a sale to a 84.21consumer, unless the individual is licensed as a distributor or retailer of tobacco products.84.22(d) "Delivery service" means a person, including the United States Postal Service, 84.23that is engaged in the commercial delivery of letters, packages, or other containers.84.24(e) "Distributor" means a person, whether located inside or outside of this state, 84.25other than a retailer, who sells or distributes tobacco products in the state. Distributor does 84.26not include a tobacco products manufacturer, export warehouse proprietor, or importer 84.27with a valid permit under United States Code, title 26, section 5712 (1997), if the person 84.28sells or distributes tobacco products in this state only to distributors who hold valid and 84.29current licenses under the laws of a state, or to an export warehouse proprietor or another 84.30manufacturer. Distributor does not include a common or contract carrier that is transporting 84.31tobacco products under a proper bill of lading or freight bill that states the quantity, source, 84.32and destination of tobacco products, or a person who ships tobacco products through this 84.33state by common or contract carrier under a bill of lading or freight bill.84.34(f) "Retailer" means a person, whether located inside or outside this state, who sells 84.35or distributes tobacco products to a consumer in this state.85.1(g) "Tobacco products" means:85.2(1) cigarettes, as defined in section 
         297F.01, subdivision 3; and85.3(2) smokeless tobacco as defined in section 
         325F.76.; and85.4(3) premium cigars as defined in section 297F.01, subdivision 13a.85.5EFFECTIVE DATE.This section is effective July 1, 2013.85.6    Sec. 21. Minnesota Statutes 2012, section 349.166, subdivision 1, is amended to read:85.7    Subdivision 1. Exclusions. (a) Bingo, with the exception of linked bingo games, may 85.8be conducted without a license and without complying with sections 
         349.168, subdivisions 85.91 and 2; 
         349.17, subdivisions 4 and 5; 
         349.18, subdivision 1; and 
         349.19, if it is conducted:85.10(1) by an organization in connection with a county fair, the state fair, or a civic 85.11celebration and is not conducted for more than 12 consecutive days and is limited to no more 85.12than four separate applications for activities applied for and approved in a calendar year; or85.13(2) by an organization that conducts bingo on four or fewer days in a calendar year.85.14An organization that holds a license to conduct lawful gambling under this chapter 85.15may not conduct bingo under this subdivision.85.16(b) Bingo may be conducted within a nursing home or a senior citizen housing 85.17project or by a senior citizen organization if the prizes for a single bingo game do not 85.18exceed $10, total prizes awarded at a single bingo occasion do not exceed $200, no more 85.19than two bingo occasions are held by the organization or at the facility each week, only 85.20members of the organization or residents of the nursing home or housing project are 85.21allowed to play in a bingo game, no compensation is paid for any persons who conduct the 85.22bingo, and a manager is appointed to supervise the bingo. Bingo conducted under this 85.23paragraph is exempt from sections 
         349.11 to 
         349.23, and the board may not require an 85.24organization that conducts bingo under this paragraph, or the manager who supervises the 85.25bingo, to register or file a report with the board. The gross receipts from bingo conducted 85.26under the limitations of this subdivision are exempt from taxation under chapter 297A.85.27(c) Raffles may be conducted by an organization without registering with the board 85.28if the value of all raffle prizes awarded by the organization in a calendar year does not 85.29exceed $1,500 or, if the organization is a 501(c)(3) organization, if the value of all raffle 85.30prizes awarded by the organization at one event in a calendar year does not exceed $5,000.85.31(d) Except as provided in paragraph (b), the organization must maintain all required 85.32records of excluded gambling activity for 3-1/2 years.85.33EFFECTIVE DATE.This section is effective July 1, 2013.86.1    Sec. 22. Minnesota Statutes 2012, section 360.531, is amended to read:86.2360.531 TAXATION.86.3    Subdivision 1. In lieu tax. All aircraft using the air space overlying the state of 86.4Minnesota or the airports thereof, except as set forth in section 
         360.55, shall be taxed in 86.5lieu of all other taxes thereon, on the basis and at the rate for the period January 1, 1966, to 86.6June 30, 1967, and for each fiscal year as follows.86.7    Subd. 2. Rate. The tax shall be at the rate of one percent of value; provided that 86.8the minimum tax on an aircraft subject to the provisions of sections 360.511 to 360.6786.9 shall not be less than 25 percent of the tax on said aircraft computed on its base price or 86.10$50 whichever is the higher. as follows:

86.11Base PriceTax86.12Under $499,999$10086.13$500,000 to $999,999$20086.14$1,000,000 to $2,499,999$2,00086.15$2,500,000 to $4,999,999$4,00086.16$5,000,000 to $7,499,999$7,50086.17$7,500,000 to $9,999,999$10,00086.18$10,000,000 to $12,499,999$12,50086.19$12,500,000 to $14,999,999$15,00086.20$15,000,000 to $17,499,999$17,50086.21$17,500,000 to $19,999,999$20,00086.22$20,000,000 to $22,499,999$22,50086.23$22,500,000 to $24,999,999$25,00086.24$25,000,000 to $27,499,999$27,50086.25$27,500,000 to $29,999,999$30,00086.26$30,000,000 to $39,999,999$50,00086.27$40,000,000 and over$75,000

86.28    Subd. 3. First year of life. "First year of life" means the year the aircraft was 86.29manufactured.86.30    Subd. 4. Base price for taxation. For the purpose of fixing a base price for taxation 86.31from which depreciation in value at a fixed percent per annum can be counted, such, the 86.32base price is defined as follows:86.33(a) The base price for taxation of an aircraft shall be the manufacturer's list price.86.34(b) The commissioner shall have authority to fix the base value for taxation purposes 86.35of any aircraft of which no such similar or corresponding model has been manufactured, 86.36and of any rebuilt or foreign aircraft, any aircraft on which a record of the list price is not 86.37available, or any military aircraft converted for civilian use, using as a basis for such 87.1valuation the list price of aircraft with comparable performance characteristics, and taking 87.2into consideration the age and condition of the aircraft.87.3    Subd. 5. Similarity of corresponding model. Models shall be deemed similar if 87.4substantially alike and of the same make. Models shall be deemed to be corresponding 87.5models for the purpose of taxation under sections 
         360.54 to 
         360.67 if of the same make 87.6and having approximately the same weight and type of frame and the same style and 87.7size of motor.87.8    Subd. 6.Depreciation.After the first year of aircraft life the base value for taxation 87.9purposes shall be reduced as follows: ten percent the second year, and 15 percent the third 87.10and each succeeding year thereafter, but in no event shall such tax be reduced below 87.11the minimum.87.12    Subd. 7. Prorating tax. When an aircraft first becomes subject to taxation during the 87.13period for which the tax is to be paid, the tax on it shall be for the remainder of that period, 87.14prorated on a monthly basis of 1/12 of the annual tax for each calendar month counting the 87.15month during which it becomes subject to the tax as the first month of such period.87.16    Subd. 8. Tax, fiscal year. Every aircraft subject to the provisions of sections 87.17360.511
          to 
         360.67 which has at any time since April 19, 1945, used the air space overlying 87.18the state of Minnesota or the airports thereof shall be taxed for the period from January 1, 87.191966, through June 30, 1967, and for each fiscal year thereafter in which it is so used. Any 87.20aircraft which does not use the air space overlying the state of Minnesota or the airports 87.21thereof at any time during the period of January 1, 1966, to and including June 30, 1967, 87.22or at any time during any fiscal year thereafter shall not be subject to the tax provided by 87.23sections 
         360.511 to 
         360.67 for such period. Rebuilt aircraft shall be subject to the tax 87.24provided by sections 
         360.511 to 
         360.67 for that portion of the aforesaid periods remaining 87.25after the aircraft has been rebuilt, prorated on a monthly basis.87.26    Subd. 9. Assessed as personal property in certain cases. Aircraft subject to 87.27taxation under the provisions of sections 
         360.54 to 
         360.67 shall not be assessed as personal 87.28property and shall be subject to no tax except as provided for by these sections. Aircraft 87.29not subject to taxation as provided in these sections, but subject to taxation as personal 87.30property within the state of Minnesota shall be assessed and valued at 33-1/3 percent of 87.31the market value thereof and taxed at the rate and in the manner provided by law for the 87.32taxation of ordinary personal property. If the person against whom any tax has been levied 87.33on the ad valorem basis because of any aircraft shall, during the calendar year for which 87.34such ad valorem tax is levied, be also taxed under provisions of these sections, then and in 87.35that event, upon proper showing, the commissioner of revenue shall grant to the person 87.36against whom said ad valorem tax was levied, such reduction or abatement of net tax 88.1capacity or taxes as was occasioned by the so-called ad valorem tax imposed. If the ad 88.2valorem tax upon any aircraft has been assessed against a dealer in new and used aircraft, 88.3and the tax imposed by these sections for the required period is thereafter paid by the 88.4owner, then and in that event, upon proper showing, the commissioner of revenue, upon 88.5the application of said dealer, shall grant to such dealer against whom said ad valorem tax 88.6was levied such reduction or abatement of net tax capacity or taxes as was occasioned 88.7by the so-called ad valorem tax imposed.88.8EFFECTIVE DATE.This section is effective July 1, 2014, and applies to aircraft 88.9tax due on or after that date.88.10    Sec. 23. Minnesota Statutes 2012, section 360.66, is amended to read:88.11360.66 STATE AIRPORTS FUND.88.12    Subdivision 1. Tax credited to fund. The proceeds of the tax imposed on aircraft 88.13under sections 
         360.54360.531 to 
         360.67 and all fees and penalties provided for therein 88.14shall be collected by the commissioner and paid into the state treasury and credited to the 88.15state airports fund created by other statutes of this state.88.16    Subd. 2. Reimbursement for expenses. There shall be transferred by the 88.17commissioner of management and budget each year from the state airports fund to the 88.18general fund in the state treasury the amount expended from the latter fund for expenses of 88.19administering the provisions of sections 
         360.54360.531 to 
         360.67.88.20EFFECTIVE DATE.This section is effective July 1, 2014, and applies to aircraft 88.21tax due on or after that date.88.22    Sec. 24. REPORT.88.23On or before June 30, 2016, and every four years thereafter, the commissioner of 88.24transportation, in consultation with the commissioner of revenue, shall prepare and submit 88.25to the chairs and ranking minority members of the senate and house of representatives 88.26committees with jurisdiction over transportation policy and budget, a report that identifies 88.27the amount and sources of annual revenues attributable to each type of aviation tax, along 88.28with annual expenditures from the state airports fund, and any other transfers out of the 88.29fund, during the previous four years. The report must include draft legislation for any 88.30recommended statutory changes to ensure the future adequacy of the state airports fund.88.31EFFECTIVE DATE.This section is effective July 1, 2014, and applies to aircraft 88.32tax due on or after that date.89.1    Sec. 25. FLOOR STOCKS TAX.89.2    Subdivision 1.Cigarettes.(a) A floor stocks tax is imposed on every person 89.3engaged in the business in this state as a distributor, retailer, subjobber, vendor, 89.4manufacturer, or manufacturer's representative of cigarettes, on the stamped cigarettes and 89.5unaffixed stamps in the person's possession or under the person's control at 12:01 a.m. 89.6on July 1, 2013. The tax is imposed at the rate of 80 mills on each cigarette plus the 89.7additional cigarette sales tax determined by an adjustment to the weighted average retail 89.8price which reflects the price including the increased tax.89.9(b) Each distributor, on or before July 11, 2013, shall file a return with the 89.10commissioner of revenue, in the form the commissioner prescribes, showing the stamped 89.11cigarettes and unaffixed stamps on hand at 12:01 a.m. on July 1, 2013, and the amount 89.12of tax due on the cigarettes and unaffixed stamps. Each retailer, subjobber, vendor, 89.13manufacturer, or manufacturer's representative, on or before July 11, 2013, shall file 89.14a return with the commissioner, in the form the commissioner prescribes, showing the 89.15cigarettes on hand at 12:01 a.m. on July 1, 2013, and the amount of tax due on the 89.16cigarettes. The tax imposed by this section is due and payable on or before September 4, 89.172013, and after that date bears interest at the rate of one percent per month.89.18    Subd. 2.Audit and enforcement.The tax imposed by this section is subject to 89.19the audit, assessment, interest, appeal, refund, penalty, enforcement, administrative, and 89.20collection provisions of Minnesota Statutes, chapters 270C and 297F. The commissioner 89.21of revenue may require a distributor to receive and maintain copies of floor stocks fee 89.22returns filed by all persons requesting a credit for returned cigarettes.89.23    Subd. 3.Deposit of proceeds.(a) The commissioner of revenue shall deposit 89.24$26,500,000 of the revenues from the tax under this section in the state treasury and credit 89.25them to the general reserve account established under Minnesota Statutes 297E.021, 89.26subdivision 4.89.27(b) The commissioner of revenue shall deposit any revenue remaining after the 89.28transfer under paragraph (a) to the general fund.89.29EFFECTIVE DATE.This section is effective July 1, 2013.89.30    Sec. 26. INTERIM SALES TAX RATE.89.31Notwithstanding the provisions of Minnesota Statutes, section 297F.25, the 89.32commissioner shall adjust the weighted average retail price in section 297F.25, subdivision 89.331, on July 1, 2013, to reflect the price changes under this act. This weighted average 90.1shall be used to compute cigarette sales tax under Minnesota Statutes, section 297F.25, 90.2subdivision 1, until December 31, 2013, when the commissioner shall resume annual 90.3adjustments to the weighted average sales price. The commissioner's determination of 90.4the adjustment that takes effect on January 1, 2014, must be limited to the change in the 90.5weighted average retail price that occurs during calendar year 2013 but after July 15, 2013.90.6EFFECTIVE DATE.This section is effective July 1, 2013.90.7    Sec. 27. TOBACCO TAX COLLECTION REPORT.90.8    Subdivision 1.Report to legislature.(a) The commissioner of revenue shall report 90.9to the 2014 legislature on the tobacco tax collection system, including recommendations 90.10to improve compliance under the excise tax for both cigarettes and other tobacco products. 90.11The purpose of the report is to provide information and guidance to the legislature on 90.12improvements to the tobacco tax collection system to:90.13(1) provide a unified system of collecting both the cigarette and other tobacco 90.14taxes, regardless of category, size, or shape, that ensures the highest reasonable rates of 90.15tax collection;90.16(2) discourage tax evasion; and90.17(3) help to prevent illegal sale of tobacco products, which may make these products 90.18more accessible to youth.90.19(b) In the report, the commissioner shall:90.20(1) provide a detailed review of the present excise tax collection and compliance 90.21system as it applies to both cigarettes and other tobacco products. This must include 90.22an assessment of the levels of compliance for each category of products and the effect 90.23of the stamping requirement on compliance for each category of products and the effect 90.24of the stamping requirement on compliance rates for cigarettes relative to other tobacco 90.25products. It also must identify any weaknesses in the system;90.26(2) survey the methods of collection and enforcement used by other states or nations, 90.27including identifying and discussing emerging best practices that ensure tracking of both 90.28cigarettes and other tobacco products and result in the highest rates of tax collection and 90.29compliance. These best practices must consider high-technology alternatives, such as use 90.30of bar codes, radio-frequency identification tags, or similar mechanisms for tracking 90.31compliance;90.32(3) evaluate the adequacy and effectiveness of the existing penalties and other 90.33sanctions for noncompliance;91.1(4) evaluate the adequacy of the resources allocated by the state to enforce the 91.2tobacco tax and prevention laws; and91.3(5) make recommendations on implementation of a comprehensive tobacco tax 91.4collection system for Minnesota that can be implemented by January 1, 2014, including:91.5(i) recommendations on the specific steps needed to institute and implement the new 91.6system, including estimates of the state's costs of doing so and any additional personnel 91.7requirements;91.8(ii) recommendations on methods to recover the cost of implementing the system 91.9from the industry;91.10(iii) evaluation of the extent to which the proposed system is sufficiently flexible 91.11and adaptable to adjust to modifications in the construction, packaging, formatting, and 91.12marketing of tobacco products by the industry; and91.13(iv) recommendations to modify existing penalties or to impose new penalties or 91.14other sanctions to ensure compliance with the system.91.15    Subd. 2.Due date.The report required by subdivision 1 is due February 15, 2014.91.16    Subd. 3.Procedure.The report required under this section must be made in the 91.17manner provided under Minnesota Statutes, section 3.195. In addition, copies must be 91.18provided to the chairs and ranking minority members of the legislative committees and 91.19divisions with jurisdiction over taxation.91.20    Subd. 4.Appropriation.(a) $100,000 is appropriated from the general fund to the 91.21commissioner of revenue for fiscal year 2014 for the cost of preparing the report under 91.22subdivision 1.91.23(b) The appropriation under this subdivision is a onetime appropriation and is not 91.24included in the base budget.91.25EFFECTIVE DATE.This section is effective the day following final enactment.91.26    Sec. 28.  REPEALER.91.27Minnesota Statutes 2012, sections 16A.725; and 256.9658, are repealed.91.28EFFECTIVE DATE.This section is effective July 1, 2013.91.29ARTICLE 691.30INDIVIDUAL INCOME AND CORPORATE FRANCHISE TAXES91.31    Section 1. Minnesota Statutes 2012, section 116J.8737, subdivision 1, is amended to 91.32read:92.1    Subdivision 1. Definitions. (a) For the purposes of this section, the following terms 92.2have the meanings given.92.3(b) "Qualified small business" means a business that has been certified by the 92.4commissioner under subdivision 2.92.5(c) "Qualified investor" means an investor who has been certified by the 92.6commissioner under subdivision 3.92.7(d) "Qualified fund" means a pooled angel investment network fund that has been 92.8certified by the commissioner under subdivision 4.92.9(e) "Qualified investment" means a cash investment in a qualified small business 92.10of a minimum of:92.11(1) $10,000 in a calendar year by a qualified investor; or92.12(2) $30,000 in a calendar year by a qualified fund.92.13A qualified investment must be made in exchange for common stock, a partnership 92.14or membership interest, preferred stock, debt with mandatory conversion to equity, or an 92.15equivalent ownership interest as determined by the commissioner.92.16(f) "Family" means a family member within the meaning of the Internal Revenue 92.17Code, section 267(c)(4).92.18(g) "Pass-through entity" means a corporation that for the applicable taxable year is 92.19treated as an S corporation or a general partnership, limited partnership, limited liability 92.20partnership, trust, or limited liability company and which for the applicable taxable year is 92.21not taxed as a corporation under chapter 290.92.22(h) "Intern" means a student of an accredited institution of higher education, or a 92.23former student who has graduated in the past six months from an accredited institution 92.24of higher education, who is employed by a qualified small business in a nonpermanent 92.25position for a duration of nine months or less that provides training and experience in the 92.26primary business activity of the business.92.27(i) "Liquidation event" means a conversion of qualified investment for cash, cash 92.28and other consideration, or any other form of equity or debt interest.92.29EFFECTIVE DATE.This section is effective for qualified small businesses 92.30certified after June 30, 2013.92.31    Sec. 2. Minnesota Statutes 2012, section 116J.8737, subdivision 2, is amended to read:92.32    Subd. 2. Certification of qualified small businesses. (a) Businesses may apply 92.33to the commissioner for certification as a qualified small business for a calendar year. 92.34The application must be in the form and be made under the procedures specified by the 92.35commissioner, accompanied by an application fee of $150. Application fees are deposited 93.1in the small business investment tax credit administration account in the special revenue 93.2fund. The application for certification for 2010 must be made available on the department's 93.3Web site by August 1, 2010. Applications for subsequent years' certification must be made 93.4available on the department's Web site by November 1 of the preceding year.93.5(b) Within 30 days of receiving an application for certification under this subdivision, 93.6the commissioner must either certify the business as satisfying the conditions required of a 93.7qualified small business, request additional information from the business, or reject the 93.8application for certification. If the commissioner requests additional information from the 93.9business, the commissioner must either certify the business or reject the application within 93.1030 days of receiving the additional information. If the commissioner neither certifies the 93.11business nor rejects the application within 30 days of receiving the original application or 93.12within 30 days of receiving the additional information requested, whichever is later, then 93.13the application is deemed rejected, and the commissioner must refund the $150 application 93.14fee. A business that applies for certification and is rejected may reapply.93.15(c) To receive certification, a business must satisfy all of the following conditions:93.16(1) the business has its headquarters in Minnesota;93.17(2) at least 51 percent of the business's employees are employed in Minnesota, and 93.1851 percent of the business's total payroll is paid or incurred in the state;93.19(3) the business is engaged in, or is committed to engage in, innovation in Minnesota 93.20in one of the following as its primary business activity:93.21(i) using proprietary technology to add value to a product, process, or service in a 93.22qualified high-technology field;93.23(ii) researching or developing a proprietary product, process, or service in a qualified 93.24high-technology field; or93.25(iii) researching, developing, or producing a new proprietary technology for use in 93.26the fields of agriculture, tourism, forestry, mining, manufacturing, or transportation;93.27(4) other than the activities specifically listed in clause (3), the business is not 93.28engaged in real estate development, insurance, banking, lending, lobbying, political 93.29consulting, information technology consulting, wholesale or retail trade, leisure, 93.30hospitality, transportation, construction, ethanol production from corn, or professional 93.31services provided by attorneys, accountants, business consultants, physicians, or health 93.32care consultants;93.33(5) the business has fewer than 25 employees;93.34(6) the business must pay its employees annual wages of at least 175 percent of the 93.35federal poverty guideline for the year for a family of four and must pay its interns annual 93.36wages of at least 175 percent of the federal minimum wage used for federally covered 94.1employers, except that this requirement must be reduced proportionately for employees 94.2and interns who work less than full-time, and does not apply to an executive, officer, or 94.3member of the board of the business, or to any employee who owns, controls, or holds 94.4power to vote more than 20 percent of the outstanding securities of the business;94.5(7) the business has (i) not been in operation for more than ten years, or (ii) the 94.6business has not been in operation for more than 20 years if the business is engaged 94.7in the research, development, or production of medical devices or pharmaceuticals for 94.8which United States Food and Drug Administration approval is required for use in the 94.9treatment or diagnosis of a disease or condition;94.10(8) the business has not previously received private equity investments of more 94.11than $4,000,000; and94.12    (9) the business is not an entity disqualified under section 
         80A.50, paragraph (b), 94.13clause (3).; and94.14(10) the business has not issued securities that are traded on a public exchange.94.15(d) In applying the limit under paragraph (c), clause (5), the employees in all members 94.16of the unitary business, as defined in section 
         290.17, subdivision 4, must be included.94.17(e) In order for a qualified investment in a business to be eligible for tax credits,:94.18(1) the business must have applied for and received certification for the calendar 94.19year in which the investment was made prior to the date on which the qualified investment 94.20was made.;94.21(2) the business must not have issued securities that are traded on a public exchange;94.22(3) the business must not issue securities that are traded on a public exchange within 94.23180 days after the date on which the qualified investment was made; and94.24(4) the business must not have a liquidation event within 180 days after the date on 94.25which the qualified investment was made.94.26(f) The commissioner must maintain a list of businesses certified under this 94.27subdivision for the calendar year and make the list accessible to the public on the 94.28department's Web site.94.29(g) For purposes of this subdivision, the following terms have the meanings given:94.30(1) "qualified high-technology field" includes aerospace, agricultural processing, 94.31renewable energy, energy efficiency and conservation, environmental engineering, food 94.32technology, cellulosic ethanol, information technology, materials science technology, 94.33nanotechnology, telecommunications, biotechnology, medical device products, 94.34pharmaceuticals, diagnostics, biologicals, chemistry, veterinary science, and similar 94.35fields; and95.1(2) "proprietary technology" means the technical innovations that are unique and 95.2legally owned or licensed by a business and includes, without limitation, those innovations 95.3that are patented, patent pending, a subject of trade secrets, or copyrighted.95.4EFFECTIVE DATE.This section is effective for qualified small businesses 95.5certified after June 30, 2013, except the amendments to paragraph (c), clause (7), are 95.6effective the day following final enactment.95.7    Sec. 3. Minnesota Statutes 2012, section 116J.8737, subdivision 8, is amended to read:95.8    Subd. 8. Data privacy. (a) Data contained in an application submitted to the 95.9commissioner under subdivision 2, 3, or 4 are nonpublic data, or private data on 95.10individuals, as defined in section 
         13.02, subdivision 9 or 12, except that the following 95.11data items are public:95.12(1) the name, mailing address, telephone number, e-mail address, contact person's 95.13name, and industry type of a qualified small business upon approval of the application 95.14and certification by the commissioner under subdivision 2;95.15(2) the name of a qualified investor upon approval of the application and certification 95.16by the commissioner under subdivision 3;95.17(3) the name of a qualified fund upon approval of the application and certification 95.18by the commissioner under subdivision 4;95.19(4) for credit certificates issued under subdivision 5, the amount of the credit 95.20certificate issued, amount of the qualifying investment, the name of the qualifying investor 95.21or qualifying fund that received the certificate, and the name of the qualifying small 95.22business in which the qualifying investment was made;95.23(5) for credits revoked under subdivision 7, paragraph (a), the amount revoked and 95.24the name of the qualified investor or qualified fund; and95.25(6) for credits revoked under subdivision 7, paragraphs (b) and (c), the amount 95.26revoked and the name of the qualified small business.95.27(b) The following data, including data classified as nonpublic or private, must be 95.28provided to the consultant for use in conducting the program evaluation under subdivision 95.2910:95.30(1) the commissioner of employment and economic development shall provide data 95.31contained in an application for certification received from a qualified small business, 95.32qualified investor, or qualified fund, and any annual reporting information received on a 95.33qualified small business, qualified investor, or qualified fund; and95.34(2) the commissioner of revenue shall provide data contained in any applicable tax 95.35returns of a qualified small business, qualified investor, or qualified fund.96.1EFFECTIVE DATE.This section is effective the day following final enactment.96.2    Sec. 4. [136A.129] GREATER MINNESOTA INTERNSHIP PROGRAM.96.3    Subdivision 1.Definitions.(a) For the purposes of this section, the terms defined in 96.4this subdivision have the meanings given to them.96.5(b) "Eligible employer" means a taxpayer under section 290.01 with employees 96.6located in greater Minnesota.96.7(c) "Eligible institution" means a Minnesota public postsecondary institution or a 96.8Minnesota private, nonprofit, baccalaureate degree-granting college or university.96.9(d) "Eligible student" means a student enrolled in an eligible institution who has 96.10completed one-half of the credits necessary for the respective degree or certification.96.11(e) "Greater Minnesota" means the area of the state outside of the counties of Anoka, 96.12Carver, Chisago, Dakota, Hennepin, Isanti, Ramsey, Scott, Sherburne, Washington, and 96.13Wright.96.14    Subd. 2.Program established.The Office of Higher Education shall administer 96.15a greater Minnesota internship program through eligible institutions to provide credit at 96.16the eligible institution for internships and tax credits for eligible employers who hire 96.17interns for employment in greater Minnesota.96.18    Subd. 3.Program components.(a) An intern must be an eligible student who has 96.19been admitted to a major program that is related to the intern experience as determined 96.20by the eligible institution.96.21(b) To participate in the program, an eligible institution must:96.22(1) enter into written agreements with eligible employers to provide internships that 96.23are at least 12 weeks long and located in greater Minnesota;96.24(2) determine that the work experience of the internship is related to the eligible 96.25student's course of study; and96.26(3) provide academic credit for the successful completion of the internship or ensure 96.27that it fulfills requirements necessary to complete a vocational technical education program.96.28(c) To participate in the program, an eligible employer must enter into a written 96.29agreement with an eligible institution specifying that the intern:96.30(1) would not have been hired without the tax credit described in subdivision 4;96.31(2) did not work for the employer in the same or a similar job prior to entering 96.32the agreement;96.33(3) does not replace an existing employee;96.34(4) has not previously participated in the program;96.35(5) will be employed at a location in greater Minnesota;97.1(6) will be paid at least minimum wage for a minimum of 16 hours per week for a 97.2period of at least 12 weeks; and97.3(7) will be supervised and evaluated by the employer.97.4(d) The written agreement between the eligible institution and the eligible employer 97.5must certify a credit amount to the employer, not to exceed $2,000 per intern. The total 97.6dollar amount of credits that an eligible institution certifies to eligible employers in a 97.7calendar year may not exceed the amount of its allocation under subdivision 4.97.8(e) Participating eligible institutions and eligible employers must report annually to 97.9the office. The report must include at least the following:97.10(1) the number of interns hired;97.11(2) the number of hours and weeks worked by interns; and97.12(3) the compensation paid to interns.97.13(f) An internship required to complete an academic program does not qualify for the 97.14greater Minnesota internship program under this section.97.15    Subd. 4.Tax credit allowed.An employer is entitled to a tax credit as provided in 97.16section 290.06, subdivision 36. The total amount of credits allocated in a calendar year 97.17must not exceed $2,000,000. The office shall determine relevant criteria to allocate the 97.18tax credits including the geographic distribution of credits to work locations outside the 97.19metropolitan area, and shall allocate credits to eligible institutions that meet the criteria on 97.20a first come, first served basis. Any credits allocated to an institution but not used may be 97.21reallocated to eligible institutions. The office shall allocate a portion of the administrative 97.22fee under section 290.06, subdivision 36, to participating eligible institutions for their 97.23administrative costs.97.24    Subd. 5.Reports to the legislature.(a) By February 1, 2015, the office and the 97.25Department of Revenue shall report to the legislature on the greater Minnesota internship 97.26program. The report must include at least the following:97.27(1) the number and dollar amount of credits allowed;97.28(2) the number of interns employed under the program; and97.29(3) the cost of administering the program.97.30(b) By February 1, 2016, the office and the Department of Revenue shall report to the 97.31legislature with an analysis of the effectiveness of the program in stimulating businesses 97.32to hire interns and in assisting participating interns in finding permanent career positions. 97.33This report must include the number of students who participated in the program who 97.34were subsequently employed full-time by the employer.97.35EFFECTIVE DATE.This section is effective for taxable years beginning after 97.36December 31, 2013.98.1    Sec. 5. Minnesota Statutes 2012, section 289A.08, subdivision 3, is amended to read:98.2    Subd. 3. Corporations. (a) A corporation that is subject to the state's jurisdiction to 98.3tax under section 
         290.014, subdivision 5, must file a return, except that a foreign operating 98.4corporation as defined in section 290.01, subdivision 6b, is not required to file a return.98.5(b) Members of a unitary business that are required to file a combined report on one 98.6return must designate a member of the unitary business to be responsible for tax matters, 98.7including the filing of returns, the payment of taxes, additions to tax, penalties, interest, 98.8or any other payment, and for the receipt of refunds of taxes or interest paid in excess of 98.9taxes lawfully due. The designated member must be a member of the unitary business that 98.10is filing the single combined report and either:98.11(1) a corporation that is subject to the taxes imposed by chapter 290; or98.12(2) a corporation that is not subject to the taxes imposed by chapter 290:98.13(i) Such corporation consents by filing the return as a designated member under this 98.14clause to remit taxes, penalties, interest, or additions to tax due from the members of the 98.15unitary business subject to tax, and receive refunds or other payments on behalf of other 98.16members of the unitary business. The member designated under this clause is a "taxpayer" 98.17for the purposes of this chapter and chapter 270C, and is liable for any liability imposed 98.18on the unitary business under this chapter and chapter 290.98.19(ii) If the state does not otherwise have the jurisdiction to tax the member designated 98.20under this clause, consenting to be the designated member does not create the jurisdiction 98.21to impose tax on the designated member, other than as described in item (i).98.22(iii) The member designated under this clause must apply for a business tax account 98.23identification number.98.24(c) The commissioner shall adopt rules for the filing of one return on behalf of the 98.25members of an affiliated group of corporations that are required to file a combined report. 98.26All members of an affiliated group that are required to file a combined report must file one 98.27return on behalf of the members of the group under rules adopted by the commissioner.98.28(d) If a corporation claims on a return that it has paid tax in excess of the amount of 98.29taxes lawfully due, that corporation must include on that return information necessary for 98.30payment of the tax in excess of the amount lawfully due by electronic means.98.31EFFECTIVE DATE.This section is effective for taxable years beginning after 98.32December 31, 2012.98.33    Sec. 6. Minnesota Statutes 2012, section 290.01, subdivision 19, as amended by Laws 98.342013, chapter 3, section 3, is amended to read:99.1    Subd. 19. Net income. The term "net income" means the federal taxable income, 99.2as defined in section 63 of the Internal Revenue Code of 1986, as amended through the 99.3date named in this subdivision, incorporating the federal effective dates of changes to the 99.4Internal Revenue Code and any elections made by the taxpayer in accordance with the 99.5Internal Revenue Code in determining federal taxable income for federal income tax 99.6purposes, and with the modifications provided in subdivisions 19a to 19f.99.7    In the case of a regulated investment company or a fund thereof, as defined in section 99.8851(a) or 851(g) of the Internal Revenue Code, federal taxable income means investment 99.9company taxable income as defined in section 852(b)(2) of the Internal Revenue Code, 99.10except that:99.11    (1) the exclusion of net capital gain provided in section 852(b)(2)(A) of the Internal 99.12Revenue Code does not apply;99.13    (2) the deduction for dividends paid under section 852(b)(2)(D) of the Internal 99.14Revenue Code must be applied by allowing a deduction for capital gain dividends and 99.15exempt-interest dividends as defined in sections 852(b)(3)(C) and 852(b)(5) of the Internal 99.16Revenue Code; and99.17    (3) the deduction for dividends paid must also be applied in the amount of any 99.18undistributed capital gains which the regulated investment company elects to have treated 99.19as provided in section 852(b)(3)(D) of the Internal Revenue Code.99.20    The net income of a real estate investment trust as defined and limited by section 99.21856(a), (b), and (c) of the Internal Revenue Code means the real estate investment trust 99.22taxable income as defined in section 857(b)(2) of the Internal Revenue Code.99.23    The net income of a designated settlement fund as defined in section 468B(d) of 99.24the Internal Revenue Code means the gross income as defined in section 468B(b) of the 99.25Internal Revenue Code.99.26    The Internal Revenue Code of 1986, as amended through April 14, 2011, shall be in 99.27effect for taxable years beginning after December 31, 1996, and before January 1, 2012, 99.28and for taxable years beginning after December 31, 2012. The Internal Revenue Code of 99.291986, as amended through January 3, 2013, is in effect for taxable years beginning after 99.30December 31, 2011, and before January 1, 2013.99.31The provisions of sections 315 and 331 of the American Taxpayer Relief Act of 99.322012, Public Law 112-240, extension of increased expensing limitations and treatment 99.33of certain real property as section 179 property and extension and modification of bonus 99.34depreciation, are effective at the same time they become effective for federal purposes.100.1    Except as otherwise provided, references to the Internal Revenue Code in 100.2subdivisions 19 to 19f mean the code in effect for purposes of determining net income for 100.3the applicable year.100.4EFFECTIVE DATE.This section is effective for taxable years beginning after 100.5December 31, 2012.100.6    Sec. 7. Minnesota Statutes 2012, section 290.01, subdivision 19b, is amended to read:100.7    Subd. 19b. Subtractions from federal taxable income. For individuals, estates, 100.8and trusts, there shall be subtracted from federal taxable income:100.9    (1) net interest income on obligations of any authority, commission, or 100.10instrumentality of the United States to the extent includable in taxable income for federal 100.11income tax purposes but exempt from state income tax under the laws of the United States;100.12    (2) if included in federal taxable income, the amount of any overpayment of income 100.13tax to Minnesota or to any other state, for any previous taxable year, whether the amount 100.14is received as a refund or as a credit to another taxable year's income tax liability;100.15    (3) the amount paid to others, less the amount used to claim the credit allowed under 100.16section 
         290.0674, not to exceed $1,625 for each qualifying child in grades kindergarten 100.17to 6 and $2,500 for each qualifying child in grades 7 to 12, for tuition, textbooks, and 100.18transportation of each qualifying child in attending an elementary or secondary school 100.19situated in Minnesota, North Dakota, South Dakota, Iowa, or Wisconsin, wherein a 100.20resident of this state may legally fulfill the state's compulsory attendance laws, which 100.21is not operated for profit, and which adheres to the provisions of the Civil Rights Act 100.22of 1964 and chapter 363A. For the purposes of this clause, "tuition" includes fees or 100.23tuition as defined in section 
         290.0674, subdivision 1, clause (1). As used in this clause, 100.24"textbooks" includes books and other instructional materials and equipment purchased 100.25or leased for use in elementary and secondary schools in teaching only those subjects 100.26legally and commonly taught in public elementary and secondary schools in this state. 100.27Equipment expenses qualifying for deduction includes expenses as defined and limited in 100.28section 
         290.0674, subdivision 1, clause (3). "Textbooks" does not include instructional 100.29books and materials used in the teaching of religious tenets, doctrines, or worship, the 100.30purpose of which is to instill such tenets, doctrines, or worship, nor does it include books 100.31or materials for, or transportation to, extracurricular activities including sporting events, 100.32musical or dramatic events, speech activities, driver's education, or similar programs. No 100.33deduction is permitted for any expense the taxpayer incurred in using the taxpayer's or 100.34the qualifying child's vehicle to provide such transportation for a qualifying child. For 101.1purposes of the subtraction provided by this clause, "qualifying child" has the meaning 101.2given in section 32(c)(3) of the Internal Revenue Code;101.3    (4) income as provided under section 
         290.0802;101.4    (5) to the extent included in federal adjusted gross income, income realized on 101.5disposition of property exempt from tax under section 
         290.491;101.6    (6) to the extent not deducted or not deductible pursuant to section 408(d)(8)(E) 101.7of the Internal Revenue Code in determining federal taxable income by an individual 101.8who does not itemize deductions for federal income tax purposes for the taxable year, an 101.9amount equal to 50 percent of the excess of charitable contributions over $500 allowable 101.10as a deduction for the taxable year under section 170(a) of the Internal Revenue Code, 101.11under the provisions of Public Law 109-1 and Public Law 111-126;101.12    (7) for individuals who are allowed a federal foreign tax credit for taxes that do not 101.13qualify for a credit under section 
         290.06, subdivision 22, an amount equal to the carryover 101.14of subnational foreign taxes for the taxable year, but not to exceed the total subnational 101.15foreign taxes reported in claiming the foreign tax credit. For purposes of this clause, 101.16"federal foreign tax credit" means the credit allowed under section 27 of the Internal 101.17Revenue Code, and "carryover of subnational foreign taxes" equals the carryover allowed 101.18under section 904(c) of the Internal Revenue Code minus national level foreign taxes to 101.19the extent they exceed the federal foreign tax credit;101.20    (8) in each of the five tax years immediately following the tax year in which an 101.21addition is required under subdivision 19a, clause (7), or 19c, clause (15) (12), in the case 101.22of a shareholder of a corporation that is an S corporation, an amount equal to one-fifth of the 101.23delayed depreciation. For purposes of this clause, "delayed depreciation" means the amount 101.24of the addition made by the taxpayer under subdivision 19a, clause (7), or subdivision 19c, 101.25clause (15) (12), in the case of a shareholder of an S corporation, minus the positive value 101.26of any net operating loss under section 172 of the Internal Revenue Code generated for the 101.27tax year of the addition. The resulting delayed depreciation cannot be less than zero;101.28    (9) job opportunity building zone income as provided under section 
         469.316;101.29    (10) to the extent included in federal taxable income, the amount of compensation 101.30paid to members of the Minnesota National Guard or other reserve components of the 101.31United States military for active service, excluding compensation for services performed 101.32under the Active Guard Reserve (AGR) program. For purposes of this clause, "active 101.33service" means (i) state active service as defined in section 
         190.05, subdivision 5a, clause 101.34(1); or (ii) federally funded state active service as defined in section 
         190.05, subdivision 101.355b
         , but "active service" excludes service performed in accordance with section 
         190.08, 101.36subdivision 3
         ;102.1    (11) to the extent included in federal taxable income, the amount of compensation 102.2paid to Minnesota residents who are members of the armed forces of the United States 102.3or United Nations for active duty performed under United States Code, title 10; or the 102.4authority of the United Nations;102.5    (12) an amount, not to exceed $10,000, equal to qualified expenses related to a 102.6qualified donor's donation, while living, of one or more of the qualified donor's organs 102.7to another person for human organ transplantation. For purposes of this clause, "organ" 102.8means all or part of an individual's liver, pancreas, kidney, intestine, lung, or bone marrow; 102.9"human organ transplantation" means the medical procedure by which transfer of a human 102.10organ is made from the body of one person to the body of another person; "qualified 102.11expenses" means unreimbursed expenses for both the individual and the qualified donor 102.12for (i) travel, (ii) lodging, and (iii) lost wages net of sick pay, except that such expenses 102.13may be subtracted under this clause only once; and "qualified donor" means the individual 102.14or the individual's dependent, as defined in section 152 of the Internal Revenue Code. An 102.15individual may claim the subtraction in this clause for each instance of organ donation for 102.16transplantation during the taxable year in which the qualified expenses occur;102.17    (13) in each of the five tax years immediately following the tax year in which an 102.18addition is required under subdivision 19a, clause (8), or 19c, clause (16) (13), in the case 102.19of a shareholder of a corporation that is an S corporation, an amount equal to one-fifth of 102.20the addition made by the taxpayer under subdivision 19a, clause (8), or 19c, clause (16)102.21 (13), in the case of a shareholder of a corporation that is an S corporation, minus the 102.22positive value of any net operating loss under section 172 of the Internal Revenue Code 102.23generated for the tax year of the addition. If the net operating loss exceeds the addition for 102.24the tax year, a subtraction is not allowed under this clause;102.25    (14) to the extent included in the federal taxable income of a nonresident of 102.26Minnesota, compensation paid to a service member as defined in United States Code, title 102.2710, section 101(a)(5), for military service as defined in the Servicemembers Civil Relief 102.28Act, Public Law 108-189, section 101(2);102.29    (15) to the extent included in federal taxable income, the amount of national service 102.30educational awards received from the National Service Trust under United States Code, 102.31title 42, sections 12601 to 12604, for service in an approved Americorps National Service 102.32program;102.33(16) to the extent included in federal taxable income, discharge of indebtedness 102.34income resulting from reacquisition of business indebtedness included in federal taxable 102.35income under section 108(i) of the Internal Revenue Code. This subtraction applies only 103.1to the extent that the income was included in net income in a prior year as a result of the 103.2addition under section 
         290.01, subdivision 19a, clause (16); and103.3(17) the amount of the net operating loss allowed under section 
         290.095, subdivision 103.411
         , paragraph (c); and103.5(18) the amount of expenses not allowed for federal income tax purposes due 103.6to claiming the railroad track maintenance credit under section 45G(a) of the Internal 103.7Revenue Code. 103.8EFFECTIVE DATE.This section is effective for taxable years beginning after 103.9December 31, 2012.103.10    Sec. 8. Minnesota Statutes 2012, section 290.01, subdivision 19c, is amended to read:103.11    Subd. 19c. Corporations; additions to federal taxable income. For corporations, 103.12there shall be added to federal taxable income:103.13    (1) the amount of any deduction taken for federal income tax purposes for income, 103.14excise, or franchise taxes based on net income or related minimum taxes, including but not 103.15limited to the tax imposed under section 
         290.0922, paid by the corporation to Minnesota, 103.16another state, a political subdivision of another state, the District of Columbia, or any 103.17foreign country or possession of the United States;103.18    (2) interest not subject to federal tax upon obligations of: the United States, its 103.19possessions, its agencies, or its instrumentalities; the state of Minnesota or any other 103.20state, any of its political or governmental subdivisions, any of its municipalities, or any 103.21of its governmental agencies or instrumentalities; the District of Columbia; or Indian 103.22tribal governments;103.23    (3) exempt-interest dividends received as defined in section 852(b)(5) of the Internal 103.24Revenue Code;103.25    (4) the amount of any net operating loss deduction taken for federal income tax 103.26purposes under section 172 or 832(c)(10) of the Internal Revenue Code or operations loss 103.27deduction under section 810 of the Internal Revenue Code;103.28    (5) the amount of any special deductions taken for federal income tax purposes 103.29under sections 241 to 247 and 965 of the Internal Revenue Code;103.30    (6) losses from the business of mining, as defined in section 
         290.05, subdivision 1, 103.31clause (a), that are not subject to Minnesota income tax;103.32    (7) the amount of any capital losses deducted for federal income tax purposes under 103.33sections 1211 and 1212 of the Internal Revenue Code;103.34    (8) the exempt foreign trade income of a foreign sales corporation under sections 103.35921(a) and 291 of the Internal Revenue Code;104.1    (9) (8) the amount of percentage depletion deducted under sections 611 through 104.2614 and 291 of the Internal Revenue Code;104.3    (10) (9) for certified pollution control facilities placed in service in a taxable year 104.4beginning before December 31, 1986, and for which amortization deductions were elected 104.5under section 169 of the Internal Revenue Code of 1954, as amended through December 104.631, 1985, the amount of the amortization deduction allowed in computing federal taxable 104.7income for those facilities;104.8    (11) the amount of any deemed dividend from a foreign operating corporation 104.9determined pursuant to section 290.17, subdivision 4, paragraph (g). The deemed dividend 104.10shall be reduced by the amount of the addition to income required by clauses (20), (21), 104.11(22), and (23);104.12    (12) (10) the amount of a partner's pro rata share of net income which does not flow 104.13through to the partner because the partnership elected to pay the tax on the income under 104.14section 6242(a)(2) of the Internal Revenue Code;104.15    (13) the amount of net income excluded under section 114 of the Internal Revenue 104.16Code;104.17    (14) (11) any increase in subpart F income, as defined in section 952(a) of the 104.18Internal Revenue Code, for the taxable year when subpart F income is calculated without 104.19regard to the provisions of Division C, title III, section 303(b) of Public Law 110-343;104.20    (15) (12) 80 percent of the depreciation deduction allowed under section 104.21168(k)(1)(A) and (k)(4)(A) of the Internal Revenue Code. For purposes of this clause, if 104.22the taxpayer has an activity that in the taxable year generates a deduction for depreciation 104.23under section 168(k)(1)(A) and (k)(4)(A) and the activity generates a loss for the taxable 104.24year that the taxpayer is not allowed to claim for the taxable year, "the depreciation 104.25allowed under section 168(k)(1)(A) and (k)(4)(A)" for the taxable year is limited to excess 104.26of the depreciation claimed by the activity under section 168(k)(1)(A) and (k)(4)(A) 104.27over the amount of the loss from the activity that is not allowed in the taxable year. In 104.28succeeding taxable years when the losses not allowed in the taxable year are allowed, the 104.29depreciation under section 168(k)(1)(A) and (k)(4)(A) is allowed;104.30    (16) (13) 80 percent of the amount by which the deduction allowed by section 179 of 104.31the Internal Revenue Code exceeds the deduction allowable by section 179 of the Internal 104.32Revenue Code of 1986, as amended through December 31, 2003;104.33    (17) (14) to the extent deducted in computing federal taxable income, the amount of 104.34the deduction allowable under section 199 of the Internal Revenue Code;104.35    (18) for taxable years beginning before January 1, 2013, the exclusion allowed under 104.36section 139A of the Internal Revenue Code for federal subsidies for prescription drug plans;105.1    (19) (15) the amount of expenses disallowed under section 
         290.10, subdivision 2; and105.2    (20) an amount equal to the interest and intangible expenses, losses, and costs paid, 105.3accrued, or incurred by any member of the taxpayer's unitary group to or for the benefit 105.4of a corporation that is a member of the taxpayer's unitary business group that qualifies 105.5as a foreign operating corporation. For purposes of this clause, intangible expenses and 105.6costs include:105.7    (i) expenses, losses, and costs for, or related to, the direct or indirect acquisition, 105.8use, maintenance or management, ownership, sale, exchange, or any other disposition of 105.9intangible property;105.10    (ii) losses incurred, directly or indirectly, from factoring transactions or discounting 105.11transactions;105.12    (iii) royalty, patent, technical, and copyright fees;105.13    (iv) licensing fees; and105.14    (v) other similar expenses and costs.105.15For purposes of this clause, "intangible property" includes stocks, bonds, patents, patent 105.16applications, trade names, trademarks, service marks, copyrights, mask works, trade 105.17secrets, and similar types of intangible assets.105.18This clause does not apply to any item of interest or intangible expenses or costs paid, 105.19accrued, or incurred, directly or indirectly, to a foreign operating corporation with respect 105.20to such item of income to the extent that the income to the foreign operating corporation 105.21is income from sources without the United States as defined in subtitle A, chapter 1, 105.22subchapter N, part 1, of the Internal Revenue Code;105.23    (21) except as already included in the taxpayer's taxable income pursuant to clause 105.24(20), any interest income and income generated from intangible property received or 105.25accrued by a foreign operating corporation that is a member of the taxpayer's unitary 105.26group. For purposes of this clause, income generated from intangible property includes:105.27    (i) income related to the direct or indirect acquisition, use, maintenance or 105.28management, ownership, sale, exchange, or any other disposition of intangible property;105.29    (ii) income from factoring transactions or discounting transactions;105.30    (iii) royalty, patent, technical, and copyright fees;105.31    (iv) licensing fees; and105.32    (v) other similar income.105.33For purposes of this clause, "intangible property" includes stocks, bonds, patents, patent 105.34applications, trade names, trademarks, service marks, copyrights, mask works, trade 105.35secrets, and similar types of intangible assets.106.1This clause does not apply to any item of interest or intangible income received or accrued 106.2by a foreign operating corporation with respect to such item of income to the extent that 106.3the income is income from sources without the United States as defined in subtitle A, 106.4chapter 1, subchapter N, part 1, of the Internal Revenue Code;106.5    (22) the dividends attributable to the income of a foreign operating corporation that 106.6is a member of the taxpayer's unitary group in an amount that is equal to the dividends 106.7paid deduction of a real estate investment trust under section 561(a) of the Internal 106.8Revenue Code for amounts paid or accrued by the real estate investment trust to the 106.9foreign operating corporation;106.10    (23) the income of a foreign operating corporation that is a member of the taxpayer's 106.11unitary group in an amount that is equal to gains derived from the sale of real or personal 106.12property located in the United States;106.13    (24) for taxable years beginning before January 1, 2010, the additional amount 106.14allowed as a deduction for donation of computer technology and equipment under section 106.15170(e)(6) of the Internal Revenue Code, to the extent deducted from taxable income; and106.16(25) (16) discharge of indebtedness income resulting from reacquisition of business 106.17indebtedness and deferred under section 108(i) of the Internal Revenue Code.106.18EFFECTIVE DATE.This section is effective for taxable years beginning after 106.19December 31, 2012.106.20    Sec. 9. Minnesota Statutes 2012, section 290.01, subdivision 19d, is amended to read:106.21    Subd. 19d. Corporations; modifications decreasing federal taxable income. For 106.22corporations, there shall be subtracted from federal taxable income after the increases 106.23provided in subdivision 19c:106.24    (1) the amount of foreign dividend gross-up added to gross income for federal 106.25income tax purposes under section 78 of the Internal Revenue Code;106.26    (2) the amount of salary expense not allowed for federal income tax purposes due to 106.27claiming the work opportunity credit under section 51 of the Internal Revenue Code;106.28    (3) any dividend (not including any distribution in liquidation) paid within the 106.29taxable year by a national or state bank to the United States, or to any instrumentality of 106.30the United States exempt from federal income taxes, on the preferred stock of the bank 106.31owned by the United States or the instrumentality;106.32    (4) amounts disallowed for intangible drilling costs due to differences between 106.33this chapter and the Internal Revenue Code in taxable years beginning before January 106.341, 1987, as follows:107.1    (i) to the extent the disallowed costs are represented by physical property, an amount 107.2equal to the allowance for depreciation under Minnesota Statutes 1986, section 
         290.09, 107.3subdivision 7
         , subject to the modifications contained in subdivision 19e; and107.4    (ii) to the extent the disallowed costs are not represented by physical property, an 107.5amount equal to the allowance for cost depletion under Minnesota Statutes 1986, section 107.6290.09, subdivision 8
         ;107.7    (5) the deduction for capital losses pursuant to sections 1211 and 1212 of the 107.8Internal Revenue Code, except that:107.9    (i) for capital losses incurred in taxable years beginning after December 31, 1986, 107.10capital loss carrybacks shall not be allowed;107.11    (ii) for capital losses incurred in taxable years beginning after December 31, 1986, 107.12a capital loss carryover to each of the 15 taxable years succeeding the loss year shall be 107.13allowed;107.14    (iii) for capital losses incurred in taxable years beginning before January 1, 1987, a 107.15capital loss carryback to each of the three taxable years preceding the loss year, subject to 107.16the provisions of Minnesota Statutes 1986, section 
         290.16, shall be allowed; and107.17    (iv) for capital losses incurred in taxable years beginning before January 1, 1987, 107.18a capital loss carryover to each of the five taxable years succeeding the loss year to the 107.19extent such loss was not used in a prior taxable year and subject to the provisions of 107.20Minnesota Statutes 1986, section 
         290.16, shall be allowed;107.21    (6) an amount for interest and expenses relating to income not taxable for federal 107.22income tax purposes, if (i) the income is taxable under this chapter and (ii) the interest and 107.23expenses were disallowed as deductions under the provisions of section 171(a)(2), 265 or 107.24291 of the Internal Revenue Code in computing federal taxable income;107.25    (7) in the case of mines, oil and gas wells, other natural deposits, and timber for 107.26which percentage depletion was disallowed pursuant to subdivision 19c, clause (9) (8), a 107.27reasonable allowance for depletion based on actual cost. In the case of leases the deduction 107.28must be apportioned between the lessor and lessee in accordance with rules prescribed 107.29by the commissioner. In the case of property held in trust, the allowable deduction must 107.30be apportioned between the income beneficiaries and the trustee in accordance with the 107.31pertinent provisions of the trust, or if there is no provision in the instrument, on the basis 107.32of the trust's income allocable to each;107.33    (8) for certified pollution control facilities placed in service in a taxable year 107.34beginning before December 31, 1986, and for which amortization deductions were elected 107.35under section 169 of the Internal Revenue Code of 1954, as amended through December 108.131, 1985, an amount equal to the allowance for depreciation under Minnesota Statutes 108.21986, section 
         290.09, subdivision 7;108.3    (9) amounts included in federal taxable income that are due to refunds of income, 108.4excise, or franchise taxes based on net income or related minimum taxes paid by the 108.5corporation to Minnesota, another state, a political subdivision of another state, the 108.6District of Columbia, or a foreign country or possession of the United States to the extent 108.7that the taxes were added to federal taxable income under section 290.01, subdivision 19c, 108.8clause (1), in a prior taxable year;108.9    (10) 80 percent of royalties, fees, or other like income accrued or received from a 108.10foreign operating corporation or a foreign corporation which is part of the same unitary 108.11business as the receiving corporation, unless the income resulting from such payments or 108.12accruals is income from sources within the United States as defined in subtitle A, chapter 108.131, subchapter N, part 1, of the Internal Revenue Code;108.14    (11) (10) income or gains from the business of mining as defined in section 
         290.05, 108.15subdivision 1
         , clause (a), that are not subject to Minnesota franchise tax;108.16    (12) (11) the amount of disability access expenditures in the taxable year which are not 108.17allowed to be deducted or capitalized under section 44(d)(7) of the Internal Revenue Code;108.18    (13) (12) the amount of qualified research expenses not allowed for federal income 108.19tax purposes under section 280C(c) of the Internal Revenue Code, but only to the extent 108.20that the amount exceeds the amount of the credit allowed under section 
         290.068;108.21    (14) (13) the amount of salary expenses not allowed for federal income tax purposes 108.22due to claiming the Indian employment credit under section 45A(a) of the Internal 108.23Revenue Code;108.24    (15) for a corporation whose foreign sales corporation, as defined in section 922 108.25of the Internal Revenue Code, constituted a foreign operating corporation during any 108.26taxable year ending before January 1, 1995, and a return was filed by August 15, 1996, 108.27claiming the deduction under section 290.21, subdivision 4, for income received from 108.28the foreign operating corporation, an amount equal to 1.23 multiplied by the amount of 108.29income excluded under section 114 of the Internal Revenue Code, provided the income is 108.30not income of a foreign operating company;108.31    (16) (14) any decrease in subpart F income, as defined in section 952(a) of the 108.32Internal Revenue Code, for the taxable year when subpart F income is calculated without 108.33regard to the provisions of Division C, title III, section 303(b) of Public Law 110-343;108.34    (17) (15) in each of the five tax years immediately following the tax year in which an 108.35addition is required under subdivision 19c, clause (15) (12), an amount equal to one-fifth 108.36of the delayed depreciation. For purposes of this clause, "delayed depreciation" means the 109.1amount of the addition made by the taxpayer under subdivision 19c, clause (15) (12). The 109.2resulting delayed depreciation cannot be less than zero;109.3    (18) (16) in each of the five tax years immediately following the tax year in which an 109.4addition is required under subdivision 19c, clause (16) (13), an amount equal to one-fifth 109.5of the amount of the addition; and109.6(19) (17) to the extent included in federal taxable income, discharge of indebtedness 109.7income resulting from reacquisition of business indebtedness included in federal taxable 109.8income under section 108(i) of the Internal Revenue Code. This subtraction applies only 109.9to the extent that the income was included in net income in a prior year as a result of the 109.10addition under section 290.01, subdivision 19c, clause (25). (16); and109.11(18) the amount of expenses not allowed for federal income tax purposes due 109.12to claiming the railroad track maintenance credit under section 45G(a) of the Internal 109.13Revenue Code.109.14EFFECTIVE DATE.This section is effective for taxable years beginning after 109.15December 31, 2012.109.16    Sec. 10. Minnesota Statutes 2012, section 290.06, subdivision 2c, is amended to read:109.17    Subd. 2c. Schedules of rates for individuals, estates, and trusts. (a) The income 109.18taxes imposed by this chapter upon married individuals filing joint returns and surviving 109.19spouses as defined in section 2(a) of the Internal Revenue Code must be computed by 109.20applying to their taxable net income the following schedule of rates:109.21    (1) On the first $25,680 $35,480, 5.35 percent;109.22    (2) On all over $25,680 $35,480, but not over $102,030 $140,960, 7.05 percent;109.23    (3) On all over $102,030 $140,960, but not over $250,000, 7.85 percent.;109.24(4) On all over $250,000, 9.85 percent.109.25    Married individuals filing separate returns, estates, and trusts must compute their 109.26income tax by applying the above rates to their taxable income, except that the income 109.27brackets will be one-half of the above amounts.109.28    (b) The income taxes imposed by this chapter upon unmarried individuals must be 109.29computed by applying to taxable net income the following schedule of rates:109.30    (1) On the first $17,570 $24,270, 5.35 percent;109.31    (2) On all over $17,570 $24,270, but not over $57,710 $79,730, 7.05 percent;109.32    (3) On all over $57,710 $79,730, but not over $150,000, 7.85 percent.;109.33(4) On all over $150,000, 9.85 percent.110.1    (c) The income taxes imposed by this chapter upon unmarried individuals qualifying 110.2as a head of household as defined in section 2(b) of the Internal Revenue Code must be 110.3computed by applying to taxable net income the following schedule of rates:110.4    (1) On the first $21,630 $29,880, 5.35 percent;110.5    (2) On all over $21,630 $29,880, but not over $86,910 $120,070, 7.05 percent;110.6    (3) On all over $86,910 $120,070, but not over $200,000, 7.85 percent.;110.7(4) On all over $200,000, 9.85 percent.110.8    (d) In lieu of a tax computed according to the rates set forth in this subdivision, the 110.9tax of any individual taxpayer whose taxable net income for the taxable year is less than 110.10an amount determined by the commissioner must be computed in accordance with tables 110.11prepared and issued by the commissioner of revenue based on income brackets of not 110.12more than $100. The amount of tax for each bracket shall be computed at the rates set 110.13forth in this subdivision, provided that the commissioner may disregard a fractional part of 110.14a dollar unless it amounts to 50 cents or more, in which case it may be increased to $1.110.15    (e) An individual who is not a Minnesota resident for the entire year must compute 110.16the individual's Minnesota income tax as provided in this subdivision. After the 110.17application of the nonrefundable credits provided in this chapter, the tax liability must 110.18then be multiplied by a fraction in which:110.19    (1) the numerator is the individual's Minnesota source federal adjusted gross income 110.20as defined in section 62 of the Internal Revenue Code and increased by the additions 110.21required under section 
         290.01, subdivision 19a, clauses (1), (5), (6), (7), (8), (9), (12), 110.22(13), and (16) to (18), and reduced by the Minnesota assignable portion of the subtraction 110.23for United States government interest under section 
         290.01, subdivision 19b, clause 110.24(1), and the subtractions under section 
         290.01, subdivision 19b, clauses (8), (9), (13), 110.25(14), (16), and (17), after applying the allocation and assignability provisions of section 110.26290.081
         , clause (a), or 
         290.17; and110.27    (2) the denominator is the individual's federal adjusted gross income as defined in 110.28section 62 of the Internal Revenue Code of 1986, increased by the amounts specified in 110.29section 
         290.01, subdivision 19a, clauses (1), (5), (6), (7), (8), (9), (12), (13), and (16) to 110.30(18), and reduced by the amounts specified in section 
         290.01, subdivision 19b, clauses (1), 110.31(8), (9), (13), (14), (16), and (17).110.32EFFECTIVE DATE.This section is effective for taxable years beginning after 110.33December 31, 2012.110.34    Sec. 11. Minnesota Statutes 2012, section 290.06, subdivision 2d, is amended to read:111.1    Subd. 2d. Inflation adjustment of brackets. (a) For taxable years beginning after 111.2December 31, 2000 2013, the minimum and maximum dollar amounts for each rate 111.3bracket for which a tax is imposed in subdivision 2c shall be adjusted for inflation by the 111.4percentage determined under paragraph (b). For the purpose of making the adjustment as 111.5provided in this subdivision all of the rate brackets provided in subdivision 2c shall be the 111.6rate brackets as they existed for taxable years beginning after December 31, 1999 2012, 111.7and before January 1, 2001 2014. The rate applicable to any rate bracket must not be 111.8changed. The dollar amounts setting forth the tax shall be adjusted to reflect the changes 111.9in the rate brackets. The rate brackets as adjusted must be rounded to the nearest $10 111.10amount. If the rate bracket ends in $5, it must be rounded up to the nearest $10 amount.111.11(b) The commissioner shall adjust the rate brackets and by the percentage determined 111.12pursuant to the provisions of section 1(f) of the Internal Revenue Code, except that in 111.13section 1(f)(3)(B) the word "1999" "2012" shall be substituted for the word "1992." For 111.142001 2014, the commissioner shall then determine the percent change from the 12 months 111.15ending on August 31, 1999 2012, to the 12 months ending on August 31, 2000 2013, and 111.16in each subsequent year, from the 12 months ending on August 31, 1999 2012, to the 12 111.17months ending on August 31 of the year preceding the taxable year. The determination of 111.18the commissioner pursuant to this subdivision shall not be considered a "rule" and shall 111.19not be subject to the Administrative Procedure Act contained in chapter 14.111.20No later than December 15 of each year, the commissioner shall announce the 111.21specific percentage that will be used to adjust the tax rate brackets.111.22EFFECTIVE DATE.This section is effective for taxable years beginning after 111.23December 31, 2012.111.24    Sec. 12. Minnesota Statutes 2012, section 290.06, is amended by adding a subdivision 111.25to read:111.26    Subd. 36.Greater Minnesota internship credit.(a) A taxpayer who is an eligible 111.27employer may take a credit against the tax due under this chapter equal to the lesser of:111.28(1) 40 percent of the compensation paid to an intern qualifying under the program 111.29established under section 136A.129, but not to exceed $2,000 per intern; or111.30(2) the amount certified to the taxpayer by an eligible institution out of the 111.31institution's allocation of credits for the calendar year, as provided in section 136A.129.111.32(b) Credits allowed to a partnership, a limited liability company taxed as a 111.33partnership, an S corporation, or multiple owners of property are passed through to the 111.34partners, members, shareholders, or owners, respectively, pro rata to each partner, member, 111.35shareholder, or owner based on their share of the entity's income for the taxable year.112.1(c) If the amount of credit which the taxpayer is eligible to receive under this 112.2subdivision exceeds the taxpayer's tax liability under this chapter, the commissioner of 112.3revenue shall refund the excess to the taxpayer.112.4(d) An amount necessary to pay claims for refund provided in this subdivision is 112.5appropriated from the general fund to the commissioner of revenue.112.6(e) An amount equal to one percent of the total amount of the credits authorized 112.7under section 136A.129, subdivision 4, for an administrative fee for the Office of Higher 112.8Education and participating eligible institutions is appropriated from the general fund to 112.9the commissioner of revenue, for a transfer to the Office of Higher Education.112.10(f) For purposes of this subdivision, the terms "eligible employer" and "eligible 112.11institution" have the meanings given in section 136A.129.112.12EFFECTIVE DATE.This section is effective for taxable years beginning after 112.13December 31, 2013.112.14    Sec. 13. Minnesota Statutes 2012, section 290.0677, subdivision 2, is amended to read:112.15    Subd. 2. Definitions. (a) For purposes of this section, the following terms have 112.16the meanings given.112.17    (b) "Designated area" means a:112.18    (1) combat zone designated by Executive Order from the President of the United 112.19States;112.20    (2) qualified hazardous duty area, designated in Public Law; or112.21    (3) location certified by the U. S. Department of Defense as eligible for combat zone 112.22tax benefits due to the location's direct support of military operations.112.23    (c) "Active military service" means active duty service in any of the United States 112.24armed forces, the National Guard, or reserves.112.25    (d) "Qualified individual" means an individual who has:112.26    (1) either (i) met one of the following criteria:112.27    (i) has served at least 20 years in the military or;112.28    (ii) has a service-connected disability rating of 100 percent for a total and permanent 112.29disability; or112.30    (iii) has been determined by the military to be eligible for compensation from a 112.31pension or other retirement pay from the federal government for service in the military, 112.32as computed under United States Code, title 10, sections 1401 to 1414, 1447 to 1455, 112.33or 12733; and112.34    (2) separated from military service before the end of the taxable year.113.1    (e) "Adjusted gross income" has the meaning given in section 61 of the Internal 113.2Revenue Code.113.3EFFECTIVE DATE.This section is effective for taxable years beginning after 113.4December 31, 2012.113.5    Sec. 14. Minnesota Statutes 2012, section 290.068, subdivision 3, is amended to read:113.6    Subd. 3. Limitation; carryover. (a)(1) The credit for a taxable year beginning 113.7before January 1, 2010, and after December 31, 2012, shall not exceed the liability for tax. 113.8"Liability for tax" for purposes of this section means the sum of the tax imposed under 113.9section 
         290.06, subdivision subdivisions 1 and 2c, for the taxable year reduced by the sum 113.10of the nonrefundable credits allowed under this chapter, on all of the entities required to 113.11be included on the combined report of the unitary business. If the amount of the credit 113.12allowed exceeds the liability for tax of the taxpayer, but is allowed as a result of the 113.13liability for tax of other members of the unitary group for the taxable year, the taxpayer 113.14must allocate the excess as a research credit to another member of the unitary group.113.15    (2) In the case of a corporation which is a partner in a partnership, the credit allowed 113.16for the taxable year shall not exceed the lesser of the amount determined under clause (1) 113.17for the taxable year or an amount (separately computed with respect to the corporation's 113.18interest in the trade or business or entity) equal to the amount of tax attributable to that 113.19portion of taxable income which is allocable or apportionable to the corporation's interest 113.20in the trade or business or entity.113.21    (b) If the amount of the credit determined under this section for any taxable year 113.22exceeds the limitation under clause (a) including amounts allocated to other members 113.23of the unitary group, the excess shall be a research credit carryover to each of the 15 113.24succeeding taxable years. The entire amount of the excess unused credit for the taxable 113.25year shall be carried first to the earliest of the taxable years to which the credit may be 113.26carried and then to each successive year to which the credit may be carried. The amount 113.27of the unused credit which may be added under this clause shall not exceed the taxpayer's 113.28liability for tax less the research credit for the taxable year.113.29EFFECTIVE DATE.This section is effective for taxable years beginning after 113.30December 31, 2012.113.31    Sec. 15. Minnesota Statutes 2012, section 290.068, subdivision 6a, is amended to read:113.32    Subd. 6a. Credit to be refundable. If the amount of credit allowed in this section 113.33for qualified research expenses incurred in taxable years beginning after December 31, 114.12009, and before January 1, 2013, exceeds the taxpayer's tax liability under this chapter, 114.2the commissioner shall refund the excess amount. The credit allowed for qualified research 114.3expenses incurred in taxable years beginning after December 31, 2009, and before January 114.41, 2013,  must be used before any research credit earned under subdivision 3.114.5EFFECTIVE DATE.This section is effective for taxable years beginning after 114.6December 31, 2012.114.7    Sec. 16. Minnesota Statutes 2012, section 290.0681, subdivision 1, is amended to read:114.8    Subdivision 1. Definitions. (a) For purposes of this section, the following terms 114.9have the meanings given.114.10(b) "Account" means the historic credit administration account in the special 114.11revenue fund.114.12(c) "Office" means the State Historic Preservation Office of the Minnesota Historical 114.13Society.114.14(d) "Project" means rehabilitation of a certified historic structure, as defined in 114.15section 47(c)(3)(A) of the Internal Revenue Code, that is located in Minnesota and is 114.16allowed a federal credit under section 47(a)(2) of the Internal Revenue Code.114.17(e) "Society" means the Minnesota Historical Society.114.18(f) "Federal credit" means the credit allowed under section 47(a)(2) of the Internal 114.19Revenue Code.114.20(g) "Placed in service" has the meaning used in section 47 of the Internal Revenue 114.21Code.114.22(h) "Qualified rehabilitation expenditures" has the meaning given in section 47 of 114.23the Internal Revenue Code.114.24EFFECTIVE DATE.This section is effective the day following final enactment.114.25    Sec. 17. Minnesota Statutes 2012, section 290.0681, subdivision 3, is amended to read:114.26    Subd. 3. Applications; allocations. (a) To qualify for a credit or grant under this 114.27section, the developer of a project must apply to the office before the rehabilitation begins. 114.28The application must contain the information and be in the form prescribed by the office. 114.29The office may collect a fee for application of up to $5,000 0.5 percent of qualified 114.30rehabilitation expenditures, up to $40,000, based on estimated qualified rehabilitation 114.31expenses expenditures, to offset costs associated with personnel and administrative 114.32expenses related to administering the credit and preparing the economic impact report 114.33in subdivision 9. Application fees are deposited in the account. The application must 115.1indicate if the application is for a credit or a grant in lieu of the credit or a combination of 115.2the two and designate the taxpayer qualifying for the credit or the recipient of the grant.115.3    (b) Upon approving an application for credit, the office shall issue allocation 115.4certificates that:115.5    (1) verify eligibility for the credit or grant;115.6    (2) state the amount of credit or grant anticipated with the project, with the credit 115.7amount equal to 100 percent and the grant amount equal to 90 percent of the federal 115.8credit anticipated in the application;115.9    (3) state that the credit or grant allowed may increase or decrease if the federal 115.10credit the project receives at the time it is placed in service is different than the amount 115.11anticipated at the time the allocation certificate is issued; and115.12    (4) state the fiscal year in which the credit or grant is allocated, and that the taxpayer 115.13or grant recipient is entitled to receive the credit or grant at the time the project is placed 115.14in service, provided that date is within three calendar years following the issuance of 115.15the allocation certificate.115.16    (c) The office, in consultation with the commissioner of revenue, shall determine 115.17if the project is eligible for a credit or a grant under this section and must notify the 115.18developer in writing of its determination. Eligibility for the credit is subject to review 115.19and audit by the commissioner of revenue.115.20    (d) The federal credit recapture and repayment requirements under section 50 of the 115.21Internal Revenue Code do not apply to the credit allowed under this section.115.22(e) Any decision of the office under paragraph (c) may be challenged as a contested 115.23case under chapter 14. The contested case proceeding must be initiated within 45 days of 115.24the date of written notification by the office.115.25EFFECTIVE DATE.This section is effective the day following final enactment 115.26and the change in paragraph (a) applies to applications first received on or after the day 115.27following final enactment.115.28    Sec. 18. Minnesota Statutes 2012, section 290.0681, subdivision 4, is amended to read:115.29    Subd. 4. Credit certificates; grants. (a)(1) The developer of a project for which the 115.30office has issued an allocation certificate must notify the office when the project is placed 115.31in service. Upon verifying that the project has been placed in service, and was allowed a 115.32federal credit, the office must issue a credit certificate to the taxpayer designated in the 115.33application or must issue a grant to the recipient designated in the application. The credit 115.34certificate must state the amount of the credit.115.35    (2) The credit amount equals the federal credit allowed for the project.116.1    (3) The grant amount equals 90 percent of the federal credit allowed for the project.116.2    (b) The recipient of a credit certificate may assign the certificate to another taxpayer, 116.3which is then allowed the credit under this section or section 
         297I.20, subdivision 3.  An 116.4assignment is not valid unless the assignee notifies the commissioner within 30 days of the 116.5date that the assignment is made. The commissioner shall prescribe the forms necessary 116.6for notifying the commissioner of the assignment of a credit certificate and for claiming 116.7a credit by assignment.116.8    (c) Credits passed through to partners, members, shareholders, or owners pursuant to 116.9subdivision 5 are not an assignment of a credit certificate under this subdivision.116.10    (d) A grant agreement between the office and the recipient of a grant may allow the 116.11grant to be issued to another individual or entity.116.12EFFECTIVE DATE.This section is effective the day following final enactment.116.13    Sec. 19. Minnesota Statutes 2012, section 290.0681, subdivision 5, is amended to read:116.14    Subd. 5. Partnerships; multiple owners. Credits granted to a partnership, a limited 116.15liability company taxed as a partnership, S corporation, or multiple owners of property 116.16are passed through to the partners, members, shareholders, or owners, respectively, pro 116.17rata to each partner, member, shareholder, or owner based on their share of the entity's 116.18assets or as specially allocated in their organizational documents or any other executed 116.19agreement, as of the last day of the taxable year.116.20EFFECTIVE DATE.This section is effective the day following final enactment.116.21    Sec. 20. Minnesota Statutes 2012, section 290.0681, subdivision 10, is amended to read:116.22    Subd. 10. Sunset. This section expires after fiscal year 2015 2021, except that 116.23the office's authority to issue credit certificates under subdivision 4 based on allocation 116.24certificates that were issued before fiscal year 2016 2022 remains in effect through 2018116.25 2024, and the reporting requirements in subdivision 9 remain in effect through the year 116.26following the year in which all allocation certificates have either been canceled or resulted 116.27in issuance of credit certificates, or 2019 2025, whichever is earlier.116.28EFFECTIVE DATE.This section is effective the day following final enactment.116.29    Sec. 21. Minnesota Statutes 2012, section 290.091, subdivision 1, is amended to read:116.30    Subdivision 1. Imposition of tax. In addition to all other taxes imposed by this 116.31chapter a tax is imposed on individuals, estates, and trusts equal to the excess (if any) of117.1(a) an amount equal to 6.4 6.75 percent of alternative minimum taxable income after 117.2subtracting the exemption amount, over117.3(b) the regular tax for the taxable year.117.4EFFECTIVE DATE.This section is effective for taxable years beginning after 117.5December 31, 2012.117.6    Sec. 22. Minnesota Statutes 2012, section 290.091, subdivision 2, is amended to read:117.7    Subd. 2. Definitions. For purposes of the tax imposed by this section, the following 117.8terms have the meanings given:117.9    (a) "Alternative minimum taxable income" means the sum of the following for 117.10the taxable year:117.11    (1) the taxpayer's federal alternative minimum taxable income as defined in section 117.1255(b)(2) of the Internal Revenue Code;117.13    (2) the taxpayer's itemized deductions allowed in computing federal alternative 117.14minimum taxable income, but excluding:117.15    (i) the charitable contribution deduction under section 170 of the Internal Revenue 117.16Code;117.17    (ii) the medical expense deduction;117.18    (iii) the casualty, theft, and disaster loss deduction; and117.19    (iv) the impairment-related work expenses of a disabled person;117.20    (3) for depletion allowances computed under section 613A(c) of the Internal 117.21Revenue Code, with respect to each property (as defined in section 614 of the Internal 117.22Revenue Code), to the extent not included in federal alternative minimum taxable income, 117.23the excess of the deduction for depletion allowable under section 611 of the Internal 117.24Revenue Code for the taxable year over the adjusted basis of the property at the end of the 117.25taxable year (determined without regard to the depletion deduction for the taxable year);117.26    (4) to the extent not included in federal alternative minimum taxable income, the 117.27amount of the tax preference for intangible drilling cost under section 57(a)(2) of the 117.28Internal Revenue Code determined without regard to subparagraph (E);117.29    (5) to the extent not included in federal alternative minimum taxable income, the 117.30amount of interest income as provided by section 
         290.01, subdivision 19a, clause (1); and117.31    (6) the amount of addition required by section 
         290.01, subdivision 19a, clauses (7) 117.32to (9), (12), (13), and (16) to (18);117.33    less the sum of the amounts determined under the following:117.34    (1) interest income as defined in section 
         290.01, subdivision 19b, clause (1);118.1    (2) an overpayment of state income tax as provided by section 
         290.01, subdivision 118.219b
         , clause (2), to the extent included in federal alternative minimum taxable income;118.3    (3) the amount of investment interest paid or accrued within the taxable year on 118.4indebtedness to the extent that the amount does not exceed net investment income, as 118.5defined in section 163(d)(4) of the Internal Revenue Code. Interest does not include 118.6amounts deducted in computing federal adjusted gross income;118.7    (4) amounts subtracted from federal taxable income as provided by section 
         290.01, 118.8subdivision 19b
         , clauses (6), (8) to (14), and (16); and118.9(5) the amount of the net operating loss allowed under section 
         290.095, subdivision 118.1011
         , paragraph (c).118.11    In the case of an estate or trust, alternative minimum taxable income must be 118.12computed as provided in section 59(c) of the Internal Revenue Code.118.13    (b) "Investment interest" means investment interest as defined in section 163(d)(3) 118.14of the Internal Revenue Code.118.15    (c) "Net minimum tax" means the minimum tax imposed by this section.118.16    (d) "Regular tax" means the tax that would be imposed under this chapter (without 118.17regard to this section and section 290.032), reduced by the sum of the nonrefundable 118.18credits allowed under this chapter.118.19    (e) "Tentative minimum tax" equals 6.4 6.75 percent of alternative minimum taxable 118.20income after subtracting the exemption amount determined under subdivision 3.118.21EFFECTIVE DATE.This section is effective for taxable years beginning after 118.22December 31, 2012.118.23    Sec. 23. Minnesota Statutes 2012, section 290.091, subdivision 6, is amended to read:118.24    Subd. 6. Credit for prior years' liability. (a) A credit is allowed against the tax 118.25imposed by this chapter on individuals, trusts, and estates equal to the minimum tax 118.26credit for the taxable year. The minimum tax credit equals the adjusted net minimum 118.27tax for taxable years beginning after December 31, 1988, reduced by the minimum tax 118.28credits allowed in a prior taxable year. The credit may not exceed the excess (if any) for 118.29the taxable year of118.30(1) the regular tax, over118.31(2) the greater of (i) the tentative alternative minimum tax, or (ii) zero.118.32(b) The adjusted net minimum tax for a taxable year equals the lesser of the net 118.33minimum tax or the excess (if any) of118.34(1) the tentative minimum tax, over118.35(2) 6.4 6.75 percent of the sum of119.1(i) adjusted gross income as defined in section 62 of the Internal Revenue Code,119.2(ii) interest income as defined in section 
         290.01, subdivision 19a, clause (1),119.3(iii) interest on specified private activity bonds, as defined in section 57(a)(5) of the 119.4Internal Revenue Code, to the extent not included under clause (ii),119.5(iv) depletion as defined in section 57(a)(1), determined without regard to the last 119.6sentence of paragraph (1), of the Internal Revenue Code, less119.7(v) the deductions allowed in computing alternative minimum taxable income 119.8provided in subdivision 2, paragraph (a), clause (2) of the first series of clauses and clauses 119.9(1), (2), and (3) of the second series of clauses, and119.10(vi) the exemption amount determined under subdivision 3.119.11In the case of an individual who is not a Minnesota resident for the entire year, 119.12adjusted net minimum tax must be multiplied by the fraction defined in section 
         290.06, 119.13subdivision 2c
         , paragraph (e). In the case of a trust or estate, adjusted net minimum tax 119.14must be multiplied by the fraction defined under subdivision 4, paragraph (b).119.15EFFECTIVE DATE.This section is effective for taxable years beginning after 119.16December 31, 2012.119.17    Sec. 24. Minnesota Statutes 2012, section 290.0921, subdivision 3, is amended to read:119.18    Subd. 3. Alternative minimum taxable income. "Alternative minimum taxable 119.19income" is Minnesota net income as defined in section 
         290.01, subdivision 19, and 119.20includes the adjustments and tax preference items in sections 56, 57, 58, and 59(d), (e), 119.21(f), and (h) of the Internal Revenue Code. If a corporation files a separate company 119.22Minnesota tax return, the minimum tax must be computed on a separate company basis. 119.23If a corporation is part of a tax group filing a unitary return, the minimum tax must be 119.24computed on a unitary basis. The following adjustments must be made.119.25(1) For purposes of the depreciation adjustments under section 56(a)(1) and 119.2656(g)(4)(A) of the Internal Revenue Code, the basis for depreciable property placed in 119.27service in a taxable year beginning before January 1, 1990, is the adjusted basis for federal 119.28income tax purposes, including any modification made in a taxable year under section 119.29290.01, subdivision 19e
         , or Minnesota Statutes 1986, section 
         290.09, subdivision 7, 119.30paragraph (c).119.31For taxable years beginning after December 31, 2000, the amount of any remaining 119.32modification made under section 
         290.01, subdivision 19e, or Minnesota Statutes 1986, 119.33section 
         290.09, subdivision 7, paragraph (c), not previously deducted is a depreciation 119.34allowance in the first taxable year after December 31, 2000.120.1(2) The portion of the depreciation deduction allowed for federal income tax 120.2purposes under section 168(k) of the Internal Revenue Code that is required as an addition 120.3under section 
         290.01, subdivision 19c, clause (15) (12), is disallowed in determining 120.4alternative minimum taxable income.120.5(3) The subtraction for depreciation allowed under section 
         290.01, subdivision 120.619d
         , clause (17) (15), is allowed as a depreciation deduction in determining alternative 120.7minimum taxable income.120.8(4) The alternative tax net operating loss deduction under sections 56(a)(4) and 56(d) 120.9of the Internal Revenue Code does not apply.120.10(5) The special rule for certain dividends under section 56(g)(4)(C)(ii) of the Internal 120.11Revenue Code does not apply.120.12(6) The special rule for dividends from section 936 companies under section 120.1356(g)(4)(C)(iii) does not apply.120.14(7) (6) The tax preference for depletion under section 57(a)(1) of the Internal 120.15Revenue Code does not apply.120.16(8) (7) The tax preference for intangible drilling costs under section 57(a)(2) of the 120.17Internal Revenue Code must be calculated without regard to subparagraph (E) and the 120.18subtraction under section 
         290.01, subdivision 19d, clause (4).120.19(9) (8) The tax preference for tax exempt interest under section 57(a)(5) of the 120.20Internal Revenue Code does not apply.120.21(10) (9) The tax preference for charitable contributions of appreciated property 120.22under section 57(a)(6) of the Internal Revenue Code does not apply.120.23(11) (10) For purposes of calculating the tax preference for accelerated depreciation 120.24or amortization on certain property placed in service before January 1, 1987, under section 120.2557(a)(7) of the Internal Revenue Code, the deduction allowable for the taxable year is the 120.26deduction allowed under section 
         290.01, subdivision 19e.120.27For taxable years beginning after December 31, 2000, the amount of any remaining 120.28modification made under section 
         290.01, subdivision 19e, not previously deducted is a 120.29depreciation or amortization allowance in the first taxable year after December 31, 2004.120.30(12) (11) For purposes of calculating the adjustment for adjusted current earnings 120.31in section 56(g) of the Internal Revenue Code, the term "alternative minimum taxable 120.32income" as it is used in section 56(g) of the Internal Revenue Code, means alternative 120.33minimum taxable income as defined in this subdivision, determined without regard to the 120.34adjustment for adjusted current earnings in section 56(g) of the Internal Revenue Code.120.35(13) (12) For purposes of determining the amount of adjusted current earnings under 120.36section 56(g)(3) of the Internal Revenue Code, no adjustment shall be made under section 121.156(g)(4) of the Internal Revenue Code with respect to (i) the amount of foreign dividend 121.2gross-up subtracted as provided in section 
         290.01, subdivision 19d, clause (1), or (ii) the 121.3amount of refunds of income, excise, or franchise taxes subtracted as provided in section 121.4290.01, subdivision 19d
         , clause (9), or (iii) the amount of royalties, fees or other like 121.5income subtracted as provided in section 290.01, subdivision 19d, clause (10).121.6(14) (13) Alternative minimum taxable income excludes the income from operating 121.7in a job opportunity building zone as provided under section 
         469.317.121.8(15) (14) Alternative minimum taxable income excludes the income from operating 121.9in a biotechnology and health sciences industry zone as provided under section 
         469.337.121.10Items of tax preference must not be reduced below zero as a result of the 121.11modifications in this subdivision.121.12EFFECTIVE DATE.This section is effective for taxable years beginning after 121.13December 31, 2012.121.14    Sec. 25. Minnesota Statutes 2012, section 290.0922, subdivision 1, is amended to read:121.15    Subdivision 1. Imposition. (a) In addition to the tax imposed by this chapter without 121.16regard to this section, the franchise tax imposed on a corporation required to file under 121.17section 
         289A.08, subdivision 3, other than a corporation treated as an "S" corporation 121.18under section 
         290.9725 for the taxable year includes a tax equal to the following amounts:

121.19121.20If the sum of the corporation's Minnesota 
                  		property, payrolls, and sales or receipts is:the tax equals: 121.21less than$500,000$0121.22$500,000to$999,999$100121.23$1,000,000to$4,999,999$300121.24$5,000,000to$9,999,999$1,000121.25$10,000,000to$19,999,999$2,000121.26$20,000,000ormore$5,000121.27less than$930,000$0121.28$930,000to$1,869,999$190121.29$1,870,000to$9,339,999$560121.30$9,340,000to$18,679,999$1,870121.31$18,680,000to$37,359,999$3,740121.32$37,360,000ormore$9,340

