HF 1545

as introduced - 79th Legislature (1995 - 1996) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act
  1.2             relating to financing and operation of government in 
  1.3             Minnesota; changing property tax classifications and 
  1.4             class rates; modifying the property tax refund for 
  1.5             homeowners and renters; restructuring various state 
  1.6             aids; changing the local government aid formula; 
  1.7             providing state financing of court administration 
  1.8             employees; providing for three property tax 
  1.9             installment payments; allowing cities to impose 
  1.10            certain service charges on certain tax exempt 
  1.11            property; appropriating money; amending Minnesota 
  1.12            Statutes 1994, sections 43A.02, subdivision 25; 
  1.13            43A.24, subdivision 2; 97A.065, subdivision 2; 
  1.14            124.226, subdivision 1; 124A.23, subdivision 1; 
  1.15            145A.13, subdivision 2; 256E.06, subdivisions 5 and 
  1.16            12; 273.1316, subdivisions 1, 6, and 7; 273.1398, 
  1.17            subdivisions 2 and 3; 275.065, subdivision 3; 275.07, 
  1.18            subdivision 1; 275.08, subdivision 1b; 276.04, 
  1.19            subdivision 3; 276.09; 276.10; 276.11, subdivision 1; 
  1.20            276.111; 278.03, subdivision 1; 278.05, subdivision 5; 
  1.21            279.01, by adding subdivisions; 289A.18, subdivision 
  1.22            5; 289A.56, subdivision 6; 290A.01; 290A.03, 
  1.23            subdivisions 6 and 13; 290A.04, subdivision 2, and by 
  1.24            adding a subdivision; 290A.07; 290A.23, subdivision 3; 
  1.25            299D.03, subdivision 5; 466.01, subdivision 6; 
  1.26            477A.011, subdivisions 34, 37, and by adding 
  1.27            subdivisions; 477A.013, subdivisions 8 and 9; 477A.03, 
  1.28            subdivisions 1 and 2; 480.181, subdivision 1; 485.01; 
  1.29            485.018, subdivisions 2a, 5, and 6; 485.021; 487.32, 
  1.30            subdivision 3; and 574.34, subdivision 1; proposing 
  1.31            coding for new law in Minnesota Statutes, chapters 
  1.32            124A; 273; 275; 290A; and 429; repealing Minnesota 
  1.33            Statutes 1994, sections 256E.06, subdivision 2; 
  1.34            273.124; 273.13; 273.1398; 275.08, subdivisions 1c and 
  1.35            1d; 279.01, subdivisions 1 and 3; 290A.04, 
  1.36            subdivisions 2a, 2b, 2h, and 2i; 290A.23, subdivisions 
  1.37            1 and 2; 485.018, subdivisions 1, 2, 4, and 8; 485.03; 
  1.38            485.05; 485.11. 
  1.39  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.40                             ARTICLE 1 
  1.41             PROPERTY TAX CLASSIFICATION AND VALUATION 
  1.42     Section 1.  [273.126] [DEFINITIONS.] 
  2.1      Subdivision 1.  [APPLICATION.] The definitions listed in 
  2.2   subdivisions 2 to 12 must be used in classifying property under 
  2.3   section 273.126. 
  2.4      Subd. 2.  [CLASS RATE.] Wherever the "class rate" of a 
  2.5   class of property is specified without qualification as to 
  2.6   whether it is the property's "net class rate" or its "gross 
  2.7   class rate," the "net class rate" and "gross class rate" of that 
  2.8   property are the same as its "class rate." 
  2.9      Subd. 3.  [NET TAX CAPACITY.] "Net tax capacity" means the 
  2.10  product of the appropriate class rate multiplied by the market 
  2.11  value of the property. 
  2.12     Subd. 4.  [RESIDENTIAL PROPERTY.] "Residential property" 
  2.13  means: 
  2.14     (1) a property containing one, two, or three dwelling 
  2.15  units; 
  2.16     (2) subsidized housing; 
  2.17     (3) nonsubsidized residential property containing four or 
  2.18  more dwelling units; 
  2.19     (4) hospitals defined in section 144.50, subdivision 2; 
  2.20     (5) seasonal residential recreational property used for 
  2.21  noncommercial purposes; and 
  2.22     (6) seasonal residential recreational property used for 
  2.23  commercial purposes for up to 250 days in the year preceding the 
  2.24  year of assessment. 
  2.25     For purposes of this subdivision, property is devoted to a 
  2.26  commercial purpose on a specific day if any portion of the 
  2.27  property is used for residential occupancy and a fee is charged 
  2.28  for residential occupancy. 
  2.29     Subd. 5.  [AGRICULTURAL LAND.] "Agricultural land" means 
  2.30  contiguous acreage of ten acres or more, primarily used during 
  2.31  the preceding year for agricultural purposes.  Agricultural land 
  2.32  may include pasture, timber, waste, unusable wild land, and land 
  2.33  included in state or federal farm programs, and woodland 
  2.34  contiguous to or surrounded by agricultural land. 
  2.35     Subd. 6.  [AGRICULTURAL PURPOSES.] "Agricultural purposes" 
  2.36  means the raising or cultivation of agricultural products, 
  3.1   including:  (1) livestock, dairy animals, dairy products, 
  3.2   poultry and poultry products, fur-bearing animals, horticultural 
  3.3   and nursery stock described in sections 18.44 to 18.61, fruit of 
  3.4   all kinds, vegetables, forage, grains, bees, and apiary products 
  3.5   produced by the owner; (2) fish bred for sale and consumption if 
  3.6   the fish breeding occurs on land zoned for agricultural use; (3) 
  3.7   the commercial boarding of horses if the boarding is done in 
  3.8   conjunction with the raising or cultivation of agricultural 
  3.9   products as defined in clause (1); (4) property which is owned 
  3.10  and operated by nonprofit organizations used for equestrian 
  3.11  activities, excluding racing; and (5) game birds and waterfowl 
  3.12  bred and raised for use on a shooting preserve licensed under 
  3.13  section 97A.115.  
  3.14     If a parcel used for agricultural purposes is also used for 
  3.15  commercial or industrial purposes, including but not limited to: 
  3.16  (i) wholesale and retail sales; (ii) processing of raw 
  3.17  agricultural products or other goods; (iii) warehousing or 
  3.18  storage of processed goods; and (iv) office facilities for the 
  3.19  support of the activities enumerated in items (i), (ii), and 
  3.20  (iii); the assessor shall classify that portion of the parcel 
  3.21  used for agricultural purposes as class 1, and the remainder of 
  3.22  the property as commercial or industrial.  The first $100,000 
  3.23  market value of the commercial or industrial portion shall be 
  3.24  class 2 and the commercial or industrial market value in excess 
  3.25  of $100,000 shall be class 3.  The grading, sorting, and 
  3.26  packaging of raw agricultural products for first sale is 
  3.27  considered an agricultural purpose.  A greenhouse or other 
  3.28  building where horticultural or nursery products are grown that 
  3.29  is also used for the conduct of retail sales must be classified 
  3.30  as agricultural if it is primarily used for the growing of 
  3.31  horticultural or nursery products from seed, cuttings, or roots 
  3.32  and occasionally as a showroom for the retail sale of those 
  3.33  products.  Use of a greenhouse or building only for the display 
  3.34  of already grown horticultural or nursery products does not 
  3.35  qualify as an agricultural purpose.  
