HF 625

as introduced - 80th Legislature (1997 - 1998) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act
  1.2             relating to property taxes; modifying the taconite tax 
  1.3             relief area fiscal disparities program; establishing 
  1.4             the tax base revitalization trust fund; amending 
  1.5             Minnesota Statutes 1996, sections 276A.05, 
  1.6             subdivisions 1 and 4; and 276A.06, subdivision 5, and 
  1.7             by adding a subdivision; proposing coding for new law 
  1.8             in Minnesota Statutes, chapter 276A. 
  1.9   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.10     Section 1.  Minnesota Statutes 1996, section 276A.05, 
  1.11  subdivision 1, is amended to read: 
  1.12     Subdivision 1.  [AREAWIDE NET TAX CAPACITY.] (a) Each 
  1.13  county auditor shall certify the determinations under sections 
  1.14  276A.03 and 276A.04 to the administrative auditor on or before 
  1.15  August 1 of each year.  The administrative auditor shall 
  1.16  determine an amount equal to 40 percent of the sum of the 
  1.17  amounts certified pursuant to section 276A.04.  The resulting 
  1.18  amount shall be known as the "areawide net tax capacity for 
  1.19  ........(year)."  One-half of the areawide net tax capacity 
  1.20  shall be the portion of the areawide net tax capacity available 
  1.21  for distribution; the remaining one-half shall be the areawide 
  1.22  net tax capacity dedicated to tax base revitalization. 
  1.23     (b) For taxes payable in 1998 and 1999 only, the entire 
  1.24  areawide net tax capacity shall be dedicated to tax base 
  1.25  revitalization. 
  1.26     (c) Once the trust fund established in section 276A.10 
  1.27  reaches a net asset value of $100,000,000, the entire areawide 
  2.1   net tax capacity shall be available for distribution in the next 
  2.2   taxes payable year and all future taxes payable years. 
  2.3      (d) In the event the $100,000,000 minimum condition in 
  2.4   paragraph (c) has not been met prior to taxes payable in 2018, 
  2.5   the relative portions of the areawide net tax capacity dedicated 
  2.6   to tax base revitalization and available for distribution shall 
  2.7   be determined according to the following schedule: 
  2.8     Taxes            Relative portion        Relative portion
  2.9    payable           available for tax         available for
  2.10    year            base revitalization        distribution
  2.11    2018                15 percent               25 percent
  2.12    2019                10 percent               30 percent
  2.13    2020                 5 percent               35 percent
  2.14    2021 and thereafter  0 percent               40 percent
  2.15     Sec. 2.  Minnesota Statutes 1996, section 276A.05, 
  2.16  subdivision 4, is amended to read: 
  2.17     Subd. 4.  [DISTRIBUTION NET TAX CAPACITY.] The 
  2.18  administrative auditor shall determine the proportion which the 
  2.19  index of each municipality bears to the sum of the indices of 
  2.20  all municipalities and shall then multiply this proportion in 
  2.21  the case of each municipality, by the portion of the areawide 
  2.22  net tax capacity available for distribution. 
  2.23     Sec. 3.  Minnesota Statutes 1996, section 276A.06, is 
  2.24  amended by adding a subdivision to read: 
  2.25     Subd. 3a.  [DISTRIBUTION TO TAX BASE REVITALIZATION 
  2.26  ACCOUNT.] An amount equal to the areawide tax rate multiplied by 
  2.27  the portion of the areawide net tax capacity dedicated to tax 
  2.28  base revitalization shall be annually placed in the tax base 
  2.29  revitalization trust fund under sections 276A.10 to 276A.15. 