121.33    (b) A tax is imposed for each taxable year on a corporation required to file a return 121.34under section 
         289A.12, subdivision 3, that is treated as an "S" corporation under section 121.35290.9725
          and on a partnership required to file a return under section 
         289A.12, subdivision 121.363
         , other than a partnership that derives over 80 percent of its income from farming. The 121.37tax imposed under this paragraph is due on or before the due date of the return for the 122.1taxpayer due under section 
         289A.18, subdivision 1. The commissioner shall prescribe 122.2the return to be used for payment of this tax. The tax under this paragraph is equal to 122.3the following amounts:

122.4122.5122.6122.7If the sum of the S corporation's 
                  		or partnership's Minnesota 
                  		property, payrolls, and sales or 
                  		receipts is:the tax equals: 122.8less than$500,000$0122.9$500,000to$999,999$100122.10$1,000,000to$4,999,999$300122.11$5,000,000to$9,999,999$1,000122.12$10,000,000to$19,999,999$2,000122.13$20,000,000ormore$5,000122.14less than$930,000$0122.15$930,000to$1,869,999$190122.16$1,870,000to$9,339,999$560122.17$9,340,000to$18,679,999$1,870122.18$18,680,000to$37,359,999$3,740122.19$37,360,000ormore$9,340

122.20    (c) The commissioner shall adjust the dollar amounts of both the tax and the property, 122.21payrolls, and sales or receipts thresholds in paragraphs (a) and (b) by the percentage 122.22determined pursuant to the provisions of section 1(f) of the Internal Revenue Code, except 122.23that in section 1(f)(3)(B) the word "2012" must be substituted for the word "1992." For 122.242014, the commissioner shall determine the percentage change from the 12 months ending 122.25on August 31, 2012, to the 12 months ending on August 31, 2013, and in each subsequent 122.26year, from the 12 months ending on August 31, 2012, to the 12 months ending on August 122.2731 of the year preceding the taxable year. The determination of the commissioner pursuant 122.28to this subdivision is not a "rule" subject to the Administrative Procedure Act contained in 122.29chapter 14. The tax amounts as adjusted must be rounded to the nearest $10 amount and 122.30the threshold amounts must be adjusted to the nearest $10,000 amount. For tax amounts 122.31that end in $5, the amount is rounded up to the nearest $10 amount and for the threshold 122.32amounts that end in $5,000, the amount is rounded up to the nearest $10,000.122.33EFFECTIVE DATE.This section is effective for taxable years beginning after 122.34December 31, 2012.122.35    Sec. 26. Minnesota Statutes 2012, section 290.095, subdivision 2, is amended to read:122.36    Subd. 2. Defined and limited. (a) The term "net operating loss" as used in this 122.37section shall mean a net operating loss as defined in section 172(c) of the Internal Revenue 122.38Code, with the modifications specified in subdivision 4. The deductions provided in 123.1section 
         290.21and the modification provided in section 290.01, subdivision 19d, clause 123.2(10), cannot be used in the determination of a net operating loss.123.3(b) The term "net operating loss deduction" as used in this section means the 123.4aggregate of the net operating loss carryovers to the taxable year, computed in accordance 123.5with subdivision 3. The provisions of section 172(b) of the Internal Revenue Code relating 123.6to the carryback of net operating losses, do not apply.123.7EFFECTIVE DATE.This section is effective for taxable years beginning after 123.8December 31, 2012.123.9    Sec. 27. Minnesota Statutes 2012, section 290.10, subdivision 1, is amended to read:123.10    Subdivision 1. Expenses, interest, and taxes.Except as provided in section 290.17, 123.11subdivision 4, paragraph (i), In computing the net income of a taxpayer no deduction shall 123.12in any case be allowed for expenses, interest and taxes connected with or allocable against 123.13the production or receipt of all income not included in the measure of the tax imposed by 123.14this chapter, except that for corporations engaged in the business of mining or producing 123.15iron ore, the mining of which is subject to the occupation tax imposed by section 
         298.01, 123.16subdivision 4
         , this shall not prevent the deduction of expenses and other items to the extent 123.17that the expenses and other items are allowable under this chapter and are not deductible, 123.18capitalizable, retainable in basis, or taken into account by allowance or otherwise in 123.19computing the occupation tax and do not exceed the amounts taken for federal income tax 123.20purposes for that year. Occupation taxes imposed under chapter 298, royalty taxes imposed 123.21under chapter 299, or depletion expenses may not be deducted under this subdivision.123.22    Sec. 28. Minnesota Statutes 2012, section 290.17, subdivision 4, is amended to read:123.23    Subd. 4. Unitary business principle. (a) If a trade or business conducted wholly 123.24within this state or partly within and partly without this state is part of a unitary business, 123.25the entire income of the unitary business is subject to apportionment pursuant to section 123.26290.191
         . Notwithstanding subdivision 2, paragraph (c), none of the income of a unitary 123.27business is considered to be derived from any particular source and none may be allocated 123.28to a particular place except as provided by the applicable apportionment formula. The 123.29provisions of this subdivision do not apply to business income subject to subdivision 5, 123.30income of an insurance company, or income of an investment company determined under 123.31section 
         290.36.123.32(b) The term "unitary business" means business activities or operations which 123.33result in a flow of value between them. The term may be applied within a single legal 124.1entity or between multiple entities and without regard to whether each entity is a sole 124.2proprietorship, a corporation, a partnership or a trust.124.3(c) Unity is presumed whenever there is unity of ownership, operation, and use, 124.4evidenced by centralized management or executive force, centralized purchasing, 124.5advertising, accounting, or other controlled interaction, but the absence of these 124.6centralized activities will not necessarily evidence a nonunitary business. Unity is also 124.7presumed when business activities or operations are of mutual benefit, dependent upon or 124.8contributory to one another, either individually or as a group.124.9(d) Where a business operation conducted in Minnesota is owned by a business 124.10entity that carries on business activity outside the state different in kind from that 124.11conducted within this state, and the other business is conducted entirely outside the state, it 124.12is presumed that the two business operations are unitary in nature, interrelated, connected, 124.13and interdependent unless it can be shown to the contrary.124.14(e) Unity of ownership is not deemed to does not exist when a corporation is two or 124.15more corporations are involved unless that corporation is a member of a group of two or 124.16more business entities and more than 50 percent of the voting stock of each member of 124.17the group corporation is directly or indirectly owned by a common owner or by common 124.18owners, either corporate or noncorporate, or by one or more of the member corporations 124.19of the group. For this purpose, the term "voting stock" shall include membership interests 124.20of mutual insurance holding companies formed under section 
         66A.40.124.21(f) The net income and apportionment factors under section 
         290.191 or 
         290.20 of 124.22foreign corporations and other foreign entities which are part of a unitary business shall 124.23not be included in the net income or the apportionment factors of the unitary business; 124.24except that the income and apportionment factors of a foreign entity, other than an entity 124.25treated as a C corporation for federal income tax purposes, that are included in the federal 124.26taxable income, as defined in section 63 of the Internal Revenue Code as amended through 124.27the date named in section 290.01, subdivision 19, of a domestic corporation, domestic 124.28entity, or individual must be included in determining net income and the factors to be used 124.29in the apportionment of net income pursuant to section 290.191 or 290.20. A foreign 124.30corporation or other foreign entity which is not included on a combined report and which 124.31is required to file a return under this chapter shall file on a separate return basis. The net 124.32income and apportionment factors under section 290.191 or 290.20 of foreign operating 124.33corporations shall not be included in the net income or the apportionment factors of the 124.34unitary business except as provided in paragraph (g).124.35(g) The adjusted net income of a foreign operating corporation shall be deemed to 124.36be paid as a dividend on the last day of its taxable year to each shareholder thereof, in 125.1proportion to each shareholder's ownership, with which such corporation is engaged in 125.2a unitary business. Such deemed dividend shall be treated as a dividend under section 125.3290.21, subdivision 4.125.4Dividends actually paid by a foreign operating corporation to a corporate shareholder 125.5which is a member of the same unitary business as the foreign operating corporation shall 125.6be eliminated from the net income of the unitary business in preparing a combined report 125.7for the unitary business. The adjusted net income of a foreign operating corporation 125.8shall be its net income adjusted as follows:125.9(1) any taxes paid or accrued to a foreign country, the commonwealth of Puerto 125.10Rico, or a United States possession or political subdivision of any of the foregoing shall 125.11be a deduction; and125.12(2) the subtraction from federal taxable income for payments received from foreign 125.13corporations or foreign operating corporations under section 290.01, subdivision 19d, 125.14clause (10), shall not be allowed.125.15If a foreign operating corporation incurs a net loss, neither income nor deduction from 125.16that corporation shall be included in determining the net income of the unitary business.125.17(h) (g) For purposes of determining the net income of a unitary business and the 125.18factors to be used in the apportionment of net income pursuant to section 
         290.191 or 125.19290.20
         , there must be included only the income and apportionment factors of domestic 125.20corporations or other domestic entities other than foreign operating corporations that are 125.21determined to be part of the unitary business pursuant to this subdivision, notwithstanding 125.22that foreign corporations or other foreign entities might be included in the unitary 125.23business; except that the income and apportionment factors of a foreign entity, other than 125.24an entity treated as a C corporation for federal income tax purposes, that is included in the 125.25federal taxable income, as defined in section 63 of the Internal Revenue Code as amended 125.26through the date named in section 290.01, subdivision 19, of a domestic corporation, 125.27domestic entity, or individual must be included in determining net income and the factors 125.28to be used in the apportionment of net income pursuant to section 290.191 or 290.20.125.29(i) Deductions for expenses, interest, or taxes otherwise allowable under this chapter 125.30that are connected with or allocable against dividends, deemed dividends described 125.31in paragraph (g), or royalties, fees, or other like income described in section 290.01, 125.32subdivision 19d, clause (10), shall not be disallowed.125.33(j) (h) Each corporation or other entity, except a sole proprietorship, that is part of 125.34a unitary business must file combined reports as the commissioner determines. On the 125.35reports, all intercompany transactions between entities included pursuant to paragraph (h)125.36 (g) must be eliminated and the entire net income of the unitary business determined in 126.1accordance with this subdivision is apportioned among the entities by using each entity's 126.2Minnesota factors for apportionment purposes in the numerators of the apportionment 126.3formula and the total factors for apportionment purposes of all entities included pursuant 126.4to paragraph (h) (g) in the denominators of the apportionment formula. Except as 126.5otherwise provided by paragraph (f), all sales of the unitary business made within this 126.6state pursuant to section 290.191 or 290.20 must be included on the combined report of a 126.7corporation or other entity that is a member of the unitary business and is subject to the 126.8jurisdiction of this state to impose tax under this chapter.126.9(k) (i) If a corporation has been divested from a unitary business and is included in a 126.10combined report for a fractional part of the common accounting period of the combined 126.11report:126.12(1) its income includable in the combined report is its income incurred for that part 126.13of the year determined by proration or separate accounting; and126.14(2) its sales, property, and payroll included in the apportionment formula must 126.15be prorated or accounted for separately.126.16EFFECTIVE DATE.This section is effective for taxable years beginning after 126.17December 31, 2012.126.18    Sec. 29. Minnesota Statutes 2012, section 290.191, subdivision 5, is amended to read:126.19    Subd. 5. Determination of sales factor. For purposes of this section, the following 126.20rules apply in determining the sales factor.126.21    (a) The sales factor includes all sales, gross earnings, or receipts received in the 126.22ordinary course of the business, except that the following types of income are not included 126.23in the sales factor:126.24    (1) interest;126.25    (2) dividends;126.26    (3) sales of capital assets as defined in section 1221 of the Internal Revenue Code;126.27    (4) sales of property used in the trade or business, except sales of leased property of 126.28a type which is regularly sold as well as leased; and126.29    (5) sales of debt instruments as defined in section 1275(a)(1) of the Internal Revenue 126.30Code or sales of stock; and.126.31    (6) royalties, fees, or other like income of a type which qualify for a subtraction from 126.32federal taxable income under section 290.01, subdivision 19d, clause (10).126.33    (b) Sales of tangible personal property are made within this state if the property is 126.34received by a purchaser at a point within this state, and the taxpayer is taxable in this state, 127.1regardless of the f.o.b. point, other conditions of the sale, or the ultimate destination 127.2of the property.127.3    (c) Tangible personal property delivered to a common or contract carrier or foreign 127.4vessel for delivery to a purchaser in another state or nation is a sale in that state or nation, 127.5regardless of f.o.b. point or other conditions of the sale.127.6    (d) Notwithstanding paragraphs (b) and (c), when intoxicating liquor, wine, 127.7fermented malt beverages, cigarettes, or tobacco products are sold to a purchaser who is 127.8licensed by a state or political subdivision to resell this property only within the state of 127.9ultimate destination, the sale is made in that state.127.10    (e) Sales made by or through a corporation that is qualified as a domestic 127.11international sales corporation under section 992 of the Internal Revenue Code are not 127.12considered to have been made within this state.127.13    (f) Sales, rents, royalties, and other income in connection with real property is 127.14attributed to the state in which the property is located.127.15    (g) Receipts from the lease or rental of tangible personal property, including finance 127.16leases and true leases, must be attributed to this state if the property is located in this 127.17state and to other states if the property is not located in this state. Receipts from the 127.18lease or rental of moving property including, but not limited to, motor vehicles, rolling 127.19stock, aircraft, vessels, or mobile equipment are included in the numerator of the receipts 127.20factor to the extent that the property is used in this state. The extent of the use of moving 127.21property is determined as follows:127.22    (1) A motor vehicle is used wholly in the state in which it is registered.127.23    (2) The extent that rolling stock is used in this state is determined by multiplying 127.24the receipts from the lease or rental of the rolling stock by a fraction, the numerator of 127.25which is the miles traveled within this state by the leased or rented rolling stock and the 127.26denominator of which is the total miles traveled by the leased or rented rolling stock.127.27    (3) The extent that an aircraft is used in this state is determined by multiplying the 127.28receipts from the lease or rental of the aircraft by a fraction, the numerator of which is 127.29the number of landings of the aircraft in this state and the denominator of which is the 127.30total number of landings of the aircraft.127.31    (4) The extent that a vessel, mobile equipment, or other mobile property is used in 127.32the state is determined by multiplying the receipts from the lease or rental of the property 127.33by a fraction, the numerator of which is the number of days during the taxable year the 127.34property was in this state and the denominator of which is the total days in the taxable year.127.35    (h) Royalties and other income not described in paragraph (a), clause (6), received 127.36for the use of or for the privilege of using intangible property, including patents, 128.1know-how, formulas, designs, processes, patterns, copyrights, trade names, service names, 128.2franchises, licenses, contracts, customer lists, or similar items, must be attributed to the 128.3state in which the property is used by the purchaser. If the property is used in more 128.4than one state, the royalties or other income must be apportioned to this state pro rata 128.5according to the portion of use in this state. If the portion of use in this state cannot be 128.6determined, the royalties or other income must be excluded from both the numerator 128.7and the denominator. Intangible property is used in this state if the purchaser uses the 128.8intangible property or the rights therein in the regular course of its business operations in 128.9this state, regardless of the location of the purchaser's customers.128.10    (i) Sales of intangible property are made within the state in which the property is 128.11used by the purchaser. If the property is used in more than one state, the sales must be 128.12apportioned to this state pro rata according to the portion of use in this state. If the 128.13portion of use in this state cannot be determined, the sale must be excluded from both the 128.14numerator and the denominator of the sales factor. Intangible property is used in this 128.15state if the purchaser used the intangible property in the regular course of its business 128.16operations in this state.128.17    (j) Receipts from the performance of services must be attributed to the state where 128.18the services are received. For the purposes of this section, receipts from the performance 128.19of services provided to a corporation, partnership, or trust may only be attributed to a state 128.20where it has a fixed place of doing business. If the state where the services are received is 128.21not readily determinable or is a state where the corporation, partnership, or trust receiving 128.22the service does not have a fixed place of doing business, the services shall be deemed 128.23to be received at the location of the office of the customer from which the services were 128.24ordered in the regular course of the customer's trade or business. If the ordering office 128.25cannot be determined, the services shall be deemed to be received at the office of the 128.26customer to which the services are billed.128.27    (k) For the purposes of this subdivision and subdivision 6, paragraph (l), receipts 128.28from management, distribution, or administrative services performed by a corporation 128.29or trust for a fund of a corporation or trust regulated under United States Code, title 15, 128.30sections 80a-1 through 80a-64, must be attributed to the state where the shareholder of 128.31the fund resides. Under this paragraph, receipts for services attributed to shareholders are 128.32determined on the basis of the ratio of: (1) the average of the outstanding shares in the 128.33fund owned by shareholders residing within Minnesota at the beginning and end of each 128.34year; and (2) the average of the total number of outstanding shares in the fund at the 128.35beginning and end of each year. Residence of the shareholder, in the case of an individual, 128.36is determined by the mailing address furnished by the shareholder to the fund. Residence 129.1of the shareholder, when the shares are held by an insurance company as a depositor for 129.2the insurance company policyholders, is the mailing address of the policyholders. In 129.3the case of an insurance company holding the shares as a depositor for the insurance 129.4company policyholders, if the mailing address of the policyholders cannot be determined 129.5by the taxpayer, the receipts must be excluded from both the numerator and denominator. 129.6Residence of other shareholders is the mailing address of the shareholder.129.7EFFECTIVE DATE.This section is effective for taxable years beginning after 129.8December 31, 2012.129.9    Sec. 30. Minnesota Statutes 2012, section 290.21, subdivision 4, is amended to read:129.10    Subd. 4. Dividends received from another corporation. (a)(1) Eighty percent 129.11of dividends received by a corporation during the taxable year from another corporation, 129.12in which the recipient owns 20 percent or more of the stock, by vote and value, not 129.13including stock described in section 1504(a)(4) of the Internal Revenue Code when the 129.14corporate stock with respect to which dividends are paid does not constitute the stock in 129.15trade of the taxpayer or would not be included in the inventory of the taxpayer, or does not 129.16constitute property held by the taxpayer primarily for sale to customers in the ordinary 129.17course of the taxpayer's trade or business, or when the trade or business of the taxpayer 129.18does not consist principally of the holding of the stocks and the collection of the income 129.19and gains therefrom; and129.20    (2)(i) the remaining 20 percent of dividends if the dividends received are the stock in 129.21an affiliated company transferred in an overall plan of reorganization and the dividend 129.22is eliminated in consolidation under Treasury Department Regulation 1.1502-14(a), as 129.23amended through December 31, 1989;129.24    (ii) the remaining 20 percent of dividends if the dividends are received from a 129.25corporation which is subject to tax under section 
         290.36 and which is a member of an 129.26affiliated group of corporations as defined by the Internal Revenue Code and the dividend 129.27is eliminated in consolidation under Treasury Department Regulation 1.1502-14(a), as 129.28amended through December 31, 1989, or is deducted under an election under section 129.29243(b) of the Internal Revenue Code; or129.30    (iii) the remaining 20 percent of the dividends if the dividends are received from a 129.31property and casualty insurer as defined under section 
         60A.60, subdivision 8, which is a 129.32member of an affiliated group of corporations as defined by the Internal Revenue Code 129.33and either: (A) the dividend is eliminated in consolidation under Treasury Regulation 129.341.1502-14(a), as amended through December 31, 1989; or (B) the dividend is deducted 129.35under an election under section 243(b) of the Internal Revenue Code.130.1    (b) Seventy percent of dividends received by a corporation during the taxable year 130.2from another corporation in which the recipient owns less than 20 percent of the stock, 130.3by vote or value, not including stock described in section 1504(a)(4) of the Internal 130.4Revenue Code when the corporate stock with respect to which dividends are paid does not 130.5constitute the stock in trade of the taxpayer, or does not constitute property held by the 130.6taxpayer primarily for sale to customers in the ordinary course of the taxpayer's trade or 130.7business, or when the trade or business of the taxpayer does not consist principally of the 130.8holding of the stocks and the collection of income and gain therefrom.130.9    (c) The dividend deduction provided in this subdivision shall be allowed only with 130.10respect to dividends that are included in a corporation's Minnesota taxable net income 130.11for the taxable year.130.12    The dividend deduction provided in this subdivision does not apply to a dividend 130.13from a corporation which, for the taxable year of the corporation in which the distribution 130.14is made or for the next preceding taxable year of the corporation, is a corporation exempt 130.15from tax under section 501 of the Internal Revenue Code.130.16The dividend deduction provided in this subdivision does not apply to a dividend 130.17received from a real estate investment trust as defined in section 856 of the Internal 130.18Revenue Code.130.19    The dividend deduction provided in this subdivision applies to the amount of 130.20regulated investment company dividends only to the extent determined under section 130.21854(b) of the Internal Revenue Code.130.22    The dividend deduction provided in this subdivision shall not be allowed with 130.23respect to any dividend for which a deduction is not allowed under the provisions of 130.24section 246(c) of the Internal Revenue Code.130.25    (d) If dividends received by a corporation that does not have nexus with Minnesota 130.26under the provisions of Public Law 86-272 are included as income on the return of 130.27an affiliated corporation permitted or required to file a combined report under section 130.28290.17, subdivision 4
         , or 
         290.34, subdivision 2, then for purposes of this subdivision the 130.29determination as to whether the trade or business of the corporation consists principally 130.30of the holding of stocks and the collection of income and gains therefrom shall be made 130.31with reference to the trade or business of the affiliated corporation having a nexus with 130.32Minnesota.130.33    (e) The deduction provided by this subdivision does not apply if the dividends are 130.34paid by a FSC as defined in section 922 of the Internal Revenue Code.130.35    (f) If one or more of the members of the unitary group whose income is included on 130.36the combined report received a dividend, the deduction under this subdivision for each 131.1member of the unitary business required to file a return under this chapter is the product 131.2of: (1) 100 percent of the dividends received by members of the group; (2) the percentage 131.3allowed pursuant to paragraph (a) or (b); and (3) the percentage of the taxpayer's business 131.4income apportionable to this state for the taxable year under section 
         290.191 or 
         290.20.131.5EFFECTIVE DATE.This section is effective for taxable years beginning after 131.6December 31, 2012.131.7    Sec. 31. Minnesota Statutes 2012, section 298.01, subdivision 3b, is amended to read:131.8    Subd. 3b. Deductions. (a) For purposes of determining taxable income under 131.9subdivision 3, the deductions from gross income include only those expenses necessary 131.10to convert raw ores to marketable quality. Such expenses include costs associated with 131.11refinement but do not include expenses such as transportation, stockpiling, marketing, or 131.12marine insurance that are incurred after marketable ores are produced, unless the expenses 131.13are included in gross income. The allowable deductions from a mine or plant that mines 131.14and produces more than one mineral, metal, or energy resource must be determined 131.15separately for the purposes of computing the deduction in section 
         290.01, subdivision 19c, 131.16clause (9) (8). These deductions may be combined on one occupation tax return to arrive 131.17at the deduction from gross income for all production.131.18(b) The provisions of section 
         290.01, subdivisions 19c, clauses (6) and (9), and 19d, 131.19clauses (7) and (11) (10), are not used to determine taxable income.131.20    Sec. 32. Laws 2010, chapter 216, section 11, the effective date, is amended to read:131.21EFFECTIVE DATE.This section is effective for taxable years beginning 131.22after December 31, 2009, for certified historic structures for which qualified costs of 131.23rehabilitation are first paid under construction contracts entered into after May 1, 2010131.24 rehabilitation expenditures are first paid by the developer or taxpayer after May 1, 2010, 131.25for rehabilitation that occurs after May 1, 2010, provided that the application under 131.26subdivision 3 is submitted before the project is placed in service.131.27EFFECTIVE DATE.This section is effective the day following final enactment 131.28and applies retroactively for taxable years beginning after December 31, 2009, and for 131.29certified historic structures placed in service after May 1, 2010, but the office may not 131.30issue certificates allowed under the change to this section until July 1, 2013.131.31    Sec. 33. ESTIMATED TAXES; EXCEPTIONS.132.1No addition to tax, penalties, or interest may be made under Minnesota Statutes, 132.2section 289A.25, for any period before September 15, 2013, with respect to an 132.3underpayment of estimated tax, to the extent that the underpayment was created or 132.4increased by the increase in income tax rates under this article.132.5EFFECTIVE DATE.This section is effective for taxable years beginning after 132.6December 31, 2012.132.7    Sec. 34. REPEALER.132.8Minnesota Statutes 2012, sections 290.01, subdivision 6b; 290.06, subdivision 22a; 132.9and 290.0921, subdivision 7, are repealed.132.10EFFECTIVE DATE.This section is effective for taxable years beginning after 132.11December 31, 2012.132.12ARTICLE 7132.13ESTATE AND GIFT TAXES132.14    Section 1. Minnesota Statutes 2012, section 270B.01, subdivision 8, is amended to read:132.15    Subd. 8. Minnesota tax laws. For purposes of this chapter only, unless expressly 132.16stated otherwise, "Minnesota tax laws" means:132.17    (1) the taxes, refunds, and fees administered by or paid to the commissioner under 132.18chapters 115B, 289A (except taxes imposed under sections 
         298.01, 
         298.015, and 
         298.24), 132.19290, 290A, 291, 292, 295, 297A, 297B, and 297H, or any similar Indian tribal tax 132.20administered by the commissioner pursuant to any tax agreement between the state and 132.21the Indian tribal government, and includes any laws for the assessment, collection, and 132.22enforcement of those taxes, refunds, and fees; and132.23    (2) section 
         273.1315.132.24EFFECTIVE DATE.This section is effective for gifts made after December 31, 132.252012.132.26    Sec. 2. Minnesota Statutes 2012, section 270B.03, subdivision 1, is amended to read:132.27    Subdivision 1. Who may inspect. Returns and return information must, on request, 132.28be made open to inspection by or disclosure to the data subject. The request must be made 132.29in writing or in accordance with written procedures of the chief disclosure officer of the 132.30department that have been approved by the commissioner to establish the identification 132.31of the person making the request as the data subject. For purposes of this chapter, the 132.32following are the data subject:133.1(1) in the case of an individual return, that individual;133.2(2) in the case of an income tax return filed jointly, either of the individuals with 133.3respect to whom the return is filed;133.4(3) in the case of a return filed by a business entity, an officer of a corporation, 133.5a shareholder owning more than one percent of the stock, or any shareholder of an S 133.6corporation; a general partner in a partnership; the owner of a sole proprietorship; a 133.7member or manager of a limited liability company; a participant in a joint venture; the 133.8individual who signed the return on behalf of the business entity; or an employee who is 133.9responsible for handling the tax matters of the business entity, such as the tax manager, 133.10bookkeeper, or managing agent;133.11(4) in the case of an estate return:133.12(i) the personal representative or trustee of the estate; and133.13(ii) any beneficiary of the estate as shown on the federal estate tax return;133.14(5) in the case of a trust return:133.15(i) the trustee or trustees, jointly or separately; and133.16(ii) any beneficiary of the trust as shown in the trust instrument;133.17(6) if liability has been assessed to a transferee under section 
         270C.58, subdivision 133.181
         , the transferee is the data subject with regard to the returns and return information 133.19relating to the assessed liability;133.20(7) in the case of an Indian tribal government or an Indian tribal government-owned 133.21entity,133.22(i) the chair of the tribal government, or133.23(ii) any person authorized by the tribal government; and133.24(8) in the case of a successor as defined in section 
         270C.57, subdivision 1, paragraph 133.25(b), the successor is the data subject and information may be disclosed as provided by 133.26section 
         270C.57, subdivision 4.; and133.27(9) in the case of a gift return, the donor.133.28EFFECTIVE DATE.This section is effective the day following final enactment.133.29    Sec. 3. Minnesota Statutes 2012, section 289A.10, subdivision 1, is amended to read:133.30    Subdivision 1. Return required. In the case of a decedent who has an interest in 133.31property with a situs in Minnesota, the personal representative must submit a Minnesota 133.32estate tax return to the commissioner, on a form prescribed by the commissioner, if:133.33(1) a federal estate tax return is required to be filed; or133.34(2) the sum of the federal gross estate and federal adjusted taxable gifts made within 133.35three years of the date of the decedent's death  exceeds $1,000,000.134.1The return must contain a computation of the Minnesota estate tax due. The return 134.2must be signed by the personal representative.134.3EFFECTIVE DATE.This section is effective for estates of decedents dying after 134.4December 31, 2012.134.5    Sec. 4. Minnesota Statutes 2012, section 291.005, subdivision 1, is amended to read:134.6    Subdivision 1. Scope. Unless the context otherwise clearly requires, the following 134.7terms used in this chapter shall have the following meanings:134.8    (1) "Commissioner" means the commissioner of revenue or any person to whom the 134.9commissioner has delegated functions under this chapter.134.10    (2) "Federal gross estate" means the gross estate of a decedent as required to be valued 134.11and otherwise determined for federal estate tax purposes under the Internal Revenue Code.134.12    (3) "Internal Revenue Code" means the United States Internal Revenue Code of 134.131986, as amended through April 14, 2011 January 3, 2013, but without regard to the 134.14provisions of sections 501 and 901 of Public Law 107-16, as amended by Public Law 134.15111-312, and section 301(c) of Public Law 111-312 section 2011, paragraph (f), of the 134.16Internal Revenue Code.134.17    (4) "Minnesota adjusted taxable estate" means federal adjusted taxable estate as 134.18defined by section 2011(b)(3) of the Internal Revenue Code, plus134.19(i) the amount of deduction for state death taxes allowed under section 2058 of the 134.20Internal Revenue Code; 134.21(ii) the amount of taxable gifts, as defined in section 292.16, and made by the 134.22decedent within three years of the decedent's date of death; less134.23(ii) (iii)(A) the value of qualified small business property under section 
         291.03, 134.24subdivision 9
         , and the value of qualified farm property under section 
         291.03, subdivision 134.2510
         , or (B) $4,000,000, whichever is less.134.26    (5) "Minnesota gross estate" means the federal gross estate of a decedent after (a) 134.27excluding therefrom any property included therein which has its situs outside Minnesota, 134.28and (b) including therein any property omitted from the federal gross estate which is 134.29includable therein, has its situs in Minnesota, and was not disclosed to federal taxing 134.30authorities.134.31    (6) "Nonresident decedent" means an individual whose domicile at the time of 134.32death was not in Minnesota.134.33    (7) "Personal representative" means the executor, administrator or other person 134.34appointed by the court to administer and dispose of the property of the decedent. If there 134.35is no executor, administrator or other person appointed, qualified, and acting within this 135.1state, then any person in actual or constructive possession of any property having a situs in 135.2this state which is included in the federal gross estate of the decedent shall be deemed 135.3to be a personal representative to the extent of the property and the Minnesota estate tax 135.4due with respect to the property.135.5    (8) "Resident decedent" means an individual whose domicile at the time of death 135.6was in Minnesota.135.7    (9) "Situs of property" means, with respect to:135.8    (i) real property, the state or country in which it is located; with respect to135.9    (ii) tangible personal property, the state or country in which it was normally kept or 135.10located at the time of the decedent's death or for a gift of tangible personal property within 135.11three years of death, the state or country in which it was normally kept or located when 135.12the gift was executed; and with respect to135.13    (iii) intangible personal property, the state or country in which the decedent was 135.14domiciled at death or for a gift of intangible personal property within three years of death, 135.15the state or country in which the decedent was domiciled when the gift was executed.135.16    For a nonresident decedent with an ownership interest in a pass-through entity 135.17with assets that include real or tangible personal property, situs of the real or tangible 135.18personal property is determined as if the pass-through entity does not exist and the real 135.19or tangible personal property is personally owned by the decedent. If the pass-through 135.20entity is owned by a person or persons in addition to the decedent, ownership of the 135.21property is attributed to the decedent in proportion to the decedent's capital ownership 135.22share of the pass-through entity.135.23(10) "Pass-through entity" includes the following:135.24(i) an entity electing S corporation status under section 1362 of the Internal Revenue 135.25Code;135.26(ii) an entity taxed as a partnership under subchapter K of the Internal Revenue Code;135.27(iii) a single-member limited liability company or similar entity, regardless of 135.28whether it is taxed as an association or is disregarded for federal income tax purposes 135.29under Code of Federal Regulations, title 26, section 301.7701-3; or135.30(iv) a trust to the extent the property is includible in the decedent's federal gross estate.135.31EFFECTIVE DATE.This section is effective for decedents dying after December 135.3231, 2012.135.33    Sec. 5. Minnesota Statutes 2012, section 291.03, subdivision 1, is amended to read:135.34    Subdivision 1. Tax amount. (a) The tax imposed shall be an amount equal to the 135.35proportion of the maximum credit for state death taxes computed under section 2011 of 136.1the Internal Revenue Code, but using Minnesota adjusted taxable estate instead of federal 136.2adjusted taxable estate, as the Minnesota gross estate bears to the value of the federal 136.3gross estate. The tax is reduced by:136.4    (1) the gift tax paid by the decedent under section 292.17 on gifts included in the 136.5Minnesota adjusted taxable estate and not subtracted as qualified farm or small business 136.6property; and136.7    (2) any credit allowed under subdivision 1c.136.8    (b) The tax determined under this subdivision must not be greater than the sum of 136.9the following amounts multiplied by a fraction, the numerator of which is the Minnesota 136.10gross estate and the denominator of which is the federal gross estate:136.11    (1) the rates and brackets under section 2001(c) of the Internal Revenue Code 136.12multiplied by the sum of:136.13    (i) the taxable estate, as defined under section 2051 of the Internal Revenue Code; plus136.14    (ii) adjusted taxable gifts, as defined in section 2001(b) of the Internal Revenue 136.15Code; less136.16(iii) the lesser of (A) the sum of the value of qualified small business property 136.17under subdivision 9, and the value of qualified farm property under subdivision 10, or 136.18(B) $4,000,000; less136.19    (2) the amount of tax allowed under section 2001(b)(2) of the Internal Revenue 136.20Code; and less136.21    (3) the federal credit allowed under section 2010 of the Internal Revenue Code.136.22    (c) For purposes of this subdivision, "Internal Revenue Code" means the Internal 136.23Revenue Code of 1986, as amended through December 31, 2000.136.24EFFECTIVE DATE.This section is effective for decedents dying after December 136.2531, 2012.136.26    Sec. 6. Minnesota Statutes 2012, section 291.03, is amended by adding a subdivision 136.27to read:136.28    Subd. 1c.Nonresident decedent tax credit.(a) The estate of a nonresident 136.29decedent that is subject to tax under this chapter on the value of Minnesota situs property 136.30held in a pass-through entity is allowed a credit against the tax due under this section 136.31equal to the lesser of:136.32(1) the amount of estate or inheritance tax paid to another state that is attributable to 136.33the Minnesota situs property held in the pass-through entity; or136.34(2) the amount of tax paid under this section attributable to the Minnesota situs 136.35property held in the pass-through entity.137.1(b) The amount of tax attributable to the Minnesota situs property held in the 137.2pass-through entity must be determined by the increase in the estate or inheritance tax that 137.3results from including the market value of the property in the estate or treating the value 137.4as a taxable inheritance to the recipient of the property.137.5EFFECTIVE DATE.This section is effective for decedents dying after December 137.631, 2012.137.7    Sec. 7. Minnesota Statutes 2012, section 291.03, subdivision 8, is amended to read:137.8    Subd. 8. Definitions. (a) For purposes of this section, the following terms have the 137.9meanings given in this subdivision.137.10(b) "Family member" means a family member as defined in section 2032A(e)(2) of 137.11the Internal Revenue Code, or a trust whose present beneficiaries are all family members 137.12as defined in section 2032A(e)(2) of the Internal Revenue Code.137.13(c) "Qualified heir" means a family member who acquired qualified property from137.14 upon the death of the decedent and satisfies the requirement under subdivision 9, clause 137.15(6) (7), or subdivision 10, clause (4) (5), for the property.137.16(d) "Qualified property" means qualified small business property under subdivision 137.179 and qualified farm property under subdivision 10.137.18EFFECTIVE DATE.This section is effective retroactively for estates of decedents 137.19dying after June 30, 2011.137.20    Sec. 8. Minnesota Statutes 2012, section 291.03, subdivision 9, is amended to read:137.21    Subd. 9. Qualified small business property. Property satisfying all of the following 137.22requirements is qualified small business property:137.23(1) The value of the property was included in the federal adjusted taxable estate.137.24(2) The property consists of the assets of a trade or business or shares of stock or 137.25other ownership interests in a corporation or other entity engaged in a trade or business. 137.26The decedent or the decedent's spouse must have materially participated in the trade or 137.27business within the meaning of section 469 of the Internal Revenue Code during the 137.28taxable year that ended before the date of the decedent's death. Shares of stock in a 137.29corporation or an ownership interest in another type of entity do not qualify under this 137.30subdivision if the shares or ownership interests are traded on a public stock exchange at 137.31any time during the three-year period ending on the decedent's date of death. For purposes 137.32of this subdivision, an ownership interest includes the interest the decedent is deemed to 137.33own under sections 2036, 2037, and 2038 of the Internal Revenue Code.138.1(3) During the taxable year that ended before the decedent's death, the trade or 138.2business must not have been a passive activity within the meaning of section 469(c) of the 138.3Internal Revenue Code, and the decedent or the decedent's spouse must have materially 138.4participated in the trade or business within the meaning of section 469(h) of the Internal 138.5Revenue Code, excluding section 469(h)(3) of the Internal Revenue Code and any other 138.6provision provided by United States Treasury Department regulation that substitutes 138.7material participation in prior taxable years for material participation in the taxable year 138.8that ended before the decedent's death.138.9(4) The gross annual sales of the trade or business were $10,000,000 or less for the 138.10last taxable year that ended before the date of the death of the decedent.138.11(4) (5) The property does not consist of cash or, cash equivalents, publicly traded 138.12securities, or assets not used in the operation of the trade or business. For property 138.13consisting of shares of stock or other ownership interests in an entity, the amount value of 138.14cash or, cash equivalents, publicly traded securities, or assets not used in the operation of 138.15the trade or business held by the corporation or other entity must be deducted from the 138.16value of the property qualifying under this subdivision in proportion to the decedent's 138.17share of ownership of the entity on the date of death.138.18(5) (6) The decedent continuously owned the property, including property the 138.19decedent is deemed to own under sections 2036, 2037, and 2038 of the Internal Revenue 138.20Code, for the three-year period ending on the date of death of the decedent. In the case of 138.21a sole proprietor, if the property replaced similar property within the three-year period, 138.22the replacement property will be treated as having been owned for the three-year period 138.23ending on the date of death of the decedent.138.24(6) A family member continuously uses the property in the operation of the trade or 138.25business for three years following the date of death of the decedent.138.26(7) For three years following the date of death of the decedent, the trade or business 138.27is not a passive activity within the meaning of section 469(c) of the Internal Revenue Code, 138.28and a family member materially participates in the operation of the trade or business within 138.29the meaning of section 469(h) of the Internal Revenue Code, excluding section 469(h)(3) 138.30of the Internal Revenue Code and any other provision provided by United States Treasury 138.31Department regulation that substitutes material participation in prior taxable years for 138.32material participation in the three years following the date of death of the decedent.138.33(8) The estate and the qualified heir elect to treat the property as qualified small 138.34business property and agree, in the form prescribed by the commissioner, to pay the 138.35recapture tax under subdivision 11, if applicable.139.1EFFECTIVE DATE.This section is effective retroactively for estates of decedents 139.2dying after June 30, 2011.139.3    Sec. 9. Minnesota Statutes 2012, section 291.03, subdivision 10, is amended to read:139.4    Subd. 10. Qualified farm property. Property satisfying all of the following 139.5requirements is qualified farm property:139.6(1) The value of the property was included in the federal adjusted taxable estate.139.7(2) The property consists of a farm meeting the requirements of agricultural land and 139.8is owned by a person or entity that is either not subject to or is in compliance with section 139.9500.24
         , and was classified for property tax purposes as the homestead of the decedent 139.10or the decedent's spouse or both under section 273.124, and as class 2a property under 139.11section 273.13, subdivision 23.139.12(3) For property taxes payable in the taxable year of the decedent's death, the 139.13property is classified as class 2a property under section 273.13, subdivision 23, and is 139.14classified as agricultural homestead, agricultural relative homestead, or special agricultural 139.15homestead under section 273.124.139.16(4) The decedent continuously owned the property, including property the decedent 139.17is deemed to own under sections 2036, 2037, and 2038 of the Internal Revenue Code, for 139.18the three-year period ending on the date of death of the decedent either by ownership of 139.19the agricultural land or pursuant to holding an interest in an entity that is not subject to 139.20or is in compliance with section 500.24.139.21(4) A family member continuously uses the property in the operation of the trade or 139.22business (5) The property is classified for property tax purposes as class 2a property under 139.23section 273.13, subdivision 23, for three years following the date of death of the decedent.139.24(5) (6)  The estate and the qualified heir elect to treat the property as qualified farm 139.25property and agree, in a form prescribed by the commissioner, to pay the recapture tax 139.26under subdivision 11, if applicable.139.27EFFECTIVE DATE.This section is effective retroactively for estates of decedents 139.28dying after June 30, 2011.139.29    Sec. 10. Minnesota Statutes 2012, section 291.03, subdivision 11, is amended to read:139.30    Subd. 11. Recapture tax. (a) If, within three years after the decedent's death and 139.31before the death of the qualified heir, the qualified heir disposes of any interest in the 139.32qualified property, other than by a disposition to a family member, or a family member 139.33ceases to use the qualified property which was acquired or passed from the decedent139.34 satisfy the requirement under subdivision 9, clause (7); or 10, clause (5), an additional 140.1estate tax is imposed on the property. In the case of a sole proprietor, if the qualified heir 140.2replaces qualified small business property excluded under subdivision 9 with similar 140.3property, then the qualified heir will not be treated as having disposed of an interest in the 140.4qualified property.140.5(b) The amount of the additional tax equals the amount of the exclusion claimed by 140.6the estate under subdivision 8, paragraph (d), multiplied by 16 percent.140.7(c) The additional tax under this subdivision is due on the day which is six months 140.8after the date of the disposition or cessation in paragraph (a).140.9EFFECTIVE DATE.This section is effective retroactively for estates of decedents 140.10dying after June 30, 2011.140.11    Sec. 11. [292.16] DEFINITIONS.140.12(a) For purposes of this chapter, the following definitions apply.140.13(b) The definitions of terms defined in section 291.005 apply.140.14(c) "Resident" has the meaning given in section 290.01, subdivision 7, paragraph (a).140.15(d) "Taxable gifts" means:140.16(1) the transfers by gift which are included in taxable gifts for federal gift tax 140.17purposes under the following sections of the Internal Revenue Code:140.18(i) section 2503;140.19(ii) sections 2511 to 2514; and140.20(iii) sections 2516 to 2519; less140.21(2) the deductions allowed in sections 2522 to 2524 of the Internal Revenue Code.140.22EFFECTIVE DATE.This section is effective for taxable gifts made after June 140.2330, 2013.140.24    Sec. 12. [292.17] GIFT TAX.140.25    Subdivision 1.Imposition.(a) A tax is imposed on the transfer of property by gift 140.26by any individual resident or nonresident in an amount equal to ten percent of the amount 140.27of the taxable gift.140.28(b) The donor is liable for payment of the tax. If the gift tax is not paid when due, 140.29the donee of any gift is personally liable for the tax to the extent of the value of the gift.140.30    Subd. 2.Lifetime credit.A credit is allowed against the tax imposed under this 140.31section equal to $100,000. This credit applies to the cumulative amount of taxable gifts 140.32made by the donor during the donor's lifetime.140.33    Subd. 3.Out-of-state gifts.Taxable gifts exclude the transfer of:141.1(1) real property located outside of this state;141.2(2) tangible personal property that was normally kept at a location outside of the 141.3state on the date the gift was executed; and141.4(3) intangible personal property made by an individual who is not a resident at 141.5the time the gift was executed.141.6EFFECTIVE DATE.This section is effective for taxable gifts made after June 141.730, 2013.141.8    Sec. 13. [292.18] RETURNS.141.9(a) Any individual who makes a taxable gift during the taxable year shall file a gift 141.10tax return in the form and manner prescribed by the commissioner.141.11(b) If the donor dies before filing the return, the executor of the donor's will or 141.12the administrator of the donor's estate shall file the return. If the donor becomes legally 141.13incompetent before filing the return, the guardian or conservator shall file the return.141.14(c) The return must include:141.15(1) each gift made during the calendar year which is to be included in computing the 141.16taxable gifts;141.17(2) the deductions claimed and allowable under section 292.16, paragraph (d), 141.18clause (2);141.19(3) a description of the gift, and the donee's name, address, and Social Security 141.20number;141.21(4) the fair market value of gifts not made in money; and141.22(5) any other information the commissioner requires to administer the gift tax.141.23EFFECTIVE DATE.This section is effective for taxable gifts made after June 141.2430, 2013.141.25    Sec. 14. [292.19] FILING REQUIREMENTS.141.26Gift tax returns must be filed by the April 15 following the close of the calendar 141.27year, except if a gift is made during the calendar year in which the donor dies, the return 141.28for the donor must be filed by the last date, including extensions, for filing the gift tax 141.29return for federal gift tax purposes for the donor.141.30EFFECTIVE DATE.This section is effective for taxable gifts made after June 141.3130, 2013.141.32    Sec. 15. [292.20] APPRAISAL OF PROPERTY; DECLARATION BY DONOR.142.1The commissioner may require the donor or the donee to show the property subject to 142.2the tax under section 292.17 to the commissioner upon demand and may employ a suitable 142.3person to appraise the property. The donor shall submit a declaration, in a form prescribed 142.4by the commissioner and including any certification required by the commissioner, that the 142.5property shown by the donor on the gift tax return includes all of the property transferred by 142.6gift for the calendar year and not deductible under section 292.16, paragraph (d), clause (2).142.7EFFECTIVE DATE.This section is effective for taxable gifts made after June 142.830, 2013.142.9    Sec. 16. [292.21] ADMINISTRATIVE PROVISIONS.142.10    Subdivision 1.Payment of tax; penalty for late payment.The tax imposed under 142.11section 292.17 is due and payable to the commissioner by the April 15 following the close 142.12of the calendar year during which the gift was made. The return required under section 142.13292.19 must be included with the payment. If a taxable gift is made during the calendar 142.14year in which the donor dies, the due date is the last date, including extensions, for filing 142.15the gift tax return for federal gift tax purposes for the donor. If any person fails to pay the 142.16tax due within the time specified under this section, a penalty applies equal to ten percent 142.17of the amount due and unpaid or $100, whichever is greater. The unpaid tax and penalty 142.18bear interest at the rate under section 270C.40 from the due date of the return.142.19    Subd. 2.Extensions.The commissioner may, for good cause, extend the time for 142.20filing a gift tax return, if a written request is filed with a tentative return accompanied by a 142.21payment of the tax, which is estimated in the tentative return, on or before the last day for 142.22filing the return. Any person to whom an extension is granted must pay, in addition to the 142.23tax, interest at the rate under section 270C.40 from the date on which the tax would have 142.24been due without the extension.142.25    Subd. 3.Changes in federal gift tax.If the amount of a taxpayer's taxable gifts 142.26for federal gift tax purposes, as reported on the taxpayer's federal gift tax return for any 142.27calendar year, is changed or corrected by the Internal Revenue Service or other officer 142.28of the United States or other competent authority, the taxpayer shall report the change or 142.29correction in federal taxable gifts within 180 days after the final determination of the change 142.30or correction, and concede the accuracy of the determination or provide a letter detailing 142.31how the federal determination is incorrect or does not change the Minnesota gift tax. Any 142.32taxpayer filing an amended federal gift tax return shall also file within 180 days an amended 142.33return under this chapter and shall include any information the commissioner requires. The 142.34time for filing the report or amended return may be extended by the commissioner upon due 142.35cause shown. Notwithstanding any limitation of time in this chapter, if, upon examination, 143.1the commissioner finds that the taxpayer is liable for the payment of an additional tax, the 143.2commissioner shall, within a reasonable time from the receipt of the report or amended 143.3return, notify the taxpayer of the amount of additional tax, together with interest computed 143.4at the rate under section 270C.40 from the date when the original tax was due and payable. 143.5Within 30 days of the mailing of the notice, the taxpayer shall pay the commissioner the 143.6amount of the additional tax and interest. If, upon examination of the report or amended 143.7return and related information, the commissioner finds that the taxpayer has overpaid the 143.8tax due the state, the commissioner shall refund the overpayment to the taxpayer.143.9    Subd. 4.Application of federal rules.In administering the tax under this chapter, 143.10the commissioner shall apply the provisions of sections 2701 to 2704 of the Internal 143.11Revenue Code. The words "secretary or his delegate," as used in those sections of the 143.12Internal Revenue Code, mean the commissioner.143.13EFFECTIVE DATE.This section is effective for taxable gifts made after June 143.1430, 2013.143.15ARTICLE 8143.16SALES AND USE TAXES; LOCAL SALES TAXES143.17    Section 1. [116J.3738] QUALIFIED EXPANSIONS OF GREATER MINNESOTA 143.18BUSINESSES.143.19    Subdivision 1.Definitions.(a) For purposes of this section, the following terms 143.20have the meanings given unless the context clearly indicates otherwise.143.21(b) "Agricultural processing facility" means one or more facilities or operations 143.22that transform, package, sort, or grade livestock or livestock products, agricultural 143.23commodities, or plants or plant products into goods that are used for intermediate or final 143.24consumption including goods for nonfood use, and surrounding property. 143.25(c) "Business" means an individual, corporation, partnership, limited liability 143.26company, association, or any other entity engaged in operating a trade or business located 143.27in greater Minnesota.143.28(d) "City" means a statutory or home rule charter city.143.29(e) "Greater Minnesota" means the area of the state that excludes the metropolitan 143.30area, as defined in section 473.121, subdivision 2.143.31(f) "Qualified business" means a business that satisfies the requirements of subdivision 143.322, has been certified under subdivision 3, and has not been terminated under subdivision 5.143.33    Subd. 2.Qualified business.(a) A business is a qualified business if it satisfies the 143.34requirement of this paragraph and is not disqualified under the provisions of paragraph 143.35(b). To qualify, the business must:144.1(1) have operated its trade or business in a city or cities in greater Minnesota for at 144.2least one year before applying under subdivision 3;144.3(2) pay or agree to pay in the future each employee compensation, including benefits 144.4not mandated by law, that on an annualized basis equal at least 120 percent of the federal 144.5poverty level for a family of four;144.6(3) plan and agree to expand its employment in one or more cities in greater Minnesota 144.7by the minimum number of employees required under subdivision 3, paragraph (c); and144.8(4) received certification from the commissioner under subdivision 3 that it is a 144.9qualified business.144.10(b) A business is not a qualified business if it is either:144.11(1) primarily engaged in making retail sales to purchasers who are physically present 144.12at the business's location or locations in greater Minnesota; or144.13(2) a public utility, as defined in section 336B.01.144.14(c) The requirements in paragraph (a) that the business' operations and expansion be 144.15located in a city do not apply to an agricultural processing facility.144.16    Subd. 3.Certification of qualified business.(a) A business may apply to the 144.17commissioner for certification as a qualified business under this section. The commissioner 144.18shall specify the form of the application, the manner and times for applying, and the 144.19information required to be included in the application. The commissioner may impose an 144.20application fee in an amount sufficient to defray the commissioner's cost of processing 144.21certifications. A business must file a copy of its application with the chief clerical officer 144.22of the city at the same time it applies to the commissioner.  For an agricultural processing 144.23facility located outside the boundaries of a city, the business must file a copy of the 144.24application with the county auditor.144.25(b) The commissioner shall certify each business as a qualified business that:144.26(1) satisfies the requirements of subdivision 2;144.27(2) the commissioner determines would not expand its operations in greater 144.28Minnesota without the tax incentives available under subdivision 4; and 144.29(3) enters a business subsidy agreement with the commissioner that pledges to 144.30satisfy the minimum expansion requirements of paragraph (c) within three years or less 144.31following execution of the agreement.144.32The commissioner must act on an application within 60 days after its filing. Failure 144.33by the commissioner to take action within the 60-day period is deemed approval of the 144.34application.144.35(c) The following minimum expansion requirements apply, based on the number of 144.36employees of the business at locations in greater Minnesota:145.1(1) a business that employees 50 or fewer full-time equivalent employees in greater 145.2Minnesota when the agreement is executed must increase its employment by five or more 145.3full-time equivalent employees;145.4(2) a business that employees more than 50 but fewer than 200 full-time equivalent 145.5employees in greater Minnesota when the agreement is executed must increase the number 145.6of its full-time equivalent employees in greater Minnesota by at least ten percent; or145.7(3) a business that employees 200 or more full-time equivalent employees in greater 145.8Minnesota when the agreement is executed must increase its employment by at least 21 145.9full-time equivalent employees.145.10(d) The city, or a county for an agricultural processing facility located outside the 145.11boundaries of a city, in which the business proposes to expand its operations may file 145.12comments supporting or opposing the application with the commissioner. The comments 145.13must be filed within 30 days after receipt by the city of the application and may include a 145.14notice of any contribution the city or county intends to make to encourage or support the 145.15business expansion, such as the use of tax increment financing, property tax abatement, 145.16additional city or county services, or other financial assistance.145.17(e) Certification of a qualified business is effective for the 12-year period beginning 145.18on the first day of the calendar month immediately following execution of the business 145.19subsidy agreement.145.20    Subd. 4.Available tax incentives.A qualified business is entitled to a sales tax 145.21exemption, as provided in section 297A.68, subdivision 49, for purchases made during the 145.22period the business was certified as a qualified business under this section.145.23    Subd. 5.Termination of status as a qualified business.(a) The commissioner shall 145.24put in place a system for monitoring and ensuring that each certified business meets within 145.25three years or less the minimum expansion requirement in its business subsidy agreement 145.26and continues to satisfy those requirements for the rest of the duration of the certification 145.27under subdivision 3. This system must include regular reporting by the business to the 145.28commissioner of its baseline and current employment levels and any other information 145.29the commissioner determines may be useful to ensure compliance and for legislative 145.30evaluation of the effectiveness of the tax incentives.145.31(b) A business ceases to be a qualified business and to qualify for the sales tax 145.32exemption under section 297A.68, subdivision 49, under this subdivision upon the earlier 145.33of the following dates:145.34(1) the end of the duration of its designation under subdivision 3, paragraph (e), 145.35effective as provided under this subdivision or other provision of law for the tax incentive; 145.36or146.1(2) the date the commissioner finds that the business has breached its business 146.2subsidy agreement and failed to satisfy the minimum expansion required by subdivision 3 146.3and its agreement.146.4(c) A business may contest the commissioner's finding that it breached its business 146.5subsidy agreement under paragraph (b), clause (2), under the contested case procedures in 146.6the Administrative Procedure Act, chapter 14.146.7(d) The commissioner, after consulting with the commissioner of revenue, may 146.8waive a breach of the business subsidy agreement and permit continued receipt of tax 146.9incentives, if the commissioner determines that termination of the tax incentives is not in 146.10the best interest of the state or the local government units and the business' breach of the 146.11agreement is a result of circumstances beyond its control including, but not limited to:146.12(1) a natural disaster;146.13(2) unforeseen industry trends;146.14(3) a decline in economic activity in the overall or greater Minnesota economy; or146.15(4) loss of a major supplier or customer of the business.146.16EFFECTIVE DATE.This section is effective the day following final enactment.146.17    Sec. 2. Minnesota Statutes 2012, section 297A.61, subdivision 3, is amended to read:146.18    Subd. 3. Sale and purchase. (a) "Sale" and "purchase" include, but are not limited 146.19to, each of the transactions listed in this subdivision. In applying the provisions of this 146.20chapter, the terms "tangible personal property" and "retail sale" include the taxable 146.21services listed in paragraph (g), clause (6), items (i) to (vi) and (viii), and the provision 146.22of these taxable services, unless specifically provided otherwise. Services performed by 146.23an employee for an employer are not taxable. Services performed by a partnership or 146.24association for another partnership or association are not taxable if one of the entities owns 146.25or controls more than 80 percent of the voting power of the equity interest in the other 146.26entity. Services performed between members of an affiliated group of corporations are not 146.27taxable. For purposes of the preceding sentence, "affiliated group of corporations" means 146.28those entities that would be classified as members of an affiliated group as defined under 146.29United States Code, title 26, section 1504, disregarding the exclusions in section 1504(b).146.30    (b) Sale and purchase include:146.31    (1) any transfer of title or possession, or both, of tangible personal property, whether 146.32absolutely or conditionally, for a consideration in money or by exchange or barter; and146.33    (2) the leasing of or the granting of a license to use or consume, for a consideration 146.34in money or by exchange or barter, tangible personal property, other than a manufactured 146.35home used for residential purposes for a continuous period of 30 days or more.147.1    (c) Sale and purchase include the production, fabrication, printing, or processing of 147.2tangible personal property for a consideration for consumers who furnish either directly or 147.3indirectly the materials used in the production, fabrication, printing, or processing.147.4    (d) Sale and purchase include the preparing for a consideration of food. 147.5Notwithstanding section 
         297A.67, subdivision 2, taxable food includes, but is not limited 147.6to, the following:147.7    (1) prepared food sold by the retailer;147.8    (2) soft drinks;147.9    (3) candy;147.10    (4) dietary supplements; and147.11    (5) all food sold through vending machines.147.12    (e) A sale and a purchase includes the furnishing for a consideration of electricity, 147.13gas, water, or steam for use or consumption within this state.147.14    (f) A sale and a purchase includes147.15     the transfer for a consideration of prewritten computer software whether delivered 147.16electronically, by load and leave, or otherwise.147.17    (g) A sale and a purchase includes the furnishing for a consideration of the following 147.18services:147.19    (1) the privilege of admission to places of amusement, recreational areas, or athletic 147.20events, and the making available of amusement devices, tanning facilities, reducing 147.21salons, steam baths, Turkish baths, health clubs, and spas or athletic facilities;147.22    (2) lodging and related services by a hotel, rooming house, resort, campground, 147.23motel, or trailer camp, including furnishing the guest of the facility with access to 147.24telecommunication services, and the granting of any similar license to use real property in 147.25a specific facility, other than the renting or leasing of it for a continuous period of 30 days 147.26or more under an enforceable written agreement that may not be terminated without prior 147.27notice and including accommodations intermediary services provided in connection with 147.28other services provided under this clause;147.29    (3) nonresidential parking services, whether on a contractual, hourly, or other 147.30periodic basis, except for parking at a meter;147.31    (4) the granting of membership in a club, association, or other organization if:147.32    (i) the club, association, or other organization makes available for the use of its 147.33members sports and athletic facilities, without regard to whether a separate charge is 147.34assessed for use of the facilities; and147.35    (ii) use of the sports and athletic facility is not made available to the general public 147.36on the same basis as it is made available to members.148.1Granting of membership means both onetime initiation fees and periodic membership 148.2dues. Sports and athletic facilities include golf courses; tennis, racquetball, handball, and 148.3squash courts; basketball and volleyball facilities; running tracks; exercise equipment; 148.4swimming pools; and other similar athletic or sports facilities;148.5    (5) delivery of aggregate materials by a third party, excluding delivery of aggregate 148.6material used in road construction; and delivery of concrete block by a third party if the 148.7delivery would be subject to the sales tax if provided by the seller of the concrete block. 148.8For purposes of this clause, "road construction" means construction of:148.9    (i) public roads;148.10    (ii) cartways; and148.11    (iii) private roads in townships located outside of the seven-county metropolitan area 148.12up to the point of the emergency response location sign; and148.13    (6) services as provided in this clause:148.14    (i) laundry and dry cleaning services including cleaning, pressing, repairing, altering, 148.15and storing clothes, linen services and supply, cleaning and blocking hats, and carpet, 148.16drapery, upholstery, and industrial cleaning. Laundry and dry cleaning services do not 148.17include services provided by coin operated facilities operated by the customer;148.18    (ii) motor vehicle washing, waxing, and cleaning services, including services 148.19provided by coin operated facilities operated by the customer, and rustproofing, 148.20undercoating, and towing of motor vehicles;148.21    (iii) building and residential cleaning, maintenance, and disinfecting services and 148.22pest control and exterminating services;148.23    (iv) detective, security, burglar, fire alarm, and armored car services; but not 148.24including services performed within the jurisdiction they serve by off-duty licensed peace 148.25officers as defined in section 
         626.84, subdivision 1, or services provided by a nonprofit 148.26organization or any organization at the direction of a county for monitoring and electronic 148.27surveillance of persons placed on in-home detention pursuant to court order or under the 148.28direction of the Minnesota Department of Corrections;148.29    (v) pet grooming services;148.30    (vi) lawn care, fertilizing, mowing, spraying and sprigging services; garden planting 148.31and maintenance; tree, bush, and shrub pruning, bracing, spraying, and surgery; indoor 148.32plant care; tree, bush, shrub, and stump removal, except when performed as part of a land 148.33clearing contract as defined in section 
         297A.68, subdivision 40; and tree trimming for 148.34public utility lines. Services performed under a construction contract for the installation of 148.35shrubbery, plants, sod, trees, bushes, and similar items are not taxable;149.1    (vii) massages, except when provided by a licensed health care facility or 149.2professional or upon written referral from a licensed health care facility or professional for 149.3treatment of illness, injury, or disease; and149.4    (viii) the furnishing of lodging, board, and care services for animals in kennels and 149.5other similar arrangements, but excluding veterinary and horse boarding services.149.6    In applying the provisions of this chapter, the terms "tangible personal property" 149.7and "retail sale" include taxable services listed in clause (6), items (i) to (vi) and (viii), 149.8and the provision of these taxable services, unless specifically provided otherwise. 149.9Services performed by an employee for an employer are not taxable. Services performed 149.10by a partnership or association for another partnership or association are not taxable if 149.11one of the entities owns or controls more than 80 percent of the voting power of the 149.12equity interest in the other entity. Services performed between members of an affiliated 149.13group of corporations are not taxable. For purposes of the preceding sentence, "affiliated 149.14group of corporations" means those entities that would be classified as members of an 149.15affiliated group as defined under United States Code, title 26, section 1504, disregarding 149.16the exclusions in section 1504(b).149.17    For purposes of clause (5), "road construction" means construction of (1) public 149.18roads, (2) cartways, and (3) private roads in townships located outside of the seven-county 149.19metropolitan area up to the point of the emergency response location sign.149.20    (h) A sale and a purchase includes the furnishing for a consideration of tangible 149.21personal property or taxable services by the United States or any of its agencies or 149.22instrumentalities, or the state of Minnesota, its agencies, instrumentalities, or political 149.23subdivisions.149.24    (i) A sale and a purchase includes the furnishing for a consideration of 149.25telecommunications services, ancillary services associated with telecommunication 149.26services, cable and pay television services, and direct satellite services. Telecommunication 149.27services include, but are not limited to, the following services, as defined in section 149.28297A.669
         : air-to-ground radiotelephone service, mobile telecommunication service, 149.29postpaid calling service, prepaid calling service, prepaid wireless calling service, and 149.30private communication services. The services in this paragraph are taxed to the extent 149.31allowed under federal law.149.32    (j) A sale and a purchase includes the furnishing for a consideration of installation if 149.33the installation charges would be subject to the sales tax if the installation were provided 149.34by the seller of the item being installed.149.35    (k) A sale and a purchase includes the rental of a vehicle by a motor vehicle dealer 149.36to a customer when (1) the vehicle is rented by the customer for a consideration, or (2) 150.1the motor vehicle dealer is reimbursed pursuant to a service contract as defined in section 150.259B.02, subdivision
          11.150.3    (l) A sale and a purchase includes furnishing for a consideration of specified digital 150.4products or other digital products or granting the right for a consideration to use specified 150.5digital products or other digital products on a temporary or permanent basis and regardless 150.6of whether the purchaser is required to make continued payments for such right. Wherever 150.7the term "tangible personal property" is used in this chapter, other than in subdivisions 10 150.8and 38, the provisions also apply to specified digital products, or other digital products, 150.9unless specifically provided otherwise or the context indicates otherwise.150.10(m) A sale and purchase includes the furnishing for consideration of the following 150.11services:150.12(1) repairing and maintaining electronic and precision equipment, which service can 150.13be deducted as a business expense under the Internal Revenue Code. This includes, but 150.14is not limited to, repair or maintenance of electronic devices, computers and computer 150.15peripherals, monitors, computer terminals, storage devices, and CD-ROM drives; other 150.16office equipment such as photocopying machines, printers, and facsimile machines; 150.17televisions, stereos, sound systems, video or digital recorders and players; two-way radios 150.18and other communications equipment; radar and sonar equipment, scientific instruments, 150.19microscopes, and medical equipment;150.20(2) repairing and maintaining commercial and industrial machinery and equipment.  150.21For purposes of this subdivision, the following items are not commercial or industrial 150.22machinery and equipment: (i) motor vehicles; (ii) furniture and fixtures; (iii) ships; (iv) 150.23railroad stock; and (v) aircraft; and150.24(3) warehousing or storage services for tangible personal property, excluding:150.25(i) agricultural products;150.26(ii) refrigerated storage;150.27(iii) electronic data; and150.28(iv) self-storage services and storage of motor vehicles, recreational vehicles, and 150.29boats, not eligible to be deducted as a business expense under the Internal Revenue Code.150.30EFFECTIVE DATE.This section is effective for sales and purchases made after 150.31June 30, 2013, except that paragraph (m), clause (3), is effective for sales and purchases 150.32made after March 31, 2014.150.33    Sec. 3. Minnesota Statutes 2012, section 297A.61, subdivision 4, is amended to read:150.34    Subd. 4. Retail sale. (a) A "retail sale" means:151.1    (1) any sale, lease, or rental of tangible personal propertyfor any purpose, other than 151.2resale, sublease, or subrent of items by the purchaser in the normal course of business 151.3as defined in subdivision 21; and151.4    (2) any sale of a service enumerated in subdivision 3, for any purpose other than 151.5resale by the purchaser in the normal course of business as defined in subdivision 21.151.6    (b) A sale of property used by the owner only by leasing it to others or by holding it 151.7in an effort to lease it, and put to no use by the owner other than resale after the lease or 151.8effort to lease, is a sale of property for resale.151.9    (c) A sale of master computer software that is purchased and used to make copies for 151.10sale or lease is a sale of property for resale.151.11    (d) A sale of building materials, supplies, and equipment to owners, contractors, 151.12subcontractors, or builders for the erection of buildings or the alteration, repair, or 151.13improvement of real property is a retail sale in whatever quantity sold, whether the sale is 151.14for purposes of resale in the form of real property or otherwise.151.15    (e) A sale of carpeting, linoleum, or similar floor covering to a person who provides 151.16for installation of the floor covering is a retail sale and not a sale for resale since a sale of 151.17floor covering which includes installation is a contract for the improvement of real property.151.18    (f) A sale of shrubbery, plants, sod, trees, and similar items to a person who provides 151.19for installation of the items is a retail sale and not a sale for resale since a sale of 151.20shrubbery, plants, sod, trees, and similar items that includes installation is a contract for 151.21the improvement of real property.151.22    (g) A sale of tangible personal property that is awarded as prizes is a retail sale and 151.23is not considered a sale of property for resale.151.24    (h) A sale of tangible personal property utilized or employed in the furnishing or 151.25providing of services under subdivision 3, paragraph (g), clause (1), including, but not 151.26limited to, property given as promotional items, is a retail sale and is not considered a 151.27sale of property for resale.151.28    (i) A sale of tangible personal property used in conducting lawful gambling under 151.29chapter 349 or the State Lottery under chapter 349A, including, but not limited to, property 151.30given as promotional items, is a retail sale and is not considered a sale of property for resale.151.31    (j) a sale of machines, equipment, or devices that are used to furnish, provide, or 151.32dispense goods or services, including, but not limited to, coin-operated devices, is a retail 151.33sale and is not considered a sale of property for resale.151.34    (k) In the case of a lease, a retail sale occurs (1) when an obligation to make a lease 151.35payment becomes due under the terms of the agreement or the trade practices of the 151.36lessor or (2) in the case of a lease of a motor vehicle, as defined in section 
         297B.01, 152.1subdivision 11
         , but excluding vehicles with a manufacturer's gross vehicle weight rating 152.2greater than 10,000 pounds and rentals of vehicles for not more than 28 days, at the time 152.3the lease is executed.152.4    (l) In the case of a conditional sales contract, a retail sale occurs upon the transfer of 152.5title or possession of the tangible personal property.152.6    (m) A sale of a bundled transaction in which one or more of the products included 152.7in the bundle is a taxable product is a retail sale, except that if one of the products 152.8is a telecommunication service, ancillary service, Internet access, or audio or video 152.9programming service, and the seller has maintained books and records identifying through 152.10reasonable and verifiable standards the portions of the price that are attributable to the 152.11distinct and separately identifiable products, then the products are not considered part of a 152.12bundled transaction. For purposes of this paragraph:152.13    (1) the books and records maintained by the seller must be maintained in the regular 152.14course of business, and do not include books and records created and maintained by the 152.15seller primarily for tax purposes;152.16    (2) books and records maintained in the regular course of business include, but are 152.17not limited to, financial statements, general ledgers, invoicing and billing systems and 152.18reports, and reports for regulatory tariffs and other regulatory matters; and152.19    (3) books and records are maintained primarily for tax purposes when the books 152.20and records identify taxable and nontaxable portions of the price, but the seller maintains 152.21other books and records that identify different prices attributable to the distinct products 152.22included in the same bundled transaction.152.23    (n) A sale of motor vehicle repair paint and materials by a motor vehicle repair or 152.24body shop business is a retail sale and the sales tax is imposed on the gross receipts from the 152.25retail sale of the paint and materials. The motor vehicle repair or body shop that purchases 152.26motor vehicle repair paint and motor vehicle repair materials for resale must either:152.27    (1) separately state each item of paint and each item of materials, and the sales price 152.28of each, on the invoice to the purchaser; or152.29    (2) in order to calculate the sales price of the paint and materials, use a method 152.30which estimates the amount and monetary value of the paint and materials used in 152.31the repair of the motor vehicle by multiplying the number of labor hours by a rate of 152.32consideration for the paint and materials used in the repair of the motor vehicle following 152.33industry standard practices that fairly calculate the gross receipts from the retail sale of 152.34the motor vehicle repair paint and motor vehicle repair materials. An industry standard 152.35practice fairly calculates the gross receipts if the sales price of the paint and materials used 152.36or consumed in the repair of a motor vehicle equals or exceeds the purchase price paid 153.1by the motor vehicle repair or body shop business. Under this clause, the invoice must 153.2either separately state the "paint and materials" as a single taxable item, or separately state 153.3"paint" as a taxable item and "materials" as a taxable item. This clause does not apply to 153.4wholesale transactions at an auto auction facility.153.5    (o) A sale of specified digital products or other digital products to an end user with 153.6or without rights of permanent use and regardless of whether rights of use are conditioned 153.7upon payment by the purchaser is a retail sale. When a digital code has been purchased that 153.8relates to specified digital products or other digital products, the subsequent receipt of or 153.9access to the related specified digital products or other digital products is not a retail sale.153.10    (p) A payment made to a cooperative electric association or public utility as a 153.11contribution in aid of construction is a contract for improvement to real property and 153.12is not a retail sale.153.13EFFECTIVE DATE.This section is effective for sales and purchases made after 153.14June 30, 2013.153.15    Sec. 4. Minnesota Statutes 2012, section 297A.61, subdivision 10, is amended to read:153.16    Subd. 10. Tangible personal property. (a) "Tangible personal property" means 153.17personal property that can be seen, weighed, measured, felt, or touched, or that is in any 153.18other manner perceptible to the senses. "Tangible personal property" includes, but is not 153.19limited to, electricity, water, gas, steam, and prewritten computer software.153.20    (b) Tangible personal property does not include:153.21    (1) large ponderous machinery and equipment used in a business or production 153.22activity which at common law would be considered to be real property;153.23    (2) property which is subject to an ad valorem property tax;153.24    (3) property described in section 
         272.02, subdivision 9, clauses (a) to (d); and153.25    (4) property described in section 
         272.03, subdivision 2, clauses (3) and (5).; and153.26(5) specified digital products, or other digital products, transferred electronically.153.27EFFECTIVE DATE.This section is effective for sales and purchases made after 153.28June 30, 2013.153.29    Sec. 5. Minnesota Statutes 2012, section 297A.61, subdivision 25, is amended to read:153.30    Subd. 25. Cable Pay television service. "Cable Pay television service" means 153.31the transmission of video, audio, or other programming service to purchasers, and the 153.32subscriber interaction, if any, required for the selection or use of the programming service, 153.33regardless of whether the programming is transmitted over facilities owned or operated 154.1by the cable service provider or over facilities owned or operated by one or more dealers 154.2of communications services. The term includes point-to-multipoint distribution direct to 154.3home satellite services by which programming is transmitted or broadcast by microwave 154.4or other equipment directly to the subscriber's premises, or any similar or comparable 154.5method of service. The term includes basic, extended, premium, all programming services, 154.6including subscriptions, digital video recorders, pay-per-view, digital, and music services.154.7EFFECTIVE DATE.This section is effective for sales and purchases made after 154.8June 30, 2013.154.9    Sec. 6. Minnesota Statutes 2012, section 297A.61, subdivision 38, is amended to read:154.10    Subd. 38. Bundled transaction. (a) "Bundled transaction" means the retail sale 154.11of two or more products when the products are otherwise distinct and identifiable, and 154.12the products are sold for one nonitemized price. As used in this subdivision, "product" 154.13includes tangible personal property, services, intangibles, and digital goods, including 154.14specified digital products or other digital products, but does not include real property or 154.15services to real property. A bundled transaction does not include the sale of any products 154.16in which the sales price varies, or is negotiable, based on the selection by the purchaser of 154.17the products included in the transaction.154.18    (b) For purposes of this subdivision, "distinct and identifiable" products does not 154.19include:154.20    (1) packaging and other materials, such as containers, boxes, sacks, bags, and 154.21bottles, wrapping, labels, tags, and instruction guides, that accompany the retail sale of the 154.22products and are incidental or immaterial to the retail sale. Examples of packaging that are 154.23incidental or immaterial include grocery sacks, shoe boxes, dry cleaning garment bags, 154.24and express delivery envelopes and boxes;154.25    (2) a promotional product provided free of charge with the required purchase of 154.26another product. A promotional product is provided free of charge if the sales price of 154.27another product, which is required to be purchased in order to receive the promotional 154.28product, does not vary depending on the inclusion of the promotional product; and154.29    (3) items included in the definition of sales price.154.30    (c) For purposes of this subdivision, the term "one nonitemized price" does not 154.31include a price that is separately identified by product on binding sales or other supporting 154.32sales-related documentation made available to the customer in paper or electronic form 154.33including but not limited to an invoice, bill of sale, receipt, contract, service agreement, 154.34lease agreement, periodic notice of rates and services, rate card, or price list.155.1    (d) A transaction that otherwise meets the definition of a bundled transaction is 155.2not a bundled transaction if it is:155.3    (1) the retail sale of tangible personal property and a service and the tangible 155.4personal property is essential to the use of the service, and is provided exclusively in 155.5connection with the service, and the true object of the transaction is the service;155.6    (2) the retail sale of services if one service is provided that is essential to the use or 155.7receipt of a second service and the first service is provided exclusively in connection with 155.8the second service and the true object of the transaction is the second service;155.9    (3) a transaction that includes taxable products and nontaxable products and the 155.10purchase price or sales price of the taxable products is de minimis; or155.11    (4) the retail sale of exempt tangible personal property and taxable tangible personal 155.12property if:155.13    (i) the transaction includes food and food ingredients, drugs, durable medical 155.14equipment, mobility enhancing equipment, over-the-counter drugs, prosthetic devices, 155.15or medical supplies; and155.16    (ii) the seller's purchase price or sales price of the taxable tangible personal property is 155.1750 percent or less of the total purchase price or sales price of the bundled tangible personal 155.18property. Sellers must not use a combination of the purchase price and sales price of the 155.19tangible personal property when making the 50 percent determination for a transaction.155.20    (e) For purposes of this subdivision, "purchase price" means the measure subject to 155.21use tax on purchases made by the seller, and "de minimis" means that the seller's purchase 155.22price or sales price of the taxable products is ten percent or less of the total purchase 155.23price or sales price of the bundled products. Sellers shall use either the purchase price 155.24or the sales price of the products to determine if the taxable products are de minimis. 155.25Sellers must not use a combination of the purchase price and sales price of the products 155.26to determine if the taxable products are de minimis. Sellers shall use the full term of a 155.27service contract to determine if the taxable products are de minimis.155.28EFFECTIVE DATE.This section is effective for sales and purchases made after 155.29June 30, 2013.155.30    Sec. 7. Minnesota Statutes 2012, section 297A.61, subdivision 45, is amended to read:155.31    Subd. 45. Ring tone. "Ring tone" means a digitized sound file that is downloaded 155.32onto a device and that may be used to alert the customer of a telecommunication service155.33 with respect to a communication. A ring tone does not include ring back tones or other 155.34digital audio files that are not stored on the purchaser's communication device.156.1EFFECTIVE DATE.This section is effective for sales and purchases made after 156.2June 30, 2013.156.3    Sec. 8. Minnesota Statutes 2012, section 297A.61, is amended by adding a subdivision 156.4to read:156.5    Subd. 49.Motor vehicle repair paint and motor vehicle repair materials."Motor 156.6vehicle repair paint" means a substance composed of solid matter suspended in a liquid 156.7medium and applied as a protective or decorative coating to the surface of a motor vehicle in 156.8order to restore the motor vehicle to its original condition, and includes primer, body paint, 156.9clear coat, and paint thinner used to paint motor vehicles, as defined in section 297B.01. 156.10"Motor vehicle repair materials" means items, other than motor vehicle repair paint 156.11or motor vehicle parts, that become a part of a repaired motor vehicle or are consumed in 156.12repairing the motor vehicle at retail, and include abrasives, battery water, body filler or 156.13putty, bolts and nuts, brake fluid, buffing pads, chamois, cleaning compounds, degreasing 156.14compounds, glaze, grease, grinding discs, hydraulic jack oil, lubricants, masking tape, 156.15oxygen and acetylene, polishes, rags, razor blades, sandpaper, sanding discs, scuff pads, 156.16sealer, solder, solvents, striping tape, tack cloth, thinner, waxes, and welding rods. Motor 156.17vehicle repair materials do not include items that are not used directly on the motor vehicle, 156.18such as floor dry that is used to clean the shop, or cleaning compounds and rags that are 156.19used to clean tools, equipment, or the shop and are not used to clean the motor vehicle.156.20EFFECTIVE DATE.This section is effective for sales and purchases made after 156.21June 30, 2013.156.22    Sec. 9. Minnesota Statutes 2012, section 297A.61, is amended by adding a subdivision 156.23to read:156.24    Subd. 50.Digital audio works."Digital audio works" means works that result from 156.25a fixation of a series of musical, spoken, or other sounds, that are transferred electronically. 156.26Digital audio works includes such items as the following which may either be prerecorded 156.27or live: songs, music, readings of books or other written materials, speeches, ring tones, or 156.28other sound recordings. Digital audio works does not include audio greeting cards sent by 156.29electronic mail. Unless the context provides otherwise, in this chapter digital audio works 156.30includes the digital code, or a subscription to or access to a digital code, for receiving, 156.31accessing, or otherwise obtaining digital audio works.156.32EFFECTIVE DATE.This section is effective for sales and purchases made after 156.33June 30, 2013.157.1    Sec. 10. Minnesota Statutes 2012, section 297A.61, is amended by adding a 157.2subdivision to read:157.3    Subd. 51.Digital audiovisual works."Digital audiovisual works" means a series 157.4of related images which, when shown in succession, impart an impression of motion, 157.5together with accompanying sounds, if any, that are transferred electronically. Digital 157.6audiovisual works includes such items as motion pictures, movies, musical videos, news 157.7and entertainment, and live events. Digital audiovisual works does not include video 157.8greeting cards sent by electronic mail. Unless the context provides otherwise, in this 157.9chapter digital audiovisual works includes the digital code, or a subscription to or access to 157.10a digital code, for receiving, accessing, or otherwise obtaining digital audiovisual works.157.11EFFECTIVE DATE.This section is effective for sales and purchases made after 157.12June 30, 2013.157.13    Sec. 11. Minnesota Statutes 2012, section 297A.61, is amended by adding a 157.14subdivision to read:157.15    Subd. 52.Digital books."Digital books" means any literary works, other than 157.16digital audiovisual works or digital audio works, expressed in words, numbers, or other 157.17verbal or numerical symbols or indicia so long as the product is generally recognized in 157.18the ordinary and usual sense as a "book." It includes works of fiction and nonfiction and 157.19short stories. It does not include periodicals, magazines, newspapers, or other news or 157.20information products, chat rooms, or weblogs. Unless the context provides otherwise, in 157.21this chapter digital books includes the digital code, or a subscription to or access to a 157.22digital code, for receiving, accessing, or otherwise obtaining digital books.157.23EFFECTIVE DATE.This section is effective for sales and purchases made after 157.24June 30, 2013.157.25    Sec. 12. Minnesota Statutes 2012, section 297A.61, is amended by adding a 157.26subdivision to read:157.27    Subd. 53.Digital code."Digital code" means a code which provides a purchaser 157.28with a right to obtain one or more specified digital products or other digital products. 157.29A digital code may be transferred electronically, such as through electronic mail, or it 157.30may be transferred on a tangible medium, such as on a plastic card, a piece of paper or 157.31invoice, or imprinted on another product. A digital code is not a code that represents a 157.32stored monetary value that is deducted from a total as it is used by the purchaser, and it 157.33is not a code that represents a redeemable card, gift card, or gift certificate that entitles 158.1the holder to select a digital product of an indicated cash value. The end user of a digital 158.2code is any purchaser except one who receives the contractual right to redistribute a digital 158.3product which is the subject of the transaction.158.4EFFECTIVE DATE.This section is effective for sales and purchases made after 158.5June 30, 2013.158.6    Sec. 13. Minnesota Statutes 2012, section 297A.61, is amended by adding a 158.7subdivision to read:158.8    Subd. 54.Other digital products."Other digital products" means the following 158.9items when transferred electronically:158.10(1) greeting cards; and158.11(2) online video or electronic games.158.12EFFECTIVE DATE.This section is effective for sales and purchases made after 158.13June 30, 2013.158.14    Sec. 14. Minnesota Statutes 2012, section 297A.61, is amended by adding a 158.15subdivision to read:158.16    Subd. 55.Specified digital products."Specified digital products" means digital 158.17audio works, digital audiovisual works, and digital books that are transferred electronically 158.18to a customer.158.19EFFECTIVE DATE.This section is effective for sales and purchases made after 158.20June 30, 2013.158.21    Sec. 15. Minnesota Statutes 2012, section 297A.61, is amended by adding a 158.22subdivision to read:158.23    Subd. 56.Transferred electronically."Transferred electronically" means obtained 158.24by the purchaser by means other than tangible storage media. For purposes of this 158.25subdivision, it is not necessary that a copy of the product be physically transferred to 158.26the purchaser. A product will be considered to have been transferred electronically to a 158.27purchaser if the purchaser has access to the product.158.28EFFECTIVE DATE.This section is effective for sales and purchases made after 158.29June 30, 2013.159.1    Sec. 16. Minnesota Statutes 2012, section 297A.61, is amended by adding a 159.2subdivision to read:159.3    Subd. 58.Self-storage service."Self-storage service" means a storage service that 159.4provides secure areas, such as rooms, units, compartments or containers, whether accessible 159.5from outside or from within a building, that are designated for the use of a purchaser, 159.6where the purchaser retains the care custody and control of their property, including 159.7self-storage units, mini-storage units, and areas by any other name to which the purchaser 159.8retains either unlimited free access or free access within reasonable business hours or upon 159.9reasonable notice to the service provider to add or remove property, but does not mean the 159.10rental of an entire building, such as a warehouse. Self-storage service does not include 159.11general warehousing and storage services where the warehouse typically handles, stores, 159.12and retrieves a purchaser's property using the warehouse's staff and equipment, and does 159.13not allow the purchaser free access to the storage space and does not include bailments.159.14EFFECTIVE DATE.This section is effective July 1, 2013.159.15    Sec. 17. Minnesota Statutes 2012, section 297A.64, subdivision 1, is amended to read:159.16    Subdivision 1. Tax imposed. A tax is imposed on the lease or rental in this state 159.17for not more than 28 days of a passenger automobile as defined in section 
         168.002, 159.18subdivision 24
         , a van as defined in section 
         168.002, subdivision 40, or a pickup truck as 159.19defined in section 
         168.002, subdivision 26. The rate of tax is 6.29.2 percent of the sales 159.20price. The tax applies whether or not the vehicle is licensed in the state.159.21EFFECTIVE DATE.This section is effective for sales and purchases made after 159.22June 30, 2013.159.23    Sec. 18. Minnesota Statutes 2012, section 297A.66, subdivision 3, is amended to read:159.24    Subd. 3. Retailer not maintaining place of business in this state. (a) To the extent 159.25allowed by the United States Constitution and the laws of the United States in accordance 159.26with the terms and conditions of federal remote seller law, a retailer making retail sales 159.27from outside this state to a destination within this state and not maintaining a place of 159.28business in this state shall collect sales and use taxes and remit them to the commissioner 159.29under section 
         297A.77,.159.30(b) To the extent allowed by the United States Constitution and the laws of the 159.31United States, a retailer making retail sales from outside this state to a destination within 159.32this state and not maintaining a place of business in this state shall collect sales and use 160.1taxes and remit them to the commissioner under section 297A.77, if the retailer engages in 160.2the regular or systematic soliciting of sales from potential customers in this state by:160.3(1) distribution, by mail or otherwise, of catalogs, periodicals, advertising flyers, or 160.4other written solicitations of business to customers in this state;160.5(2) display of advertisements on billboards or other outdoor advertising in this state;160.6(3) advertisements in newspapers published in this state;160.7(4) advertisements in trade journals or other periodicals the circulation of which is 160.8primarily within this state;160.9(5) advertisements in a Minnesota edition of a national or regional publication or 160.10a limited regional edition in which this state is included as part of a broader regional or 160.11national publication which are not placed in other geographically defined editions of the 160.12same issue of the same publication;160.13(6) advertisements in regional or national publications in an edition which is not 160.14by its contents geographically targeted to Minnesota but which is sold over the counter 160.15in Minnesota or by subscription to Minnesota residents;160.16(7) advertisements broadcast on a radio or television station located in Minnesota; or160.17(8) any other solicitation by telegraphy, telephone, computer database, cable, optic, 160.18microwave, or other communication system.160.19This paragraph (a) must be construed without regard to the state from which 160.20distribution of the materials originated or in which they were prepared.160.21(b) The location within or without this state of independent vendors that provide 160.22products or services to the retailer in connection with its solicitation of customers within this 160.23state, including such products and services as creation of copy, printing, distribution, and 160.24recording, is not considered in determining whether the retailer is required to collect tax.160.25(c) A retailer not maintaining a place of business in this state is presumed, subject to 160.26rebuttal, to be engaged in regular solicitation within this state if it engages in any of the 160.27activities in paragraph (a) and:160.28(1) makes 100 or more retail sales from outside this state to destinations in this state 160.29during a period of 12 consecutive months; or160.30(2) makes ten or more retail sales totaling more than $100,000 from outside this state 160.31to destinations in this state during a period of 12 consecutive months.160.32EFFECTIVE DATE.This section is effective the day after final enactment.160.33    Sec. 19. Minnesota Statutes 2012, section 297A.66, is amended by adding a 160.34subdivision to read:161.1    Subd. 4a.Solicitor.(a) "Solicitor," for purposes of subdivision 1, paragraph (a), 161.2means a person, whether an independent contractor or other representative, who directly 161.3or indirectly solicits business for the retailer.161.4(b) A retailer is presumed to have a solicitor in this state if it enters into an agreement 161.5with a resident under which the resident, for a commission or other substantially similar 161.6consideration, directly or indirectly refers potential customers, whether by a link on an 161.7Internet Web site, or otherwise, to the seller. This paragraph only applies if the total gross 161.8receipts are at least $10,000 in the 12-month period ending on the last day of the most recent 161.9calendar quarter before the calendar quarter in which the sale is made. For purposes of this 161.10paragraph, gross receipts means receipts from sales to customers located in the state who 161.11were referred to the retailer by all residents with this type of agreement with the retailer.161.12(c) The presumption under paragraph (b) may be rebutted by proof that the resident 161.13with whom the seller has an agreement did not engage in any solicitation in the state 161.14on behalf of the retailer that would satisfy the nexus requirement of the United States 161.15Constitution during the 12-month period in question. Nothing in this section shall be 161.16construed to narrow the scope of the terms affiliate, agent, salesperson, canvasser, or other 161.17representative for purposes of subdivision 1, paragraph (a).161.18(d) For purposes of this paragraph, "resident" includes an individual who is a 161.19resident of this state, as defined in section 290.01, or a business that owns tangible 161.20personal property located in this state or has one or more employees providing services for 161.21the business in this state.161.22(e) This subdivision does not apply to chapter 290 and does not expand or contract 161.23the jurisdiction to tax a trade or business under chapter 290.161.24EFFECTIVE DATE.This section is effective for sales and purchases made after 161.25June 30, 2013.161.26    Sec. 20. Minnesota Statutes 2012, section 297A.665, is amended to read:161.27297A.665 PRESUMPTION OF TAX; BURDEN OF PROOF.161.28    (a) For the purpose of the proper administration of this chapter and to prevent 161.29evasion of the tax, until the contrary is established, it is presumed that:161.30    (1) all gross receipts are subject to the tax; and161.31    (2) all retail sales for delivery in Minnesota are for storage, use, or other consumption 161.32in Minnesota.161.33    (b) The burden of proving that a sale is not a taxable retail sale is on the seller. 161.34However, a seller is relieved of liability if:162.1    (1) the seller obtains a fully completed exemption certificate or all the relevant 162.2information required by section 
         297A.72, subdivision 2, at the time of the sale or within 162.390 days after the date of the sale; or162.4    (2) if the seller has not obtained a fully completed exemption certificate or all the 162.5relevant information required by section 
         297A.72, subdivision 2, within the time provided 162.6in clause (1), within 120 days after a request for substantiation by the commissioner, 162.7the seller either:162.8    (i) obtains in good faith a fully completed exemption certificate or all the relevant 162.9information required by section 
         297A.72, subdivision 2, from the purchaser; or162.10    (ii) proves by other means that the transaction was not subject to tax;162.11    (3) in the case of drop shipment sales, a seller engaged in drop shipping may claim a 162.12resale exemption based on an exemption certificate provided by its customer or reseller, 162.13or any other acceptable information available to the seller engaged in drop shipping 162.14evidencing qualification for a resale exemption, regardless of whether the customer or 162.15reseller is registered to collect and remit sales and use tax in the state.162.16    (c) Notwithstanding paragraph (b), relief from liability does not apply to a seller who:162.17    (1) fraudulently fails to collect the tax; or162.18    (2) solicits purchasers to participate in the unlawful claim of an exemption.162.19    (d) A certified service provider, as defined in section 
         297A.995, subdivision 2, is 162.20relieved of liability under this section to the extent a seller who is its client is relieved of 162.21liability.162.22    (e) A purchaser of tangible personal property or any items listed in section 
         297A.63 162.23that are shipped or brought to Minnesota by the purchaser has the burden of proving that the 162.24property was not purchased from a retailer for storage, use, or consumption in Minnesota.162.25    (f) If a seller claims that certain sales are exempt and does not provide the certificate, 162.26information, or proof required by paragraph (b), clause (2), within 120 days after the date 162.27of the commissioner's request for substantiation, then the exemptions claimed by the seller 162.28that required substantiation are disallowed.162.29EFFECTIVE DATE.This section is effective for sales and purchases made after 162.30June 30, 2013.162.31    Sec. 21. Minnesota Statutes 2012, section 297A.668, is amended by adding a 162.32subdivision to read:162.33    Subd. 6a.Multiple points of use.(a) Notwithstanding the provisions of subdivisions 162.342 and 3, a business purchaser that has not received authorization to pay the tax directly to 162.35the commissioner may use an exemption certificate indicating multiple points of use if:163.1(1) the purchaser knows at the time of its purchase of a digital good, computer 163.2software delivered electronically, or a service that the good or service will be concurrently 163.3available for use in more than one taxing jurisdiction; and163.4(2) the purchaser delivers to the seller the exemption certificate indicating multiple 163.5points of use at the time of purchase.163.6(b) Upon receipt of the fully completed exemption certificate indicating multiple 163.7points of use, the seller is relieved of the obligation to collect, pay, or remit the applicable 163.8tax and the purchaser is obligated to collect, pay, or remit the applicable tax on a direct 163.9pay basis. The provisions of section 297A.665 apply to this paragraph.163.10(c) The purchaser delivering the exemption certificate indicating multiple points 163.11of use may use any reasonable but consistent and uniform method of apportionment 163.12that is supported by the purchaser's business records as they exist at the time of the 163.13consummation of the sale.163.14(d) The purchaser shall provide the exemption certificate indicating multiple points 163.15of use to the seller at the time of purchase.163.16(e) A purchaser that has received authorization to pay the tax directly to the 163.17commissioner is not required to deliver to the seller an exemption certificate indicating 163.18multiple points of use. A purchaser that has received authorization to pay the tax directly 163.19to the commissioner shall follow the provisions of paragraph (c) in apportioning the tax 163.20due on a digital good, computer software delivered electronically, or a service that will be 163.21concurrently available for use in more than one taxing jurisdiction.163.22EFFECTIVE DATE.This section is effective for sales and purchases made after 163.23June 30, 2013.163.24    Sec. 22. Minnesota Statutes 2012, section 297A.67, subdivision 7, is amended to read:163.25    Subd. 7. Drugs; medical devices. (a) Sales of the following drugs and medical 163.26devices for human use are exempt:163.27    (1) drugs, including over-the-counter drugs;163.28    (2) single-use finger-pricking devices for the extraction of blood and other single-use 163.29devices and single-use diagnostic agents used in diagnosing, monitoring, or treating 163.30diabetes;163.31    (3) insulin and medical oxygen for human use, regardless of whether prescribed 163.32or sold over the counter;163.33    (4) prosthetic devices;163.34    (5) durable medical equipment for home use only;163.35    (6) mobility enhancing equipment;164.1    (7) prescription corrective eyeglasses; and164.2    (8) kidney dialysis equipment, including repair and replacement parts.164.3(b) Items purchased in transactions covered by:164.4(1) Medicare as defined under title XVIII of the Social Security Act, United States 164.5Code, title 42, section 1395, et seq.; or164.6(2) Medicaid as defined under title XIX of the Social Security Act, United States 164.7Code, title 42, section 1396, et seq.164.8    (b) (c) For purposes of this subdivision:164.9    (1) "Drug" means a compound, substance, or preparation, and any component of 164.10a compound, substance, or preparation, other than food and food ingredients, dietary 164.11supplements, or alcoholic beverages that is:164.12    (i) recognized in the official United States Pharmacopoeia, official Homeopathic 164.13Pharmacopoeia of the United States, or official National Formulary, and supplement 164.14to any of them;164.15    (ii) intended for use in the diagnosis, cure, mitigation, treatment, or prevention 164.16of disease; or164.17    (iii) intended to affect the structure or any function of the body.164.18    (2) "Durable medical equipment" means equipment, including repair and 164.19replacement parts, including single-patient use items, but not including mobility enhancing 164.20equipment, that:164.21    (i) can withstand repeated use;164.22    (ii) is primarily and customarily used to serve a medical purpose;164.23    (iii) generally is not useful to a person in the absence of illness or injury; and164.24    (iv) is not worn in or on the body.164.25    For purposes of this clause, "repair and replacement parts" includes all components 164.26or attachments used in conjunction with the durable medical equipment, but does not 164.27include including repair and replacement parts which are for single patient use only.164.28    (3) "Mobility enhancing equipment" means equipment, including repair and 164.29replacement parts, but not including durable medical equipment, that:164.30    (i) is primarily and customarily used to provide or increase the ability to move from 164.31one place to another and that is appropriate for use either in a home or a motor vehicle;164.32    (ii) is not generally used by persons with normal mobility; and164.33    (iii) does not include any motor vehicle or equipment on a motor vehicle normally 164.34provided by a motor vehicle manufacturer.164.35    (4) "Over-the-counter drug" means a drug that contains a label that identifies the 164.36product as a drug as required by Code of Federal Regulations, title 21, section 201.66. The 165.1label must include a "drug facts" panel or a statement of the active ingredients with a list of 165.2those ingredients contained in the compound, substance, or preparation. Over-the-counter 165.3drugs do not include grooming and hygiene products, regardless of whether they otherwise 165.4meet the definition. "Grooming and hygiene products" are soaps, cleaning solutions, 165.5shampoo, toothpaste, mouthwash, antiperspirants, and suntan lotions and sunscreens.165.6    (5) "Prescribed" and "prescription" means a direction in the form of an order, 165.7formula, or recipe issued in any form of oral, written, electronic, or other means of 165.8transmission by a duly licensed health care professional.165.9    (6) "Prosthetic device" means a replacement, corrective, or supportive device, 165.10including repair and replacement parts, worn on or in the body to:165.11    (i) artificially replace a missing portion of the body;165.12    (ii) prevent or correct physical deformity or malfunction; or165.13    (iii) support a weak or deformed portion of the body.165.14Prosthetic device does not include corrective eyeglasses.165.15    (7) "Kidney dialysis equipment" means equipment that:165.16    (i) is used to remove waste products that build up in the blood when the kidneys are 165.17not able to do so on their own; and165.18    (ii) can withstand repeated use, including multiple use by a single patient, 165.19notwithstanding the provisions of clause (2).165.20(8) A transaction is covered by Medicare or Medicaid if any portion of the cost of 165.21the item purchased in the transaction is paid for or reimbursed by the federal government 165.22or the state of Minnesota pursuant to the Medicare or Medicaid program, by a private 165.23insurance company administering the Medicare or Medicaid program on behalf of the 165.24federal government or the state of Minnesota, or by a managed care organization for the 165.25benefit of a patient enrolled in a prepaid program that furnishes medical services in lieu 165.26of conventional Medicare or Medicaid coverage pursuant to agreement with the federal 165.27government or the state of Minnesota.165.28EFFECTIVE DATE.This section is effective for sales and purchases made after 165.29June 30, 2013.165.30    Sec. 23. Minnesota Statutes 2012, section 297A.67, is amended by adding a 165.31subdivision to read:165.32    Subd. 7a.Accessories and supplies.Accessories and supplies required for the 165.33effective use of durable medical equipment for home use only or purchased in a transaction 165.34covered by medicare or Medicaid, that are not already exempt under section 297A.67, 165.35subdivision 7, are exempt. Accessories and supplies for the effective use of a prosthetic 166.1device that are not already exempt under section 297A.67, subdivision 7, are exempt. 166.2For purposes of this subdivision "durable medical equipment," "prosthetic device," 166.3"Medicare," and "Medicaid" have the definitions given in section 297A.67, subdivision 7.166.4EFFECTIVE DATE.This section is effective for sales and purchases made after 166.5June 30, 2013.166.6    Sec. 24. Minnesota Statutes 2012, section 297A.67, subdivision 13, is amended to read:166.7    Subd. 13. Textbooks. Textbooks, including digital books, that are prescribed for use 166.8in conjunction with a course of study in a school, college, university, and private career 166.9school to students who are regularly enrolled at such institutions are exempt. For purposes 166.10of this subdivision (1) a "school" is as defined in section 
         120A.22, subdivision 4; and (2) 166.11"private career school" means a school licensed under section 
         141.25.166.12EFFECTIVE DATE.This section is effective for sales and purchases made after 166.13June 30, 2013.166.14    Sec. 25. Minnesota Statutes 2012, section 297A.68, subdivision 2, is amended to read:166.15    Subd. 2. Materials consumed in industrial production. (a) Materials stored, used, 166.16or consumed in industrial production of tangible personal property intended to be sold 166.17ultimately at retail, are exempt, whether or not the item so used becomes an ingredient 166.18or constituent part of the property produced. Materials that qualify for this exemption 166.19include, but are not limited to, the following:166.20(1) chemicals, including chemicals used for cleaning food processing machinery 166.21and equipment;166.22(2) materials, including chemicals, fuels, and electricity purchased by persons 166.23engaged in industrial production to treat waste generated as a result of the production 166.24process;166.25(3) fuels, electricity, gas, and steam used or consumed in the production process, 166.26except that electricity, gas, or steam used for space heating, cooling, or lighting is exempt 166.27if (i) it is in excess of the average climate control or lighting for the production area, and 166.28(ii) it is necessary to produce that particular product;166.29(4) petroleum products and lubricants;166.30(5) packaging materials, including returnable containers used in packaging food 166.31and beverage products;167.1(6) accessory tools, equipment, and other items that are separate detachable units 167.2with an ordinary useful life of less than 12 months used in producing a direct effect upon 167.3the product; and167.4(7) the following materials, tools, and equipment used in metal-casting: crucibles, 167.5thermocouple protection sheaths and tubes, stalk tubes, refractory materials, molten metal 167.6filters and filter boxes, degassing lances, and base blocks.167.7(b) This exemption does not include:167.8(1) machinery, equipment, implements, tools, accessories, appliances, contrivances 167.9and furniture and fixtures, except those listed in paragraph (a), clause (6); and167.10(2) petroleum and special fuels used in producing or generating power for propelling 167.11ready-mixed concrete trucks on the public highways of this state.167.12(c) Industrial production includes, but is not limited to, research, development, 167.13design or production of any tangible personal property, manufacturing, processing (other 167.14than by restaurants and consumers) of agricultural products (whether vegetable or animal), 167.15commercial fishing, refining, smelting, reducing, brewing, distilling, printing, mining, 167.16quarrying, lumbering, generating electricity, the production of road building materials, 167.17and the research, development, design, or production of computer software. Industrial 167.18production does not include painting, cleaning, repairing or similar processing of property 167.19except as part of the original manufacturing process.167.20(d) Industrial production does not include:167.21(1) the furnishing of services listed in section 
         297A.61, subdivision 3, paragraph (g), 167.22clause (6), items (i) to (vi) and (viii), or paragraph (m); or167.23(2) the transportation, transmission, or distribution of petroleum, liquefied gas, 167.24natural gas, water, or steam, in, by, or through pipes, lines, tanks, mains, or other means of 167.25transporting those products. For purposes of this paragraph, "transportation, transmission, 167.26or distribution" does not include blending of petroleum or biodiesel fuel as defined 167.27in section 
         239.77.167.28EFFECTIVE DATE.This section is effective for sales and purchases made after 167.29June 30, 2013.167.30    Sec. 26. Minnesota Statutes 2012, section 297A.68, subdivision 5, is amended to read:167.31    Subd. 5. Capital equipment. (a) Capital equipment is exempt. The tax must be 167.32imposed and collected as if the rate under section 297A.62, subdivision 1, applied, and 167.33then refunded in the manner provided in section 297A.75.167.34"Capital equipment" means machinery and equipment purchased or leased, and used 167.35in this state by the purchaser or lessee primarily for manufacturing, fabricating, mining, 168.1or refining tangible personal property to be sold ultimately at retail if the machinery and 168.2equipment are essential to the integrated production process of manufacturing, fabricating, 168.3mining, or refining. Capital equipment also includes machinery and equipment 168.4used primarily to electronically transmit results retrieved by a customer of an online 168.5computerized data retrieval system.168.6(b) Capital equipment includes, but is not limited to:168.7(1) machinery and equipment used to operate, control, or regulate the production 168.8equipment;168.9(2) machinery and equipment used for research and development, design, quality 168.10control, and testing activities;168.11(3) environmental control devices that are used to maintain conditions such as 168.12temperature, humidity, light, or air pressure when those conditions are essential to and are 168.13part of the production process;168.14(4) materials and supplies used to construct and install machinery or equipment;168.15(5) repair and replacement parts, including accessories, whether purchased as spare 168.16parts, repair parts, or as upgrades or modifications to machinery or equipment;168.17(6) materials used for foundations that support machinery or equipment;168.18(7) materials used to construct and install special purpose buildings used in the 168.19production process;168.20(8) ready-mixed concrete equipment in which the ready-mixed concrete is mixed 168.21as part of the delivery process regardless if mounted on a chassis, repair parts for 168.22ready-mixed concrete trucks, and leases of ready-mixed concrete trucks; and168.23(9) machinery or equipment used for research, development, design, or production 168.24of computer software.168.25(c) Capital equipment does not include the following:168.26(1) motor vehicles taxed under chapter 297B;168.27(2) machinery or equipment used to receive or store raw materials;168.28(3) building materials, except for materials included in paragraph (b), clauses (6) 168.29and (7);168.30(4) machinery or equipment used for nonproduction purposes, including, but not 168.31limited to, the following: plant security, fire prevention, first aid, and hospital stations; 168.32support operations or administration; pollution control; and plant cleaning, disposal of 168.33scrap and waste, plant communications, space heating, cooling, lighting, or safety;168.34(5) farm machinery and aquaculture production equipment as defined by section 168.35297A.61
         , subdivisions 12 and 13;169.1(6) machinery or equipment purchased and installed by a contractor as part of an 169.2improvement to real property;169.3(7) machinery and equipment used by restaurants in the furnishing, preparing, or 169.4serving of prepared foods as defined in section 
         297A.61, subdivision 31;169.5(8) machinery and equipment used to furnish the services listed in section 
         297A.61, 169.6subdivision 3
         , paragraph (g), clause (6), items (i) to (vi) and (viii);169.7(9) machinery or equipment used in the transportation, transmission, or distribution 169.8of petroleum, liquefied gas, natural gas, water, or steam, in, by, or through pipes, lines, 169.9tanks, mains, or other means of transporting those products. This clause does not apply to 169.10machinery or equipment used to blend petroleum or biodiesel fuel as defined in section 169.11239.77
         ; or169.12(10) any other item that is not essential to the integrated process of manufacturing, 169.13fabricating, mining, or refining.169.14(d) For purposes of this subdivision:169.15(1) "Equipment" means independent devices or tools separate from machinery but 169.16essential to an integrated production process, including computers and computer software, 169.17used in operating, controlling, or regulating machinery and equipment; and any subunit or 169.18assembly comprising a component of any machinery or accessory or attachment parts of 169.19machinery, such as tools, dies, jigs, patterns, and molds.169.20(2) "Fabricating" means to make, build, create, produce, or assemble components or 169.21property to work in a new or different manner.169.22(3) "Integrated production process" means a process or series of operations through 169.23which tangible personal property is manufactured, fabricated, mined, or refined. For 169.24purposes of this clause, (i) manufacturing begins with the removal of raw materials 169.25from inventory and ends when the last process prior to loading for shipment has been 169.26completed; (ii) fabricating begins with the removal from storage or inventory of the 169.27property to be assembled, processed, altered, or modified and ends with the creation 169.28or production of the new or changed product; (iii) mining begins with the removal of 169.29overburden from the site of the ores, minerals, stone, peat deposit, or surface materials and 169.30ends when the last process before stockpiling is completed; and (iv) refining begins with 169.31the removal from inventory or storage of a natural resource and ends with the conversion 169.32of the item to its completed form.169.33(4) "Machinery" means mechanical, electronic, or electrical devices, including 169.34computers and computer software, that are purchased or constructed to be used for the 169.35activities set forth in paragraph (a), beginning with the removal of raw materials from 169.36inventory through completion of the product, including packaging of the product.170.1(5) "Machinery and equipment used for pollution control" means machinery and 170.2equipment used solely to eliminate, prevent, or reduce pollution resulting from an activity 170.3described in paragraph (a).170.4(6) "Manufacturing" means an operation or series of operations where raw materials 170.5are changed in form, composition, or condition by machinery and equipment and which 170.6results in the production of a new article of tangible personal property. For purposes of 170.7this subdivision, "manufacturing" includes the generation of electricity or steam to be 170.8sold at retail.170.9(7) "Mining" means the extraction of minerals, ores, stone, or peat.170.10(8) "Online data retrieval system" means a system whose cumulation of information 170.11is equally available and accessible to all its customers.170.12(9) "Primarily" means machinery and equipment used 50 percent or more of the time 170.13in an activity described in paragraph (a).170.14(10) "Refining" means the process of converting a natural resource to an intermediate 170.15or finished product, including the treatment of water to be sold at retail.170.16(11) This subdivision does not apply to telecommunications equipment as 170.17provided in subdivision 35, and does not apply to wire, cable, fiber, poles, or conduit 170.18for telecommunications services.170.19EFFECTIVE DATE.This section is effective for sales and purchases made after 170.20August 31, 2014.170.21    Sec. 27. Minnesota Statutes 2012, section 297A.68, subdivision 42, is amended to read:170.22    Subd. 42. Qualified data centers. (a) Purchases of enterprise information 170.23technology equipment and computer software for use in a qualified data center, or a 170.24qualified refurbished data center, are exempt. The tax on purchases exempt under this 170.25paragraph must be imposed and collected as if the rate under section 
         297A.62, subdivision 170.261
         , applied, and then refunded after June 30, 2013, in the manner provided in section 170.27297A.75