  3.36     The assessor shall determine and list separately on the 
  4.1   records the market value of any residential dwelling and the one 
  4.2   acre of land on which that dwelling is located.  If any farm 
  4.3   buildings or structures are located on this acre of land, their 
  4.4   market value shall not be included in this separate 
  4.5   determination.  
  4.6      Subd. 7.  [TIMBERLAND PROPERTY.] "Timberland property" is 
  4.7   real estate, rural in character and used exclusively for growing 
  4.8   trees for timber, lumber, and wood and wood products. 
  4.9      Subd. 8.  [SUBSIDIZED HOUSING.] "Subsidized housing" means: 
  4.10     (a) a structure that is:  
  4.11     (i) situated on real property that is used for housing for 
  4.12  the elderly or for low- and moderate-income families as defined 
  4.13  in Title II, as amended through December 31, 1990, of the 
  4.14  National Housing Act or the Minnesota housing finance agency law 
  4.15  of 1971, as amended, or rules promulgated by the agency and 
  4.16  financed by a direct federal loan or federally insured loan made 
  4.17  pursuant to Title II of the Act; or 
  4.18     (ii) situated on real property that is used for housing the 
  4.19  elderly or for low- and moderate-income families as defined by 
  4.20  the Minnesota housing finance agency law of 1971, as amended, or 
  4.21  rules adopted by the agency pursuant thereto and financed by a 
  4.22  loan made by the Minnesota housing finance agency pursuant to 
  4.23  the provisions of the act.  
  4.24     This clause applies only to property of a nonprofit or 
  4.25  limited dividend entity.  Property is classified under this 
  4.26  clause for 15 years from the date of the completion of the 
  4.27  original construction or substantial rehabilitation, or for the 
  4.28  original term of the loan.  
  4.29     (b) a structure that is: 
  4.30     (i) situated upon real property that is used for housing 
  4.31  lower income families or elderly or handicapped persons, as 
  4.32  defined in section 8 of the United States Housing Act of 1937, 
  4.33  as amended; and 
  4.34     (ii) owned by an entity which has entered into a housing 
  4.35  assistance payments contract under section 8 which provides 
  4.36  assistance for 100 percent of the dwelling units in the 
  5.1   structure, other than dwelling units intended for management or 
  5.2   maintenance personnel.  Property is classified under this clause 
  5.3   for the term of the housing assistance payments contract, 
  5.4   including all renewals, or for the term of its permanent 
  5.5   financing, whichever is shorter; 
  5.6      (c) a qualified low-income building as defined in section 
  5.7   42(c)(2) of the Internal Revenue Code of 1986, as amended 
  5.8   through December 31, 1990, that (i) receives a low-income 
  5.9   housing credit under section 42 of the Internal Revenue Code of 
  5.10  1986, as amended through December 31, 1990; or (ii) meets the 
  5.11  requirements of that section and receives public financing, 
  5.12  except financing provided under sections 469.174 to 469.179, 
  5.13  which contains terms restricting the rents; or (iii) meets the 
  5.14  requirements of section 273.1317.  Classification under this 
  5.15  clause is limited to a term of 15 years.  The public financing 
  5.16  received must be from at least one of the following sources:  
  5.17  government issued bonds exempt from taxes under section 103 of 
  5.18  the Internal Revenue Code of 1986, as amended through December 
  5.19  31, 1993, the proceeds of which are used for the acquisition or 
  5.20  rehabilitation of the building; programs under section 
  5.21  221(d)(3), 202, or 236, of Title II of the National Housing Act; 
  5.22  rental housing program funds under Section 8 of the United 
  5.23  States Housing Act of 1937, or the market rate family graduated 
  5.24  payment mortgage program funds administered by the Minnesota 
  5.25  housing finance agency that are used for the acquisition or 
  5.26  rehabilitation of the building; public financing provided by a 
  5.27  local government used for the acquisition or rehabilitation of 
  5.28  the building, including grants or loans from federal community 
  5.29  development block grants, HOME block grants, or residential 
  5.30  rental bonds issued under chapter 474A; or other rental housing 
  5.31  program funds provided by the Minnesota housing finance agency 
  5.32  for the acquisition or rehabilitation of the building. 
  5.33     For all properties described in clauses (a), (b), (c), and 
  5.34  (e), the market value determined by the assessor must be based 
  5.35  on the normal approach to value using normal unrestricted rents 
  5.36  unless the owner of the property elects to have the property 
  6.1   assessed under Laws 1991, chapter 291, article 1, section 55.  
  6.2   If the owner of the property elects to have the market value 
  6.3   determined on the basis of the actual restricted rents, as 
  6.4   provided in Laws 1991, chapter 291, article 1, section 55, the 
  6.5   property will be assessed at the same rate as class 4a or 4b, 
  6.6   whichever is appropriate, was receiving under Minnesota Statutes 
  6.7   1994.  Properties described in paragraphs (a), (c), and (e) may 
  6.8   apply to the assessor for valuation under Laws 1991, chapter 
  6.9   291, article 1, section 55.  The land on which these structures 
  6.10  are situated has the class rate given in subdivision 4, clause 
  6.11  (1), if the structure contains fewer than four units, and the 
  6.12  class rate given in subdivision 4, clause (3), if the structure 
  6.13  contains four or more units.  This clause applies only to the 
  6.14  property of a nonprofit or limited dividend entity.  
  6.15     (d) a parcel of land, not to exceed one acre, and its 
  6.16  improvements or a parcel of unimproved land, not to exceed one 
  6.17  acre, if it is owned by a neighborhood real estate trust and at 
  6.18  least 60 percent of the dwelling units, if any, on all land 
  6.19  owned by the trust are leased to or occupied by lower income 
  6.20  families or individuals.  This clause does not apply to any 
  6.21  portion of the land or improvements used for nonresidential 
  6.22  purposes.  For purposes of this clause, a lower income family is 
  6.23  a family with an income that does not exceed 65 percent of the 
  6.24  median family income for the area, and a lower income individual 
  6.25  is an individual whose income does not exceed 65 percent of the 
  6.26  median individual income for the area, as determined by the 
  6.27  United States Secretary of Housing and Urban Development.  For 
  6.28  purposes of this clause, "neighborhood real estate trust" means 
  6.29  an entity which is certified by the governing body of the 
  6.30  municipality in which it is located to have the following 
  6.31  characteristics: 
  6.32     (i) it is a nonprofit corporation organized under chapter 
  6.33  317A; 
  6.34     (ii) it has as its principal purpose providing housing for 
  6.35  lower income families in a specific geographic community 
  6.36  designated in its articles or bylaws; 
  7.1      (iii) it limits membership with voting rights to residents 
  7.2   of the designated community; and 
  7.3      (iv) it has a board of directors consisting of at least 
  7.4   seven directors, 60 percent of whom are members with voting 
  7.5   rights and, to the extent feasible, 25 percent of whom are 
  7.6   elected by resident members of buildings owned by the trust; 
  7.7      (e) a structure that is: 
  7.8      (i) situated on real property that is used for housing for 
  7.9   the elderly or for low- and moderate-income families as defined 
  7.10  by the Farmers Home Administration; 
  7.11     (ii) located in a municipality of less than 10,000 
  7.12  population; and 
  7.13     (iii) financed by a direct loan or insured loan from the 
  7.14  Farmers Home Administration.  Property is classified under this 
  7.15  clause for 15 years from the date of the completion of the 
  7.16  original construction or for the original term of the loan.  