  2.30     Sec. 4.  Minnesota Statutes 1996, section 276A.06, 
  2.31  subdivision 5, is amended to read: 
  2.32     Subd. 5.  [AREAWIDE TAX RATE.] (a) On or before August 25 
  2.33  of 1997 and each subsequent year, the county auditor shall 
  2.34  certify to the administrative auditor that portion of the levy 
  2.35  of each governmental unit determined pursuant to subdivision 3, 
  2.36  clause (a).  The administrative auditor shall then determine the 
  2.37  areawide tax rate sufficient to yield an amount equal to the sum 
  3.1   of the levies from the portion of the areawide net tax capacity 
  3.2   available for distribution.  On or before September 1, the 
  3.3   administrative auditor shall certify the areawide tax rate to 
  3.4   each of the county auditors. 
  3.5      (b) For taxes payable in 1998 and 1999, the areawide tax 
  3.6   rate is 120 percent. 
  3.7      Sec. 5.  [276A.10] [TAX BASE REVITALIZATION TRUST FUND.] 
  3.8      Subdivision 1.  [PURPOSES.] The tax base revitalization 
  3.9   trust fund is hereby created to be devoted to economic 
  3.10  revitalization and diversification of industrial enterprises in 
  3.11  the tax relief area defined in section 276A.01, subdivision 2.  
  3.12  Priority shall be given to using the tax base revitalization 
  3.13  trust fund for the following purposes: 
  3.14     (1) projects and programs that are designed to create and 
  3.15  maintain productive, permanent, skilled employment, including 
  3.16  employment in technologically innovative businesses; 
  3.17     (2) projects and programs to encourage diversification of 
  3.18  the economy and to promote the development of minerals, 
  3.19  alternative energy sources utilizing indigenous fuels, forestry, 
  3.20  small business, and tourism; and 
  3.21     (3) projects and programs for which technological and 
  3.22  economic feasibility have been demonstrated. 
  3.23     Subd. 2.  [USE OF MONEY.] Money in the tax base 
  3.24  revitalization trust fund may be used to provide loans, loan 
  3.25  guarantees, interest buy-downs and other forms of participation 
  3.26  with private sources of financing, but a loan to a private 
  3.27  enterprise shall be for a principal amount not to exceed 
  3.28  one-half of the cost of the project for which financing is 
  3.29  sought, and the rate of interest on a loan shall be no less than 
  3.30  the lesser of eight percent or an interest rate three percentage 
  3.31  points less than a full faith and credit obligation of the 
  3.32  United States government of comparable maturity, at the time 
  3.33  that the loan is approved. 
  3.34     Money from the fund shall be expended only in or for the 
  3.35  benefit of the area defined in section 276A.01, subdivision 2. 
  3.36     Sec. 6.  [276A.11] [EXPENDING FUNDS.] 
  4.1      Tax base revitalization trust fund money shall be expended 
  4.2   only in an amount that does not exceed the sum of the net 
  4.3   interest, dividends, and earnings arising from the investment of 
  4.4   the trust for the preceding 12 calendar months from the date of 
  4.5   the authorization. 
  4.6      Sec. 7.  [276A.12] [INVESTMENT OF FUND.] 
  4.7      The trust fund established by section 276A.10 shall be 
  4.8   invested pursuant to law by the state board of investment and 
  4.9   the net interest, dividends, and other earnings arising from the 
  4.10  investments shall be transferred on the first day of each month 
  4.11  to the trust and shall be included and become part of the trust 
  4.12  fund.  The amounts transferred are appropriated from the trust 
  4.13  fund to the commissioner of iron range resources and 
  4.14  rehabilitation for deposit in a separate account for expenditure 
  4.15  for the purposes set forth in section 276A.10.  Amounts 
  4.16  appropriated pursuant to this section shall not cancel but shall 
  4.17  remain available unless expended. 
  4.18     Sec. 8.  [276A.13] [OPERATION OF FUND.] 
  4.19     Subdivision 1.  [PROJECT APPROVAL.] The board shall by 
  4.20  August 1 of each year prepare a list of projects to be funded 
  4.21  from the tax base revitalization trust with necessary supporting 
  4.22  information including description of the projects, plans, and 
  4.23  cost estimates.  These projects shall be consistent with the 
  4.24  priorities established in section 276A.10 and shall not be 
  4.25  approved by the board unless it finds that: 
  4.26     (a) the project will materially assist, directly or 
  4.27  indirectly, the creation of additional property tax base; 
  4.28     (b) the prospective benefits of the expenditure exceed the 
  4.29  anticipated costs; and 
  4.30     (c) in the case of assistance to private enterprise, the 
  4.31  project will serve a sound business purpose. 