         . This exemption includes enterprise information technology equipment and 170.28computer software purchased to replace or upgrade enterprise information technology 170.29equipment and computer software in a qualified data center, or a qualified refurbished 170.30data center.170.31(b) Electricity used or consumed in the operation of a qualified data center is exempt.170.32(c) For purposes of this subdivision, "qualified data center, or a qualified refurbished 170.33data center," means a facility in Minnesota:170.34(1) that is comprised of one or more buildings that consist in the aggregate of at least 170.3530,000 25,000 square feet, and that are located on a single parcel or on contiguous parcels, 171.1where the total cost of construction or refurbishment, investment in enterprise information 171.2technology equipment, and computer software is at least $50,000,000 $30,000,000 within 171.3a 24 48-month period;171.4(2) that is constructed or substantially refurbished after June 30, 2012, where 171.5"substantially refurbished" means that at least 30,000 25,000 square feet have been rebuilt 171.6or modified; and, including:171.7(i) installation of enterprise information technology equipment, environmental 171.8control, computer software, and energy efficiency improvements; and171.9(ii) building improvements; and171.10(3) that is used to house enterprise information technology equipment, where the 171.11facility has the following characteristics:171.12(i) uninterruptible power supplies, generator backup power, or both;171.13(ii) sophisticated fire suppression and prevention systems; and171.14(iii) enhanced security. A facility will be considered to have enhanced security if it 171.15has restricted access to the facility to selected personnel; permanent security guards; video 171.16camera surveillance; an electronic system requiring pass codes, keycards, or biometric 171.17scans, such as hand scans and retinal or fingerprint recognition; or similar security features.171.18In determining whether the facility has the required square footage, the square 171.19footage of the following spaces shall be included if the spaces support the operation 171.20of enterprise information technology equipment: office space, meeting space, and 171.21mechanical and other support facilities. For purposes of this subdivision, "computer 171.22software" includes, but is not limited to, software utilized or loaded at the qualified data 171.23center, including maintenance, licensing, and software customization.171.24(d) For purposes of this subdivision, a "qualified refurbished data center" means an 171.25existing facility that qualifies as a data center under paragraph (c), clauses (2) and (3), but 171.26that is comprised of one or more buildings that consist in the aggregate of at least 25,000 171.27square feet, and that are located on a single parcel or contiguous parcels, where the total 171.28cost of construction or refurbishment, investment in enterprise information technology 171.29equipment, and computer software is at least $50,000,000 within a 24-month period.171.30(d) (e) For purposes of this subdivision, "enterprise information technology 171.31equipment" means computers and equipment supporting computing, networking, or data 171.32storage, including servers and routers. It includes, but is not limited to: cooling systems, 171.33cooling towers, and other temperature control infrastructure; power infrastructure for 171.34transformation, distribution, or management of electricity used for the maintenance 171.35and operation of a qualified data center, including but not limited to exterior dedicated 171.36business-owned substations, backup power generation systems, battery systems, and 172.1related infrastructure; and racking systems, cabling, and trays, which are necessary for 172.2the maintenance and operation of the qualified data center.172.3(e) (f) A qualified data center may claim the exemptions in this subdivision for 172.4purchases made either within 20 years of the date of its first purchase qualifying for the 172.5exemption under paragraph (a), or by June 30, 2042, whichever is earlier.172.6(f) (g) The purpose of this exemption is to create jobs in the construction and data 172.7center industries.172.8(g) (h) This subdivision is effective for sales and purchases made after June 30, 172.92012, and before July 1, 2042.172.10EFFECTIVE DATE.This section is effective for sales and purchases made after 172.11June 30, 2013.172.12    Sec. 28. Minnesota Statutes 2012, section 297A.68, is amended by adding a 172.13subdivision to read:172.14    Subd. 49.Greater Minnesota business expansions.(a) Purchases and use of 172.15tangible personal property or taxable services by a qualified business, as defined in section 172.16116J.3738, are exempt if:172.17(1) the business subsidy agreement provides that the exemption under this 172.18subdivision applies;172.19(2) the property or services are primarily used or consumed in greater Minnesota; and172.20(3) the purchase was made and delivery received during the duration of the 172.21certification of the business as a qualified business under section 116J.3738.172.22(b) Purchase and use of construction materials and supplies used or consumed in, 172.23and equipment incorporated into, the construction of improvements to real property in 172.24greater Minnesota are exempt if the improvements after completion of construction are 172.25to be used in the conduct of the trade or business of the qualified business, as defined in 172.26section 116J.3738. This exemption applies regardless of whether the purchases are made 172.27by the business or a contractor.172.28(c) The exemptions under this subdivision apply to a local sales and use tax.172.29(d) The tax on purchases imposed under this subdivision must be imposed and 172.30collected as if the rate under section 297A.62 applied, and then refunded in the manner 172.31provided in section 297A.75. No more than $7,000,000 may be refunded in a fiscal year 172.32for all purchases under this subdivision. Refunds must be allocated on a first come, first 172.33served basis. If more than $7,000,000 of eligible claims are made in a fiscal year, claims 172.34by qualified businesses carryover to the next fiscal year, and the commissioner must first 172.35allocate refunds to qualified businesses eligible for a refund in the preceding fiscal year. 173.1Any portion of the balance of funds allocated for refunds under this paragraph does not 173.2cancel and shall be carried forward to and available for refunds in subsequent fiscal years.173.3EFFECTIVE DATE.This section is effective for sales and purchases made after 173.4June 30, 2014.173.5    Sec. 29. Minnesota Statutes 2012, section 297A.70, subdivision 2, is amended to read:173.6    Subd. 2. Sales to government. (a) All sales, except those listed in paragraph (b), 173.7to the following governments and political subdivisions, or to the listed agencies or 173.8instrumentalities of governments and political subdivisions, are exempt:173.9(1) the United States and its agencies and instrumentalities;173.10(2) school districts, local governments, the University of Minnesota, state universities, 173.11community colleges, technical colleges, state academies, the Perpich Minnesota Center for 173.12Arts Education, and an instrumentality of a political subdivision that is accredited as an 173.13optional/special function school by the North Central Association of Colleges and Schools;173.14(3) hospitals and nursing homes owned and operated by political subdivisions of 173.15the state of tangible personal property and taxable services used at or by hospitals and 173.16nursing homes;173.17(4) the Metropolitan Council, for its purchases of vehicles and repair parts to equip 173.18operations provided for in section 
         473.4051;173.19(5) other states or political subdivisions of other states, if the sale would be exempt 173.20from taxation if it occurred in that state; and173.21(6) public libraries, public library systems, multicounty, multitype library systems as 173.22defined in section 
         134.001, county law libraries under chapter 134A, state agency libraries, 173.23the state library under section 
         480.09, and the Legislative Reference Library; and.173.24(7) towns.173.25(b) This exemption does not apply to the sales of the following products and services:173.26(1) building, construction, or reconstruction materials purchased by a contractor 173.27or a subcontractor as a part of a lump-sum contract or similar type of contract with a 173.28guaranteed maximum price covering both labor and materials for use in the construction, 173.29alteration, or repair of a building or facility;173.30(2) construction materials purchased by tax exempt entities or their contractors to 173.31be used in constructing buildings or facilities which will not be used principally by the 173.32tax exempt entities;173.33(3) the leasing of a motor vehicle as defined in section 
         297B.01, subdivision 11, 173.34except for leases entered into by the United States or its agencies or instrumentalities;174.1(4) lodging as defined under section 
         297A.61, subdivision 3, paragraph (g), clause 174.2(2), and prepared food, candy, soft drinks, and alcoholic beverages as defined in section 174.3297A.67, subdivision 2
         , except for lodging, prepared food, candy, soft drinks, and alcoholic 174.4beverages purchased directly by the United States or its agencies or instrumentalities; or174.5(5) goods or services purchased by a town local government as inputs to goods and 174.6services that are generally provided by a private business and the purchases would be 174.7taxable if made by a private business engaged in the same activity.174.8(c) As used in this subdivision, "school districts" means public school entities and 174.9districts of every kind and nature organized under the laws of the state of Minnesota, and 174.10any instrumentality of a school district, as defined in section 
         471.59.174.11(d) As used in this subdivision, "local governments" means cities, counties, and 174.12townships.174.13(d) (e) As used in this subdivision, "goods or services generally provided by a private 174.14business" include, but are not limited to, goods or services provided by liquor stores, gas 174.15and electric utilities, golf courses, marinas, health and fitness centers, campgrounds, cafes, 174.16and laundromats. "Goods or services generally provided by a private business" do not 174.17include housing services, sewer and water services, wastewater treatment, ambulance and 174.18other public safety services, correctional services, chore or homemaking services provided 174.19to elderly or disabled individuals, or road and street maintenance or lighting.174.20EFFECTIVE DATE.This section is effective for sales and purchases made after 174.21December 31, 2013.174.22    Sec. 30. Minnesota Statutes 2012, section 297A.70, subdivision 4, is amended to read:174.23    Subd. 4. Sales to nonprofit groups. (a) All sales, except those listed in paragraph 174.24(b), to the following "nonprofit organizations" are exempt:174.25(1) a corporation, society, association, foundation, or institution organized and 174.26operated exclusively for charitable, religious, or educational purposes if the item 174.27purchased is used in the performance of charitable, religious, or educational functions; and174.28(2) any senior citizen group or association of groups that:174.29(i) in general limits membership to persons who are either age 55 or older, or 174.30physically disabled;174.31(ii) is organized and operated exclusively for pleasure, recreation, and other 174.32nonprofit purposes, not including housing, no part of the net earnings of which inures to 174.33the benefit of any private shareholders; and174.34(iii) is an exempt organization under section 501(c) of the Internal Revenue Code.175.1For purposes of this subdivision, charitable purpose includes the maintenance of a 175.2cemetery owned by a religious organization.175.3(b) This exemption does not apply to the following sales:175.4(1) building, construction, or reconstruction materials purchased by a contractor 175.5or a subcontractor as a part of a lump-sum contract or similar type of contract with a 175.6guaranteed maximum price covering both labor and materials for use in the construction, 175.7alteration, or repair of a building or facility;175.8(2) construction materials purchased by tax-exempt entities or their contractors to 175.9be used in constructing buildings or facilities that will not be used principally by the 175.10tax-exempt entities; and175.11(3) lodging as defined under section 
         297A.61, subdivision 3, paragraph (g), clause 175.12(2), and prepared food, candy, soft drinks, and alcoholic beverages as defined in section 175.13297A.67, subdivision 2
         , except wine purchased by an established religious organization 175.14for sacramental purposes or as allowed under subdivision 9a; and175.15(4) leasing of a motor vehicle as defined in section 
         297B.01, subdivision 11, except 175.16as provided in paragraph (c).175.17(c) This exemption applies to the leasing of a motor vehicle as defined in section 175.18297B.01, subdivision 11
         , only if the vehicle is:175.19(1) a truck, as defined in section 
         168.002, a bus, as defined in section 
         168.002, or a 175.20passenger automobile, as defined in section 
         168.002, if the automobile is designed and 175.21used for carrying more than nine persons including the driver; and175.22(2) intended to be used primarily to transport tangible personal property or 175.23individuals, other than employees, to whom the organization provides service in 175.24performing its charitable, religious, or educational purpose.175.25(d) A limited liability company also qualifies for exemption under this subdivision if 175.26(1) it consists of a sole member that would qualify for the exemption, and (2) the items 175.27purchased qualify for the exemption.175.28EFFECTIVE DATE.This section is effective retroactively for sales and purchases 175.29made after June 30, 2012.175.30    Sec. 31. Minnesota Statutes 2012, section 297A.70, subdivision 5, is amended to read:175.31    Subd. 5. Veterans groups. Sales to an organization of military service veterans or 175.32an auxiliary unit of an organization of military service veterans are exempt if:175.33(1) the organization or auxiliary unit is organized within the state of Minnesota 175.34and is exempt from federal taxation under section 501(c), clause (19), of the Internal 175.35Revenue Code; and176.1(2) the tangible personal property is or services are for charitable, civic, educational, 176.2or nonprofit uses and not for social, recreational, pleasure, or profit uses.176.3EFFECTIVE DATE.This section is effective for sales and purchases made after 176.4June 30, 2013.176.5    Sec. 32. Minnesota Statutes 2012, section 297A.70, subdivision 7, is amended to read:176.6    Subd. 7. Hospitals and, outpatient surgical centers, and critical access dental 176.7providers. (a) Sales, except for those listed in paragraph (c) (d), to a hospital are exempt, 176.8if the items purchased are used in providing hospital services. For purposes of this 176.9subdivision, "hospital" means a hospital organized and operated for charitable purposes 176.10within the meaning of section 501(c)(3) of the Internal Revenue Code, and licensed under 176.11chapter 144 or by any other jurisdiction, and "hospital services" are services authorized or 176.12required to be performed by a "hospital" under chapter 144.176.13    (b) Sales, except for those listed in paragraph (c) (d), to an outpatient surgical center 176.14are exempt, if the items purchased are used in providing outpatient surgical services. For 176.15purposes of this subdivision, "outpatient surgical center" means an outpatient surgical 176.16center organized and operated for charitable purposes within the meaning of section 176.17501(c)(3) of the Internal Revenue Code, and licensed under chapter 144 or by any other 176.18jurisdiction. For the purposes of this subdivision, "outpatient surgical services" means: 176.19(1) services authorized or required to be performed by an outpatient surgical center under 176.20chapter 144; and (2) urgent care. For purposes of this subdivision, "urgent care" means 176.21health services furnished to a person whose medical condition is sufficiently acute to 176.22require treatment unavailable through, or inappropriate to be provided by, a clinic or 176.23physician's office, but not so acute as to require treatment in a hospital emergency room.176.24    (c) Sales, except for those listed in paragraph (d), to a critical access dental provider 176.25are exempt, if the items purchased are used in providing critical access dental care 176.26services. For the purposes of this subdivision, "critical access dental provider" means a 176.27dentist or dental clinic that qualifies under section 256B.76, subdivision 4, paragraph (b) 176.28and, in the previous calendar year, had no more than 15 percent of its patients covered by 176.29private dental insurance.176.30    (d) This exemption does not apply to the following products and services:176.31    (1) purchases made by a clinic, physician's office, or any other medical facility not 176.32operating as a hospital or, outpatient surgical center, or critical access dental provider, 176.33even though the clinic, office, or facility may be owned and operated by a hospital or, 176.34 outpatient surgical center, or critical access dental provider;177.1    (2) sales under section 
         297A.61, subdivision 3, paragraph (g), clause (2), and 177.2prepared food, candy, and soft drinks;177.3    (3) building and construction materials used in constructing buildings or facilities 177.4that will not be used principally by the hospital or, outpatient surgical center, or critical 177.5access dental provider;177.6    (4) building, construction, or reconstruction materials purchased by a contractor or a 177.7subcontractor as a part of a lump-sum contract or similar type of contract with a guaranteed 177.8maximum price covering both labor and materials for use in the construction, alteration, or 177.9repair of a hospital or,  outpatient surgical center, or critical access dental provider; or177.10    (5) the leasing of a motor vehicle as defined in section 
         297B.01, subdivision 11.177.11    (d) (e) A limited liability company also qualifies for exemption under this 177.12subdivision if (1) it consists of a sole member that would qualify for the exemption, and 177.13(2) the items purchased qualify for the exemption.177.14    (e) (f) An entity that contains both a hospital and a nonprofit unit may claim this 177.15exemption on purchases made for both the hospital and nonprofit unit provided that:177.16    (1) the nonprofit unit would have qualified for exemption under subdivision 4; and177.17    (2) the items purchased would have qualified for the exemption.177.18EFFECTIVE DATE.This section is effective retroactively for sales and purchases 177.19made after June 30, 2007. Purchasers may apply for a refund of tax paid for qualifying 177.20purchases under this subdivision made after June 30, 2007, and before July 1, 2013, in the 177.21manner provided in Minnesota Statutes, section 297A.75. Notwithstanding limitations 177.22on claims for refunds under Minnesota Statutes, section 297A.40, claims may be filed 177.23with the commissioner until June 30, 2014.177.24    Sec. 33. Minnesota Statutes 2012, section 297A.70, is amended by adding a 177.25subdivision to read:177.26    Subd. 9a.Established religious orders.(a) Sales of lodging, prepared food, candy, 177.27soft drinks, and alcoholic beverages at noncatered events between an established religious 177.28order and an affiliated institution of higher education are exempt.177.29(b) For purposes of this subdivision, "established religious order" means an 177.30organization directly or indirectly under the control or supervision of a church or 177.31convention or association of churches, where members of the organization:177.32(1) normally live together as part of a community;177.33(2) make long-term commitments to live under a strict set of moral and spiritual 177.34rules; and178.1(3) work or engage full time in a combination of prayer, religious study, church 178.2reform or renewal, or other religious, educational, or charitable goals of the organization.178.3(c) For purposes of this subdivision, an institution of higher education is "affiliated" 178.4with an established religious order if members of the religious order are represented 178.5on the governing board of the institution of higher education and the two organization 178.6share campus space and common facilities.178.7EFFECTIVE DATE.This section is effective retroactively for sales and purchases 178.8made after June 30, 2012.178.9    Sec. 34. Minnesota Statutes 2012, section 297A.70, subdivision 13, is amended to read:178.10    Subd. 13. Fund-raising sales by or for nonprofit groups. (a) The following 178.11sales by the specified organizations for fund-raising purposes are exempt, subject to the 178.12limitations listed in paragraph (b):178.13(1) all sales made by a nonprofit organization that exists solely for the purpose of 178.14providing educational or social activities for young people primarily age 18 and under;178.15(2) all sales made by an organization that is a senior citizen group or association of 178.16groups if (i) in general it limits membership to persons age 55 or older; (ii) it is organized 178.17and operated exclusively for pleasure, recreation, and other nonprofit purposes; and (iii) 178.18no part of its net earnings inures to the benefit of any private shareholders;178.19(3) the sale or use of tickets or admissions to a golf tournament held in Minnesota if 178.20the beneficiary of the tournament's net proceeds qualifies as a tax-exempt organization 178.21under section 501(c)(3) of the Internal Revenue Code; and178.22(4) sales of candy sold for fund-raising purposes by a nonprofit organization that 178.23provides educational and social activities primarily for young people age 18 and under.178.24(b) The exemptions listed in paragraph (a) are limited in the following manner:178.25(1) the exemption under paragraph (a), clauses (1) and (2), applies only if the gross 178.26annual receipts of the organization from fund-raising do not exceed $10,000; and178.27(2) the exemption under paragraph (a), clause (1), does not apply if the sales are 178.28derived from admission charges or from activities for which the money must be deposited 178.29with the school district treasurer under section 
         123B.49, subdivision 2, or be recorded in 178.30the same manner as other revenues or expenditures of the school district under section 178.31123B.49, subdivision 4
         .178.32(c) Sales of tangible personal property and services are exempt if the entire proceeds, 178.33less the necessary expenses for obtaining the property or services, will be contributed to 178.34a registered combined charitable organization described in section 
         43A.50, to be used 178.35exclusively for charitable, religious, or educational purposes, and the registered combined 179.1charitable organization has given its written permission for the sale. Sales that occur over 179.2a period of more than 24 days per year are not exempt under this paragraph.179.3(d) For purposes of this subdivision, a club, association, or other organization of 179.4elementary or secondary school students organized for the purpose of carrying on sports, 179.5educational, or other extracurricular activities is a separate organization from the school 179.6district or school for purposes of applying the $10,000 limit.179.7EFFECTIVE DATE.This section is effective for sales and purchases made after 179.8June 30, 2013.179.9    Sec. 35. Minnesota Statutes 2012, section 297A.70, subdivision 14, is amended to read:179.10    Subd. 14. Fund-raising events sponsored by nonprofit groups. (a) Sales of 179.11tangible personal property or services at, and admission charges for fund-raising events 179.12sponsored by, a nonprofit organization are exempt if:179.13(1) all gross receipts are recorded as such, in accordance with generally accepted 179.14accounting practices, on the books of the nonprofit organization; and179.15(2) the entire proceeds, less the necessary expenses for the event, will be used solely 179.16and exclusively for charitable, religious, or educational purposes. Exempt sales include 179.17the sale of prepared food, candy, and soft drinks at the fund-raising event.179.18(b) This exemption is limited in the following manner:179.19(1) it does not apply to admission charges for events involving bingo or other 179.20gambling activities or to charges for use of amusement devices involving bingo or other 179.21gambling activities;179.22(2) all gross receipts are taxable if the profits are not used solely and exclusively for 179.23charitable, religious, or educational purposes;179.24(3) it does not apply unless the organization keeps a separate accounting record, 179.25including receipts and disbursements from each fund-raising event that documents all 179.26deductions from gross receipts with receipts and other records;179.27(4) it does not apply to any sale made by or in the name of a nonprofit corporation as 179.28the active or passive agent of a person that is not a nonprofit corporation;179.29(5) all gross receipts are taxable if fund-raising events exceed 24 days per year;179.30(6) it does not apply to fund-raising events conducted on premises leased for more 179.31than five days but less than 30 days; and179.32(7) it does not apply if the risk of the event is not borne by the nonprofit organization 179.33and the benefit to the nonprofit organization is less than the total amount of the state and 179.34local tax revenues forgone by this exemption.180.1(c) For purposes of this subdivision, a "nonprofit organization" means any unit of 180.2government, corporation, society, association, foundation, or institution organized and 180.3operated for charitable, religious, educational, civic, fraternal, and senior citizens' or 180.4veterans' purposes, no part of the net earnings of which inures to the benefit of a private 180.5individual.180.6EFFECTIVE DATE.This section is effective for sales and purchases made after 180.7June 30, 2013.180.8    Sec. 36. Minnesota Statutes 2012, section 297A.70, is amended by adding a 180.9subdivision to read:180.10    Subd. 18.Nursing homes and boarding care homes.(a) All sales, except those 180.11listed in paragraph (b), to a nursing home licensed under section 144A.02 or a boarding 180.12care home certified as a nursing facility under title 19 of the Social Security Act are 180.13exempt if the facility:180.14(1) is exempt from federal income taxation pursuant to section 501(c)(3) of the 180.15Internal Revenue Code; and180.16(2) is certified to participate in the medical assistance program under title 19 of the 180.17Social Security Act, or certifies to the commissioner that it does not discharge residents 180.18due to the inability to pay.180.19(b) This exemption does not apply to the following sales:180.20(1) building, construction, or reconstruction materials purchased by a contractor 180.21or a subcontractor as a part of a lump-sum contract or similar type of contract with a 180.22guaranteed maximum price covering both labor and materials for use in the construction, 180.23alteration, or repair of a building or facility;180.24(2) construction materials purchased by tax-exempt entities or their contractors to 180.25be used in constructing buildings or facilities that will not be used principally by the 180.26tax-exempt entities;180.27(3) lodging as defined under section 297A.61, subdivision 3, paragraph (g), clause 180.28(2), and prepared food, candy, soft drinks, and alcoholic beverages as defined in section 180.29297A.67, subdivision 2; and180.30(4) leasing of a motor vehicle as defined in section 297B.01, subdivision 11, except 180.31as provided in paragraph (c).180.32(c) This exemption applies to the leasing of a motor vehicle as defined in section 180.33297B.01, subdivision 11, only if the vehicle is:181.1(1) a truck, as defined in section 168.002; a bus, as defined in section 168.002; or a 181.2passenger automobile, as defined in section 168.002, if the automobile is designed and 181.3used for carrying more than nine persons including the driver; and181.4(2) intended to be used primarily to transport tangible personal property or residents 181.5of the nursing home or boarding care home.181.6EFFECTIVE DATE.This section is effective for sales and purchases made after 181.7June 30, 2013.181.8    Sec. 37. Minnesota Statutes 2012, section 297A.71, is amended by adding a 181.9subdivision to read:181.10    Subd. 45.Biopharmaceutical manufacturing facility.(a) Materials and 181.11supplies used or consumed in, capital equipment incorporated into, and privately 181.12owned infrastructure in support of the construction, improvement, or expansion of a 181.13biopharmaceutical manufacturing facility in the state are exempt if the following criteria 181.14are met:181.15(1) the facility is used for the manufacturing of biologics; 181.16(2) the total capital investment made at the facility exceeds $50,000,000; and181.17(3) the facility creates and maintains at least 190 full-time equivalent positions at the 181.18facility. These positions must be new jobs in Minnesota and not the result of relocating 181.19jobs that currently exist in Minnesota.181.20(b) The tax must be imposed and collected as if the rate under section 297A.62 181.21applied, and refunded in the manner provided in section 297A.75.181.22(c) To be eligible for a refund, the owner of the biopharmaceutical manufacturing 181.23facility must:181.24(1) initially apply to the Department of Employment and Economic Development 181.25for certification no later than one year from the final completion date of construction, 181.26improvement, or expansion of the facility; and181.27(2) for each year that the owner of the biopharmaceutical manufacturing facility 181.28applies for a refund, the owner must have received written certification from the 181.29Department of Employment and Economic Development that the facility has met the 181.30criteria of paragraph (a).181.31(d) The refund is to be paid annually at a rate of 25 percent of the total allowable 181.32refund payable to date, with the commissioner making annual payments of the remaining 181.33refund until all of the refund has been paid.181.34(e) For purposes of this subdivision, "biopharmaceutical" and "biologics" are 181.35interchangeable and mean medical drugs or medicinal preparations produced using 182.1technology that uses biological systems, living organisms or derivatives of living 182.2organisms, to make or modify products or processes for specific use. The medical drugs or 182.3medicinal preparations include but are not limited to proteins, antibodies, nucleic acids, 182.4and vaccines.182.5EFFECTIVE DATE.This section is effective retroactively to capital investments 182.6made and jobs created after December 31, 2012, and effective retroactively for sales and 182.7purchases made after December 31, 2012, and before July 1, 2019.182.8    Sec. 38. Minnesota Statutes 2012, section 297A.71, is amended by adding a 182.9subdivision to read:182.10    Subd. 46.Research and development facility.Materials and supplies used or 182.11consumed in, and equipment incorporated into, the construction or improvement of a 182.12research and development facility that has laboratory space of at least 400,000 square feet 182.13and utilizes both high-intensity and low-intensity laboratories, provided that the project 182.14has a total construction cost of at least $140,000,000 within a 24-month period. The tax on 182.15purchases imposed under this subdivision must be imposed and collected as if the rate under 182.16section 297A.62 applied and then refunded in the manner provided in section 297A.75.182.17EFFECTIVE DATE.This section is effective for sales and purchases made after 182.18June 30, 2013, and before September 1, 2015.182.19    Sec. 39. Minnesota Statutes 2012, section 297A.71, is amended by adding a 182.20subdivision to read:182.21    Subd. 47.Industrial measurement manufacturing and controls facility.(a) 182.22Materials and supplies used or consumed in, capital equipment incorporated into, 182.23fixtures installed in, and privately owned infrastructure in support of the construction, 182.24improvement, or expansion of an industrial measurement manufacturing and controls 182.25facility are exempt if:182.26(1) the total capital investment made at the facility is at least $60,000,000;182.27(2) the facility employs at least 250 full-time equivalent employees that are not 182.28employees currently employed by the company in the state; and182.29(3) the Department of Employment and Economic Development determines that 182.30the expansion, remodeling, or improvement of the facility has a significant impact on 182.31the state economy.183.1(b) The tax must be imposed and collected as if the rate under section 297A.62 183.2applied and refunded in the manner provided in section 297A.75, only after the following 183.3criteria are met:183.4(1) a refund may not be issued until the owner of the facility has received 183.5certification from the Department of Employment and Economic Development that the 183.6company meets the requirements in paragraph (a); and183.7(2) to receive the refund, the owner of the industrial measurement manufacturing 183.8and controls facility must initially apply to the Department of Employment and Economic 183.9Development for certification no later than one year from the final completion date of 183.10construction, improvement, or expansion of the industrial measurement manufacturing 183.11and controls facility.183.12EFFECTIVE DATE.This section is effective for sales and purchases made after 183.13June 30, 2013, and before December 31, 2015.183.14    Sec. 40. Minnesota Statutes 2012, section 297A.75, subdivision 1, is amended to read:183.15    Subdivision 1. Tax collected. The tax on the gross receipts from the sale of the 183.16following exempt items must be imposed and collected as if the sale were taxable and the 183.17rate under section 
         297A.62, subdivision 1, applied. The exempt items include:183.18    (1) capital equipment exempt under section 297A.68, subdivision 5;183.19    (2) (1) building materials for an agricultural processing facility exempt under section 183.20297A.71, subdivision 13
         ;183.21    (3) (2) building materials for mineral production facilities exempt under section 183.22297A.71, subdivision 14
         ;183.23    (4) (3) building materials for correctional facilities under section 
         297A.71, 183.24subdivision 3
         ;183.25    (5) (4) building materials used in a residence for disabled veterans exempt under 183.26section 
         297A.71, subdivision 11;183.27    (6) (5) elevators and building materials exempt under section 
         297A.71, subdivision 183.2812
         ;183.29    (7) (6) building materials for the Long Lake Conservation Center exempt under 183.30section 
         297A.71, subdivision 17;183.31    (8) (7) materials and supplies for qualified low-income housing under section 183.32297A.71, subdivision 23
         ;183.33    (9) (8) materials, supplies, and equipment for municipal electric utility facilities 183.34under section 
         297A.71, subdivision 35;184.1    (10) (9) equipment and materials used for the generation, transmission, and 184.2distribution of electrical energy and an aerial camera package exempt under section 184.3297A.68
         , subdivision 37;184.4    (11) (10) commuter rail vehicle and repair parts under section 
         297A.70, subdivision 184.53, paragraph (a), clause (10);184.6    (12) (11) materials, supplies, and equipment for construction or improvement of 184.7projects and facilities under section 
         297A.71, subdivision 40;184.8(13) (12) materials, supplies, and equipment for construction or improvement of a 184.9meat processing facility exempt under section 
         297A.71, subdivision 41;184.10(14) (13) materials, supplies, and equipment for construction, improvement, or 184.11expansion of:184.12(i) an aerospace defense manufacturing facility exempt under section 
         297A.71, 184.13subdivision 42;184.14(ii) a biopharmaceutical manufacturing facility exempt under section 297A.71, 184.15subdivision 45;184.16(iii) a research and development facility exempt under section 297A.71, subdivision 184.174b; and184.18(iv) an industrial measurement manufacturing and controls facility exempt under 184.19section 297A.71, subdivision 47;184.20(15) (14) enterprise information technology equipment and computer software for 184.21use in a qualified data center exempt under section 
         297A.68, subdivision 42; and184.22(16) (15) materials, supplies, and equipment for qualifying capital projects under 184.23section 
         297A.71, subdivision 44;184.24(16) items purchased for use in providing critical access dental services exempt 184.25under section 297A.70, subdivision 7, paragraph (c); and184.26(17) items and services purchased under a business subsidy agreement for use or 184.27consumption primarily in greater Minnesota exempt under section 297A.68, subdivision 49.184.28EFFECTIVE DATE.The change to clause (1) is effective for sales and purchases 184.29made after August 31, 2014. The changes in clauses (13), (16), and (17), are effective the 184.30day following final enactment.184.31    Sec. 41. Minnesota Statutes 2012, section 297A.75, subdivision 2, is amended to read:184.32    Subd. 2. Refund; eligible persons. Upon application on forms prescribed by the 184.33commissioner, a refund equal to the tax paid on the gross receipts of the exempt items 184.34must be paid to the applicant. Only the following persons may apply for the refund:185.1    (1) for subdivision 1, clauses (1) to (3), (2), and (16), the applicant must be the 185.2purchaser;185.3    (2) for subdivision 1, clauses (4) (3) and (7) (6), the applicant must be the 185.4governmental subdivision;185.5    (3) for subdivision 1, clause (5) (4), the applicant must be the recipient of the 185.6benefits provided in United States Code, title 38, chapter 21;185.7    (4) for subdivision 1, clause (6) (5), the applicant must be the owner of the 185.8homestead property;185.9    (5) for subdivision 1, clause (8) (7), the owner of the qualified low-income housing 185.10project;185.11    (6) for subdivision 1, clause (9) (8), the applicant must be a municipal electric utility 185.12or a joint venture of municipal electric utilities;185.13    (7) for subdivision 1, clauses (10), (9), (12), (13), (14), and (15) and (17), the owner 185.14of the qualifying business; and185.15    (8) for subdivision 1, clauses (10), (11), (12), and (16) (15), the applicant must be 185.16the governmental entity that owns or contracts for the project or facility.185.17EFFECTIVE DATE.This section is effective the day following final enactment.185.18    Sec. 42. Minnesota Statutes 2012, section 297A.75, subdivision 3, is amended to read:185.19    Subd. 3. Application. (a) The application must include sufficient information 185.20to permit the commissioner to verify the tax paid. If the tax was paid by a contractor, 185.21subcontractor, or builder, under subdivision 1, clause (4), (5), (6), (7), (8), (9), (10), (11), 185.22(12), (13), (14), clauses (3) to (15), or (16) (17), the contractor, subcontractor, or builder 185.23must furnish to the refund applicant a statement including the cost of the exempt items and 185.24the taxes paid on the items unless otherwise specifically provided by this subdivision. The 185.25provisions of sections 
         289A.40 and 
         289A.50 apply to refunds under this section.185.26    (b) An applicant may not file more than two applications per calendar year for 185.27refunds for taxes paid on capital equipment exempt under section 
         297A.68, subdivision 5.185.28    (c) Total refunds for purchases of items in section 
         297A.71, subdivision 40, must not 185.29exceed $5,000,000 in fiscal years 2010 and 2011. Applications for refunds for purchases 185.30of items in sections 
         297A.70, subdivision 3, paragraph (a), clause (11), and 
         297A.71, 185.31subdivision 40, must not be filed until after June 30, 2009.185.32EFFECTIVE DATE.This section is effective the day following final enactment.185.33    Sec. 43. Minnesota Statutes 2012, section 297A.99, subdivision 1, is amended to read:186.1    Subdivision 1. Authorization; scope. (a) A political subdivision of this state may 186.2impose a general sales tax (1) under section 
         297A.992, (2) under section 
         297A.993, (3) if 186.3permitted by special law, or (4) if the political subdivision enacted and imposed the tax 186.4before January 1, 1982, and its predecessor provision.186.5    (b) This section governs the imposition of a general sales tax by the political 186.6subdivision. The provisions of this section preempt the provisions of any special law:186.7    (1) enacted before June 2, 1997, or186.8    (2) enacted on or after June 2, 1997, that does not explicitly exempt the special law 186.9provision from this section's rules by reference.186.10    (c) This section does not apply to or preempt a sales tax on motor vehicles or a 186.11special excise tax on motor vehicles.186.12(d) A political subdivision may not advertise or expend funds for the promotion of a 186.13referendum to support imposing a local option sales tax. 186.14(e) Notwithstanding paragraph (d), a political subdivision may only expend funds to:186.15(1) conduct the referendum.;186.16(2) disseminate information included in the resolution adopted under subdivision 2;186.17(3) provide notice of, and conduct public forums at which proponents and opponents 186.18on the merits of the referendum are given equal time to express their opinions on the 186.19merits of the referendum;186.20(4) provide facts and data on the impact of the proposed sales tax on consumer 186.21purchases; and186.22(5) provide facts and data related to the programs and projects to be funded with 186.23the sales tax.186.24EFFECTIVE DATE.This section is effective the day following final enactment.186.25    Sec. 44. Laws 1993, chapter 375, article 9, section 46, subdivision 2, as amended by 186.26Laws 1997, chapter 231, article 7, section 40, Laws 1998, chapter 389, article 8, section 186.2730, Laws 2003, First Special Session chapter 21, article 8, section 13, Laws 2005, First 186.28Special Session chapter 3, article 5, section 26, and Laws 2009, chapter 88, article 4, 186.29section 15, is amended to read:186.30    Subd. 2. Use of revenues. Revenues received from the tax authorized by subdivision 186.311 may only be used by the city to pay the cost of collecting the tax, and, except as provided in 186.32paragraph (e), to pay for the following projects or to secure or pay any principal, premium, 186.33or interest on bonds issued in accordance with subdivision 3 for the following projects.186.34    (a) To pay all or a portion of the capital expenses of construction, equipment and 186.35acquisition costs for the expansion and remodeling of the St. Paul Civic Center complex, 187.1including the demolition of the existing arena and the construction and equipping of a 187.2new arena.187.3    (b) Except as provided in paragraphs (e) and (f), the remainder of the funds must be 187.4spent for:187.5    (1) capital projects to further residential, cultural, commercial, and economic 187.6development in both downtown St. Paul and St. Paul neighborhoods; and187.7    (2) capital and operating expenses of cultural organizations in the city, provided 187.8that the amount spent under this clause must equal ten percent of the total amount spent 187.9under this paragraph in any year.187.10    (c) The amount apportioned under paragraph (b) shall be no less than 60 percent 187.11of the revenues derived from the tax each year, except to the extent that a portion of that 187.12amount is required to pay debt service on (1) bonds issued for the purposes of paragraph (a) 187.13prior to March 1, 1998; or (2) bonds issued for the purposes of paragraph (a) after March 1, 187.141998, but only if the city council determines that 40 percent of the revenues derived from 187.15the tax together with other revenues pledged to the payment of the bonds, including the 187.16proceeds of definitive bonds, is expected to exceed the annual debt service on the bonds.187.17    (d) If in any year more than 40 percent of the revenue derived from the tax authorized 187.18by subdivision 1 is used to pay debt service on the bonds issued for the purposes of 187.19paragraph (a) and to fund a reserve for the bonds, the amount of the debt service payment 187.20that exceeds 40 percent of the revenue must be determined for that year. In any year when 187.2140 percent of the revenue produced by the sales tax exceeds the amount required to pay 187.22debt service on the bonds and to fund a reserve for the bonds under paragraph (a), the 187.23amount of the excess must be made available for capital projects to further residential, 187.24cultural, commercial, and economic development in the neighborhoods and downtown 187.25until the cumulative amounts determined for all years under the preceding sentence have 187.26been made available under this sentence. The amount made available as reimbursement in 187.27the preceding sentence is not included in the 60 percent determined under paragraph (c).187.28    (e) In each of calendar years 2006 to 2014, revenue not to exceed $3,500,000 may be 187.29used to pay the principal of bonds issued for capital projects of the city. After December 187.3031, 2014, revenue from the tax imposed under subdivision 1 may not be used for this 187.31purpose. If the amount necessary to meet obligations under paragraphs (a) and (d) are less 187.32than 40 percent of the revenue from the tax in any year, the city may place the difference 187.33between 40 percent of the revenue and the amounts allocated under paragraphs (a) and (d) 187.34in an economic development fund to be used for any economic development purposes.187.35    (f) By January 15 of each year, the mayor and the city council must report to the 187.36legislature on the use of sales tax revenues during the preceding one-year period.188.1EFFECTIVE DATE.This section is effective the day after compliance by the 188.2governing body of the city of St. Paul with Minnesota Statutes, section 645.021, 188.3subdivisions 2 and 3.188.4    Sec. 45. Laws 1993, chapter 375, article 9, section 46, subdivision 5, as amended by 188.5Laws 1998, chapter 389, article 8, section 32, is amended to read:188.6    Subd. 5. Expiration of taxing authority. The authority granted by subdivision 1 to 188.7the city to impose a sales tax shall expire on December 31, 2030 2042, or at an earlier 188.8time as the city shall, by ordinance, determine. Any funds remaining after completion of 188.9projects approved under subdivision 2, paragraph (a) and retirement or redemption of any 188.10bonds or other obligations may be placed in the general fund of the city.188.11EFFECTIVE DATE.This section is effective the day after compliance by the 188.12governing body of the city of St. Paul with Minnesota Statutes, section 645.021, 188.13subdivisions 2 and 3.188.14    Sec. 46. Laws 2002, chapter 377, article 3, section 25, as amended by Laws 2009, 188.15chapter 88, article 4, section 19, and Laws 2010, chapter 389, article 5, section 3, is 188.16amended to read:188.17    Sec. 25. ROCHESTER LODGING TAX.188.18    Subdivision 1. Authorization. Notwithstanding Minnesota Statutes, section 188.19469.190
          or 
         477A.016, or any other law, the city of Rochester may impose an additional 188.20tax of one percent on the gross receipts from the furnishing for consideration of lodging at 188.21a hotel, motel, rooming house, tourist court, or resort, other than the renting or leasing of it 188.22for a continuous period of 30 days or more.188.23    Subd. 1a. Authorization. Notwithstanding Minnesota Statutes, section 
         469.190 or 188.24477A.016
         , or any other law, and in addition to the tax authorized by subdivision 1, the city 188.25of Rochester may impose an additional tax of one three percent on the gross receipts from 188.26the furnishing for consideration of lodging at a hotel, motel, rooming house, tourist court, or 188.27resort, other than the renting or leasing of it for a continuous period of 30 days or more only 188.28upon the approval of the city governing body of a total financial package for the project.188.29    Subd. 2. Disposition of proceeds. (a) The gross proceeds from the tax imposed 188.30under subdivision 1 must be used by the city to fund a local convention or tourism bureau 188.31for the purpose of marketing and promoting the city as a tourist or convention center.188.32(b) The gross proceeds from the one three percent tax imposed under subdivision 188.331a shall be used to pay for (1) design, construction, renovation, improvement, and 188.34expansion of the Mayo Civic Center Complex and related infrastructure, including but not 189.1limited to, skyway access, lighting, parking, or landscaping; and (2) for payment of any 189.2principal, interest, or premium on bonds issued to finance the construction, renovation, 189.3improvement, and expansion of the Mayo Civic Center Complex.189.4    Subd. 2a. Bonds. The city of Rochester may issue, without an election, general 189.5obligation bonds of the city, in one or more series, in the aggregate principal amount not to 189.6exceed $43,500,000 $50,000,000, to pay for capital and administrative costs for the design, 189.7construction, renovation, improvement, and expansion of the Mayo Civic Center Complex, 189.8and related infrastructure, including but not limited to, skyway, access, lighting, parking, 189.9and landscaping. The city may pledge the lodging tax authorized by subdivision 1a and the 189.10food and beverage tax authorized under Laws 2009, chapter 88, article 4, section 23, to the 189.11payment of the bonds. The debt represented by the bonds is not included in computing any 189.12debt limitations applicable to the city, and the levy of taxes required by Minnesota Statutes, 189.13section 
         475.61, to pay the principal of and interest on the bonds is not subject to any levy 189.14limitation or included in computing or applying any levy limitation applicable to the city.189.15    Subd. 3. Expiration of taxing authority.The authority of the city to impose a tax 189.16under subdivision 1a shall expire when the principal and interest on any bonds or other 189.17obligations issued prior to December 31, 2014, to finance the construction, renovation, 189.18improvement, and expansion of the Mayo Civic Center Complex and related skyway 189.19access, lighting, parking, or landscaping have been paid, including any bonds issued to 189.20refund such bonds, or at an earlier time as the city shall, by ordinance, determine. Any 189.21funds remaining after completion of the project and retirement or redemption of the bonds 189.22shall be placed in the general fund of the city. The city may, by ordinance, repeal the 189.23tax provided that:189.24(1) the revenues raised before the repeal are sufficient to meet all bond or other 189.25obligations backed by revenues of the tax; and189.26(2) the repeal date meets the requirements of section 297A.99, subdivision 12.189.27EFFECTIVE DATE.This section is effective the day after the governing body of 189.28the city of Rochester and its chief fiscal officer comply with Minnesota Statutes, section 189.29645.021, subdivisions 2 and 3.189.30    Sec. 47. Laws 2005, First Special Session chapter 3, article 5, section 37, subdivision 189.312, is amended to read:189.32    Subd. 2. Use of revenues. (a) Revenues received from the tax authorized by 189.33subdivision 1 by the city of St. Cloud must be used for the cost of collecting and 189.34administering the tax and to pay all or part of the capital or administrative costs of the 189.35development, acquisition, construction, improvement, and securing and paying debt 190.1service on bonds or other obligations issued to finance the following regional projects as 190.2approved by the voters and specifically detailed in the referendum authorizing the tax or 190.3extending the tax:190.4    (1) St. Cloud Regional Airport;190.5    (2) regional transportation improvements;190.6    (3) regional community and aquatics centers;190.7    (4) regional public libraries; and 190.8    (5) acquisition and improvement of regional park land and open space.190.9    (b) Revenues received from the tax authorized by subdivision 1 by the cities of St. 190.10Joseph, Waite Park, Sartell, Sauk Rapids, and St. Augusta must be used for the cost of 190.11collecting and administering the tax and to pay all or part of the capital or administrative 190.12costs of the development, acquisition, construction, improvement, and securing and paying 190.13debt service on bonds or other obligations issued to fund the projects specifically approved 190.14by the voters at the referendum authorizing the tax or extending the tax. The portion of 190.15revenues from the city going to fund the regional airport or regional library located in the 190.16city of St. Cloud will be as required under the applicable joint powers agreement.190.17    (c) The use of revenues received from the taxes authorized in subdivision 1 for 190.18projects allowed under paragraphs (a) and (b) are limited to the amount authorized for 190.19each project under the enabling referendum.190.20EFFECTIVE DATE.This section is effective for the city that approves them the 190.21day after compliance by the governing body of each city with Minnesota Statutes, section 190.22645.021, subdivision 3.190.23    Sec. 48. Laws 2005, First Special Session chapter 3, article 5, section 37, subdivision 190.244, is amended to read:190.25    Subd. 4. Termination of tax. The tax imposed in the cities of St. Joseph, St. 190.26Cloud, St. Augusta, Sartell, Sauk Rapids, and Waite Park under subdivision 1 expires 190.27when the city council determines that sufficient funds have been collected from the tax 190.28to retire or redeem the bonds and obligations authorized under subdivision 2, paragraph 190.29(a), but no later than December 31, 2018. Notwithstanding Minnesota Statutes, section 190.30297A.99, subdivision 3, paragraphs (a), (c), and (d), a city may extend the tax imposed 190.31under subdivision 1 through December 31, 2038, if approved by voters of the city no later 190.32than November 7, 2017, at either a general election or at a special election held on a first 190.33Tuesday after a first Monday in November.191.1EFFECTIVE DATE.This section is effective for the city that approves them the 191.2day after compliance by the governing body of each city with Minnesota Statutes, section 191.3645.021, subdivision 3.191.4    Sec. 49. Laws 2008, chapter 366, article 7, section 19, subdivision 3, as amended by 191.5Laws 2011, First Special Session chapter 7, article 4, section 8, is amended to read:191.6    Subd. 3. Use of revenues. Notwithstanding Minnesota Statutes, section 
         297A.99, 191.7subdivision 3
         , paragraph (b), the proceeds of the tax imposed under this section shall be 191.8used to pay for the costs of improvements to the Sportsman Park/Ballfields, Riverside 191.9Park, Lions Park/Pavilion, Cedar South Park also known as Eldorado Park, and Spring 191.10Street Park; improvements to and extension of the River County Bike Trail; acquisition,191.11 and construction, improvement, and development of regional parks, bicycle trails, park 191.12land, open space, andof a pedestrian walkways, as described in the city improvement 191.13plan adopted by the city council by resolution on December 12, 2006, and walkway 191.14over Interstate 94 and State Highway 24; and the acquisition of land and construction of 191.15buildings for a community and recreation center. The total amount of revenues from the 191.16taxes in subdivisions 1 and 2 that may be used to fund these projects is $12,000,000 191.17plus any associated bond costs.191.18EFFECTIVE DATE.This section is effective the day after compliance by the 191.19governing body of the city of Clearwater with Minnesota Statutes, section 645.021, 191.20subdivisions 2 and 3.191.21    Sec. 50. Laws 2010, chapter 389, article 5, section 6, subdivision 6, is amended to read:191.22    Subd. 6. Use of food and beverages tax. The revenues derived from the tax 191.23imposed under subdivision 5 must be used by the city of Marshall to pay the costs of 191.24collecting and administering the food and beverages tax, to pay all or part of the operating 191.25costs of the new and existing facilities of the Minnesota Emergency Response and 191.26Industry Training Center, including the payment of debt service on bonds issued under 191.27subdivision 2, and to pay all or part of the operating costs of the facilities of the Southwest 191.28Minnesota Regional Amateur Sports Center, including the payment of debt service on 191.29bonds issued under subdivision 2. Authorized expenses for each organization include, 191.30but are not limited to, acquiring property; predesign; design; and paying construction, 191.31furnishing, and equipment costs related to these facilities and paying debt service on 191.32bonds or other obligations issued by the city.191.33EFFECTIVE DATE.This section is effective the day following final enactment.192.1    Sec. 51. CITY OF MARSHALL; VALIDATION OF PRIOR ACT.192.2    (a) Notwithstanding the time limits in Minnesota Statutes, section 645.021, the city 192.3of Marshall may approve Laws 2010, chapter 389, article 5, section 6, as amended by 192.4Laws 201l, First Special Session chapter 7, article 4, section 9, and file its approval with 192.5the secretary of state by June 15, 2013. If approved as authorized under this paragraph, 192.6actions undertaken by the city pursuant to the approval of the voters on November 6, 2012, 192.7and otherwise in accordance with Laws 2010, chapter 389, article 5, section 6, as amended 192.8by Laws 201l, First Special Session chapter 7, article 4, section 9, are validated.192.9    (b) Notwithstanding the time limit on the imposition of tax under Laws 2010, 192.10chapter 389, article 5, section 6, subdivision 1, as amended by Laws 201l, First Special 192.11Session chapter 7, article 4, section 9, and subject to local approval under paragraph (a), 192.12the city of Marshall may impose the tax on or before July 1, 2013.192.13EFFECTIVE DATE.This section is effective the day following final enactment.192.14    Sec. 52. CITY OF PROCTOR; VALIDATION OF PRIOR ACT.192.15    Notwithstanding the time limits in Minnesota Statutes, section 645.021, the city of 192.16Proctor may approve, by resolution, Laws 2008, chapter 366, article 7, section 13, and 192.17Laws 2010, chapter 389, article 5, sections 1 and 2, and file its approval with the secretary 192.18of state by January 1, 2014. If approved under this paragraph, actions undertaken by 192.19the city pursuant to the approval of the voters on November 2, 2010, and otherwise in 192.20accordance with those laws are validated.192.21EFFECTIVE DATE.This section is effective the day following final enactment.192.22    Sec. 53.  REPEALER.192.23(a) Minnesota Statutes 2012, sections 297A.61, subdivision 27; and 297A.68, 192.24subdivision 35, are repealed.192.25(b) Laws 2009, chapter 88, article 4, section 23, as amended by Laws 2010, chapter 192.26389, article 5, section 4, is repealed.192.27EFFECTIVE DATE.Paragraph (a) is effective for sales and purchases made after 192.28June 30, 2013. Paragraph (b) is effective the day following final enactment.192.29ARTICLE 9192.30ECONOMIC DEVELOPMENT192.31    Section 1. Minnesota Statutes 2012, section 469.071, subdivision 5, is amended to read:193.1    Subd. 5. Exception; parking facilities. Notwithstanding section 
         469.068, the 193.2Bloomington port authority need not require competitive bidding with respect to a 193.3structured parking facility or other public improvements constructed in conjunction with, 193.4and directly above or below, or adjacent and integrally related to, a development and 193.5financed with the proceeds of tax increment or, revenue bonds, or other funds of the 193.6port authority and the city of Bloomington.193.7EFFECTIVE DATE.This section is effective upon compliance of the governing 193.8body of the city of Bloomington with the requirements of Minnesota Statutes, section 193.9645.021, subdivision 3.193.10    Sec. 2. Minnesota Statutes 2012, section 469.169, is amended by adding a subdivision 193.11to read:193.12    Subd. 19.Additional border city allocation; 2013.(a) In addition to the tax 193.13reductions authorized in subdivisions 12 to 18, the commissioner shall allocate $750,000 193.14for tax reductions to border city enterprise zones in cities located on the western border 193.15of the state. The commissioner shall allocate this amount among cities on a per capita 193.16basis. Allocations made under this subdivision may be used for tax reductions under 193.17section 469.171, or for other offsets of taxes imposed on or remitted by businesses located 193.18in the enterprise zone, but only if the municipality determines that the granting of the tax 193.19reduction or offset is necessary to retain a business within or attract a business to the zone. 193.20The city alternatively may elect to use any portion of the allocation under this paragraph 193.21for tax reductions under section 469.1732 or 469.1734.193.22    (b) The commissioner shall allocate $750,000 for tax reductions under section 193.23469.1732 or 469.1734 to cities with border city enterprise zones located on the western 193.24border of the state. The commissioner shall allocate this amount among the cities on a per 193.25capita basis. The city alternatively may elect to use any portion of the allocation provided 193.26in this paragraph for tax reductions under section 469.171.193.27EFFECTIVE DATE.This section is effective July 1, 2013.193.28    Sec. 3. Minnesota Statutes 2012, section 469.176, subdivision 4c, is amended to read:193.29    Subd. 4c. Economic development districts. (a) Revenue derived from tax increment 193.30from an economic development district may not be used to provide improvements, loans, 193.31subsidies, grants, interest rate subsidies, or assistance in any form to developments 193.32consisting of buildings and ancillary facilities, if more than 15 percent of the buildings and 193.33facilities (determined on the basis of square footage) are used for a purpose other than:194.1    (1) the manufacturing or production of tangible personal property, including 194.2processing resulting in the change in condition of the property;194.3    (2) warehousing, storage, and distribution of tangible personal property, excluding 194.4retail sales;194.5    (3) research and development related to the activities listed in clause (1) or (2);194.6    (4) telemarketing if that activity is the exclusive use of the property;194.7    (5) tourism facilities; or194.8    (6) qualified border retail facilities; or194.9    (7) space necessary for and related to the activities listed in clauses (1) to (6) (5).194.10    (b) Notwithstanding the provisions of this subdivision, revenues derived from tax 194.11increment from an economic development district may be used to provide improvements, 194.12loans, subsidies, grants, interest rate subsidies, or assistance in any form for up to 15,000 194.13square feet of any separately owned commercial facility located within the municipal 194.14jurisdiction of a small city, if the revenues derived from increments are spent only to 194.15assist the facility directly or for administrative expenses, the assistance is necessary to 194.16develop the facility, and all of the increments, except those for administrative expenses, 194.17are spent only for activities within the district.194.18    (c) A city is a small city for purposes of this subdivision if the city was a small city 194.19in the year in which the request for certification was made and applies for the rest of 194.20the duration of the district, regardless of whether the city qualifies or ceases to qualify 194.21as a small city.194.22    (d) Notwithstanding the requirements of paragraph (a) and the finding requirements 194.23of section 469.174, subdivision 12, tax increments from an economic development district 194.24may be used to provide improvements, loans, subsidies, grants, interest rate subsidies, or 194.25assistance in any form to developments consisting of buildings and ancillary facilities, if 194.26all the following conditions are met:194.27    (1) the municipality finds that the project will create or retain jobs in this state, 194.28including construction jobs, and that construction of the project would not have 194.29commenced before July 1, 2012, without the authority providing assistance under the 194.30provisions of this paragraph;194.31    (2) construction of the project begins no later than July 1, 2012;194.32    (3) the request for certification of the district is made no later than June 30, 2012; and194.33    (4) for development of housing under this paragraph, the construction must begin 194.34before January 1, 2012.195.1    The provisions of this paragraph may not be used to assist housing that is developed 195.2to qualify under section 469.1761, subdivision 2 or 3, or similar requirements of other law, 195.3if construction of the project begins later than July 1, 2011.195.4EFFECTIVE DATE.This section is effective for districts for which the request for 195.5certification was made after June 30, 2012.195.6    Sec. 4. Minnesota Statutes 2012, section 469.176, subdivision 4g, is amended to read:195.7    Subd. 4g. General government use prohibited. (a) Tax increments may not be 195.8used to circumvent existing levy limit law.195.9    (b) No tax increment from any district may be used for the acquisition, construction, 195.10renovation, operation, or maintenance of a building to be used primarily and regularly 195.11for conducting the business of a municipality, county, school district, or any other local 195.12unit of government or the state or federal government. This provision does not prohibit 195.13the use of revenues derived from tax increments for the construction or renovation of 195.14a parking structure.195.15    (c)(1) Tax increments may not be used to pay for the cost of public improvements, 195.16equipment, or other items, if:195.17    (i) the improvements, equipment, or other items are located outside of the area of the 195.18tax increment financing district from which the increments were collected; and195.19    (ii) the improvements, equipment, or items that (A) primarily serve a decorative or 195.20aesthetic purpose, or (B) serve a functional purpose, but their cost is increased by more than 195.21100 percent as a result of the selection of materials, design, or type as compared with more 195.22commonly used materials, designs, or types for similar improvements, equipment, or items.195.23    (2) The provisions of this paragraph do not apply to expenditures related to the 195.24rehabilitation of historic structures that are:195.25    (i) individually listed on the National Register of Historic Places; or195.26    (ii) a contributing element to a historic district listed on the National Register 195.27of Historic Places.195.28EFFECTIVE DATE.This section is effective the day following final enactment for 195.29all tax increment financing districts, regardless of when the request for certification was 195.30made, but applies only to amounts spent after final enactment.195.31    Sec. 5. Minnesota Statutes 2012, section 469.176, subdivision 6, is amended to read:195.32    Subd. 6. Action required. (a) If, after four years from the date of certification of 195.33the original net tax capacity of the tax increment financing district pursuant to section 196.1469.177
         , no demolition, rehabilitation, or renovation of property or other site preparation, 196.2including qualified improvement of a street adjacent to a parcel but not installation 196.3of utility service including sewer or water systems, has been commenced on a parcel 196.4located within a tax increment financing district by the authority or by the owner of the 196.5parcel in accordance with the tax increment financing plan, no additional tax increment 196.6may be taken from that parcel, and the original net tax capacity of that parcel shall be 196.7excluded from the original net tax capacity of the tax increment financing district. If the 196.8authority or the owner of the parcel subsequently commences demolition, rehabilitation, 196.9or renovation or other site preparation on that parcel including qualified improvement of 196.10a street adjacent to that parcel, in accordance with the tax increment financing plan, the 196.11authority shall certify to the county auditor that the activity has commenced, and the 196.12county auditor shall certify the net tax capacity thereof as most recently certified by the 196.13commissioner of revenue and add it to the original net tax capacity of the tax increment 196.14financing district. The county auditor must enforce the provisions of this subdivision. The 196.15authority must submit to the county auditor evidence that the required activity has taken 196.16place for each parcel in the district. The evidence for a parcel must be submitted by 196.17February 1 of the fifth year following the year in which the parcel was certified as included 196.18in the district. For purposes of this subdivision, qualified improvements of a street are 196.19limited to (1) construction or opening of a new street, (2) relocation of a street, and (3) 196.20substantial reconstruction or rebuilding of an existing street.196.21(b) For districts which were certified on or after January 1, 2005, and before April 196.2220, 2009, the four-year period under paragraph (a) is increased to six years deemed to end 196.23on December 31, 2016.196.24EFFECTIVE DATE.This section is effective the day following final enactment 196.25and applies to districts certified on or after January 1, 2005, and before April 20, 2009.196.26    Sec. 6. Minnesota Statutes 2012, section 469.177, subdivision 1a, is amended to read:196.27    Subd. 1a. Original local tax rate. At the time of the initial certification of the 196.28original net tax capacity for a tax increment financing district or a subdistrict, the county 196.29auditor shall certify the original local tax rate that applies to the district or subdistrict. The 196.30original local tax rate is the sum of all the local tax rates, excluding that portion of the 196.31school rate attributable to the general education levy under section 126C.13, that apply 196.32to a property in the district or subdistrict. The local tax rate to be certified is the rate in 196.33effect for the same taxes payable year applicable to the tax capacity values certified as 196.34the district's or subdistrict's original tax capacity. The resulting tax capacity rate is the 196.35original local tax rate for the life of the district or subdistrict.197.1EFFECTIVE DATE.This section is effective for districts for which the request for 197.2certification is made after April 15, 2013.197.3    Sec. 7. Minnesota Statutes 2012, section 469.177, is amended by adding a subdivision 197.4to read:197.5    Subd. 1d.Original net tax capacity adjustment; homestead market value 197.6exclusion.(a) Upon approval by the municipality, by resolution, the authority may elect to 197.7reduce the original net tax capacity of a qualified district by the amount of the tax capacity 197.8attributable to the market value exclusion under section 273.13, subdivision 35, for taxes 197.9payable in the year preceding the election. The amount of the reduction may not reduce 197.10the original net tax capacity below zero.197.11    (b) For purposes of this subdivision, a qualified district means a tax increment 197.12financing district that satisfies the following conditions:197.13    (1) for taxes payable in 2011, the authority received a homestead market value credit 197.14reimbursement under section 273.1384 for the district of $10,000 or more;197.15    (2) for taxes payable in 2013, the reduction in captured tax capacity resulting from 197.16the market value exclusion for the district was equal to or greater than 1.75 percent of the 197.17district's captured tax capacity; and197.18    (3) either (i) the authority is permitted to expend increments on activities under the 197.19provisions of section 469.1763, subdivision 3, or an equivalent provision of special law 197.20on July 1, 2013, or (ii) the district's tax increments received for taxes payable in 2012 197.21exceeded the amount of debt service payments due during calendar year 2012 on bonds 197.22issued under section 469.178 to which the district's increments are pledged.197.23The calculation of the amount under clause (2) must reflect any adjustments to original 197.24net tax capacity made under subdivision 1, paragraphs (d) and (e), for the homestead 197.25market value exclusion.197.26    (c) The authority must notify the county auditor of its election under this section no 197.27later than July 1, 2014. Notifications made by July 1, 2013, are effective beginning for 197.28taxes payable in 2014, and notifications made after July 1, 2013, are effective beginning 197.29for taxes payable in 2015.197.30EFFECTIVE DATE.This section is effective the day following final enactment 197.31and applies to all tax increment financing districts regardless of when the request for 197.32certification was made.197.33    Sec. 8. Minnesota Statutes 2012, section 469.177, is amended by adding a subdivision 197.34to read:198.1    Subd. 1e.Adjustments; qualifying districts.(a) For any tax increment financing 198.2district that satisfies the requirements of paragraph (b), the original net tax capacity must 198.3be reduced by the full amount of the original net tax capacity or $20,000, whichever is less.198.4    (b) A tax increment financing district qualifies under this subdivision if it satisfies 198.5the following conditions:198.6    (1) the district was certified after January 1, 2011, and before January 1, 2012;198.7    (2) for assessment year 2012, at least 75 percent of the tax capacity of the district 198.8is class 4d property; and198.9    (3) for assessment year 2012, the average estimated market value is over $115,000 198.10per housing unit for the portion of the property that is class 4d.198.11(c) An authority or a property owner within a tax increment financing district must 198.12notify the county assessor of a district that qualifies under this subdivision by July 1, 2013.198.13(d) This subdivision expires on December 31, 2021.198.14EFFECTIVE DATE.This section is effective beginning for taxes payable in 2014.198.15    Sec. 9. Minnesota Statutes 2012, section 469.177, subdivision 9, is amended to read:198.16    Subd. 9. Distributions of excess taxes on captured net tax capacity. (a) If the 198.17amount of tax paid on captured net tax capacity exceeds the amount of tax increment, 198.18the county auditor shall distribute the excess, except increment attributable to the 198.19general education levy,  to the municipality, county, and school district as follows: each 198.20governmental unit's share of the excess equals198.21(1) the total amount of the excess for the tax increment financing district, multiplied by198.22(2) a fraction, the numerator of which is the current local tax rate of the governmental 198.23unit less the governmental unit's local tax rate for the year the original local tax rate for the 198.24district was certified (in no case may this amount be less than zero) and the denominator 198.25of which is the sum of the numerators for the municipality, county, and school district.198.26If the entire increase in the local tax rate is attributable to a taxing district, other than 198.27the municipality, county, or school district, then the excess must be distributed to the 198.28municipality, county, and school district in proportion to their respective local tax rates.198.29(b) The amounts distributed shall be deducted in computing the levy limits of the 198.30taxing district for the succeeding taxable year.198.31(c) In the case of distributions to a school district, the county auditor shall report 198.32amounts distributed to the commissioner of education in the same manner as provided 198.33for excess increments under section 
         469.176, subdivision 2, and the distribution shall be 198.34deducted from the school district's state aid payments and levy limitation according to 198.35section 
         127A.49, subdivision 3.199.1(d) The amount of taxes attributable to imposing the general education levy under 199.2section 126C.13 must be returned to the school district within which the tax increment 199.3financing district is located.199.4EFFECTIVE DATE.This section is effective for districts for which the request for 199.5certification is made after April 15, 2013.199.6    Sec. 10. Minnesota Statutes 2012, section 473F.08, is amended by adding a subdivision 199.7to read:199.8    Subd. 3c.Mall of America.(a) When computing the net tax capacity under section 199.9473F.05, the Hennepin County auditor shall exclude the captured tax capacity of Tax 199.10Increment Financing Districts No. 1-C and No. 1-G in the city of Bloomington.199.11    (b) Notwithstanding the provisions of subdivision 2, paragraph (a), the 199.12commercial-industrial contribution percentage for the city of Bloomington is the 199.13contribution net tax capacity divided by the total net tax capacity of commercial-industrial 199.14property in the city, excluding any commercial-industrial property that is captured tax 199.15capacity of Tax Increment Financing Districts No. 1-C and No. 1-G.199.16    (c) The property taxes to be paid on commercial-industrial tax capacity that is 199.17included in the captured tax capacity of Tax Increment Financing Districts No. 1-C and 199.18No. 1-G in the city of Bloomington must be determined as described in subdivision 6, 199.19except that the portion of the tax that is based on the areawide tax rate is to be treated 199.20as tax increment under section 469.176.199.21    (d) The provisions of this subdivision take effect only if the clerk of the city of 199.22Bloomington certifies to the Hennepin County auditor that the city has entered into a 199.23binding written agreement with the Metropolitan Council to repair and restore, or to 199.24replace, the old Cedar Avenue bridge for use by bicycle commuters and recreational users.199.25    (e) This subdivision expires on the earliest of the following dates:199.26    (1) when the tax increment financing districts have been decertified in 2024 or 2035, 199.27as provided by section 22, subdivision 2 or 4; or199.28    (2) on January 1, 2014, if the city clerk fails to make the certification provided in 199.29paragraph (d) or if the city fails to file its local approval of section 23 with the secretary 199.30of state by December 31, 2013.199.31EFFECTIVE DATE.This section is effective beginning for property taxes payable 199.32in 2014.199.33    Sec. 11. Laws 2008, chapter 366, article 5, section 26, is amended to read:200.1    Sec. 26. BLOOMINGTON TAX INCREMENT FINANCING; FIVE-YEAR 200.2RULE.200.3    (a) The requirements of Minnesota Statutes, section 
         469.1763, subdivision 3, that 200.4activities must be undertaken within a five-year period from the date of certification of 200.5a tax increment financing district, are increased to a ten-year 15-year period for the 200.6Port Authority of the City of Bloomington's Tax Increment Financing District No. 1-I, 200.7Bloomington Central Station.200.8    (b) Notwithstanding the provisions of Minnesota Statutes, section 469.176, or any 200.9other law to the contrary, the city of Bloomington and its port authority may extend the 200.10duration limits of the district for a period through December 31, 2039.200.11    (c) Effective for taxes payable in 2014, tax increment for the district must be 200.12computed using the current local tax rate, notwithstanding the provisions of Minnesota 200.13Statutes, section 469.177, subdivision 1a.200.14EFFECTIVE DATE.Paragraphs (a) and (c) are effective upon compliance by 200.15the governing body of the city of Bloomington with the requirements of Minnesota 200.16Statutes, section 645.021, subdivision 3. Paragraph (b) is effective upon compliance by 200.17the governing bodies of the city of Bloomington, Hennepin County, and Independent 200.18School District No. 271 with the requirements of Minnesota Statutes, sections 469.1782, 200.19subdivision 2, and 645.021, subdivision 3.200.20    Sec. 12. Laws 2008, chapter 366, article 5, section 34, as amended by Laws 2009, 200.21chapter 88, article 5, section 11, is amended to read:200.22    Sec. 34. CITY OF OAKDALE; ORIGINAL TAX CAPACITY PARCELS 200.23DEEMED OCCUPIED. 200.24    (a) The provisions of this section apply to redevelopment tax increment financing 200.25districts created by the Housing and Redevelopment Authority in and for the city of 200.26Oakdale in the areas comprised of the parcels with the following parcel identification 200.27numbers: (1) 3102921320053; 3102921320054; 3102921320055; 3102921320056; 200.283102921320057; 3102921320058; 3102921320062; 3102921320063; 3102921320059; 200.293102921320060; 3102921320061; 3102921330005; and 3102921330004; and (2) 200.302902921330001 and 2902921330005.200.31    (b) For a district subject to this section, the Housing and Redevelopment Authority 200.32may, when requesting certification of the original tax capacity of the district under 200.33Minnesota Statutes, section 469.177, elect to have the original tax capacity of the district 200.34be certified as the tax capacity of the land.201.1    (c) The authority to request certification of a district under this section expires on 201.2July 1, 2013.201.3    (a) Parcel numbers 3102921320054, 3102921320055, 3102921320056, 201.43102921320057, 3102921320061, and 3102921330004 are deemed to meet the 201.5requirements of Minnesota Statutes, section 469.174, subdivision 10, paragraph (d), 201.6notwithstanding any contrary provisions of that paragraph, if the following conditions 201.7are met:201.8    (1) a building located on any part of each of the specified parcels was demolished after 201.9the Housing and Redevelopment Authority for the city of Oakdale adopted a resolution 201.10under Minnesota Statutes, section 469.174, subdivision 10, paragraph (d), clause (3);201.11    (2) the building was removed either by the authority, by a developer under a 201.12development agreement with the Housing and Redevelopment Authority for the city of 201.13Oakdale, or by the owner of the property without entering into a development agreement 201.14with the Housing and Redevelopment Authority for the city of Oakdale; and201.15    (3) the request for certification of the parcel as part of a district is filed with the 201.16county auditor by December 31, 2017.201.17    (b) The provisions of this section allow an election by the Housing and 201.18Redevelopment Authority for the city of Oakdale for the parcels deemed occupied under 201.19paragraph (a), notwithstanding the provisions of Minnesota Statutes, sections 469.174, 201.20subdivision 10, paragraph (d), and 469.177, subdivision 1, paragraph (f).201.21    (c) The city may elect, in the tax increment financing plan, to collect increment from 201.22a redevelopment district created under the provisions of this section for an additional ten 201.23years beyond the limit in Minnesota Statutes, section 469.176, subdivision 1b.201.24EFFECTIVE DATE.This section is effective upon compliance by the governing 201.25body of the city of Oakdale with the requirements of Minnesota Statutes, section 645.021, 201.26subdivision 3, except that the provisions of paragraph (c) are effective only upon 201.27compliance with Minnesota Statutes, section 469.1782, subdivision 2, by Ramsey County 201.28and Independent School District No. 622.201.29    Sec. 13. Laws 2010, chapter 216, section 55, is amended to read:201.30    Sec. 55. OAKDALE; TAX INCREMENT FINANCING DISTRICT.201.31    Subdivision 1. Duration of district. Notwithstanding the provisions of Minnesota 201.32Statutes, section 
         469.176, subdivision 1b, the city of Oakdale may collect tax increments 201.33from Tax Increment Financing District No. 6 (Bergen Plaza) through December 31, 2024201.34 2040, subject to the conditions described in subdivision 2.202.1    Subd. 2. Conditions for extension. (a) Subdivision 1 applies only if the following 202.2conditions are met:202.3    (1) by July 1, 2011, the city of Oakdale has entered into a development agreement 202.4with a private developer for development or redevelopment of all or a substantial part of 202.5the area parcels described in clause (2); and202.6    (2) by November 1, 2011, the city of Oakdale or a private developer commences 202.7construction of streets, traffic improvements, water, sewer, or related infrastructure that 202.8serves one or both of the parcels with the following parcel identification numbers: 202.92902921330001 and 2902921330005. For the purposes of this section, construction 202.10commences upon grading or other visible improvements that are part of the subject 202.11infrastructure.202.12    (b) All tax increments received by the city of Oakdale under subdivision 1 after 202.13December 31, 2016, must be used only to pay costs that are both:202.14    (1) related to redevelopment of the parcels specified in this subdivision or 202.15parcel numbers 3102921320053, 3102921320054, 3102921320055, 3102921320056, 202.163102921320057, 3102921320058, 3102921320059, 3102921320060, 3102921320061, 202.173102921320062, 3102921320063, 3102921330004, and 3102921330005, including, 202.18without limitation, any of the infrastructure referenced in this subdivision that serves 202.19any of the referenced parcels; and 202.20    (2) otherwise eligible under law to be paid with increments from the specified tax 202.21increment financing district, except the authority under this clause does not apply to 202.22increments collected after the conclusion of the duration limit under general law.202.23EFFECTIVE DATE.This section is effective upon compliance by the governing 202.24body of the city of Oakdale with the requirements of Minnesota Statutes, section 645.021, 202.25subdivision 3, except that the amendments to subdivision 1 are effective only upon 202.26compliance with Minnesota Statutes, section 469.1782, subdivision 2, by Ramsey County 202.27and Independent School District No. 622.202.28    Sec. 14. ST. CLOUD; TAX INCREMENT FINANCING.202.29    The request for certification of Tax Increment Financing District No. 2, commonly 202.30referred to as the Norwest District, in the city of St. Cloud is deemed to have been made 202.31on or after August 1, 1979, and before July 1, 1982. Revenues derived from tax increment 202.32for that district must be treated for purposes of any law as revenue of a tax increment 202.33financing district for which the request for certification was made during that time period.203.1EFFECTIVE DATE.This section is effective upon approval by the governing 203.2body of the city of St. Cloud and compliance with Minnesota Statutes, section 645.021, 203.3subdivision 3.203.4    Sec. 15. CITY OF GLENCOE; TAX INCREMENT FINANCING DISTRICT 203.5EXTENSION.203.6    Subdivision 1.Duration of district.Notwithstanding the provisions of Minnesota 203.7Statutes, section 469.176, subdivision 1b, paragraph (a), clause (4), or any other law to the 203.8contrary, the city of Glencoe may collect tax increments from Tax Increment Financing 203.9District No. 4 (McLeod County District No. 007) through December 31, 2023, subject to 203.10the conditions in subdivision 2.203.11    Subd. 2.Exclusive use of revenues.(a) All tax increments derived from Tax 203.12Increment Financing District No. 4 (McLeod County District No. 007) that are collected 203.13after December 31, 2013, must be used only to pay debt service on or to defease bonds that 203.14were outstanding on January 1, 2013 and that were issued to finance improvements serving:203.15    (1) Tax Increment Financing District No. 14 (McLeod County District No. 033) 203.16(Downtown);203.17    (2) Tax Increment Financing District No. 15 (McLeod County District No. 035) 203.18(Industrial Park); and203.19    (3) benefited properties as further described in proceedings related to the city's series 203.202007A bonds, dated September 1, 2007, and any bonds issued to refund those bonds.203.21    (b) Increments may also be used to pay debt service on or to defease bonds issued to 203.22refund the bonds described in paragraph (a), if the refunding bonds do not increase the 203.23present value of debt service due on the refunded bonds when the refunding is closed.203.24    (c) When the bonds described in paragraphs (a) and (b) have been paid or defeased, 203.25the district must be decertified and any remaining increment returned to the city, county, 203.26and school district as provided in Minnesota Statutes, section 469.176, subdivision 2, 203.27paragraph (c), clause (4).203.28EFFECTIVE DATE.This section is effective upon compliance by the governing 203.29bodies of the city of Glencoe, McLeod County, and Independent School District No. 203.302859 with the requirements of Minnesota Statutes, sections 469.1782, subdivision 2, and 203.31645.021, subdivision 3.203.32    Sec. 16. CITY OF ELY; TAX INCREMENT FINANCING.204.1    Subdivision 1.Extension of district.Notwithstanding Minnesota Statutes, section 204.2469.176, subdivision 1b, or any other law to the contrary, the city of Ely may collect 204.3tax increment from Tax Increment Financing District No. 1 through December 31, 204.42021. Increments from the district may only be used to pay binding obligations and 204.5administrative expenses.204.6    Subd. 2.Binding obligations.For purposes of this section, "binding obligations" 204.7means the binding contractual or debt obligation of Tax Increment Financing District 204.8No. 1 entered into before January 1, 2013.204.9    Subd. 3.Expenditures outside district.Notwithstanding Minnesota Statutes, 204.10section 469.1763, subdivision 2, the governing body of the city of Ely may elect to 204.11transfer revenues derived from increments from its Tax Increment Financing District No. 204.123 to the tax increment account established under Minnesota Statutes, section 469.177, 204.13subdivision 5, for Tax Increment Financing District No. 1. The amount that may be 204.14transferred is limited to the lesser of:204.15    (1) $168,000; or204.16    (2) the total amount due on binding obligations and outstanding on that date, less the 204.17amount of increment collected by Tax Increment Financing District No. 1 after December 204.1831, 2012, and administrative expenses of Tax Increment Financing District No. 1 incurred 204.19after December 31, 2012.204.20EFFECTIVE DATE.This section is effective upon approval by the governing 204.21bodies of the city of Ely, St. Louis County, and Independent School District No. 696 with 204.22the requirements of Minnesota Statutes, sections 469.1782, subdivision 2, and 645.021, 204.23subdivision 3. 204.24    Sec. 17. DAKOTA COUNTY COMMUNITY DEVELOPMENT AGENCY; TAX 204.25INCREMENT FINANCING DISTRICT.204.26    Subdivision 1.Authorization.Notwithstanding the provisions of any other law, 204.27the Dakota County Community Development Agency may establish a redevelopment tax 204.28increment financing district comprised of the properties that (1) were included in the CDA 204.2910 Robert Street and Smith Avenue district in the city of West St. Paul, and (2) were not 204.30decertified before July 1, 2012. The district created under this section terminates no later 204.31than December 31, 2023.204.32    Subd. 2.Special rules.The requirements for qualifying a redevelopment district 204.33under Minnesota Statutes, section 469.174, subdivision 10, do not apply to parcels located 205.1within the district. Minnesota Statutes, section 469.176, subdivision 4j, do not apply to the 205.2district. The original tax capacity of the district is $93,239.205.3    Subd. 3.Authorized expenditures.Tax increment from the district may be 205.4expended to pay for any eligible activities authorized by Minnesota Statutes, chapter 469, 205.5within the redevelopment area that includes the district provided that the boundaries of the 205.6redevelopment area may not be expanded to add new area after April 1, 2013. All such 205.7expenditures are deemed to be activities within the district under Minnesota Statutes, 205.8section 469.1763, subdivisions 2 and 4.205.9    Subd. 4.Adjusted net tax capacity.The captured tax capacity of the district must 205.10be included in the adjusted net tax capacity of the city, county, and school district for the 205.11purposes of determining local government aid, education aid, and county program aid. 205.12The county auditor shall report to the commissioner of revenue the amount of the captured 205.13tax capacity for the district at the time the assessment abstracts are filed.205.14EFFECTIVE DATE.This section is effective upon compliance by the governing 205.15body of the Dakota County Community Development Agency with the requirements of 205.16Minnesota Statutes, section 645.021, subdivision 3.205.17    Sec. 18. CITY OF APPLE VALLEY; TAX INCREMENT FINANCING 205.18DISTRICT.205.19    Subdivision 1.Definitions.(a) For the purposes of this section, the following terms 205.20have the meanings given to them.205.21(b) "City" means the city of Apple Valley.205.22(c) "Project area" means the following parcels: parcel numbers 01-03500-25-010, 205.2301-03500-03-011, 01-03500-02-010, 01-03500-52-011, 01-03500-78-011, 205.2401-03500-77-014, 01-03500-75-010, 01-03400-05-050, 205.25(d) "Soil deficiency district" means a type of tax increment financing district 205.26consisting of a portion of the project area in which the city finds by resolution that the 205.27following conditions exist:205.28(1) unusual terrain or soil deficiencies that occurred over 70 percent of the acreage in 205.29the district require substantial filling, grading, or other physical preparation for use; and205.30(2) the estimated cost of the physical preparation under clause (1), but excluding 205.31costs directly related to roads as defined in Minnesota Statutes, section 160.01, and local 205.32improvements as described in Minnesota Statutes, sections 429.021, subdivision 1, other 206.1than clauses (8) to (10), and 430.01, exceeds the fair market value of the land before 206.2completion of the preparation.206.3    Subd. 2.Special rules.(a) If the city elects, upon the adoption of the tax increment 206.4financing plan for a district, the rules under this section apply to a redevelopment 206.5district, renewal and renovation district, soil condition district, or soil deficiency district 206.6established by the city or a development authority of the city in the project area. The city, 206.7or a development authority acting on its behalf, may establish one or more soils deficiency 206.8districts within the project area.206.9(b) Prior to or upon the adoption of the first tax increment plan subject to the special 206.10rules under this subdivision, the city must find by resolution that parcels consisting 206.11of at least 70 percent of the acreage of the project area, excluding street and railroad 206.12rights-of-way, are characterized by one or more of the following conditions:206.13(1) peat or other soils with geotechnical deficiencies that impair development of 206.14commercial buildings or infrastructure;206.15(2) soils or terrain that requires substantial filling in order to permit the development 206.16of commercial buildings or infrastructure;206.17(3) landfills, dumps, or similar deposits of municipal or private waste;206.18(4) quarries or similar resource extraction sites;206.19(5) floodway; and206.20(6) substandard buildings, within the meaning of Minnesota Statutes, section 206.21469.174, subdivision 10.206.22(c) For the purposes of paragraph (b), clauses (1) to (5), a parcel is characterized by 206.23the relevant condition if at least 60 percent of the area of the parcel contains the relevant 206.24condition. For the purposes of paragraph (b), clause (6), a parcel is characterized by 206.25substandard buildings if substandard buildings occupy at least 30 percent of the area 206.26of the parcel.206.27(d) The five-year rule under Minnesota Statutes, section 469.1763, subdivision 3, is 206.28extended to ten years for any district, and the period under Minnesota Statutes, section 206.29469.1763, subdivision 4, is extended to 11 years.206.30(e) Notwithstanding any provision to the contrary in Minnesota Statutes, section 206.31469.1763, subdivision 2, paragraph (a), not more than 80 percent of the total revenue 206.32derived from tax increments paid by properties in any district, measured over the life of 206.33the district, may be expended on activities outside the district but within the project area.206.34(f) For a soil deficiency district:206.35(1) increments may be collected through 20 years after the receipt by the authority of 206.36the first increment from the district; and207.1(2) except as otherwise provided in this subdivision, increments may be used only to:207.2(i) acquire parcels on which the improvements described in item (ii) will occur;207.3(ii) pay for the cost of correcting the unusual terrain or soil deficiencies and the 207.4additional cost of installing public improvements directly caused by the deficiencies; and207.5(iii) pay for the administrative expenses of the authority allocable to the district.207.6(g) The authority to approve tax increment financing plans to establish tax increment 207.7financing districts under this section expires December 31, 2022.207.8EFFECTIVE DATE.This section is effective upon compliance with Minnesota 207.9Statutes, section 645.021, subdivision 3.207.10    Sec. 19. CITY OF APPLE VALLEY; USE OF TAX INCREMENT FINANCING.207.11    Subdivision 1.Developments consisting of building and ancillary facilities.207.12    Notwithstanding Minnesota Statutes, section 469.176, subdivisions 4c and 4m, the city of 207.13Apple Valley may use tax increment financing to provide improvements, loans, subsidies, 207.14grants, interest rate subsidies, or assistance in any form to developments consisting of 207.15buildings and ancillary facilities, if all of the following conditions are met:207.16    (1) the city of Apple Valley finds that the project will create or retain jobs in 207.17Minnesota, including construction jobs;207.18    (2) the city of Apple Valley finds that construction of the project will not commence 207.19before July 1, 2014, without the use of tax increment financing;207.20    (3) the request for certification of the district is made no later than June 30, 2014;207.21    (4) construction of the project begins no later than July 1, 2014; and207.22    (5) for development of housing, construction of the project begins no later than 207.23December 31, 2013.207.24    Subd. 2.Extension of authority to spend tax increments.Notwithstanding the 207.25time limits in Minnesota Statutes, section 469.176, subdivision 4m, the city of Apple 207.26Valley has the authority to spend tax increments under Minnesota Statutes, section 207.27469.176, subdivision 4m, until December 31, 2014.207.28EFFECTIVE DATE.This section is effective upon approval by the governing 207.29body of the city of Apple Valley and timely compliance with Minnesota Statutes, section 207.30645.021, subdivision 3.207.31    Sec. 20. CITY OF MINNEAPOLIS; STREETCAR FINANCING.208.1    Subdivision 1.Definitions.(a) For purposes of this section, the following terms 208.2have the meanings given them.208.3    (b) "City" means the city of Minneapolis.208.4    (c) "County" means Hennepin County.208.5    (d) "District" means the areas certified by the city under subdivision 2 for collection 208.6of value capture taxes.208.7    (e) "Project area" means the area including one city block on either side of a streetcar 208.8line designated by the city to serve the downtown and adjacent neighborhoods of the city.208.9    Subd. 2.Authority to establish district.(a) The governing body of the city may, by 208.10resolution, establish a value capture district consisting of some or all of the taxable parcels 208.11located within one or more of the following areas of the city, as described in the resolution:208.12    (1) the area bounded by Nicollet Avenue on the west, 16th Street East on the south, 208.13First Avenue South on the east, and 14th Street East on the north;208.14    (2) the area bounded by Spruce Place on the west, 14th Street West on the south, 208.15LaSalle Avenue on the east, and Grant Street West on the north;208.16    (3) the area bounded by Nicollet Avenue or Mall on the west, Fifth Street South on 208.17the south, Marquette Avenue on the east, and Fourth Street South on the north;208.18    (4) the area bounded by First Avenue North on the west, Washington Avenue on the 208.19south, Hennepin Avenue on the east, and Second Street North on the north; and208.20(5) the area bounded by Fifth Street North East on the west, Central Avenue North 208.21East on the southeast, Sixth Street North East on the east, Hennepin Avenue East on the 208.22south, and First Avenue North East on the north.208.23    (b) The city may establish the district and the project area only after holding a public 208.24hearing on its proposed creation after publishing notice of the hearing and the proposal at 208.25least once not less than ten days nor more than 30 days before the date of the hearing.208.26    Subd. 3.Calculation of value capture district; administrative provisions.(a) If 208.27the city establishes a value capture district under subdivision 2, the city shall request the 208.28county auditor to certify the district for calculation of the district's tax revenues.208.29    (b) For purposes of calculating the tax revenues of the district, the county auditor 208.30shall treat the district as if it were a request for certification of a tax increment financing 208.31district under the provisions of Minnesota Statutes, section 469.177, subdivision 1, 208.32and shall calculate the tax revenues of the district for each year of its duration under 208.33subdivision 5 as equaling the amount of tax increment that would be computed by 208.34applying the provisions of Minnesota Statutes, section 469.177, subdivisions 1, 2, and 208.353, to determine captured tax capacity and multiplying by the current tax rate, excluding 209.1the state general tax rate. The city shall provide the county auditor with the necessary 209.2information to certify the district, including the option for calculating revenues derived 209.3from the areawide tax rate under Minnesota Statutes, chapter 473F.209.4    (c) The county auditor shall pay to the city at the same times provided for settlement 209.5of taxes and payment of tax increments the tax revenues of the district. The city must use 209.6the tax revenues as provided under subdivision 4.209.7    Subd. 4.Permitted uses of district tax revenues.(a) In addition to paying for 209.8reasonable administrative costs of the district, the city may spend tax revenues of the 209.9district for property acquisition, improvements, and equipment to be used for operations 209.10within the project area, along with related costs, for:209.11    (1) planning, design, and engineering services related to the construction of the 209.12streetcar line;209.13    (2) acquiring property for, constructing, and installing a streetcar line;209.14    (3) acquiring and maintaining equipment and rolling stock and related facilities, such 209.15as maintenance facilities, which need not be located in the project area;209.16    (4) acquiring, constructing, or improving transit stations; and209.17    (5) acquiring or improving public space, including the construction and installation 209.18of improvements to streets and sidewalks, decorative lighting and surfaces, and plantings 209.19related to the streetcar line.209.20    (b) The city may issue bonds or other obligations under Minnesota Statutes, chapter 209.21475, without an election, to fund acquisition or improvement of property of a capital 209.22nature authorized by this section, including any costs of issuance. The city may also issue 209.23bonds or other obligations to refund those bonds or obligations. Payment of principal 209.24and interest on the bonds or other obligations issued under this paragraph is a permitted 209.25use of the district's tax revenues.209.26    (c) Tax revenues of the district may not be used for the operation of the streetcar line.209.27    Subd. 5.Duration of the district.A district established under this section is limited 209.28to the lesser of (1) 25 years of tax revenues, or (2) the time necessary to collect tax revenues 209.29equal to the amount of the capital costs permitted under subdivision 4 or the amount needed 209.30to pay or defease bonds or other obligations issued under subdivision 4, whichever is later.209.31EFFECTIVE DATE.This section is effective the day following final enactment.209.32    Sec. 21. CITY OF MAPLEWOOD; TAX INCREMENT FINANCING 209.33DISTRICT; SPECIAL RULES.210.1    (a) If the city of Maplewood elects, upon the adoption of a tax increment financing 210.2plan for a district, the rules under this section apply to one or more redevelopment 210.3tax increment financing districts established by the city or the economic development 210.4authority of the city. The area within which the redevelopment tax increment districts may 210.5be created is parcel 362922240002 (the "parcel") or any replatted parcels constituting a 210.6part of the parcel and the adjacent rights-of-way. For purposes of this section, the parcel is 210.7the "3M Renovation and Retention Project Area" or "project area."210.8    (b) The requirements for qualifying redevelopment tax increment districts under 210.9Minnesota Statutes, section 469.174, subdivision 10, do not apply to the parcel, which is 210.10deemed eligible for inclusion in a redevelopment tax increment district.210.11    (c) The 90 percent rule under Minnesota Statutes, section 469.176, subdivision 210.124j, does not apply to the parcel.210.13    (d) The expenditures outside district rule under Minnesota Statutes, section 210.14469.1763, subdivision 2, does not apply; the five-year rule under Minnesota Statutes, 210.15section 469.1763, subdivision 3, is extended to ten years; and expenditures must only 210.16be made within the project area.210.17    (e) If, after one year from the date of certification of the original net tax capacity 210.18of the tax increment district, no demolition, rehabilitation, or renovation of property has 210.19been commenced on a parcel located within the tax increment district, no additional tax 210.20increment may be taken from that parcel, and the original net tax capacity of the parcel 210.21shall be excluded from the original net tax capacity of the tax increment district. If 3M 210.22Company subsequently commences demolition, rehabilitation, or renovation, the authority 210.23shall certify to the county auditor that the activity has commenced, and the county auditor 210.24shall certify the net tax capacity thereof as most recently certified by the commissioner 210.25of revenue and add it to the original net tax capacity of the tax increment district. The 210.26authority must submit to the county auditor evidence that the required activity has taken 210.27place for each parcel in the district.210.28    (f) The authority to approve a tax increment financing plan and to establish a tax 210.29increment financing district under this section expires December 31, 2018.210.30EFFECTIVE DATE.This section is effective upon approval by the governing 210.31body of the city of Maplewood and upon compliance with Minnesota Statutes, section 210.32645.021, subdivision 3.210.33    Sec. 22. CITY OF BLOOMINGTON; TAX INCREMENT FINANCING.211.1    Subdivision 1.Addition of property to Tax Increment Financing District 211.2No. 1-G.(a) Notwithstanding the provisions of Minnesota Statutes, section 469.175, 211.3subdivision 4, or any other law to the contrary, the governing bodies of the Port Authority 211.4of the city of Bloomington and the city of Bloomington may elect to eliminate the real 211.5property north of the existing building line on Lot 1, Block 1, Mall of America 7th 211.6Addition, exclusive of Lots 2 and 3 from Tax Increment Financing District No. 1-C 211.7within Industrial Development District No. 1 Airport South in the city of Bloomington, 211.8Minnesota, and expand the boundaries of Tax Increment Financing District No. 1-G 211.9to include that property. 211.10    (b) If the city elects to transfer parcels under this authority, the county auditor shall 211.11transfer the original tax capacity of the affected parcels from Tax Increment Financing 211.12District No. 1-C to Tax Increment Financing District No. 1-G.211.13    Subd. 2.Authority to extend duration limit; computation of increment.(a) 211.14Notwithstanding Minnesota Statutes, section 469.176, or Laws 1996, chapter 464, article 211.151, section 8, or any other law to the contrary, the city of Bloomington and its port authority 211.16may extend the duration limits of Tax Increment Financing Districts No. 1-C and No. 211.171-G through December 31, 2034.211.18    (b) Effective for property taxes payable in 2017 through 2034, the captured tax 211.19capacity of Tax Increment Financing District No. 1-C must be included in computing the 211.20tax rates of each local taxing district and the tax increment equals only the amount of tax 211.21computed under Minnesota Statutes, section 473F.08, subdivision 3c, paragraph (c).211.22    (c) Effective for property taxes payable in 2019 through 2034, the captured tax 211.23capacity of Tax Increment Financing District No. 1-G must be included in computing the 211.24tax rates of each local taxing district and the tax increment for the district equals only 211.25the amount of tax computed under Minnesota Statutes, section 473F.08, subdivision 211.263c, paragraph (c).211.27    Subd. 3.Treatment of increment.Increments received under the provisions 211.28of subdivision 2, paragraph (b) or (c), and Minnesota Statutes, section 473F.08, 211.29subdivision 3c, are deemed to be tax increments of Tax Increment Financing District No. 211.301-G, notwithstanding any law to the contrary, and without regard to whether they are 211.31attributable to captured tax capacity of Tax Increment Financing District No. 1-C.211.32    Subd. 4.Condition.The authority under this section expires and Tax Increment 211.33Financing Districts No. 1-C and No. 1-G must be decertified for taxes payable in 2024 211.34and thereafter, if the total estimated market value of improvements for parcels located in 212.1Tax Increment Financing District No. 1-G, as modified, do not exceed $100,000,000 212.2by taxes payable in 2023.212.3EFFECTIVE DATE.This section is effective upon compliance of the governing 212.4body of the city of Bloomington with the requirements of Minnesota Statutes, section 212.5645.021, subdivision 3, but only if the city enters into a binding written agreement with 212.6the Metropolitan Council to repair and restore, or to replace, the old Cedar Avenue bridge 212.7for use by bicycle commuters and  recreational users. This section is effective without 212.8approval of the county and school district under Minnesota Statutes, section 469.1782, 212.9subdivision 2. The legislature finds that the county and school district are not "affected 212.10local government units" within the meaning of Minnesota Statutes, section 469.1782, 212.11because the provision allowing extended collection of increment by the tax increment 212.12financing districts does not affect their tax bases and tax rates dissimilarly to other counties 212.13and school districts in the metropolitan area.212.14    Sec. 23. CITY OF BLOOMINGTON; OLD CEDAR AVENUE BRIDGE.212.15    (a) Notwithstanding any law to the contrary, the city of Bloomington shall transfer 212.16from the tax increment financing accounts for its Tax Increment Financing District No. 212.171-C and Tax Increment Financing District No. 1-G an amount equal to the tax increment 212.18for each district that is computed under the provisions of Minnesota Statutes, section 212.19473F.08, subdivision 3c, for taxes payable in 2014 to an account or fund established for 212.20the repair, restoration, or replacement of the Old Cedar Avenue bridge for use by bicycle 212.21commuters and recreational users. The city is authorized to and must use the transferred 212.22funds to complete the repair, renovation, or replacement of the bridge.212.23    (b) No signs, plaques, or markers acknowledging or crediting donations for, 212.24sponsorships of, or naming rights may be posted on or in the vicinity of the Old Cedar 212.25Avenue bridge.212.26EFFECTIVE DATE.This section is effective upon compliance by the city of 212.27Bloomington with the requirements of Minnesota Statutes, section 645.021, subdivision 3.212.28ARTICLE 10212.29DESTINATION MEDICAL CENTER212.30    Section 1. Minnesota Statutes 2012, section 13.792, is amended to read:212.3113.792 PRIVATE DONOR GIFT DATA.212.32The following data maintained by the Minnesota Zoological Garden, the University 212.33of Minnesota, the Minnesota State Colleges and Universities, the Regional Parks 213.1Foundation of the Twin Cities, State Services for the Blind, the Destination Medical 213.2Center Corporation established pursuant to section 469.41, and any related entity subject 213.3to chapter 13 are classified as private or nonpublic:213.4(1) research information about prospects and donors gathered to aid in determining 213.5appropriateness of solicitation and level of gift request;213.6(2) specific data in prospect lists that would identify prospects to be solicited, dollar 213.7amounts to be requested, and name of solicitor;213.8(3) portions of solicitation letters and proposals that identify the prospect being 213.9solicited and the dollar amount being requested;213.10(4) letters, pledge cards, and other responses received from donors regarding 213.11prospective gifts in response to solicitations;213.12(5) portions of thank-you letters and other gift acknowledgment communications 213.13that would identify the name of the donor and the specific amount of the gift, pledge, 213.14or pledge payment;213.15(6) donor financial or estate planning information, or portions of memoranda, letters, 213.16or other documents commenting on any donor's financial circumstances; and213.17(7) data detailing dates of gifts, payment schedule of gifts, form of gifts, and specific 213.18gift amounts made by donors.213.19Names of donors and gift ranges are public data.213.20    Sec. 2. Minnesota Statutes 2012, section 297A.71, is amended by adding a subdivision 213.21to read:213.22    Subd. 48.Construction materials, public infrastructure related to the 213.23destination medical center.Materials and supplies used in, and equipment incorporated 213.24into, the construction and improvement of publicly owned buildings and infrastructure 213.25included in the development plan adopted under section 469.43, and financed with public 213.26funds, are exempt.213.27EFFECTIVE DATE.This section is effective for sales and purchases made after 213.28June 30, 2015, and before July 1, 2049.213.29    Sec. 3. [469.40] DEFINITIONS.213.30    Subdivision 1.Application.For the purposes of sections 469.40 to 469.47, the 213.31terms defined in this section have the meanings given them.213.32    Subd. 2.City."City" means the city of Rochester.213.33    Subd. 3.County."County" means Olmsted County.214.1    Subd. 4.Destination Medical Center Corporation, corporation, DMCC.214.2"Destination Medical Center Corporation," "corporation," or "DMCC" means the 214.3nonprofit corporation created by the city as provided in section 469.41, and organized 214.4under chapter 317A.214.5    Subd. 5.Destination Medical Center Development District."Destination medical 214.6center development district" or "development district" means a geographic area in the city 214.7identified in the DMCC development plan in which public infrastructure projects are 214.8implemented.214.9    Subd. 6.Development plan."Development plan" means the plan adopted by 214.10the DMCC under section 469.43.214.11    Subd. 7.Financial interest."Financial interest" means a person's direct or indirect 214.12ownership or investment interest or compensation arrangement, whether through business, 214.13investment, or family, including spouse, children and stepchildren, and other relatives 214.14living with the person, as follows:214.15(1) ownership or investment interest in the development, acquisition, or construction 214.16of a project in the development district;214.17(2) compensation arrangement with respect to the development, acquisition, or 214.18construction of a project in the development district; or214.19(3) potential ownership or investment interest in, or compensation arrangement with 214.20respect to, the development, acquisition, or construction of a project in the development 214.21district.214.22    Subd. 8.Medical business entity."Medical business entity" means a medical 214.23business entity with its principal place of business in the city that, as of the effective date 214.24of this section, together with all business entities of which it is the sole member or sole 214.25shareholder, collectively employs more than 30,000 persons in the state.214.26    Subd. 9.Nonprofit economic development agency, agency."Nonprofit economic 214.27development agency" or "agency" means the nonprofit agency required under section 214.28469.43 to provide experience and expertise to the DMCC for purposes of developing and 214.29marketing the destination medical center.214.30    Subd. 10.Project."Project" means a project to implement the development plan, 214.31whether public or private.214.32    Subd. 11.Public infrastructure project.(a) "Public infrastructure project" means 214.33a project financed in part or in whole with public money in order to support the medical 214.34business entity's development plans, as identified in the DMCC development plan. A 214.35public infrastructure project may:214.36(1) acquire real property and other assets associated with the real property;215.1(2) demolish, repair, or rehabilitate buildings;215.2(3) remediate land and buildings as required to prepare the property for acquisition 215.3or development;215.4(4) install, construct, or reconstruct elements of public infrastructure required to 215.5support the overall development of the destination medical center development district 215.6including, but not limited to, streets, roadways, utilities systems and related facilities, 215.7utility relocations and replacements, network and communication systems, streetscape 215.8improvements, drainage systems, sewer and water systems, subgrade structures and 215.9associated improvements, landscaping, façade construction and restoration, wayfinding 215.10and signage, and other components of community infrastructure;215.11(5) acquire, construct or reconstruct, and equip parking facilities and other facilities 215.12to encourage intermodal transportation and public transit;215.13(6) install, construct or reconstruct, furnish, and equip parks, cultural, and 215.14recreational facilities, facilities to promote tourism and hospitality, conferencing and 215.15conventions, broadcast and related multimedia infrastructure;215.16(7) make related site improvements including, without limitation, excavation, 215.17earth retention, soil stabilization and correction, and site improvements to support the 215.18destination medical center development district;215.19(8) prepare land for private development and to sell or lease land;215.20(9) costs of providing relocation benefits to occupants of acquired properties; and215.21(10) construct and equip all or a portion of one or more suitable structures on land 215.22owned by the city for sale or lease to private development; provided, however, that the 215.23portion of any structure directly financed by the city as a public infrastructure project must 215.24not be sold or leased to a medical business entity.215.25(b) A public infrastructure project is not a business subsidy under section 116J.993.215.26    Subd. 12.Year."Year" means a calendar year, except where otherwise provided.215.27    Sec. 4. [469.41] DESTINATION MEDICAL CENTER CORPORATION 215.28ESTABLISHED.215.29    Subdivision 1.DMCC created.The city must establish a destination medical 215.30center corporation as a nonprofit corporation under chapter 317A to provide the city with 215.31expertise in preparing and implementing the development plan to establish the city as a 215.32destination medical center. Except as provided in sections 469.40 to 469.47, the nonprofit 215.33corporation is not subject to laws governing the city.215.34    Subd. 2.Membership; quorum.(a) The corporation's governing board consists 215.35of eight members appointed, as follows:216.1(1) the mayor of the city, or the mayor's designee, subject to approval by the city 216.2council;216.3(2) the city council president, or the city council president's designee, subject 216.4to approval by the city council;216.5    (3) the chair or member of the county board, appointed by the county board;216.6    (4) a representative of the medical business entity appointed by and serving at the 216.7pleasure of the medical business entity; and216.8    (5) four members appointed by the governor, subject to confirmation by the senate.216.9(b) Appointing authorities must make their respective appointments as soon as 216.10practicable after the effective date of this section, but no later than 60 days after enactment 216.11of this section. 216.12(c) A quorum of the board is six members.216.13    Subd. 3.Terms.(a) A member first appointed after the effective date of this section 216.14under subdivision 2, paragraph (a), clauses (1), (2), and (3), serves for a term coterminous 216.15with the term of the elected office, but may be reappointed.216.16    (b) Two members first appointed after the effective date of this section under 216.17subdivision 2, paragraph (a), clause (5), serve from the date of appointment until the first 216.18Tuesday after the first Monday in January 2017, and two members first appointed after the 216.19effective date of this section under subdivision 2, paragraph (a), clause (5), serve from 216.20the date of appointment until the first Tuesday after the first Monday in January 2020. 216.21Thereafter, members appointed by the governor serve six-year terms.216.22    Subd. 4.Vacancies.A vacancy occurs as provided in section 351.02 or upon 216.23a member's removal under subdivision 7. A vacancy on the board must be filled by 216.24the appointing authority for the balance of the term in the same manner as a regular 216.25appointment.216.26    Subd. 5.Chair.The board must elect a chair from among the governor's appointees. 216.27The governor must convene the first meeting within 30 days of completion of all 216.28appointments to the board. 216.29    Subd. 6.Pay.Members must be compensated as provided in section 15.0575, 216.30subdivision 3. For the purposes of this subdivision, the member representing the medical 216.31business entity shall be treated as if an employee of a political subdivision. All money 216.32paid for compensation or reimbursement must be paid out of the corporation's budget.216.33    Subd. 7.Removal for cause.A member may be removed by the board for 216.34inefficiency, neglect of duty, or misconduct in office. A member may be removed only 216.35after a hearing of the board. A copy of the charges must be given to the board member at 216.36least ten days before the hearing. The board member must be given an opportunity to be 217.1heard in person or by counsel at the hearing. When written charges have been submitted 217.2against a board member, the board may temporarily suspend the member. If the board finds 217.3that those charges have not been substantiated, the board member must be immediately 217.4reinstated. If a board member is removed, a record of the proceedings, together with the 217.5charges and findings, must be filed with the office of the appointing authority.217.6    Subd. 8.Open meeting law; data practices.Meetings of the corporation and any 217.7committee or subcommittee of the corporation are subject to the open meeting law in 217.8chapter 13D. The corporation is a government entity for purposes of chapter 13.217.9    Subd. 9.Conflicts of interest.Except for the member appointed by the medical 217.10business entity, a member must not be a director, officer, or employee of the medical 217.11business entity. A member must not participate in or vote on a decision of the corporation 217.12relating to any project authorized by or under consideration by the corporation in which 217.13the member has either a direct or indirect financial interest. No member may serve as a 217.14lobbyist, as defined under section 10A.01, subdivision 21.217.15    Subd. 10.Public official.A member of the corporation is a public official, as 217.16defined in section 10A.01, subdivision 35.217.17    Subd. 11.Powers.The corporation may exercise any other powers that are 217.18granted by its articles of incorporation and bylaws to the extent that those powers are not 217.19inconsistent with the provisions of sections 469.40 to 469.47.217.20    Subd. 12.Contract for services.(a) The corporation may contract for the services 217.21of the nonprofit economic development agency, financial advisors, other consultants, 217.22agents, public accountants, legal counsel, and other persons needed to perform its duties 217.23and exercise its powers. The corporation may contract with the city or county to provide 217.24administrative, clerical, and accounting services to the corporation.217.25(b) The corporation must contract with the nonprofit agency for the services 217.26enumerated in section 469.43, subdivision 6, paragraph (a). The requirement to contract 217.27with the nonprofit agency does not limit the corporation's authority to contract with other 217.28providers for the services.217.29    Subd. 13.DMCC approval of projects.A project must be approved by the 217.30corporation before it is proposed to the city. The corporation must review the project 217.31proposed for consistency with the adopted development plan. 217.32    Subd. 14.Dissolution.The city must provide for the terms for dissolution of the 217.33corporation in the articles of incorporation.217.34    Sec. 5. [469.42] OFFICERS; DUTIES; ORGANIZATIONAL MATTERS.218.1    Subdivision 1.Bylaws, rules, seal.The corporation may adopt bylaws and rules of 218.2procedure and may adopt an official seal.218.3    Subd. 2.Officers.The corporation must annually elect a treasurer. The chair must 218.4appoint a secretary and assistant treasurer. The secretary and assistant treasurer need 218.5not, but may, be members of the board.218.6    Subd. 3.Duties and powers.The officers have the usual duties and powers of their 218.7offices. They may be given other duties and powers by the corporation. The corporation 218.8must establish and maintain a Web site.218.9    Subd. 4.Treasurer's duties.The treasurer:218.10(1) must receive and is responsible for corporation money;218.11(2) is responsible for the acts of the assistant treasurer;218.12(3) must disburse corporation money by check or electronic procedures;218.13(4) must keep an account of the source of all receipts, and of the nature, purpose, and 218.14authority of all disbursements; and218.15(5) must file the corporation's detailed financial statement with its secretary at least 218.16once a year at times set by the authority.218.17    Subd. 5.Secretary.The secretary must perform duties as required by the board.218.18    Subd. 6.Assistant treasurer.The assistant treasurer has the powers and duties of 218.19the treasurer if the treasurer is absent or disabled.218.20    Sec. 6. [469.43] DEVELOPMENT PLAN.218.21    Subdivision 1.Development plan; adoption by DMCC; notice; findings.(a) The 218.22corporation, working with the city and the nonprofit economic development agency, must 218.23prepare and adopt a development plan. The corporation must hold a public hearing before 218.24adopting a development plan. At least 60 days before the hearing, the corporation must 218.25make copies of the proposed plan available to the public at the corporation and city offices 218.26during normal business hours, on the corporation's and city's Web site, and as otherwise 218.27determined appropriate by the corporation. At least ten days before the hearing, the 218.28corporation must publish notice of the hearing in the official newspaper of the city. The 218.29development plan may not be adopted, unless the corporation finds, by resolution, that:218.30(1) the plan provides an outline for the development of the city as a destination 218.31medical center, and the plan is sufficiently complete, including the identification of planned 218.32and anticipated projects, to indicate its relationship to definite state and local objectives;218.33(2) the proposed development affords maximum opportunity, consistent with the 218.34needs of the city, county, and state, for the development of the city by private enterprise 218.35as a destination medical center;219.1(3) the proposed development conforms to the general plan for the development of 219.2the city and is consistent with the city comprehensive plan;219.3(4) the plan includes:219.4(i) strategic planning consistent with a destination medical center in the core areas of 219.5commercial research and technology, learning environment, hospitality and convention, 219.6sports and recreation, livable communities, including mixed-use urban development 219.7and neighborhood residential development, retail/dining/entertainment, and health and 219.8wellness;219.9(ii) estimates of short- and long-range fiscal and economic impacts;219.10(iii) a framework to identify and prioritize short- and long-term public investment 219.11and public infrastructure project development and to facilitate private investment 219.12and development, including the criteria and process for evaluating and underwriting 219.13development proposals;219.14(iv) land use planning;219.15(v) transportation and transit planning;219.16(vi) operational planning required to support the medical center development 219.17district; and219.18(vii) ongoing market research plans; and219.19(5) the city has approved the plan.219.20(b) The identification of planned and anticipated projects under paragraph (a), clause 219.21(1), must give priority to projects that will pay wages at least equal to the basic cost of living 219.22wage as calculated by the commissioner of employment and economic development for 219.23the county in which the project is located. The calculation of the basic cost of living wage 219.24must be done as provided for under section 116J.013, if enacted by the 2013 legislature.219.25    Subd. 2.Development plan approval by city.Section 15.99 does not apply to 219.26review and approval of the development plan. The city shall act on the development plan 219.27within 60 days following its submission by the corporation. The city may incorporate the 219.28development plan into the city's comprehensive plan.219.29    Subd. 3.Subject to city requirements.All projects are subject to the planning, 219.30zoning, sanitary, and building laws; ordinances; regulations; and land use plans that apply 219.31to the city.219.32    Subd. 4.Modification of development plan.The corporation may modify the 219.33development plan at any time. The corporation must update the development plan not less 219.34than every five years. A modification or update under this subdivision must be adopted by 219.35the corporation upon the notice and after the public hearing and findings required for the 219.36original adoption of the development plan, including approval by the city.220.1    Subd. 5.Medical center development districts; creation; notice; findings.As 220.2part of the development plan, the corporation may create and define the boundaries of 220.3medical center development districts and subdistricts at any place or places within the 220.4city. Projects may be undertaken within defined medical center development districts 220.5consistent with the development plan.220.6    Subd. 6.Nonprofit economic development agency.