  7.17     The class rates in clauses (a), items (1) and (2), and (c), 
  7.18  and this clause apply to the properties described in them, only 
  7.19  in proportion to occupancy of the structure by elderly or 
  7.20  handicapped persons or low- and moderate-income families as 
  7.21  defined in the applicable laws unless construction of the 
  7.22  structure had been commenced prior to January 1, 1984; or the 
  7.23  project had been approved by the governing body of the 
  7.24  municipality in which it is located prior to June 30, 1983; or 
  7.25  financing of the project had been approved by a federal or state 
  7.26  agency prior to June 30, 1983.  For those properties, the 
  7.27  classification provided in Minnesota Statutes 1994, section 
  7.28  273.13, for class 4c or 4d property is available only for those 
  7.29  units meeting the requirements of section 273.1318. 
  7.30     Classification under this clause is only available to 
  7.31  property of a nonprofit or limited dividend entity. 
  7.32     In the case of a structure financed or refinanced under any 
  7.33  federal or state mortgage insurance or direct loan program 
  7.34  exclusively for housing for the elderly or for housing for the 
  7.35  handicapped, a unit shall be considered occupied so long as it 
  7.36  is actually occupied by an elderly or handicapped person or, if 
  8.1   vacant, is held for rental to an elderly or handicapped person; 
  8.2   and 
  8.3      (f) qualifying buildings and appurtenances, together with 
  8.4   the land upon which they are located, leased for a period of up 
  8.5   to five years by the occupant under a lease-purchase program 
  8.6   administered by the Minnesota housing finance agency or a 
  8.7   housing and redevelopment authority authorized under sections 
  8.8   469.001 to 469.047, provided the occupant's income is no greater 
  8.9   than 80 percent of the county or area median income, adjusted 
  8.10  for family size, and the building consists of two or less 
  8.11  dwelling units.  The lease agreement must provide for a portion 
  8.12  of the lease payment to be escrowed as a nonrefundable down 
  8.13  payment on the housing.  The administering agency shall verify 
  8.14  the occupant's income eligibility and certify to the county 
  8.15  assessor that the occupant meets the income criteria under this 
  8.16  clause.  To qualify under this clause, the taxpayer must apply 
  8.17  to the county assessor by May 30 of each year.  For purposes of 
  8.18  this section, "qualifying buildings and appurtenances" is 
  8.19  defined as one or two unit residential buildings which are 
  8.20  unoccupied and have been abandoned and boarded for at least six 
  8.21  months. 
  8.22     Subd. 9.  [SEASONAL RESIDENTIAL RECREATIONAL 
  8.23  PROPERTY.] "Seasonal residential recreational property" is 
  8.24     (1) real property devoted to temporary and seasonal 
  8.25  residential occupancy for recreation purposes; and 
  8.26     (2) real property devoted to temporary and seasonal 
  8.27  residential occupancy for recreation purposes and not devoted to 
  8.28  commercial purposes for more than 250 days in the year preceding 
  8.29  the year of assessment. 
  8.30     For purposes of clause (2), property is devoted to a 
  8.31  commercial purpose on a specific day if any portion of the 
  8.32  property is used for residential occupancy, and a fee is charged 
  8.33  for residential occupancy.  Clause (2) also includes commercial 
  8.34  use real property used exclusively for recreational purposes, up 
  8.35  to a total of two acres, provided the property is not devoted to 
  8.36  commercial recreational use for more than 250 days in the year 
  9.1   preceding the year of assessment and is located within two miles 
  9.2   of the seasonal residential property with which it is used. 
  9.3      Owners of real property devoted to temporary and seasonal 
  9.4   residential occupancy for recreation purposes and all or a 
  9.5   portion of which was devoted to commercial purposes for not more 
  9.6   than 250 days in the year preceding the year of assessment 
  9.7   desiring a class 1 classification, must submit a declaration to 
  9.8   the assessor designating the cabins or units occupied for 250 
  9.9   days or less in the year preceding the year of assessment by 
  9.10  January 15 of the assessment year.  Those cabins or units and a 
  9.11  proportionate share of the land on which they are located will 
  9.12  be designated class 1, provided that the area of the property 
  9.13  receiving class 1 treatment must not exceed 100 feet of 
  9.14  lakeshore footage for each cabin or campsite located on the 
  9.15  property up to a total of 800 feet and 500 feet in depth, 
  9.16  measured away from the lakeshore.  The remainder of the cabins 
  9.17  or units and a proportionate share of the land on which they are 
  9.18  located in excess of the 800 feet by 500 feet area limitation is 
  9.19  designated as class 2.  If so requested, the owner of property 
  9.20  desiring designation as class 1 property must provide to the 
  9.21  assessor guest registers or other records demonstrating that the 
  9.22  units for which class 1 designation is sought were not occupied 
  9.23  for more than 250 days in the second year preceding the 
  9.24  assessment and are located within the allowable 500 feet by 800 
  9.25  feet area limitation.  The portion of a property operated as a 
  9.26  restaurant, bar, gift shop, and other nonresidential facility 
  9.27  operated on a commercial basis not directly related to temporary 
  9.28  and seasonal residential occupancy for recreation purposes is 
  9.29  class 3 property. 
  9.30     Subd. 10.  [NONPROFIT COMMUNITY SERVICE ORIENTED 
  9.31  ORGANIZATION.] "Nonprofit community service oriented 
  9.32  organization" means real property up to a maximum of one acre of 
  9.33  land owned by a nonprofit community service oriented 
  9.34  organization.  The property must not be used for a 
  9.35  revenue-producing activity for more than six days in the 
  9.36  calendar year preceding the year of assessment, and the property 
 10.1   must not be used for residential purposes on either a temporary 
 10.2   or permanent basis.  For purposes of this subdivision, a 
 10.3   nonprofit community service oriented organization means any 
 10.4   corporation, society, association, foundation, or institution 
 10.5   organized and operated exclusively for charitable, religious, 
 10.6   fraternal, civic, or educational purposes, and which is exempt 
 10.7   from federal income taxation pursuant to section 501(c)(3), 
 10.8   (10), or (19) of the Internal Revenue Code of 1986, as amended 
 10.9   through December 31, 1990.  For purposes of this subdivision, 
 10.10  "revenue-producing activities" includes but is not limited to 
 10.11  property, or that part of the property, that is used as an 
 10.12  on-sale intoxicating liquor or nonintoxicating malt liquor 
 10.13  establishment licensed under chapter 340A, a restaurant open to 
 10.14  the public, bowling alley, a retail store, gambling conducted by 
 10.15  organizations licensed under chapter 349, an insurance business, 
 10.16  or office or other space leased or rented to a lessee who 
 10.17  conducts a for-profit enterprise on the premises.  The use of 
 10.18  the property for social events open exclusively to members and 
 10.19  their guests for periods of less than 24 hours, when an 
 10.20  admission is not charged nor any revenues are received by the 
 10.21  organization, is not considered a revenue-producing activity. 
 10.22     Subd. 11.  [POST-SECONDARY STUDENT 
 10.23  HOUSING.] "Post-secondary student housing" means post-secondary 
 10.24  student housing of not more than one acre of land that is owned 
 10.25  by a nonprofit corporation organized under chapter 317A and is 
 10.26  used exclusively by a student cooperative, sorority, or 
 10.27  fraternity for on-campus housing or housing located within two 
 10.28  miles of the border of a college campus. 
