{\rtf1\ansi\deff0{\fonttbl{\f0 Times New Roman;}}\margl480\margr0\margt0\margb0\fs20\n\line \line\n\line \line\n\line \line\n\line {\pard\n\line \n\line \n\line 1.1 A bill for an act \n\line 1.2 relating to taxation; sales and use; exempting sales \n\line 1.3 to political subdivisions of a state; amending \n\line 1.4 Minnesota Statutes 2000, sections 297A.70, \n\line 1.5 subdivisions 1, 2, and 3; and 297A.991, subdivision 2. \n\line 1.6 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: \n\line 1.7 Section 1. Minnesota Statutes 2000, section 297A.70, \n\line 1.8 subdivision 1, is amended to read: \n\line 1.9 Subdivision 1. [SCOPE.] (a) The gross receipts from sales \n\line 1.10 of items to or by, and storage, distribution, use, or \n\line 1.11 consumption of items by the organizations listed in this section \n\line 1.12 are specifically exempted from the taxes imposed by this chapter.\n\line 1.13 (b) {\strike Notwithstanding any law to the contrary enacted before} \n\line 1.14 {\strike 1992, only sales to governments and political subdivisions} \n\line 1.15 {\strike listed in this section are exempt from the taxes imposed by this} \n\line 1.16 {\strike chapter.} \n\line 1.17 {\strike (c)} "Sales" includes purchases under an installment \n\line 1.18 contract or lease purchase agreement under section 465.71. \n\line 1.19 [EFFECTIVE DATE.] {\ul This section is effective for sales and} \n\line 1.20 {\ul purchases after June 30, 2001.} \n\line 1.21 Sec. 2. Minnesota Statutes 2000, section 297A.70, \n\line 1.22 subdivision 2, is amended to read: \n\line 1.23 Subd. 2. [SALES TO GOVERNMENT.] (a) All sales, except \n\line 1.24 those listed in paragraph (b), to the following governments and \n\line 1.25 political subdivisions, or to the listed agencies or \n\line 2.1 instrumentalities of governments and political subdivisions, are \n\line 2.2 exempt: \n\line 2.3 (1) the United States and its agencies and \n\line 2.4 instrumentalities; \n\line 2.5 (2) {\strike school districts,} the University of Minnesota, state \n\line 2.6 universities, community colleges, technical colleges, state \n\line 2.7 academies, {\ul and} the Perpich Minnesota center for arts education{\strike ,} \n\line 2.8 {\strike and an instrumentality of a political subdivision that is} \n\line 2.9 {\strike accredited as an optional/special function school by the North} \n\line 2.10 {\strike Central Association of Colleges and Schools}; \n\line 2.11 (3) {\strike hospitals and nursing homes owned and operated by} \n\line 2.12 {\strike political subdivisions of the state} {\ul political subdivisions of a} \n\line 2.13 {\ul state and their agencies and instrumentalities}; {\ul and} \n\line 2.14 (4) {\strike other states or political subdivisions of other states,} \n\line 2.15 {\strike if the sale would be exempt from taxation if it occurred in that} \n\line 2.16 {\strike state; and} \n\line 2.17 {\strike (5)} sales to public libraries, public library systems, \n\line 2.18 multicounty, multitype library systems as defined in section \n\line 2.19 134.001, {\strike county law libraries under chapter 134A,} state agency \n\line 2.20 libraries, the state library under section 480.09, and the \n\line 2.21 legislative reference library. \n\line 2.22 (b) This exemption does not apply to the sales of the \n\line 2.23 following products and services: \n\line 2.24 (1) building, construction, or reconstruction materials \n\line 2.25 purchased by a contractor or a subcontractor as a part of a \n\line 2.26 lump-sum contract or similar type of contract with a guaranteed \n\line 2.27 maximum price covering both labor and materials for use in the \n\line 2.28 construction, alteration, or repair of a building or facility; \n\line 2.29 (2) construction materials purchased by tax exempt entities \n\line 2.30 or their contractors to be used in constructing buildings or \n\line 2.31 facilities which will not be used principally by the tax exempt \n\line 2.32 entities; \n\line 2.33 (3) the leasing of a motor vehicle as defined in section \n\line 2.34 297B.01, subdivision 5, except for{\ul : (i)} leases entered into by \n\line 2.35 the United States or its agencies or instrumentalities {\ul or (ii)} \n\line 2.36 {\ul leases entered into by a political subdivision of motor vehicles} \n\line 3.1 {\ul exempt from tax under chapter 297B}; or \n\line 3.2 (4) meals and lodging as defined under section 297A.61, \n\line 3.3 subdivisions 3, paragraph (d), and 16, paragraph (c), except for \n\line 3.4 meals and lodging purchased directly by the United States or its \n\line 3.5 agencies or instrumentalities. \n\line 3.6 {\strike (c) As used in this subdivision, "school districts" means} \n\line 3.7 {\strike public school entities and districts of every kind and nature} \n\line 3.8 {\strike organized under the laws of the state of Minnesota, and any} \n\line 3.9 {\strike instrumentality of a school district, as defined in section} \n\line 3.10 {\strike 471.59.} \n\line 3.11 [EFFECTIVE DATE.] {\ul This section is effective for sales and} \n\line 3.12 {\ul purchases after June 30, 2001.