(a) The medical business 220.7entity must establish a nonprofit economic development agency organized under chapter 220.8317A to provide experience and expertise in developing and marketing the destination 220.9medical center. The corporation must engage the agency to assist the corporation in 220.10preparing the development plan. The governing board of the agency must be comprised of 220.11members of the medical community, city, and county. The agency must collaborate with 220.12city, county, and other community representatives. The nonprofit agency must provide 220.13services to assist the corporation and city in implementing the goals, objectives, and 220.14strategies in the development plan including, but not limited to:220.15(1) facilitating private investment through development of a comprehensive 220.16marketing program to global interests;220.17(2) developing and updating the criteria for evaluating and underwriting 220.18development proposals;220.19(3) drafting and implementing the development plan, including soliciting and 220.20evaluating proposals for development and evaluating and making recommendations to the 220.21authority and the city regarding those proposals;220.22(4) providing transactional services in connection with approved projects;220.23(5) developing patient, visitor, and community outreach programs for a destination 220.24medical center development district;220.25(6) working with the corporation to acquire and facilitate the sale, lease, or other 220.26transactions involving land and real property;220.27(7) seeking financial support for the corporation, the city, and a project;220.28(8) partnering with other development agencies and organizations, the city, and the 220.29county in joint efforts to promote economic development and establish a destination 220.30medical center;220.31(9) supporting and administering the planning and development activities required to 220.32implement the development plan;220.33(10) preparing and supporting the marketing and promotion of the medical center 220.34development district;220.35(11) preparing and implementing a program for community and public relations in 220.36support of the medical center development district;221.1(12) assisting the corporation or city and others in applications for federal grants, tax 221.2credits, and other sources of funding to aid both private and public development; and221.3(13) making other general advisory recommendations to the corporation and the 221.4city, as requested.221.5(b) The nonprofit economic development agency must disclose to the city and 221.6to the corporation the existence, nature, and all material facts regarding any financial 221.7interest its employees or contractors have in any public infrastructure project submitted 221.8to the city for approval and any financial interest its employees or contractors have in 221.9the destination medical center development. "Contractors" includes affiliates of the 221.10contractors or members or shareholders with an ownership interest of more than 20 221.11percent in the contractor.221.12    Subd. 7.Audit of nonprofit economic development agency contract.Any contract 221.13for services between the corporation and the nonprofit economic development agency 221.14paid, in whole or in part, with public money provides the corporation, the city, and the state 221.15auditor the right to audit the books and records of the agency that are necessary to certify:221.16(1) the nature and extent of the services furnished pursuant to the contract; and221.17(2) that the payment for services and related disbursements complies with all state 221.18laws, regulations, and the terms of the contract.221.19Any contract for services between the corporation and the agency paid, in whole 221.20or in part, with public money must require the corporation to maintain for the life of the 221.21corporation accurate and complete books and records directly relating to the contract.221.22    Subd. 8.Report.By February 15 of each year, the corporation and city must jointly 221.23submit a report to the chairs and ranking minority members of the legislative committees 221.24and divisions with jurisdiction over local and state government operations, economic 221.25development, and taxes, and to the commissioners of revenue and employment and 221.26economic development, and the county. The corporation and city must also submit the 221.27report as provided in section 3.195. The report must include:221.28(1) the development plan and any proposed changes to the development plan;221.29(2) progress of projects identified in the development plan;221.30(3) actual costs and financing sources, including the amount paid with state aid under 221.31section 469.47, and required local contributions of projects completed in the previous two 221.32years by the corporation, city, county, and the medical business entity;221.33(4) estimated costs and financing sources for projects to be started in the next two 221.34years by the corporation, city, county, and the medical business entity; and221.35(5) debt service schedules for all outstanding obligations of the city for debt issued 221.36for projects identified in the plan.222.1    Sec. 7. [469.44] CITY POWERS, DUTIES; AUTHORITY TO ISSUE BONDS.222.2    Subdivision 1.Port authority powers.The city may exercise the powers of a 222.3port authority under sections 469.048 to 469.068 for the purposes of implementing the 222.4destination medical center development plan.222.5    Subd. 2.Support to the corporation.The city must provide financial and 222.6administrative support, and office and other space, to the corporation. The city may 222.7appropriate city funds to the corporation for its work.222.8    Subd. 3.City to issue debt.The city may issue general obligation bonds, revenue 222.9bonds, or other obligations, as it determines appropriate, to finance public infrastructure 222.10projects, as provided by chapter 475. Notwithstanding section 475.53, obligations issued 222.11under this section are not subject to the limits on net debt, regardless of their source of 222.12security or payment. Notwithstanding section 475.58 or any other law or charter provision 222.13to the contrary, issuance of obligations under the provisions of this section are not subject 222.14to approval of the electors. The city may pledge any of its revenues, including property 222.15taxes, the taxes authorized by sections 469.45 and 469.46, and the state aid under section 222.16469.47, as security for and to pay the obligations. The city must not issue obligations that 222.17are only payable from or secured by state aid under section 469.47.222.18    Subd. 4.Local government tax base not reduced.Nothing in sections 469.40 to 222.19469.47 reduces the tax base or affects the taxes due and payable to the city, the county, 222.20or any school district within the boundaries of the city, including without limitation, 222.21the city's general local sales tax.222.22    Subd. 5.Project implementation before plan adoption.The city may exercise the 222.23powers under subdivision 3 with respect to any public infrastructure project commenced 222.24within the area that will be in the destination medical center development district after the 222.25effective date of this section but before the development plan is adopted subject to approval 222.26by the corporation. Actions taken under this authority must be approved by the corporation 222.27to be credited against the local contribution required under section 469.47, subdivision 4.222.28    Subd. 6.American made steel.The city must require that a public infrastructure 222.29project use American steel products to the extent practicable. In determining whether it 222.30is practicable, the city may consider the exceptions to the requirement in Public Law 222.31111-5, section 1605.222.32    Subd. 7.City contracts; construction requirements.For all public infrastructure 222.33projects, the city must make every effort to hire and cause the construction manager and 222.34any subcontractors to employ women and members of minority communities. Goals for 222.35construction contracts must be established in the manner required under the city's minority 222.36and women-owned business enterprises utilization plan.223.1    Subd. 8.Conduit bond issuance.(a) Upon the request of the corporation or the 223.2nonprofit agency, the city or its economic development authority shall issue revenue bonds 223.3or other similar obligations for a qualifying project. Revenue bonds or other obligations as 223.4used in this subdivision means bonds or other obligations issued under sections 469.152 223.5to 469.165 or under chapter 462C, the interest on which is tax exempt. The city or its 223.6development authority shall use its best efforts to issue the bonds or other obligations 223.7as promptly and efficiently as possible following the request and the provision of the 223.8information and completion of the actions by the corporation or the nonprofit agency that 223.9are necessary for the issuance. Upon request of the corporation or nonprofit agency, 223.10the city or its economic development authority shall adopt methods and procedures that 223.11preserve the confidentiality of private donors or other private participants in the qualifying 223.12project, including structures and methods that do not require disclosing information on 223.13the donors or participants to the city or its economic development authority, and shall 223.14segregate in separate accounts all funds related to a qualifying project from other city 223.15and authority funds.223.16(b) For purposes of this section, a "qualifying project" means a project, as that 223.17term is defined in section 469.153, or a project that would qualify for financing under 223.18chapter 462C, that:223.19(1) the corporation finds is consistent with and will further the goals of the 223.20development plan;223.21(2) is located in a medical development district; and223.22(3) has a commitment of private funding sources such as donations of money or 223.23in-kind contributions, other than revenues generated by the project, equal to at least ten 223.24percent of the total capital cost of the project.223.25    Subd. 9.Public bidding exemption.(a) Notwithstanding section 469.068 or any 223.26other law to the contrary, the city need not require competitive bidding with respect to a 223.27parking facility or other public improvements constructed in conjunction with, and directly 223.28above or below, or adjacent and integrally related to, a private development financed 223.29or developed under the development plan.223.30(b) For purposes of this section, "city" includes the development authority 223.31established by the city.223.32    Sec. 8. [469.45] CITY TAX AUTHORITY.223.33    Subdivision 1.Rochester, other local taxes authorized.(a) Notwithstanding 223.34section 477A.016, or any other contrary provision of law, ordinance, or city charter, and in 223.35addition to any taxes the city may impose on these transactions under another statute or 224.1law, the city of Rochester may, by ordinance, impose at a rate or rates, determined by the 224.2city, any of the following taxes:224.3(1) a tax on the gross receipts from the furnishing for consideration of lodging and 224.4related services as defined in section 297A.61, subdivision 3, paragraph (g), clause (2); the 224.5city may choose to impose a differential tax based on the number of rooms in the facility;224.6(2) a tax on the gross receipts of food and beverages sold primarily for consumption 224.7on the premises by restaurants and places of refreshment that occur in the city of 224.8Rochester; the city may elect to impose the tax in a defined district of the city; and224.9(3) a tax on the admission receipts to entertainment and recreational facilities, as 224.10defined by ordinance, in the city of Rochester.224.11(b) The provisions of section 297A.99, subdivisions 4 to 13, govern the 224.12administration, collection, and enforcement of any tax imposed by the city under 224.13paragraph (a).224.14(c) The proceeds of any taxes imposed under this subdivision, less refunds and 224.15costs of collection, must be used by the city only to meet its share of obligations for 224.16public infrastructure projects contained in the development plan and approved by the 224.17corporation, including any associated financing costs. Any tax imposed under paragraph 224.18(a) expires at the earlier of December 31, 2049, or when the city council determines 224.19that sufficient funds have been raised from the tax plus all other local funding sources 224.20authorized in this article to meet the city obligation for financing public infrastructure 224.21projects contained in the development plan and approved by the corporation, including 224.22any associated financing costs.224.23    Subd. 2.General sales tax authority.The city may elect to extend the existing 224.24local sales and use tax under section 13 or to impose an additional rate of up to one quarter 224.25of one percent tax on sales and use under section 11. The proceeds of any extended or 224.26additional taxes imposed under this subdivision, less refunds and costs of collection, must 224.27be used by the city only to meet its share of obligations for public infrastructure projects 224.28contained in the development plan and approved by the corporation, including all financing 224.29costs. Revenues collected in any year to meet the obligations must be used for payment of 224.30obligations or expenses for public infrastructure projects approved by the corporation.224.31    Subd. 3.Special abatement rules.(a) If the city or the county elects to use tax 224.32abatement under sections 469.1812 to 469.1815 to finance costs of public infrastructure 224.33projects, including all financing costs, the special rules under this subdivision apply. 224.34Taxes abated for public infrastructure projects must be used only for obligations or other 224.35infrastructure projects approved by the corporation.225.1(b) The limitations under section 469.1813, subdivision 6, do not apply to the city 225.2or the county.225.3(c) The limitations under section 469.1813, subdivision 8, do not apply and property 225.4taxes abated by the city or the county to finance costs of public infrastructure projects are 225.5not included for purposes of applying section 469.1813, subdivision 8, to the use of tax 225.6abatement for other purposes of the city or the county; however, the total amount of property 225.7taxes abated by the city and the county under this authority must not exceed $87,750,000.225.8    Subd. 4.Special tax increment financing rules.If the city elects to establish 225.9one or more redevelopment tax increment financing districts within the area of the 225.10destination medical center development district to fund public infrastructure projects, the 225.11requirements, definitions, limitations, or restrictions in the following statutes do not apply: 225.12sections 469.174, subdivisions 10 and 25, clause (2); 469.176, subdivisions 4j, 4l, and 5; 225.13and 469.1763, subdivisions 2, 3, and 4. The provisions of this subdivision expire effective 225.14for tax increments expended after December 31, 2049. After that date, the provisions of 225.15section 469.1763, subdivision 4, apply to any remaining unspent or unobligated increments.225.16    Sec. 9. [469.46] COUNTY TAX AUTHORITY.225.17(a) Notwithstanding sections 297A.99, 297A.993, and 477A.016, or any other 225.18contrary provision of law, ordinance, or charter, and in addition to any taxes the county 225.19may impose under another law or statute, the Board of Commissioners of Olmsted County 225.20may, by resolution, impose a transit tax of up to one quarter of one percent on retail sales 225.21and uses taxable under chapter 297A. The provisions of section 297A.99, subdivisions 225.224 to 13, govern the imposition, administration, collection, and enforcement of the tax 225.23authorized under this paragraph.225.24(b) The Board of Commissioners of Olmsted County may, by resolution, levy an 225.25annual wheelage tax of up to $10 on each motor vehicle kept in the county when not in 225.26operation which is subject to annual registration and taxation under chapter 168, for 225.27transportation projects within the county. The wheelage tax must not be imposed on the 225.28vehicles exempt from wheelage tax under section 163.051, subdivision 1. The board, 225.29by resolution, may provide for collection of the wheelage tax by county officials, or it 225.30may request that the tax be collected by the state registrar on behalf of the county. The 225.31provisions of section 163.051, subdivisions 2, 2a, 3, and 7, must govern the administration, 225.32collection, and enforcement of the tax authorized under this paragraph. The tax authorized 225.33under this section is in addition to any tax the county may be authorized to impose under 225.34section 163.051, but until January 1, 2018, the county tax imposed under this paragraph, 226.1in combination with any tax imposed under section 163.051, must equal the specified 226.2rate under section 163.051.226.3(c) The proceeds of any taxes imposed under paragraph (a), less refunds and costs 226.4of collection, must be first used by the county to meet its local matching contributions 226.5under section 469.47, subdivision 6, for financing transit infrastructure related to the 226.6public infrastructure projects contained in the development plan and approved by the 226.7corporation, including any financing costs. Revenues collected in any calendar year in 226.8excess of the county obligation to pay for projects contained in the development plan may 226.9be retained by the county and used for funding other transportation projects, including 226.10roads and bridges, airports, and transportation improvements.226.11(d) Any taxes imposed under paragraph (a) expire December 31, 2049, or at an 226.12earlier time if approved by resolution of the county board of commissioners. The taxes 226.13must not terminate before the county board of commissioners determines that revenues 226.14from these taxes and any other revenue source the county dedicates are sufficient to pay 226.15the county share of transit project costs and financing costs under the development plan.226.16    Sec. 10. [469.47] STATE INFRASTRUCTURE AID.226.17    Subdivision 1.Definitions.(a) For purposes of this section, the following terms 226.18have the meanings given them.226.19(b) "Commissioner" means the commissioner of employment and economic 226.20development.226.21(c) "Construction projects" means:226.22(1) for expenditures by a medical business entity, construction of buildings in the 226.23city for which the building permit was issued after June 30, 2013; and226.24(2) for any other expenditures, construction of privately owned buildings and other 226.25improvements that are undertaken pursuant to or as part of the development plan and are 226.26located within a medical center development district.226.27(d) "Expenditures" means expenditures made by a medical business entity or by an 226.28individual or private entity on construction projects for the capital cost of the project 226.29including, but not limited to:226.30(1) design and predesign, including architectural, engineering, and similar services;226.31(2) legal, regulatory, and other compliance costs of the project;226.32(3) land acquisition, demolition of existing improvements, and other site preparation 226.33costs;226.34(4) construction costs, including all materials and supplies of the project; and226.35(5) equipment and furnishings that are attached to or become part of the real property.227.1Expenditures excludes supplies and other items with a useful life of less than a 227.2year that are not used or consumed in constructing improvements to real property or 227.3are otherwise chargeable to capital costs.227.4(e) "Qualified expenditures" has the following meaning. In the first year in which aid 227.5is paid under this section, "qualified expenditures" means the total certified expenditures 227.6since June 30, 2013, through the end of the preceding year, minus $200,000,000. For 227.7subsequent years, "qualified expenditures" means the certified expenditures for the 227.8preceding year.227.9(f) "Transit costs" means the portions of a public infrastructure project that are for 227.10public transit intended primarily to serve the district, such as transit stations, equipment, 227.11rights-of-way, and similar costs.227.12    Subd. 2.Certification of expenditures.By April 1 of each year, the medical 227.13business entity must certify to the commissioner the amount of expenditures made by the 227.14medical business entity in the preceding year. For expenditures made by an individual 227.15or entity other than the medical business entity, the corporation shall compile the 227.16information on the expenditures and may certify the amount to the commissioner. The 227.17certification must be made in the form that the commissioner prescribes and include 227.18any documentation of and supporting information regarding the expenditures that the 227.19commissioner requires. By August 1 of each year, the commissioner must determine the 227.20amount of the expenditures for the preceding year.227.21    Subd. 3.General state infrastructure aid.(a) General state infrastructure aid may 227.22not be paid out under this section until total expenditures exceed $200,000,000.227.23(b) The amount of the general state infrastructure aid for a fiscal year equals the sum 227.24of qualified expenditures, multiplied by 2.75 percent. The maximum amount of state 227.25aid payable in any year is limited to no more than $30,000,000. If the aid entitlement 227.26for the year exceeds the maximum annual limit, the excess is an aid carryover to later 227.27years. The carryover aid must be paid in the first year in which the aid entitlement for the 227.28current year is less than the maximum annual limit, but only to the extent the carryover, 227.29when added to the current year aid, is less than the maximum annual limit. If the 227.30commissioner determines that the city has made the required matching local contribution 227.31under subdivision 4, the commissioner must pay to the city the amount of general state 227.32infrastructure aid for the year by September 1.227.33(c) The city must use general state infrastructure aid it receives under this subdivision 227.34for improvements and other capital costs related to the public infrastructure projects 227.35approved by the corporation, other than transit costs. The city must maintain appropriate 227.36records to document the use of the funds under this requirement.228.1(d) The commissioner, in consultation with the commissioner of management and 228.2budget, and representatives of the city and the corporation, must establish a total limit on 228.3the amount of state aid payable under this subdivision that will be adequate to finance, in 228.4combination with the local contribution, $455,000,000 of general public infrastructure 228.5projects.228.6    Subd. 4.General aid; local matching contribution.In order to qualify for general 228.7state infrastructure aid, the city must enter a written agreement with the commissioner 228.8that requires the city to make a qualifying local matching contribution to pay for 228.9$128,000,000 of the cost of public infrastructure projects approved by the corporation, 228.10including financing costs, using funds other than state aid received under this section. 228.11The $128,000,000 required local matching contribution is reduced by one half of the 228.12amounts the city pays for operating and administrative costs of the corporation up to a 228.13maximum amount agreed to by the board and the city. The agreement must provide for the 228.14manner, timing, and amounts of the city contributions, including the city's commitment 228.15for each year. Notwithstanding any law to the contrary, the agreement may provide that 228.16the city contributions for public infrastructure project principal costs may be made over a 228.1720-year period at a rate not greater than $1 from the city for each $2.55 from the state. 228.18The local match contribution may be provided by the city from any source identified in 228.19section 469.45 and any other local tax proceeds or other funds from the city and may 228.20include providing funds to assist developers undertaking projects in accordance with the 228.21development plan or by the city directly undertaking public infrastructure projects in 228.22accordance with the development plan, provided the projects have been approved by the 228.23corporation. City contributions that are in excess of this ratio carry forward and are credited 228.24towards subsequent years. The commissioner and city may agree to amend the agreement 228.25at any time in light of new information or other appropriate factors. The city may enter 228.26into arrangements with the county to pay for or otherwise meet the local matching 228.27contribution requirement. Any public infrastructure project within the area that will be in 228.28the destination medical center development district whose implementation is started or 228.29funded by the city after the effective date of this section but before the development plan 228.30is adopted, as provided by section 469.46, subdivision 5, will be included for the purposes 228.31of determining the amount the city has contributed as required by this section and the 228.32agreement with the commissioner, subject to approval by the corporation.228.33    Subd. 5.State transit aid.(a) The city qualifies for state transit aid under this section 228.34if the county contributes the required local matching contribution under subdivision 6 or the 228.35city or county has agreed to make an equivalent contribution out of other funds for the year.229.1(b) If the city qualifies for aid under paragraph (a), the commissioner must pay the 229.2city the state transit aid in the amount calculated under this paragraph. The amount of the 229.3state transit aid for a fiscal year equals the sum of qualified expenditures, as certified by 229.4the commissioner for the prior year, multiplied by 0.75 percent, reduced by the amount 229.5of the local contribution under subdivision 6. The maximum amount of state transit aid 229.6payable in any year is limited to no more than $7,500,000. If the aid entitlement for the 229.7year exceeds the maximum annual limit, the excess is an aid carryover to later years. The 229.8carryover aid must be paid in the first year in which the aid entitlement for the current year 229.9is less than the maximum annual limit, but only to the extent the carryover, when added to 229.10the current year aid, is less than the maximum annual limit.229.11(c) The commissioner, in consultation with the commissioner of management and 229.12budget, and representatives of the city and the corporation, must establish a total limit on 229.13the amount of state aid payable under this subdivision that will be adequate to finance, in 229.14combination with the local contribution, $116,000,000 of transit costs.229.15(d) The city must use state transit aid it receives under this subdivision for transit 229.16costs. The city must maintain appropriate records to document the use of the funds 229.17under this requirement.229.18    Subd. 6.Transit aid; local matching contribution.(a) The required local matching 229.19contribution for state transit aid equals the lesser of:229.20(1) 40 percent of the state transit aid under subdivision 5; or229.21(2) the amount that would be raised by a 0.15 percent sales tax imposed by the 229.22county in the preceding year.229.23The county may impose the sales tax or the wheelage tax under section 469.46 229.24to meet this obligation.229.25(b) If the county elects not to impose any of the taxes authorized under section 469.46, 229.26the county, or city, or both, may agree to make the local contribution out of other available 229.27funds, other than state aid payable under this section. The commissioner of revenue must 229.28estimate the required amount and certify it to the commissioner, city, and county.229.29    Subd. 7.Prevailing wage requirement.During the construction, installation, 229.30remodelling, and repairs of any public infrastructure project funded by state aid or a local 229.31matching contribution under this section, laborers and mechanics at the site must be paid 229.32the prevailing wage rate as defined in section 177.42, subdivision 6, and the project is 229.33subject to the requirements of sections 177.30 and 177.41 to 177.44.229.34    Subd. 8.Termination.No aid may be paid under this section after fiscal year 2049.230.1    Subd. 9.Appropriation.An amount sufficient to pay the state general infrastructure 230.2and state transit aid authorized under this section is appropriated to the commissioner 230.3from the general fund.230.4    Sec. 11. Laws 1998, chapter 389, article 8, section 43, subdivision 1, is amended to read:230.5    Subdivision 1. Sales and use taxes authorized.(a) Notwithstanding Minnesota 230.6Statutes, section 
         477A.016, or any other contrary provision of law, ordinance, or city 230.7charter, upon termination of the taxes authorized under Laws 1992, chapter 511, article 230.88, section 33, subdivision 1, and if approved by the voters of the city at a general or 230.9special election held within one year of the date of final enactment of this act, the city of 230.10Rochester may, by ordinance, impose an additional sales and use tax of up to one-half 230.11of one percent. The provisions of Minnesota Statutes, section 
         297A.48 297A.99, govern 230.12the imposition, administration, collection, and enforcement of the tax authorized under 230.13this subdivision paragraph.230.14(b) Notwithstanding Minnesota Statutes, sections 297A.99 and 477A.016, or any 230.15other contrary provision of law, ordinance, or charter, the city of Rochester may, by 230.16ordinance, impose an additional sales and use tax of up to one quarter of one percent. The 230.17provisions of Minnesota Statutes, section 297A.99, subdivisions 1 and 4 to 13, govern 230.18the imposition, administration, collection, and enforcement of the tax authorized under 230.19this paragraph.230.20    Sec. 12. Laws 1998, chapter 389, article 8, section 43, subdivision 3, as amended by 230.21Laws 2005, First Special Session chapter 3, article 5, section 28, and Laws 2011, First 230.22Special Session chapter 7, article 4, section 5, is amended to read:230.23    Subd. 3. Use of revenues. (a) Revenues received from the taxes authorized by 230.24subdivisions 1, paragraph (a), and 2 must be used by the city to pay for the cost of 230.25collecting and administering the taxes and to pay for the following projects:230.26    (1) transportation infrastructure improvements including regional highway and 230.27airport improvements;230.28    (2) improvements to the civic center complex;230.29    (3) a municipal water, sewer, and storm sewer project necessary to improve regional 230.30ground water quality; and230.31    (4) construction of a regional recreation and sports center and other higher education 230.32facilities available for both community and student use.230.33    (b) The total amount of capital expenditures or bonds for projects listed in paragraph 230.34(a) that may be paid from the revenues raised from the taxes authorized in this section 231.1may not exceed $111,500,000. The total amount of capital expenditures or bonds for the 231.2project in clause (4) that may be paid from the revenues raised from the taxes authorized 231.3in this section may not exceed $28,000,000.231.4(c) In addition to the projects authorized in paragraph (a) and not subject to the 231.5amount stated in paragraph (b), the city of Rochester may, if approved by the voters at an 231.6election under subdivision 5, paragraph (c), use the revenues received from the taxes and 231.7bonds authorized in this section to pay the costs of or bonds for the following purposes:231.8(1) $17,000,000 for capital expenditures and bonds for the following Olmsted 231.9County transportation infrastructure improvements:231.10(i) County State Aid Highway 34 reconstruction;231.11(ii) Trunk Highway 63 and County State Aid Highway 16 interchange; 231.12(iii) phase II of the Trunk Highway 52 and County State Aid Highway 22 interchange;231.13(iv) widening of County State Aid Highway 22 West Circle Drive; and 231.14(v) 60th Avenue Northwest corridor preservation;231.15(2) $30,000,000 for city transportation projects including:231.16(i) Trunk Highway 52 and 65th Street interchange;231.17(ii) NW transportation corridor acquisition; 231.18(iii) Phase I of the Trunk Highway 52 and County State Aid Highway 22 interchange;231.19(iv) Trunk Highway 14 and Trunk Highway 63 intersection;231.20(v) Southeast transportation corridor acquisition;231.21(vi) Rochester International Airport expansion; and 231.22(vii) a transit operations center bus facility;231.23(3) $14,000,000 for the University of Minnesota Rochester academic and 231.24complementary facilities;231.25(4) $6,500,000 for the Rochester Community and Technical College/Winona State 231.26University career technical education and science and math facilities;231.27(5) $6,000,000 for the Rochester Community and Technical College regional 231.28recreation facilities at University Center Rochester;231.29(6) $20,000,000 for the Destination Medical Community Initiative;231.30(7) $8,000,000 for the regional public safety and 911 dispatch center facilities;231.31(8) $20,000,000 for a regional recreation/senior center;231.32(9) $10,000,000 for an economic development fund; and231.33(10) $8,000,000 for downtown infrastructure.231.34(d) No revenues from the taxes raised from the taxes authorized in subdivisions 1 231.35and 2 may be used to fund transportation improvements related to a railroad bypass that 231.36would divert traffic from the city of Rochester.232.1(e) The city shall use $5,000,000 of the money allocated to the purpose in paragraph 232.2(c), clause (9), for grants to the cities of Byron, Chatfield, Dodge Center, Dover, Elgin, 232.3Eyota, Kasson, Mantorville, Oronoco, Pine Island, Plainview, St. Charles, Stewartville, 232.4Zumbrota, Spring Valley, West Concord, and Hayfield for economic development projects 232.5that these communities would fund through their economic development authority or 232.6housing and redevelopment authority. Notwithstanding Minnesota Statutes, section 232.7297A.99, subdivisions 2 and 3, if the city decides to extend the taxes in subdivisions 1, 232.8paragraph (a), and 2, as allowed under subdivision 5, paragraph (c), the city must use 232.9any amount in excess of the amount necessary to meet obligations under paragraphs (a) 232.10to (c) from those taxes to fund obligations, including financing costs, related to public 232.11infrastructure projects in the development plan adopted under Minnesota Statutes, section 232.12469.43.232.13(f) Revenues from the tax under subdivision 1, paragraph (b), must be used to 232.14fund obligations, including financing costs, related to the public infrastructure projects 232.15contained in the development plan approved by the DMCC and adopted by the city under 232.16Minnesota Statutes, section 469.43.232.17    Sec. 13. Laws 1998, chapter 389, article 8, section 43, subdivision 5, as amended by 232.18Laws 2005, First Special Session chapter 3, article 5, section 30, and Laws 2011, First 232.19Special Session chapter 7, article 4, section 7, is amended to read:232.20    Subd. 5. Termination of taxes. (a) The taxes imposed under subdivisions 1 and 2 232.21expire at the later of (1) December 31, 2009, or (2) when the city council determines that 232.22sufficient funds have been received from the taxes to finance the first $71,500,000 of capital 232.23expenditures and bonds for the projects authorized in subdivision 3, including the amount to 232.24prepay or retire at maturity the principal, interest, and premium due on any bonds issued for 232.25the projects under subdivision 4, unless the taxes are extended as allowed in paragraph (b). 232.26Any funds remaining after completion of the project and retirement or redemption of the 232.27bonds shall also be used to fund the projects under subdivision 3. The taxes imposed under 232.28subdivisions 1 and 2 may expire at an earlier time if the city so determines by ordinance.232.29    (b) Notwithstanding Minnesota Statutes, sections 
         297A.99 and 
         477A.016, or any 232.30other contrary provision of law, ordinance, or city charter, the city of Rochester may, by 232.31ordinance, extend the taxes authorized in subdivisions 1 and 2 beyond December 31, 2009, 232.32if approved by the voters of the city at a special election in 2005 or the general election in 232.332006. The question put to the voters must indicate that an affirmative vote would allow 232.34up to an additional $40,000,000 of sales tax revenues be raised and up to $40,000,000 232.35of bonds to be issued above the amount authorized in the June 23, 1998, referendum for 233.1the projects specified in subdivision 3. If the taxes authorized in subdivisions 1 and 2 are 233.2extended under this paragraph, the taxes expire when the city council determines that 233.3sufficient funds have been received from the taxes to finance the projects and to prepay 233.4or retire at maturity the principal, interest, and premium due on any bonds issued for the 233.5projects under subdivision 4. Any funds remaining after completion of the project and 233.6retirement or redemption of the bonds may be placed in the general fund of the city.233.7(c) Notwithstanding Minnesota Statutes, sections 
         297A.99 and 
         477A.016, or any 233.8other contrary provision of law, ordinance, or city charter, the city of Rochester may, by 233.9ordinance, extend the taxes authorized in subdivisions 1, paragraph (a),  and 2 beyond the 233.10date, up to December 31, 2049, provided that all additional revenues above those necessary 233.11to fund the projects and associated financing costs listed in subdivision 3, paragraphs (a) to 233.12(e), are committed to fund public infrastructure projects contained in the development plan 233.13adopted under Minnesota Statutes, section 469.43, including all financing costs; otherwise 233.14the taxes terminate when  the city council determines that sufficient funds have been 233.15received from the taxes to finance $111,500,000 of expenditures and bonds for the projects 233.16authorized in subdivision 3, paragraph (a) paragraphs (a) to (e), plus an amount equal to 233.17the costs of issuance of the bonds and including the amount to prepay or retire at maturity 233.18the principal, interest, and premiums due on any bonds issued for the projects under 233.19subdivision 4, paragraph (a), if approved by the voters of the city at the general election in 233.202012. If the election to authorize the additional $139,500,000 of bonds plus an amount 233.21equal to the costs of the issuance of the bonds is placed on the general election ballot in 233.222012, the city may continue to collect the taxes authorized in subdivisions 1 and 2 until 233.23December 31, 2012. The question put to the voters must indicate that an affirmative vote 233.24would allow sales tax revenues be raised for an extended period of time and an additional 233.25$139,500,000 of bonds plus an amount equal to the costs of issuance of the bonds, to be 233.26issued above the amount authorized in the previous elections required under paragraphs 233.27(a) and (b) for the projects and amounts specified in subdivision 3. If the taxes authorized 233.28in subdivisions 1 and 2 are extended under this paragraph, the taxes expire when the city 233.29council determines that $139,500,000 has been received from the taxes to finance the 233.30projects plus an amount sufficient to prepay or retire at maturity the principal, interest, 233.31and premium due on any bonds issued for the projects under subdivision 4, including any 233.32bonds issued to refund the bonds. Any funds remaining after completion of the projects 233.33and retirement or redemption of the bonds may be placed in the general fund of the city.233.34(d) The tax imposed under subdivision 1, paragraph (b), expires at the earlier of 233.352049, or when the city council determines that sufficient funds have been raised from the 233.36tax plus all other city funding sources authorized in this article to meet the city obligation 234.1for financing the public infrastructure projects contained in the development plan adopted 234.2under Minnesota Statutes, section 469.43, including all financing costs.234.3    Sec. 14. ROCHESTER SALES TAX SHARING.234.4The city council may, after holding a public hearing and passing a resolution, use 234.5$5,000,000 of the $10,000,000 allocated to an economic development fund in Laws 1998, 234.6chapter 389, article 8, section 43, subdivision 3, as amended by Laws 2005, First Special 234.7Session chapter 3, article 5, section 28, and Laws 2011, First Special Session chapter 7, 234.8article 4, section 5, paragraph (c), clause (9), for grants to any or all of the cities of Byron, 234.9Chatfield, Dodge Center, Dover, Elgin, Eyota, Hayfield, Kasson, Mantorville, Oronoco, 234.10Pine Island, Plainview, Spring Valley, St. Charles, Stewartville, West Concord, and 234.11Zumbrota for economic development projects that these communities would fund through 234.12their economic development authority or housing and redevelopment authority. The 234.13public hearing may be part of a regular city council meeting. If the council does not pass 234.14the resolution by September 1, 2013, the $5,000,000 may not be used for grants to the 234.15other cities but shall instead be used to fund public infrastructure projects contained in the 234.16development plan under Minnesota Statutes, section 469.42.234.17    Sec. 15. OLMSTED INTERREGIONAL PASSENGER RAIL STUDY.234.18The study by the Olmsted County Regional Rail authority, in conjunction with the 234.19Minnesota Department of Transportation, on interregional passenger rail, and funded 234.20under Laws 2009, chapter 93, article 1, section 11, subdivision 5, must include analysis 234.21of the feasibility of a high-speed rail connection between Rochester and the Mall of 234.22America via Minnesota State Highway 77 with connections to the Minneapolis-St. Paul 234.23International Airport and the Union Depot in St. Paul; and, to the extent feasible, take into 234.24account available data, forecasts, available transportation demand modeling information, 234.25and transportation impacts of major economic initiatives and proposals including, but not 234.26limited to, expansion of the Mayo Clinic.234.27EFFECTIVE DATE.This section is effective the day following final enactment.234.28    Sec. 16. EFFECTIVE DATE.234.29Except as otherwise provided, this article is effective the day after the governing 234.30body of the city of Rochester and its chief clerical officer timely comply with Minnesota 234.31Statutes, section 645.021, subdivisions 2 and 3.235.1ARTICLE 11235.2MINERALS TAXES235.3    Section 1. Minnesota Statutes 2012, section 126C.48, subdivision 8, is amended to read:235.4    Subd. 8. Taconite payment and other reductions. (1) Reductions in levies 235.5pursuant to subdivision 1 must be made prior to the reductions in clause (2).235.6(2) Notwithstanding any other law to the contrary, districts that have revenue 235.7pursuant to sections 
         298.018; 
         298.225; 
         298.24 to 
         298.28, except an amount distributed 235.8under sections 
         298.26; 
         298.28, subdivision 4, paragraphs (c), clause (ii), and (d); 
         298.34235.9to 
         298.39; 
         298.391 to 
         298.396; 
         298.405; 
         477A.15; and any law imposing a tax upon 235.10severed mineral values must reduce the levies authorized by this chapter and chapters 235.11120B, 122A, 123A, 123B, 124A, 124D, 125A, and 127A by 95 percent of the sum of the 235.12previous year's revenue specified under this clause and the amount attributable to the same 235.13production year distributed to the cities and townships within the school district under 235.14section 298.28, subdivision 2, paragraph (c).235.15(3) The amount of any voter approved referendum, facilities down payment, and 235.16debt levies shall not be reduced by more than 50 percent under this subdivision. In 235.17administering this paragraph, the commissioner shall first reduce the nonvoter approved 235.18levies of a district; then, if any payments, severed mineral value tax revenue or recognized 235.19revenue under paragraph (2) remains, the commissioner shall reduce any voter approved 235.20referendum levies authorized under section 
         126C.17; then, if any payments, severed 235.21mineral value tax revenue or recognized revenue under paragraph (2) remains, the 235.22commissioner shall reduce any voter approved facilities down payment levies authorized 235.23under section 
         123B.63 and then, if any payments, severed mineral value tax revenue or 235.24recognized revenue under paragraph (2) remains, the commissioner shall reduce any 235.25voter approved debt levies.235.26(4) Before computing the reduction pursuant to this subdivision of the health and 235.27safety levy authorized by sections 
         123B.57 and 
         126C.40, subdivision 5, the commissioner 235.28shall ascertain from each affected school district the amount it proposes to levy under 235.29each section or subdivision. The reduction shall be computed on the basis of the amount 235.30so ascertained.235.31(5) To the extent the levy reduction calculated under paragraph (2) exceeds the 235.32limitation in paragraph (3), an amount equal to the excess must be distributed from the 235.33school district's distribution under sections 
         298.225, 
         298.28, and 
         477A.15 in the following 235.34year to the cities and townships within the school district in the proportion that their 235.35taxable net tax capacity within the school district bears to the taxable net tax capacity of 235.36the school district for property taxes payable in the year prior to distribution. No city or 236.1township shall receive a distribution greater than its levy for taxes payable in the year prior 236.2to distribution. The commissioner of revenue shall certify the distributions of cities and 236.3towns under this paragraph to the county auditor by September 30 of the year preceding 236.4distribution. The county auditor shall reduce the proposed and final levies of cities and 236.5towns receiving distributions by the amount of their distribution. Distributions to the cities 236.6and towns shall be made at the times provided under section 
         298.27.236.7EFFECTIVE DATE.This section is effective for levies certified in 2013 and later.236.8    Sec. 2. Minnesota Statutes 2012, section 298.17, is amended to read:236.9298.17 OCCUPATION TAXES TO BE APPORTIONED.236.10(a) All occupation taxes paid by persons, copartnerships, companies, joint stock 236.11companies, corporations, and associations, however or for whatever purpose organized, 236.12engaged in the business of mining or producing iron ore or other ores, when collected 236.13shall be apportioned and distributed in accordance with the Constitution of the state of 236.14Minnesota, article X, section 3, in the manner following: 90 percent shall be deposited 236.15in the state treasury and credited to the general fund of which four-ninths shall be used 236.16for the support of elementary and secondary schools; and ten percent of the proceeds of 236.17the tax imposed by this section shall be deposited in the state treasury and credited to the 236.18general fund for the general support of the university.236.19(b) Of the moneys apportioned to the general fund by this section: (1) there is 236.20annually appropriated and credited to the mining environmental and regulatory account in 236.21the special revenue fund an amount equal to that which would have been generated by a 236.22two and one-half cent tax imposed by section 298.24 on each taxable ton produced in the 236.23preceding calendar year. Money in the mining environmental and regulatory account is 236.24appropriated annually to the commissioner of natural resources to fund agency staff to 236.25work on environmental issues and provide regulatory services for ferrous and nonferrous 236.26mining operations in this state. Payment to the mining environmental and regulatory 236.27account shall be made by July 1 annually. The commissioner of natural resources shall 236.28execute an interagency agreement with the pollution control agency to assist with the 236.29provision of environmental regulatory services such as monitoring and permitting required 236.30for ferrous and nonferrous mining operations; and (2) there is annually appropriated and 236.31credited to the Iron Range Resources and Rehabilitation Board account in the special 236.32revenue fund an amount equal to that which would have been generated by a 1.5 cent tax 236.33imposed by section 
         298.24 on each taxable ton produced in the preceding calendar year, to 236.34be expended for the purposes of section 
         298.22.237.1The money appropriated pursuant to this section clause (2) shall be used (1) (i)237.2 to provide environmental development grants to local governments located within any 237.3county in region 3 as defined in governor's executive order number 60, issued on June 237.412, 1970, which does not contain a municipality qualifying pursuant to section 
         273.134, 237.5paragraph (b)
         , or (2) (ii) to provide economic development loans or grants to businesses 237.6located within any such county, provided that the county board or an advisory group 237.7appointed by the county board to provide recommendations on economic development 237.8shall make recommendations to the Iron Range Resources and Rehabilitation Board 237.9regarding the loans. Payment to the Iron Range Resources and Rehabilitation Board 237.10account shall be made by May 15 annually.237.11(c) Of the money allocated to Koochiching County, one-third must be paid to the 237.12Koochiching County Economic Development Commission.237.13EFFECTIVE DATE.This section is effective beginning for the 2013 production 237.14year.237.15    Sec. 3. Minnesota Statutes 2012, section 298.227, as amended by Laws 2013, chapter 237.163, section 17, is amended to read:237.17298.227 TACONITE ECONOMIC DEVELOPMENT FUND.237.18    (a) An amount equal to that distributed pursuant to each taconite producer's taxable 237.19production and qualifying sales under section 
         298.28, subdivision 9a, shall be held by 237.20the Iron Range Resources and Rehabilitation Board in a separate taconite economic 237.21development fund for each taconite and direct reduced ore producer. Money from the 237.22fund for each producer shall be released by the commissioner after review by a joint 237.23committee consisting of an equal number of representatives of the salaried employees and 237.24the nonsalaried production and maintenance employees of that producer. The District 11 237.25director of the United States Steelworkers of America, on advice of each local employee 237.26president, shall select the employee members. In nonorganized operations, the employee 237.27committee shall be elected by the nonsalaried production and maintenance employees. The 237.28review must be completed no later than six months after the producer presents a proposal 237.29for expenditure of the funds to the committee. The funds held pursuant to this section may 237.30be released only for workforce development and associated public facility improvement, 237.31or for acquisition of plant and stationary mining equipment and facilities for the producer 237.32or for research and development in Minnesota on new mining, or taconite, iron, or steel 237.33production technology, but only if the producer provides a matching expenditure equal to 237.34the amount of the distribution to be used for the same purpose of at least 50 percent of 238.1the distribution based on 14.7 cents per ton beginning with distributions in 2002 2014. 238.2Effective for proposals for expenditures of money from the fund beginning May 26, 2007, 238.3the commissioner may not release the funds before the next scheduled meeting of the 238.4board. If a proposed expenditure is not approved by the board, the funds must be deposited 238.5in the Taconite Environmental Protection Fund under sections 
         298.222 to 
         298.225. If a 238.6producer uses money which has been released from the fund prior to May 26, 2007 to 238.7procure haulage trucks, mobile equipment, or mining shovels, and the producer removes 238.8the piece of equipment from the taconite tax relief area defined in section 
         273.134 within 238.9ten years from the date of receipt of the money from the fund, a portion of the money 238.10granted from the fund must be repaid to the taconite economic development fund. The 238.11portion of the money to be repaid is 100 percent of the grant if the equipment is removed 238.12from the taconite tax relief area within 12 months after receipt of the money from the fund, 238.13declining by ten percent for each of the subsequent nine years during which the equipment 238.14remains within the taconite tax relief area. If a taconite production facility is sold after 238.15operations at the facility had ceased, any money remaining in the fund for the former 238.16producer may be released to the purchaser of the facility on the terms otherwise applicable 238.17to the former producer under this section. If a producer fails to provide matching funds 238.18for a proposed expenditure within six months after the commissioner approves release 238.19of the funds, the funds are available for release to another producer in proportion to the 238.20distribution provided and under the conditions of this section. Any portion of the fund 238.21which is not released by the commissioner within one year of its deposit in the fund shall 238.22be divided between the taconite environmental protection fund created in section 
         298.223 238.23and the Douglas J. Johnson economic protection trust fund created in section 
         298.292 for 238.24placement in their respective special accounts. Two-thirds of the unreleased funds shall be 238.25distributed to the taconite environmental protection fund and one-third to the Douglas J. 238.26Johnson economic protection trust fund.238.27    (b)(i) Notwithstanding the requirements of paragraph (a), setting the amount of 238.28distributions and the review process, an amount equal to ten cents per taxable ton of 238.29production in 2007, for distribution in 2008 only, that would otherwise be distributed 238.30under paragraph (a), may be used for a loan or grant for the cost of providing for a 238.31value-added wood product facility located in the taconite tax relief area and in a county 238.32that contains a city of the first class. This amount must be deducted from the distribution 238.33under paragraph (a) for which a matching expenditure by the producer is not required. The 238.34granting of the loan or grant is subject to approval by the board. If the money is provided 238.35as a loan, interest must be payable on the loan at the rate prescribed in section 
         298.2213, 238.36subdivision 3
         . (ii) Repayments of the loan and interest, if any, must be deposited in the 239.1taconite environment protection fund under sections 
         298.222 to 
         298.225. If a loan or 239.2grant is not made under this paragraph by July 1, 2012, the amount that had been made 239.3available for the loan under this paragraph must be transferred to the taconite environment 239.4protection fund under sections 
         298.222 to 
         298.225. (iii) Money distributed in 2008 to the 239.5fund established under this section that exceeds ten cents per ton is available to qualifying 239.6producers under paragraph (a) on a pro rata basis.239.7(c) Repayment or transfer of money to the taconite environmental protection fund 239.8under paragraph (b), item (ii), must be allocated by the Iron Range Resources and 239.9Rehabilitation Board for public works projects in house legislative districts in the same 239.10proportion as taxable tonnage of production in 2007 in each house legislative district, for 239.11distribution in 2008, bears to total taxable tonnage of production in 2007, for distribution 239.12in 2008. Notwithstanding any other law to the contrary, expenditures under this paragraph 239.13do not require approval by the governor. For purposes of this paragraph, "house legislative 239.14districts" means the legislative districts in existence on May 15, 2009.239.15EFFECTIVE DATE.This section is effective beginning for the 2014 distribution.239.16    Sec. 4. Minnesota Statutes 2012, section 298.24, subdivision 1, is amended to read:239.17    Subdivision 1. Imposed; calculation. (a) For concentrate produced in 2001, 2002, 239.18and 2003 2013, there is imposed upon taconite and iron sulphides, and upon the mining 239.19and quarrying thereof, and upon the production of iron ore concentrate therefrom, and 239.20upon the concentrate so produced, a tax of $2.103 $2.56 per gross ton of merchantable 239.21iron ore concentrate produced therefrom. For concentrates produced in 2005, the tax rate 239.22is the same rate imposed for concentrates produced in 2004. For concentrates produced in 239.232009 and subsequent years, The tax is also imposed upon other iron-bearing material.239.24    (b) For concentrates produced in 2006 2014 and subsequent years, the tax rate shall 239.25be equal to the preceding year's tax rate plus an amount equal to the preceding year's tax 239.26rate multiplied by the percentage increase in the implicit price deflator from the fourth 239.27quarter of the second preceding year to the fourth quarter of the preceding year. "Implicit 239.28price deflator" means the implicit price deflator for the gross domestic product prepared by 239.29the Bureau of Economic Analysis of the United States Department of Commerce.239.30    (c) An additional tax is imposed equal to three cents per gross ton of merchantable 239.31iron ore concentrate for each one percent that the iron content of the product exceeds 72 239.32percent, when dried at 212 degrees Fahrenheit.239.33    (d) The tax on taconite and iron sulphides shall be imposed on the average of the 239.34production for the current year and the previous two years. The rate of the tax imposed 239.35will be the current year's tax rate. This clause shall not apply in the case of the closing 240.1of a taconite facility if the property taxes on the facility would be higher if this clause 240.2and section 
         298.25 were not applicable. The tax on other iron-bearing material shall be 240.3imposed on the current year production.240.4    (e) If the tax or any part of the tax imposed by this subdivision is held to be 240.5unconstitutional, a tax of $2.103 $2.56 per gross ton of merchantable iron ore concentrate 240.6produced shall be imposed.240.7    (f) Consistent with the intent of this subdivision to impose a tax based upon the 240.8weight of merchantable iron ore concentrate, the commissioner of revenue may indirectly 240.9determine the weight of merchantable iron ore concentrate included in fluxed pellets by 240.10subtracting the weight of the limestone, dolomite, or olivine derivatives or other basic 240.11flux additives included in the pellets from the weight of the pellets. For purposes of this 240.12paragraph, "fluxed pellets" are pellets produced in a process in which limestone, dolomite, 240.13olivine, or other basic flux additives are combined with merchantable iron ore concentrate. 240.14No subtraction from the weight of the pellets shall be allowed for binders, mineral and 240.15chemical additives other than basic flux additives, or moisture.240.16    (g)(1) Notwithstanding any other provision of this subdivision, for the first two years 240.17of a plant's commercial production of direct reduced ore from ore mined in this state, no 240.18tax is imposed under this section. As used in this paragraph, "commercial production" is 240.19production of more than 50,000 tons of direct reduced ore in the current year or in any prior 240.20year, "noncommercial production" is production of 50,000 tons or less of direct reduced ore 240.21in any year, and "direct reduced ore" is ore that results in a product that has an iron content 240.22of at least 75 percent. For the third year of a plant's commercial production of direct 240.23reduced ore, the rate to be applied to direct reduced ore is 25 percent of the rate otherwise 240.24determined under this subdivision. For the fourth commercial production year, the rate is 240.2550 percent of the rate otherwise determined under this subdivision; for the fifth commercial 240.26production year, the rate is 75 percent of the rate otherwise determined under this 240.27subdivision; and for all subsequent commercial production years, the full rate is imposed.240.28    (2) Subject to clause (1), production of direct reduced ore in this state is subject to 240.29the tax imposed by this section, but if that production is not produced by a producer of 240.30taconite, iron sulfides, or other iron-bearing material, the production of taconite, iron 240.31sulfides, or other iron-bearing material, that is consumed in the production of direct 240.32reduced iron in this state is not subject to the tax imposed by this section on taconite, 240.33iron sulfides, or other iron-bearing material.240.34    (3) Notwithstanding any other provision of this subdivision, no tax is imposed 240.35on direct reduced ore under this section during the facility's noncommercial production 240.36of direct reduced ore. The taconite or iron sulphides consumed in the noncommercial 241.1production of direct reduced ore is subject to the tax imposed by this section on taconite 241.2and iron sulphides. Three-year average production of direct reduced ore does not 241.3include production of direct reduced ore in any noncommercial year. Three-year average 241.4production for a direct reduced ore facility that has noncommercial production is the 241.5average of the commercial production of direct reduced ore for the current year and the 241.6previous two commercial years.241.7    (4) This paragraph applies only to plants for which all environmental permits have 241.8been obtained and construction has begun before July 1, 2008.241.9EFFECTIVE DATE.This section is effective beginning for the 2013 production 241.10year.241.11    Sec. 5. Minnesota Statutes 2012, section 298.28, subdivision 4, is amended to read:241.12    Subd. 4. School districts. (a) 23.15 32.15 cents per taxable ton, plus the increase 241.13provided in paragraph (d), less the amount that would have been computed under 241.14Minnesota Statutes 2008, section 
         126C.21, subdivision 4, for the current year for that 241.15district, must be allocated to qualifying school districts to be distributed, based upon the 241.16certification of the commissioner of revenue, under paragraphs (b), (c), and (f).241.17    (b)(i) 3.43 cents per taxable ton must be distributed to the school districts in which 241.18the lands from which taconite was mined or quarried were located or within which the 241.19concentrate was produced. The distribution must be based on the apportionment formula 241.20prescribed in subdivision 2.241.21    (ii) Four cents per taxable ton from each taconite facility must be distributed to 241.22each affected school district for deposit in a fund dedicated to building maintenance 241.23and repairs, as follows:241.24    (1) proceeds from Keewatin Taconite or its successor are distributed to Independent 241.25School Districts Nos. 316, Coleraine, and 319, Nashwauk-Keewatin, or their successor 241.26districts;241.27    (2) proceeds from the Hibbing Taconite Company or its successor are distributed to 241.28Independent School Districts Nos. 695, Chisholm, and 701, Hibbing, or their successor 241.29districts;241.30    (3) proceeds from the Mittal Steel Company and Minntac or their successors are 241.31distributed to Independent School Districts Nos. 712, Mountain Iron-Buhl, 706, Virginia, 241.322711, Mesabi East, and 2154, Eveleth-Gilbert, or their successor districts;241.33    (4) proceeds from the Northshore Mining Company or its successor are distributed 241.34to Independent School Districts Nos. 2142, St. Louis County, and 381, Lake Superior, 241.35or their successor districts; and242.1    (5) proceeds from United Taconite or its successor are distributed to Independent 242.2School Districts Nos. 2142, St. Louis County, and 2154, Eveleth-Gilbert, or their 242.3successor districts.242.4    Revenues that are required to be distributed to more than one district shall be 242.5apportioned according to the number of pupil units identified in section 
         126C.05, 242.6subdivision 1
         , enrolled in the second previous year.242.7    (c)(i) 15.72 24.72 cents per taxable ton, less any amount distributed under paragraph 242.8(e), shall be distributed to a group of school districts comprised of those school districts 242.9which qualify as a tax relief area under section 
         273.134, paragraph (b), or in which there is 242.10a qualifying municipality as defined by section 
         273.134, paragraph (a), in direct proportion 242.11to school district indexes as follows: for each school district, its pupil units determined 242.12under section 
         126C.05 for the prior school year shall be multiplied by the ratio of the 242.13average adjusted net tax capacity per pupil unit for school districts receiving aid under 242.14this clause as calculated pursuant to chapters 122A, 126C, and 127A for the school year 242.15ending prior to distribution to the adjusted net tax capacity per pupil unit of the district. 242.16Each district shall receive that portion of the distribution which its index bears to the sum 242.17of the indices for all school districts that receive the distributions.242.18    (ii) Notwithstanding clause (i), each school district that receives a distribution 242.19under sections 
         298.018; 
         298.23 to 
         298.28, exclusive of any amount received under this 242.20clause; 
         298.34 to 
         298.39; 
         298.391 to 
         298.396; 
         298.405; or any law imposing a tax on 242.21severed mineral values after reduction for any portion distributed to cities and towns 242.22under section 
         126C.48, subdivision 8, paragraph (5), that is less than the amount of its 242.23levy reduction under section 
         126C.48, subdivision 8, for the second year prior to the 242.24year of the distribution shall receive a distribution equal to the difference; the amount 242.25necessary to make this payment shall be derived from proportionate reductions in the 242.26initial distribution to other school districts under clause (i). If there are insufficient tax 242.27proceeds to make the distribution provided under this paragraph in any year, money must 242.28be transferred from the taconite property tax relief account in subdivision 6, to the extent 242.29of the shortfall in the distribution.242.30    (d)(1) Any school district described in paragraph (c) where a levy increase pursuant 242.31to section 
         126C.17, subdivision 9, was authorized by referendum for taxes payable in 242.322001, shall receive a distribution of 21.3 cents per ton. Each district shall receive $175 242.33times the pupil units identified in section 
         126C.05, subdivision 1, enrolled in the second 242.34previous year or the 1983-1984 school year, whichever is greater, less the product of 1.8 242.35percent times the district's taxable net tax capacity in the second previous year 2011.243.1(2) Districts qualifying under paragraph (c) must receive additional taconite aid each 243.2year equal to 22.5 percent of the amount obtained by subtracting:243.3(i) 1.8 percent of the district's net tax capacity for 2011, from:243.4(ii) the district's weighted average daily membership for fiscal year 2012 multiplied 243.5by the sum of:243.6(A) $415, plus243.7(B) the district's referendum revenue allowance for fiscal year 2013.243.8    If the total amount provided by paragraph (d) is insufficient to make the payments 243.9herein required then the entitlement of $175 per pupil unit shall be reduced uniformly 243.10so as not to exceed the funds available. Any amounts received by a qualifying school 243.11district in any fiscal year pursuant to paragraph (d) shall not be applied to reduce general 243.12education aid which the district receives pursuant to section 
         126C.13 or the permissible 243.13levies of the district. Any amount remaining after the payments provided in this paragraph 243.14shall be paid to the commissioner of Iron Range resources and rehabilitation who shall 243.15deposit the same in the taconite environmental protection fund and the Douglas J. Johnson 243.16economic protection trust fund as provided in subdivision 11.243.17    Each district receiving money according to this paragraph shall reserve the lesser of 243.18the amount received under this paragraph or $25 times the number of pupil units served 243.19in the district. It may use the money for early childhood programs or for outcome-based 243.20learning programs that enhance the academic quality of the district's curriculum. The 243.21outcome-based learning programs must be approved by the commissioner of education.243.22    (e) There shall be distributed to any school district the amount which the school 243.23district was entitled to receive under section 
         298.32 in 1975.243.24    (f) Four cents per taxable ton must be distributed to qualifying school districts 243.25according to the distribution specified in paragraph (b), clause (ii), and two 11 cents 243.26per taxable ton must be distributed according to the distribution specified in paragraph 243.27(c). These amounts are not subject to sections 
         126C.21, subdivision 4, and 
         126C.48, 243.28subdivision 8
         .243.29EFFECTIVE DATE.This section is effective beginning for the 2014 distribution.243.30    Sec. 6. Minnesota Statutes 2012, section 298.28, subdivision 6, is amended to read:243.31    Subd. 6. Property tax relief. (a) In 2002 2014 and thereafter, 33.9 34.8 cents per 243.32taxable ton, less any amount required to be distributed under paragraphs (b) and (c), or 243.33section 
         298.2961, subdivision 5, must be allocated to St. Louis County acting as the 243.34counties' fiscal agent, to be distributed as provided in sections 
         273.134 to 
         273.136.244.1    (b) If an electric power plant owned by and providing the primary source of power 244.2for a taxpayer mining and concentrating taconite is located in a county other than the 244.3county in which the mining and the concentrating processes are conducted, .1875 cent per 244.4taxable ton of the tax imposed and collected from such taxpayer shall be paid to the county.244.5    (c) If an electric power plant owned by and providing the primary source of power 244.6for a taxpayer mining and concentrating taconite is located in a school district other than 244.7a school district in which the mining and concentrating processes are conducted, .4541 244.8cent per taxable ton of the tax imposed and collected from the taxpayer shall be paid to 244.9the school district.244.10EFFECTIVE DATE.This section is effective beginning for the 2014 distribution.244.11    Sec. 7. Minnesota Statutes 2012, section 298.28, subdivision 9c, is amended to read:244.12    Subd. 9c. Temporary Distribution; city of Eveleth. 0.20 cent per taxable ton 244.13must be paid to the city of Eveleth for distribution in 2007 through 2011 only 2013 244.14and thereafter, to be used for the support of the Hockey Hall of Fame, provided that it 244.15continues to operate in that city, and provided that the city of Eveleth certifies to the St. 244.16Louis County auditor that it has received donations for the support of the Hockey Hall of 244.17Fame from professional hockey organizations or other donors in an amount at least equal 244.18to the amount of the distribution under this subdivision. If the Hockey Hall of Fame 244.19ceases to operate in the city of Eveleth prior to receipt of the distribution in eitherany 244.20year, and the governing body of the city determines that it is unlikely to resume operation 244.21there within a six-month period, the distribution under this subdivision shall be made to 244.22the Iron Range Resources and Rehabilitation Board. If the amount of the distribution 244.23authorized under this subdivision exceeds the total amount of donations for the support of 244.24the Hockey Hall of Fame during the 12-month period ending 30 days before the date of 244.25the distribution, the amount by which 0.20 cent per ton exceeds the donations shall be 244.26distributed to the Iron Range Resources and Rehabilitation Board.244.27    Sec. 8. Minnesota Statutes 2012, section 298.28, subdivision 10, is amended to read:244.28    Subd. 10. Increase. (a) Except as provided in paragraph (b), beginning with 244.29distributions in 2000, the amount determined under subdivision 9 shall be increased in the 244.30same proportion as the increase in the implicit price deflator as provided in section 
         298.24, 244.31subdivision 1
         . Beginning with distributions in 2003 2015, the amount determined under 244.32subdivision 6, paragraph (a), shall be increased in the same proportion as the increase in 244.33the implicit price deflator as provided in section 
         298.24, subdivision 1.245.1(b) For distributions in 2005 and subsequent years, an amount equal to the increased 245.2tax proceeds attributable to the increase in the implicit price deflator as provided in 245.3section 
         298.24, subdivision 1, for taxes paid in 2005, except for the amount of revenue 245.4increases provided in subdivision 4, paragraph (d), is distributed to the grant and loan fund 245.5established in section 
         298.2961, subdivision 4.245.6EFFECTIVE DATE.This section is effective beginning for the 2014 distribution.245.7    Sec. 9. IRON RANGE FISCAL DISPARITIES STUDY.245.8The commissioner of revenue, in coordination with the commissioner of the Iron 245.9Range Resources and Rehabilitation Board, shall conduct a study of the tax relief 245.10area revenue distribution program contained in Minnesota Statutes, chapter 276A, 245.11commonly known as the Iron Range fiscal disparities program. By February 1, 2014, the 245.12commissioner of revenue shall submit a report to the chairs and ranking minority members 245.13of the house of representatives and senate tax committees consisting of the findings of the 245.14study and identification of issues for policy makers to consider. The study must analyze:245.15(1) trends in population, property tax base, property tax rates, and contribution 245.16and distribution capacity across the region;245.17(2) the volatility of the program's distribution and causes of the volatility;245.18(3) the impact of state tax policy changes on the fiscal disparities program; and245.19(4) the interaction between the program and the distribution of property tax aids and 245.20credits, taconite aid, and Iron Range Resources and Rehabilitation Board funding across 245.21the region.245.22EFFECTIVE DATE.This section is effective June 1, 2013.245.23    Sec. 10. 2013 DISTRIBUTION ONLY.245.24For the 2013 distribution, a special fund is established to receive 38.7 cents per ton of 245.25any excess of the balance remaining after distribution of amounts required under Minnesota 245.26Statutes, section 298.28, subdivision 6. The following amounts are allocated to St. Louis 245.27County acting as the fiscal agent for the recipients for the following specific purposes:245.28(1) 5.1 cents per ton to the city of Hibbing for improvements to the city's water 245.29supply system;245.30(2) 4.3 cents per ton to the city of Mountain Iron for the cost of moving utilities 245.31required as a result of actions undertaken by United States Steel Corporation;245.32(3) 2.5 cents per ton to the city of Biwabik for improvements to the city's water supply 245.33system, payable upon agreement with ArcelorMittal to satisfy water permit conditions;246.1(4) 2 cents per ton to the city of Tower for the Tower Marina;246.2(5) 2.4 cents per ton to the city of Grand Rapids for an eco-friendly heat transfer 246.3system to replace aging effluent lines and for parking lot repaving;246.4(6) 2.4 cents per ton to the city of Two Harbors for wastewater treatment plant 246.5improvements;246.6(7) 0.9 cents per ton to the city of Ely for the sanitary sewer replacement project;246.7(8) 0.6 cents per ton to the town of Crystal Bay for debt service of the Claire Nelson 246.8Intermodal Transportation Center;246.9(9) 0.5 cents per ton to the Greenway Joint Recreation Board for the Coleraine 246.10hockey arena renovations;246.11(10) 1.2 cents per ton for the West Range Regional Fire Hall and Training Center 246.12to merge the existing fire services of Coleraine, Bovey, Taconite Marble, Calumet, and 246.13Greenway Township;246.14(11) 2.5 cents per ton to the city of Hibbing for the Memorial Building;246.15(12) 0.7 cents per ton to the city of Chisholm for public works infrastructure;246.16(13) 1.8 cents per ton to the Crane Lake Water and Sanitary District for sanitary 246.17sewer extension;246.18(14) 2.5 cents per ton for the city of Buhl for the roof on the Mesabi Academy;246.19(15) 1.2 cents per ton to the city of Gilbert for the New Jersey/Ohio Avenue project;246.20(16) 1.5 cents per ton to the city of Cook for street improvements, business park 246.21infrastructure, and a maintenance garage;246.22(17) 0.5 cents per ton to the city of Cook for a water line project;246.23(18) 1.8 cents per ton to the city of Eveleth to be used for Jones Street reconstruction 246.24and the city auditorium;246.25(19) 0.5 cents for the city of Keewatin for an electrical substation and water line 246.26replacements;246.27(20) 3.3 cents for the city of Virginia for Fourth Street North infrastructure and 246.28Franklin Park improvement; and246.29(21) 0.5 cents per ton to the city of Grand Rapids for an economic development 246.30project.246.31EFFECTIVE DATE.This section is effective for the 2013 distribution, and all 246.32payments must be made separately and within ten days of the date of the August 2013 246.33payment. This section supersedes article 5, section 46, of 2013 H.F. No. 729, if enacted in 246.34the 2013 regular session of the legislature.247.1    Sec. 11. IRON RANGE RESOURCES AND REHABILITATION 247.2COMMISSIONER; BONDS AUTHORIZED.247.3    Subdivision 1.Issuance; purpose.Notwithstanding any provision of Minnesota 247.4Statutes, chapter 298, to the contrary, the commissioner of Iron Range resources and 247.5rehabilitation shall issue revenue bonds in a principal amount of $38,000,000 plus an 247.6amount sufficient to pay costs of issuance in one or more series, and thereafter may 247.7issue bonds to refund those bonds. The proceeds of the bonds must be used to pay costs 247.8of issuance and to make grants to school districts located in the taconite tax relief area 247.9defined in Minnesota Statutes, section 273.134, or the taconite assistance area defined 247.10in Minnesota Statutes, section 273.1341, to be used by the school districts to pay for 247.11building projects, such as energy efficiency, technology, infrastructure, health, safety, and 247.12maintenance improvements. Proceeds granted to School District No. 2142 must be used 247.13to reduce debt service on the building bond passed on December 8, 2009.247.14    Subd. 2.Appropriation.(a) There is annually appropriated from the distribution of 247.15taconite production tax revenues under Minnesota Statues, section 298.28, prior to the 247.16calculation of the amount of the remainder under Minnesota Statutes, section 298.28, 247.17subdivision 11, an amount sufficient to pay when due the principal and interest on the 247.18bonds issued pursuant to subdivision 1. The appropriation under this section must not 247.19exceed an amount equal to ten cents per taxable ton.247.20    (b) If in any year the amount available under paragraph (a) is insufficient to pay 247.21principal and interest due on the bonds in that year, an additional amount is appropriated 247.22from the Douglas J. Johnson fund to make up the deficiency. 247.23    (c) The appropriation under this subdivision terminates upon payment or maturity of 247.24the last of the bonds issued under this section.247.25    Subd. 3.Credit enhancement.The bonds issued under this section are "debt 247.26obligations" and the commissioner of Iron Range resources and rehabilitation is a "district" 247.27for purposes of Minnesota Statutes, section 126C.55, provided that advances made under 247.28Minnesota Statutes, section 126C.55, subdivision 2, are not subject to Minnesota Statutes, 247.29section 126C.55, subdivisions 4 to 7.247.30EFFECTIVE DATE.This section is effective the day following final enactment and 247.31applies beginning with the 2014 distribution under Minnesota Statutes, section 298.28.247.32ARTICLE 12247.33PUBLIC FINANCE247.34    Section 1. Minnesota Statutes 2012, section 118A.04, subdivision 3, is amended to read:248.1    Subd. 3. State and local securities. Funds may be invested in the following:248.2(1) any security which is a general obligation of any state or local government with 248.3taxing powers which is rated "A" or better by a national bond rating service;248.4(2) any security which is a revenue obligation of any state or local government with 248.5taxing powers which is rated "AA" or better by a national bond rating service; and248.6(3) a general obligation of the Minnesota housing finance agency which is a moral 248.7obligation of the state of Minnesota and is rated "A" or better by a national bond rating 248.8agency.; and248.9(4) any security which is an obligation of a school district with an original maturity 248.10not exceeding 13 months and (i) rated in the highest category by a national bond rating 248.11service or (ii) enrolled in the credit enhancement program pursuant to section 126C.55.248.12    Sec. 2. Minnesota Statutes 2012, section 118A.05, subdivision 5, is amended to read:248.13    Subd. 5. Guaranteed investment contracts. Agreements or contracts for 248.14guaranteed investment contracts may be entered into if they are issued or guaranteed 248.15by United States commercial banks, domestic branches of foreign banks, United States 248.16insurance companies, or their Canadian subsidiaries, or the domestic affiliates of any 248.17of the foregoing. The credit quality of the issuer's or guarantor's short- and long-term 248.18unsecured debt must be rated in one of the two highest categories by a nationally 248.19recognized rating agency. Agreements or contracts for guaranteed investment contracts 248.20with a term of 18 months or less may be entered into regardless of the credit quality of 248.21the issuer's or guarantor's long-term unsecured debt, provided that the credit quality of 248.22the issuer's short-term unsecured debt is rated in the highest category by a nationally 248.23recognized rating agency. Should the issuer's or guarantor's credit quality be downgraded 248.24below "A", the government entity must have withdrawal rights.248.25    Sec. 3. Minnesota Statutes 2012, section 216C.436, subdivision 7, is amended to read:248.26    Subd. 7. Repayment. An implementing entity that finances an energy improvement 248.27under this section must:248.28(1) secure payment with a lien against the benefited qualifying real property; and248.29(2) collect repayments as a special assessment as provided for in section 
         429.101 248.30or by charter, provided that special assessments may be made payable in up to 20 equal 248.31annual installments.248.32If the implementing entity is an authority, the local government that authorized 248.33the authority to act as implementing entity shall impose and collect special assessments 249.1necessary to pay debt service on bonds issued by the implementing entity under subdivision 249.28, and shall transfer all collections of the assessments upon receipt to the authority.249.3EFFECTIVE DATE.This section is effective the day following final enactment.249.4    Sec. 4. Minnesota Statutes 2012, section 373.01, subdivision 3, is amended to read:249.5    Subd. 3. Capital notes. (a) A county board may, by resolution and without 249.6referendum, issue capital notes subject to the county debt limit to purchase capital 249.7equipment useful for county purposes that has an expected useful life at least equal to the 249.8term of the notes. The notes shall be payable in not more than ten years and shall be 249.9issued on terms and in a manner the board determines. A tax levy shall be made for 249.10payment of the principal and interest on the notes, in accordance with section 
         475.61, 249.11as in the case of bonds.249.12    (b) For purposes of this subdivision, "capital equipment" means:249.13    (1) public safety, ambulance, road construction or maintenance, and medical 249.14equipment; and249.15    (2) computer hardware and software, whether bundled with machinery or equipment 249.16or unbundled, together with application development services and training related to the 249.17use of the computer hardware or software.249.18    Sec. 5. Minnesota Statutes 2012, section 373.40, subdivision 1, is amended to read:249.19    Subdivision 1. Definitions. For purposes of this section, the following terms have 249.20the meanings given.249.21(a) "Bonds" means an obligation as defined under section 
         475.51.249.22(b) "Capital improvement" means acquisition or betterment of public lands, 249.23buildings, or other improvements within the county for the purpose of a county courthouse, 249.24administrative building, health or social service facility, correctional facility, jail, law 249.25enforcement center, hospital, morgue, library, park, qualified indoor ice arena, roads 249.26and bridges, public works facilities, fairground buildings, and records and data storage 249.27facilities, and the acquisition of development rights in the form of conservation easements 249.28under chapter 84C. An improvement must have an expected useful life of five years or more 249.29to qualify. "Capital improvement" does not include a recreation or sports facility building 249.30(such as, but not limited to, a gymnasium, ice arena, racquet sports facility, swimming 249.31pool, exercise room or health spa), unless the building is part of an outdoor park facility 249.32and is incidental to the primary purpose of outdoor recreation. For purposes of this section, 249.33"capital improvement" includes expenditures for purposes described in this paragraph that 249.34have been incurred by a county before approval of a capital improvement plan, if such 250.1expenditures are included in a capital improvement plan approved on or before the date of 250.2the public hearing under subdivision 2 regarding issuance of bonds for such expenditures.250.3(c) "Metropolitan county" means a county located in the seven-county metropolitan 250.4area as defined in section 
         473.121 or a county with a population of 90,000 or more.250.5(d) "Population" means the population established by the most recent of the 250.6following (determined as of the date the resolution authorizing the bonds was adopted):250.7(1) the federal decennial census,250.8(2) a special census conducted under contract by the United States Bureau of the 250.9Census, or250.10(3) a population estimate made either by the Metropolitan Council or by the state 250.11demographer under section 
         4A.02.250.12(e) "Qualified indoor ice arena" means a facility that meets the requirements of 250.13section 
         373.43.250.14(f) "Tax capacity" means total taxable market value, but does not include captured 250.15market value.250.16    Sec. 6. Minnesota Statutes 2012, section 373.40, subdivision 2, is amended to read:250.17    Subd. 2. Application of election requirement. (a) Bonds issued by a county 250.18to finance capital improvements under an approved capital improvement plan are not 250.19subject to the election requirements of section 
         375.18 or 
         475.58. The bonds must be 250.20approved by vote of at least three-fifths of the members of the county board. In the case 250.21of a metropolitan county, the bonds must be approved by vote of at least two-thirds of 250.22the members of the county board.250.23(b) Before issuance of bonds qualifying under this section, the county must publish 250.24a notice of its intention to issue the bonds and the date and time of a hearing to obtain 250.25public comment on the matter. The notice must be published in the official newspaper 250.26of the county or in a newspaper of general circulation in the county. The notice must be 250.27published at least 14, but not more than 28, days before the date of the hearing.250.28(c) A county may issue the bonds only upon obtaining the approval of a majority of 250.29the voters voting on the question of issuing the obligations, if a petition requesting a vote 250.30on the issuance is signed by voters equal to five percent of the votes cast in the county in 250.31the last county general election and is filed with the county auditor within 30 days after 250.32the public hearing. The commissioner of revenue shall prepare a suggested form of the 250.33question to be presented at the election. If the county elects not to submit the question to 250.34the voters, the county shall not propose the issuance of bonds under this section for the 250.35same purpose and in the same amount for a period of 365 days from the date of receipt 251.1of the petition. If the question of issuing the bonds is submitted and not approved by the 251.2voters, the provisions of section 475.58, subdivision 1a, shall apply.251.3    Sec. 7. Minnesota Statutes 2012, section 383D.41, is amended by adding a subdivision 251.4to read:251.5    Subd. 10.Housing improvement areas.(a) In addition to its other powers, the 251.6Dakota County Community Development Agency shall have all powers of a city under 251.7sections 428A.11 to 428A.21 in connection with housing improvement areas in Dakota 251.8County.251.9(b) For purposes of the Dakota County Community Development Agency's exercise 251.10of the powers granted in this subdivision, references in sections 428A.11 to 428A.21 to:251.11(1) a "mayor" shall be references to the chair of the board of commissioners of the 251.12Dakota County Community Development Agency;251.13(2) a "council" shall be references to the board of commissioners of the Dakota 251.14County Community Development Agency; and251.15(3) a "city clerk" shall be references to an official of the Dakota County Community 251.16Development Agency designated by the executive director of the Dakota County 251.17Community Development Agency.251.18(c) Notwithstanding sections 428A.11, subdivision 3, and 428A.13, subdivision 1, 251.19the governing body of the Dakota County Community Development Agency may adopt 251.20a resolution, rather than an ordinance, establishing one or more housing improvement 251.21areas, and "enabling ordinance" for purposes of sections 428A.11 to 428A.21 means a 251.22resolution under this clause.251.23(d) The community development agency (1) shall send a copy of each petition 251.24for the establishment of a housing improvement area to the city in which the proposed 251.25housing improvement area is located, and (2) may not hold the public hearing required in 251.26section 428A.13, subdivision 2, fewer than 30 days after the date on which the related 251.27application was sent pursuant to clause (1). The community development agency may 251.28not establish a housing improvement area if the applicable city council opposes the 251.29establishment by resolution adopted within 30 days after the petition required to be sent 251.30pursuant to clause (1).251.31    Sec. 8. Minnesota Statutes 2012, section 410.32, is amended to read:251.32410.32 CITIES MAY ISSUE CAPITAL NOTES FOR CAPITAL EQUIPMENT.252.1    (a) Notwithstanding any contrary provision of other law or charter, a home rule 252.2charter city may, by resolution and without public referendum, issue capital notes subject 252.3to the city debt limit to purchase capital equipment.252.4    (b) For purposes of this section, "capital equipment" means:252.5    (1) public safety equipment, ambulance and other medical equipment, road 252.6construction and maintenance equipment, and other capital equipment; and252.7    (2) computer hardware and software, whether bundled with machinery or equipment 252.8or unbundled, together with application development services and training related to the 252.9use of the computer hardware and software.252.10    (c) The equipment or software must have an expected useful life at least as long 252.11as the term of the notes.252.12    (d) The notes shall be payable in not more than ten years and be issued on terms and 252.13in the manner the city determines. The total principal amount of the capital notes issued 252.14in a fiscal year shall not exceed 0.03 percent of the market value of taxable property 252.15in the city for that year.252.16    (e) A tax levy shall be made for the payment of the principal and interest on the 252.17notes, in accordance with section 
         475.61, as in the case of bonds.252.18    (f) Notes issued under this section shall require an affirmative vote of two-thirds of 252.19the governing body of the city.252.20    (g) Notwithstanding a contrary provision of other law or charter, a home rule charter 252.21city may also issue capital notes subject to its debt limit in the manner and subject to the 252.22limitations applicable to statutory cities pursuant to section 
         412.301.252.23    Sec. 9. Minnesota Statutes 2012, section 412.301, is amended to read:252.24412.301 FINANCING PURCHASE OF CERTAIN EQUIPMENT.252.25    (a) The council may issue certificates of indebtedness or capital notes subject to the 252.26city debt limits to purchase capital equipment.252.27    (b) For purposes of this section, "capital equipment" means:252.28    (1) public safety equipment, ambulance and other medical equipment, road 252.29construction and maintenance equipment, and other capital equipment; and252.30    (2) computer hardware and software, whether bundled with machinery or equipment 252.31or unbundled, together with application development services and training related to the 252.32use of the computer hardware or software.252.33    (c) The equipment or software must have an expected useful life at least as long as 252.34the terms of the certificates or notes.253.1    (d) Such certificates or notes shall be payable in not more than ten years and shall be 253.2issued on such terms and in such manner as the council may determine.253.3    (e) If the amount of the certificates or notes to be issued to finance any such purchase 253.4exceeds 0.25 percent of the market value of taxable property in the city, they shall not 253.5be issued for at least ten days after publication in the official newspaper of a council 253.6resolution determining to issue them; and if before the end of that time, a petition asking 253.7for an election on the proposition signed by voters equal to ten percent of the number of 253.8voters at the last regular municipal election is filed with the clerk, such certificates or notes 253.9shall not be issued until the proposition of their issuance has been approved by a majority 253.10of the votes cast on the question at a regular or special election.253.11    (f) A tax levy shall be made for the payment of the principal and interest on such 253.12certificates or notes, in accordance with section 
         475.61, as in the case of bonds.253.13    Sec. 10. Minnesota Statutes 2012, section 473.39, is amended by adding a subdivision 253.14to read:253.15    Subd. 1s.Obligations.After July 1, 2013, in addition to other authority in this 253.16section, the council may issue certificates of indebtedness, bonds, or other obligations 253.17under this section in an amount not exceeding $35,800,000 for capital expenditures as 253.18prescribed in the council's transit capital improvement program and for related costs, 253.19including the costs of issuance and sale of the obligations.253.20EFFECTIVE DATE.This section is effective the day following final enactment 253.21and applies in the counties of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and 253.22Washington. This section is not effective if the legislature authorizes and enacts issuance 253.23authority of at least $35,800,000 in 2013 H.F. No. 1444. If the legislature authorizes and 253.24enacts issuance authority of less than $35,800,000 in 2013 H.F. No. 1444, this section 253.25prevails, regardless of order of enactment.253.26    Sec. 11. Minnesota Statutes 2012, section 473.606, subdivision 3, is amended to read:253.27    Subd. 3. Treasurer; investments. The treasurer shall receive and be responsible 253.28for all moneys of the corporation, from whatever source derived, and the same shall be 253.29considered public funds. The treasurer shall disburse the moneys of the corporation only 253.30on orders made by the executive and operating officer, herein provided for, countersigned 253.31by such other officer or such employee of the corporation as may be authorized and 253.32directed so to do by the corporation, showing the name of the claimant and the nature of 253.33the claim. No disbursement shall be certified by such officers until the same have been 253.34approved by said commissioners at a meeting thereof. Whenever the executive director of 254.1the corporation shall certify, pursuant to action taken by the commissioners at a meeting 254.2thereof, that there are moneys and the amount thereof in the possession of the treasurer not 254.3currently needed, then the treasurer may invest said amount or any part thereof in:254.4(a) Treasury bonds, certificates of indebtedness, bonds or notes of the United States 254.5of America, or bonds, notes or certificates of indebtedness of the state of Minnesota, all of 254.6which must mature not later than three years from the date of purchase.254.7(b) Bonds, notes, debentures or other obligations issued by any agency or 254.8instrumentality of the United States or any securities guaranteed by the United States 254.9government, or for which the credit of the United States is pledged for the payment of 254.10the principal and interest thereof, all of which must mature not later than three years 254.11from date of purchase.254.12(c) Commercial paper of prime quality, or rated among the top third of the quality 254.13categories, not applicable to defaulted paper, as defined by a nationally recognized 254.14organization which rates such securities as eligible for investment in the state employees 254.15retirement fund except that any nonbanking issuing corporation, or parent company in the 254.16case of paper issued by operating utility or finance subsidiaries, must have total assets 254.17exceeding $500,000,000. Such commercial paper may constitute no more than 30 percent 254.18of the book value of the fund at the time of purchase, and the commercial paper of any 254.19one corporation shall not constitute more than four percent of the book value of the fund 254.20at the time of such investment.254.21(d) Any securities eligible under the preceding provisions, purchased with 254.22simultaneous repurchase agreement under which the securities will be sold to the particular 254.23dealer on a specified date at a predetermined price. In such instances, all maturities of 254.24United States government securities, or securities issued or guaranteed by the United 254.25States government or an agency thereof, may be purchased so long as any such securities 254.26which mature later than three years from the date of purchase have a current market 254.27value exceeding the purchase price by at least five percent on the date of purchase, and 254.28so long as such repurchase agreement involving securities extending beyond three years 254.29in maturity be limited to a period not exceeding 45 days.254.30(e) Certificates of deposit issued by any official depository of the commission. The 254.31commission may purchase certificates of deposit from a depository bank in an amount 254.32exceeding that insured by federal depository insurance to the extent that those certificates 254.33are secured by collateral maintained by the bank in a manner as prescribed for investments 254.34of the State Board of Investment.254.35(f) securities approved for investment under section 118A.04.255.1Whenever it shall appear to the commissioners that any invested funds are needed 255.2for current purposes before the maturity dates of the securities held, they shall cause the 255.3executive director to so certify to the treasurer and it shall then be the duty of the treasurer 255.4to order the sale or conversion into cash of the securities in the amount so certified. All 255.5interest and profit on said investments shall be credited to and constitute a part of the 255.6funds of the commission. The treasurer shall keep an account of all moneys received 255.7and disbursed, and at least once a year, at times to be designated by the corporation, file 255.8with the secretary a financial statement of the corporation, showing in appropriate and 255.9identifiable groupings the receipts and disbursements since the last approved statements; 255.10moneys on hand and the purposes for which the same are appropriated; and shall keep an 255.11account of all securities purchased as herein provided, the funds from which purchased 255.12and the interest and profit which may have accrued thereon, and shall accompany the 255.13financial statement aforesaid with a statement setting forth such account. The corporation 255.14may pay to the treasurer from time to time compensation in such amount as it may 255.15determine to cover clerk hire to enable the treasurer to carry out duties and those required 255.16in connection with bonds issued by the corporation as in this act authorized.255.17    Sec. 12. Minnesota Statutes 2012, section 474A.04, subdivision 1a, is amended to read:255.18    Subd. 1a. Entitlement reservations; carryforward; deduction. Any amount 255.19returned by an entitlement issuer before July 15 shall be reallocated through the housing 255.20pool. Any amount returned on or after July 15 shall be reallocated through the unified 255.21pool. An amount returned after the last Monday in November shall be reallocated to the 255.22Minnesota Housing Finance Agency. Any amount of bonding authority that an entitlement 255.23issuer carries forward under federal tax law that is not permanently issued or for which 255.24the governing body of the entitlement issuer has not enacted a resolution electing to use 255.25the authority for mortgage credit certificates and has not provided a notice of issue to the 255.26commissioner before 4:30 p.m. on the last business day in December of the succeeding 255.27calendar year shall be deducted from the entitlement allocation for that entitlement issuer 255.28in the next succeeding calendar year. Any amount deducted from an entitlement issuer's 255.29allocation under this subdivision shall be reallocated to other entitlement issuers, the 255.30housing pool, the small issue pool, and the public facilities pool on a proportional basis 255.31consistent with section 474A.03.255.32EFFECTIVE DATE.This section is effective the day following final enactment 255.33and applies to any bonding authority allocated in 2012 and subsequent years.255.34    Sec. 13. Minnesota Statutes 2012, section 474A.062, is amended to read:256.1474A.062 MINNESOTA OFFICE OF HIGHER EDUCATION 120-DAY 256.2ISSUANCE EXEMPTION.256.3    The Minnesota Office of Higher Education is exempt from the 120-day issuance 256.4requirements in this chapter and may carry forward allocations for student loan bonds into 256.5one successive calendar year, subject to carryforward notice requirements of section 256.6474A.131, subdivision 2
         .256.7EFFECTIVE DATE.This section is effective the day following final enactment 256.8and applies to any bonding authority allocated in 2012 and subsequent years.256.9    Sec. 14. Minnesota Statutes 2012, section 474A.091, subdivision 3a, is amended to read:256.10    Subd. 3a. Mortgage bonds. (a) Bonding authority remaining in the unified pool on 256.11October 1 is available for single-family housing programs for cities that applied in January 256.12and received an allocation under section 
         474A.061, subdivision 2a, in the same calendar 256.13year. The Minnesota Housing Finance Agency shall receive an allocation for mortgage 256.14bonds pursuant to this section, minus any amounts for a city or consortium that intends to 256.15issue bonds on its own behalf under paragraph (c).256.16    (b) The agency may issue bonds on behalf of participating cities. The agency shall 256.17request an allocation from the commissioner for all applicants who choose to have the 256.18agency issue bonds on their behalf and the commissioner shall allocate the requested 256.19amount to the agency. Allocations shall be awarded by the commissioner each Monday 256.20commencing on the first Monday in October through the last Monday in November for 256.21applications received by 4:30 p.m. on the Monday of the week preceding an allocation.256.22    For cities who choose to have the agency issue bonds on their behalf, allocations 256.23will be made loan by loan, on a first-come, first-served basis among the cities. The 256.24agency shall submit an application fee pursuant to section 
         474A.03, subdivision 4, and an 256.25application deposit equal to two percent of the requested allocation to the commissioner 256.26when requesting an allocation from the unified pool. After awarding an allocation and 256.27receiving a notice of issuance for mortgage bonds issued on behalf of the participating 256.28cities, the commissioner shall transfer the application deposit to the Minnesota Housing 256.29Finance Agency.256.30    For purposes of paragraphs (a) to (d), "city" means a county or a consortium of 256.31local government units that agree through a joint powers agreement to apply together 256.32for single-family housing programs, and has the meaning given it in section 
         462C.02, 256.33subdivision 6
         . "Agency" means the Minnesota Housing Finance Agency.256.34    (c) Any city that received an allocation pursuant to section 
         474A.061, subdivision 256.352a, paragraph (f)
         , in the current year that wishes to receive an additional allocation from 257.1the unified pool and issue bonds on its own behalf or pursuant to a joint powers agreement 257.2shall notify the Minnesota Housing Finance Agency by the third Monday in September. 257.3The total amount of allocation for mortgage bonds for a city choosing to issue bonds on its 257.4own behalf or through a joint powers agreement is limited to the lesser of: (i) the amount 257.5requested, or (ii) the product of the total amount available for mortgage bonds from the 257.6unified pool, multiplied by the ratio of the population of each city that applied in January 257.7and received an allocation under section 
         474A.061, subdivision 2a, in the same calendar 257.8year, as determined by the most recent estimate of the city's population released by the 257.9state demographer's office to the total of the population of all the cities that applied in 257.10January and received an allocation under section 
         474A.061, subdivision 2a, in the same 257.11calendar year. If a city choosing to issue bonds on its own behalf or through a joint powers 257.12agreement is located within a county that has also chosen to issue bonds on its own behalf 257.13or through a joint powers agreement, the city's population will be deducted from the 257.14county's population in calculating the amount of allocations under this paragraph.257.15    The Minnesota Housing Finance Agency shall notify each city choosing to issue 257.16bonds on its own behalf or pursuant to a joint powers agreement of the amount of its 257.17allocation by October 15. Upon determining the amount of the allocation of each choosing 257.18to issue bonds on its own behalf or through a joint powers agreement, the agency shall 257.19forward a list specifying the amounts allotted to each city.257.20    A city that chooses to issue bonds on its own behalf or through a joint powers 257.21agreement may request an allocation from the commissioner by forwarding an application 257.22with an application fee pursuant to section 
         474A.03, subdivision 4, and an application 257.23deposit equal to two percent of the requested amount to the commissioner no later than 257.244:30 p.m. on the Monday of the week preceding an allocation. Allocations to cities that 257.25choose to issue bonds on their own behalf shall be awarded by the commissioner on 257.26the first Monday after October 15 through the last Monday in November. No city may 257.27receive an allocation from the commissioner after the last Monday in November. The 257.28commissioner shall allocate the requested amount to the city or cities subject to the 257.29limitations under this subdivision.257.30    If a city issues mortgage bonds from an allocation received under this paragraph, 257.31the issuer must provide for the recycling of funds into new loans. If the issuer is not 257.32able to provide for recycling, the issuer must notify the commissioner in writing of the 257.33reason that recycling was not possible and the reason the issuer elected not to have the 257.34Minnesota Housing Finance Agency issue the bonds. "Recycling" means the use of money 257.35generated from the repayment and prepayment of loans for further eligible loans or for the 257.36redemption of bonds and the issuance of current refunding bonds.258.1    (d) No entitlement city or county or city in an entitlement county may apply for or 258.2be allocated authority to issue mortgage bonds or use mortgage credit certificates from 258.3the unified pool.258.4    (e) An allocation awarded to the agency for mortgage bonds under this section 258.5may be carried forward by the agency into the next succeeding calendar year subject to 258.6notice requirements under section 
         474A.131and is available until the last business day in 258.7December of that succeeding calendar year.258.8EFFECTIVE DATE.This section is effective the day following final enactment 258.9and applies to any bonding authority allocated in 2012 and subsequent years.258.10    Sec. 15. Minnesota Statutes 2012, section 475.521, subdivision 1, is amended to read:258.11    Subdivision 1. Definitions. For purposes of this section, the following terms have 258.12the meanings given.258.13(a) "Bonds" mean an obligation defined under section 
         475.51.258.14(b) "Capital improvement" means acquisition or betterment of public lands, 258.15buildings or other improvements for the purpose of a city hall, town hall, library, public 258.16safety facility, and public works facility. An improvement must have an expected useful 258.17life of five years or more to qualify. Capital improvement does not include light rail transit 258.18or any activity related to it, or a park, road, bridge, administrative building other than a 258.19city or town hall, or land for any of those facilities. For purposes of this section, "capital 258.20improvement" includes expenditures for purposes described in this paragraph that have 258.21been incurred by a municipality before approval of a capital improvement plan, if such 258.22expenditures are included in a capital improvement plan approved on or before the date of 258.23the public hearing under subdivision 2 regarding issuance of bonds for such expenditures.258.24(c) "Municipality" means a home rule charter or statutory city or a town described in 258.25section 
         368.01, subdivision 1 or 1a.258.26    Sec. 16. Minnesota Statutes 2012, section 475.521, subdivision 2, is amended to read:258.27    Subd. 2. Election requirement. (a) Bonds issued by a municipality to finance 258.28capital improvements under an approved capital improvements plan are not subject to the 258.29election requirements of section 
         475.58. The bonds must be approved by an affirmative 258.30vote of three-fifths of the members of a five-member governing body. In the case of a 258.31governing body having more or less than five members, the bonds must be approved by a 258.32vote of at least two-thirds of the members of the governing body.258.33(b) Before the issuance of bonds qualifying under this section, the municipality 258.34must publish a notice of its intention to issue the bonds and the date and time of the 259.1hearing to obtain public comment on the matter. The notice must be published in the 259.2official newspaper of the municipality or in a newspaper of general circulation in the 259.3municipality. Additionally, the notice may be posted on the official Web site, if any, of the 259.4municipality. The notice must be published at least 14 but not more than 28 days before 259.5the date of the hearing.259.6(c) A municipality may issue the bonds only after obtaining the approval of a 259.7majority of the voters voting on the question of issuing the obligations, if a petition 259.8requesting a vote on the issuance is signed by voters equal to five percent of the votes cast 259.9in the municipality in the last municipal general election and is filed with the clerk within 259.1030 days after the public hearing. The commissioner of revenue shall prepare a suggested 259.11form of the question to be presented at the election. If the municipality elects not to submit 259.12the question to the voters, the municipality shall not propose the issuance of bonds under 259.13this section for the same purpose and in the same amount for a period of 365 days from the 259.14date of receipt of the petition. If the question of issuing the bonds is submitted and not 259.15approved by the voters, the provisions of section 475.58, subdivision 1a, shall apply.259.16    Sec. 17. Minnesota Statutes 2012, section 475.58, subdivision 3b, is amended to read:259.17    Subd. 3b. Street reconstruction and bituminous overlays. (a) A municipality may, 259.18without regard to the election requirement under subdivision 1, issue and sell obligations 259.19for street reconstruction or bituminous overlays, if the following conditions are met:259.20    (1) the streets are reconstructed or overlaid under a street reconstruction or overlay 259.21plan that describes the street reconstruction or overlay to be financed, the estimated costs, 259.22and any planned reconstruction or overlay of other streets in the municipality over the 259.23next five years, and the plan and issuance of the obligations has been approved by a vote 259.24of all of the members of the governing body present at the meeting following a public 259.25hearing for which notice has been published in the official newspaper at least ten days but 259.26not more than 28 days prior to the hearing; and259.27    (2) if a petition requesting a vote on the issuance is signed by voters equal to 259.28five percent of the votes cast in the last municipal general election and is filed with the 259.29municipal clerk within 30 days of the public hearing, the municipality may issue the bonds 259.30only after obtaining the approval of a majority of the voters voting on the question of the 259.31issuance of the obligations. If the municipality elects not to submit the question to the 259.32voters, the municipality shall not propose the issuance of bonds under this section for the 259.33same purpose and in the same amount for a period of 365 days from the date of receipt 259.34of the petition. If the question of issuing the bonds is submitted and not approved by the 259.35voters, the provisions of section 475.58, subdivision 1a, shall apply.260.1    (b) Obligations issued under this subdivision are subject to the debt limit of the 260.2municipality and are not excluded from net debt under section 
         475.51, subdivision 4.260.3    (c) For purposes of this subdivision, street reconstruction and bituminous overlays 260.4includes utility replacement and relocation and other activities incidental to the street 260.5reconstruction, turn lanes and other improvements having a substantial public safety 260.6function, realignments, other modifications to intersect with state and county roads, and 260.7the local share of state and county road projects. For purposes of this subdivision, "street 260.8reconstruction" includes expenditures for street reconstruction that have been incurred 260.9by a municipality before approval of a street reconstruction plan, if such expenditures 260.10are included in a street reconstruction plan approved on or before the date of the public 260.11hearing under paragraph (a), clause (1), regarding issuance of bonds for such expenditures.260.12    (d) Except in the case of turn lanes, safety improvements, realignments, intersection 260.13modifications, and the local share of state and county road projects, street reconstruction 260.14and bituminous overlays does not include the portion of project cost allocable to widening 260.15a street or adding curbs and gutters where none previously existed.260.16    Sec. 18. Laws 1971, chapter 773, section 1, subdivision 2, as amended by Laws 1974, 260.17chapter 351, section 5, Laws 1976, chapter 234, sections 1 and 7, Laws 1978, chapter 788, 260.18section 1, Laws 1981, chapter 369, section 1, Laws 1983, chapter 302, section 1, Laws 260.191988, chapter 513, section 1, Laws 1992, chapter 511, article 9, section 23, Laws 1998, 260.20chapter 389, article 3, section 27, and Laws 2002, chapter 390, section 23, is amended to 260.21read:260.22    Subd. 2. For each of the years 2003 to 2013 to 2024, the city of St. Paul is 260.23authorized to issue bonds in the aggregate principal amount of $20,000,000 for each year.260.24EFFECTIVE DATE.This section is effective the day after compliance by the 260.25governing body of the city of St. Paul with Minnesota Statutes, section 645.021, 260.26subdivisions 2 and 3.260.27    Sec. 19. CARRYFORWARD OF BONDING AUTHORITY FOR 2011; NO 260.28DEDUCTION FROM ENTITLEMENT ALLOCATION.260.29    Notwithstanding Minnesota Statutes, section 474A.04, subdivision 1a, bonding 260.30authority that was allocated to an entitlement issuer in 2011 and that was carried forward 260.31under federal tax law, but for which the entitlement issuer did not provide a notice of issue 260.32to the commissioner of management and budget before 4:30 p.m. on the last business 260.33day of December 2012 must not be deducted from the entitlement allocation for that 260.34entitlement issuer in 2013.261.1EFFECTIVE DATE.This section is effective the day following final enactment 261.2and applies retroactively to rescind any reallocation by the commissioner of management 261.3and budget under Minnesota Statues, section 474A.04, subdivision 1a, of any amounts so 261.4deducted.261.5    Sec. 20. LOCAL MATCH; INDEPENDENT SCHOOL DISTRICT NO. 435; 261.6WAUBUN-OGEMA-WHITE EARTH.261.7(a) Independent School District No. 435, Waubun-Ogema-White Earth, may expand 261.8classroom space at its Ogema Elementary site using a grant of $551,532 that was awarded 261.9to the district by the Department of Human Services on August 12, 2012, pursuant to a 261.10grant agreement as provided by Minnesota Statutes, section 16A.695, subdivision 9. 261.11Notwithstanding Minnesota Statutes, section 16A.695, subdivision 6, to satisfy the match 261.12requirements of the grant agreement, the district may use a lease-purchase agreement. 261.13Notwithstanding Minnesota Statutes, section 465.71, the lease-purchase agreement must 261.14provide that the title to the lease-purchased property must be held by the district.261.15(b) Notwithstanding Minnesota Statutes, section 126C.13, subdivision 4, if the 261.16school district enters a lease-purchase agreement to satisfy the local match under 261.17paragraph (a), but fails to make a lease-purchase payment, the commissioner of education 261.18shall reduce its general education aid under Minnesota Statutes, section 126C.13, 261.19subdivision 4, by the amount of the lease-purchase payment.261.20EFFECTIVE DATE.This section is effective the day following final enactment.261.21    Sec. 21. LEGISLATIVE OFFICE FACILITIES.261.22(a) The commissioner of administration may enter into a long-term lease-purchase 261.23agreement for a term of up to 25 years, to predesign, design, construct, and equip offices, 261.24hearing rooms, and parking facilities for legislative and other functions. The facility must 261.25be located on the block bounded by Sherburne Avenue on the north, Park Street on the 261.26west, University Avenue on the south, and North Capitol Boulevard on the east. The 261.27legislative office facility must provide office accommodations for all senators and senate 261.28staff who do not have offices in the Capitol building and on-site parking facilities for all 261.29members and staff and disabled visitors to senate offices. A parking structure may also 261.30be built on the state-owned land located in the block bounded by Sherburne Avenue 261.31on the north, Park Street on the east, University Avenue on the south, and Rice Street 261.32on the west. The commissioner of management and budget may issue lease revenue 261.33bonds or certificates of participation associated with the lease-purchase agreement. The 261.34lease-purchase agreements must not be terminated, except for nonappropriation of 262.1money. The lease-purchase agreements must provide the state with a unilateral right to 262.2purchase the leased premises at specified times for specified amounts. The lease-purchase 262.3agreements are exempt from Minnesota Statutes, section 16B.24, subdivisions 6 and 6a.262.4(b) The facilities under the lease-purchase agreement are exempt from the design 262.5competition requirement under Minnesota Statutes, section 15B.10. Notwithstanding 262.6anything to the contrary under Minnesota Statutes, sections 16C.32 and 16C.33, if the 262.7commissioner of administration elects to use a design-build delivery method to design and 262.8construct one or more facilities under this appropriation, the Capitol Area Architectural and 262.9Planning Board, in cooperation with the commissioner, shall create a selection committee 262.10to act as the board under Minnesota Statutes, sections 16C.32 and 16C.33, for the design 262.11and construction of the facilities. Notwithstanding Minnesota Statutes, section 16B.33, if 262.12the commissioner elects to contract with a primary designer to design one or more facilities 262.13under this appropriation, the Capitol Area Architectural and Planning Board, in cooperation 262.14with the commissioner, shall create a selection committee to conduct the selection process 262.15in accordance with standards under Minnesota Statutes, chapters 15B, 16B, and 16C. A 262.16selection committee created under this section must contain no more than seven members, 262.17including at least three representatives designated by the senate Committee on Rules and 262.18Administration and three representatives designated by the speaker of the house.262.19(c) Notwithstanding any provision to the contrary in Minnesota Statutes, sections 262.2016C.32 and 16C.33, if the commissioner of administration elects to use a design-build 262.21delivery method to design, construct, and equip one or more facilities and associated 262.22infrastructure to provide audio and video broadcast services for the Capitol building, State 262.23Office Building, and a new legislative office building, if applicable, the commissioner 262.24shall create a selection committee to act as the board under Minnesota Statutes, sections 262.2516C.32 and 16C.33, to design, build, and equip the facilities. The selected design-builder 262.26may self-perform trade work or name an audio and video subcontractor as a member of 262.27the design-builder's team. If an audio and video subcontractor is named as a member of 262.28the design-builder's team, the design-builder is not required to competitively bid the trade 262.29work. Notwithstanding Minnesota Statutes, section 16C.33, subdivision 5, paragraph (b), 262.30after obtaining and evaluating qualifications from each design-builder, in accordance 262.31with the weighted criteria and subcriteria and procedures provided in the request for 262.32qualifications, the selection committee shall select a short list of up to five proposals. If 262.33the commissioner does not receive any proposals, the commissioner may either:262.34(1) solicit new proposals;262.35(2) revise the request for qualifications and thereafter solicit new proposals using 262.36the revised request for qualifications; or263.1(3) request selection of a primary designer under Minnesota Statutes, section 263.216B.33, 16C.08, or 16C.095, and proceed with competitive bidding pursuant to Minnesota 263.3Statutes, sections 16C.25 to 16C.29.263.4(d) The commissioner of administration may enter into a ground lease for state-owned 263.5property in the capitol area in conjunction with the execution of a lease-purchase 263.6agreement entered into under this section for any improvements constructed on that site. 263.7Notwithstanding the requirements of Minnesota Statutes, section 16A.695, subdivision 2, 263.8paragraph (b), the ground lease must be for a term equal to the term of the lease-purchase 263.9agreement, and must include an option to purchase the land at its then fair market value, if 263.10the improvements are not purchased by the state at the end of the term of the lease-purchase 263.11agreement, or at any earlier time that the lease-purchase agreement is terminated.263.12(e) The commissioner of administration must not prepare final plans and 263.13specifications for any construction authorized under this section until the program plan 263.14and cost estimates for all elements necessary to complete the project have been approved 263.15by the senate Committee on Rules and Administration.263.16(f) $3,000,000 is appropriated in fiscal year 2014 from the general fund to the 263.17commissioner of administration for predesign and design of facilities authorized under 263.18paragraph (a). This appropriation is available for expenditure the day following final 263.19enactment and until June 30, 2015.263.20(g) The commissioner of administration may reserve a portion of money from 263.21appropriations for office space costs of the legislature to fund future repairs for facilities 263.22constructed under the authority provided in this section. Money reserved under this 263.23paragraph must be credited to a segregated account for each building in the special 263.24revenue fund and is appropriated to the commissioner to make the repairs. When the state 263.25acquires title to a building with an account established under this paragraph, the account 263.26for that building must be abolished and the balance remaining in the account must be 263.27transferred to the appropriate asset preservation and replacement account.263.28EFFECTIVE DATE.This section is effective the day following final enactment.263.29    Sec. 22. APPROPRIATION; RELOCATION EXPENSES.263.30$1,860,000 is appropriated from the general fund to the commissioner of 263.31administration for rent loss and relocation expenses related to the Capitol renovation 263.32project for fiscal year 2014. Notwithstanding Minnesota Statutes, section 16A.642, 263.33this appropriation is available until June 30, 2015. The base for this appropriation is 263.34$1,380,000 in fiscal year 2016, $960,000 in fiscal year 2017, and $0 after that.264.1ARTICLE 13264.2MISCELLANEOUS PROVISIONS264.3    Section 1. Minnesota Statutes 2012, section 16A.727, is amended to read:264.416A.727 BACKUP REVENUES; FOOTBALL STADIUM FUNDING.264.5    (a) If the commissioner of management and budget determines that the amount of 264.6revenues under section 
         297E.021, subdivision 2, for the next fiscal year, plus $20,000,000,264.7 will be less than the amounts specified in section 
         297E.021, subdivision 3, paragraph (a),264.8 clause (1), items (i) to (iii), for that fiscal year, the commissioner may implement the 264.9revenue options authorized in Laws 2012, chapter 299, article 6; provided that this section 264.10does not constitute a pledge of tax revenues as security for the payment of principal and 264.11interest on appropriation bonds issued under section 
         16A.695. If the commissioner 264.12determines to exercise the authority under this section for a fiscal year, the commissioner 264.13must implement the revenue options, as necessary, in the following order:264.14    (1) a sports-themed lottery game under section 
         349A.20; and264.15(2) a tax on suites as provided under section 
         473J.14.264.16    (b) Revenue raised under the authority granted by this section must be deposited 264.17in the general fund.264.18    (c) If the commissioner determines to implement one or more of the revenue options 264.19authorized by this section, each subsequent year the commissioner must determine if 264.20the revenue is needed and will be imposed and collected for the next fiscal year. If the 264.21commissioner determines that one or more revenue options implemented for a fiscal year 264.22are not needed for a subsequent fiscal year, the commissioner must terminate them in the 264.23reverse order they were required to be implemented by paragraph (a) with the last option 264.24implemented terminated first and so forth.264.25    (d) Before implementing a revenue source authorized under this section, the 264.26commissioner must report the intent to do so to the Legislative Commission on Planning 264.27and Fiscal Policy. The commissioner must inform the commission of determinations to 264.28continue or discontinue each revenue source for a subsequent fiscal year.264.29(e) The provisions of this section no longer apply after the Minnesota Sports 264.30Facilities Authority certifies to the commissioner that it has determined that the revenues 264.31of the general fund under section 
         297A.994, the increased revenues under chapter 297E, 264.32and other available resources of the authority provide adequate financial security for 264.33the state and the authority.264.34EFFECTIVE DATE.This section is effective the day following final enactment.265.1    Sec. 2. [116V.03] APPROPRIATION.265.2$1,000,000 in fiscal year 2014 and each year thereafter is appropriated from the 265.3general fund to the commissioner of revenue for transfer to the agricultural project 265.4utilization account in the special revenue fund for the Agricultural Utilization Research 265.5Institute established under section 116V.01.265.6    Sec. 3. Minnesota Statutes 2012, section 237.52, subdivision 3, is amended to read:265.7    Subd. 3. Collection. Every provider of services capable of originating a TRS call, 265.8including cellular communications and other nonwire access services, in this state shall, 265.9except as provided in subdivision 3a, collect the charges established by the commission 265.10under subdivision 2 and transfer amounts collected to the commissioner of public 265.11safety in the same manner as provided in section 
         403.11, subdivision 1, paragraph (d). 265.12The commissioner of public safety must deposit the receipts in the fund established in 265.13subdivision 1.265.14EFFECTIVE DATE.This section is effective January 1, 2014.265.15    Sec. 4. Minnesota Statutes 2012, section 237.52, is amended by adding a subdivision 265.16to read:265.17    Subd. 3a.Fee for prepaid wireless telecommunications service.The fee 265.18established in subdivision 2 does not apply to prepaid wireless telecommunications 265.19services as defined in section 403.02, subdivision 17b, which are instead subject to the 265.20prepaid wireless telecommunications access Minnesota fee established in section 403.161, 265.21subdivision 1, paragraph (b). Collection, remittance, and deposit of prepaid wireless 265.22telecommunications access Minnesota fees are governed by sections 403.161 and 403.162.265.23EFFECTIVE DATE.This section is effective January 1, 2014.265.24    Sec. 5. Minnesota Statutes 2012, section 270B.01, subdivision 8, is amended to read:265.25    Subd. 8. Minnesota tax laws. For purposes of this chapter only, unless expressly 265.26stated otherwise, "Minnesota tax laws" means:265.27    (1) the taxes, refunds, and fees administered by or paid to the commissioner under 265.28chapters 115B, 289A (except taxes imposed under sections 
         298.01, 
         298.015, and 
         298.24), 265.29290, 290A, 291, 295, 297A, 297B, and 297H, and 403, or any similar Indian tribal tax 265.30administered by the commissioner pursuant to any tax agreement between the state and 265.31the Indian tribal government, and includes any laws for the assessment, collection, and 265.32enforcement of those taxes, refunds, and fees; and266.1    (2) section 
         273.1315.266.2EFFECTIVE DATE.This section is effective January 1, 2014.266.3    Sec. 6. Minnesota Statutes 2012, section 270B.12, subdivision 4, is amended to read:266.4    Subd. 4. Department of Public Safety. The commissioner may disclose return 266.5information to the Department of Public Safety for the purpose of and to the extent 266.6necessary to administer section sections 270C.725 and 403.16 to 403.162.266.7EFFECTIVE DATE.This section is effective January 1, 2014.266.8    Sec. 7. Minnesota Statutes 2012, section 270C.03, subdivision 1, is amended to read:266.9    Subdivision 1. Powers and duties. The commissioner shall have and exercise 266.10the following powers and duties:266.11    (1) administer and enforce the assessment and collection of taxes;266.12    (2) make determinations, corrections, and assessments with respect to taxes, 266.13including interest, additions to taxes, and assessable penalties;266.14    (3) use statistical or other sampling techniques consistent with generally accepted 266.15auditing standards in examining returns or records and making assessments;266.16    (4) investigate the tax laws of other states and countries, and formulate and submit 266.17to the legislature such legislation as the commissioner may deem expedient to prevent 266.18evasions of state revenue laws and to secure just and equal taxation and improvement in 266.19the system of state revenue laws;266.20    (5) consult and confer with the governor upon the subject of taxation, the 266.21administration of the laws in regard thereto, and the progress of the work of the 266.22department, and furnish the governor, from time to time, such assistance and information 266.23as the governor may require relating to tax matters;266.24    (6) execute and administer any agreement with the secretary of the treasury or the 266.25Bureau of Alcohol, Tobacco, Firearms and Explosives in the Department of Justice of the 266.26United States or a representative of another state regarding the exchange of information 266.27and administration of the state revenue laws;266.28    (7) require town, city, county, and other public officers to report information as to the 266.29collection of taxes received from licenses and other sources, and such other information 266.30as may be needful in the work of the commissioner, in such form as the commissioner 266.31may prescribe;266.32    (8) authorize the use of unmarked motor vehicles to conduct seizures or criminal 266.33investigations pursuant to the commissioner's authority;267.1    (9) authorize the participation in audits performed by the Multistate Tax Commission. 267.2For the purposes of chapter 270B, the Multistate Tax Commission will be considered to be 267.3a state for the purposes of auditing corporate sales, excise, and income tax returns.267.4    (10) maintain toll-free telephone access for taxpayer assistance for calls from 267.5locations within the state; and267.6    (10) (11) exercise other powers and authority and perform other duties required of or 267.7imposed upon the commissioner by law.267.8EFFECTIVE DATE.This section is effective the day following final enactment.267.9    Sec. 8. Minnesota Statutes 2012, section 271.06, subdivision 2a, as added by Laws 267.102013, chapter 36, section 1, is amended to read:267.11    Subd. 2a. Timely mailing treated as timely filing. (a) If, after the period prescribed 267.12by subdivision 2, the original notice of appeal, proof of service upon the commissioner, 267.13and filing fee are delivered by mail in the United States mail to the Tax Court administrator 267.14or the court administrator of district court acting as court administrator of the Tax Court, 267.15then the date of filing is the date of the United States postmark stamped on the envelope 267.16or other appropriate wrapper in which the notice of appeal, proof of service upon the 267.17commissioner, and filing fee are mailed.267.18(b) This subdivision applies only if the postmark date falls within the period 267.19prescribed by subdivision 2 and the original notice of appeal, proof of service upon the 267.20commissioner, and filing fee are, within the time prescribed by subdivision 2, deposited in 267.21the mail in the United States in an envelope or other appropriate wrapper, postage prepaid, 267.22properly addressed to the Tax Court administrator or the court administrator of district 267.23court acting as court administrator of the Tax Court.267.24(c) Only the postmark of the United States Postal Service qualifies as proof of 267.25timely mailing under this subdivision. Private postage meters do not qualify as proof of 267.26timely filing under this subdivision. If the original notice of appeal, proof of service 267.27upon the commissioner, and filing fee are sent by United States registered mail, the date 267.28of registration is the postmark date. If the original notice of appeal, proof of service 267.29upon the commissioner, and filing fee are sent by United States certified mail and the 267.30sender's receipt is postmarked by the postal employee to whom the envelope containing 267.31the original notice of appeal, proof of service upon the commissioner, and filing fee is 267.32presented, the date of the United States postmark on the receipt is the postmark date.267.33(d) A reference in this section to mail in the United States mail must be treated as 267.34including a reference to any designated delivery service and a reference in this section to 267.35a postmark by the United States Postal Service must be treated as including a reference 268.1to any date recorded or marked by any designated delivery service in accordance with 268.2section 7502(f) of the Internal Revenue Code.268.3EFFECTIVE DATE.This section is effective for filings delivered by the United 268.4States Postal Service with a postmark date after August 1, 2013.268.5    Sec. 9. Minnesota Statutes 2012, section 297E.021, subdivision 3, is amended to read:268.6    Subd. 3. Available revenues. For purposes of this section, "available revenues" 268.7equals the amount determined under subdivision 2, plus up to $20,000,000 each fiscal year 268.8from the taxes imposed under section 290.06, subdivision 1:268.9(1) reduced by the following amounts paid for the fiscal year under:268.10    (i) the appropriation to principal and interest on appropriation bonds under section 268.1116A.965, subdivision 8