 10.29     Subd. 12.  [MANUFACTURED HOME PARK.] "Manufactured home 
 10.30  park" means any site, lot, field, or tract of land upon which 
 10.31  two or more occupied manufactured homes are located, either free 
 10.32  of charge or for compensation, and includes any building, 
 10.33  structure, tent, vehicle, or enclosure used or intended for use 
 10.34  as part of the equipment of the manufactured home park. 
 10.35     Sec. 2.  [273.127] [VALUATION AND CLASSIFICATION OF 
 10.36  PROPERTY.] 
 11.1      Subdivision 1.  [MANNER OF VALUATION AND 
 11.2   CLASSIFICATION.] All real and personal property subject to a 
 11.3   general property tax and not subject to a gross earnings or 
 11.4   other fee in lieu of tax, is classified as provided in this 
 11.5   section.  
 11.6      Subd. 2.  [CLASS 1.] Class 1 property must be valued at 100 
 11.7   percent of market value, and has a class rate of one percent, 
 11.8   except that for assessment year 1996 through assessment year 
 11.9   1999, the class rate used for class 1 property shall be adjusted 
 11.10  by the county assessor as provided in section 6. 
 11.11     Class 1 property includes: 
 11.12     (1) agricultural land and improvements; 
 11.13     (2) timberland property; and 
 11.14     (3) that portion of seasonal residential recreational 
 11.15  property classified under section 273.126, subdivision 9, clause 
 11.16  (2), within the 800 feet by 500 feet area limitation. 
 11.17     The combined market value of each house, garage, and the 
 11.18  immediately surrounding one acre of land located on the 
 11.19  agricultural property which is occupied by the owner as a 
 11.20  homestead or is the residential unit occupied by the manager or 
 11.21  caretaker of the seasonal residential recreational property 
 11.22  under section 273.126, subdivision 9, clause (2), are class 2 
 11.23  property. 
 11.24     Subd. 3.  [CLASS 2.] Class 2 property must be valued at 100 
 11.25  percent of market value, and has a class rate of two percent, 
 11.26  except that for assessment year 1996 through assessment year 
 11.27  1999, the class rate used for class 2 property shall be adjusted 
 11.28  by the county assessor as provided in section 6.  
 11.29     Class 2 property includes: 
 11.30     (1) residential property containing one, two, or three 
 11.31  dwelling units; 
 11.32     (2) subsidized housing; 
 11.33     (3) that portion of the market value of commercial, 
 11.34  industrial, and utility property that does not exceed $100,000 
 11.35  market value.  In the case of state-assessed commercial, 
 11.36  industrial, and utility property owned by one person or entity, 
 12.1   only one parcel is eligible for the two percent class rate on 
 12.2   the first $100,000 of market value.  In the case of other 
 12.3   commercial, industrial, and utility property owned by one person 
 12.4   or entity, only one parcel in each county is eligible for the 
 12.5   two percent class rate on the first $100,000 of market value; 
 12.6   except that: 
 12.7      (i) if the market value of the parcel is less than 
 12.8   $100,000, and additional parcels are owned by the same person or 
 12.9   entity in the same city or town within that county, the reduced 
 12.10  class rate shall be applied up to a combined total market value 
 12.11  of $100,000 for all parcels owned by the same person or entity 
 12.12  in the same city or town within the county; 
 12.13     (ii) in the case of grain, fertilizer, and feed elevator 
 12.14  facilities, as defined in section 18C.305, subdivision 1, or 
 12.15  232.21, subdivision 8, the limitation to one parcel per owner 
 12.16  per county for the reduced class rate shall not apply, but there 
 12.17  shall be a limit of $100,000 of preferential value per site of 
 12.18  contiguous parcels owned by the same person or entity.  Only the 
 12.19  value of the elevator portion of each parcel shall qualify for 
 12.20  treatment under this clause.  For purposes of this subdivision, 
 12.21  contiguous parcels include parcels separated only by a railroad 
 12.22  or public road right-of-way; and 
 12.23     (iii) in the case of property owned by a nonprofit 
 12.24  charitable organization that qualifies for tax exemption under 
 12.25  section 501(c)(3) of the Internal Revenue Code of 1986, as 
 12.26  amended through December 31, 1993, if the property is used as a 
 12.27  business incubator, the limitation to one parcel per owner per 
 12.28  county for the reduced class rate shall not apply, provided that 
 12.29  the reduced rate applies only to the first $100,000 of value per 
 12.30  parcel owned by the organization.  As used in this clause, a 
 12.31  "business incubator" is a facility used for the development of 
 12.32  nonretail businesses, offering access to equipment, space, 
 12.33  services, and advice to the tenant businesses, for the purpose 
 12.34  of encouraging economic development, diversification, and job 
 12.35  creation in the area served by the organization. 
 12.36     To receive the reduced class rate on additional parcels 
 13.1   under items (i), (ii), or (iii), the taxpayer must notify the 
 13.2   county assessor that the taxpayer owns more than one parcel that 
 13.3   qualifies under items (i), (ii), or (iii); 
 13.4      (4) employment property defined in section 469.166, during 
 13.5   the period provided in section 469.170; 
 13.6      (5) that portion of the market value of employment property 
 13.7   located in a border city enterprise zone designated under 
 13.8   section 469.168, subdivision 4, paragraph (c) that does not 
 13.9   exceed $100,000 market value; 
 13.10     (6) manufactured home parks of four or more units; 
 13.11     (7) that portion of the market value of commercial 
 13.12  residential recreational property used for less than 250 days in 
 13.13  the previous year's assessment as defined under section 273.126, 
 13.14  subdivision 9, clause (2), which is in excess of the 800 feet by 
 13.15  500 feet area limitation; 
 13.16     (8) that portion of the market value of commercial 
 13.17  residential recreational property under section 273.126, 
 13.18  subdivision 9, clause (2), which is occupied by the owner as a 
 13.19  homestead or is the residential unit occupied by the manager or 
 13.20  caretaker; 
 13.21     (9) real property up to a maximum of one acre of land owned 
 13.22  by a nonprofit community service oriented organization; and 
 13.23     (10) post-secondary student housing. 
 13.24     For purposes of determining the market value for all rental 
 13.25  housing, the assessor shall determine the market value by using 
 13.26  the normal approach to value and using normal unrestricted rents.
 13.27     Subd. 4.  [CLASS 3.] Class 3 property must be valued at 100 
 13.28  percent of market value, and has a class rate of three percent, 
 13.29  except that for assessment year 1996 through assessment year 
 13.30  1999, the class rate used for class 3 property shall be adjusted 
 13.31  by the county assessor as provided in section 6. 
 13.32     Class 3 property is nonsubsidized residential real estate 
 13.33  with four or more units and used or held for use by the owner, 
 13.34  or by the tenants or lessees of the owner, as a residence for 
 13.35  rental periods of 30 days or more. 
 13.36     The tax savings from reducing the class rate provided in 
 14.1   this act beginning with the 1996 assessment must be used for 
 14.2   reduced rents, improved maintenance, and capital improvements to 
 14.3   the property.  Upon request, the manager of the property must 
 14.4   demonstrate that the estimated property tax savings have inured 
 14.5   to the tenants. 