  4.32     To be proposed by the board, a project must be approved by 
  4.33  at least eight iron range resources and rehabilitation board 
  4.34  members and the commissioner of iron range resources and 
  4.35  rehabilitation.  The list of projects shall be submitted to the 
  4.36  governor, who shall, by November 15 of each year, approve or 
  5.1   disapprove, or return for further consideration, each project.  
  5.2   The money for a project may be expended only upon approval of 
  5.3   the project by the governor.  The board may submit supplemental 
  5.4   projects for approval at any time. 
  5.5      Subd. 2.  [EXPENDITURE OF FUNDS.] Until the year 2022, or 
  5.6   until the condition described in section 276A.05, subdivision 1, 
  5.7   paragraph (c), is reached, whichever comes first, funds may be 
  5.8   expended on projects and for administration of the trust fund 
  5.9   only from the net interest, earnings, and dividends arising from 
  5.10  the investment of the trust at any time.  After that, funds may 
  5.11  be expended on projects and for administration from any assets 
  5.12  of the trust.  Annual administrative costs, not including 
  5.13  detailed engineering expenses for the projects, shall not exceed 
  5.14  five percent of the net interest, dividends, and earnings 
  5.15  arising from the trust in the preceding fiscal year. 
  5.16     Principal and interest received in repayment of loans made 
  5.17  pursuant to this section shall be deposited in the state 
  5.18  treasury and credited to the trust.  These receipts are 
  5.19  appropriated to the board for the purposes of sections 276A.10 
  5.20  to 276A.15. 
  5.21     Subd. 3.  [ADMINISTRATION.] The commissioner and staff of 
  5.22  the iron range resources and rehabilitation board shall 
  5.23  administer the program under which funds are expended pursuant 
  5.24  to sections 276A.10 to 276A.15. 
  5.25     Sec. 9.  [276A.14] [ADVISORY COMMITTEES.] 
  5.26     Before submission of a project to the board, the 
  5.27  commissioner of iron range resources and rehabilitation shall 
  5.28  appoint a technical advisory committee consisting of one or more 
  5.29  persons who are knowledgeable in areas related to the objectives 
  5.30  of the proposal.  Members of the committees shall be compensated 
  5.31  as provided in section 15.059, subdivision 3.  The board shall 
  5.32  not act on a proposal until it has received the evaluation and 
  5.33  recommendations of the technical advisory committee or until 15 
  5.34  days have elapsed since the proposal was transmitted to the 
  5.35  advisory committee, whichever occurs first. 
  5.36     Sec. 10.  [276A.15] [LONG-RANGE PLAN.] 
  6.1      Consistent with the policy established in sections 276A.10 
  6.2   to 276A.15, the iron range resources and rehabilitation board 
  6.3   shall prepare and present to the governor and the legislature by 
  6.4   January 1, 2002, a long-range plan for the use of the tax base 
  6.5   revitalization trust fund for the economic development and 
  6.6   diversification of the area defined in section 276A.01, 
  6.7   subdivision 2.  The iron range resources and rehabilitation 
  6.8   board shall, before November 15 of each even-numbered year after 
  6.9   2002, prepare a report to the governor and legislature updating 
  6.10  and revising this long-range plan and reporting on the iron 
  6.11  range resources and rehabilitation board's progress on those 
  6.12  matters assigned to it by law.  No project shall be approved by 
  6.13  the iron range resources and rehabilitation board which is not 
  6.14  consistent with the goals and objectives established in the 
  6.15  long-range plan. 
  6.16     Sec. 11.  [EFFECTIVE DATE.] 
  6.17     This act is effective the day following final enactment.