         ;268.12    (ii) the appropriation from the general fund to make operating expense payments 268.13under section 
         473J.13, subdivision 2, paragraph (b);268.14    (iii) the appropriation for contributions to the capital reserve fund under section 268.15473J.13, subdivision 4
         , paragraph (c);268.16    (iv) the appropriations under Laws 2012, chapter 299, article 4, for administration 268.17and any successor appropriation;268.18    (v) the reduction in revenues resulting from the sales tax exemptions under section 268.19297A.71, subdivision 43
         ;268.20    (vi) reimbursements authorized by section 
         473J.15, subdivision 2, paragraph (d);268.21    (vii) the compulsive gambling appropriations under section 
         297E.02, subdivision 3, 268.22paragraph (c), and any successor appropriation; and268.23(viii) the appropriation for the city of St. Paul under section 
         16A.726, paragraph 268.24(c); and268.25    (2) increased by the revenue deposited in the general fund under section 
         297A.994, 268.26subdivision 4, clauses (1) to (3), for the fiscal year.268.27EFFECTIVE DATE.This section is effective the day following final enactment.268.28    Sec. 10. Minnesota Statutes 2012, section 403.02, is amended by adding a subdivision 268.29to read:268.30    Subd. 17b.Prepaid wireless telecommunications service."Prepaid wireless 268.31telecommunications service" means a wireless telecommunications service that allows the 268.32caller to dial 911 to access the 911 system, which service must be paid for in advance and is:269.1(1) sold in predetermined units or dollars of which the number declines with use in a 269.2known amount; or269.3(2) provides unlimited use for a predetermined time period.269.4The inclusion of nontelecommunications services, including the download of digital 269.5products delivered electronically, content, and ancillary services, with a prepaid wireless 269.6telecommunications service does not preclude that service from being considered a 269.7prepaid wireless telecommunications service under this chapter.269.8EFFECTIVE DATE.This section is effective January 1, 2014.269.9    Sec. 11. Minnesota Statutes 2012, section 403.02, is amended by adding a subdivision 269.10to read:269.11    Subd. 20a.Wireless telecommunications service.Wireless telecommunications 269.12service means a commercial mobile radio service, as that term is defined in United 269.13States Code, title 47, section 332, subsection (d), including all broadband personal 269.14communication services, wireless radio telephone services, and geographic area 269.15specialized mobile radio licensees, that offer real-time, two-way voice service 269.16interconnected with the public switched telephone network.269.17EFFECTIVE DATE.This section is effective January 1, 2014.269.18    Sec. 12. Minnesota Statutes 2012, section 403.02, subdivision 21, is amended to read:269.19    Subd. 21. Wireless telecommunications service provider. "Wireless 269.20telecommunications service provider" means a provider of commercial mobile radio 269.21services, as that term is defined in United States Code, title 47, section 332, subsection 269.22(d), including all broadband personal communications services, wireless radio telephone 269.23services, geographic area specialized and enhanced specialized mobile radio services, and 269.24incumbent wide area specialized mobile radio licensees, that offers real-time, two-way 269.25voice service interconnected with the public switched telephone network and that is doing 269.26business in the state of Minnesota wireless telecommunications service.269.27EFFECTIVE DATE.This section is effective January 1, 2014.269.28    Sec. 13. Minnesota Statutes 2012, section 403.06, subdivision 1a, is amended to read:269.29    Subd. 1a. Biennial budget; annual financial report. The commissioner shall 269.30prepare a biennial budget for maintaining the 911 system. By December 15 of each year, 269.31the commissioner shall submit a report to the legislature detailing the expenditures for 269.32maintaining the 911 system, the 911 fees collected, the balance of the 911 fund, and the 270.1911-related administrative expenses of the commissioner, and the most recent forecast of 270.2revenues and expenditures for the 911 emergency telecommunications service account, 270.3including a separate projection of E911 fees from prepaid wireless customers and 270.4projections of year-end fund balances. The commissioner is authorized to expend money 270.5that has been appropriated to pay for the maintenance, enhancements, and expansion 270.6of the 911 system.270.7EFFECTIVE DATE.This section is effective the day following final enactment.270.8    Sec. 14. Minnesota Statutes 2012, section 403.11, subdivision 1, is amended to read:270.9    Subdivision 1. Emergency telecommunications service fee; account. (a) Each 270.10customer of a wireless or wire-line switched or packet-based telecommunications service 270.11provider connected to the public switched telephone network that furnishes service capable 270.12of originating a 911 emergency telephone call is assessed a fee based upon the number 270.13of wired or wireless telephone lines, or their equivalent, to cover the costs of ongoing 270.14maintenance and related improvements for trunking and central office switching equipment 270.15for 911 emergency telecommunications service, to offset administrative and staffing costs 270.16of the commissioner related to managing the 911 emergency telecommunications service 270.17program, to make distributions provided for in section 
         403.113, and to offset the costs, 270.18including administrative and staffing costs, incurred by the State Patrol Division of the 270.19Department of Public Safety in handling 911 emergency calls made from wireless phones.270.20    (b) Money remaining in the 911 emergency telecommunications service account 270.21after all other obligations are paid must not cancel and is carried forward to subsequent 270.22years and may be appropriated from time to time to the commissioner to provide financial 270.23assistance to counties for the improvement of local emergency telecommunications 270.24services. The improvements may include providing access to 911 service for 270.25telecommunications service subscribers currently without access and upgrading existing 270.26911 service to include automatic number identification, local location identification, 270.27automatic location identification, and other improvements specified in revised county 270.28911 plans approved by the commissioner.270.29    (c) The fee may not be less than eight cents nor more than 65 cents a month until 270.30June 30, 2008, not less than eight cents nor more than 75 cents a month until June 30, 270.312009, not less than eight cents nor more than 85 cents a month until June 30, 2010, and 270.32not less than eight cents nor more than 95 cents a month on or after July 1, 2010, for 270.33each customer access line or other basic access service, including trunk equivalents as 270.34designated by the Public Utilities Commission for access charge purposes and including 270.35wireless telecommunications services. With the approval of the commissioner of 271.1management and budget, the commissioner of public safety shall establish the amount of 271.2the fee within the limits specified and inform the companies and carriers of the amount to 271.3be collected. When the revenue bonds authorized under section 
         403.27, subdivision 1, 271.4have been fully paid or defeased, the commissioner shall reduce the fee to reflect that debt 271.5service on the bonds is no longer needed. The commissioner shall provide companies and 271.6carriers a minimum of 45 days' notice of each fee change. The fee must be the same for all 271.7customers, except that the fee imposed under  this subdivision does not apply to prepaid 271.8wireless telecommunications service, which is instead subject to the fee imposed under 271.9section 403.161, subdivision 1, paragraph (a).271.10    (d) The fee must be collected by each wireless or wire-line telecommunications 271.11service provider subject to the fee. Fees are payable to and must be submitted to the 271.12commissioner monthly before the 25th of each month following the month of collection, 271.13except that fees may be submitted quarterly if less than $250 a month is due, or annually if 271.14less than $25 a month is due. Receipts must be deposited in the state treasury and credited 271.15to a 911 emergency telecommunications service account in the special revenue fund. The 271.16money in the account may only be used for 911 telecommunications services.271.17    (e) This subdivision does not apply to customers of interexchange carriers.271.18    (f) The installation and recurring charges for integrating wireless 911 calls into 271.19enhanced 911 systems are eligible for payment by the commissioner if the 911 service 271.20provider is included in the statewide design plan and the charges are made pursuant to 271.21contract.271.22    (g) Competitive local exchanges carriers holding certificates of authority from the 271.23Public Utilities Commission are eligible to receive payment for recurring 911 services.271.24EFFECTIVE DATE.This section is effective January 1, 2014.271.25    Sec. 15. Minnesota Statutes 2012, section 403.11, is amended by adding a subdivision 271.26to read:271.27    Subd. 3d.Eligible telecommunications carrier; requirement.No wireless 271.28communications provider may provide telecommunications services under a designation 271.29of eligible telecommunications carrier, as provided under Minnesota Rule 7811.1400, 271.30until and unless the commissioner of public safety certifies to the chair of the public 271.31utilities commission that the wireless telecommunications provider is not in arrears in 271.32amounts owed to the 911 emergency telecommunications service account in the special 271.33revenue fund.271.34EFFECTIVE DATE.This section is effective the day following final enactment.272.1    Sec. 16. Minnesota Statutes 2012, section 403.11, is amended by adding a subdivision 272.2to read:272.3    Subd. 6.Report.(a) Beginning September 1, 2013, and continuing semiannually 272.4thereafter, each wireless telecommunications service provider shall report to the 272.5commissioner, based on the mobile telephone number, both the total number of prepaid 272.6wireless telecommunications subscribers sourced to Minnesota and the total number of 272.7wireless telecommunications subscribers sourced to Minnesota. The report must be filed 272.8on the same schedule as Federal Communications Commission Form 477.272.9(b) The commissioner shall make a standard form available to all wireless 272.10telecommunications service providers for submitting information required to compile 272.11the report required under this subdivision.272.12(c) The information provided to the commissioner under this subdivision is 272.13considered trade secret information under section 13.37 and may only be used for purposes 272.14of administering this chapter.272.15EFFECTIVE DATE.This section is effective January 1, 2014.272.16    Sec. 17. [403.16] DEFINITIONS.272.17    Subdivision 1.Scope.For the purposes of sections 403.16 to 403.164, the terms 272.18defined in this section have the meanings given them.272.19    Subd. 2.Consumer."Consumer" means a person who purchases prepaid wireless 272.20telecommunications service in a retail transaction.272.21    Subd. 3.Department."Department" means the Department of Revenue.272.22    Subd. 4.Prepaid wireless E911 fee."Prepaid wireless E911 fee" means the fee that 272.23is required to be collected by a seller from a consumer as established in section 403.161, 272.24subdivision 1, paragraph (a).272.25    Subd. 5.Prepaid wireless telecommunications access Minnesota fee."Prepaid 272.26wireless telecommunications access Minnesota fee" means the fee that is required to be 272.27collected by a seller from a consumer as established in section 403.161, subdivision 1, 272.28paragraph (b).272.29    Subd. 6.Provider."Provider" means a person that provides prepaid wireless 272.30telecommunications service under a license issued by the Federal Communications 272.31Commission.272.32    Subd. 7.Retail transaction."Retail transaction" means the purchase of prepaid 272.33wireless telecommunications service from a seller for any purpose other than resale.272.34    Subd. 8.Seller."Seller" means a person who sells prepaid wireless 272.35telecommunications service to another person.273.1EFFECTIVE DATE.This section is effective January 1, 2014.273.2    Sec. 18. [403.161] PREPAID WIRELESS FEES IMPOSED; COLLECTION; 273.3REMITTANCE.273.4    Subdivision 1.Fees imposed.(a) A prepaid wireless E911 fee of 80 cents per retail 273.5transaction is imposed on prepaid wireless telecommunications service until the fee is 273.6adjusted as an amount per retail transaction under subdivision 7.273.7(b) A prepaid wireless telecommunications access Minnesota fee, in the amount of 273.8the monthly charge provided for in section 237.52, subdivision 2, is imposed on each 273.9retail transaction for prepaid wireless telecommunications service until the fee is adjusted 273.10as an amount per retail transaction under subdivision 7.273.11    Subd. 2.Exemption.The fees established under subdivision 1 are not imposed on a 273.12minimal amount of prepaid wireless telecommunications service that is sold with a prepaid 273.13wireless device and is charged a single nonitemized price, and a seller may not apply the 273.14fees to such a transaction. For purposes of this subdivision, a minimal amount of service 273.15means an amount of service denominated as either ten minutes or less or $5 or less.273.16    Subd. 3.Fee collected.The prepaid wireless E911 and telecommunications 273.17access Minnesota fees must be collected by the seller from the consumer for each retail 273.18transaction occurring in this state. The amount of each fee must be combined into one 273.19amount, which must be separately stated on an invoice, receipt, or other similar document 273.20that is provided to the consumer by the seller.273.21    Subd. 4.Sales and use tax treatment.For purposes of this section, a retail 273.22transaction conducted in person by a consumer at a business location of the seller must 273.23be treated as occurring in this state if that business location is in this state, and any other 273.24retail transaction must be treated as occurring in this state if the retail transaction is treated 273.25as occurring in this state for purposes of the sales and use tax as specified in section 273.26297A.669, subdivision 3, paragraph (c).273.27    Subd. 5.Remittance.The prepaid wireless E911 and telecommunications access 273.28Minnesota fees are the liability of the consumer and not of the seller or of any provider, 273.29except that the seller is liable to remit all fees as provided in section 403.162.273.30    Subd. 6.Exclusion for calculating other charges.The combined amount of the 273.31prepaid wireless E911 and telecommunications access Minnesota fees collected by a seller 273.32from a consumer must not be included in the base for measuring any tax, fee, surcharge, 273.33or other charge that is imposed by this state, any political subdivision of this state, or 273.34any intergovernmental agency.274.1    Subd. 7.Fee changes.(a) The prepaid wireless E911 and telecommunications 274.2access Minnesota fee must be proportionately increased or reduced upon any change to 274.3the fee imposed under section 403.11, subdivision 1, paragraph (c), after July 1, 2013, or 274.4the fee imposed under section 237.52, subdivision 2, as applicable.274.5(b) The department shall post notice of any fee changes on its Web site at least 30 274.6days in advance of the effective date of the fee changes. It is the responsibility of sellers to 274.7monitor the department's Web site for notice of fee changes.274.8(c) Fee changes are effective 60 days after the first day of the first calendar month 274.9after the commissioner of public safety or the Public Utilities Commission, as applicable, 274.10changes the fee.274.11EFFECTIVE DATE.This section is effective January 1, 2014.274.12    Sec. 19. [403.162] ADMINISTRATION OF PREPAID WIRELESS E911 FEES.274.13    Subdivision 1.Remittance.Prepaid wireless E911 and telecommunications access 274.14Minnesota fees collected by sellers must be remitted to the commissioner of revenue 274.15at the times and in the manner provided by chapter 297A with respect to the general 274.16sales and use tax. The commissioner of revenue shall establish registration and payment 274.17procedures that substantially coincide with the registration and payment procedures that 274.18apply in chapter 297A.274.19    Subd. 2.Seller's fee retention.A seller may deduct and retain three percent of 274.20prepaid wireless E911 and telecommunications access Minnesota fees collected by the 274.21seller from consumers.274.22    Subd. 3.Department of Revenue provisions.The audit, assessment, appeal, 274.23collection, refund, penalty, interest, enforcement, and administrative provisions of 274.24chapters 270C and 289A that are applicable to the taxes imposed by chapter 297A apply 274.25to any fee imposed under section 403.161.274.26    Subd. 4.Procedures for resale transactions.The commissioner of revenue shall 274.27establish procedures by which a seller of prepaid wireless telecommunications service 274.28may document that a sale is not a retail transaction. These procedures must substantially 274.29coincide with the procedures for documenting sale for resale transactions as provided in 274.30chapter 297A.274.31    Subd. 5.Fees deposited.(a) The commissioner of revenue shall, based on 274.32the relative proportion of the prepaid wireless E911 fee and the prepaid wireless 274.33telecommunications access Minnesota fee imposed per retail transaction, divide the fees 274.34collected in corresponding proportions. Within 30 days of receipt of the collected fees, 274.35the commissioner shall:275.1(1) deposit the proportion of the collected fees attributable to the prepaid wireless 275.2E911 fee in the 911 emergency telecommunications service account in the special revenue 275.3fund; and275.4(2) deposit the proportion of collected fees attributable to the prepaid wireless 275.5telecommunications access Minnesota fee in the telecommunications access fund 275.6established in section 237.52, subdivision 1.275.7(b) The department may deduct and retain an amount, not to exceed two percent of 275.8collected fees, to reimburse its direct costs of administering the collection and remittance 275.9of prepaid wireless E911 fees and prepaid wireless telecommunications access Minnesota 275.10fees.275.11EFFECTIVE DATE.This section is effective January 1, 2014.275.12    Sec. 20. [403.163] LIABILITY PROTECTION FOR SELLERS AND 275.13PROVIDERS.275.14(a) A provider or seller of prepaid wireless telecommunications service is not liable 275.15for damages to any person resulting from or incurred in connection with providing any 275.16lawful assistance in good faith to any investigative or law enforcement officer of the 275.17United States, this or any other state, or any political subdivision of this or any other state.275.18(b) In addition to the protection from liability provided by paragraph (a), section 275.19403.08, subdivision 11, applies to sellers and providers.275.20EFFECTIVE DATE.This section is effective the day following final enactment.275.21    Sec. 21. [403.164] EXCLUSIVITY OF PREPAID WIRELESS E911 FEE.275.22The prepaid wireless E911 fee imposed by section 403.161 is the only E911 funding 275.23obligation imposed with respect to prepaid wireless telecommunications service in this 275.24state, and no tax, fee, surcharge, or other charge may be imposed by this state, any political 275.25subdivision of this state, or any intergovernmental agency, for E911 funding purposes, 275.26upon any provider, seller, or consumer with respect to the sale, purchase, use, or provision 275.27of prepaid wireless telecommunications service.275.28EFFECTIVE DATE.This section is effective January 1, 2014.275.29    Sec. 22. PURPOSE STATEMENTS; TAX EXPENDITURES.275.30    Subdivision 1.Authority.This section is intended to fulfill the requirement under 275.31Minnesota Statutes, section 3.192, that a bill creating, renewing, or continuing a tax 276.1expenditure provide a purpose for the tax expenditure and a standard or goal against 276.2which its effectiveness may be measured.276.3    Subd. 2.Federal conformity.The provisions of article 6 conforming Minnesota 276.4individual income tax to changes in federal law related to bonus depreciation and section 276.5179 expensing are intended to simplify compliance with and administration of the 276.6individual income tax.276.7    Subd. 3.Sales tax exemption for certain aircraft parts and labor.The provisions 276.8of article 5 exempting parts and labor for certain aircraft, is intended to encourage the 276.9growth of the aviation services industry in the state.276.10    Subd. 4.Railroad track maintenance subtraction.The provisions of article 6 276.11allowing an individual income and corporate franchise tax subtraction for the amount 276.12allowed under the federal credit for railroad maintenance expenses, are intended to 276.13increase the combined federal and state tax incentives available to Class II and Class III 276.14railroads for maintaining and upgrading track in Minnesota. The standard against which 276.15effectiveness is to be measured is the additional miles of track maintained or upgraded 276.16following allowance of the state tax subtraction in addition to the existing federal tax credit.276.17    Subd. 5.Historic structure rehabilitation credit.The provisions of article 6 276.18extending the sunset date of the historic structure rehabilitation credit and modifying 276.19the effective date of the credit, are intended to encourage the preservation of historic 276.20structures in Minnesota and to create and retain jobs related to rehabilitation of historic 276.21structures in the state. The standard against which the effectiveness of the extension 276.22of the credit and modification of the effective date is to be measured is the number of 276.23jobs created through the rehabilitation of historic structures and the number of historic 276.24structures rehabilitated and placed in service.276.25    Subd. 6.Greater Minnesota internship credit.The provisions of article 6 276.26providing a tax credit to employers of qualified interns, are intended to encourage 276.27Minnesota businesses to employ and provide valuable education and work experience 276.28to Minnesota students and foster long-term relationships between students and greater 276.29Minnesota employers. The standard against which the effectiveness of the extension of the 276.30credit is the number of students who participated in the program who were subsequently 276.31employed full time by the employer.277.1    Subd. 7.Sales tax exemption for greater Minnesota business expansion.The 277.2provisions of article 8 are intended to induce existing businesses in greater Minnesota to 277.3increase investment and expand employment in greater Minnesota.277.4    Subd. 8.Expansion of sales tax exemption on durable medical products and 277.5prosthetics.The provisions of article 8 expanding the definition of items included in 277.6repair and replacement parts of durable medical equipment and prosthetics and exempting 277.7Medicare and medicaid purchases is intended to simplify sales tax administration in this 277.8area and provide relief for sellers who cannot collect the tax under these programs.277.9    Subd. 9.Sales tax exemption for established religious orders.The provisions 277.10of article 8 exempting certain sales between a religious order and an affiliated institute 277.11of higher education, is intended to retain an existing sales tax exemption that exists 277.12between St. John's Abbey and St. John's University after a governing restructure between 277.13the two entities.277.14    Subd. 10.Sales tax exemption for certain dental providers.The provisions 277.15of article 8 exempting certain purchases by qualifying critical access dental providers, 277.16is intended to assist critical access dental providers in defraying the overall cost of the 277.17services they provide to underserved communities.277.18    Subd. 11.Sales tax exemption for nursing homes and boarding care homes.277.19The provisions of article 8 exempting certain nursing homes and boarding care homes is 277.20intended to clarify that an existing exemption for these facilities is not affected by a recent 277.21property tax case related to defining nonprofit organizations engaged in charitable activities.277.22    Subd. 12.Construction sales tax exemptions.The provisions of article 8 277.23exempting from sales tax construction materials for various entities, are intended to 277.24increase jobs and reduce tax pyramiding by reducing the tax on inputs used to provide 277.25taxable goods and services.277.26    Subd. 13.Sales tax exemption on certain public infrastructure.The provisions 277.27of article 10 exempting construction materials used in public infrastructure projects related 277.28to the destination medical center plan is intended to reduce city costs for those projects.277.29EFFECTIVE DATE.This section is effective the day following final enactment.277.30    Sec. 23. APPROPRIATIONS.278.1(a) $950,000 is appropriated from the general fund to the commissioner of revenue 278.2in fiscal year 2014 for administering this act. This appropriation does not cancel but is 278.3available until June 30, 2015. $300,000 of this amount is added to the annual base budget.278.4(b) $25,000 in fiscal year 2014 and $25,000 in fiscal year 2015 are appropriated 278.5from the general fund to the commissioner of employment and economic development for 278.6administering the provisions of article 10.278.7EFFECTIVE DATE.This section is effective the day following final enactment.278.8    Sec. 24.  REPEALER.278.9Minnesota Statutes 2012, sections 290.171; 290.173; and 290.174, are repealed.278.10ARTICLE 14278.11MARKET VALUE DEFINITIONS278.12    Section 1. Minnesota Statutes 2012, section 38.18, is amended to read:278.1338.18 COUNTY FAIRGROUNDS; IMPROVEMENT AIDED.278.14    Any Each town, statutory city, or school district in this state, now or hereafter at any 278.15time having a an estimated market value of all its taxable property, exclusive of money and 278.16credits, of more than $105,000,000, and having a county fair located within its corporate 278.17limits, is hereby authorized to aid in defraying may pay part of the expense of improving 278.18any such the fairground, by appropriating and paying over to the treasurer of the county 278.19owning the fairground such sum of money, not exceeding $10,000, for each of the political 278.20subdivisions, as the its governing body of the town, statutory city, or school district may, 278.21by resolution, determine determines to be for the best interest of the political subdivision,.278.22 The sums so appropriated to amounts paid to the county must be used solely for the purpose 278.23of aiding in the improvement of to improve the fairground in such the manner as the county 278.24board of the county shall determine determines to be for the best interest of the county.278.25    Sec. 2. Minnesota Statutes 2012, section 40A.15, subdivision 2, is amended to read:278.26    Subd. 2. Eligible recipients. All counties within the state, municipalities that prepare 278.27plans and official controls instead of a county, and districts are eligible for assistance 278.28under the program. Counties and districts may apply for assistance on behalf of other 278.29municipalities. In order to be eligible for financial assistance a county or municipality must 278.30agree to levy at least 0.01209 percent of taxable estimated market value for agricultural 278.31land preservation and conservation activities or otherwise spend the equivalent amount of 278.32local money on those activities, or spend $15,000 of local money, whichever is less.279.1    Sec. 3. Minnesota Statutes 2012, section 69.011, subdivision 1, is amended to read:279.2    Subdivision 1. Definitions. Unless the language or context clearly indicates that 279.3a different meaning is intended, the following words and terms, for the purposes of this 279.4chapter and chapters 423, 423A, 424 and 424A, have the meanings ascribed to them:279.5    (a) "Commissioner" means the commissioner of revenue.279.6    (b) "Municipality" means:279.7    (1) a home rule charter or statutory city;279.8    (2) an organized town;279.9    (3) a park district subject to chapter 398;279.10    (4) the University of Minnesota;279.11    (5) for purposes of the fire state aid program only, an American Indian tribal 279.12government entity located within a federally recognized American Indian reservation;279.13    (6) for purposes of the police state aid program only, an American Indian tribal 279.14government with a tribal police department which exercises state arrest powers under 279.15section 
         626.90, 
         626.91, 
         626.92, or 
         626.93;279.16    (7) for purposes of the police state aid program only, the Metropolitan Airports 279.17Commission; and279.18    (8) for purposes of the police state aid program only, the Department of Natural 279.19Resources and the Department of Public Safety with respect to peace officers covered 279.20under chapter 352B.279.21    (c) "Minnesota Firetown Premium Report" means a form prescribed by the 279.22commissioner containing space for reporting by insurers of fire, lightning, sprinkler 279.23leakage and extended coverage premiums received upon risks located or to be performed 279.24in this state less return premiums and dividends.279.25    (d) "Firetown" means the area serviced by any municipality having a qualified fire 279.26department or a qualified incorporated fire department having a subsidiary volunteer 279.27firefighters' relief association.279.28    (e) "Estimated market value" means latest available estimated market value of all 279.29property in a taxing jurisdiction, whether the property is subject to taxation, or exempt 279.30from ad valorem taxation obtained from information which appears on abstracts filed with 279.31the commissioner of revenue or equalized by the State Board of Equalization.279.32    (f) "Minnesota Aid to Police Premium Report" means a form prescribed by the 279.33commissioner for reporting by each fire and casualty insurer of all premiums received 279.34upon direct business received by it in this state, or by its agents for it, in cash or otherwise, 279.35during the preceding calendar year, with reference to insurance written for insuring against 279.36the perils contained in auto insurance coverages as reported in the Minnesota business 280.1schedule of the annual financial statement which each insurer is required to file with 280.2the commissioner in accordance with the governing laws or rules less return premiums 280.3and dividends.280.4    (g) "Peace officer" means any person:280.5    (1) whose primary source of income derived from wages is from direct employment 280.6by a municipality or county as a law enforcement officer on a full-time basis of not less 280.7than 30 hours per week;280.8    (2) who has been employed for a minimum of six months prior to December 31 280.9preceding the date of the current year's certification under subdivision 2, clause (b);280.10    (3) who is sworn to enforce the general criminal laws of the state and local ordinances;280.11    (4) who is licensed by the Peace Officers Standards and Training Board and is 280.12authorized to arrest with a warrant; and280.13    (5) who is a member of the State Patrol retirement plan or the public employees 280.14police and fire fund.280.15    (h) "Full-time equivalent number of peace officers providing contract service" means 280.16the integral or fractional number of peace officers which would be necessary to provide 280.17the contract service if all peace officers providing service were employed on a full-time 280.18basis as defined by the employing unit and the municipality receiving the contract service.280.19    (i) "Retirement benefits other than a service pension" means any disbursement 280.20authorized under section 
         424A.05, subdivision 3, clauses (3) and (4).280.21    (j) "Municipal clerk, municipal clerk-treasurer, or county auditor" means:280.22    (1) for the police state aid program and police relief association financial reports:280.23    (i) the person who was elected or appointed to the specified position or, in the 280.24absence of the person, another person who is designated by the applicable governing body;280.25    (ii) in a park district, the secretary of the board of park district commissioners;280.26    (iii) in the case of the University of Minnesota, the official designated by the Board 280.27of Regents;280.28    (iv) for the Metropolitan Airports Commission, the person designated by the 280.29commission;280.30    (v) for the Department of Natural Resources or the Department of Public Safety, the 280.31respective commissioner;280.32    (vi) for a tribal police department which exercises state arrest powers under section 280.33626.90
         , 
         626.91, 
         626.92, or 
         626.93, the person designated by the applicable American 280.34Indian tribal government; and280.35    (2) for the fire state aid program and fire relief association financial reports, the 280.36person who was elected or appointed to the specified position, or, for governmental 281.1entities other than counties, if the governing body of the governmental entity designates 281.2the position to perform the function, the chief financial official of the governmental entity 281.3or the chief administrative official of the governmental entity.281.4    (k) "Voluntary statewide lump-sum volunteer firefighter retirement plan" means the 281.5retirement plan established by chapter 353G.281.6    Sec. 4. Minnesota Statutes 2012, section 69.021, subdivision 7, is amended to read:281.7    Subd. 7. Apportionment of fire state aid to municipalities and relief associations.281.8    (a) The commissioner shall apportion the fire state aid relative to the premiums reported 281.9on the Minnesota Firetown Premium Reports filed under this chapter to each municipality 281.10and/or firefighters relief association.281.11    (b) The commissioner shall calculate an initial fire state aid allocation amount for 281.12each municipality or fire department under paragraph (c) and a minimum fire state aid 281.13allocation amount for each municipality or fire department under paragraph (d). The 281.14municipality or fire department must receive the larger fire state aid amount.281.15    (c) The initial fire state aid allocation amount is the amount available for 281.16apportionment as fire state aid under subdivision 5, without inclusion of any additional 281.17funding amount to support a minimum fire state aid amount under section 
         423A.02, 281.18subdivision 3
         , allocated one-half in proportion to the population as shown in the last official 281.19statewide federal census for each fire town and one-half in proportion to the estimated 281.20market value of each fire town, including (1) the estimated market value of tax-exempt 281.21property and (2) the estimated market value of natural resources lands receiving in lieu 281.22payments under sections 
         477A.11 to 
         477A.14, but excluding the estimated market value 281.23of minerals. In the case of incorporated or municipal fire departments furnishing fire 281.24protection to other cities, towns, or townships as evidenced by valid fire service contracts 281.25filed with the commissioner, the distribution must be adjusted proportionately to take 281.26into consideration the crossover fire protection service. Necessary adjustments must be 281.27made to subsequent apportionments. In the case of municipalities or independent fire 281.28departments qualifying for the aid, the commissioner shall calculate the state aid for the 281.29municipality or relief association on the basis of the population and the estimated market 281.30value of the area furnished fire protection service by the fire department as evidenced by 281.31duly executed and valid fire service agreements filed with the commissioner. If one or 281.32more fire departments are furnishing contracted fire service to a city, town, or township, 281.33only the population and estimated market value of the area served by each fire department 281.34may be considered in calculating the state aid and the fire departments furnishing service 281.35shall enter into an agreement apportioning among themselves the percent of the population 282.1and the estimated market value of each service area. The agreement must be in writing 282.2and must be filed with the commissioner.282.3    (d) The minimum fire state aid allocation amount is the amount in addition to the 282.4initial fire state allocation amount that is derived from any additional funding amount 282.5to support a minimum fire state aid amount under section 
         423A.02, subdivision 3, and 282.6allocated to municipalities with volunteer firefighters relief associations or covered by the 282.7voluntary statewide lump-sum volunteer firefighter retirement plan based on the number 282.8of active volunteer firefighters who are members of the relief association as reported 282.9in the annual financial reporting for the calendar year 1993 to the Office of the State 282.10Auditor, but not to exceed 30 active volunteer firefighters, so that all municipalities or 282.11fire departments with volunteer firefighters relief associations receive in total at least a 282.12minimum fire state aid amount per 1993 active volunteer firefighter to a maximum of 282.1330 firefighters. If a relief association is established after calendar year 1993 and before 282.14calendar year 2000, the number of active volunteer firefighters who are members of the 282.15relief association as reported in the annual financial reporting for calendar year 1998 282.16to the Office of the State Auditor, but not to exceed 30 active volunteer firefighters, 282.17shall be used in this determination. If a relief association is established after calendar 282.18year 1999, the number of active volunteer firefighters who are members of the relief 282.19association as reported in the first annual financial reporting submitted to the Office of 282.20the State Auditor, but not to exceed 20 active volunteer firefighters, must be used in this 282.21determination. If a relief association is terminated as a result of providing retirement 282.22coverage for volunteer firefighters by the voluntary statewide lump-sum volunteer 282.23firefighter retirement plan under chapter 353G, the number of active volunteer firefighters 282.24of the municipality covered by the statewide plan as certified by the executive director of 282.25the Public Employees Retirement Association to the commissioner and the state auditor, 282.26but not to exceed 30 active firefighters, must be used in this determination.282.27    (e) Unless the firefighters of the applicable fire department are members of the 282.28voluntary statewide lump-sum volunteer firefighter retirement plan, the fire state aid must 282.29be paid to the treasurer of the municipality where the fire department is located and the 282.30treasurer of the municipality shall, within 30 days of receipt of the fire state aid, transmit 282.31the aid to the relief association if the relief association has filed a financial report with the 282.32treasurer of the municipality and has met all other statutory provisions pertaining to the 282.33aid apportionment. If the firefighters of the applicable fire department are members of 282.34the voluntary statewide lump-sum volunteer firefighter retirement plan, the fire state aid 282.35must be paid to the executive director of the Public Employees Retirement Association 282.36and deposited in the voluntary statewide lump-sum volunteer firefighter retirement fund.283.1    (f) The commissioner may make rules to permit the administration of the provisions 283.2of this section.283.3    (g) Any adjustments needed to correct prior misallocations must be made to 283.4subsequent apportionments.283.5    Sec. 5. Minnesota Statutes 2012, section 69.021, subdivision 8, is amended to read:283.6    Subd. 8. Population and estimated market value. (a) In computations relating to 283.7fire state aid requiring the use of population figures, only official statewide federal census 283.8figures are to be used. Increases or decreases in population disclosed by reason of any 283.9special census must not be taken into consideration.283.10    (b) In calculations relating to fire state aid requiring the use of estimated market 283.11value property figures, only the latest available estimated market value property figures 283.12may be used.283.13    Sec. 6. Minnesota Statutes 2012, section 88.51, subdivision 3, is amended to read:283.14    Subd. 3. Determination of estimated market value. In determining the net tax 283.15capacity of property within any taxing district the value of the surface of lands within any 283.16auxiliary forest therein, as determined by the county board under the provisions of section 283.1788.48, subdivision 3
         , shall, for all purposes except the levying of taxes on lands within any 283.18such forest, be deemed the estimated market value thereof.283.19    Sec. 7. Minnesota Statutes 2012, section 103B.245, subdivision 3, is amended to read:283.20    Subd. 3. Tax. After adoption of the ordinance under subdivision 2, a local 283.21government unit may annually levy a tax on all taxable property in the district for the 283.22purposes for which the tax district is established. The tax may not exceed 0.02418 percent 283.23of estimated market value on taxable property located in rural towns other than urban 283.24towns, unless allowed by resolution of the town electors. The proceeds of the tax shall 283.25be paid into a fund reserved for these purposes. Any proceeds remaining in the reserve 283.26fund at the time the tax is terminated or the district is dissolved shall be transferred and 283.27irrevocably pledged to the debt service fund of the local unit to be used solely to reduce 283.28tax levies for bonded indebtedness of taxable property in the district.283.29    Sec. 8. Minnesota Statutes 2012, section 103B.251, subdivision 8, is amended to read:283.30    Subd. 8. Tax. (a) For the payment of principal and interest on the bonds issued 283.31under subdivision 7 and the payment required under subdivision 6, the county shall 283.32irrevocably pledge and appropriate the proceeds of a tax levied on all taxable property 284.1located within the territory of the watershed management organization or subwatershed 284.2unit for which the bonds are issued. Each year until the reserve for payment of the bonds 284.3is sufficient to retire the bonds, the county shall levy on all taxable property in the territory 284.4of the organization or unit, without respect to any statutory or other limitation on taxes, an 284.5amount of taxes sufficient to pay principal and interest on the bonds and to restore any 284.6deficiencies in reserves required to be maintained for payment of the bonds.284.7    (b) The tax levied on rural towns other than urban towns may not exceed 0.02418 284.8percent of taxableestimated market value, unless approved by resolution of the town 284.9electors.284.10    (c) If at any time the amounts available from the levy on property in the territory of 284.11the organization are insufficient to pay principal and interest on the bonds when due, the 284.12county shall make payment from any available funds in the county treasury.284.13    (d) The amount of any taxes which are required to be levied outside of the territory 284.14of the watershed management organization or unit or taken from the general funds of the 284.15county to pay principal or interest on the bonds shall be reimbursed to the county from 284.16taxes levied within the territory of the watershed management organization or unit.284.17    Sec. 9. Minnesota Statutes 2012, section 103B.635, subdivision 2, is amended to read:284.18    Subd. 2. Municipal funding of district. (a) The governing body or board of 284.19supervisors of each municipality in the district must provide the funds necessary to meet 284.20its proportion of the total cost determined by the board, provided the total funding from 284.21all municipalities in the district for the costs shall not exceed an amount equal to .00242 284.22percent of the total taxable estimated market value within the district, unless three-fourths 284.23of the municipalities in the district pass a resolution concurring to the additional costs.284.24    (b) The funds must be deposited in the treasury of the district in amounts and at 284.25times as the treasurer of the district requires.284.26    Sec. 10. Minnesota Statutes 2012, section 103B.691, subdivision 2, is amended to read:284.27    Subd. 2. Municipal funding of district. (a) The governing body or board of 284.28supervisors of each municipality in the district shall provide the funds necessary to meet its 284.29proportion of the total cost to be borne by the municipalities as finally certified by the board.284.30    (b) The municipality's funds may be raised by any means within the authority of 284.31the municipality. The municipalities may each levy a tax not to exceed .02418 percent of 284.32taxable estimated market value on the taxable property located in the district to provide 284.33the funds. The levy shall be within all other limitations provided by law.285.1    (c) The funds must be deposited into the treasury of the district in amounts and at 285.2times as the treasurer of the district requires.285.3    Sec. 11. Minnesota Statutes 2012, section 103D.905, subdivision 2, is amended to read:285.4    Subd. 2. Organizational expense fund. (a) An organizational expense fund, 285.5consisting of an ad valorem tax levy, shall not exceed 0.01596 percent of taxable estimated285.6 market value, or $60,000, whichever is less. The money in the fund shall be used for 285.7organizational expenses and preparation of the watershed management plan for projects.285.8    (b) The managers may borrow from the affected counties up to 75 percent of the 285.9anticipated funds to be collected from the organizational expense fund levy and the 285.10counties affected may make the advancements.285.11    (c) The advancement of anticipated funds shall be apportioned among affected 285.12counties in the same ratio as the net tax capacity of the area of the counties within 285.13the watershed district bears to the net tax capacity of the entire watershed district. If a 285.14watershed district is enlarged, an organizational expense fund may be levied against the 285.15area added to the watershed district in the same manner as provided in this subdivision.285.16    (d) Unexpended funds collected for the organizational expense may be transferred to 285.17the administrative fund and used for the purposes of the administrative fund.285.18    Sec. 12. Minnesota Statutes 2012, section 103D.905, subdivision 3, is amended to read:285.19    Subd. 3. General fund. A general fund, consisting of an ad valorem tax levy, may 285.20not exceed 0.048 percent of taxable estimated market value, or $250,000, whichever is 285.21less. The money in the fund shall be used for general administrative expenses and for 285.22the construction or implementation and maintenance of projects of common benefit to 285.23the watershed district. The managers may make an annual levy for the general fund as 285.24provided in section 
         103D.911. In addition to the annual general levy, the managers may 285.25annually levy a tax not to exceed 0.00798 percent of taxable estimated market value 285.26for a period not to exceed 15 consecutive years to pay the cost attributable to the basic 285.27water management features of projects initiated by petition of a political subdivision 285.28within the watershed district or by petition of at least 50 resident owners whose property 285.29is within the watershed district.285.30    Sec. 13. Minnesota Statutes 2012, section 103D.905, subdivision 8, is amended to read:285.31    Subd. 8. Survey and data acquisition fund. (a) A survey and data acquisition fund 285.32is established and used only if other funds are not available to the watershed district to pay 285.33for making necessary surveys and acquiring data.286.1    (b) The survey and data acquisition fund consists of the proceeds of a property tax 286.2that can be levied only once every five years. The levy may not exceed 0.02418 percent of 286.3taxable estimated market value.286.4    (c) The balance of the survey and data acquisition fund may not exceed $50,000.286.5    (d) In a subsequent proceeding for a project where a survey has been made, the 286.6attributable cost of the survey as determined by the managers shall be included as a part of 286.7the cost of the work and the sum shall be repaid to the survey and data acquisition fund.286.8    Sec. 14. Minnesota Statutes 2012, section 117.025, subdivision 7, is amended to read:286.9    Subd. 7. Structurally substandard. "Structurally substandard" means a building:286.10    (1) that was inspected by the appropriate local government and cited for one or more 286.11enforceable housing, maintenance, or building code violations;286.12    (2) in which the cited building code violations involve one or more of the following:286.13    (i) a roof and roof framing element;286.14    (ii) support walls, beams, and headers;286.15    (iii) foundation, footings, and subgrade conditions;286.16    (iv) light and ventilation;286.17    (v) fire protection, including egress;286.18    (vi) internal utilities, including electricity, gas, and water;286.19    (vii) flooring and flooring elements; or286.20    (viii) walls, insulation, and exterior envelope;286.21    (3) in which the cited housing, maintenance, or building code violations have not 286.22been remedied after two notices to cure the noncompliance; and286.23    (4) has uncured housing, maintenance, and building code violations, satisfaction of 286.24which would cost more than 50 percent of the assessor's taxable estimated market value 286.25for the building, excluding land value, as determined under section 
         273.11 for property 286.26taxes payable in the year in which the condemnation is commenced.286.27A local government is authorized to seek from a judge or magistrate an administrative 286.28warrant to gain access to inspect a specific building in a proposed development or 286.29redevelopment area upon showing of probable cause that a specific code violation has 286.30occurred and that the violation has not been cured, and that the owner has denied the local 286.31government access to the property. Items of evidence that may support a conclusion of 286.32probable cause may include recent fire or police inspections, housing inspection, exterior 286.33evidence of deterioration, or other similar reliable evidence of deterioration in the specific 286.34building.287.1    Sec. 15. Minnesota Statutes 2012, section 127A.48, subdivision 1, is amended to read:287.2    Subdivision 1. Computation. The Department of Revenue must annually conduct 287.3an assessment/sales ratio study of the taxable property in each county, city, town, and 287.4school district in accordance with the procedures in subdivisions 2 and 3. Based upon the 287.5results of this assessment/sales ratio study, the Department of Revenue must determine an 287.6aggregate equalized net tax capacity for the various classes of taxable property in each 287.7taxing district, the aggregate of which tax capacity shall be is designated as the adjusted net 287.8tax capacity. The adjusted net tax capacity must be reduced by the captured tax capacity of 287.9tax increment districts under section 469.177, subdivision 2, fiscal disparities contribution 287.10tax capacities under sections 276A.06 and 473F.08, and the tax capacity of transmission 287.11lines required to be subtracted from the local tax base under section 273.425; and increased 287.12by fiscal disparities distribution tax capacities under sections 276A.06 and 473F.08. The 287.13adjusted net tax capacities shall be determined using the net tax capacity percentages in 287.14effect for the assessment year following the assessment year of the study. The Department 287.15of Revenue must make whatever estimates are necessary to account for changes in the 287.16classification system. The Department of Revenue may incur the expense necessary to 287.17make the determinations. The commissioner of revenue may reimburse any county or 287.18governmental official for requested services performed in ascertaining the adjusted net tax 287.19capacity. On or before March 15 annually, the Department of Revenue shall file with the 287.20chair of the Tax Committee of the house of representatives and the chair of the Committee 287.21on Taxes and Tax laws of the senate a report of adjusted net tax capacities for school 287.22districts. On or before June 15 annually, the Department of Revenue shall file its final report 287.23on the adjusted net tax capacities for school districts established by the previous year's 287.24assessments and the current year's net tax capacity percentages with the commissioner of 287.25education and each county auditor for those school districts for which the auditor has the 287.26responsibility for determination of local tax rates. A copy of the report so filed shall be 287.27mailed to the clerk of each school district involved and to the county assessor or supervisor 287.28of assessments of the county or counties in which each school district is located.287.29EFFECTIVE DATE.This section is effective the day following final enactment.287.30    Sec. 16. Minnesota Statutes 2012, section 138.053, is amended to read:287.31138.053 COUNTY HISTORICAL SOCIETY; TAX LEVY; CITIES OR 287.32TOWNS.287.33    The governing body of any home rule charter or statutory city or town may annually 287.34appropriate from its general fund an amount not to exceed 0.02418 percent of taxable288.1 estimated market value, derived from ad valorem taxes on property or other revenues, to 288.2be paid to the historical society of its respective county to be used for the promotion of 288.3historical work and to aid in defraying the expenses of carrying on the historical work in the 288.4county. No city or town may appropriate any funds for the benefit of any historical society 288.5unless the society is affiliated with and approved by the Minnesota Historical Society.288.6    Sec. 17. Minnesota Statutes 2012, section 144F.01, subdivision 4, is amended to read:288.7    Subd. 4. Property tax levy authority. The district's board may levy a tax on the 288.8taxable real and personal property in the district. The ad valorem tax levy may not exceed 288.90.048 percent of the taxable estimated market value of the district or $400,000, whichever 288.10is less. The proceeds of the levy must be used as provided in subdivision 5. The board shall 288.11certify the levy at the times as provided under section 
         275.07. The board shall provide the 288.12county with whatever information is necessary to identify the property that is located within 288.13the district. If the boundaries include a part of a parcel, the entire parcel shall be included 288.14in the district. The county auditors must spread, collect, and distribute the proceeds of the 288.15tax at the same time and in the same manner as provided by law for all other property taxes.288.16    Sec. 18. Minnesota Statutes 2012, section 162.07, subdivision 3, is amended to read:288.17    Subd. 3. Computation for rural counties. An amount equal to a levy of 0.01596 288.18percent on each rural county's total taxable estimated market value for the last preceding 288.19calendar year shall be computed and shall be subtracted from the county's total estimated 288.20construction costs. The result thereof shall be the money needs of the county. For the 288.21purpose of this section, "rural counties" means all counties having a population of less 288.22than 175,000.288.23    Sec. 19. Minnesota Statutes 2012, section 162.07, subdivision 4, is amended to read:288.24    Subd. 4. Computation for urban counties. An amount equal to a levy of 0.00967 288.25percent on each urban county's total taxable estimated market value for the last preceding 288.26calendar year shall be computed and shall be subtracted from the county's total estimated 288.27construction costs. The result thereof shall be the money needs of the county. For 288.28the purpose of this section, "urban counties" means all counties having a population 288.29of 175,000 or more.288.30    Sec. 20. Minnesota Statutes 2012, section 163.04, subdivision 3, is amended to read:288.31    Subd. 3. Bridges within certain cities. When the council of any statutory city or 288.32city of the third or fourth class may determine that it is necessary to build or improve any 289.1bridge or bridges, including approaches thereto, and any dam or retaining works connected 289.2therewith, upon or forming a part of streets or highways either wholly or partly within 289.3its limits, the county board shall appropriate one-half of the money as may be necessary 289.4therefor from the county road and bridge fund, not exceeding during any year one-half 289.5the amount of taxes paid into the county road and bridge fund during the preceding year, 289.6on property within the corporate limits of the city. The appropriation shall be made upon 289.7the petition of the council, which petition shall be filed by the council with the county 289.8board prior to the fixing by the board of the annual county tax levy. The county board 289.9shall determine the plans and specifications, shall let all necessary contracts, shall have 289.10charge of construction, and upon its request, warrants in payment thereof shall be issued 289.11by the county auditor, from time to time, as the construction work proceeds. Any unpaid 289.12balance may be paid or advanced by the city. On petition of the council, the appropriations 289.13of the county board, during not to exceed three successive years, may be made to apply 289.14on the construction of the same items and to repay any money advanced by the city in 289.15the construction thereof. None of the provisions of this section shall be construed to 289.16be mandatory as applied to any city whose estimated market value exceeds $2,100 per 289.17capita of its population.289.18    Sec. 21. Minnesota Statutes 2012, section 163.06, subdivision 6, is amended to read:289.19    Subd. 6. Expenditure in certain counties. In any county having not less than 95 289.20nor more than 105 full and fractional townships, and having a an estimated market value 289.21of not less than $12,000,000 nor more than $21,000,000, exclusive of money and credits,289.22 the county board, by resolution, may expend the funds provided in subdivision 4 in any 289.23organized or unorganized township town or unorganized territory or portion thereof in 289.24such county.289.25    Sec. 22. Minnesota Statutes 2012, section 165.10, subdivision 1, is amended to read:289.26    Subdivision 1. Certain counties may issue and sell. The county board of any 289.27county having no outstanding road and bridge bonds may issue and sell county road bonds 289.28in an amount not exceeding 0.12089 percent of the estimated market value of the taxable 289.29property within the county exclusive of money and credits, for the purpose of constructing, 289.30reconstructing, improving, or maintaining any bridge or bridges on any highway under its 289.31jurisdiction, without submitting the matter to a vote of the electors of the county.289.32    Sec. 23. Minnesota Statutes 2012, section 272.03, is amended by adding a subdivision 289.33to read:290.1    Subd. 14.Estimated market value."Estimated market value" means the assessor's 290.2determination of market value, including the effects of any orders made under section 290.3270.12 or chapter 274, for the parcel. The provisions of section 273.032 apply for certain 290.4uses in determining the total estimated market value for the taxing jurisdiction.290.5    Sec. 24. Minnesota Statutes 2012, section 272.03, is amended by adding a subdivision 290.6to read:290.7    Subd. 15.Taxable market value."Taxable market value" means estimated market 290.8value for the parcel as reduced by market value exclusions, deferments of value, or other 290.9adjustments required by law, that reduce market value before the application of class rates.290.10    Sec. 25. Minnesota Statutes 2012, section 273.032, is amended to read:290.11273.032 MARKET VALUE DEFINITION.290.12    (a) Unless otherwise provided, for the purpose of determining any property tax 290.13levy limitation based on market value or any limit on net debt, the issuance of bonds, 290.14certificates of indebtedness, or capital notes based on market value, any qualification to 290.15receive state aid based on market value, or any state aid amount based on market value, the 290.16terms "market value," "taxable estimated market value," and "market valuation," whether 290.17equalized or unequalized, mean the total taxable estimated market value of taxable property 290.18within the local unit of government before any of the following or similar adjustments for:290.19    (1) the market value exclusions under:290.20    (i) section 273.11, subdivisions 14a and 14c (vacant platted land);290.21    (ii) section 273.11, subdivision 16 (certain improvements to homestead property);290.22    (iii) section 273.11, subdivisions 19 and 20 (certain improvements to business 290.23properties);290.24    (iv) section 273.11, subdivision 21 (homestead property damaged by mold);290.25    (v) section 273.11, subdivision 22 (qualifying lead hazardous reduction projects);290.26    (vi) section 273.13, subdivision 34 (homestead of a disabled veteran or family 290.27caregiver);290.28    (vii) section 273.13, subdivision 35 (homestead market value exclusion); or290.29    (2) the deferment of value under:290.30    (i) the Minnesota Agricultural Property Tax Law, section 273.111;290.31    (ii) the Aggregate Resource Preservation Law, section 273.1115;290.32    (iii) the Minnesota Open Space Property Tax Law, section 273.112;290.33    (iv) the rural preserves property tax program, section 273.114; or290.34    (v) the Metropolitan Agricultural Preserves Act, section 473H.10; or291.1    (3) the adjustments to tax capacity for:291.2    (i) tax increment, financing under sections 469.174 to 469.1794;291.3    (ii) fiscal disparity, disparities under chapter 276A or 473F; or291.4    (iii)  powerline credit, or wind energy values, but after the limited market adjustments 291.5under section 273.11, subdivision 1a, and after the market value exclusions of certain 291.6improvements to homestead property under section 273.11, subdivision 16 under section 291.7273.425.291.8    (b) Estimated market value under paragraph (a) also includes the market value 291.9of tax-exempt property if the applicable law specifically provides that the limitation, 291.10qualification, or aid calculation includes tax-exempt property.291.11    (c) Unless otherwise provided, "market value," "taxable estimated market value," 291.12and "market valuation" for purposes of this paragraph property tax levy limitations and 291.13calculation of state aid, refer to the taxable estimated market value for the previous 291.14assessment year and for purposes of limits on net debt, the issuance of bonds, certificates of 291.15indebtedness, or capital notes refer to the estimated market value as last finally equalized.291.16    For the purpose of determining any net debt limit based on market value, or any limit 291.17on the issuance of bonds, certificates of indebtedness, or capital notes based on market 291.18value, the terms "market value," "taxable market value," and "market valuation," whether 291.19equalized or unequalized, mean the total taxable market value of property within the local 291.20unit of government before any adjustments for tax increment, fiscal disparity, powerline 291.21credit, or wind energy values, but after the limited market value adjustments under section 291.22273.11, subdivision 1a, and after the market value exclusions of certain improvements to 291.23homestead property under section 273.11, subdivision 16. Unless otherwise provided, 291.24"market value," "taxable market value," and "market valuation" for purposes of this 291.25paragraph, mean the taxable market value as last finally equalized.291.26    (d) For purposes of a provision of a home rule charter or of any special law that is not 291.27codified in the statutes and that imposes a levy limitation based on market value or any limit 291.28on debt, the issuance of bonds, certificates of indebtedness, or capital notes based on market 291.29value, the terms "market value," "taxable market value," and "market valuation," whether 291.30equalized or unequalized, mean "estimated market value" as defined in paragraph (a).291.31    Sec. 26. Minnesota Statutes 2012, section 273.11, subdivision 1, is amended to read:291.32    Subdivision 1. Generally. Except as provided in this section or section 
         273.17, 291.33subdivision 1
         , all property shall be valued at its market value. The market value as 291.34determined pursuant to this section shall be stated such that any amount under $100 is 291.35rounded up to $100 and any amount exceeding $100 shall be rounded to the nearest $100. 292.1In estimating and determining such value, the assessor shall not adopt a lower or different 292.2standard of value because the same is to serve as a basis of taxation, nor shall the assessor 292.3adopt as a criterion of value the price for which such property would sell at a forced sale, 292.4or in the aggregate with all the property in the town or district; but the assessor shall value 292.5each article or description of property by itself, and at such sum or price as the assessor 292.6believes the same to be fairly worth in money. The assessor shall take into account the 292.7effect on the market value of property of environmental factors in the vicinity of the 292.8property. In assessing any tract or lot of real property, the value of the land, exclusive of 292.9structures and improvements, shall be determined, and also the value of all structures and 292.10improvements thereon, and the aggregate value of the property, including all structures 292.11and improvements, excluding the value of crops growing upon cultivated land. In valuing 292.12real property upon which there is a mine or quarry, it shall be valued at such price as such 292.13property, including the mine or quarry, would sell for at a fair, voluntary sale, for cash, 292.14if the material being mined or quarried is not subject to taxation under section 
         298.015292.15and the mine or quarry is not exempt from the general property tax under section 
         298.25. 292.16In valuing real property which is vacant, platted property shall be assessed as provided 292.17in subdivision 14 subdivisions 14a and 14c. All property, or the use thereof, which is 292.18taxable under section 
         272.01, subdivision 2, or 
         273.19, shall be valued at the market 292.19value of such property and not at the value of a leasehold estate in such property, or at 292.20some lesser value than its market value.292.21    Sec. 27. Minnesota Statutes 2012, section 273.124, subdivision 3a, is amended to read:292.22    Subd. 3a. Manufactured home park cooperative. (a) When a manufactured home 292.23park is owned by a corporation or association organized under chapter 308A or 308B, 292.24and each person who owns a share or shares in the corporation or association is entitled 292.25to occupy a lot within the park, the corporation or association may claim homestead 292.26treatment for the park. Each lot must be designated by legal description or number, and 292.27each lot is limited to not more than one-half acre of land.292.28    (b) The manufactured home park shall be entitled to homestead treatment if all 292.29of the following criteria are met:292.30    (1) the occupant or the cooperative corporation or association is paying the ad 292.31valorem property taxes and any special assessments levied against the land and structure 292.32either directly, or indirectly through dues to the corporation or association; and292.33    (2) the corporation or association organized under chapter 308A or 308B is wholly 292.34owned by persons having a right to occupy a lot owned by the corporation or association.293.1    (c) A charitable corporation, organized under the laws of Minnesota with no 293.2outstanding stock, and granted a ruling by the Internal Revenue Service for 501(c)(3) 293.3tax-exempt status, qualifies for homestead treatment with respect to a manufactured home 293.4park if its members hold residential participation warrants entitling them to occupy a lot 293.5in the manufactured home park.293.6    (d) "Homestead treatment" under this subdivision means the class rate provided for 293.7class 4c property classified under section 
         273.13, subdivision 25, paragraph (d), clause (5), 293.8item (ii). The homestead market value credit exclusion under section 
         273.1384 273.13, 293.9subdivision 35, does not apply and the property taxes assessed against the park shall not 293.10be included in the determination of taxes payable for rent paid under section 
         290A.03.293.11EFFECTIVE DATE.This section is effective for taxes payable in 2013 and 293.12thereafter.293.13    Sec. 28. Minnesota Statutes 2012, section 273.124, subdivision 13, is amended to read:293.14    Subd. 13. Homestead application. (a) A person who meets the homestead 293.15requirements under subdivision 1 must file a homestead application with the county 293.16assessor to initially obtain homestead classification.293.17    (b) The format and contents of a uniform homestead application shall be prescribed 293.18by the commissioner of revenue. The application must clearly inform the taxpayer that 293.19this application must be signed by all owners who occupy the property or by the qualifying 293.20relative and returned to the county assessor in order for the property to receive homestead 293.21treatment.293.22    (c) Every property owner applying for homestead classification must furnish to the 293.23county assessor the Social Security number of each occupant who is listed as an owner 293.24of the property on the deed of record, the name and address of each owner who does not 293.25occupy the property, and the name and Social Security number of each owner's spouse who 293.26occupies the property. The application must be signed by each owner who occupies the 293.27property and by each owner's spouse who occupies the property, or, in the case of property 293.28that qualifies as a homestead under subdivision 1, paragraph (c), by the qualifying relative.293.29    If a property owner occupies a homestead, the property owner's spouse may not 293.30claim another property as a homestead unless the property owner and the property owner's 293.31spouse file with the assessor an affidavit or other proof required by the assessor stating that 293.32the property qualifies as a homestead under subdivision 1, paragraph (e).293.33    Owners or spouses occupying residences owned by their spouses and previously 293.34occupied with the other spouse, either of whom fail to include the other spouse's name 293.35and Social Security number on the homestead application or provide the affidavits or 294.1other proof requested, will be deemed to have elected to receive only partial homestead 294.2treatment of their residence. The remainder of the residence will be classified as 294.3nonhomestead residential. When an owner or spouse's name and Social Security number 294.4appear on homestead applications for two separate residences and only one application is 294.5signed, the owner or spouse will be deemed to have elected to homestead the residence for 294.6which the application was signed.294.7    The Social Security numbers, state or federal tax returns or tax return information, 294.8including the federal income tax schedule F required by this section, or affidavits or other 294.9proofs of the property owners and spouses submitted under this or another section to 294.10support a claim for a property tax homestead classification are private data on individuals as 294.11defined by section 
         13.02, subdivision 12, but, notwithstanding that section, the private data 294.12may be disclosed to the commissioner of revenue, or, for purposes of proceeding under the 294.13Revenue Recapture Act to recover personal property taxes owing, to the county treasurer.294.14    (d) If residential real estate is occupied and used for purposes of a homestead by a 294.15relative of the owner and qualifies for a homestead under subdivision 1, paragraph (c), in 294.16order for the property to receive homestead status, a homestead application must be filed 294.17with the assessor. The Social Security number of each relative and spouse of a relative 294.18occupying the property shall be required on the homestead application filed under this 294.19subdivision. If a different relative of the owner subsequently occupies the property, the 294.20owner of the property must notify the assessor within 30 days of the change in occupancy. 294.21The Social Security number of a relative or relative's spouse occupying the property 294.22is private data on individuals as defined by section 
         13.02, subdivision 12, but may be 294.23disclosed to the commissioner of revenue, or, for the purposes of proceeding under the 294.24Revenue Recapture Act to recover personal property taxes owing, to the county treasurer.294.25    (e) The homestead application shall also notify the property owners that the 294.26application filed under this section will not be mailed annually and that if the property 294.27is granted homestead status for any assessment year, that same property shall remain 294.28classified as homestead until the property is sold or transferred to another person, or 294.29the owners, the spouse of the owner, or the relatives no longer use the property as their 294.30homestead. Upon the sale or transfer of the homestead property, a certificate of value must 294.31be timely filed with the county auditor as provided under section 
         272.115. Failure to 294.32notify the assessor within 30 days that the property has been sold, transferred, or that the 294.33owner, the spouse of the owner, or the relative is no longer occupying the property as a 294.34homestead, shall result in the penalty provided under this subdivision and the property 294.35will lose its current homestead status.295.1    (f) If the homestead application is not returned within 30 days, the county will send a 295.2second application to the present owners of record. The notice of proposed property taxes 295.3prepared under section 
         275.065, subdivision 3, shall reflect the property's classification. If 295.4a homestead application has not been filed with the county by December 15, the assessor 295.5shall classify the property as nonhomestead for the current assessment year for taxes 295.6payable in the following year, provided that the owner may be entitled to receive the 295.7homestead classification by proper application under section 
         375.192.295.8    (g) At the request of the commissioner, each county must give the commissioner a 295.9list that includes the name and Social Security number of each occupant of homestead 295.10property who is the property owner, property owner's spouse, qualifying relative of a 295.11property owner, or a spouse of a qualifying relative. The commissioner shall use the 295.12information provided on the lists as appropriate under the law, including for the detection 295.13of improper claims by owners, or relatives of owners, under chapter 290A.295.14    (h) If the commissioner finds that a property owner may be claiming a fraudulent 295.15homestead, the commissioner shall notify the appropriate counties. Within 90 days of 295.16the notification, the county assessor shall investigate to determine if the homestead 295.17classification was properly claimed. If the property owner does not qualify, the county 295.18assessor shall notify the county auditor who will determine the amount of homestead 295.19benefits that had been improperly allowed. For the purpose of this section, "homestead 295.20benefits" means the tax reduction resulting from the classification as a homestead and the 295.21homestead market value exclusion under section 
         273.13, the taconite homestead credit 295.22under section 
         273.135, the residential homestead and agricultural homestead credits credit295.23 under section 
         273.1384, and the supplemental homestead credit under section 
         273.1391.295.24    The county auditor shall send a notice to the person who owned the affected property 295.25at the time the homestead application related to the improper homestead was filed, 295.26demanding reimbursement of the homestead benefits plus a penalty equal to 100 percent 295.27of the homestead benefits. The person notified may appeal the county's determination 295.28by serving copies of a petition for review with county officials as provided in section 295.29278.01
          and filing proof of service as provided in section 
         278.01 with the Minnesota Tax 295.30Court within 60 days of the date of the notice from the county. Procedurally, the appeal 295.31is governed by the provisions in chapter 271 which apply to the appeal of a property tax 295.32assessment or levy, but without requiring any prepayment of the amount in controversy. If 295.33the amount of homestead benefits and penalty is not paid within 60 days, and if no appeal 295.34has been filed, the county auditor shall certify the amount of taxes and penalty to the county 295.35treasurer. The county treasurer will add interest to the unpaid homestead benefits and 295.36penalty amounts at the rate provided in section 
         279.03 for real property taxes becoming 296.1delinquent in the calendar year during which the amount remains unpaid. Interest may be 296.2assessed for the period beginning 60 days after demand for payment was made.296.3    If the person notified is the current owner of the property, the treasurer may add the 296.4total amount of homestead benefits, penalty, interest, and costs to the ad valorem taxes 296.5otherwise payable on the property by including the amounts on the property tax statements 296.6under section 
         276.04, subdivision 3. The amounts added under this paragraph to the ad 296.7valorem taxes shall include interest accrued through December 31 of the year preceding 296.8the taxes payable year for which the amounts are first added. These amounts, when added 296.9to the property tax statement, become subject to all the laws for the enforcement of real or 296.10personal property taxes for that year, and for any subsequent year.296.11    If the person notified is not the current owner of the property, the treasurer may 296.12collect the amounts due under the Revenue Recapture Act in chapter 270A, or use any of 296.13the powers granted in sections 
         277.20 and 
         277.21 without exclusion, to enforce payment 296.14of the homestead benefits, penalty, interest, and costs, as if those amounts were delinquent 296.15tax obligations of the person who owned the property at the time the application related to 296.16the improperly allowed homestead was filed. The treasurer may relieve a prior owner of 296.17personal liability for the homestead benefits, penalty, interest, and costs, and instead extend 296.18those amounts on the tax lists against the property as provided in this paragraph to the extent 296.19that the current owner agrees in writing. On all demands, billings, property tax statements, 296.20and related correspondence, the county must list and state separately the amounts of 296.21homestead benefits, penalty, interest and costs being demanded, billed or assessed.296.22    (i) Any amount of homestead benefits recovered by the county from the property 296.23owner shall be distributed to the county, city or town, and school district where the 296.24property is located in the same proportion that each taxing district's levy was to the total 296.25of the three taxing districts' levy for the current year. Any amount recovered attributable 296.26to taconite homestead credit shall be transmitted to the St. Louis County auditor to be 296.27deposited in the taconite property tax relief account. Any amount recovered that is 296.28attributable to supplemental homestead credit is to be transmitted to the commissioner of 296.29revenue for deposit in the general fund of the state treasury. The total amount of penalty 296.30collected must be deposited in the county general fund.296.31    (j) If a property owner has applied for more than one homestead and the county 296.32assessors cannot determine which property should be classified as homestead, the county 296.33assessors will refer the information to the commissioner. The commissioner shall make 296.34the determination and notify the counties within 60 days.296.35    (k) In addition to lists of homestead properties, the commissioner may ask the 296.36counties to furnish lists of all properties and the record owners. The Social Security 297.1numbers and federal identification numbers that are maintained by a county or city 297.2assessor for property tax administration purposes, and that may appear on the lists retain 297.3their classification as private or nonpublic data; but may be viewed, accessed, and used by 297.4the county auditor or treasurer of the same county for the limited purpose of assisting the 297.5commissioner in the preparation of microdata samples under section 
         270C.12.297.6    (l) On or before April 30 each year beginning in 2007, each county must provide the 297.7commissioner with the following data for each parcel of homestead property by electronic 297.8means as defined in section 
         289A.02, subdivision 8:297.9    (i) the property identification number assigned to the parcel for purposes of taxes 297.10payable in the current year;297.11    (ii) the name and Social Security number of each occupant of homestead property 297.12who is the property owner, property owner's spouse, qualifying relative of a property 297.13owner, or spouse of a qualifying relative;297.14    (iii) the classification of the property under section 
         273.13 for taxes payable in the 297.15current year and in the prior year;297.16    (iv) an indication of whether the property was classified as a homestead for taxes 297.17payable in the current year because of occupancy by a relative of the owner or by a 297.18spouse of a relative;297.19    (v) the property taxes payable as defined in section 
         290A.03, subdivision 13, for the 297.20current year and the prior year;297.21    (vi) the market value of improvements to the property first assessed for tax purposes 297.22for taxes payable in the current year;297.23    (vii) the assessor's estimated market value assigned to the property for taxes payable 297.24in the current year and the prior year;297.25    (viii) the taxable market value assigned to the property for taxes payable in the 297.26current year and the prior year;297.27    (ix) whether there are delinquent property taxes owing on the homestead;297.28    (x) the unique taxing district in which the property is located; and297.29    (xi) such other information as the commissioner decides is necessary.297.30    The commissioner shall use the information provided on the lists as appropriate 297.31under the law, including for the detection of improper claims by owners, or relatives 297.32of owners, under chapter 290A.297.33EFFECTIVE DATE.This section is effective for taxes payable in 2013 and 297.34thereafter.297.35    Sec. 29. Minnesota Statutes 2012, section 273.13, subdivision 21b, is amended to read:298.1    Subd. 21b. Net tax capacity.(a) Gross tax capacity means the product of the 298.2appropriate gross class rates in this section and market values.298.3    (b) Net tax capacity means the product of the appropriate net class rates in this 298.4section and taxable market values.298.5EFFECTIVE DATE.This section is effective the day following final enactment.298.6    Sec. 30. Minnesota Statutes 2012, section 273.1398, subdivision 3, is amended to read:298.7    Subd. 3. Disparity reduction aid.  The amount of disparity aid certified for each 298.8taxing district within each unique taxing jurisdiction for taxes payable in the prior year 298.9shall be multiplied by the ratio of (1) the jurisdiction's tax capacity using the class rates for 298.10taxes payable in the year for which aid is being computed, to (2) its tax capacity using 298.11the class rates for taxes payable in the year prior to that for which aid is being computed, 298.12both based upon taxable market values for taxes payable in the year prior to that for which 298.13aid is being computed. If the commissioner determines that insufficient information is 298.14available to reasonably and timely calculate the numerator in this ratio for the first taxes 298.15payable year that a class rate change or new class rate is effective, the commissioner shall 298.16omit the effects of that class rate change or new class rate when calculating this ratio for 298.17aid payable in that taxes payable year. For aid payable in the year following a year for 298.18which such omission was made, the commissioner shall use in the denominator for the 298.19class that was changed or created, the tax capacity for taxes payable two years prior to that 298.20in which the aid is payable, based on taxable market values for taxes payable in the year 298.21prior to that for which aid is being computed.298.22    Sec. 31. Minnesota Statutes 2012, section 273.1398, subdivision 4, is amended to read:298.23    Subd. 4. Disparity reduction credit. (a) Beginning with taxes payable in 1989, 298.24class 4a and class 3a property qualifies for a disparity reduction credit if: (1) the property 298.25is located in a border city that has an enterprise zone, as defined in section 
         469.166; (2) 298.26the property is located in a city with a population greater than 2,500 and less than 35,000 298.27according to the 1980 decennial census; (3) the city is adjacent to a city in another state or 298.28immediately adjacent to a city adjacent to a city in another state; and (4) the adjacent city 298.29in the other state has a population of greater than 5,000 and less than 75,000 according to 298.30the 1980 decennial census.298.31    (b) The credit is an amount sufficient to reduce (i) the taxes levied on class 4a 298.32property to 2.3 percent of the property's taxable market value and (ii) the tax on class 3a 298.33property to 2.3 percent of taxable market value.299.1    (c) The county auditor shall annually certify the costs of the credits to the 299.2Department of Revenue. The department shall reimburse local governments for the 299.3property taxes forgone as the result of the credits in proportion to their total levies.299.4    Sec. 32. Minnesota Statutes 2012, section 275.011, subdivision 1, is amended to read:299.5    Subdivision 1. Determination of levy limit. The property tax levied for any 299.6purpose under a special law that is not codified in Minnesota Statutes or a city charter 299.7provision and that is subject to a mill rate limitation imposed by the special law or city 299.8charter provision, excluding levies subject to mill rate limitations that use adjusted 299.9assessed values determined by the commissioner of revenue under section 
         124.2131, must 299.10not exceed the following amount for the years specified:299.11    (a) for taxes payable in 1988, the product of the applicable mill rate limitation 299.12imposed by special law or city charter provision multiplied by the total assessed valuation 299.13of all taxable property subject to the tax as adjusted by the provisions of Minnesota 299.14Statutes 1986, sections 
         272.64; 
         273.13, subdivision 7a; and 
         275.49;299.15    (b) for taxes payable in 1989, the product of (1) the property tax levy limitation for 299.16the taxes payable year 1988 determined under clause (a) multiplied by (2) an index for 299.17market valuation changes equal to the assessment year 1988 total market valuation of all 299.18taxable property subject to the tax divided by the assessment year 1987 total market 299.19valuation of all taxable property subject to the tax; and299.20    (c) for taxes payable in 1990 and subsequent years, the product of (1) the property 299.21tax levy limitation for the previous year determined pursuant to this subdivision multiplied 299.22by (2) an index for market valuation changes equal to the total market valuation of all 299.23taxable property subject to the tax for the current assessment year divided by the total 299.24market valuation of all taxable property subject to the tax for the previous assessment year.299.25    For the purpose of determining the property tax levy limitation for the taxes payable 299.26year 1988 2014 and subsequent years under this subdivision, "total market valuation" 299.27means the total estimated market valuation value of all taxable property subject to the 299.28tax without valuation adjustments for fiscal disparities (chapters 276A and 473F), tax 299.29increment financing (sections 469.174 to 469.179), or powerline credit (section 273.425)299.30 as provided under section 273.032.299.31    Sec. 33. Minnesota Statutes 2012, section 275.077, subdivision 2, is amended to read:299.32    Subd. 2. Correction of levy amount. The difference between the correct levy and 299.33the erroneous levy shall be added to the township levy for the subsequent levy year; 299.34provided that if the amount of the difference exceeds 0.12089 percent of taxable estimated300.1 market value, the excess shall be added to the township levy for the second and later 300.2subsequent levy years, not to exceed an additional levy of 0.12089 percent of taxable300.3 estimated market value in any year, until the full amount of the difference has been levied. 300.4The funds collected from the corrected levies shall be used to reimburse the county for the 300.5payment required by subdivision 1.300.6    Sec. 34. Minnesota Statutes 2012, section 275.71, subdivision 4, is amended to read:300.7    Subd. 4. Adjusted levy limit base.  For taxes levied in 2008 through 2010, the 300.8adjusted levy limit base is equal to the levy limit base computed under subdivision 2 300.9or section 
         275.72, multiplied by:300.10    (1) one plus the percentage growth in the implicit price deflator, but the percentage 300.11shall not be less than zero or exceed 3.9 percent;300.12    (2) one plus a percentage equal to 50 percent of the percentage increase in the number 300.13of households, if any, for the most recent 12-month period for which data is available; and300.14    (3) one plus a percentage equal to 50 percent of the percentage increase in the 300.15taxable estimated market value of the jurisdiction due to new construction of class 3 300.16property, as defined in section 
         273.13, subdivision 4, except for state-assessed utility and 300.17railroad property, for the most recent year for which data is available.300.18    Sec. 35. Minnesota Statutes 2012, section 276.04, subdivision 2, is amended to read:300.19    Subd. 2. Contents of tax statements. (a) The treasurer shall provide for the printing 300.20of the tax statements. The commissioner of revenue shall prescribe the form of the property 300.21tax statement and its contents. The tax statement must not state or imply that property tax 300.22credits are paid by the state of Minnesota. The statement must contain a tabulated statement 300.23of the dollar amount due to each taxing authority and the amount of the state tax from the 300.24parcel of real property for which a particular tax statement is prepared. The dollar amounts 300.25attributable to the county, the state tax, the voter approved school tax, the other local school 300.26tax, the township or municipality, and the total of the metropolitan special taxing districts 300.27as defined in section 
         275.065, subdivision 3, paragraph (i), must be separately stated. 300.28The amounts due all other special taxing districts, if any, may be aggregated except that 300.29any levies made by the regional rail authorities in the county of Anoka, Carver, Dakota, 300.30Hennepin, Ramsey, Scott, or Washington under chapter 398A shall be listed on a separate 300.31line directly under the appropriate county's levy. If the county levy under this paragraph 300.32includes an amount for a lake improvement district as defined under sections 
         103B.501300.33to 
         103B.581, the amount attributable for that purpose must be separately stated from the 300.34remaining county levy amount. In the case of Ramsey County, if the county levy under this 301.1paragraph includes an amount for public library service under section 
         134.07, the amount 301.2attributable for that purpose may be separated from the remaining county levy amount. 301.3The amount of the tax on homesteads qualifying under the senior citizens' property tax 301.4deferral program under chapter 290B is the total amount of property tax before subtraction 301.5of the deferred property tax amount. The amount of the tax on contamination value 301.6imposed under sections 
         270.91 to 
         270.98, if any, must also be separately stated. The dollar 301.7amounts, including the dollar amount of any special assessments, may be rounded to the 301.8nearest even whole dollar. For purposes of this section whole odd-numbered dollars may 301.9be adjusted to the next higher even-numbered dollar. The amount of market value excluded 301.10under section 
         273.11, subdivision 16, if any, must also be listed on the tax statement.301.11    (b) The property tax statements for manufactured homes and sectional structures 301.12taxed as personal property shall contain the same information that is required on the 301.13tax statements for real property.301.14    (c) Real and personal property tax statements must contain the following information 301.15in the order given in this paragraph. The information must contain the current year tax 301.16information in the right column with the corresponding information for the previous year 301.17in a column on the left:301.18    (1) the property's estimated market value under section 
         273.11, subdivision 1;301.19    (2) the property's homestead market value exclusion under section 
         273.13, 301.20subdivision 35;301.21    (3) the property's taxable market value after reductions under sections 273.11, 301.22subdivisions 1a and 16, and 273.13, subdivision 35 section 272.03, subdivision 15;301.23    (4) the property's gross tax, before credits;301.24    (5) for homestead agricultural properties, the credit under section 
         273.1384;301.25    (6) any credits received under sections 
         273.119; 
         273.1234 or 
         273.1235; 
         273.135; 301.26273.1391
         ; 
         273.1398, subdivision 4; 
         469.171; and 
         473H.10, except that the amount of 301.27credit received under section 
         273.135 must be separately stated and identified as "taconite 301.28tax relief"; and301.29    (7) the net tax payable in the manner required in paragraph (a).301.30    (d) If the county uses envelopes for mailing property tax statements and if the county 301.31agrees, a taxing district may include a notice with the property tax statement notifying 301.32taxpayers when the taxing district will begin its budget deliberations for the current 301.33year, and encouraging taxpayers to attend the hearings. If the county allows notices to 301.34be included in the envelope containing the property tax statement, and if more than 301.35one taxing district relative to a given property decides to include a notice with the tax 302.1statement, the county treasurer or auditor must coordinate the process and may combine 302.2the information on a single announcement.302.3    Sec. 36. Minnesota Statutes 2012, section 276A.01, subdivision 10, is amended to read:302.4    Subd. 10. Adjusted market value. "Adjusted market value" of real and personal 302.5property within a municipality means the assessor's estimated taxable market value, 302.6as defined in section 272.03, of all real and personal property, including the value of 302.7manufactured housing, within the municipality. For purposes of sections 276A.01 to 302.8276A.09, the commissioner of revenue shall annually make determinations and reports 302.9with respect to each municipality which are comparable to those it makes for school 302.10districts, adjusted for sales ratios in a manner similar to the adjustments made to city and 302.11town net tax capacities under section 
         127A.48, subdivisions 1 to 6, in the same manner 302.12and at the same times prescribed by the subdivision. The commissioner of revenue shall 302.13annually determine, for each municipality, information comparable to that required by 302.14section 475.53, subdivision 4, for school districts, as soon as practicable after it becomes 302.15available. The commissioner of revenue shall then compute the equalized market value of 302.16property within each municipality.302.17EFFECTIVE DATE.This section is effective the day following final enactment.302.18    Sec. 37. Minnesota Statutes 2012, section 276A.01, subdivision 12, is amended to read:302.19    Subd. 12. Fiscal capacity. "Fiscal capacity" of a municipality means its valuation302.20 adjusted market value, determined as of January 2 of any year, divided by its population, 302.21determined as of a date in the same year.302.22    Sec. 38. Minnesota Statutes 2012, section 276A.01, subdivision 13, is amended to read:302.23    Subd. 13. Average fiscal capacity. "Average fiscal capacity" of municipalities 302.24means the sum of the valuations adjusted market values of all municipalities, determined 302.25as of January 2 of any year, divided by the sum of their populations, determined as of 302.26a date in the same year.302.27    Sec. 39. Minnesota Statutes 2012, section 276A.01, subdivision 15, is amended to read:302.28    Subd. 15. Net tax capacity. "Net tax capacity" means the taxable market value of 302.29real and personal property multiplied by its net tax capacity rates in section 
         273.13.302.30    Sec. 40. Minnesota Statutes 2012, section 276A.06, subdivision 10, is amended to read:303.1    Subd. 10. Adjustment of values for other computations. For the purpose of 303.2computing the amount or rate of any salary, aid, tax, or debt authorized, required, or 303.3limited by any provision of any law or charter, where the authorization, requirement, or 303.4limitation is related to any value or valuation of taxable property within any governmental 303.5unit, the value or net tax capacity fiscal capacity under section 276A.01, subdivision 12, a 303.6municipality's taxable market value must be adjusted to reflect the adjustments reductions303.7 to net tax capacity effected by subdivision 2, clause (a), provided that: (1) in determining 303.8the taxable market value of commercial-industrial property or any class thereof within 303.9a governmental unit for any purpose other than section 276A.05 municipality, (a) the 303.10reduction required by this subdivision is that amount which bears the same proportion to 303.11the amount subtracted from the governmental unit's municipality's net tax capacity pursuant 303.12to subdivision 2, clause (a), as the taxable market value of commercial-industrial property, 303.13or such class thereof, located within the governmental unit municipality bears to the net 303.14tax capacity of commercial-industrial property, or such class thereof, located within the 303.15governmental unit, and (b) the increase required by this subdivision is that amount which 303.16bears the same proportion to the amount added to the governmental unit's net tax capacity 303.17pursuant to subdivision 2, clause (b), as the market value of commercial-industrial property, 303.18or such class thereof, located within the governmental unit bears to the net tax capacity of 303.19commercial-industrial property, or such class thereof, located within the governmental unit; 303.20and (2) in determining the market value of real property within a municipality for purposes 303.21of section 276A.05, the adjustment prescribed by clause (1)(a) must be made and that 303.22prescribed by clause (1)(b) must not be made municipality. No adjustment shall be made 303.23to taxable market value for the increase in net tax capacity under subdivision 2, clause (b).303.24    Sec. 41. Minnesota Statutes 2012, section 287.08, is amended to read:303.25287.08 TAX, HOW PAYABLE; RECEIPTS.303.26    (a) The tax imposed by sections 
         287.01 to 
         287.12 must be paid to the treasurer of 303.27any county in this state in which the real property or some part is located at or before 303.28the time of filing the mortgage for record. The treasurer shall endorse receipt on the 303.29mortgage and the receipt is conclusive proof that the tax has been paid in the amount 303.30stated and authorizes any county recorder or registrar of titles to record the mortgage. Its 303.31form, in substance, shall be "registration tax hereon of ..................... dollars paid." If the 303.32mortgage is exempt from taxation the endorsement shall, in substance, be "exempt from 303.33registration tax." In either case the receipt must be signed by the treasurer. In case the 303.34treasurer is unable to determine whether a claim of exemption should be allowed, the tax 303.35must be paid as in the case of a taxable mortgage. For documents submitted electronically, 304.1the endorsements and tax amount shall be affixed electronically and no signature by the 304.2treasurer will be required. The actual payment method must be arranged in advance 304.3between the submitter and the receiving county.304.4    (b) The county treasurer may refund in whole or in part any mortgage registry tax 304.5overpayment if a written application by the taxpayer is submitted to the county treasurer 304.6within 3-1/2 years from the date of the overpayment. If the county has not issued a denial 304.7of the application, the taxpayer may bring an action in Tax Court in the county in which 304.8the tax was paid at any time after the expiration of six months from the time that the 304.9application was submitted. A denial of refund may be appealed within 60 days from 304.10the date of the denial by bringing an action in Tax Court in the county in which the tax 304.11was paid. The action is commenced by the serving of a petition for relief on the county 304.12treasurer, and by filing a copy with the court. The county attorney shall defend the action. 304.13The county treasurer shall notify the treasurer of each county that has or would receive a 304.14portion of the tax as paid.304.15    (c) If the county treasurer determines a refund should be paid, or if a refund is 304.16ordered by the court, the county treasurer of each county that actually received a portion 304.17of the tax shall immediately pay a proportionate share of three percent of the refund 304.18using any available county funds. The county treasurer of each county that received, or 304.19would have received, a portion of the tax shall also pay their county's proportionate share 304.20of the remaining 97 percent of the court-ordered refund on or before the 20th day of the 304.21following month using solely the mortgage registry tax funds that would be paid to the 304.22commissioner of revenue on that date under section 
         287.12. If the funds on hand under 304.23this procedure are insufficient to fully fund 97 percent of the court-ordered refund, the 304.24county treasurer of the county in which the action was brought shall file a claim with the 304.25commissioner of revenue under section 
         16A.48 for the remaining portion of 97 percent of 304.26the refund, and shall pay over the remaining portion upon receipt of a warrant from the 304.27state issued pursuant to the claim.304.28    (d) When any mortgage covers real property located in more than one county in this 304.29state the total tax must be paid to the treasurer of the county where the mortgage is first 304.30presented for recording, and the payment must be receipted as provided in paragraph 304.31(a). If the principal debt or obligation secured by such a multiple county mortgage 304.32exceeds $10,000,000, the nonstate portion of the tax must be divided and paid over by 304.33the county treasurer receiving it, on or before the 20th day of each month after receipt, 304.34to the county or counties entitled in the ratio that the estimated market value of the real 304.35property covered by the mortgage in each county bears to the estimated market value of 304.36all the real property in this state described in the mortgage. In making the division and 305.1payment the county treasurer shall send a statement giving the description of the real 305.2property described in the mortgage and the estimated market value of the part located in 305.3each county. For this purpose, the treasurer of any county may require the treasurer of 305.4any other county to certify to the former the estimated market valuation value of any tract 305.5of real property in any mortgage.305.6    (e) The mortgagor must pay the tax imposed by sections 
         287.01 to 
         287.12. The 305.7mortgagee may undertake to collect and remit the tax on behalf of the mortgagor. If the 305.8mortgagee collects money from the mortgagor to remit the tax on behalf of the mortgagor, 305.9the mortgagee has a fiduciary duty to remit the tax on behalf of the mortgagor as to the 305.10amount of the tax collected for that purpose and the mortgagor is relieved of any further 305.11obligation to pay the tax as to the amount collected by the mortgagee for this purpose.305.12    Sec. 42. Minnesota Statutes 2012, section 287.23, subdivision 1, is amended to read:305.13    Subdivision 1. Real property outside county. If any taxable deed or instrument 305.14describes any real property located in more than one county in this state, the total tax must 305.15be paid to the treasurer of the county where the document is first presented for recording, 305.16and the payment must be receipted as provided in section 
         287.08. If the net consideration 305.17exceeds $700,000, the nonstate portion of the tax must be divided and paid over by the 305.18county treasurer receiving it, on or before the 20th day of each month after receipt, to 305.19the county or counties entitled in the ratio which the estimated market value of the real 305.20property covered by the document in each county bears to the estimated market value of 305.21all the real property in this state described in the document. In making the division and 305.22payment the county treasurer shall send a statement to the other involved counties giving 305.23the description of the real property described in the document and the estimated market 305.24value of the part located in each county. The treasurer of any county may require the 305.25treasurer of any other county to certify to the former the estimated market valuation value305.26 of any parcel of real property for this purpose.305.27    Sec. 43. Minnesota Statutes 2012, section 353G.08, subdivision 2, is amended to read:305.28    Subd. 2. Cash flow funding requirement. If the executive director determines that 305.29an account in the voluntary statewide lump-sum volunteer firefighter retirement plan has 305.30insufficient assets to meet the service pensions determined payable from the account, 305.31the executive director shall certify the amount of the potential service pension shortfall 305.32to the municipality or municipalities and the municipality or municipalities shall make 305.33an additional employer contribution to the account within ten days of the certification. 305.34If more than one municipality is associated with the account, unless the municipalities 306.1agree to a different allocation, the municipalities shall allocate the additional employer 306.2contribution one-half in proportion to the population of each municipality and one-half in 306.3proportion to the estimated market value of the property of each municipality.306.4    Sec. 44. Minnesota Statutes 2012, section 365.025, subdivision 4, is amended to read:306.5    Subd. 4. Major purchases: notice, petition, election. Before buying anything 306.6under subdivision 2 that costs more than 0.24177 percent of the estimated market value of 306.7the town, the town must follow this subdivision.306.8    The town must publish in its official newspaper the board's resolution to pay for the 306.9property over time. Then a petition for an election on the contract may be filed with the 306.10clerk. The petition must be filed within ten days after the resolution is published. To require 306.11the election the petition must be signed by a number of voters equal to ten percent of the 306.12voters at the last regular town election. The contract then must be approved by a majority of 306.13those voting on the question. The question may be voted on at a regular or special election.306.14    Sec. 45. Minnesota Statutes 2012, section 366.095, subdivision 1, is amended to read:306.15    Subdivision 1. Certificates of indebtedness. The town board may issue certificates 306.16of indebtedness within the debt limits for a town purpose otherwise authorized by law. 306.17The certificates shall be payable in not more than ten years and be issued on the terms and 306.18in the manner as the board may determine. If the amount of the certificates to be issued 306.19exceeds 0.25 percent of the estimated market value of the town, they shall not be issued 306.20for at least ten days after publication in a newspaper of general circulation in the town of 306.21the board's resolution determining to issue them. If within that time, a petition asking for 306.22an election on the proposition signed by voters equal to ten percent of the number of voters 306.23at the last regular town election is filed with the clerk, the certificates shall not be issued 306.24until their issuance has been approved by a majority of the votes cast on the question at 306.25a regular or special election. A tax levy shall be made to pay the principal and interest 306.26on the certificates as in the case of bonds.306.27    Sec. 46. Minnesota Statutes 2012, section 366.27, is amended to read:306.28366.27 FIREFIGHTERS' RELIEF; TAX LEVY.306.29    The town board of any town in this state having therein a platted portion on 306.30which resides 1,200 or more people, and wherein a duly incorporated firefighters' relief 306.31association is located may each year levy a tax not to exceed 0.00806 percent of taxable306.32 estimated market value for the benefit of the relief association.307.1    Sec. 47. Minnesota Statutes 2012, section 368.01, subdivision 23, is amended to read:307.2    Subd. 23. Financing purchase of certain equipment. The town board may issue 307.3certificates of indebtedness within debt limits to purchase fire or police equipment or 307.4ambulance equipment or street construction or maintenance equipment. The certificates 307.5shall be payable in not more than five years and be issued on terms and in the manner as the 307.6board may determine. If the amount of the certificates to be issued to finance a purchase 307.7exceeds 0.24177 percent of the estimated market value of the town, excluding money 307.8and credits, they shall not be issued for at least ten days after publication in the official 307.9newspaper of a town board resolution determining to issue them. If before the end of that 307.10time, a petition asking for an election on the proposition signed by voters equal to ten 307.11percent of the number of voters at the last regular town election is filed with the clerk, the 307.12certificates shall not be issued until the proposition of their issuance has been approved by a 307.13majority of the votes cast on the question at a regular or special election. A tax levy shall be 307.14made for the payment of the principal and interest on the certificates as in the case of bonds.307.15    Sec. 48. Minnesota Statutes 2012, section 368.47, is amended to read:307.16368.47 TOWNS MAY BE DISSOLVED.307.17    (1) When the voters residing within a town have failed to elect any town officials for 307.18more than ten years continuously;307.19    (2) when a town has failed for a period of ten years to exercise any of the powers 307.20and functions of a town;307.21    (3) when the estimated market value of a town drops to less than $165,000;307.22    (4) when the tax delinquency of a town, exclusive of taxes that are delinquent or 307.23unpaid because they are contested in proceedings for the enforcement of taxes, amounts to 307.2412 percent of its market value; or307.25    (5) when the state or federal government has acquired title to 50 percent of the 307.26real estate of a town,307.27which facts, or any of them, may be found and determined by the resolution of the county 307.28board of the county in which the town is located, according to the official records in the 307.29office of the county auditor, the county board by resolution may declare the town, naming 307.30it, dissolved and no longer entitled to exercise any of the powers or functions of a town.307.31    In Cass, Itasca, and St. Louis Counties, before the dissolution is effective the voters 307.32of the town shall express their approval or disapproval. The town clerk shall, upon a 307.33petition signed by a majority of the registered voters of the town, filed with the clerk at 307.34least 60 days before a regular or special town election, give notice at the same time and 307.35in the same manner of the election that the question of dissolution of the town will be 308.1submitted for determination at the election. At the election the question shall be voted 308.2upon by a separate ballot, the terms of which shall be either "for dissolution" or "against 308.3dissolution." The ballot shall be deposited in a separate ballot box and the result of the 308.4voting canvassed, certified, and returned in the same manner and at the same time as 308.5other facts and returns of the election. If a majority of the votes cast at the election are 308.6for dissolution, the town shall be dissolved. If a majority of the votes cast at the election 308.7are against dissolution, the town shall not be dissolved.308.8    When a town is dissolved under sections 
         368.47 to 
         368.49 the county shall acquire 308.9title to any telephone company or other business conducted by the town. The business 308.10shall be operated by the board of county commissioners until it can be sold. The 308.11subscribers or patrons of the business shall have the first opportunity of purchase. If the 308.12town has any outstanding indebtedness chargeable to the business, the county auditor shall 308.13levy a tax against the property situated in the dissolved town to pay the indebtedness 308.14as it becomes due.308.15    Sec. 49. Minnesota Statutes 2012, section 370.01, is amended to read:308.16370.01 CHANGE OF BOUNDARIES; CREATION OF NEW COUNTIES.308.17    The boundaries of counties may be changed by taking territory from a county and 308.18attaching it to an adjoining county, and new counties may be established out of territory of 308.19one or more existing counties. A new county shall contain at least 400 square miles and 308.20have at least 4,000 inhabitants. A proposed new county must have a total taxable estimated308.21 market value of at least 35 percent of (i) the total taxable estimated market value of the 308.22existing county, or (ii) the average total taxable estimated market value of the existing 308.23counties, included in the proposition. The determination of the taxable estimated market 308.24value of a county must be made by the commissioner of revenue. An existing county shall 308.25not be reduced in area below 400 square miles, have less than 4,000 inhabitants, or have a 308.26total taxable estimated market value of less than that required of a new county.308.27    No change in the boundaries of any county having an area of more than 2,500 square 308.28miles, whether by the creation of a new county, or otherwise, shall detach from the existing 308.29county any territory within 12 miles of the county seat.308.30    Sec. 50. Minnesota Statutes 2012, section 373.40, subdivision 1, is amended to read:308.31    Subdivision 1. Definitions. For purposes of this section, the following terms have 308.32the meanings given.308.33    (a) "Bonds" means an obligation as defined under section 
         475.51.309.1    (b) "Capital improvement" means acquisition or betterment of public lands, 309.2buildings, or other improvements within the county for the purpose of a county courthouse, 309.3administrative building, health or social service facility, correctional facility, jail, law 309.4enforcement center, hospital, morgue, library, park, qualified indoor ice arena, roads and 309.5bridges, and the acquisition of development rights in the form of conservation easements 309.6under chapter 84C. An improvement must have an expected useful life of five years or 309.7more to qualify. "Capital improvement" does not include a recreation or sports facility 309.8building (such as, but not limited to, a gymnasium, ice arena, racquet sports facility, 309.9swimming pool, exercise room or health spa), unless the building is part of an outdoor 309.10park facility and is incidental to the primary purpose of outdoor recreation.309.11    (c) "Metropolitan county" means a county located in the seven-county metropolitan 309.12area as defined in section 
         473.121 or a county with a population of 90,000 or more.309.13    (d) "Population" means the population established by the most recent of the 309.14following (determined as of the date the resolution authorizing the bonds was adopted):309.15    (1) the federal decennial census,309.16    (2) a special census conducted under contract by the United States Bureau of the 309.17Census, or309.18    (3) a population estimate made either by the Metropolitan Council or by the state 309.19demographer under section 
         4A.02.309.20    (e) "Qualified indoor ice arena" means a facility that meets the requirements of 309.21section 
         373.43.309.22    (f) "Tax capacity" means total taxable market value, but does not include captured 309.23market value.309.24    Sec. 51. Minnesota Statutes 2012, section 373.40, subdivision 4, is amended to read:309.25    Subd. 4. Limitations on amount. A county may not issue bonds under this section 309.26if the maximum amount of principal and interest to become due in any year on all the 309.27outstanding bonds issued pursuant to this section (including the bonds to be issued) will 309.28equal or exceed 0.12 percent of taxable the estimated market value of property in the 309.29county. Calculation of the limit must be made using the taxable estimated market value for 309.30the taxes payable year in which the obligations are issued and sold. This section does not 309.31limit the authority to issue bonds under any other special or general law.309.32    Sec. 52. Minnesota Statutes 2012, section 375.167, subdivision 1, is amended to read:309.33    Subdivision 1. Appropriations. Notwithstanding any contrary law, a county board 309.34may appropriate from the general revenue fund to any nonprofit corporation a sum not 310.1to exceed 0.00604 percent of taxable estimated market value to provide legal assistance 310.2to persons who are unable to afford private legal counsel.310.3    Sec. 53. Minnesota Statutes 2012, section 375.18, subdivision 3, is amended to read:310.4    Subd. 3. Courthouse. Each county board may erect, furnish, and maintain a 310.5suitable courthouse. No indebtedness shall be created for a courthouse in excess of an 310.6amount equal to a levy of 0.04030 percent of taxable estimated market value without the 310.7approval of a majority of the voters of the county voting on the question of issuing the 310.8obligation at an election.310.9    Sec. 54. Minnesota Statutes 2012, section 375.555, is amended to read:310.10375.555 FUNDING.310.11    To implement the county emergency jobs program, the county board may expend 310.12an amount equal to what would be generated by a levy of 0.01209 percent of taxable310.13 estimated market value. The money to be expended may be from any available funds 310.14not otherwise earmarked.310.15    Sec. 55. Minnesota Statutes 2012, section 383B.152, is amended to read:310.16383B.152 BUILDING AND MAINTENANCE FUND.310.17    The county board may by resolution levy a tax to provide money which shall be kept 310.18in a fund known as the county reserve building and maintenance fund. Money in the fund 310.19shall be used solely for the construction, maintenance, and equipping of county buildings 310.20that are constructed or maintained by the board. The levy shall not be subject to any limit 310.21fixed by any other law or by any board of tax levy or other corresponding body, but shall 310.22not exceed 0.02215 percent of taxable estimated market value, less the amount required by 310.23chapter 475 to be levied in the year for the payment of the principal of and interest on all 310.24bonds issued pursuant to Extra Session Laws 1967, chapter 47, section 1.310.25    Sec. 56. Minnesota Statutes 2012, section 383B.245, is amended to read:310.26383B.245 LIBRARY LEVY.310.27    (a) The county board may levy a tax on the taxable property within the county to 310.28acquire, better, and construct county library buildings and branches and to pay principal 310.29and interest on bonds issued for that purpose.310.30    (b) The county board may by resolution adopted by a five-sevenths vote issue and 310.31sell general obligation bonds of the county in the manner provided in sections 
         475.60 to 311.1475.73
         . The bonds shall not be subject to the limitations of sections 
         475.51 to 
         475.59, 311.2but the maturity years and amounts and interest rates of each series of bonds shall be 311.3fixed so that the maximum amount of principal and interest to become due in any year, 311.4on the bonds of that series and of all outstanding series issued by or for the purposes of 311.5libraries, shall not exceed an amount equal to 0.01612 percent of estimated market value 311.6of all taxable property in the county as last finally equalized before the issuance of the new 311.7series. When the tax levy authorized in this section is collected it shall be appropriated 311.8and credited to a debt service fund for the bonds in amounts required each year in lieu of a 311.9countywide tax levy for the debt service fund under section 
         475.61.311.10    Sec. 57. Minnesota Statutes 2012, section 383B.73, subdivision 1, is amended to read:311.11    Subdivision 1. Levy. To provide funds for the purposes of the Three Rivers Park 311.12District as set forth in its annual budget, in lieu of the levies authorized by any other 311.13special law for such purposes, the Board of Park District Commissioners may levy taxes 311.14on all the taxable property in the county and park district at a rate not exceeding 0.03224 311.15percent of estimated market value. Notwithstanding section 
         398.16, on or before October 311.161 of each year, after public hearing, the Board of Park District Commissioners shall adopt 311.17a budget for the ensuing year and shall determine the total amount necessary to be raised 311.18from ad valorem tax levies to meet its budget. The Board of Park District Commissioners 311.19shall submit the budget to the county board. The county board may veto or modify an item 311.20contained in the budget. If the county board determines to veto or to modify an item in the 311.21budget, it must, within 15 days after the budget was submitted by the district board, state 311.22in writing the specific reasons for its objection to the item vetoed or the reason for the 311.23modification. The Park District Board, after consideration of the county board's objections 311.24and proposed modifications, may reapprove a vetoed item or the original version of an item 311.25with respect to which a modification has been proposed, by a two-thirds majority. If the 311.26district board does not reapprove a vetoed item, the item shall be deleted from the budget. 311.27If the district board does not reapprove the original version of a modified item, the item 311.28shall be included in the budget as modified by the county board. After adoption of the final 311.29budget and no later than October 1, the superintendent of the park district shall certify to the 311.30office of the Hennepin County director of tax and public records exercising the functions 311.31of the county auditor the total amount to be raised from ad valorem tax levies to meet its 311.32budget for the ensuing year. The director of tax and public records shall add the amount of 311.33any levy certified by the district to other tax levies on the property of the county within the 311.34district for collection by the director of tax and public records with other taxes. When 312.1collected, the director shall make settlement of such taxes with the district in the same 312.2manner as other taxes are distributed to the other political subdivisions in Hennepin County.312.3    Sec. 58. Minnesota Statutes 2012, section 383E.20, is amended to read:312.4383E.20 BONDING FOR COUNTY LIBRARY BUILDINGS.312.5    The Anoka County Board may, by resolution adopted by a four-sevenths vote, issue 312.6and sell general obligation bonds of the county in the manner provided in chapter 475 to 312.7acquire, better, and construct county library buildings. The bonds shall not be subject to the 312.8requirements of sections 475.57 to 475.59. The maturity years and amounts and interest 312.9rates of each series of bonds shall be fixed so that the maximum amount of principal and 312.10interest to become due in any year, on the bonds of that series and of all outstanding series 312.11issued by or for the purposes of libraries, shall not exceed an amount equal to .01 percent 312.12of the taxable estimated market value of all taxable property in the county, excluding any 312.13taxable property taxed by any city for the support of any free public library. When the tax 312.14levy authorized in this section is collected, it shall be appropriated and credited to a debt 312.15service fund for the bonds. The tax levy for the debt service fund under section 475.61 312.16shall be reduced by the amount available or reasonably anticipated to be available in the 312.17fund to make payments otherwise payable from the levy pursuant to section 475.61.312.18    Sec. 59. Minnesota Statutes 2012, section 383E.23, is amended to read:312.19383E.23 LIBRARY TAX.312.20    The Anoka County Board may levy a tax of not more than .01 percent of the taxable312.21 estimated market value of taxable property located within the county excluding any 312.22taxable property taxed by any city for the support of any free public library, to acquire, 312.23better, and construct county library buildings and to pay principal and interest on bonds 312.24issued for that purpose. The tax shall be disregarded in the calculation of levies or limits 312.25on levies provided by section 373.40, or other law.312.26    Sec. 60. Minnesota Statutes 2012, section 385.31, is amended to read:312.27385.31 PAYMENT OF COUNTY ORDERS OR WARRANTS.312.28    When any order or warrant drawn on the treasurer is presented for payment, if there 312.29is money in the treasury for that purpose, the county treasurer shall redeem the same, and 312.30write across the entire face thereof the word "redeemed," the date of the redemption, and 312.31the treasurer's official signature. If there is not sufficient funds in the proper accounts to 312.32pay such orders they shall be numbered and registered in their order of presentation, 313.1and proper endorsement thereof shall be made on such orders and they shall be entitled 313.2to payment in like order. Such orders shall bear interest at not to exceed the rate of six 313.3percent per annum from such date of presentment. The treasurer, as soon as there is 313.4sufficient money in the treasury, shall appropriate and set apart a sum sufficient for the 313.5payment of the orders so presented and registered, and, if entitled to interest, issue to the 313.6original holder a notice that interest will cease in 30 days from the date of such notice; and, 313.7if orders thus entitled to priority of payment are not then presented, the next in order of 313.8registry may be paid until such orders are presented. No interest shall be paid on any order, 313.9except upon a warrant drawn by the county auditor for that purpose, giving the number 313.10and the date of the order on account of which the interest warrant is drawn. In any county 313.11in this state now or hereafter having a an estimated market value of all taxable property, 313.12exclusive of money and credits, of not less than $1,033,000,000, the county treasurer, in 313.13order to save payment of interest on county warrants drawn upon a fund in which there 313.14shall be temporarily insufficient money in the treasury to redeem the same, may borrow 313.15temporarily from any other fund in the county treasury in which there is a sufficient balance 313.16to care for the needs of such fund and allow a temporary loan or transfer to any other fund, 313.17and may pay such warrants out of such funds. Any such money so transferred and used in 313.18redeeming such county warrants shall be returned to the fund from which drawn as soon 313.19as money shall come in to the credit of such fund on which any such warrant was drawn 313.20and paid as aforesaid. Any county operating on a cash basis may use a combined form of 313.21warrant or order and check, which, when signed by the chair of the county board and by 313.22the auditor, is an order or warrant for the payment of the claim, and, when countersigned 313.23by the county treasurer, is a check for the payment of the amount thereof.313.24    Sec. 61. Minnesota Statutes 2012, section 394.36, subdivision 1, is amended to read:313.25    Subdivision 1. Continuation of nonconformity; limitations. Except as provided in 313.26subdivision 2, 3, or 4, any nonconformity, including the lawful use or occupation of land 313.27or premises existing at the time of the adoption of an official control under this chapter, 313.28may be continued, although the use or occupation does not conform to the official control. 313.29If the nonconformity or occupancy is discontinued for a period of more than one year, or 313.30any nonconforming building or structure is destroyed by fire or other peril to the extent of 313.3150 percent of its estimated market value, any subsequent use or occupancy of the land or 313.32premises shall be a conforming use or occupancy.313.33    Sec. 62. Minnesota Statutes 2012, section 398A.04, subdivision 8, is amended to read:314.1    Subd. 8. Taxation. Before deciding to exercise the power to tax, the authority shall 314.2give six weeks' published notice in all municipalities in the region. If a number of voters 314.3in the region equal to five percent of those who voted for candidates for governor at the 314.4last gubernatorial election present a petition within nine weeks of the first published notice 314.5to the secretary of state requesting that the matter be submitted to popular vote, it shall be 314.6submitted at the next general election. The question prepared shall be:314.7    "Shall the regional rail authority have the power to impose a property tax?