 14.6      Subd. 5.  [CLASS 4.] Class 4 property must be valued at 100 
 14.7   percent of market value and has a class rate of 4.5 percent, 
 14.8   except that for assessment year 1996 through assessment year 
 14.9   1999, the class rate used for class 4 property shall be adjusted 
 14.10  by the county assessor as provided in section 6. 
 14.11     Class 4 property includes:  
 14.12     (1) that portion of the market value of commercial, 
 14.13  industrial, and utility property in excess of the first $100,000 
 14.14  market value provided under subdivision 3, clause (3); 
 14.15     (2) that portion of employment property defined in section 
 14.16  469.166 in excess of the first $100,000 market value provided in 
 14.17  subdivision 3, clause (4); 
 14.18     (3) tools, implements, and machinery of an electric 
 14.19  generating system transporting or distributing water, gas, crude 
 14.20  oil, or petroleum products or mains and pipes used in the 
 14.21  distribution of steam or hot or chilled water for heating or 
 14.22  cooling buildings, which are fixtures; 
 14.23     (4) unmined iron ore and low-grade iron-bearing formations 
 14.24  as defined in section 273.14; and 
 14.25     (5) all other property not otherwise classified. 
 14.26     Subd. 6.  [CLASSIFICATION OF UNIMPROVED PROPERTY.] (a) 
 14.27  Except as provided in paragraph (b), real property that is not 
 14.28  improved with a structure must be classified according to its 
 14.29  highest and best use permitted under the local zoning 
 14.30  ordinance.  If the ordinance permits more than one use, the land 
 14.31  must be classified according to the highest and best use 
 14.32  permitted under the ordinance.  If no such ordinance exists, the 
 14.33  assessor shall consider the most likely potential use of the 
 14.34  unimproved land based upon the use made of surrounding land or 
 14.35  land in proximity to the unimproved land. 
 14.36     (b) Real property that is not improved with a structure and 
 15.1   is in commercial, industrial, or agricultural use under this 
 15.2   section must be classified according to its actual use. 
 15.3      Subd. 7.  [MULTIUSE PROPERTY.] In the case of multiuse 
 15.4   property, the assessor shall apportion the valuation and 
 15.5   classification according to the uses of the property. 
 15.6      Sec. 3.  Minnesota Statutes 1994, section 273.1316, 
 15.7   subdivision 1, is amended to read: 
 15.8      Subdivision 1.  [DENIAL OF RENTAL CLASSIFICATION.] A 
 15.9   building that is classified as residential rental property under 
 15.10  section 273.13 273.127, subdivision 25 4, and that is determined 
 15.11  to be substandard under this section is assessed as provided in 
 15.12  at the class rate applicable to it under Minnesota Statutes 
 15.13  1988, section 273.13, subdivision 25, paragraph (e). 
 15.14     Sec. 4.  Minnesota Statutes 1994, section 273.1316, 
 15.15  subdivision 6, is amended to read: 
 15.16     Subd. 6.  [TIMING OF PROCESS.] If a notice of noncompliance 
 15.17  is mailed before July 1 of any year, and the property owner has 
 15.18  neither (1) successfully appealed the determination, nor (2) 
 15.19  brought the property into compliance by October 15 of that year, 
 15.20  the property will be assessed at the class rate applicable to it 
 15.21  under Minnesota Statutes 1988, section 273.13, subdivision 25, 
 15.22  paragraph (e), for taxes levied in that year and all subsequent 
 15.23  years until the agency determines that the property is no longer 
 15.24  a substandard building, or the property owner prevails on an 
 15.25  appeal of the matter.  If a notice of noncompliance is mailed 
 15.26  after June 30 of any year, the disqualification would initially 
 15.27  be effective for taxes levied in the following year. 
 15.28     Sec. 5.  Minnesota Statutes 1994, section 273.1316, 
 15.29  subdivision 7, is amended to read: 
 15.30     Subd. 7.  [REFUND UPON APPEAL.] If the property owner 
 15.31  prevails on an appeal at any time after taxes have been paid 
 15.32  based on assessment of the property as provided in section 
 15.33  273.13, subdivision 25 1, paragraph (e), the agency shall notify 
 15.34  the property owner concerning the procedures for the filing for 
 15.35  a refund.  The notice shall be in the form and include the 
 15.36  information prescribed by the local tax assessor.  The taxpayer 
 16.1   may then file for a refund of the difference between the amount 
 16.2   of the tax paid and the tax that would have been payable if the 
 16.3   property had not been incorrectly assessed under this section, 
 16.4   and each governmental subdivision that levied the tax on the 
 16.5   property shall refund to the property owner its proportionate 
 16.6   share of the refund.  
 16.7      Sec. 6.  [CLASS RATE ADJUSTMENTS FOR ASSESSMENT YEARS 1996 
 16.8   THROUGH 1999.] 
 16.9      The class rates in Minnesota Statutes, section 273.127, 
 16.10  subdivisions 2, 3, 4, and 5 shall be adjusted by the county 
 16.11  assessor as provided in this section.  The commissioner of 
 16.12  revenue shall prepare a schedule of the appropriate class rates 
 16.13  for each type of property for assessment years 1996, 1997, 1998, 
 16.14  and 1999.  The commissioner shall certify the rates for the 
 16.15  appropriate assessment year to each county assessor on or before 
 16.16  June 1, 1996, and on or before June 1 of the next three 
 16.17  subsequent assessment years for use in determining taxes payable 
 16.18  in the following year.  The class rates contained in Minnesota 
 16.19  Statutes 1994, section 273.13, shall be used for the 1995 
 16.20  assessment year, for taxes payable in 1996.  In assessment years 
 16.21  1996, 1997, 1998, and 1999, the commissioner of revenue shall 
 16.22  determine the appropriate class rate for each of the types of 
 16.23  property using the following schedule: 
 16.24   For taxes     Proportion of Payable   Proportion of Payable
 16.25   Payable Year  1996 Class Rate         2001 Class Rate
 16.26      1997              80%                     20%  
 16.27      1998              60%                     40% 
 16.28      1999              40%                     60%
 16.29      2000              20%                     80%
 16.30      2001               0%                    100%
 16.31     Sec. 7.  [PROPOSED LEGISLATION.] 
 16.32     The commissioner of revenue shall prepare legislation for 
 16.33  introduction in the 1996 legislative session to change 
 16.34  references to Minnesota Statutes, section 273.13, to the 
 16.35  appropriate section and subdivision.  The revisor of statutes 
 16.36  shall assist in the preparation of the legislation. 
 17.1      Sec. 8.  [REPEALER.] 
 17.2      Minnesota Statutes 1994, sections 273.124; and 273.13, are 
 17.3   repealed. 
 17.4      Sec. 9.  [EFFECTIVE DATE.] 
 17.5      Sections 1 to 6 are effective for the 1996 assessment and 
 17.6   thereafter, for taxes payable in 1997 and thereafter, provided 
 17.7   that the class rates in section 2, subdivisions 2, 3, 4, and 5, 
 17.8   shall be adjusted as provided in section 2, subdivision 6, for 
 17.9   assessment years 1996, 1997, 1998, and 1999.  Section 8 is 
 17.10  effective for assessment year 2000 and thereafter. 