} \n\line 3.13 Sec. 3. Minnesota Statutes 2000, section 297A.70, \n\line 3.14 subdivision 3, is amended to read: \n\line 3.15 Subd. 3. [SALES OF CERTAIN GOODS AND SERVICES TO \n\line 3.16 GOVERNMENT.] (a) The following sales to or use by the specified \n\line 3.17 {\ul persons,} governments{\ul ,} and political subdivisions of the state \n\line 3.18 are exempt: \n\line 3.19 (1) {\strike supplies and equipment used to provide medical care in} \n\line 3.20 {\strike the operation of an ambulance service owned and operated by a} \n\line 3.21 {\strike political subdivision of the state;} \n\line 3.22 {\strike (2) repair and replacement parts for emergency rescue} \n\line 3.23 {\strike vehicles, fire trucks, and fire apparatus to a political} \n\line 3.24 {\strike subdivision;} \n\line 3.25 {\strike (3) machinery and equipment, except for motor vehicles,} \n\line 3.26 {\strike used directly for mixed municipal solid waste management} \n\line 3.27 {\strike services at a solid waste disposal facility as defined in} \n\line 3.28 {\strike section 115A.03, subdivision 10;} \n\line 3.29 {\strike (4) chore and homemaking services to a political} \n\line 3.30 {\strike subdivision of the state to be provided to elderly or disabled} \n\line 3.31 {\strike individuals;} \n\line 3.32 {\strike (5)} telephone services to the department of administration \n\line 3.33 that are used to provide telecommunications services through the \n\line 3.34 intertechnologies revolving fund; \n\line 3.35 {\strike (6)} {\ul (2)} firefighter personal protective equipment as \n\line 3.36 defined in paragraph (b), if purchased or authorized by and for \n\line 4.1 the use of an organized fire department, fire protection \n\line 4.2 district, or fire company regularly charged with the \n\line 4.3 responsibility of providing fire protection to the state or a \n\line 4.4 political subdivision; \n\line 4.5 {\strike (7)} {\ul (3)} bullet-resistant body armor that provides the \n\line 4.6 wearer with ballistic and trauma protection, if purchased by a \n\line 4.7 law enforcement agency of the state {\strike or a political subdivision} \n\line 4.8 {\strike of the state,} or a licensed peace officer, as defined in section \n\line 4.9 626.84, subdivision 1; {\ul and} \n\line 4.10 {\strike (8)} {\ul (4)} motor vehicles purchased or leased by political \n\line 4.11 subdivisions of the state if the vehicles are exempt from \n\line 4.12 registration under section 168.012, subdivision 1, paragraph \n\line 4.13 (b), or exempt from taxation under section 473.448; \n\line 4.14 {\strike (9) equipment designed to process, dewater, and recycle} \n\line 4.15 {\strike biosolids for wastewater treatment facilities of political} \n\line 4.16 {\strike subdivisions, and materials incidental to installation of that} \n\line 4.17 {\strike equipment; and materials used to construct buildings to house} \n\line 4.18 {\strike the equipment, if the materials are purchased after June 30,} \n\line 4.19 {\strike 1998, and before July 1, 2001; and} \n\line 4.20 {\strike (10) sales to a town of gravel and of machinery, equipment,} \n\line 4.21 {\strike and accessories, except motor vehicles, used exclusively for} \n\line 4.22 {\strike road and bridge maintenance, and leases by a town of motor} \n\line 4.23 {\strike vehicles exempt from tax under section 297B.03, clause (10).} \n\line 4.24 (b) For purposes of this subdivision, "firefighters \n\line 4.25 personal protective equipment" means helmets, including face \n\line 4.26 shields, chin straps, and neck liners; bunker coats and pants, \n\line 4.27 including pant suspenders; boots; gloves; head covers or hoods; \n\line 4.28 wildfire jackets; protective coveralls; goggles; self-contained \n\line 4.29 breathing apparatus; canister filter masks; personal alert \n\line 4.30 safety systems; spanner belts; optical or thermal imaging search \n\line 4.31 devices; and all safety equipment required by the Occupational \n\line 4.32 Safety and Health Administration. \n\line 4.33 [EFFECTIVE DATE.] {\ul This section is effective for sales and} \n\line 4.34 {\ul purchases after June 30, 2001.} \n\line 4.35 Sec. 4. Minnesota Statutes 2000, section 297A.991, \n\line 4.36 subdivision 2, is amended to read: \n\line 5.1 Subd. 2. [COMMISSIONER OF FINANCE TO REPORT.] In reporting \n\line 5.2 the sales tax and sales tax on motor vehicles collections to the \n\line 5.3 United States Department of Commerce, the commissioner of \n\line 5.4 finance shall exclude the estimated amount from the sales and \n\line 5.5 motor vehicle collections. {\strike Sales tax and} Sales tax on motor \n\line 5.6 vehicles revenues received from political subdivisions must be \n\line 5.7 reported as intergovernmental grants or similar \n\line 5.8 intergovernmental revenue. The amount of the sales tax and \n\line 5.9 sales tax on motor vehicles paid by state agencies must be \n\line 5.10 reported as reduced state expenditures. \n\line 5.11 [EFFECTIVE DATE.] {\ul This section is effective for sales and} \n\line 5.12 {\ul purchases after June 30, 2001.}\n\line \n\line \par}
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