314.8Yes 
                     							.....
                     						314.9No 
                     							.....
                     						"

314.10    If a majority of those voting on the question approve or if no petition is presented 314.11within the prescribed time the authority may levy a tax at any annual rate not exceeding 314.120.04835 percent of estimated market value of all taxable property situated within the 314.13municipality or municipalities named in its organization resolution. Its recording officer 314.14shall file, on or before September 15, in the office of the county auditor of each county 314.15in which territory under the jurisdiction of the authority is located a certified copy of the 314.16board of commissioners' resolution levying the tax, and each county auditor shall assess 314.17and extend upon the tax rolls of each municipality named in the organization resolution the 314.18portion of the tax that bears the same ratio to the whole amount that the net tax capacity of 314.19taxable property in that municipality bears to the net tax capacity of taxable property in 314.20all municipalities named in the organization resolution. Collections of the tax shall be 314.21remitted by each county treasurer to the treasurer of the authority. For taxes levied in 1991, 314.22the amount levied for light rail transit purposes under this subdivision shall not exceed 75 314.23percent of the amount levied in 1990 for light rail transit purposes under this subdivision.314.24    Sec. 63. Minnesota Statutes 2012, section 401.05, subdivision 3, is amended to read:314.25    Subd. 3. Leasing. (a) A county or joint powers board of a group of counties 314.26which acquires or constructs and equips or improves facilities under this chapter may, 314.27with the approval of the board of county commissioners of each county, enter into a 314.28lease agreement with a city situated within any of the counties, or a county housing and 314.29redevelopment authority established under chapter 469 or any special law. Under the lease 314.30agreement, the city or county housing and redevelopment authority shall:314.31    (1) construct or acquire and equip or improve a facility in accordance with plans 314.32prepared by or at the request of a county or joint powers board of the group of counties 314.33and approved by the commissioner of corrections; and314.34    (2) finance the facility by the issuance of revenue bonds.315.1    (b) The county or joint powers board of a group of counties may lease the facility 315.2site, improvements, and equipment for a term upon rental sufficient to produce revenue 315.3for the prompt payment of the revenue bonds and all interest accruing on them. Upon 315.4completion of payment, the lessee shall acquire title. The real and personal property 315.5acquired for the facility constitutes a project and the lease agreement constitutes a revenue 315.6agreement as provided in sections 
         469.152 to 
         469.165. All proceedings by the city or 315.7county housing and redevelopment authority and the county or joint powers board shall be 315.8as provided in sections 
         469.152 to 
         469.165, with the following adjustments:315.9    (1) no tax may be imposed upon the property;315.10    (2) the approval of the project by the commissioner of employment and economic 315.11development is not required;315.12    (3) the Department of Corrections shall be furnished and shall record information 315.13concerning each project as it may prescribe, in lieu of reports required on other projects to 315.14the commissioner of employment and economic development;315.15    (4) the rentals required to be paid under the lease agreement shall not exceed in any 315.16year one-tenth of one percent of the estimated market value of property within the county 315.17or group of counties as last equalized before the execution of the lease agreement;315.18    (5) the county or group of counties shall provide for payment of all rentals due 315.19during the term of the lease agreement in the manner required in subdivision 4;315.20    (6) no mortgage on the facilities shall be granted for the security of the bonds, but 315.21compliance with clause (5) may be enforced as a nondiscretionary duty of the county 315.22or group of counties; and315.23    (7) the county or the joint powers board of the group of counties may sublease any 315.24part of the facilities for purposes consistent with their maintenance and operation.315.25    Sec. 64. Minnesota Statutes 2012, section 410.32, is amended to read:315.26410.32 CITIES MAY ISSUE CAPITAL NOTES FOR CAPITAL EQUIPMENT.315.27    (a) Notwithstanding any contrary provision of other law or charter, a home rule 315.28charter city may, by resolution and without public referendum, issue capital notes subject 315.29to the city debt limit to purchase capital equipment.315.30    (b) For purposes of this section, "capital equipment" means:315.31    (1) public safety equipment, ambulance and other medical equipment, road 315.32construction and maintenance equipment, and other capital equipment; and315.33    (2) computer hardware and software, whether bundled with machinery or equipment 315.34or unbundled.316.1    (c) The equipment or software must have an expected useful life at least as long 316.2as the term of the notes.316.3    (d) The notes shall be payable in not more than ten years and be issued on terms 316.4and in the manner the city determines. The total principal amount of the capital notes 316.5issued in a fiscal year shall not exceed 0.03 percent of the estimated market value of 316.6taxable property in the city for that year.316.7    (e) A tax levy shall be made for the payment of the principal and interest on the 316.8notes, in accordance with section 
         475.61, as in the case of bonds.316.9    (f) Notes issued under this section shall require an affirmative vote of two-thirds of 316.10the governing body of the city.316.11    (g) Notwithstanding a contrary provision of other law or charter, a home rule charter 316.12city may also issue capital notes subject to its debt limit in the manner and subject to the 316.13limitations applicable to statutory cities pursuant to section 
         412.301.316.14    Sec. 65. Minnesota Statutes 2012, section 412.221, subdivision 2, is amended to read:316.15    Subd. 2. Contracts. The council shall have power to make such contracts as may 316.16be deemed necessary or desirable to make effective any power possessed by the council. 316.17The city may purchase personal property through a conditional sales contract and real 316.18property through a contract for deed under which contracts the seller is confined to the 316.19remedy of recovery of the property in case of nonpayment of all or part of the purchase 316.20price, which shall be payable over a period of not to exceed five years. When the contract 316.21price of property to be purchased by contract for deed or conditional sales contract 316.22exceeds 0.24177 percent of the estimated market value of the city, the city may not enter 316.23into such a contract for at least ten days after publication in the official newspaper of a 316.24council resolution determining to purchase property by such a contract; and, if before the 316.25end of that time a petition asking for an election on the proposition signed by voters equal 316.26to ten percent of the number of voters at the last regular city election is filed with the clerk, 316.27the city may not enter into such a contract until the proposition has been approved by a 316.28majority of the votes cast on the question at a regular or special election.316.29    Sec. 66. Minnesota Statutes 2012, section 412.301, is amended to read:316.30412.301 FINANCING PURCHASE OF CERTAIN EQUIPMENT.316.31    (a) The council may issue certificates of indebtedness or capital notes subject to the 316.32city debt limits to purchase capital equipment.316.33    (b) For purposes of this section, "capital equipment" means:317.1    (1) public safety equipment, ambulance and other medical equipment, road 317.2construction and maintenance equipment, and other capital equipment; and317.3    (2) computer hardware and software, whether bundled with machinery or equipment 317.4or unbundled.317.5    (c) The equipment or software must have an expected useful life at least as long as 317.6the terms of the certificates or notes.317.7    (d) Such certificates or notes shall be payable in not more than ten years and shall be 317.8issued on such terms and in such manner as the council may determine.317.9    (e) If the amount of the certificates or notes to be issued to finance any such purchase 317.10exceeds 0.25 percent of the estimated market value of taxable property in the city, they 317.11shall not be issued for at least ten days after publication in the official newspaper of 317.12a council resolution determining to issue them; and if before the end of that time, a 317.13petition asking for an election on the proposition signed by voters equal to ten percent 317.14of the number of voters at the last regular municipal election is filed with the clerk, such 317.15certificates or notes shall not be issued until the proposition of their issuance has been 317.16approved by a majority of the votes cast on the question at a regular or special election.317.17    (f) A tax levy shall be made for the payment of the principal and interest on such 317.18certificates or notes, in accordance with section 
         475.61, as in the case of bonds.317.19    Sec. 67. Minnesota Statutes 2012, section 428A.02, subdivision 1, is amended to read:317.20    Subdivision 1. Ordinance. The governing body of a city may adopt an ordinance 317.21establishing a special service district. Only property that is classified under section 
         273.13317.22and used for commercial, industrial, or public utility purposes, or is vacant land zoned or 317.23designated on a land use plan for commercial or industrial use and located in the special 317.24service district, may be subject to the charges imposed by the city on the special service 317.25district. Other types of property may be included within the boundaries of the special 317.26service district but are not subject to the levies or charges imposed by the city on the 317.27special service district. If 50 percent or more of the estimated market value of a parcel of 317.28property is classified under section 
         273.13 as commercial, industrial, or vacant land zoned 317.29or designated on a land use plan for commercial or industrial use, or public utility for the 317.30current assessment year, then the entire taxable market value of the property is subject to a 317.31service charge based on net tax capacity for purposes of sections 
         428A.01 to 
         428A.10. 317.32The ordinance shall describe with particularity the area within the city to be included in 317.33the district and the special services to be furnished in the district. The ordinance may not 317.34be adopted until after a public hearing has been held on the question. Notice of the hearing 317.35shall include the time and place of hearing, a map showing the boundaries of the proposed 318.1district, and a statement that all persons owning property in the proposed district that 318.2would be subject to a service charge will be given opportunity to be heard at the hearing. 318.3Within 30 days after adoption of the ordinance under this subdivision, the governing body 318.4shall send a copy of the ordinance to the commissioner of revenue.318.5    Sec. 68. Minnesota Statutes 2012, section 430.102, subdivision 2, is amended to read:318.6    Subd. 2. Council approval; special tax levy limitation. The council shall receive 318.7and consider the estimate required in subdivision 1 and the items of cost after notice and 318.8hearing before it or its appropriate committee as it considers necessary or expedient, and 318.9shall approve the estimate, with necessary amendments. The amounts of each item of cost 318.10estimated are then appropriated to operate, maintain, and improve the pedestrian mall 318.11during the next fiscal year. The amount of the special tax to be charged under subdivision 318.121, clause (3), must not, however, exceed 0.12089 percent of estimated market value of 318.13taxable property in the district. The council shall make any necessary adjustment in costs of 318.14operating and maintaining the district to keep the amount of the tax within this limitation.318.15    Sec. 69. Minnesota Statutes 2012, section 447.10, is amended to read:318.16447.10 TAX LEVY FOR OPERATING AND MAINTAINING HOSPITAL.318.17    The governing body of a city of the first class owning a hospital may annually levy 318.18a tax to operate and maintain the hospital. The tax must not exceed 0.00806 percent of 318.19taxable estimated market value.318.20    Sec. 70. Minnesota Statutes 2012, section 450.19, is amended to read:318.21450.19 TOURIST CAMPING GROUNDS.318.22    A home rule charter or statutory city or town may establish and maintain public 318.23tourist camping grounds. The governing body thereof may acquire by lease, purchase, or 318.24gift, suitable lands located either within or without the corporate limits for use as public 318.25tourist camping grounds and provide for the equipment, operation, and maintenance 318.26of the same. The amount that may be expended for the maintenance, improvement, or 318.27operation of tourist camping grounds shall not exceed, in any year, a sum equal to 0.00806 318.28percent of taxable estimated market value.318.29    Sec. 71. Minnesota Statutes 2012, section 450.25, is amended to read:318.30450.25 MUSEUM, GALLERY, OR SCHOOL OF ARTS OR CRAFTS; TAX 318.31LEVY.319.1    After the acquisition of any museum, gallery, or school of arts or crafts, the board 319.2of park commissioners of the city in which it is located shall cause to be included in the 319.3annual tax levy upon all the taxable property of the county in which the museum, gallery, 319.4or school of arts or crafts is located, a tax of 0.00846 percent of estimated market value. 319.5The board shall certify the levy to the county auditor and it shall be added to, and collected 319.6with and as part of, the general, real, and personal property taxes, with like penalties and 319.7interest, in case of nonpayment and default, and all provisions of law in respect to the 319.8levy, collection, and enforcement of other taxes shall, so far as applicable, be followed in 319.9respect of these taxes. All of these taxes, penalties, and interest, when collected, shall be 319.10paid to the city treasurer of the city in which is located the museum, gallery, or school 319.11of arts or crafts and credited to a fund to be known as the park museum fund, and shall 319.12be used only for the purposes specified in sections 
         450.23 to 
         450.25. Any part of the 319.13proceeds of the levy not expended for the purposes specified in section 
         450.24 may be 319.14used for the erection of new buildings for the same purposes.319.15    Sec. 72. Minnesota Statutes 2012, section 458A.10, is amended to read:319.16458A.10 PROPERTY TAX.319.17    The commission shall annually levy a tax not to exceed 0.12089 percent of estimated 319.18market value on all the taxable property in the transit area at a rate sufficient to produce 319.19an amount necessary for the purposes of sections 
         458A.01 to 
         458A.15, other than the 319.20payment of principal and interest due on any revenue bonds issued pursuant to section 319.21458A.05
         . Property taxes levied under this section shall be certified by the commission to 319.22the county auditors of the transit area, extended, assessed, and collected in the manner 319.23provided by law for the property taxes levied by the governing bodies of cities. The 319.24proceeds of the taxes levied under this section shall be remitted by the respective county 319.25treasurers to the treasurer of the commission, who shall credit the same to the funds of 319.26the commission for use for the purposes of sections 
         458A.01 to 
         458A.15 subject to any 319.27applicable pledges or limitations on account of tax anticipation certificates or other 319.28specific purposes. At any time after making a tax levy under this section and certifying 319.29it to the county auditors, the commission may issue general obligation certificates of 319.30indebtedness in anticipation of the collection of the taxes as provided by section 
         412.261.319.31    Sec. 73. Minnesota Statutes 2012, section 458A.31, subdivision 1, is amended to read:319.32    Subdivision 1. Levy limit. Notwithstanding anything to the contrary contained in 319.33the charter of the city of Duluth, any ordinance thereof, or any statute applicable thereto, 319.34limiting the amount levied in any one year for general or special purposes, the city council 320.1of the city of Duluth shall each year levy a tax in an amount not to exceed 0.07253 320.2percent of taxable estimated market value, by ordinance. An ordinance fixing the levy 320.3shall take effect immediately upon its passage and approval. The proceeds of the levy 320.4shall be paid into the city treasury and deposited in the operating fund provided for in 320.5section 
         458A.24, subdivision 3.320.6    Sec. 74. Minnesota Statutes 2012, section 465.04, is amended to read:320.7465.04 ACCEPTANCE OF GIFTS.320.8    Cities of the second, third, or fourth class, having at any time a an estimated320.9 market value of not more than $41,000,000, exclusive of money and credits, as officially 320.10equalized by the commissioner of revenue, either under home rule charter or under the 320.11laws of this state, in addition to all other powers possessed by them, hereby are authorized 320.12and empowered to receive and accept gifts and donations for the use and benefit of 320.13such cities and the inhabitants thereof upon terms and conditions to be approved by the 320.14governing bodies of such cities; and such cities are authorized to comply with and perform 320.15such terms and conditions, which may include payment to the donor or donors of interest 320.16on the value of the gift at not exceeding five percent per annum payable annually or 320.17semiannually, during the remainder of the natural life or lives of such donor or donors.320.18    Sec. 75. Minnesota Statutes 2012, section 469.033, subdivision 6, is amended to read:320.19    Subd. 6. Operation area as taxing district, special tax. All of the territory included 320.20within the area of operation of any authority shall constitute a taxing district for the 320.21purpose of levying and collecting special benefit taxes as provided in this subdivision. All 320.22of the taxable property, both real and personal, within that taxing district shall be deemed 320.23to be benefited by projects to the extent of the special taxes levied under this subdivision. 320.24Subject to the consent by resolution of the governing body of the city in and for which 320.25it was created, an authority may levy a tax upon all taxable property within that taxing 320.26district. The tax shall be extended, spread, and included with and as a part of the general 320.27taxes for state, county, and municipal purposes by the county auditor, to be collected and 320.28enforced therewith, together with the penalty, interest, and costs. As the tax, including any 320.29penalties, interest, and costs, is collected by the county treasurer it shall be accumulated 320.30and kept in a separate fund to be known as the "housing and redevelopment project fund." 320.31The money in the fund shall be turned over to the authority at the same time and in the same 320.32manner that the tax collections for the city are turned over to the city, and shall be expended 320.33only for the purposes of sections 
         469.001 to 
         469.047. It shall be paid out upon vouchers 320.34signed by the chair of the authority or an authorized representative. The amount of the 321.1levy shall be an amount approved by the governing body of the city, but shall not exceed 321.20.0185 percent of taxable estimated market value. The authority shall each year formulate 321.3and file a budget in accordance with the budget procedure of the city in the same manner as 321.4required of executive departments of the city or, if no budgets are required to be filed, by 321.5August 1. The amount of the tax levy for the following year shall be based on that budget.321.6    Sec. 76. Minnesota Statutes 2012, section 469.034, subdivision 2, is amended to read:321.7    Subd. 2. General obligation revenue bonds. (a) An authority may pledge the 321.8general obligation of the general jurisdiction governmental unit as additional security for 321.9bonds payable from income or revenues of the project or the authority. The authority 321.10must find that the pledged revenues will equal or exceed 110 percent of the principal and 321.11interest due on the bonds for each year. The proceeds of the bonds must be used for a 321.12qualified housing development project or projects. The obligations must be issued and 321.13sold in the manner and following the procedures provided by chapter 475, except the 321.14obligations are not subject to approval by the electors, and the maturities may extend to 321.15not more than 35 years for obligations sold to finance housing for the elderly and 40 years 321.16for other obligations issued under this subdivision. The authority is the municipality for 321.17purposes of chapter 475.321.18    (b) The principal amount of the issue must be approved by the governing body of 321.19the general jurisdiction governmental unit whose general obligation is pledged. Public 321.20hearings must be held on issuance of the obligations by both the authority and the general 321.21jurisdiction governmental unit. The hearings must be held at least 15 days, but not more 321.22than 120 days, before the sale of the obligations.321.23    (c) The maximum amount of general obligation bonds that may be issued and 321.24outstanding under this section equals the greater of (1) one-half of one percent of the 321.25taxable estimated market value of the general jurisdiction governmental unit whose 321.26general obligation is pledged, or (2) $3,000,000. In the case of county or multicounty 321.27general obligation bonds, the outstanding general obligation bonds of all cities in the 321.28county or counties issued under this subdivision must be added in calculating the limit 321.29under clause (1).321.30    (d) "General jurisdiction governmental unit" means the city in which the housing 321.31development project is located. In the case of a county or multicounty authority, the 321.32county or counties may act as the general jurisdiction governmental unit. In the case of 321.33a multicounty authority, the pledge of the general obligation is a pledge of a tax on the 321.34taxable property in each of the counties.322.1    (e) "Qualified housing development project" means a housing development project 322.2providing housing either for the elderly or for individuals and families with incomes not 322.3greater than 80 percent of the median family income as estimated by the United States 322.4Department of Housing and Urban Development for the standard metropolitan statistical 322.5area or the nonmetropolitan county in which the project is located. The project must be 322.6owned for the term of the bonds either by the authority or by a limited partnership or other 322.7entity in which the authority or another entity under the sole control of the authority is 322.8the sole general partner and the partnership or other entity must receive (1) an allocation 322.9from the Department of Management and Budget or an entitlement issuer of tax-exempt 322.10bonding authority for the project and a preliminary determination by the Minnesota 322.11Housing Finance Agency or the applicable suballocator of tax credits that the project 322.12will qualify for four percent low-income housing tax credits or (2) a reservation of nine 322.13percent low-income housing tax credits from the Minnesota Housing Finance Agency or a 322.14suballocator of tax credits for the project. A qualified housing development project may 322.15admit nonelderly individuals and families with higher incomes if:322.16    (1) three years have passed since initial occupancy;322.17    (2) the authority finds the project is experiencing unanticipated vacancies resulting in 322.18insufficient revenues, because of changes in population or other unforeseen circumstances 322.19that occurred after the initial finding of adequate revenues; and322.20    (3) the authority finds a tax levy or payment from general assets of the general 322.21jurisdiction governmental unit will be necessary to pay debt service on the bonds if higher 322.22income individuals or families are not admitted.322.23    (f) The authority may issue bonds to refund bonds issued under this subdivision in 322.24accordance with section 
         475.67. The finding of the adequacy of pledged revenues required 322.25by paragraph (a) and the public hearing required by paragraph (b) shall not apply to the 322.26issuance of refunding bonds. This paragraph applies to refunding bonds issued on and 322.27after July 1, 1992.322.28    Sec. 77. Minnesota Statutes 2012, section 469.053, subdivision 4, is amended to read:322.29    Subd. 4. Mandatory city levy. A city shall, at the request of the port authority, levy 322.30a tax in any year for the benefit of the port authority. The tax must not exceed 0.01813 322.31percent of taxable estimated market value. The amount levied must be paid by the city 322.32treasurer to the treasurer of the port authority, to be spent by the authority.322.33    Sec. 78. Minnesota Statutes 2012, section 469.053, subdivision 4a, is amended to read:323.1    Subd. 4a. Seaway port authority levy. A levy made under this subdivision shall 323.2replace the mandatory city levy under subdivision 4. A seaway port authority is a special 323.3taxing district under section 
         275.066 and may levy a tax in any year for the benefit of the 323.4seaway port authority. The tax must not exceed 0.01813 percent of taxable estimated323.5 market value. The county auditor shall distribute the proceeds of the property tax levy to 323.6the seaway port authority.323.7    Sec. 79. Minnesota Statutes 2012, section 469.053, subdivision 6, is amended to read:323.8    Subd. 6. Discretionary city levy. Upon request of a port authority, the port 323.9authority's city may levy a tax to be spent by and for its port authority. The tax must 323.10enable the port authority to carry out efficiently and in the public interest sections 
         469.048323.11to 
         469.068 to create and develop industrial development districts. The levy must not be 323.12more than 0.00282 percent of taxable estimated market value. The county treasurer shall 323.13pay the proceeds of the tax to the port authority treasurer. The money may be spent by 323.14the authority in performance of its duties to create and develop industrial development 323.15districts. In spending the money the authority must judge what best serves the public 323.16interest. The levy in this subdivision is in addition to the levy in subdivision 4.323.17    Sec. 80. Minnesota Statutes 2012, section 469.107, subdivision 1, is amended to read:323.18    Subdivision 1. City tax levy. A city may, at the request of the authority, levy a tax in 323.19any year for the benefit of the authority. The tax must be not more than 0.01813 percent of 323.20taxable estimated market value. The amount levied must be paid by the city treasurer to 323.21the treasurer of the authority, to be spent by the authority.323.22    Sec. 81. Minnesota Statutes 2012, section 469.180, subdivision 2, is amended to read:323.23    Subd. 2. Tax levies. Notwithstanding any law, the county board of any county may 323.24appropriate from the general revenue fund a sum not to exceed a county levy of 0.00080 323.25percent of taxable estimated market value to carry out the purposes of this section.323.26    Sec. 82. Minnesota Statutes 2012, section 469.187, is amended to read:323.27469.187 FIRST CLASS CITY SPENDING FOR PUBLICITY; PUBLICITY 323.28BOARD.323.29    Any city of the first class may expend money for city publicity purposes. The city may 323.30levy a tax, not exceeding 0.00080 percent of taxable estimated market value. The proceeds 323.31of the levy shall be expended in the manner and for the city publicity purposes the council 324.1directs. The council may establish and provide for a publicity board or bureau to administer 324.2the fund, subject to the conditions and limitations the council prescribes by ordinance.324.3    Sec. 83. Minnesota Statutes 2012, section 469.206, is amended to read:324.4469.206 HAZARDOUS PROPERTY PENALTY.324.5    A city may assess a penalty up to one percent of the estimated market value of 324.6real property, including any building located within the city that the city determines to 324.7be hazardous as defined in section 
         463.15, subdivision 3. The city shall send a written 324.8notice to the address to which the property tax statement is sent at least 90 days before it 324.9may assess the penalty. If the owner of the property has not paid the penalty or fixed the 324.10property within 90 days after receiving notice of the penalty, the penalty is considered 324.11delinquent and is increased by 25 percent each 60 days the penalty is not paid and the 324.12property remains hazardous. For the purposes of this section, a penalty that is delinquent 324.13is considered a delinquent property tax and subject to chapters 279, 280, and 281, in the 324.14same manner as delinquent property taxes.324.15    Sec. 84. Minnesota Statutes 2012, section 471.24, is amended to read:324.16471.24 TOWNS, STATUTORY CITIES; JOINT MAINTENANCE OF 324.17CEMETERY.324.18    Where a statutory city or town owns and maintains an established cemetery or burial 324.19ground, either within or without the municipal limits, the statutory city or town may, by 324.20mutual agreement with contiguous statutory cities and towns, each having a an estimated324.21 market value of not less than $2,000,000, join together in the maintenance of such public 324.22cemetery or burial ground for the use of the inhabitants of each of such municipalities; and 324.23each such municipality is hereby authorized, by action of its council or governing body, 324.24to levy a tax or make an appropriation for the annual support and maintenance of such 324.25cemetery or burial ground; provided, the amount thus appropriated by each municipality 324.26shall not exceed a total of $10,000 in any one year.324.27    Sec. 85. Minnesota Statutes 2012, section 471.571, subdivision 1, is amended to read:324.28    Subdivision 1. Application. This section applies to each city in which the net tax 324.29capacity of real and personal property consists in part of iron ore or lands containing 324.30taconite or semitaconite and in which the total taxable estimated market value of real 324.31and personal property exceeds $2,500,000.324.32    Sec. 86. Minnesota Statutes 2012, section 471.571, subdivision 2, is amended to read:325.1    Subd. 2. Creation of fund, tax levy. The governing body of the city may create a 325.2permanent improvement and replacement fund to be maintained by an annual tax levy. 325.3The governing body may levy a tax in excess of any charter limitation for the support of 325.4the permanent improvement and replacement fund, but not exceeding the following:325.5    (a) in cities having a population of not more than 500 inhabitants, the lesser of $20 325.6per capita or 0.08059 percent of taxable estimated market value;325.7    (b) in cities having a population of more than 500 and less than 2500 2,500, the 325.8greater of $12.50 per capita or $10,000 but not exceeding 0.08059 percent of taxable325.9 estimated market value;325.10    (c) in cities having a population of more than 2500 2,500 or more inhabitants, 325.11the greater of $10 per capita or $31,500 but not exceeding 0.08059 percent of taxable325.12 estimated market value.325.13    Sec. 87. Minnesota Statutes 2012, section 471.73, is amended to read:325.14471.73 ACCEPTANCE OF PROVISIONS.325.15    In the case of any city within the class specified in section471.72 having a an 325.16estimated market value, as defined in section 471.72, in excess of $37,000,000; and in the 325.17case of any statutory city within such class having a an estimated market value, as defined 325.18in section 471.72, of less than $5,000,000; and in the case of any statutory city within such 325.19class which is governed by Laws 1933, chapter 211, or Laws 1937, chapter 356; and in 325.20the case of any statutory city within such class which is governed by Laws 1929, chapter 325.21208, and has a an estimated market value of less than $83,000,000; and in the case of 325.22any school district within such class having a an estimated market value, as defined in 325.23section 471.72, of more than $54,000,000; and in the case of all towns within said class; 325.24sections 
         471.71 to 
         471.83 apply only if the governing body of the city or statutory city, the 325.25board of the school district, or the town board of the town shall have adopted a resolution 325.26determining to issue bonds under the provisions of sections 
         471.71 to 
         471.83 or to go 325.27upon a cash basis in accordance with the provisions thereof.325.28    Sec. 88. Minnesota Statutes 2012, section 473.325, subdivision 2, is amended to read:325.29    Subd. 2. Chapter 475 applies; exceptions. The Metropolitan Council shall sell and 325.30issue the bonds in the manner provided in chapter 475, and shall have the same powers 325.31and duties as a municipality issuing bonds under that law, except that the approval of a 325.32majority of the electors shall not be required and the net debt limitations shall not apply. 325.33The terms of each series of bonds shall be fixed so that the amount of principal and interest 325.34on all outstanding and undischarged bonds, together with the bonds proposed to be issued, 326.1due in any year shall not exceed 0.01209 percent of estimated market value of all taxable 326.2property in the metropolitan area as last finally equalized prior to a proposed issue. The 326.3bonds shall be secured in accordance with section 
         475.61, subdivision 1, and any taxes 326.4required for their payment shall be levied by the council, shall not affect the amount or rate 326.5of taxes which may be levied by the council for other purposes, shall be spread against all 326.6taxable property in the metropolitan area and shall not be subject to limitation as to rate or 326.7amount. Any taxes certified by the council to the county auditors for collection shall be 326.8reduced by the amount received by the council from the commissioner of management and 326.9budget or the federal government for the purpose of paying the principal and interest on 326.10bonds to which the levy relates. The council shall certify the fact and amount of all money 326.11so received to the county auditors, and the auditors shall reduce the levies previously made 326.12for the bonds in the manner and to the extent provided in section 
         475.61, subdivision 3.326.13    Sec. 89. Minnesota Statutes 2012, section 473.629, is amended to read:326.14473.629 VALUE OF PROPERTY FOR BOND ISSUES BY SCHOOL 326.15DISTRICTS.326.16    As to any lands to be detached from any school district under the provisions hereof326.17 section 473.625, notwithstanding such prospective the detachment, the estimated market 326.18value of such the detached lands and the net tax capacity of taxable properties now located 326.19therein or thereon shall be and on the lands on the date of the detachment constitute 326.20from and after the date of the enactment hereof a part of the estimated market value of 326.21properties upon the basis of which such used to calculate the net debt limit of the school 326.22district may issue its bonds,. The value of such the lands for such purpose to be and other 326.23taxable properties for purposes of the school district's net debt limit are 33-1/3 percent of 326.24the estimated market value thereof as determined and certified by said the assessor to said326.25 the school district, and it shall be the duty of such the assessor annually on or before the 326.26tenth day of October from and after the passage hereof, to so of each year, shall determine 326.27and certify that value; provided, however, that the value of such the detached lands and 326.28such taxable properties shall never exceed 20 percent of the estimated market value of 326.29all properties constituting and making up the basis aforesaid used to calculate the net 326.30debt limit of the school district.326.31    Sec. 90. Minnesota Statutes 2012, section 473.661, subdivision 3, is amended to read:326.32    Subd. 3. Levy limit. In any budget certified by the commissioners under this section, 326.33the amount included for operation and maintenance shall not exceed an amount which, 326.34when extended against the property taxable therefor under section 
         473.621, subdivision 5, 327.1will require a levy at a rate of 0.00806 percent of estimated market value. Taxes levied by 327.2the corporation shall not affect the amount or rate of taxes which may be levied by any other 327.3local government unit within the metropolitan area under the provisions of any charter.327.4    Sec. 91. Minnesota Statutes 2012, section 473.667, subdivision 9, is amended to read:327.5    Subd. 9. Additional taxes. Nothing herein shall prevent the commission from 327.6levying a tax not to exceed 0.00121 percent of estimated market value on taxable property 327.7within its taxing jurisdiction, in addition to any levies found necessary for the debt 327.8service fund authorized by section 
         473.671. Nothing herein shall prevent the levy and 327.9appropriation for purposes of the commission of any other tax on property or on any 327.10income, transaction, or privilege, when and if authorized by law. All collections of any 327.11taxes so levied shall be included in the revenues appropriated for the purposes referred 327.12to in this section, unless otherwise provided in the law authorizing the levies; but no 327.13covenant as to the continuance or as to the rate and amount of any such levy shall be made 327.14with the holders of the commission's bonds unless specifically authorized by law.327.15    Sec. 92. Minnesota Statutes 2012, section 473.671, is amended to read:327.16473.671 LIMIT OF TAX LEVY.327.17    The taxes levied against the property of the metropolitan area in any one year shall 327.18not exceed 0.00806 percent of taxable estimated market value, exclusive of taxes levied 327.19to pay the principal or interest on any bonds or indebtedness of the city issued under 327.20Laws 1943, chapter 500, and exclusive of any taxes levied to pay the share of the city for 327.21payments on bonded indebtedness of the corporation provided for in Laws 1943, chapter 327.22500. The levy of taxes authorized in Laws 1943, chapter 500, shall be in addition to the 327.23maximum rate allowed to be levied to defray the cost of government under the provisions 327.24of the charter of any city affected by Laws 1943, chapter 500.327.25    Sec. 93. Minnesota Statutes 2012, section 473.711, subdivision 2a, is amended to read:327.26    Subd. 2a. Tax levy. (a) The commission may levy a tax on all taxable property in the 327.27district as defined in section 
         473.702 to provide funds for the purposes of sections 
         473.701327.28to 
         473.716. The tax shall not exceed the property tax levy limitation determined in this 327.29subdivision. A participating county may agree to levy an additional tax to be used by the 327.30commission for the purposes of sections 
         473.701 to 
         473.716 but the sum of the county's and 327.31commission's taxes may not exceed the county's proportionate share of the property tax levy 327.32limitation determined under this subdivision based on the ratio of its total net tax capacity 327.33to the total net tax capacity of the entire district as adjusted by section 
         270.12, subdivision 328.13
         . The auditor of each county in the district shall add the amount of the levy made by the 328.2district to other taxes of the county for collection by the county treasurer with other taxes. 328.3When collected, the county treasurer shall make settlement of the tax with the district in 328.4the same manner as other taxes are distributed to political subdivisions. No county shall 328.5levy any tax for mosquito, disease vectoring tick, and black gnat (Simuliidae) control 328.6except under this section. The levy shall be in addition to other taxes authorized by law.328.7    (b) The property tax levied by the Metropolitan Mosquito Control Commission shall 328.8not exceed the product of (i) the commission's property tax levy limitation for the previous 328.9year determined under this subdivision multiplied by (ii) an index for market valuation 328.10changes equal to the total estimated market valuation value of all taxable property for the 328.11current tax payable year located within the district plus any area that has been added to the 328.12district since the previous year, divided by the total estimated market valuation value of all 328.13taxable property located within the district for the previous taxes payable year.328.14    (c) For the purpose of determining the commission's property tax levy limitation 328.15under this subdivision, "total market valuation" means the total market valuation of all 328.16taxable property within the district without valuation adjustments for fiscal disparities 328.17(chapter 473F), tax increment financing (sections 469.174 to 469.179), and high voltage 328.18transmission lines (section 273.425).328.19    Sec. 94. Minnesota Statutes 2012, section 473F.02, subdivision 12, is amended to read:328.20    Subd. 12. Adjusted market value. "Adjusted market value" of real and personal 328.21property within a municipality means the assessor's estimated taxable market value, 328.22as defined in section 272.03, of all real and personal property, including the value of 328.23manufactured housing, within the municipality, adjusted for sales ratios in a manner 328.24similar to the adjustments made to city and town net tax capacities. For purposes 328.25of sections 473F.01 to 473F.13, the commissioner of revenue shall annually make 328.26determinations and reports with respect to each municipality which are comparable to 328.27those it makes for school districts under section 
         127A.48, subdivisions 1 to 6, in the same 328.28manner and at the same times as are prescribed by the subdivisions. The commissioner 328.29of revenue shall annually determine, for each municipality, information comparable to 328.30that required by section 475.53, subdivision 4, for school districts, as soon as practicable 328.31after it becomes available. The commissioner of revenue shall then compute the equalized 328.32market value of property within each municipality using the aggregate sales ratios from 328.33the Department of Revenue's sales ratio study.328.34    Sec. 95. Minnesota Statutes 2012, section 473F.02, subdivision 14, is amended to read:329.1    Subd. 14. Fiscal capacity. "Fiscal capacity" of a municipality means its valuation329.2 adjusted market value, determined as of January 2 of any year, divided by its population, 329.3determined as of a date in the same year.329.4    Sec. 96. Minnesota Statutes 2012, section 473F.02, subdivision 15, is amended to read:329.5    Subd. 15. Average fiscal capacity. "Average fiscal capacity" of municipalities 329.6means the sum of the valuations adjusted market values of all municipalities, determined 329.7as of January 2 of any year, divided by the sum of their populations, determined as of 329.8a date in the same year.329.9    Sec. 97. Minnesota Statutes 2012, section 473F.02, subdivision 23, is amended to read:329.10    Subd. 23. Net tax capacity. "Net tax capacity" means the taxable market value of 329.11real and personal property multiplied by its net tax capacity rates in section 
         273.13.329.12    Sec. 98. Minnesota Statutes 2012, section 473F.08, subdivision 10, is amended to read:329.13    Subd. 10. Adjustment of value or net tax capacity. For the purpose of computing 329.14the amount or rate of any salary, aid, tax, or debt authorized, required, or limited by any 329.15provision of any law or charter, where such authorization, requirement, or limitation 329.16is related in any manner to any value or valuation of taxable property within any 329.17governmental unit, such value or net tax capacity fiscal capacity under section 473F.02, 329.18subdivision 14, a municipality's taxable market value shall be adjusted to reflect the 329.19adjustments reductions to net tax capacity effected by subdivision 2, clause (a), provided 329.20that: (1) in determining the taxable market value of commercial-industrial property 329.21or any class thereof within a governmental unit for any purpose other than section 329.22473F.07 municipality, (a) the reduction required by this subdivision shall be that amount 329.23which bears the same proportion to the amount subtracted from the governmental unit's329.24 municipality's net tax capacity pursuant to subdivision 2, clause (a), as the taxable 329.25market value of commercial-industrial property, or such class thereof, located within the 329.26governmental unit municipality bears to the net tax capacity of commercial-industrial 329.27property, or such class thereof, located within the governmental unit, and (b) the increase 329.28required by this subdivision shall be that amount which bears the same proportion to 329.29the amount added to the governmental unit's net tax capacity pursuant to subdivision 2, 329.30clause (b), as the market value of commercial-industrial property, or such class thereof, 329.31located within the governmental unit bears to the net tax capacity of commercial-industrial 329.32property, or such class thereof, located within the governmental unit; and (2) in determining 329.33the market value of real property within a municipality for purposes of section 473F.07, 330.1the adjustment prescribed by clause (1)(a) hereof shall be made and that prescribed by 330.2clause (1)(b) hereof shall not be made municipality. No adjustment shall be made to 330.3taxable market value for the increase in net tax capacity under subdivision 2, clause (b).330.4    Sec. 99. Minnesota Statutes 2012, section 475.521, subdivision 4, is amended to read:330.5    Subd. 4. Limitations on amount. A municipality may not issue bonds under this 330.6section if the maximum amount of principal and interest to become due in any year on 330.7all the outstanding bonds issued under this section, including the bonds to be issued, 330.8will equal or exceed 0.16 percent of the taxable estimated market value of property 330.9in the municipality. Calculation of the limit must be made using the taxable estimated330.10 market value for the taxes payable year in which the obligations are issued and sold. In 330.11the case of a municipality with a population of 2,500 or more, the bonds are subject to 330.12the net debt limits under section 
         475.53. In the case of a shared facility in which more 330.13than one municipality participates, upon compliance by each participating municipality 330.14with the requirements of subdivision 2, the limitations in this subdivision and the net debt 330.15represented by the bonds shall be allocated to each participating municipality in proportion 330.16to its required financial contribution to the financing of the shared facility, as set forth in 330.17the joint powers agreement relating to the shared facility. This section does not limit the 330.18authority to issue bonds under any other special or general law.330.19    Sec. 100. Minnesota Statutes 2012, section 475.53, subdivision 1, is amended to read:330.20    Subdivision 1. Generally. Except as otherwise provided in sections 
         475.51 to 330.21475.74
         , no municipality, except a school district or a city of the first class, shall incur or be 330.22subject to a net debt in excess of three percent of the estimated market value of taxable 330.23property in the municipality.330.24    Sec. 101. Minnesota Statutes 2012, section 475.53, subdivision 3, is amended to read:330.25    Subd. 3. Cities first class. Unless its charter permits a greater net debt a city of 330.26the first class may not incur a net debt in excess of two percent of the estimated market 330.27value of all taxable property therein. If the charter of the city permits a net debt of the city 330.28in excess of two percent of its valuation, it may not incur a net debt in excess of 3-2/3 330.29percent of the estimated market value of the taxable property therein.330.30    The county auditor, at the time of preparing the tax list of the city, shall compile a 330.31statement setting forth the total net tax capacity and the total estimated market value of 330.32each class of taxable property in such city for such year.331.1    Sec. 102. Minnesota Statutes 2012, section 475.53, subdivision 4, is amended to read:331.2    Subd. 4. School districts. Except as otherwise provided by law, no school district 331.3shall be subject to a net debt in excess of 15 percent of the actual estimated market value of 331.4all taxable property situated within its corporate limits, as computed in accordance with this 331.5subdivision. The county auditor of each county containing taxable real or personal property 331.6situated within any school district shall certify to the district upon request the estimated 331.7market value of all such property. Whenever the commissioner of revenue, in accordance 331.8with section 
         127A.48, subdivisions 1 to 6, has determined that the net tax capacity of any 331.9district furnished by county auditors is not based upon the adjusted market value of taxable 331.10property in the district exceeds the estimated market value of property within the district, 331.11the commissioner of revenue shall certify to the district upon request the ratio most recently 331.12ascertained to exist between such the estimated market value and the actual adjusted331.13 market value of property within the district., and the actual market value of property 331.14within a district, on which its debt limit under this subdivision is will be based, is (a) the 331.15value certified by the county auditors, or (b) this on the estimated market value divided by 331.16the ratio certified by the commissioner of revenue, whichever results in a higher value.331.17    Sec. 103. Minnesota Statutes 2012, section 475.58, subdivision 2, is amended to read:331.18    Subd. 2. Funding, refunding. Any county, city, town, or school district whose 331.19outstanding gross debt, including all items referred to in section 
         475.51, subdivision 331.204
         , exceed in amount 1.62 percent of its estimated market value may issue bonds under 331.21this subdivision for the purpose of funding or refunding such indebtedness or any part 331.22thereof. A list of the items of indebtedness to be funded or refunded shall be made by the 331.23recording officer and treasurer and filed in the office of the recording officer. The initial 331.24resolution of the governing body shall refer to this subdivision as authority for the issue, 331.25state the amount of bonds to be issued and refer to the list of indebtedness to be funded or 331.26refunded. This resolution shall be published once each week for two successive weeks 331.27in a legal newspaper published in the municipality or if there be no such newspaper, in 331.28a legal newspaper published in the county seat. Such bonds may be issued without the 331.29submission of the question of their issue to the electors unless within ten days after the 331.30second publication of the resolution a petition requesting such election signed by ten or 331.31more voters who are taxpayers of the municipality, shall be filed with the recording officer. 331.32In event such petition is filed, no bonds shall be issued hereunder unless authorized by a 331.33majority of the electors voting on the question.331.34    Sec. 104. Minnesota Statutes 2012, section 475.73, subdivision 1, is amended to read:332.1    Subdivision 1. May purchase these bonds; conditions. Obligations sold under the 332.2provisions of section 
         475.60 may be purchased by the State Board of Investment if the 332.3obligations meet the requirements of section 
         11A.24, subdivision 2, upon the approval of 332.4the attorney general as to form and execution of the application therefor, and under rules 332.5as the board may specify, and the state board shall have authority to purchase the same 332.6to an amount not exceeding 
         3.63 percent of the estimated market value of the taxable 332.7property of the municipality, according to the last preceding assessment. The obligations 332.8shall not run for a shorter period than one year, nor for a longer period than 30 years and 332.9shall bear interest at a rate to be fixed by the state board but not less than two percent per 332.10annum. Forthwith upon the delivery to the state of Minnesota of any obligations issued by 332.11virtue thereof, the commissioner of management and budget shall certify to the respective 332.12auditors of the various counties wherein are situated the municipalities issuing the same, 332.13the number, denomination, amount, rate of interest and date of maturity of each obligation.332.14    Sec. 105. Minnesota Statutes 2012, section 477A.011, subdivision 20, is amended to 332.15read:332.16    Subd. 20. City net tax capacity. "City net tax capacity" means (1) the net tax 332.17capacity computed using the net tax capacity rates in section 273.13 for taxes payable 332.18in the year of the aid distribution, and the market values, after the exclusion in section 332.19273.13, subdivision 35, for taxes payable in the year prior to the aid distribution plus (2) 332.20a city's fiscal disparities distribution tax capacity under section 276A.06, subdivision 2, 332.21paragraph (b), or 473F.08, subdivision 2, paragraph (b), for taxes payable in the year prior 332.22to that for which aids are being calculated. The market value utilized in computing city 332.23net tax capacity shall be reduced by the sum of (1) a city's market value of commercial 332.24industrial property as defined in section 276A.01, subdivision 3, or 473F.02, subdivision 3, 332.25multiplied by the ratio determined pursuant to section 276A.06, subdivision 2, paragraph 332.26(a), or 473F.08, subdivision 2, paragraph (a), (2) the market value of the captured value 332.27of tax increment financing districts as defined in section 469.177, subdivision 2, and (3) 332.28the market value of transmission lines deducted from a city's total net tax capacity under 332.29section 273.425. The city net tax capacity will be computed using equalized market values332.30 the city's adjusted net tax capacity under section 273.1325.332.31EFFECTIVE DATE.This section is effective the day following final enactment.332.32    Sec. 106. Minnesota Statutes 2012, section 477A.0124, subdivision 2, is amended to 332.33read:333.1    Subd. 2. Definitions. (a) For the purposes of this section, the following terms 333.2have the meanings given them.333.3    (b) "County program aid" means the sum of "county need aid," "county tax base 333.4equalization aid," and "county transition aid."333.5    (c) "Age-adjusted population" means a county's population multiplied by the county 333.6age index.333.7    (d) "County age index" means the percentage of the population over age 65 within 333.8the county divided by the percentage of the population over age 65 within the state, except 333.9that the age index for any county may not be greater than 1.8 nor less than 0.8.333.10    (e) "Population over age 65" means the population over age 65 established as of 333.11July 15 in an aid calculation year by the most recent federal census, by a special census 333.12conducted under contract with the United States Bureau of the Census, by a population 333.13estimate made by the Metropolitan Council, or by a population estimate of the state 333.14demographer made pursuant to section 
         4A.02, whichever is the most recent as to the stated 333.15date of the count or estimate for the preceding calendar year and which has been certified 333.16to the commissioner of revenue on or before July 15 of the aid calculation year. A revision 333.17to an estimate or count is effective for these purposes only if certified to the commissioner 333.18on or before July 15 of the aid calculation year. Clerical errors in the certification or use of 333.19estimates and counts established as of July 15 in the aid calculation year are subject to 333.20correction within the time periods allowed under section 
         477A.014.333.21    (f) "Part I crimes" means the three-year average annual number of Part I crimes 333.22reported for each county by the Department of Public Safety for the most recent years 333.23available. By July 1 of each year, the commissioner of public safety shall certify to the 333.24commissioner of revenue the number of Part I crimes reported for each county for the 333.25three most recent calendar years available.333.26    (g) "Households receiving food stamps" means the average monthly number of 333.27households receiving food stamps for the three most recent years for which data is 333.28available. By July 1 of each year, the commissioner of human services must certify to the 333.29commissioner of revenue the average monthly number of households in the state and in 333.30each county that receive food stamps, for the three most recent calendar years available.333.31    (h) "County net tax capacity" means the net tax capacity of the county, computed 333.32analogously to city net tax capacity under section 477A.011, subdivision 20 county's 333.33adjusted net tax capacity under section 273.1325.333.34EFFECTIVE DATE.This section is effective the day following final enactment.333.35    Sec. 107. Minnesota Statutes 2012, section 641.23, is amended to read:334.1641.23 FUNDS; HOW PROVIDED.334.2    Before any contract is made for the erection of a county jail, sheriff's residence, or 334.3both, the county board shall either levy a sufficient tax to provide the necessary funds, or 334.4issue county bonds therefor in accordance with the provisions of chapter 475, provided 334.5that no election is required if the amount of all bonds issued for this purpose and interest 334.6on them which are due and payable in any year does not exceed an amount equal to 334.70.09671 percent of estimated market value of taxable property within the county, as last 334.8determined before the bonds are issued.334.9    Sec. 108. Minnesota Statutes 2012, section 641.24, is amended to read:334.10641.24 LEASING.334.11    The county may, by resolution of the county board, enter into a lease agreement with 334.12any statutory or home rule charter city situated within the county, or a county housing and 334.13redevelopment authority established pursuant to chapter 469 or any special law whereby 334.14the city or county housing and redevelopment authority will construct a jail or other law 334.15enforcement facilities for the county sheriff, deputy sheriffs, and other employees of the 334.16sheriff and other law enforcement agencies, in accordance with plans prepared by or at 334.17the request of the county board and, when required, approved by the commissioner of 334.18corrections and will finance it by the issuance of revenue bonds, and the county may lease 334.19the site and improvements for a term and upon rentals sufficient to produce revenue for the 334.20prompt payment of the bonds and all interest accruing thereon and, upon completion of 334.21payment, will acquire title thereto. The real and personal property acquired for the jail 334.22shall constitute a project and the lease agreement shall constitute a revenue agreement 334.23as contemplated in chapter 469, and all proceedings shall be taken by the city or county 334.24housing and redevelopment authority and the county in the manner and with the force and 334.25effect provided in chapter 469; provided that:334.26    (1) no tax shall be imposed upon or in lieu of a tax upon the property;334.27    (2) the approval of the project by the commissioner of commerce shall not be required;334.28    (3) the Department of Corrections shall be furnished and shall record such 334.29information concerning each project as it may prescribe;334.30    (4) the rentals required to be paid under the lease agreement shall not exceed in any 334.31year one-tenth of one percent of the estimated market value of property within the county, 334.32as last finally equalized before the execution of the agreement;334.33    (5) the county board shall provide for the payment of all rentals due during the term 334.34of the lease, in the manner required in section 
         641.264, subdivision 2;335.1    (6) no mortgage on the property shall be granted for the security of the bonds, but 335.2compliance with clause (5) hereof may be enforced as a nondiscretionary duty of the 335.3county board; and335.4    (7) the county board may sublease any part of the jail property for purposes consistent 335.5with the maintenance and operation of a county jail or other law enforcement facility.335.6    Sec. 109. Minnesota Statutes 2012, section 645.44, is amended by adding a subdivision 335.7to read:335.8    Subd. 20.Estimated market value.When used in determining or calculating a 335.9limit on taxation, spending, state aid amounts, or debt, bond, certificate of indebtedness, or 335.10capital note issuance by or for a local government unit, "estimated market value" has the 335.11meaning given in section 273.032.335.12    Sec. 110. REVISOR'S INSTRUCTION.335.13    The revisor of statutes shall recodify Minnesota Statutes, section 127A.48, 335.14subdivisions 1 to 6, as section 273.1325, subdivisions 1 to 6, and change all 335.15cross-references to the affected subdivisions accordingly.335.16EFFECTIVE DATE.This section is effective the day following final enactment.335.17    Sec. 111.  REPEALER.335.18Minnesota Statutes 2012, sections 276A.01, subdivision 11; 473F.02, subdivision 335.1913; and 477A.011, subdivision 21, are repealed.335.20    Sec. 112. EFFECTIVE DATE.335.21    Unless otherwise specifically provided, this article is effective the day following 335.22final enactment for purposes of limits on net debt, the issuance of bonds, certificates of 335.23indebtedness, and capital notes and is effective beginning for taxes payable in 2014 for 335.24all other purposes.335.25ARTICLE 15335.26DEPARTMENT POLICY AND TECHNICAL: INCOME AND 335.27FRANCHISE TAXES; ESTATE TAXES335.28    Section 1. Minnesota Statutes 2012, section 289A.10, is amended by adding a 335.29subdivision to read:335.30    Subd. 1a.Recapture tax return required.If a disposition or cessation as provided 335.31by section 291.03, subdivision 11, paragraph (a), has occurred, the qualified heir, as 336.1defined under section 291.03, subdivision 8, paragraph (c), or personal representative of 336.2the decedent's estate must submit a recapture tax return to the commissioner.336.3EFFECTIVE DATE.This section is effective for estates of decedents dying after 336.4June 30, 2011.336.5    Sec. 2. Minnesota Statutes 2012, section 289A.12, subdivision 14, is amended to read:336.6    Subd. 14. Regulated investment companies; reporting exempt-interest 336.7dividends. (a) A regulated investment company paying $10 or more in exempt-interest 336.8dividends to an individual who is a resident of Minnesota must make a return indicating 336.9the amount of the exempt-interest dividends, the name, address, and Social Security 336.10number of the recipient, and any other information that the commissioner specifies. The 336.11return must be provided to the shareholder by February 15 of the year following the year 336.12of the payment. The return provided to the shareholder must include a clear statement, 336.13in the form prescribed by the commissioner, that the exempt-interest dividends must be 336.14included in the computation of Minnesota taxable income. By June 1 of each year, the 336.15regulated investment company must file a copy of the return with the commissioner.336.16    (b) This subdivision applies to regulated investment companies required to register 336.17under chapter 80A.336.18    (c) (b) For purposes of this subdivision, the following definitions apply.336.19    (1) "Exempt-interest dividends" mean exempt-interest dividends as defined in 336.20section 852(b)(5) of the Internal Revenue Code, but does not include the portion of 336.21exempt-interest dividends that are not required to be added to federal taxable income 336.22under section 
         290.01, subdivision 19a, clause (1)(ii).336.23    (2) "Regulated investment company" means regulated investment company as 336.24defined in section 851(a) of the Internal Revenue Code or a fund of the regulated 336.25investment company as defined in section 851(g) of the Internal Revenue Code.336.26EFFECTIVE DATE.This section is effective the day following final enactment.336.27    Sec. 3. Minnesota Statutes 2012, section 289A.12, is amended by adding a subdivision 336.28to read:336.29    Subd. 18.Returns by qualified heirs.A qualified heir, as defined in section 291.03, 336.30subdivision 8, paragraph (c), must file two returns with the commissioner attesting that 336.31no disposition or cessation as provided by section 291.03, subdivision 11, paragraph 336.32(a), occurred. The first return must be filed no earlier than 24 months and no later than 337.126 months after the decedent's death. The second return must be filed no earlier than 36 337.2months and no later than 39 months after the decedent's death.337.3EFFECTIVE DATE.This section is effective for returns required to be filed after 337.4December 31, 2013.337.5    Sec. 4. Minnesota Statutes 2012, section 289A.18, is amended by adding a subdivision 337.6to read:337.7    Subd. 3a.Recapture tax return.A recapture tax return must be filed with the 337.8commissioner within six months after the date of the disposition or cessation as provided 337.9by section 291.03, subdivision 11, paragraph (a).337.10EFFECTIVE DATE.This section is effective for estates of decedents dying after 337.11June 30, 2011.337.12    Sec. 5. Minnesota Statutes 2012, section 289A.20, subdivision 3, is amended to read:337.13    Subd. 3. Estate tax. Taxes imposed by chapter 291 section 291.03, subdivision 1,337.14 take effect at and upon the death of the person whose estate is subject to taxation and are 337.15due and payable on or before the expiration of nine months from that death.337.16EFFECTIVE DATE.This section is effective for estates of decedents dying after 337.17June 30, 2011.337.18    Sec. 6. Minnesota Statutes 2012, section 289A.20, is amended by adding a subdivision 337.19to read:337.20    Subd. 3a.Recapture tax.The additional estate tax imposed by section 291.03, 337.21subdivision 11, paragraph (b), is due and payable on or before the expiration of the date 337.22provided by section 291.03, subdivision 11, paragraph (c).337.23EFFECTIVE DATE.This section is effective for estates of decedents dying after 337.24June 30, 2011.337.25    Sec. 7. Minnesota Statutes 2012, section 289A.26, subdivision 3, is amended to read:337.26    Subd. 3. Short taxable year. (a) A corporation or an entity with a short taxable year 337.27of less than 12 months, but at least four months, must pay estimated tax in equal installments 337.28on or before the 15th day of the third, sixth, ninth, and final month of the short taxable 337.29year, to the extent applicable based on the number of months in the short taxable year.338.1(b) A corporation or an entity is not required to make estimated tax payments for a 338.2short taxable year unless its tax liability before the first day of the last month of the taxable 338.3year can reasonably be expected to exceed $500.338.4(c) No payment is required for a short taxable year of less than four months.338.5EFFECTIVE DATE.This section is effective the day following final enactment.338.6    Sec. 8. Minnesota Statutes 2012, section 289A.26, subdivision 4, is amended to read:338.7    Subd. 4. Underpayment of estimated tax. If there is an underpayment of estimated 338.8tax by a corporation or an entity, there shall be added to the tax for the taxable year an 338.9amount determined at the rate in section 
         270C.40 on the amount of the underpayment, 338.10determined under subdivision 5, for the period of the underpayment determined under 338.11subdivision 6. This subdivision does not apply in the first taxable year that a corporation is 338.12subject to the tax imposed under section 
         290.02 or an entity is subject to the tax imposed 338.13under section 290.05, subdivision 3.338.14EFFECTIVE DATE.This section is effective the day following final enactment.338.15    Sec. 9. Minnesota Statutes 2012, section 289A.26, subdivision 7, is amended to read:338.16    Subd. 7. Required installments. (a) Except as otherwise provided in this 338.17subdivision, the amount of a required installment is 25 percent of the required annual 338.18payment.338.19(b) Except as otherwise provided in this subdivision, the term "required annual 338.20payment" means the lesser of:338.21(1) 100 percent of the tax shown on the return for the taxable year, or, if no return is 338.22filed, 100 percent of the tax for that year; or338.23(2) 100 percent of the tax shown on the return of the corporation or entity for the 338.24preceding taxable year provided the return was for a full 12-month period, showed a 338.25liability, and was filed by the corporation or entity.338.26(c) Except for determining the first required installment for any taxable year, 338.27paragraph (b), clause (2), does not apply in the case of a large corporation. The term 338.28"large corporation" means a corporation or any predecessor corporation that had taxable 338.29net income of $1,000,000 or more for any taxable year during the testing period. The 338.30term "testing period" means the three taxable years immediately preceding the taxable 338.31year involved. A reduction allowed to a large corporation for the first installment that is 338.32allowed by applying paragraph (b), clause (2), must be recaptured by increasing the next 338.33required installment by the amount of the reduction.339.1(d) In the case of a required installment, if the corporation or entity establishes that 339.2the annualized income installment is less than the amount determined in paragraph (a), the 339.3amount of the required installment is the annualized income installment and the recapture 339.4of previous quarters' reductions allowed by this paragraph must be recovered by increasing 339.5later required installments to the extent the reductions have not previously been recovered.339.6(e) The "annualized income installment" is the excess, if any, of:339.7(1) an amount equal to the applicable percentage of the tax for the taxable year 339.8computed by placing on an annualized basis the taxable income:339.9(i) for the first two months of the taxable year, in the case of the first required 339.10installment;339.11(ii) for the first two months or for the first five months of the taxable year, in the 339.12case of the second required installment;339.13(iii) for the first six months or for the first eight months of the taxable year, in the 339.14case of the third required installment; and339.15(iv) for the first nine months or for the first 11 months of the taxable year, in the 339.16case of the fourth required installment, over339.17(2) the aggregate amount of any prior required installments for the taxable year.339.18(3) For the purpose of this paragraph, the annualized income shall be computed 339.19by placing on an annualized basis the taxable income for the year up to the end of the 339.20month preceding the due date for the quarterly payment multiplied by 12 and dividing 339.21the resulting amount by the number of months in the taxable year (2, 5, 6, 8, 9, or 11 as 339.22the case may be) referred to in clause (1).339.23(4) The "applicable percentage" used in clause (1) is:

339.24339.25339.26For the following 
                  		required 
                  		installments:The applicable
                  		percentage is:339.271st25339.282nd50339.293rd75339.304th100

339.31(f)(1) If this paragraph applies, the amount determined for any installment must 339.32be determined in the following manner:339.33(i) take the taxable income for the months during the taxable year preceding the 339.34filing month;339.35(ii) divide that amount by the base period percentage for the months during the 339.36taxable year preceding the filing month;339.37(iii) determine the tax on the amount determined under item (ii); and340.1(iv) multiply the tax computed under item (iii) by the base period percentage for the 340.2filing month and the months during the taxable year preceding the filing month.340.3(2) For purposes of this paragraph:340.4(i) the "base period percentage" for a period of months is the average percent that the 340.5taxable income for the corresponding months in each of the three preceding taxable years 340.6bears to the taxable income for the three preceding taxable years;340.7(ii) the term "filing month" means the month in which the installment is required 340.8to be paid;340.9(iii) this paragraph only applies if the base period percentage for any six consecutive 340.10months of the taxable year equals or exceeds 70 percent; and340.11(iv) the commissioner may provide by rule for the determination of the base period 340.12percentage in the case of reorganizations, new corporations or entities, and other similar 340.13circumstances.340.14(3) In the case of a required installment determined under this paragraph, if the340.15 corporation or entity determines that the installment is less than the amount determined in 340.16paragraph (a), the amount of the required installment is the amount determined under this 340.17paragraph and the recapture of previous quarters' reductions allowed by this paragraph 340.18must be recovered by increasing later required installments to the extent the reductions 340.19have not previously been recovered.340.20EFFECTIVE DATE.This section is effective the day following final enactment.340.21    Sec. 10. Minnesota Statutes 2012, section 289A.26, subdivision 9, is amended to read:340.22    Subd. 9. Failure to file an estimate. In the case of a corporation or an entity 340.23that fails to file an estimated tax for a taxable year when one is required, the period of 340.24the underpayment runs from the four installment dates in subdivision 2 or 3, whichever 340.25applies, to the earlier of the periods in subdivision 6, clauses (1) and (2).340.26EFFECTIVE DATE.This section is effective the day following final enactment.340.27    Sec. 11. Minnesota Statutes 2012, section 290.9705, subdivision 1, is amended to read:340.28    Subdivision 1. Withholding of payments to out-of-state contractors. (a) In this 340.29section, "person" means a person, corporation, or cooperative, the state of Minnesota and 340.30its political subdivisions, and a city, county, and school district in Minnesota.340.31(b) A person who in the regular course of business is hiring, contracting, or having a 340.32contract with a nonresident person or foreign corporation, as defined in Minnesota Statutes 340.331986, section 290.01, subdivision 5, to perform construction work in Minnesota, shall 341.1deduct and withhold eight percent of cumulative calendar year payments made to the 341.2contractor which exceed if the value of the contract exceeds $50,000.341.3EFFECTIVE DATE.This section is effective for payments made to contractors 341.4after December 31, 2013.341.5ARTICLE 16341.6DEPARTMENT POLICY AND TECHNICAL: SALES AND USE 341.7TAXES; SPECIAL TAXES341.8    Section 1. Minnesota Statutes 2012, section 287.20, is amended by adding a 341.9subdivision to read:341.10    Subd. 11.Partition."Partition" means the division by conveyance of real property 341.11that is held jointly or in common by two or more persons into individually owned interests. 341.12If one of the co-owners gives consideration for all or a part of the individually owned 341.13interest conveyed to them, that portion of the conveyance is not a part of the partition.341.14EFFECTIVE DATE.This section is effective the day following final enactment.341.15    Sec. 2. Minnesota Statutes 2012, section 289A.20, subdivision 4, is amended to read:341.16    Subd. 4. Sales and use tax. (a) The taxes imposed by chapter 297A are due and 341.17payable to the commissioner monthly on or before the 20th day of the month following 341.18the month in which the taxable event occurred, or following another reporting period 341.19as the commissioner prescribes or as allowed under section 
         289A.18, subdivision 4, 341.20paragraph (f) or (g), except that:341.21(1) use taxes due on an annual use tax return as provided under section 
         289A.11, 341.22subdivision 1
         , are payable by April 15 following the close of the calendar year; and.341.23(2) except as provided in paragraph (f), for a vendor having a liability of $120,000 341.24or more during a fiscal year ending June 30, 2009, and fiscal years thereafter, the taxes 341.25imposed by chapter 297A, except as provided in paragraph (b), are due and payable to the 341.26commissioner monthly in the following manner:341.27(i) On or before the 14th day of the month following the month in which the taxable 341.28event occurred, the vendor must remit to the commissioner 90 percent of the estimated 341.29liability for the month in which the taxable event occurred.341.30(ii) On or before the 20th day of the month in which the taxable event occurs, the 341.31vendor must remit to the commissioner a prepayment for the month in which the taxable 341.32event occurs equal to 67 percent of the liability for the previous month.341.33(iii) On or before the 20th day of the month following the month in which the taxable 341.34event occurred, the vendor must pay any additional amount of tax not previously remitted 342.1under either item (i) or (ii ) or, if the payment made under item (i) or (ii) was greater than 342.2the vendor's liability for the month in which the taxable event occurred, the vendor may 342.3take a credit against the next month's liability in a manner prescribed by the commissioner.342.4(iv) Once the vendor first pays under either item (i) or (ii), the vendor is required to 342.5continue to make payments in the same manner, as long as the vendor continues having a 342.6liability of $120,000 or more during the most recent fiscal year ending June 30.342.7(v) Notwithstanding items (i), (ii), and (iv), if a vendor fails to make the required 342.8payment in the first month that the vendor is required to make a payment under either item 342.9(i) or (ii), then the vendor is deemed to have elected to pay under item (ii) and must make 342.10subsequent monthly payments in the manner provided in item (ii).342.11(vi) For vendors making an accelerated payment under item (ii), for the first month 342.12that the vendor is required to make the accelerated payment, on the 20th of that month, the 342.13vendor will pay 100 percent of the liability for the previous month and a prepayment for 342.14the first month equal to 67 percent of the liability for the previous month.342.15    (b) Notwithstanding paragraph (a), A vendor having a liability of $120,000 or more 342.16during a fiscal year ending June 30 must remit the June liability for the next year in the 342.17following manner:342.18    (1) Two business days before June 30 of the year, the vendor must remit 90 percent 342.19of the estimated June liability to the commissioner.342.20    (2) On or before August 20 of the year, the vendor must pay any additional amount 342.21of tax not remitted in June.342.22    (c) A vendor having a liability of:342.23    (1) $10,000 or more, but less than $120,000 during a fiscal year ending June 30, 342.242009, and fiscal years thereafter, must remit by electronic means all liabilities on returns 342.25due for periods beginning in the subsequent calendar year on or before the 20th day of 342.26the month following the month in which the taxable event occurred, or on or before the 342.2720th day of the month following the month in which the sale is reported under section 342.28289A.18, subdivision 4
         ; or342.29(2) $120,000 or more, during a fiscal year ending June 30, 2009, and fiscal years 342.30thereafter, must remit by electronic means all liabilities in the manner provided in 342.31paragraph (a), clause (2), on returns due for periods beginning in the subsequent calendar 342.32year, except for 90 percent of the estimated June liability, which is due two business days 342.33before June 30. The remaining amount of the June liability is due on August 20.342.34(d) Notwithstanding paragraph (b) or (c), a person prohibited by the person's 342.35religious beliefs from paying electronically shall be allowed to remit the payment by mail. 342.36The filer must notify the commissioner of revenue of the intent to pay by mail before 343.1doing so on a form prescribed by the commissioner. No extra fee may be charged to a 343.2person making payment by mail under this paragraph. The payment must be postmarked 343.3at least two business days before the due date for making the payment in order to be 343.4considered paid on a timely basis.343.5(e) Whenever the liability is $120,000 or more separately for: (1) the tax imposed 343.6under chapter 297A; (2) a fee that is to be reported on the same return as and paid with the 343.7chapter 297A taxes; or (3) any other tax that is to be reported on the same return as and 343.8paid with the chapter 297A taxes, then the payment of all the liabilities on the return must 343.9be accelerated as provided in this subdivision.343.10(f) At the start of the first calendar quarter at least 90 days after the cash flow account 343.11established in section 16A.152, subdivision 1, and the budget reserve account established in 343.12section 16A.152, subdivision 1a, reach the amounts listed in section 16A.152, subdivision 343.132, paragraph (a), the remittance of the accelerated payments required under paragraph (a), 343.14clause (2), must be suspended. The commissioner of management and budget shall notify 343.15the commissioner of revenue when the accounts have reached the required amounts. 343.16Beginning with the suspension of paragraph (a), clause (2), for a vendor with a liability of 343.17$120,000 or more during a fiscal year ending June 30, 2009, and fiscal years thereafter, the 343.18taxes imposed by chapter 297A are due and payable to the commissioner on the 20th day 343.19of the month following the month in which the taxable event occurred. Payments of tax 343.20liabilities for taxable events occurring in June under paragraph (b) are not changed.343.21EFFECTIVE DATE.This section is effective the day following final enactment.343.22    Sec. 3. Minnesota Statutes 2012, section 297A.665, is amended to read:343.23297A.665 PRESUMPTION OF TAX; BURDEN OF PROOF.343.24    (a) For the purpose of the proper administration of this chapter and to prevent 343.25evasion of the tax, until the contrary is established, it is presumed that:343.26    (1) all gross receipts are subject to the tax; and343.27    (2) all retail sales for delivery in Minnesota are for storage, use, or other consumption 343.28in Minnesota.343.29    (b) The burden of proving that a sale is not a taxable retail sale is on the seller. 343.30However, a seller is relieved of liability if:343.31    (1) the seller obtains a fully completed exemption certificate or all the relevant 343.32information required by section 
         297A.72, subdivision 2, at the time of the sale or within 343.3390 days after the date of the sale; or344.1    (2) if the seller has not obtained a fully completed exemption certificate or all the 344.2relevant information required by section 
         297A.72, subdivision 2, within the time provided 344.3in clause (1), within 120 days after a request for substantiation by the commissioner, 344.4the seller either:344.5    (i) obtains in good faith from the purchaser a fully completed exemption certificate 344.6or all the relevant information required by section 
         297A.72, subdivision 2, from the 344.7purchaser taken in good faith which means that the exemption certificate claims an 344.8exemption that (A) was statutorily available on the date of the transaction, (B) could be 344.9applicable to the item for which the exemption is claimed, and (C) is reasonable for the 344.10purchaser's type of business; or344.11    (ii) proves by other means that the transaction was not subject to tax.344.12    (c) Notwithstanding paragraph (b), relief from liability does not apply to a seller who:344.13    (1) fraudulently fails to collect the tax; or344.14    (2) solicits purchasers to participate in the unlawful claim of an exemption.344.15(d) Notwithstanding paragraph (b), relief from liability does not apply to a seller 344.16who has obtained information under paragraph (b), clause (2), if through the audit process 344.17the commissioner finds the following:344.18(1) that at the time the information was provided the seller had knowledge or had 344.19reason to know that the information relating to the exemption was materially false; or344.20(2) that the seller knowingly participated in activity intended to purposefully evade 344.21the sales tax due on the transaction.344.22    (d) (e) A certified service provider, as defined in section 
         297A.995, subdivision 2, is 344.23relieved of liability under this section to the extent a seller who is its client is relieved of 344.24liability.344.25    (e) (f) A purchaser of tangible personal property or any items listed in section 
         297A.63 344.26that are shipped or brought to Minnesota by the purchaser has the burden of proving that the 344.27property was not purchased from a retailer for storage, use, or consumption in Minnesota.344.28(f) (g) If a seller claims that certain sales are exempt and does not provide the 344.29certificate, information, or proof required by paragraph (b), clause (2), within 120 days 344.30after the date of the commissioner's request for substantiation, then the exemptions 344.31claimed by the seller that required substantiation are disallowed.344.32EFFECTIVE DATE.This section is effective retroactively from January 1, 2013.344.33    Sec. 4. Minnesota Statutes 2012, section 297F.01, subdivision 23, is amended to read:344.34    Subd. 23. Wholesale sales price. "Wholesale sales price" means the price stated 344.35on the price list in effect at the time of sale for which a manufacturer or person sells a 345.1tobacco product to a distributor, exclusive of any discount, promotional offer, or other 345.2reduction. For purposes of this subdivision, "price list" means the manufacturer's price at 345.3which tobacco products are made available for sale to all distributors on an ongoing basis345.4 at which a distributor purchases a tobacco product. Wholesale sales price includes the 345.5applicable federal excise tax, freight charges, or packaging costs, regardless of whether 345.6they were included in the purchase price.345.7EFFECTIVE DATE.This section is effective for purchases made after December 345.831, 2013.345.9    Sec. 5. Minnesota Statutes 2012, section 297G.04, subdivision 2, is amended to read:345.10    Subd. 2. Tax credit. A qualified brewer producing fermented malt beverages 345.11is entitled to a tax credit of $4.60 per barrel on 25,000 barrels sold in any fiscal year 345.12beginning July 1, regardless of the alcohol content of the product. Qualified brewers may 345.13take the credit on the 18th day of each month, but the total credit allowed may not exceed 345.14in any fiscal year the lesser of:345.15(1) the liability for tax; or345.16(2) $115,000.345.17For purposes of this subdivision, a "qualified brewer" means a brewer, whether 345.18or not located in this state, manufacturing less than 100,000 barrels of fermented malt 345.19beverages in the calendar year immediately preceding the calendar fiscal year for which 345.20the credit under this subdivision is claimed. In determining the number of barrels, all 345.21brands or labels of a brewer must be combined. All facilities for the manufacture of 345.22fermented malt beverages owned or controlled by the same person, corporation, or other 345.23entity must be treated as a single brewer.345.24EFFECTIVE DATE.This section is effective the day following final enactment.345.25    Sec. 6. Minnesota Statutes 2012, section 297I.05, subdivision 7, is amended to read:345.26    Subd. 7. Nonadmitted insurance premium tax. (a) A tax is imposed on surplus 345.27lines brokers. The rate of tax is equal to three percent of the gross premiums less return 345.28premiums paid by an insured whose home state is Minnesota.345.29(b) A tax is imposed on persons, firms, or corporations a person, firm, corporation, 345.30or purchasing group as defined in section 60E.02, or any member of a purchasing group,345.31 that procure procures insurance directly from a nonadmitted insurer. The rate of tax is 345.32equal to two percent of the gross premiums less return premiums paid by an insured 345.33whose home state is Minnesota.346.1(c) No state other than the home state of an insured may require any premium tax 346.2payment for nonadmitted insurance. When Minnesota is the home state of the insured, 346.3as provided under section 
         297I.01, 100 percent of the gross premiums are taxable in 346.4Minnesota with no allocation of the tax to other states.346.5EFFECTIVE DATE.This section is effective for premiums received after 346.6December 31, 2013.346.7    Sec. 7. Minnesota Statutes 2012, section 297I.05, subdivision 11, is amended to read:346.8    Subd. 11. Retaliatory provisions. (a) If any other state or country imposes any 346.9taxes, fines, deposits, penalties, licenses, or fees upon any insurance companies of this 346.10state and their agents doing business in another state or country that are in addition to or in 346.11excess of those imposed by the laws of this state upon foreign insurance companies and 346.12their agents doing business in this state, the same taxes, fines, deposits, penalties, licenses, 346.13and fees are imposed upon every similar insurance company of that state or country and 346.14their agents doing or applying to do business in this state.346.15(b) If any conditions precedent to the right to do business in any other state or 346.16country are imposed by the laws of that state or country, beyond those imposed upon 346.17foreign companies by the laws of this state, the same conditions precedent are imposed 346.18upon every similar insurance company of that state or country and their agents doing or 346.19applying to do business in that state.346.20(c) For purposes of this subdivision, "taxes, fines, deposits, penalties, licenses, or 346.21fees" means an amount of money that is deposited in the general revenue fund of the state 346.22or other similar fund in another state or country and is not dedicated to a special purpose 346.23or use or money deposited in the general revenue fund of the state or other similar fund in 346.24another state or country and appropriated to the commissioner of commerce or insurance 346.25for the operation of the Department of Commerce or other similar agency with jurisdiction 346.26over insurance. Taxes, fines, deposits, penalties, licenses, or fees do not include:346.27(1) special purpose obligations or assessments imposed in connection with particular 346.28kinds of insurance, including but not limited to assessments imposed in connection with 346.29residual market mechanisms; or346.30(2) assessments made by the insurance guaranty association, life and health 346.31guarantee association, or similar association.346.32(d) This subdivision applies to taxes imposed under subdivisions 1,; 3,; 4, 6, and; 12, 346.33paragraph (a), clauses (1) and (2); and 14.346.34(e) This subdivision does not apply to insurance companies organized or domiciled 346.35in a state or country, the laws of which do not impose retaliatory taxes, fines, deposits, 347.1penalties, licenses, or fees or which grant, on a reciprocal basis, exemptions from 347.2retaliatory taxes, fines, deposits, penalties, licenses, or fees to insurance companies 347.3domiciled in this state.347.4EFFECTIVE DATE.This section is effective the day following final enactment.347.5    Sec. 8. Minnesota Statutes 2012, section 297I.05, subdivision 12, is amended to read:347.6    Subd. 12. Other entities. (a) A tax is imposed equal to two percent of:347.7    (1) gross premiums less return premiums written for risks resident or located in 347.8Minnesota by a risk retention group;347.9    (2) gross premiums less return premiums received by an attorney in fact acting 347.10in accordance with chapter 71A;347.11    (3) gross premiums less return premiums received pursuant to assigned risk policies 347.12and contracts of coverage under chapter 79; and347.13    (4) the direct funded premium received by the reinsurance association under section 347.1479.34
          from self-insurers approved under section 
         176.181 and political subdivisions that 347.15self-insure; and.347.16    (5) gross premiums less return premiums paid to an insurer other than a licensed 347.17insurance company or a surplus lines broker for coverage of risks resident or located in 347.18Minnesota by a purchasing group or any members of the purchasing group to a broker or 347.19agent for the purchasing group.347.20    (b) A tax is imposed on a joint self-insurance plan operating under chapter 60F. The 347.21rate of tax is equal to two percent of the total amount of claims paid during the fund year, 347.22with no deduction for claims wholly or partially reimbursed through stop-loss insurance.347.23    (c) A tax is imposed on a joint self-insurance plan operating under chapter 62H. 347.24The rate of tax is equal to two percent of the total amount of claims paid during the 347.25fund's fiscal year, with no deduction for claims wholly or partially reimbursed through 347.26stop-loss insurance.347.27    (d) A tax is imposed equal to the tax imposed under section 
         297I.05, subdivision 5, 347.28on the gross premiums less return premiums on all coverages received by an accountable 347.29provider network or agents of an accountable provider network in Minnesota, in cash or 347.30otherwise, during the year.347.31EFFECTIVE DATE.This section is effective for premiums received after 347.32December 31, 2013.347.33    Sec. 9. Minnesota Statutes 2012, section 297I.30, subdivision 1, is amended to read:348.1    Subdivision 1. General rule. On or before March 1, every taxpayer subject to 348.2taxation under section 
         297I.05, subdivisions 1 to 5,; 7, paragraph (b),; 12, paragraphs (a), 348.3clauses (1) to (4), (b), (c), and (d),; and 14, shall file an annual return for the preceding 348.4calendar year in the form prescribed by the commissioner.348.5EFFECTIVE DATE.This section is effective for premiums received after 348.6December 31, 2013.348.7    Sec. 10. Minnesota Statutes 2012, section 297I.30, subdivision 2, is amended to read:348.8    Subd. 2. Surplus lines brokers and purchasing groups. On or before February 348.915 and August 15 of each year, every surplus lines broker subject to taxation under 348.10section 
         297I.05, subdivision 7, paragraph (a), and every purchasing group or member of 348.11a purchasing group subject to tax under section 297I.05, subdivision 12, paragraph (a), 348.12clause (5), shall file a return with the commissioner for the preceding six-month period 348.13ending December 31, or June 30, in the form prescribed by the commissioner.348.14EFFECTIVE DATE.This section is effective for premiums received after 348.15December 31, 2013.348.16    Sec. 11.  REPEALER.348.17Minnesota Statutes 2012, section 289A.60, subdivision 31, is repealed.348.18EFFECTIVE DATE.This section is effective the day following final enactment.348.19ARTICLE 17348.20DEPARTMENT POLICY AND TECHNICAL: MINERALS 348.21TAXES; PROPERTY TAX348.22    Section 1. Minnesota Statutes 2012, section 123A.455, subdivision 1, is amended to 348.23read:348.24    Subdivision 1. Definitions. "Split residential property parcel" means a parcel of 348.25real estate that is located within the boundaries of more than one school district and that 348.26is classified as residential property under:348.27    (1) section 
         273.13, subdivision 22, paragraph (a) or (b);348.28    (2) section 
         273.13, subdivision 25, paragraph (b), clause (1); or348.29    (3) section 
         273.13, subdivision 25, paragraph (c), clause (1).348.30EFFECTIVE DATE.This section is effective for taxes payable in 2014 and 348.31thereafter.349.1    Sec. 2. Minnesota Statutes 2012, section 270.077, is amended to read:349.2270.077 TAXES CREDITED TO STATE AIRPORTS FUND.349.3    All taxes levied under sections 
         270.071 to 
         270.079 must be collected by the 349.4commissioner and credited to the state airports fund created in section 
         360.017.349.5EFFECTIVE DATE.This section is effective the day following final enactment.349.6    Sec. 3. Minnesota Statutes 2012, section 270.41, subdivision 5, is amended to read:349.7    Subd. 5. Prohibited activity. A licensed assessor or other person employed by an 349.8assessment jurisdiction or contracting with an assessment jurisdiction for the purpose 349.9of valuing or classifying property for property tax purposes is prohibited from making 349.10appraisals or analyses, accepting an appraisal assignment, or preparing an appraisal report 349.11as defined in section 
         82B.021, subdivisions 2, 4, 6, and 7, on any property within the 349.12assessment jurisdiction where the individual is employed or performing the duties of the 349.13assessor under contract. Violation of this prohibition shall result in immediate revocation 349.14of the individual's license to assess property for property tax purposes. This prohibition 349.15must not be construed to prohibit an individual from carrying out any duties required 349.16for the proper assessment of property for property tax purposes or performing duties 349.17enumerated in section 
         273.061, subdivision 7 or 8. If a formal resolution has been adopted 349.18by the governing body of a governmental unit, which specifies the purposes for which 349.19such work will be done, this prohibition does not apply to appraisal activities undertaken 349.20on behalf of and at the request of the governmental unit that has employed or contracted 349.21with the individual. The resolution may only allow appraisal activities which are related to 349.22condemnations, right-of-way acquisitions, land exchanges, or special assessments.349.23EFFECTIVE DATE.This section is effective the day following final enactment.349.24    Sec. 4. Minnesota Statutes 2012, section 270C.34, subdivision 1, is amended to read:349.25    Subdivision 1. Authority. (a) The commissioner may abate, reduce, or refund any 349.26penalty or interest that is imposed by a law administered by the commissioner, or imposed 349.27by section 
         270.0725, subdivision 1 or 2, or 270.075, subdivision 2, as a result of the late 349.28payment of tax or late filing of a return, or any part of an additional tax charge under 349.29section 
         289A.25, subdivision 2, or 
         289A.26, subdivision 4, if the failure to timely pay the 349.30tax or failure to timely file the return is due to reasonable cause, or if the taxpayer is located 349.31in a presidentially declared disaster or in a presidentially declared state of emergency area 349.32or in an area declared to be in a state of emergency by the governor under section 
         12.31.350.1    (b) The commissioner shall abate any part of a penalty or additional tax charge 350.2under section 
         289A.25, subdivision 2, or 
         289A.26, subdivision 4, attributable to erroneous 350.3advice given to the taxpayer in writing by an employee of the department acting in 350.4an official capacity, if the advice:350.5    (1) was reasonably relied on and was in response to a specific written request of the 350.6taxpayer; and350.7    (2) was not the result of failure by the taxpayer to provide adequate or accurate 350.8information.350.9EFFECTIVE DATE.This section is effective the day following final enactment.350.10    Sec. 5. Minnesota Statutes 2012, section 272.01, subdivision 2, is amended to read:350.11    Subd. 2. Exempt property used by private entity for profit. (a) When any real or 350.12personal property which is exempt from ad valorem taxes, and taxes in lieu thereof, is 350.13leased, loaned, or otherwise made available and used by a private individual, association, 350.14or corporation in connection with a business conducted for profit, there shall be imposed a 350.15tax, for the privilege of so using or possessing such real or personal property, in the same 350.16amount and to the same extent as though the lessee or user was the owner of such property.350.17    (b) The tax imposed by this subdivision shall not apply to:350.18    (1) property leased or used as a concession in or relative to the use in whole 350.19or part of a public park, market, fairgrounds, port authority, economic development 350.20authority established under chapter 469, municipal auditorium, municipal parking facility, 350.21municipal museum, or municipal stadium;350.22    (2) property of an airport owned by a city, town, county, or group thereof which is:350.23    (i) leased to or used by any person or entity including a fixed base operator; and350.24    (ii) used as a hangar for the storage or repair of aircraft or to provide aviation goods, 350.25services, or facilities to the airport or general public;350.26the exception from taxation provided in this clause does not apply to:350.27    (i) property located at an airport owned or operated by the Metropolitan Airports 350.28Commission or by a city of over 50,000 population according to the most recent federal 350.29census or such a city's airport authority; or350.30    (ii) hangars leased by a private individual, association, or corporation in connection 350.31with a business conducted for profit other than an aviation-related business;350.32    (3) property constituting or used as a public pedestrian ramp or concourse in 350.33connection with a public airport;350.34    (4) property constituting or used as a passenger check-in area or ticket sale counter, 350.35boarding area, or luggage claim area in connection with a public airport but not the 351.1airports owned or operated by the Metropolitan Airports Commission or cities of over 351.250,000 population or an airport authority therein. Real estate owned by a municipality 351.3in connection with the operation of a public airport and leased or used for agricultural 351.4purposes is not exempt;351.5    (5) property leased, loaned, or otherwise made available to a private individual, 351.6corporation, or association under a cooperative farming agreement made pursuant to 351.7section 
         97A.135; or351.8    (6) property leased, loaned, or otherwise made available to a private individual, 351.9corporation, or association under section 
         272.68, subdivision 4.351.10    (c) Taxes imposed by this subdivision are payable as in the case of personal property 351.11taxes and shall be assessed to the lessees or users of real or personal property in the same 351.12manner as taxes assessed to owners of real or personal property, except that such taxes 351.13shall not become a lien against the property. When due, the taxes shall constitute a debt due 351.14from the lessee or user to the state, township, city, county, and school district for which the 351.15taxes were assessed and shall be collected in the same manner as personal property taxes. 351.16If property subject to the tax imposed by this subdivision is leased or used jointly by two or 351.17more persons, each lessee or user shall be jointly and severally liable for payment of the tax.351.18    (d) The tax on real property of the federal government, the state or any of its political 351.19subdivisions that is leased by, loaned, or otherwise made available to a private individual, 351.20association, or corporation and becomes taxable under this subdivision or other provision 351.21of law must be assessed and collected as a personal property assessment. The taxes do 351.22not become a lien against the real property.351.23EFFECTIVE DATE.This section is effective the day following final enactment.351.24    Sec. 6. Minnesota Statutes 2012, section 272.02, subdivision 97, is amended to read:351.25    Subd. 97. Property used in business of mining subject to net proceeds tax. The 351.26following property used in the business of mining that is subject to the net proceeds tax 351.27under section 
         298.015 is exempt:351.28    (1) deposits of ores, metals, and minerals and the lands in which they are contained;351.29    (2) all real and personal property used in mining, quarrying, producing, or refining 351.30ores, minerals, or metals, including lands occupied by or used in connection with the 351.31mining, quarrying, production, or ore refining facilities; and351.32    (3) concentrate or direct reduced ore.351.33    This exemption applies for each year that a person subject to tax under section 351.34298.015
          uses the property for mining, quarrying, producing, or refining ores, metals, or 351.35minerals.352.1EFFECTIVE DATE.This section is effective the day following final enactment.352.2    Sec. 7. Minnesota Statutes 2012, section 272.03, subdivision 9, is amended to read:352.3    Subd. 9. Person. "Person" includes means an individual, association, estate, trust, 352.4partnership, firm, company, or corporation.352.5EFFECTIVE DATE.This section is effective the day following final enactment.352.6    Sec. 8. Minnesota Statutes 2012, section 273.114, subdivision 6, is amended to read:352.7    Subd. 6. Additional taxes.(a) When real property which is being, or has been 352.8valued and assessed under this section is sold, transferred, or no longer qualifies under 352.9subdivision 2, the portion sold, transferred, or no longer qualifying shall be subject to 352.10additional taxes in the amount equal to the difference between the taxes determined in 352.11accordance with subdivision 3 and the amount determined under subdivision 4, provided 352.12that the amount determined under subdivision 4 shall not be greater than it would have 352.13been had the actual bona fide sale price of the real property at an arm's-length transaction 352.14been used in lieu of the market value determined under subdivision 4. The additional taxes 352.15shall be extended against the property on the tax list for taxes payable in the current year, 352.16provided that no interest or penalties shall be levied on the additional taxes if timely paid 352.17and provided that the additional taxes shall only be levied with respect to the current year 352.18plus two prior years that the property has been valued and assessed under this section.352.19    (b) In the case of a sale or transfer, the additional taxes under paragraph (a) shall not 352.20be extended against the property if the new owner submits a successful application under 352.21this section by the later of May 1 of the current year or 30 days after the sale or transfer.352.22    (c) For the purposes of this section, the following events do not constitute a sale or 352.23transfer for property that qualified under subdivision 2 prior to the event:352.24    (1) death of a property owner when the surviving owners retain ownership of the 352.25property;352.26    (2) divorce of a married couple when one of the spouses retains ownership of the 352.27property;352.28    (3) marriage of a single property owner when that owner retains ownership of the 352.29property in whole or in part;352.30    (4) the organization or reorganization of a farm ownership entity that is not prohibited 352.31from owning agricultural land in this state under section 500.24, if all owners maintain the 352.32same beneficial interest both before and after the organization or reorganization; and353.1    (5) transfer of the property to a trust or trustee, provided that the individual owners 353.2of the property are the grantors of the trust and they maintain the same beneficial interest 353.3both before and after placement of the property in trust.353.4EFFECTIVE DATE.This section is effective the day following final enactment.353.5    Sec. 9. Minnesota Statutes 2012, section 273.13, subdivision 23, is amended to read:353.6    Subd. 23. Class 2. (a) An agricultural homestead consists of class 2a agricultural 353.7land that is homesteaded, along with any class 2b rural vacant land that is contiguous to 353.8the class 2a land under the same ownership. The market value of the house and garage 353.9and immediately surrounding one acre of land has the same class rates as class 1a or 1b 353.10property under subdivision 22. The value of the remaining land including improvements 353.11up to the first tier valuation limit of agricultural homestead property has a net class rate 353.12of 0.5 percent of market value. The remaining property over the first tier has a class rate 353.13of one percent of market value. For purposes of this subdivision, the "first tier valuation 353.14limit of agricultural homestead property" and "first tier" means the limit certified under 353.15section 
         273.11, subdivision 23.353.16    (b) Class 2a agricultural land consists of parcels of property, or portions thereof, that 353.17are agricultural land and buildings. Class 2a property has a net class rate of one percent of 353.18market value, unless it is part of an agricultural homestead under paragraph (a). Class 2a 353.19property must also include any property that would otherwise be classified as 2b, but is 353.20interspersed with class 2a property, including but not limited to sloughs, wooded wind 353.21shelters, acreage abutting ditches, ravines, rock piles, land subject to a setback requirement, 353.22and other similar land that is impractical for the assessor to value separately from the rest of 353.23the property or that is unlikely to be able to be sold separately from the rest of the property.353.24    An assessor may classify the part of a parcel described in this subdivision that is used 353.25for agricultural purposes as class 2a and the remainder in the class appropriate to its use.353.26    (c) Class 2b rural vacant land consists of parcels of property, or portions thereof, 353.27that are unplatted real estate, rural in character and not used for agricultural purposes, 353.28including land used for growing trees for timber, lumber, and wood and wood products, 353.29that is not improved with a structure. The presence of a minor, ancillary nonresidential 353.30structure as defined by the commissioner of revenue does not disqualify the property from 353.31classification under this paragraph. Any parcel of 20 acres or more improved with a 353.32structure that is not a minor, ancillary nonresidential structure must be split-classified, and 353.33ten acres must be assigned to the split parcel containing the structure. Class 2b property 353.34has a net class rate of one percent of market value unless it is part of an agricultural 353.35homestead under paragraph (a), or qualifies as class 2c under paragraph (d).354.1    (d) Class 2c managed forest land consists of no less than 20 and no more than 1,920 354.2acres statewide per taxpayer that is being managed under a forest management plan that 354.3meets the requirements of chapter 290C, but is not enrolled in the sustainable forest 354.4resource management incentive program. It has a class rate of .65 percent, provided that 354.5the owner of the property must apply to the assessor in order for the property to initially 354.6qualify for the reduced rate and provide the information required by the assessor to verify 354.7that the property qualifies for the reduced rate. If the assessor receives the application 354.8and information before May 1 in an assessment year, the property qualifies beginning 354.9with that assessment year. If the assessor receives the application and information after 354.10April 30 in an assessment year, the property may not qualify until the next assessment 354.11year. The commissioner of natural resources must concur that the land is qualified. The 354.12commissioner of natural resources shall annually provide county assessors verification 354.13information on a timely basis. The presence of a minor, ancillary nonresidential structure 354.14as defined by the commissioner of revenue does not disqualify the property from 354.15classification under this paragraph.354.16    (e) Agricultural land as used in this section means:354.17    (1) contiguous acreage of ten acres or more, used during the preceding year for 354.18agricultural purposes.; or354.19    (2) contiguous acreage used during the preceding year for an intensive livestock or 354.20poultry confinement operation, provided that land used only for pasturing or grazing 354.21does not qualify under this clause.354.22    "Agricultural purposes" as used in this section means the raising, cultivation, drying, 354.23or storage of agricultural products for sale, or the storage of machinery or equipment 354.24used in support of agricultural production by the same farm entity. For a property to be 354.25classified as agricultural based only on the drying or storage of agricultural products, 354.26the products being dried or stored must have been produced by the same farm entity as 354.27the entity operating the drying or storage facility. "Agricultural purposes" also includes 354.28enrollment in the Reinvest in Minnesota program under sections 
         103F.501 to 
         103F.535 or 354.29the federal Conservation Reserve Program as contained in Public Law 99-198 or a similar 354.30state or federal conservation program if the property was classified as agricultural (i) 354.31under this subdivision for the assessment year 2002 taxes payable in 2003 because of its 354.32enrollment in a qualifying program and the land remains enrolled or (ii) in the year prior 354.33to its enrollment. Agricultural classification shall not be based upon the market value of 354.34any residential structures on the parcel or contiguous parcels under the same ownership.355.1    "Contiguous acreage," for purposes of this paragraph, means all of, or a contiguous 355.2portion of, a tax parcel as described in section 272.193, or all of, or a contiguous portion 355.3of, a set of contiguous tax parcels under that section that are owned by the same person.355.4    (f) Real estate of Agricultural land under this section also includes:355.5    (1) contiguous acreage that is less than ten acres, which is in size and exclusively or 355.6intensively used in the preceding year for raising or cultivating agricultural products, shall 355.7be considered as agricultural land. To qualify under this paragraph, property that includes 355.8a residential structure must be used intensively for one of the following purposes:; or355.9    (2) contiguous acreage that contains a residence and is less than 11 acres in size, if 355.10the contiguous acreage exclusive of the house, garage, and surrounding one acre of land 355.11was used in the preceding year for one or more of the following three uses:355.12    (i) for an intensive grain drying or storage of grain operation, or for intensive 355.13machinery or equipment storage of machinery or equipment activities used to support 355.14agricultural activities on other parcels of property operated by the same farming entity;355.15    (ii) as a nursery, provided that only those acres used intensively to produce nursery 355.16stock are considered agricultural land; or355.17    (iii) for livestock or poultry confinement, provided that land that is used only for 355.18pasturing and grazing does not qualify; or355.19    (iv) (iii) for intensive market farming; for purposes of this paragraph, "market 355.20farming" means the cultivation of one or more fruits or vegetables or production of animal 355.21or other agricultural products for sale to local markets by the farmer or an organization 355.22with which the farmer is affiliated.355.23    "Contiguous acreage," for purposes of this paragraph, means all of a tax parcel as 355.24described in section 272.193, or all of a set of contiguous tax parcels under that section 355.25that are owned by the same person.355.26    (g) Land shall be classified as agricultural even if all or a portion of the agricultural 355.27use of that property is the leasing to, or use by another person for agricultural purposes.355.28    Classification under this subdivision is not determinative for qualifying under 355.29section 
         273.111.355.30    (h) The property classification under this section supersedes, for property tax 355.31purposes only, any locally administered agricultural policies or land use restrictions that 355.32define minimum or maximum farm acreage.355.33    (i) The term "agricultural products" as used in this subdivision includes production 355.34for sale of:356.1    (1) livestock, dairy animals, dairy products, poultry and poultry products, fur-bearing 356.2animals, horticultural and nursery stock, fruit of all kinds, vegetables, forage, grains, 356.3bees, and apiary products by the owner;356.4    (2) fish bred for sale and consumption if the fish breeding occurs on land zoned 356.5for agricultural use;356.6    (3) the commercial boarding of horses, which may include related horse training and 356.7riding instruction, if the boarding is done on property that is also used for raising pasture 356.8to graze horses or raising or cultivating other agricultural products as defined in clause (1);356.9    (4) property which is owned and operated by nonprofit organizations used for 356.10equestrian activities, excluding racing;356.11    (5) game birds and waterfowl bred and raised (i) on a game farm licensed under 356.12section 
         97A.105, provided that the annual licensing report to the Department of Natural 356.13Resources, which must be submitted annually by March 30 to the assessor, indicates 356.14that at least 500 birds were raised or used for breeding stock on the property during the 356.15preceding year and that the owner provides a copy of the owner's most recent schedule F; 356.16or (ii) for use on a shooting preserve licensed under section 
         97A.115;356.17    (6) insects primarily bred to be used as food for animals;356.18    (7) trees, grown for sale as a crop, including short rotation woody crops, and not 356.19sold for timber, lumber, wood, or wood products; and356.20    (8) maple syrup taken from trees grown by a person licensed by the Minnesota 356.21Department of Agriculture under chapter 28A as a food processor.356.22    (j) If a parcel used for agricultural purposes is also used for commercial or industrial 356.23purposes, including but not limited to:356.24    (1) wholesale and retail sales;356.25    (2) processing of raw agricultural products or other goods;356.26    (3) warehousing or storage of processed goods; and356.27    (4) office facilities for the support of the activities enumerated in clauses (1), (2), 356.28and (3),356.29the assessor shall classify the part of the parcel used for agricultural purposes as class 356.301b, 2a, or 2b, whichever is appropriate, and the remainder in the class appropriate to its 356.31use. The grading, sorting, and packaging of raw agricultural products for first sale is 356.32considered an agricultural purpose. A greenhouse or other building where horticultural 356.33or nursery products are grown that is also used for the conduct of retail sales must be 356.34classified as agricultural if it is primarily used for the growing of horticultural or nursery 356.35products from seed, cuttings, or roots and occasionally as a showroom for the retail sale of 357.1those products. Use of a greenhouse or building only for the display of already grown 357.2horticultural or nursery products does not qualify as an agricultural purpose.357.3    (k) The assessor shall determine and list separately on the records the market value 357.4of the homestead dwelling and the one acre of land on which that dwelling is located. If 357.5any farm buildings or structures are located on this homesteaded acre of land, their market 357.6value shall not be included in this separate determination.357.7    (l) Class 2d airport landing area consists of a landing area or public access area of 357.8a privately owned public use airport. It has a class rate of one percent of market value. 357.9To qualify for classification under this paragraph, a privately owned public use airport 357.10must be licensed as a public airport under section 
         360.018. For purposes of this paragraph, 357.11"landing area" means that part of a privately owned public use airport properly cleared, 357.12regularly maintained, and made available to the public for use by aircraft and includes 357.13runways, taxiways, aprons, and sites upon which are situated landing or navigational aids. 357.14A landing area also includes land underlying both the primary surface and the approach 357.15surfaces that comply with all of the following:357.16    (i) the land is properly cleared and regularly maintained for the primary purposes of 357.17the landing, taking off, and taxiing of aircraft; but that portion of the land that contains 357.18facilities for servicing, repair, or maintenance of aircraft is not included as a landing area;357.19    (ii) the land is part of the airport property; and357.20    (iii) the land is not used for commercial or residential purposes.357.21The land contained in a landing area under this paragraph must be described and certified 357.22by the commissioner of transportation. The certification is effective until it is modified, 357.23or until the airport or landing area no longer meets the requirements of this paragraph. 357.24For purposes of this paragraph, "public access area" means property used as an aircraft 357.25parking ramp, apron, or storage hangar, or an arrival and departure building in connection 357.26with the airport.357.27    (m) Class 2e consists of land with a commercial aggregate deposit that is not actively 357.28being mined and is not otherwise classified as class 2a or 2b, provided that the land is not 357.29located in a county that has elected to opt-out of the aggregate preservation program as 357.30provided in section 
         273.1115, subdivision 6. It has a class rate of one percent of market 357.31value. To qualify for classification under this paragraph, the property must be at least 357.32ten contiguous acres in size and the owner of the property must record with the county 357.33recorder of the county in which the property is located an affidavit containing:357.34    (1) a legal description of the property;357.35    (2) a disclosure that the property contains a commercial aggregate deposit that is not 357.36actively being mined but is present on the entire parcel enrolled;358.1    (3) documentation that the conditional use under the county or local zoning 358.2ordinance of this property is for mining; and358.3    (4) documentation that a permit has been issued by the local unit of government 358.4or the mining activity is allowed under local ordinance. The disclosure must include a 358.5statement from a registered professional geologist, engineer, or soil scientist delineating 358.6the deposit and certifying that it is a commercial aggregate deposit.358.7    For purposes of this section and section 
         273.1115, "commercial aggregate deposit" 358.8means a deposit that will yield crushed stone or sand and gravel that is suitable for use 358.9as a construction aggregate; and "actively mined" means the removal of top soil and 358.10overburden in preparation for excavation or excavation of a commercial deposit.358.11    (n) When any portion of the property under this subdivision or subdivision 22 begins 358.12to be actively mined, the owner must file a supplemental affidavit within 60 days from 358.13the day any aggregate is removed stating the number of acres of the property that is 358.14actively being mined. The acres actively being mined must be (1) valued and classified 358.15under subdivision 24 in the next subsequent assessment year, and (2) removed from the 358.16aggregate resource preservation property tax program under section 
         273.1115, if the 358.17land was enrolled in that program. Copies of the original affidavit and all supplemental 358.18affidavits must be filed with the county assessor, the local zoning administrator, and the 358.19Department of Natural Resources, Division of Land and Minerals. A supplemental 358.20affidavit must be filed each time a subsequent portion of the property is actively mined, 358.21provided that the minimum acreage change is five acres, even if the actual mining activity 358.22constitutes less than five acres.358.23    (o) The definitions prescribed by the commissioner under paragraphs (c) and (d) are 358.24not rules and are exempt from the rulemaking provisions of chapter 14, and the provisions 358.25in section 
         14.386 concerning exempt rules do not apply.358.26EFFECTIVE DATE.This section is effective for taxes payable in 2014 and 358.27thereafter.358.28    Sec. 10. Minnesota Statutes 2012, section 273.19, subdivision 1, is amended to read:358.29    Subdivision 1. Tax-exempt property; lease. Except as provided in subdivision 3 or 358.304, tax-exempt property held under a lease for a term of at least one year, and not taxable 358.31under section 
         272.01, subdivision 2, or under a contract for the purchase thereof, shall be 358.32considered, for all purposes of taxation, as the property of the person holding it. In this 358.33subdivision, "tax-exempt property" means property owned by the United States, the state358.34 or any of its political subdivisions, a school, or any religious, scientific, or benevolent 358.35society or institution, incorporated or unincorporated, or any corporation whose property 359.1is not taxed in the same manner as other property. This subdivision does not apply to 359.2property exempt from taxation under section 
         272.01, subdivision 2, paragraph (b), clauses 359.3(2), (3), and (4), or to property exempt from taxation under section 
         272.0213.359.4EFFECTIVE DATE.This section is effective the day following final enactment.359.5    Sec. 11. Minnesota Statutes 2012, section 273.372, subdivision 4, is amended to read:359.6    Subd. 4. Administrative appeals. (a) Companies that submit the reports under 359.7section 
         270.82 or 
         273.371 by the date specified in that section, or by the date specified by 359.8the commissioner in an extension, may appeal administratively to the commissioner prior 359.9to bringing an action in court by submitting.359.10    (b) Companies that must submit reports under section 270.82 must submit a written 359.11request with to the commissioner for a conference within ten days after the date of the 359.12commissioner's valuation certification or notice to the company, or by May June 15, 359.13whichever is earlier.359.14    (c) Companies that submit reports under section 273.371 must submit a written 359.15request to the commissioner for a conference within ten days after the date of the 359.16commissioner's valuation certification or notice to the company, or by July 1, whichever 359.17is earlier.359.18    (d) The commissioner shall conduct the conference upon the commissioner's entire 359.19files and records and such further information as may be offered. The conference must 359.20be held no later than 20 days after the date of the commissioner's valuation certification 359.21or notice to the company, or by the date specified by the commissioner in an extension. 359.22Within 60 days after the conference the commissioner shall make a final determination of 359.23the matter and shall notify the company promptly of the determination. The conference 359.24is not a contested case hearing.359.25    (b) (e) In addition to the opportunity for a conference under paragraph (a), the 359.26commissioner shall also provide the railroad and utility companies the opportunity to 359.27discuss any questions or concerns relating to the values established by the commissioner 359.28through certification or notice in a less formal manner. This does not change or modify 359.29the deadline for requesting a conference under paragraph (a), the deadline in section 359.30271.06
          for appealing an order of the commissioner, or the deadline in section 
         278.01 for 359.31appealing property taxes in court.359.32EFFECTIVE DATE.This section is effective beginning with assessment year 2014.359.33    Sec. 12. Minnesota Statutes 2012, section 273.39, is amended to read:360.1273.39 RURAL AREA.360.2    As used in sections 
         273.39 to 
         273.41, the term "rural area" shall be deemed to mean 360.3any area of the state not included within the boundaries of any incorporated statutory 360.4city or home rule charter city, and such term shall be deemed to include both farm and 360.5nonfarm population thereof.360.6EFFECTIVE DATE.This section is effective the day following final enactment.360.7    Sec. 13. Minnesota Statutes 2012, section 279.06, subdivision 1, is amended to read:360.8    Subdivision 1. List and notice. Within five days after the filing of such list, the 360.9court administrator shall return a copy thereof to the county auditor, with a notice prepared 360.10and signed by the court administrator, and attached thereto, which may be substantially in 360.11the following form:

360.12State of Minnesota)360.13) ss.360.14County of 
                     							.....
                     						)360.15District Court360.16
                     							.....
                     						Judicial District.

360.17    The state of Minnesota, to all persons, companies, or corporations who have or claim 360.18any estate, right, title, or interest in, claim to, or lien upon, any of the several parcels of 360.19land described in the list hereto attached:360.20    The list of taxes and penalties on real property for the county of ............................... 360.21remaining delinquent on the first Monday in January, ......., has been filed in the office of 360.22the court administrator of the district court of said county, of which that hereto attached is a 360.23copy. Therefore, you, and each of you, are hereby required to file in the office of said court 360.24administrator, on or before the 20th day after the publication of this notice and list, your 360.25answer, in writing, setting forth any objection or defense you may have to the taxes, or any 360.26part thereof, upon any parcel of land described in the list, in, to, or on which you have or 360.27claim any estate, right, title, interest, claim, or lien, and, in default thereof, judgment will 360.28be entered against such parcel of land for the taxes on such list appearing against it, and 360.29for all penalties, interest, and costs. Based upon said judgment, the land shall be sold to 360.30the state of Minnesota on the second Monday in May, ....... The period of redemption for 360.31all lands sold to the state at a tax judgment sale shall be three years from the date of sale to 360.32the state of Minnesota if the land is within an incorporated area unless it is:360.33    (a) nonagricultural homesteaded land as defined in section 273.13, subdivision 22;360.34    (b) homesteaded agricultural land as defined in section 273.13, subdivision 23, 360.35paragraph (a);361.1    (c) seasonal residential recreational land as defined in section 273.13, subdivisions 361.222, paragraph (c), and 25, paragraph (d), clause (1), in which event the period of 361.3redemption is five years from the date of sale to the state of Minnesota;361.4    (d) abandoned property and pursuant to section 281.173 a court order has been 361.5entered shortening the redemption period to five weeks; or361.6    (e) vacant property as described under section 281.174, subdivision 2, and for which 361.7a court order is entered shortening the redemption period under section 281.174.361.8    The period of redemption for all other lands sold to the state at a tax judgment sale 361.9shall be five years from the date of sale.361.10    Inquiries as to the proceedings set forth above can be made to the county auditor of 361.11..... county whose address is ......

361.12(Signed) 
                     							.....
                     						,361.13361.14Court Administrator of the District Court of the
                  		County of 
                     							.....
                     						361.15(Here insert list.)

361.16    The notice must contain a narrative description of the various periods to redeem 361.17specified in sections 281.17, 281.173, and 281.174, in the manner prescribed by the 361.18commissioner of revenue under subdivision 2.361.19    The list referred to in the notice shall be substantially in the following form:361.20    List of real property for the county of ......................., on which taxes remain 361.21delinquent on the first Monday in January, .......361.22Town of (Fairfield),361.23Township (40), Range (20),

361.24361.25361.26361.27361.28361.29361.30361.31Names (and Current 
                  		Filed Addresses) for 
                  		the Taxpayers and Fee 
                  		Owners and in Addition 
                  		Those Parties Who Have 
                  		Filed Their Addresses 
                  		Pursuant to section 276.041Subdivision of
                  		SectionSectionTax Parcel
                  		NumberTotal Tax 
                  		and Penalty361.32$ cts.361.33361.34John Jones (825 Fremont 
                  		Fairfield, MN 55000)S.E. 1/4 of S.W. 1/410231012.20362.1362.2362.3362.4362.5362.6362.7362.8362.9362.10362.11362.12362.13362.14362.15362.16362.17362.18362.19Bruce Smith (2059 Hand 
                  		Fairfield, MN 55000) 
                  		and Fairfield State 
                  		Bank (100 Main Street 
                  		Fairfield, MN 55000)That part of N.E. 1/4 
                  		of S.W. 1/4 desc. as 
                  		follows: Beg. at the 
                  		S.E. corner of said N.E. 
                  		1/4 of S.W. 1/4; thence 
                  		N. along the E. line of 
                  		said N.E. 1/4 of S.W. 
                  		1/4 a distance of 600 
                  		ft.; thence W. parallel 
                  		with the S. line of said 
                  		N.E. 1/4 of S.W. 1/4 
                  		a distance of 600 ft.; 
                  		thence S. parallel with 
                  		said E. line a distance of 
                  		600 ft. to S. line of said 
                  		N.E. 1/4 of S.W. 1/4; 
                  		thence E. along said S. 
                  		line a distance of 600 ft. 
                  		to the point of beg.21332113.15

362.20    As to platted property, the form of heading shall conform to circumstances and be 362.21substantially in the following form:362.22City of (Smithtown)362.23Brown's Addition, or Subdivision

362.24362.25362.26362.27362.28362.29362.30362.31Names (and Current 
                  		Filed Addresses) for 
                  		the Taxpayers and Fee 
                  		Owners and in Addition 
                  		Those Parties Who Have 
                  		Filed Their Addresses 
                  		Pursuant to section 276.041LotBlockTax Parcel
                  		NumberTotal Tax
                  		and Penalty362.32$ cts.362.33362.34John Jones (825 Fremont 
                  		Fairfield, MN 55000)159582432.20362.35362.36362.37362.38362.39Bruce Smith (2059 Hand 
                  		Fairfield, MN 55000) 
                  		and Fairfield State 
                  		Bank (100 Main Street 
                  		Fairfield, MN 55000)169582443.15

362.40    The names, descriptions, and figures employed in parentheses in the above forms are 362.41merely for purposes of illustration.362.42    The name of the town, township, range or city, and addition or subdivision, as the 362.43case may be, shall be repeated at the head of each column of the printed lists as brought 362.44forward from the preceding column.362.45    Errors in the list shall not be deemed to be a material defect to affect the validity 362.46of the judgment and sale.363.1EFFECTIVE DATE.This section is effective for lists and notices required after 363.2December 31, 2013.363.3    Sec. 14. Minnesota Statutes 2012, section 290B.04, subdivision 2, is amended to read:363.4    Subd. 2. Approval; recording. The commissioner shall approve all initial 363.5applications that qualify under this chapter and shall notify qualifying homeowners on or 363.6before December 1. The commissioner may investigate the facts or require confirmation 363.7in regard to an application. The commissioner shall record or file a notice of qualification 363.8for deferral, including the names of the qualifying homeowners and a legal description 363.9of the property, in the office of the county recorder, or registrar of titles, whichever is 363.10applicable, in the county where the qualifying property is located. The notice must state 363.11that it serves as a notice of lien and that it includes deferrals under this section for future 363.12years. The commissioner shall prescribe the form of the notice. Execution of the notice 363.13by the original or facsimile signature of the commissioner or a delegate entitles them to 363.14be recorded, and no other attestation, certification, or acknowledgment is necessary. The 363.15homeowner shall pay the recording or filing fees for the notice, which, notwithstanding 363.16section 
         357.18, shall be paid by the homeowner at the time of satisfaction of the lien.363.17EFFECTIVE DATE.This section is effective for notices that are both executed 363.18and recorded after June 30, 2013.363.19    Sec. 15. Minnesota Statutes 2012, section 298.01, subdivision 3, is amended to read:363.20    Subd. 3. Occupation tax; other ores.  Every person engaged in the business of 363.21mining, refining, or producing ores, metals, or minerals in this state, except iron ore or 363.22taconite concentrates, shall pay an occupation tax to the state of Minnesota as provided 363.23in this subdivision. For purposes of this subdivision, mining includes the application of 363.24hydrometallurgical processes. Hydrometallurgical processes are processes that extract 363.25the ores, metals, or minerals, by use of aqueous solutions that leach, concentrate, and 363.26recover the ore, metal, or mineral. The tax is determined in the same manner as the tax 363.27imposed by section 
         290.02, except that sections 
         290.05, subdivision 1, clause (a), 
         290.17, 363.28subdivision 4
         , and 
         290.191, subdivision 2, do not apply, and the occupation tax must 363.29be computed by applying to taxable income the rate of 2.45 percent. A person subject 363.30to occupation tax under this section shall apportion its net income on the basis of the 363.31percentage obtained by taking the sum of:363.32    (1) 75 percent of the percentage which the sales made within this state in connection 363.33with the trade or business during the tax period are of the total sales wherever made in 363.34connection with the trade or business during the tax period;364.1    (2) 12.5 percent of the percentage which the total tangible property used by the 364.2taxpayer in this state in connection with the trade or business during the tax period is of 364.3the total tangible property, wherever located, used by the taxpayer in connection with the 364.4trade or business during the tax period; and364.5    (3) 12.5 percent of the percentage which the taxpayer's total payrolls paid or incurred 364.6in this state or paid in respect to labor performed in this state in connection with the trade 364.7or business during the tax period are of the taxpayer's total payrolls paid or incurred in 364.8connection with the trade or business during the tax period.364.9    The tax is in addition to all other taxes.364.10EFFECTIVE DATE.This section is effective the day following final enactment.364.11    Sec. 16. Minnesota Statutes 2012, section 298.018, is amended to read:364.12298.018 DISTRIBUTION OF PROCEEDS.364.13    Subdivision 1. Within taconite assistance area. The proceeds of the tax paid 364.14under sections 
         298.015 and 
         298.016 on ores, metals, or minerals and energy resources364.15 mined or extracted within the taconite assistance area defined in section 
         273.1341, shall 364.16be allocated as follows:364.17    (1) five percent to the city or town within which the minerals or energy resources 364.18are mined or extracted;364.19    (2) ten percent to the taconite municipal aid account to be distributed as provided 364.20in section 
         298.282;364.21    (3) ten percent to the school district within which the minerals or energy resources 364.22are mined or extracted;364.23    (4) 20 percent to a group of school districts comprised of those school districts 364.24wherein the mineral or energy resource was mined or extracted or in which there is a 364.25qualifying municipality as defined by section 
         273.134, paragraph (b), in direct proportion 364.26to school district indexes as follows: for each school district, its pupil units determined 364.27under section 
         126C.05 for the prior school year shall be multiplied by the ratio of the 364.28average adjusted net tax capacity per pupil unit for school districts receiving aid under 364.29this clause as calculated pursuant to chapters 122A, 126C, and 127A for the school year 364.30ending prior to distribution to the adjusted net tax capacity per pupil unit of the district. 364.31Each district shall receive that portion of the distribution which its index bears to the sum 364.32of the indices for all school districts that receive the distributions;364.33    (5) 20 percent to the county within which the minerals or energy resources are 364.34mined or extracted;365.1    (6) 20 percent to St. Louis County acting as the counties' fiscal agent to be 365.2distributed as provided in sections 
         273.134 to 
         273.136;365.3    (7) five percent to the Iron Range Resources and Rehabilitation Board for the 365.4purposes of section 
         298.22;365.5    (8) five percent to the Douglas J. Johnson economic protection trust fund; and365.6    (9) five percent to the taconite environmental protection fund.365.7    The proceeds of the tax shall be distributed on July 15 each year.365.8    Subd. 2. Outside taconite assistance area. The proceeds of the tax paid under 365.9sections 
         298.015 and 
         298.016 on ores, metals, or minerals and energy resources mined 365.10or extracted outside of the taconite assistance area defined in section 
         273.1341, shall 365.11be deposited in the general fund.365.12EFFECTIVE DATE.This section is effective the day following final enactment.365.13    Sec. 17. Minnesota Statutes 2012, section 373.01, subdivision 1, is amended to read:365.14    Subdivision 1. Public corporation; listed powers. (a) Each county is a body politic 365.15and corporate and may:365.16    (1) Sue and be sued.365.17    (2) Acquire and hold real and personal property for the use of the county, and lands 365.18sold for taxes as provided by law.365.19    (3) Purchase and hold for the benefit of the county real estate sold by virtue of 365.20judicial proceedings, to which the county is a party.365.21    (4) Sell, lease, and convey real or personal estate owned by the county, and give 365.22contracts or options to sell, lease, or convey it, and make orders respecting it as deemed 365.23conducive to the interests of the county's inhabitants.365.24    (5) Make all contracts and do all other acts in relation to the property and concerns 365.25of the county necessary to the exercise of its corporate powers.365.26    (b) No sale, lease, or conveyance of real estate owned by the county, except the lease 365.27of a residence acquired for the furtherance of an approved capital improvement project, nor 365.28any contract or option for it, shall be valid, without first advertising for bids or proposals in 365.29the official newspaper of the county for three consecutive weeks and once in a newspaper 365.30of general circulation in the area where the property is located. The notice shall state the 365.31time and place of considering the proposals, contain a legal description of any real estate, 365.32and a brief description of any personal property. Leases that do not exceed $15,000 for any 365.33one year may be negotiated and are not subject to the competitive bid procedures of this 365.34section. All proposals estimated to exceed $15,000 in any one year shall be considered at 366.1the time set for the bid opening, and the one most favorable to the county accepted, but the 366.2county board may, in the interest of the county, reject any or all proposals.366.3    (c) Sales of personal property the value of which is estimated to be $15,000 or 366.4more shall be made only after advertising for bids or proposals in the county's official 366.5newspaper, on the county's Web site, or in a recognized industry trade journal. At the same 366.6time it posts on its Web site or publishes in a trade journal, the county must publish in the 366.7official newspaper, either as part of the minutes of a regular meeting of the county board 366.8or in a separate notice, a summary of all requests for bids or proposals that the county 366.9advertises on its Web site or in a trade journal. After publication in the official newspaper, 366.10on the Web site, or in a trade journal, bids or proposals may be solicited and accepted by 366.11the electronic selling process authorized in section 
         471.345, subdivision 17. Sales of 366.12personal property the value of which is estimated to be less than $15,000 may be made 366.13either on competitive bids or in the open market, in the discretion of the county board. 366.14"Web site" means a specific, addressable location provided on a server connected to the 366.15Internet and hosting World Wide Web pages and other files that are generally accessible 366.16on the Internet all or most of a day.366.17    (d) Notwithstanding anything to the contrary herein, the county may, when acquiring 366.18real property for county highway right-of-way, exchange parcels of real property of 366.19substantially similar or equal value without advertising for bids. The estimated values for 366.20these parcels shall be determined by the county assessor.366.21    (e) Notwithstanding anything in this section to the contrary, the county may, when 366.22acquiring real property for purposes other than county highway right-of-way, exchange 366.23parcels of real property of substantially similar or equal value without advertising for 366.24bids. The estimated values for these parcels must be determined by the county assessor 366.25or a private appraisal performed by a licensed Minnesota real estate appraiser. For the 366.26purpose of determining for the county the estimated values of parcels proposed to be 366.27exchanged, the county assessor need not be licensed under chapter 82B. Before giving 366.28final approval to any exchange of land, the county board shall hold a public hearing on 366.29the exchange. At least two weeks before the hearing, the county auditor shall post a 366.30notice in the auditor's office and the official newspaper of the county of the hearing that 366.31contains a description of the lands affected.366.32    (f) If real estate or personal property remains unsold after advertising for and 366.33consideration of bids or proposals the county may employ a broker to sell the property. 366.34The broker may sell the property for not less than 90 percent of its appraised market value 366.35as determined by the county. The broker's fee shall be set by agreement with the county but 366.36may not exceed ten percent of the sale price and must be paid from the proceeds of the sale.367.1    (g) A county or its agent may rent a county-owned residence acquired for the 367.2furtherance of an approved capital improvement project subject to the conditions set 367.3by the county board and not subject to the conditions for lease otherwise provided by 367.4paragraph (a), clause (4), and paragraphs (b), (c), (d), (f), and (h).367.5    (h) In no case shall lands be disposed of without there being reserved to the county 367.6all iron ore and other valuable minerals in and upon the lands, with right to explore for, 367.7mine and remove the iron ore and other valuable minerals, nor shall the minerals and 367.8mineral rights be disposed of, either before or after disposition of the surface rights, 367.9otherwise than by mining lease, in similar general form to that provided by section 
         93.20 367.10for mining leases affecting state lands. The lease shall be for a term not exceeding 50 367.11years, and be issued on a royalty basis, the royalty to be not less than 25 cents per ton of 367.122,240 pounds, and fix a minimum amount of royalty payable during each year, whether 367.13mineral is removed or not. Prospecting options for mining leases may be granted for 367.14periods not exceeding one year. The options shall require, among other things, periodical 367.15showings to the county board of the results of exploration work done.367.16    (i) Notwithstanding anything in this subdivision to the contrary, the county may, 367.17when selling real property owned in fee simple that cannot be improved because of 367.18noncompliance with local ordinances regarding minimum area, shape, frontage, or access, 367.19proceed to sell the nonconforming parcel without advertising for bid. At the county's 367.20discretion, the real property may be restricted to sale to adjoining landowners or may be 367.21sold to any other interested party. The property shall be sold to the highest bidder, but in no 367.22case shall the property be sold for less than 90 percent of its fair market value as determined 367.23by the county assessor. All owners of land adjoining the land to be sold shall be given a 367.24written notice at least 30 days before the sale. This paragraph shall be liberally construed to 367.25encourage the sale of nonconforming real property and promote its return to the tax roles.367.26EFFECTIVE DATE.This section is effective the day following final enactment.367.27    Sec. 18.  REPEALER.367.28Minnesota Statutes 2012, sections 272.69; and 273.11, subdivisions 1a and 22, are 367.29repealed.367.30EFFECTIVE DATE.This section is effective the day following final enactment.367.31ARTICLE 18367.32DEPARTMENT POLICY AND TECHNICAL: MISCELLANEOUS PROVISIONS367.33    Section 1. Minnesota Statutes 2012, section 16A.46, is amended to read:368.116A.46 LOST OR DESTROYED WARRANT DUPLICATE; INDEMNITY.368.2    Subdivision 1.Duplicate warrant. The commissioner may issue a duplicate of an 368.3unpaid warrant to an owner if the owner certifies that the original was lost or destroyed. The 368.4commissioner may require certification be documented by affidavit. The commissioner 368.5may refuse to issue a duplicate of an unpaid state warrant. If the commissioner acts in 368.6good faith, the commissioner is not liable, whether the application is granted or denied.368.7    Subd. 2.Original warrant is void. When the duplicate is issued, the original is 368.8void. The commissioner may require an indemnity bond from the applicant to the state for 368.9double the amount of the warrant for anyone damaged by the issuance of the duplicate. 368.10The commissioner may refuse to issue a duplicate of an unpaid state warrant. If the 368.11commissioner acts in good faith the commissioner is not liable, whether the application is 368.12granted or denied is not liable to any holder who took the void original warrant for value, 368.13whether or not the commissioner required an indemnity bond from the applicant. 368.14    Subd. 3.Unpaid refund or rebate. For an unpaid refund or rebate issued under a 368.15tax law administered by the commissioner of revenue that has been lost or destroyed, an 368.16affidavit is not required for the commissioner to issue a duplicate if the duplicate is issued 368.17to the same name and Social Security number as the original warrant and that information 368.18is verified on a tax return filed by the recipient.368.19EFFECTIVE DATE.This section is effective the day following final enactment.368.20    Sec. 2. Minnesota Statutes 2012, section 270C.38, subdivision 1, is amended to read:368.21    Subdivision 1. Sufficient notice.(a) If no method of notification of a written 368.22determination or action of the commissioner is otherwise specifically provided for by 368.23law, notice of the determination or action sent postage prepaid by United States mail to 368.24the taxpayer or other person affected by the determination or action at the taxpayer's 368.25or person's last known address, is sufficient. If the taxpayer or person being notified is 368.26deceased or is under a legal disability, or, in the case of a corporation being notified that 368.27has terminated its existence, notice to the last known address of the taxpayer, person, or 368.28corporation is sufficient, unless the department has been provided with a new address by a 368.29party authorized to receive notices from the commissioner.368.30(b) If a taxpayer or other person agrees to accept notification by electronic means, 368.31notice of a determination or action of the commissioner sent by electronic mail to the 368.32taxpayer's or person's last known electronic mailing address as provided for in section 368.33325L.08 is sufficient.368.34EFFECTIVE DATE.This section is effective the day following final enactment.369.1    Sec. 3. Minnesota Statutes 2012, section 270C.42, subdivision 2, is amended to read:369.2    Subd. 2. Penalty for failure to pay electronically. In addition to other applicable 369.3penalties imposed by law, after notification from the commissioner to the taxpayer that 369.4payments for a tax payable to the commissioner are required to be made by electronic 369.5means, and the payments are remitted by some other means, there is a penalty in the 369.6amount of five percent of each payment that should have been remitted electronically. 369.7After the commissioner's initial notification to the taxpayer that payments are required to 369.8be made by electronic means, the commissioner is not required to notify the taxpayer in 369.9subsequent periods if the initial notification specified the amount of tax liability at which a 369.10taxpayer is required to remit payments by electronic means. The penalty can be abated 369.11under the abatement procedures prescribed in section 
         270C.34 if the failure to remit the 369.12payment electronically is due to reasonable cause. The penalty bears interest at the rate 369.13specified in section 
         270C.40 from the due date of the payment of the tax provided in 369.14section 270C.40, subdivision 3, to the date of payment of the penalty.369.15EFFECTIVE DATE.This section is effective the day following final enactment.369.16    Sec. 4. Minnesota Statutes 2012, section 287.385, subdivision 7, is amended to read:369.17    Subd. 7. Interest on penalties. A penalty imposed under this chapter bears interest 369.18from the date payment was required to be paid, including any extensions, provided in 369.19section 270C.40, subdivision 3, to the date of payment of the penalty.369.20EFFECTIVE DATE.This section is effective the day following final enactment.369.21    Sec. 5. Minnesota Statutes 2012, section 289A.55, subdivision 9, is amended to read:369.22    Subd. 9. Interest on penalties. (a) A penalty imposed under section 
         289A.60, 369.23subdivision 1
         , 2, 2a, 4, 5, 6, or 21 bears interest from the date the return or payment 369.24was required to be filed or paid, including any extensions provided in section 270C.40, 369.25subdivision 3, to the date of payment of the penalty.369.26(b) A penalty not included in paragraph (a) bears interest only if it is not paid within 369.2760 days from the date of notice. In that case interest is imposed from the date of notice 369.28to the date of payment.369.29EFFECTIVE DATE.This section is effective the day following final enactment.369.30    Sec. 6. Minnesota Statutes 2012, section 289A.60, subdivision 4, is amended to read:370.1    Subd. 4. Substantial understatement of liability; penalty. (a) The commissioner 370.2of revenue shall impose a penalty for substantial understatement of any tax payable to the 370.3commissioner, except a tax imposed under chapter 297A.370.4(b) There must be added to the tax an amount equal to 20 percent of the amount of any 370.5underpayment attributable to the understatement. There is a substantial understatement of 370.6tax for the period if the amount of the understatement for the period exceeds the greater of:370.7(1) ten percent of the tax required to be shown on the return for the period; or370.8(2)(i) $10,000 in the case of a mining company or a corporation, other than an S 370.9corporation as defined in section 
         290.9725, when the tax is imposed by chapter 290 or 370.10section 
         298.01 or 
         298.015, or370.11(ii) $5,000 in the case of any other taxpayer, and in the case of a mining company or 370.12a corporation any tax not imposed by chapter 290 or section 
         298.01 or 
         298.015.370.13(c) For a corporation, other than an S corporation, there is also a substantial 370.14understatement of tax for any taxable year if the amount of the understatement for the 370.15taxable year exceeds the lesser of:370.16(1) ten percent of the tax required to be shown on the return for the taxable year 370.17(or, if greater, $10,000); or370.18(2) $10,000,000.370.19(d) The term "understatement" means the excess of the amount of the tax required 370.20to be shown on the return for the period, over the amount of the tax imposed that is 370.21shown on the return. The excess must be determined without regard to items to which 370.22subdivision 27 applies. The amount of the understatement shall be reduced by that part of 370.23the understatement that is attributable to the tax treatment of any item by the taxpayer if 370.24(1) there is or was substantial authority for the treatment, or (2)(i) any item with respect to 370.25which the relevant facts affecting the item's tax treatment are adequately disclosed in the 370.26return or in a statement attached to the return and (ii) there is a reasonable basis for the tax 370.27treatment of the item. The exception for substantial authority under clause (1) does not 370.28apply to positions listed by the Secretary of the Treasury under section 6662(d)(3) of the 370.29Internal Revenue Code. A corporation does not have a reasonable basis for its tax treatment 370.30of an item attributable to a multiple-party financing transaction if the treatment does not 370.31clearly reflect the income of the corporation within the meaning of section 6662(d)(2)(B) 370.32of the Internal Revenue Code. The special rules in cases involving tax shelters provided in 370.33section 6662(d)(2)(C) of the Internal Revenue Code shall apply and shall apply to a tax 370.34shelter the principal purpose of which is the avoidance or evasion of state taxes.370.35(e) The commissioner may abate all or any part of the addition to the tax provided 370.36by this section on a showing by the taxpayer that there was reasonable cause for the 371.1understatement, or part of it, and that the taxpayer acted in good faith. The additional tax 371.2and penalty shall bear interest at the rate as specified in section 
         270C.40from the time 371.3the tax should have been paid until paid.371.4EFFECTIVE DATE.This section is effective the day following final enactment.371.5    Sec. 7. Minnesota Statutes 2012, section 296A.01, subdivision 7, is amended to read:371.6    Subd. 7. Aviation gasoline. "Aviation gasoline" means any gasoline that is 371.7capable of use for the purpose of producing or generating power for propelling internal 371.8combustion engine aircraft, that meets the specifications in ASTM specification D910-07a371.9 D910-11, and that either:371.10    (1) is invoiced and billed by a producer, manufacturer, refiner, or blender to a 371.11distributor or dealer, by a distributor to a dealer or consumer, or by a dealer to consumer, 371.12as "aviation gasoline"; or371.13    (2) whether or not invoiced and billed as provided in clause (1), is received, sold, 371.14stored, or withdrawn from storage by any person, to be used for the purpose of producing 371.15or generating power for propelling internal combustion engine aircraft.371.16EFFECTIVE DATE.This section is effective the day following final enactment.371.17    Sec. 8. Minnesota Statutes 2012, section 296A.01, subdivision 8, is amended to read:371.18    Subd. 8. Aviation turbine fuel and jet fuel. "Aviation turbine fuel" and "jet 371.19fuel" mean blends of hydrocarbons derived from crude petroleum, natural gasoline, and 371.20synthetic hydrocarbons, intended for use in aviation turbine engines, and that meet the 371.21specifications in ASTM specification D1655-08a D1655-12.371.22EFFECTIVE DATE.This section is effective the day following final enactment.371.23    Sec. 9. Minnesota Statutes 2012, section 296A.01, is amended by adding a subdivision 371.24to read:371.25    Subd. 8b.Biobutanol."Biobutanol" means isobutyl alcohol produced by 371.26fermenting agriculturally generated organic material that is to be blended with gasoline 371.27and meets either:371.28    (1) the initial ASTM Standard Specification for Butanol for Blending with Gasoline 371.29for use as an Automotive Spark-Ignition Engine Fuel once it has been released by ASTM 371.30for general distribution; or371.31    (2) in the absence of an ASTM Standard Specification, the following list of 371.32requirements:372.1    (i) visually free of sediment and suspended matter;372.2    (ii) clear and bright at the ambient temperature of 21 degrees Celsius or the ambient 372.3temperature whichever is higher;372.4    (iii) free of any adulterant or contaminant that can render it unacceptable for its 372.5commonly used applications;372.6    (iv) contains not less than 96 volume percent isobutyl alcohol;372.7    (v) contains not more than 0.4 volume percent methanol;372.8    (vi) contains not more than 1.0 volume percent water as determined by ASTM 372.9standard test method E203 or E1064;372.10    (vii) acidity (as acetic acid) of not more than 0.007 mass percent as determined 372.11by ASTM standard test method D1613;372.12    (viii) solvent washed gum content of not more than 5.0 milligrams per 100 milliliters 372.13as determined by ASTM standard test method D381;372.14    (ix) sulfur content of not more than 30 parts per million as determined by ASTM 372.15standard test method D2622 or D5453; and372.16    (x) contains not more than 4 parts per million total inorganic sulfate.372.17    Sec. 10. Minnesota Statutes 2012, section 296A.01, subdivision 14, is amended to read:372.18    Subd. 14. Diesel fuel oil. "Diesel fuel oil" means a petroleum distillate or blend of 372.19petroleum distillate and residual fuels that is intended for use as a motor fuel in internal 372.20combustion diesel engines and that meets ASTM specification D975-07b D975-11b.372.21EFFECTIVE DATE.This section is effective the day following final enactment.372.22    Sec. 11. Minnesota Statutes 2012, section 296A.01, subdivision 19, is amended to read:372.23    Subd. 19. E85. "E85" means a petroleum product that is a blend of agriculturally 372.24derived denatured ethanol and gasoline or natural gasoline that typically contains not more 372.25than 85 percent ethanol by volume, but at a minimum must contain 60 greater than 50372.26 percent ethanol by volume. For the purposes of this chapter, the energy content of E85 372.27will be considered to be 82,000 BTUs per gallon. E85 produced for use as a motor fuel in 372.28alternative fuel vehicles as defined in subdivision 5 must comply with ASTM specification 372.29D5798-07 D5798-11.372.30EFFECTIVE DATE.This section is effective the day following final enactment.372.31    Sec. 12. Minnesota Statutes 2012, section 296A.01, subdivision 20, is amended to read:373.1    Subd. 20. Ethanol, denatured. "Ethanol, denatured" means ethanol that is to 373.2be blended with gasoline, has been agriculturally derived, and complies with ASTM 373.3specification D4806-08 D4806-11a. This includes the requirement that ethanol may be 373.4denatured only as specified in Code of Federal Regulations, title 27, parts 20 and 21.373.5EFFECTIVE DATE.This section is effective the day following final enactment.373.6    Sec. 13. Minnesota Statutes 2012, section 296A.01, subdivision 23, is amended to read:373.7    Subd. 23. Gasoline. (a) "Gasoline" means:373.8    (1) all products commonly or commercially known or sold as gasoline regardless of 373.9their classification or uses, except casinghead gasoline, absorption gasoline, condensation 373.10gasoline, drip gasoline, or natural gasoline that under the requirements of section 
         239.761, 373.11subdivision 3
         , must not be blended with gasoline that has been sold, transferred, or 373.12otherwise removed from a refinery or terminal; and373.13    (2) any liquid prepared, advertised, offered for sale or sold for use as, or commonly 373.14and commercially used as, a fuel in spark-ignition, internal combustion engines, and that 373.15when tested by the Weights and Measures Division meets the specifications in ASTM 373.16specification D4814-08b D4814-11b.373.17    (b) Gasoline that is not blended with ethanol must not be contaminated with water or 373.18other impurities and must comply with both ASTM specification D4814-08b D4814-11b373.19 and the volatility requirements in Code of Federal Regulations, title 40, part 80.373.20    (c) After gasoline is sold, transferred, or otherwise removed from a refinery or 373.21terminal, a person responsible for the product:373.22    (1) may blend the gasoline with agriculturally derived ethanol, as provided in 373.23subdivision 24;373.24    (2) must not blend the gasoline with any oxygenate other than denatured, 373.25agriculturally derived ethanol;373.26    (3) must not blend the gasoline with other petroleum products that are not gasoline 373.27or denatured, agriculturally derived ethanol;373.28    (4) must not blend the gasoline with products commonly and commercially known 373.29as casinghead gasoline, absorption gasoline, condensation gasoline, drip gasoline, or 373.30natural gasoline; and373.31    (5) may blend the gasoline with a detergent additive, an antiknock additive, or an 373.32additive designed to replace tetra-ethyl lead, that is registered by the EPA.373.33EFFECTIVE DATE.This section is effective the day following final enactment.374.1    Sec. 14. Minnesota Statutes 2012, section 296A.01, subdivision 24, is amended to read:374.2    Subd. 24. Gasoline blended with nonethanol oxygenate. "Gasoline blended with 374.3nonethanol oxygenate" means gasoline blended with ETBE, MTBE, or other alcohol 374.4or ether, except denatured ethanol, that is approved as an oxygenate by the EPA, and 374.5that complies with ASTM specification D4814-08b D4814-11b. Oxygenates, other than 374.6denatured ethanol, must not be blended into gasoline after the gasoline has been sold, 374.7transferred, or otherwise removed from a refinery or terminal.374.8EFFECTIVE DATE.This section is effective the day following final enactment.374.9    Sec. 15. Minnesota Statutes 2012, section 296A.01, subdivision 26, is amended to read:374.10    Subd. 26. Heating fuel oil. "Heating fuel oil" means a petroleum distillate, blend 374.11of petroleum distillates and residuals, or petroleum residual heating fuel that meets the 374.12specifications in ASTM specification D396-08b D396-12.374.13EFFECTIVE DATE.This section is effective the day following final enactment.374.14    Sec. 16. Minnesota Statutes 2012, section 296A.22, subdivision 1, is amended to read:374.15    Subdivision 1. Penalty for failure to pay tax, general rule. Upon the failure of 374.16any person to pay any tax or fee when due, a penalty of one percent per day for the first 374.17ten days of delinquency shall accrue, and thereafter the tax, fees, and penalty shall bear 374.18interest at the rate specified in section 
         270C.40 until paid.374.19EFFECTIVE DATE.This section is effective the day following final enactment.374.20    Sec. 17. Minnesota Statutes 2012, section 296A.22, subdivision 3, is amended to read:374.21    Subd. 3. Operating without license. If any person operates as a distributor, special 374.22fuel dealer, bulk purchaser, or motor carrier without first securing the license required 374.23under this chapter, any tax or fee imposed by this chapter shall become immediately due 374.24and payable. A penalty of 25 percent is imposed upon the tax and fee due. The tax, and374.25 fees, and penalty shall bear interest at the rate specified in section 
         270C.40. The penalty 374.26imposed in this subdivision shall bear interest from the date provided in section 270C.40, 374.27subdivision 3, to the date of payment of the penalty.374.28EFFECTIVE DATE.This section is effective the day following final enactment.374.29    Sec. 18. Minnesota Statutes 2012, section 297B.11, is amended to read:375.1297B.11 REGISTRAR AS AGENT OF COMMISSIONER OF REVENUE; 375.2POWERS.375.3The state commissioner of revenue is charged with the administration of the 375.4sales tax on motor vehicles. The commissioner may prescribe all rules not inconsistent 375.5with the provisions of this chapter, necessary and advisable for the proper and efficient 375.6administration of the law. The collection of this sales tax on motor vehicles shall be 375.7carried out by the motor vehicle registrar who shall act as the agent of the commissioner 375.8and who shall be subject to all rules not inconsistent with the provisions of this chapter, 375.9that may be prescribed by the commissioner.375.10The provisions of chapters 270C, 289A, and 297A relating to the commissioner's 375.11authority to audit, assess, and collect the tax, and to issue refunds and to hear appeals, 375.12are applicable to the sales tax on motor vehicles. The commissioner may impose civil 375.13penalties as provided in chapters 289A and 297A, and the additional tax and penalties 375.14are subject to interest at the rate provided in section 
         270C.40 from the date provided in 375.15section 270C.40, subdivision 3, until paid.375.16EFFECTIVE DATE.This section is effective the day following final enactment.375.17    Sec. 19. Minnesota Statutes 2012, section 297E.14, subdivision 7, is amended to read:375.18    Subd. 7. Interest on penalties. (a) A penalty imposed under section 
         297E.12, 375.19subdivision 1
         , 2, 3, 4, or 5, bears interest from the date the return or payment was required 375.20to be filed or paid, including any extensions provided in section 270C.40, subdivision 375.213, to the date of payment of the penalty.375.22(b) A penalty not included in paragraph (a) bears interest only if it is not paid within 375.23ten days from the date of notice. In that case interest is imposed from the date of notice 375.24to the date of payment.375.25EFFECTIVE DATE.This section is effective the day following final enactment.375.26    Sec. 20. Minnesota Statutes 2012, section 297F.09, subdivision 9, is amended to read:375.27    Subd. 9. Interest. The amount of tax not timely paid, together with any penalty 375.28imposed in this section, bears interest at the rate specified in section 
         270C.40 from the 375.29time such tax should have been paid until paid. The penalty imposed in this section bears 375.30interest at the rate specified in section 270C.40 from the date provided in section 270C.40, 375.31subdivision 3, to the date of payment of the penalty. Any interest and penalty is added to 375.32the tax and collected as a part of it.375.33EFFECTIVE DATE.This section is effective the day following final enactment.376.1    Sec. 21. Minnesota Statutes 2012, section 297F.18, subdivision 7, is amended to read:376.2    Subd. 7. Interest on penalties. (a) A penalty imposed under section 
         297F.19, 376.3subdivisions 2 to 7, bears interest from the date the return or payment was required to be 376.4filed or paid, including any extensions provided in section 270C.40, subdivision 3, to the 376.5date of payment of the penalty.376.6(b) A penalty not included in paragraph (a) bears interest only if it is not paid within 376.7ten days from the date of the notice. In that case interest is imposed from the date of notice 376.8to the date of payment.376.9EFFECTIVE DATE.This section is effective the day following final enactment.376.10    Sec. 22. Minnesota Statutes 2012, section 297G.09, subdivision 8, is amended to read:376.11    Subd. 8. Interest. The amount of tax not timely paid, together with any penalty 376.12imposed by this chapter, bears interest at the rate specified in section 
         270C.40 from the 376.13time the tax should have been paid until paid. Any penalty imposed by this chapter bears 376.14interest from the date provided in section 270C.40, subdivision 3, to the date of payment 376.15of the penalty. Any interest and penalty is added to the tax and collected as a part of it.376.16EFFECTIVE DATE.This section is effective the day following final enactment.376.17    Sec. 23. Minnesota Statutes 2012, section 297G.17, subdivision 7, is amended to read:376.18    Subd. 7. Interest on penalties. (a) A penalty imposed under section 
         297G.18, 376.19subdivisions 2 to 7, bears interest from the date the return or payment was required to be 376.20filed or paid, including any extensions provided in section 270C.40, subdivision 3, to the 376.21date of payment of the penalty.376.22(b) A penalty not included in paragraph (a) bears interest only if it is not paid within 376.23ten days from the date of the notice. In that case interest is imposed from the date of notice 376.24to the date of payment.376.25EFFECTIVE DATE.This section is effective the day following final enactment.376.26    Sec. 24. Minnesota Statutes 2012, section 297I.80, subdivision 1, is amended to read:376.27    Subdivision 1. Payable to commissioner. (a) When interest is required under this 376.28section, interest is computed at the rate specified in section 
         270C.40.376.29(b) If a tax or surcharge is not paid within the time named by law for payment, the 376.30unpaid tax or surcharge bears interest from the date the tax or surcharge should have been 376.31paid until the date the tax or surcharge is paid.377.1(c) Whenever a taxpayer is liable for additional tax or surcharge because of a 377.2redetermination by the commissioner or other reason, the additional tax or surcharge 377.3bears interest from the time the tax or surcharge should have been paid until the date the 377.4tax or surcharge is paid.377.5(d) A penalty bears interest from the date the return or payment was required to be 377.6filed or paid provided in section 270C.40, subdivision 3, to the date of payment of the 377.7penalty.377.8EFFECTIVE DATE.This section is effective the day following final enactment.377.9    Sec. 25. Minnesota Statutes 2012, section 469.319, subdivision 4, is amended to read:377.10    Subd. 4. Repayment procedures. (a) For the repayment of taxes imposed under 377.11chapter 290 or 297A or local taxes collected pursuant to section 
         297A.99, a business must 377.12file an amended return with the commissioner of revenue and pay any taxes required 377.13to be repaid within 30 days after becoming subject to repayment under this section. 377.14The amount required to be repaid is determined by calculating the tax for the period or 377.15periods for which repayment is required without regard to the exemptions and credits 377.16allowed under section 
         469.315.377.17    (b) For the repayment of taxes imposed under chapter 297B, a business must pay any 377.18taxes required to be repaid to the motor vehicle registrar, as agent for the commissioner of 377.19revenue, within 30 days after becoming subject to repayment under this section.377.20    (c) For the repayment of property taxes, the county auditor shall prepare a tax 377.21statement for the business, applying the applicable tax extension rates for each payable 377.22year and provide a copy to the business and to the taxpayer of record. The business must 377.23pay the taxes to the county treasurer within 30 days after receipt of the tax statement. The 377.24business or the taxpayer of record may appeal the valuation and determination of the 377.25property tax to the Tax Court within 30 days after receipt of the tax statement.377.26    (d) The provisions of chapters 270C and 289A relating to the commissioner's 377.27authority to audit, assess, and collect the tax and to hear appeals are applicable to the 377.28repayment required under paragraphs (a) and (b). The commissioner may impose civil 377.29penalties as provided in chapter 289A, and the additional tax and penalties are subject 377.30to interest at the rate provided in section 
         270C.40,. The additional tax shall bear interest377.31 from 30 days after becoming subject to repayment under this section until the date the 377.32tax is paid. Any penalty imposed pursuant to this section shall bear interest from the date 377.33provided in section 270C.40, subdivision 3, to the date of payment of the penalty.377.34    (e) If a property tax is not repaid under paragraph (c), the county treasurer shall 377.35add the amount required to be repaid to the property taxes assessed against the property 378.1for payment in the year following the year in which the auditor provided the statement 378.2under paragraph (c).378.3    (f) For determining the tax required to be repaid, a reduction of a state or local sales or 378.4use tax is deemed to have been received on the date that the good or service was purchased 378.5or first put to a taxable use. In the case of an income tax or franchise tax, including the 378.6credit payable under section 
         469.318, a reduction of tax is deemed to have been received 378.7for the two most recent tax years that have ended prior to the date that the business became 378.8subject to repayment under this section. In the case of a property tax, a reduction of tax is 378.9deemed to have been received for the taxes payable in the year that the business became 378.10subject to repayment under this section and for the taxes payable in the prior year.378.11    (g) The commissioner may assess the repayment of taxes under paragraph (d) any 378.12time within two years after the business becomes subject to repayment under subdivision 378.131, or within any period of limitations for the assessment of tax under section 
         289A.38, 378.14whichever period is later. The county auditor may send the statement under paragraph 378.15(c) any time within three years after the business becomes subject to repayment under 378.16subdivision 1.378.17    (h) A business is not entitled to any income tax or franchise tax benefits, including 378.18refundable credits, for any part of the year in which the business becomes subject to 378.19repayment under this section nor for any year thereafter. Property is not exempt from tax 378.20under section 
         272.02, subdivision 64, for any taxes payable in the year following the year 378.21in which the property became subject to repayment under this section nor for any year 378.22thereafter. A business is not eligible for any sales tax benefits beginning with goods 378.23or services purchased or first put to a taxable use on the day that the business becomes 378.24subject to repayment under this section.378.25EFFECTIVE DATE.This section is effective the day following final enactment.378.26    Sec. 26. Minnesota Statutes 2012, section 469.340, subdivision 4, is amended to read:378.27    Subd. 4. Repayment procedures. (a) For the repayment of taxes imposed under 378.28chapter 290 or 297A or local taxes collected pursuant to section 
         297A.99, a business must 378.29file an amended return with the commissioner of revenue and pay any taxes required to be 378.30repaid within 30 days after ceasing to do business in the zone. The amount required to be 378.31repaid is determined by calculating the tax for the period or periods for which repayment 378.32is required without regard to the exemptions and credits allowed under section 
         469.336.378.33(b) For the repayment of property taxes, the county auditor shall prepare a tax 378.34statement for the business, applying the applicable tax extension rates for each payable 378.35year and provide a copy to the business. The business must pay the taxes to the county 379.1treasurer within 30 days after receipt of the tax statement. The taxpayer may appeal the 379.2valuation and determination of the property tax to the Tax Court within 30 days after 379.3receipt of the tax statement.379.4(c) The provisions of chapters 270C and 289A relating to the commissioner's 379.5authority to audit, assess, and collect the tax and to hear appeals are applicable to the 379.6repayment required under paragraph (a). The commissioner may impose civil penalties as 379.7provided in chapter 289A, and the additional tax and penalties are subject to interest at the 379.8rate provided in section 
         270C.40,. The additional tax shall bear interest from 30 days after 379.9ceasing to do business in the biotechnology and health sciences industry zone until the 379.10date the tax is paid. Any penalty imposed pursuant to this section shall bear interest from 379.11the date provided in section 270C.40, subdivision 3, to the date of payment of the penalty.379.12(d) If a property tax is not repaid under paragraph (b), the county treasurer shall add 379.13the amount required to be repaid to the property taxes assessed against the property for 379.14payment in the year following the year in which the treasurer discovers that the business 379.15ceased to operate in the biotechnology and health sciences industry zone.379.16(e) For determining the tax required to be repaid, a tax reduction is deemed to have 379.17been received on the date that the tax would have been due if the taxpayer had not been 379.18entitled to the exemption, or on the date a refund was issued for a refundable credit.379.19(f) The commissioner may assess the repayment of taxes under paragraph (c) any 379.20time within two years after the business ceases to operate in the biotechnology and health 379.21sciences industry zone, or within any period of limitations for the assessment of tax under 379.22section 
         289A.38, whichever period is later.379.23EFFECTIVE DATE.This section is effective the day following final enactment."379.24Delete the title and insert:379.25"A bill for an act379.26relating to financing and operation of state and local government; making 379.27changes to individual income, corporate franchise, property, sales and use, 379.28estate, mineral, tobacco, alcohol, special, local, and other taxes and tax-related 379.29provisions modifying the property tax refund; changing property tax aids and 379.30credits; modifying the Sustainable Forest Incentive Act; modifying education 379.31aids and levies; providing additional pension funding; modifying definitions and 379.32distributions for property taxes; providing for property tax exemptions; modifying 379.33the payment in lieu of tax provisions; modifying education aids and levies; 379.34modifying tobacco tax provisions; making changes to additions and subtractions 379.35from federal taxable income; providing for federal conformity; changing income 379.36tax rates for individuals, estates, and trusts; providing income tax credits; 379.37modifying estate tax provisions; providing for a state gift tax; expanding the sales 379.38tax base; modifying the duty to collect and remit sales taxes for certain sellers; 379.39imposing the sales tax on digital products and selected services; modifying the 379.40definition of sale and purchase; modifying provisions for the rental motor vehicle 379.41tax rate; providing for multiple points of use certificates; modifying sales tax 379.42exemptions; authorizing local sales taxes; authorizing economic development 380.1powers; modifying tax increment financing rules; providing authority, 380.2organization, powers, duties, and requiring a prevailing wage for development 380.3of a Destination Medical Center; authorizing state infrastructure aid; modifying 380.4the distribution of taconite production taxes; authorizing taconite production tax 380.5bonds for grants to school districts; modifying and providing provisions for 380.6public finance; providing funding for legislative office facilities; modifying the 380.7definition of market value for tax, debt, and other purposes; making conforming, 380.8policy, and technical changes to tax provisions; requiring studies and reports; 380.9appropriating money;amending Minnesota Statutes 2012, sections 13.792; 380.1016A.46; 16A.727; 38.18; 40A.15, subdivision 2; 69.011, subdivision 1; 69.021, 380.11subdivisions 7, 8; 88.51, subdivision 3; 103B.102, subdivision 3; 103B.245, 380.12subdivision 3; 103B.251, subdivision 8; 103B.335; 103B.3369, subdivision 5; 380.13103B.635, subdivision 2; 103B.691, subdivision 2; 103C.501, subdivision 4; 380.14103D.905, subdivisions 2, 3, 8; 103F.405, subdivision 1; 116J.8737, subdivisions 380.151, 2, 8; 117.025, subdivision 7; 118A.04, subdivision 3; 118A.05, subdivision 380.165; 123A.455, subdivision 1; 126C.10, subdivision 1, by adding a subdivision; 380.17126C.13, subdivision 4; 126C.17; 126C.48, subdivision 8; 127A.48, subdivision 380.181; 138.053; 144F.01, subdivision 4; 162.07, subdivisions 3, 4; 163.04, subdivision 380.193; 163.06, subdivision 6; 165.10, subdivision 1; 168.012, subdivision 9, by 380.20adding a subdivision; 216C.436, subdivision 7; 237.52, subdivision 3, by adding 380.21a subdivision; 270.077; 270.41, subdivisions 3, 5, by adding a subdivision; 380.22270.45; 270B.01, subdivision 8; 270B.03, subdivision 1; 270B.12, subdivision 380.234; 270C.03, subdivision 1; 270C.34, subdivision 1; 270C.38, subdivision 1; 380.24270C.42, subdivision 2; 270C.56, subdivision 1; 271.06, subdivision 2a, as added; 380.25272.01, subdivision 2; 272.02, subdivisions 39, 97, by adding subdivisions; 380.26272.03, subdivision 9, by adding subdivisions; 273.032; 273.061, subdivision 380.272; 273.0645; 273.11, subdivision 1; 273.114, subdivision 6; 273.117; 273.124, 380.28subdivisions 3a, 13; 273.13, subdivisions 21b, 23, 25; 273.1398, subdivisions 3, 380.294; 273.19, subdivision 1; 273.372, subdivision 4; 273.39; 275.011, subdivision 1; 380.30275.077, subdivision 2; 275.71, subdivision 4; 276.04, subdivision 2; 276A.01, 380.31subdivisions 10, 12, 13, 15; 276A.06, subdivision 10; 279.01, subdivision 1, by 380.32adding a subdivision; 279.02; 279.06, subdivision 1; 279.37, subdivisions 1a, 2; 380.33281.14; 281.17; 287.05, by adding a subdivision; 287.08; 287.20, by adding a 380.34subdivision; 287.23, subdivision 1; 287.385, subdivision 7; 289A.08, subdivision 380.353; 289A.10, subdivision 1, by adding a subdivision; 289A.12, subdivision 14, by 380.36adding a subdivision; 289A.18, by adding a subdivision; 289A.20, subdivisions 380.373, 4, by adding a subdivision; 289A.26, subdivisions 3, 4, 7, 9; 289A.55, 380.38subdivision 9; 289A.60, subdivision 4; 290.01, subdivisions 19, as amended, 380.3919b, 19c, 19d; 290.06, subdivisions 2c, 2d, by adding a subdivision; 290.0677, 380.40subdivision 2; 290.068, subdivisions 3, 6a; 290.0681, subdivisions 1, 3, 4, 5, 10; 380.41290.091, subdivisions 1, 2, 6; 290.0921, subdivision 3; 290.0922, subdivision 1; 380.42290.095, subdivision 2; 290.10, subdivision 1; 290.17, subdivision 4; 290.191, 380.43subdivision 5; 290.21, subdivision 4; 290.9705, subdivision 1; 290A.03, 380.44subdivision 3; 290A.04, subdivisions 2, 2a, 4; 290B.04, subdivision 2; 290C.02, 380.45subdivision 6; 290C.03; 290C.055; 290C.07; 291.005, subdivision 1; 291.03, 380.46subdivisions 1, 8, 9, 10, 11, by adding a subdivision; 296A.01, subdivisions 7, 8, 380.4714, 19, 20, 23, 24, 26, by adding a subdivision; 296A.09, subdivision 2; 296A.17, 380.48subdivision 3; 296A.22, subdivisions 1, 3; 297A.61, subdivisions 3, 4, 10, 25, 380.4938, 45, by adding subdivisions; 297A.64, subdivision 1; 297A.66, subdivision 380.503, by adding a subdivision; 297A.665; 297A.668, by adding a subdivision; 380.51297A.67, subdivisions 7, 13, by adding a subdivision; 297A.68, subdivisions 380.522, 5, 42, by adding a subdivision; 297A.70, subdivisions 2, 4, 5, 7, 13, 14, by 380.53adding subdivisions; 297A.71, by adding subdivisions; 297A.75, subdivisions 380.541, 2, 3; 297A.82, subdivision 4, by adding a subdivision; 297A.99, subdivision 380.551; 297B.11; 297E.021, subdivision 3; 297E.14, subdivision 7; 297F.01, 380.56subdivisions 3, 19, 23, by adding subdivisions; 297F.05, subdivisions 1, 3, 4, by 380.57adding subdivisions; 297F.09, subdivision 9; 297F.18, subdivision 7; 297F.24, 380.58subdivision 1; 297F.25, subdivision 1; 297G.04, subdivision 2; 297G.09, 381.1subdivision 8; 297G.17, subdivision 7; 297I.05, subdivisions 7, 11, 12; 297I.30, 381.2subdivisions 1, 2; 297I.80, subdivision 1; 298.01, subdivisions 3, 3b; 298.018; 381.3298.17; 298.227, as amended; 298.24, subdivision 1; 298.28, subdivisions 4, 6, 381.49c, 10; 325D.32, subdivision 2; 325F.781, subdivision 1; 349.166, subdivision 381.51; 353G.08, subdivision 2; 360.531; 360.66; 365.025, subdivision 4; 366.095, 381.6subdivision 1; 366.27; 368.01, subdivision 23; 368.47; 370.01; 373.01, 381.7subdivisions 1, 3; 373.40, subdivisions 1, 2, 4; 375.167, subdivision 1; 375.18, 381.8subdivision 3; 375.555; 383A.80, subdivision 4; 383B.152; 383B.245; 383B.73, 381.9subdivision 1; 383B.80, subdivision 4; 383D.41, by adding a subdivision; 381.10383E.20; 383E.23; 385.31; 394.36, subdivision 1; 398A.04, subdivision 8; 381.11401.05, subdivision 3; 403.02, subdivision 21, by adding subdivisions; 403.06, 381.12subdivision 1a; 403.11, subdivision 1, by adding subdivisions; 410.32; 412.221, 381.13subdivision 2; 412.301; 428A.02, subdivision 1; 428A.101; 428A.21; 430.102, 381.14subdivision 2; 447.10; 450.19; 450.25; 458A.10; 458A.31, subdivision 1; 465.04; 381.15469.033, subdivision 6; 469.034, subdivision 2; 469.053, subdivisions 4, 4a, 6; 381.16469.071, subdivision 5; 469.107, subdivision 1; 469.169, by adding a subdivision; 381.17469.176, subdivisions 4c, 4g, 6; 469.177, subdivisions 1a, 9, by adding 381.18subdivisions; 469.180, subdivision 2; 469.187; 469.206; 469.319, subdivision 381.194; 469.340, subdivision 4; 471.24; 471.571, subdivisions 1, 2; 471.73; 473.325, 381.20subdivision 2; 473.39, by adding a subdivision; 473.606, subdivision 3; 473.629; 381.21473.661, subdivision 3; 473.667, subdivision 9; 473.671; 473.711, subdivision 381.222a; 473F.02, subdivisions 12, 14, 15, 23; 473F.08, subdivisions 3a, 10, by adding 381.23a subdivision; 474A.04, subdivision 1a; 474A.062; 474A.091, subdivision 3a; 381.24475.521, subdivisions 1, 2, 4; 475.53, subdivisions 1, 3, 4; 475.58, subdivisions 381.252, 3b; 475.73, subdivision 1; 477A.011, subdivisions 20, 30, 34, 42, by adding 381.26subdivisions; 477A.0124, subdivision 2; 477A.013, subdivisions 1, 8, 9, by 381.27adding a subdivision; 477A.015; 477A.03, subdivisions 2a, 2b, by adding a 381.28subdivision; 477A.11, subdivisions 3, 4, by adding subdivisions; 477A.12, 381.29subdivisions 1, 2, 3; 477A.14, subdivision 1, by adding a subdivision; 641.23; 381.30641.24; 645.44, by adding a subdivision; Laws 1971, chapter 773, section 1, 381.31subdivision 2, as amended; Laws 1988, chapter 645, section 3, as amended; 381.32Laws 1993, chapter 375, article 9, section 46, subdivisions 2, as amended, 5, as 381.33amended; Laws 1998, chapter 389, article 8, section 43, subdivisions 1, 3, as 381.34amended, 5, as amended; Laws 1999, chapter 243, article 6, section 11; Laws 381.352002, chapter 377, article 3, section 25, as amended; Laws 2005, First Special 381.36Session chapter 3, article 5, section 37, subdivisions 2, 4; Laws 2006, chapter 381.37259, article 11, section 3, as amended; Laws 2008, chapter 366, article 5, sections 381.3826; 33; 34, as amended; article 7, section 19, subdivision 3, as amended; Laws 381.392009, chapter 88, article 2, section 46, subdivisions 1, 3; Laws 2010, chapter 216, 381.40sections 11; 55; Laws 2010, chapter 389, article 1, section 12; article 5, section 6, 381.41subdivision 6; proposing coding for new law in Minnesota Statutes, chapters 116J; 381.42116V; 124D; 136A; 270C; 287; 290A; 292; 403; 423A; 469; 477A; repealing 381.43Minnesota Statutes 2012, sections 16A.725; 97A.061; 256.9658; 272.69; 273.11, 381.44subdivisions 1a, 22; 276A.01, subdivision 11; 289A.60, subdivision 31; 290.01, 381.45subdivision 6b; 290.06, subdivision 22a; 290.0921, subdivision 7; 290.171; 381.46290.173; 290.174; 297A.61, subdivision 27; 297A.68, subdivision 35; 473F.02, 381.47subdivision 13; 477A.011, subdivisions 2a, 19, 21, 29, 31, 32, 33, 36, 39, 40, 41; 381.48477A.013, subdivisions 11, 12; 477A.0133; 477A.0134; Laws 1973, chapter 567, 381.49section 7, as amended; Laws 2009, chapter 88, article 4, section 23, as amended."

382.1We request the adoption of this report and repassage of the bill.382.2House Conferees:382.3
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                     						382.4Ann LenczewskiJim Davnie382.5
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                     						382.6Tom AnzelcJohn Benson382.7
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                     						382.8Kim Norton382.9Senate Conferees:382.10
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                     						382.11Rod SkoeAnn H. Rest382.12
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                     						382.13Kari DziedzicLyle Koenen382.14
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                     						382.15David H. Senjem