 17.11                             ARTICLE 2
 17.12              HOMEOWNER AND RENTER PROPERTY TAX REFUND
 17.13     Section 1.  Minnesota Statutes 1994, section 289A.18, 
 17.14  subdivision 5, is amended to read: 
 17.15     Subd. 5.  [PROPERTY TAX REFUND CLAIMS.] A claim for a 
 17.16  refund based on property taxes payable must be filed with the 
 17.17  commissioner on or before August 15 May 15 of the year in which 
 17.18  the property taxes are due and payable.  Any claim for refund 
 17.19  based on rent paid must be filed on or before August 15 May 15 
 17.20  of the year following the year in which the rent was paid.  
 17.21     Sec. 2.  Minnesota Statutes 1994, section 289A.56, 
 17.22  subdivision 6, is amended to read: 
 17.23     Subd. 6.  [PROPERTY TAX REFUNDS UNDER CHAPTER 290A.] (a) 
 17.24  When a renter is owed a property tax refund, an unpaid refund 
 17.25  bears interest after August 14, or 60 days after the refund 
 17.26  claim was made, whichever is later, until the date the refund is 
 17.27  paid. 
 17.28     (b) When any other claimant is owed a property tax refund, 
 17.29  the unpaid refund bears interest after September 29 June 30, or 
 17.30  60 days after the refund claim was made, whichever is later, 
 17.31  until the date the refund is paid. 
 17.32     Sec. 3.  Minnesota Statutes 1994, section 290A.01, is 
 17.33  amended to read: 
 17.34     290A.01 [CITATION.] 
 17.35     This chapter may be cited as the "state of Minnesota 
 17.36  homeowner and renter property tax refund act." 
 18.1      Sec. 4.  Minnesota Statutes 1994, section 290A.03, 
 18.2   subdivision 6, is amended to read: 
 18.3      Subd. 6.  [HOMESTEAD.] "Homestead" means the dwelling 
 18.4   occupied as the claimant's principal residence and so much of 
 18.5   the land surrounding it, not exceeding ten acres, as is 
 18.6   reasonably necessary for use of the dwelling as a home and any 
 18.7   other property used for purposes of a homestead as defined in 
 18.8   section 273.13, subdivision 22, except for agricultural land 
 18.9   assessed as part of a homestead pursuant to section 273.13, 
 18.10  subdivision 23, "homestead" is limited to 320 acres or, where 
 18.11  the farm homestead is rented, one acre.  The homestead dwelling 
 18.12  may be owned or, rented and may be a, or used by someone who is 
 18.13  not the owner, provided that if it is part of a multidwelling or 
 18.14  multipurpose building, only that portion of the property and the 
 18.15  land on which it is built located and is reasonably necessary 
 18.16  for the use of the dwelling as a home shall be considered the 
 18.17  homestead for purposes of this chapter.  A manufactured home, as 
 18.18  defined in section 273.125, subdivision 8, assessed as personal 
 18.19  property may be a dwelling for purposes of this subdivision. 
 18.20     Sec. 5.  Minnesota Statutes 1994, section 290A.03, 
 18.21  subdivision 13, is amended to read: 
 18.22     Subd. 13.  [PROPERTY TAXES PAYABLE.] "Property taxes 
 18.23  payable" means the property tax exclusive of special 
 18.24  assessments, penalties, and interest payable on a claimant's 
 18.25  homestead before reductions made under section 273.13 but after 
 18.26  deductions made under sections 273.135, 273.1391, 273.42, 
 18.27  subdivision 2, and any other state paid property tax credits in 
 18.28  any calendar year.  If the homestead is part of a multidwelling 
 18.29  or multipurpose building, only the amount of the total property 
 18.30  taxes on the property relative to the homestead as defined in 
 18.31  subdivision 6 shall be considered "property taxes payable" for 
 18.32  purposes of computing the refund under this chapter.  In the 
 18.33  case of a claimant who makes ground lease payments, "property 
 18.34  taxes payable" includes the amount of the payments directly 
 18.35  attributable to the property taxes assessed against the parcel 
 18.36  on which the house is located.  No apportionment or reduction of 
 19.1   the "property taxes payable" shall be required for the use of a 
 19.2   portion of the claimant's homestead for a business purpose if 
 19.3   the claimant does not deduct any business depreciation expenses 
 19.4   for the use of a portion of the homestead in the determination 
 19.5   of federal adjusted gross income.  For homesteads which are 
 19.6   manufactured homes as defined in section 274.19, subdivision 8, 
 19.7   "property taxes payable" shall also include the amount of the 
 19.8   gross rent paid in the preceding year for the site on which the 
 19.9   homestead is located, which is attributable to the net tax paid 
 19.10  on the site.  The amount attributable to property taxes shall be 
 19.11  determined by multiplying the net tax on the parcel by a 
 19.12  fraction, the numerator of which is the gross rent paid for the 
 19.13  calendar year for the site and the denominator of which is the 
 19.14  gross rent paid for the calendar year for the parcel.  When a 
 19.15  homestead is owned by two or more persons as joint tenants or 
 19.16  tenants in common, such tenants shall determine between them 
 19.17  which tenant may claim the property taxes payable on the 
 19.18  homestead.  If they are unable to agree, the matter shall be 
 19.19  referred to the commissioner of revenue whose decision shall be 
 19.20  final.  Property taxes are considered payable in the year 
 19.21  prescribed by law for payment of the taxes. 
 19.22     In the case of a claim relating to "property taxes 
 19.23  payable," the claimant must have owned and occupied the 
 19.24  homestead on January 2 of the year in which the tax is payable 
 19.25  and (i) the property must have been classified as homestead 
 19.26  property pursuant to section 273.13, subdivision 22 or 23, on or 
 19.27  before December 15 of the assessment year to which the "property 
 19.28  taxes payable" relate; or (ii) the claimant must provide 
 19.29  documentation from the local assessor that application for 
 19.30  homestead classification has been made on or before December 15 
 19.31  of the year in which the "property taxes payable" were payable 
 19.32  and that the assessor has approved the application. 
 19.33     Sec. 6.  Minnesota Statutes 1994, section 290A.04, 
 19.34  subdivision 2, is amended to read: 
 19.35     Subd. 2.  [HOMEOWNERS AND RENTERS.] In 1997 and subsequent 
 19.36  years a claimant whose property taxes payable are in excess of 
 20.1   the percentage of the household income stated below shall pay an 
 20.2   amount equal to the percent of income shown for the appropriate 
 20.3   household income level along with the percent to be paid by the 
 20.4   claimant of the remaining amount of property taxes payable.  The 
 20.5   state refund equals the amount of property taxes payable that 
 20.6   remain, up to the state refund amount shown below.  
 20.7                         Percent           Percent    Maximum
 20.8   Household Income     of Income          Paid by     State
 20.9                                           Claimant    Refund
 20.10      $0 to 1,029     1.2 percent        18 percent   $440
 20.11   1,030 to 2,059     1.3 percent        18 percent   $440
 20.12   2,060 to 3,099     1.4 percent        20 percent   $440
 20.13   3,100 to 4,129     1.6 percent        20 percent   $440
 20.14   4,130 to 5,159     1.7 percent        20 percent   $440
 20.15   5,160 to 7,229     1.9 percent        25 percent   $440
 20.16   7,230 to 8,259     2.1 percent        25 percent   $440
 20.17   8,260 to 9,289     2.2 percent        25 percent   $440
 20.18   9,290 to 10,319    2.3 percent        30 percent   $440
 20.19  10,320 to 11,349    2.4 percent        30 percent   $440
 20.20  11,350 to 12,389    2.5 percent        30 percent   $440
 20.21  12,390 to 14,449    2.6 percent        30 percent   $440
 20.22  14,450 to 15,479    2.8 percent        35 percent   $440
 20.23  15,480 to 16,509    3.0 percent        35 percent   $440
 20.24  16,510 to 17,549    3.2 percent        40 percent   $440
 20.25  17,550 to 21,669    3.3 percent        40 percent   $440
 20.26  21,670 to 24,769    3.4 percent        45 percent   $440
 20.27  24,770 to 30,959    3.5 percent        45 percent   $440
 20.28  30,960 to 36,119    3.5 percent        45 percent   $440
 20.29  36,120 to 41,279    3.7 percent        50 percent   $440
 20.30  41,280 to 58,829    4.0 percent        50 percent   $440
 20.31  58,830 to 59,859    4.0 percent        50 percent   $310
 20.32  59,860 to 60,889    4.0 percent        50 percent   $210
 20.33  60,890 to 61,929    4.0 percent        50 percent   $100 
 20.34       $0 to 9,999    1.0 percent        20 percent  $2,500
 20.35  10,000 to 12,499    1.3 percent        25 percent  $2,000
 20.36  12,500 to 14,999    1.5 percent        27 percent  $1,800
 21.1   15,000 to 17,499    1.7 percent        28 percent  $1,600
 21.2   17,500 to 19,999    1.9 percent        29 percent  $1,500
 21.3   20,000 to 22,499    2.2 percent        35 percent  $1,500
 21.4   22,500 to 24,999    2.4 percent        37 percent  $1,500
 21.5   25,000 to 27,499    2.5 percent        39 percent  $1,500
 21.6   27,500 to 29,999    2.5 percent        39 percent  $1,500
 21.7   30,000 to 34,999    2.6 percent        40 percent  $1,500
 21.8   35,000 to 39,999    2.8 percent        43 percent  $1,500
 21.9   40,000 to 44,999    3.0 percent        45 percent  $1,250
 21.10  45,000 to 49,999    3.2 percent        50 percent  $1,250
 21.11  50,000 to 54,999    3.5 percent        55 percent  $1,000
 21.12  55,000 to 59,999    3.8 percent        60 percent    $750
 21.13  60,000 to 64,999    4.0 percent        65 percent    $450
 21.14  65,000 to 69,999    4.0 percent        65 percent    $250
 21.15  70,000 and up                   No refund
 21.16     The payment made to a claimant shall be the amount of the 
 21.17  state refund calculated under this subdivision.  No payment is 
 21.18  allowed if the claimant's household income is $61,930 $70,000 or 
 21.19  more. 
 21.20     Sec. 7.  Minnesota Statutes 1994, section 290A.04, is 
 21.21  amended by adding a subdivision to read: 
 21.22     Subd. 2j.  [HOMEOWNERS AND RENTERS; FOR 1996 ONLY.] In 
 21.23  1996, a claimant whose property taxes payable are in excess of 
 21.24  the percentage of the household income stated below shall pay an 
 21.25  amount equal to the percent of income shown for the appropriate 
 21.26  household income level along with the percent to be paid by the 
 21.27  claimant of the remaining amount of property taxes payable.  The 
 21.28  state refund equals the amount of property taxes payable that 
 21.29  remain, up to the state refund amount shown below. 
 21.30                       Percent          Percent    Maximum
 21.31  Household Income    of Income         Paid by     State
 21.32                                        Claimant    Refund
 21.33       $0 to 9,999    1.0 percent       20 percent  $1,500
 21.34  10,000 to 12,499    1.3 percent       25 percent  $1,400
 21.35  12,500 to 14,999    1.5 percent       27 percent  $1,400
 21.36  15,000 to 17,499    1.7 percent       28 percent  $1,300
 22.1   17,500 to 19,999    1.9 percent       29 percent  $1,300
 22.2   20,000 to 22,499    2.2 percent       35 percent  $1,200
 22.3   22,500 to 24,999    2.4 percent       37 percent  $1,200
 22.4   25,000 to 27,499    2.5 percent       39 percent  $1,100
 22.5   27,500 to 29,999    2.5 percent       39 percent  $1,100
 22.6   30,000 to 34,999    2.6 percent       40 percent  $1,000
 22.7   35,000 to 39,999    2.8 percent       43 percent    $900
 22.8   40,000 to 44,999    3.0 percent       45 percent    $800
 22.9   45,000 to 49,999    3.2 percent       50 percent    $700
 22.10  50,000 to 54,999    3.5 percent       55 percent    $500
 22.11  55,000 to 59,999    3.8 percent       60 percent    $400
 22.12  60,000 to 64,999    4.0 percent       65 percent    $300
 22.13  65,000 to 69,999    4.0 percent       65 percent    $200
 22.14  70,000 and up                   No refund
 22.15     The payment made to a claimant shall be the amount of the 
 22.16  state refund calculated under this subdivision.  No payment is 
 22.17  allowed if the claimant's household income is $70,000 or more. 
 22.18     Sec. 8.  Minnesota Statutes 1994, section 290A.07, is 
 22.19  amended to read: 
 22.20     290A.07 [TIME FOR PAYMENT.] 
 22.21     Subdivision 1.  Allowable claims filed pursuant to by 
 22.22  renters under the provisions of this chapter shall be paid by 
 22.23  the commissioner from the general fund.  Allowable claims filed 
 22.24  by homeowners under the provisions of this chapter shall be paid 
 22.25  from the general fund to the homeowner by the commissioner in 
 22.26  the form of a legally negotiated voucher.  
 22.27     Subd. 2a.  A claimant who is a renter or a homeowner who 
 22.28  occupies a manufactured home, as defined in section 273.125, 
 22.29  subdivision 8, paragraph (c), shall receive full payment after 
 22.30  August 1 and before August 15 or 60 days after receipt of the 
 22.31  application, whichever is later.  
 22.32     Subd. 3.  A claimant not included in subdivision 2a shall 
 22.33  receive a voucher for the full payment after September 15 July 1 
 22.34  and before September 30 July 8.  The voucher shall be made 
 22.35  payable to the claimant with a space provided for the claimant's 
 22.36  signature.  A second signature shall also be required on the 
 23.1   voucher with space provided for the second signature.  To redeem 
 23.2   the voucher for payment, the claimant shall endorse the voucher 
 23.3   and present or mail it either to:  (1) the appropriate financial 
 23.4   institution if the current property taxes on the claimant's 
 23.5   homestead are escrowed by an escrow agent; or (2) the county 
 23.6   treasurer of the county where the property is located if the 
 23.7   property taxes on the claimant's homestead are paid directly by 
 23.8   the claimant.  If the property taxes on the claimant's homestead 
 23.9   are paid directly by the claimant and if the amount of the 
 23.10  voucher is more than the amount of the July 15 payment 
 23.11  installment, the county treasurer shall retain the full amount 
 23.12  of the voucher and shall credit the amount of excess to the 
 23.13  October 15 payment installment on the taxpayer's property. 
 23.14     Sec. 9.  Minnesota Statutes 1994, section 290A.23, 
 23.15  subdivision 3, is amended to read: 
 23.16     Subd. 3.  [ANNUAL APPROPRIATION.] For payments made after 
 23.17  July 1, 1996, there is annually appropriated from the general 
 23.18  fund to the commissioner of revenue the amount necessary to make 
 23.19  the payments required under section 290A.04, 
 23.20  subdivisions subdivision 2 and 2h. 
 23.21     Sec. 10.  [290A.26] [PROPERTY TAX REFUND FORMS AND 
 23.22  INSTRUCTIONS.] 
 23.23     Anually for returns filed in 1996 through 2001, and then at 
 23.24  least every third year thereafter, or more frequently based on 
 23.25  the commissioner of revenue's discretion, the commissioner shall 
 23.26  mail a copy of the Minnesota Property Tax Refund form and 
 23.27  instructions to all Minnesota taxpayers who filed an individual 
 23.28  income tax return in the previous year.  The commissioner of 
 23.29  revenue may include the Minnesota property tax form and 
 23.30  instructions as an insert to the individual income tax form, 
 23.31  provided that the property tax refund form and instructions are 
 23.32  printed on a different color paper than the income tax form and 
 23.33  instructions so they can easily be identified as a separate 
 23.34  document.  The commissioner of revenue may also notify taxpayers 
 23.35  through press releases distributed statewide or any other 
 23.36  appropriate method of notification to alert taxpayers of the 
 24.1   changes made by this article. 
 24.2      Sec. 11.  [REPEALER.] 
 24.3      Minnesota Statutes 1994, sections 290A.04, subdivisions 2a, 
 24.4   2b, 2h, and 2i, and 290A.23, subdivisions 1 and 2, are repealed. 
 24.5      Sec. 12.  [EFFECTIVE DATE.] 
 24.6      Sections 1, 2, 6, and 8 are effective for homeowners for 
 24.7   claims based on property taxes payable in 1997 and thereafter 
 24.8   and for renters for claims based on rent paid in 1996 and 
 24.9   thereafter. 
 24.10     Sections 3 to 5, 9, and 11 are effective for homeowners for 
 24.11  claims based on property taxes payable in 1996 and thereafter, 
 24.12  and for renters for claims based on rent paid in 1995 and 
 24.13  thereafter. 
 24.14     Section 7 is effective for homeowners for claims based on 
 24.15  property taxes payable in 1996, and for renters for claims based 
 24.16  on rent paid in 1995. 
 24.17                             ARTICLE 3
 24.18                     PROPERTY TAX PAYMENT DATES
 24.19     Section 1.  Minnesota Statutes 1994, section 275.065, 
 24.20  subdivision 3, is amended to read: 
 24.21     Subd. 3.  [NOTICE OF PROPOSED PROPERTY TAXES.] (a) The 
 24.22  county auditor shall prepare and the county treasurer shall 
 24.23  deliver after November 10 and on or before November 24 each 
 24.24  year, by first class mail to each taxpayer at the address listed 
 24.25  on the county's current year's assessment roll, a notice of 
 24.26  proposed property taxes and, in the case of a town, final 
 24.27  property taxes.  
 24.28     (b) The commissioner of revenue shall prescribe the form of 
 24.29  the notice. 
 24.30     (c) The notice must inform taxpayers that it contains the 
 24.31  amount of property taxes each taxing authority other than a town 
 24.32  proposes to collect for taxes payable the following year and, 
 24.33  for a town, the amount of its final levy.  It must clearly state 
 24.34  that each taxing authority, including regional library districts 
 24.35  established under section 134.201, and including the 
 24.36  metropolitan taxing districts as defined in paragraph (i), but 
 25.1   excluding all other special taxing districts and towns, will 
 25.2   hold a public meeting to receive public testimony on the 
 25.3   proposed budget and proposed or final property tax levy, or, in 
 25.4   case of a school district, on the current budget and proposed 
 25.5   property tax levy.  It must clearly state the time and place of 
 25.6   each taxing authority's meeting and an address where comments 
 25.7   will be received by mail.  The notice must include the estimated 
 25.8   percentage increase in Minnesota personal income, provided by 
 25.9   the commissioner of revenue under section 275.064, in a way to 
 25.10  facilitate comparison of the proposed budget and levy increases 
 25.11  with the increase in personal income.  For 1993, the notice must 
 25.12  clearly state that each taxing authority holding a public 
 25.13  meeting will describe the increases or decreases of the total 
 25.14  budget, including employee and independent contractor 
 25.15  compensation in the prior year, current year, and the proposed 
 25.16  budget year.  
 25.17     (d) The notice must state for each parcel: 
 25.18     (1) the market value of the property as determined under 
 25.19  section 273.11, and used for computing property taxes payable in 
 25.20  the following year and for taxes payable in the current year; 
 25.21  and, in the case of residential property, whether the property 
 25.22  is classified as homestead or nonhomestead.  The notice must 
 25.23  clearly inform taxpayers of the years to which the market values 
 25.24  apply and that the values are final values; 
 25.25     (2) by county, city or town, school district excess 
 25.26  referenda levy, remaining school district levy, regional library 
 25.27  district, if in existence, the total of the metropolitan special 
 25.28  taxing districts as defined in paragraph (i) and the sum of the 
 25.29  remaining special taxing districts, and as a total of the taxing 
 25.30  authorities, including all special taxing districts, the 
 25.31  proposed or, for a town, final net tax on the property for taxes 
 25.32  payable the following year and the actual tax for taxes payable 
 25.33  the current year.  It shall separately show the amount of tax 
 25.34  attributable to excess levies, as defined under section 275.63 
 25.35  for each taxing authority.  For the purposes of this 
 25.36  subdivision, "school district excess referenda levy" means 
 26.1   school district taxes for operating purposes approved at 
 26.2   referendums, including those taxes based on net tax capacity as 
 26.3   well as those based on market value.  "School district excess 
 26.4   referenda levy" does not include school district taxes for 
 26.5   capital expenditures approved at referendums or school district 
 26.6   taxes to pay for the debt service on bonds approved at 
 26.7   referenda.  In the case of the city of Minneapolis, the levy for 
 26.8   the Minneapolis library board and the levy for Minneapolis park 
 26.9   and recreation shall be listed separately from the remaining 
 26.10  amount of the city's levy.  In the case of a parcel where tax 
 26.11  increment or the fiscal disparities areawide tax applies, the 
 26.12  proposed tax levy on the captured value or the proposed tax levy 
 26.13  on the tax capacity subject to the areawide tax must each be 
 26.14  stated separately and not included in the sum of the special 
 26.15  taxing districts; and 
 26.16     (3) the increase or decrease in the amounts in clause (2) 
 26.17  from taxes payable in the current year to proposed or, for a 
 26.18  town, final taxes payable the following year, expressed as a 
 26.19  dollar amount and as a percentage. 
 26.20     (e) The notice must clearly state that the proposed or 
 26.21  final taxes do not include the following: 
 26.22     (1) special assessments; 
 26.23     (2) levies approved by the voters after the date the 
 26.24  proposed taxes are certified, including bond referenda, and 
 26.25  school district levy referenda, and levy limit increase 
 26.26  referenda; 
 26.27     (3) amounts necessary to pay cleanup or other costs due to 
 26.28  a natural disaster occurring after the date the proposed taxes 
 26.29  are certified; 
 26.30     (4) amounts necessary to pay tort judgments against the 
 26.31  taxing authority that become final after the date the proposed 
 26.32  taxes are certified; and 
 26.33     (5) the contamination tax imposed on properties which 
 26.34  received market value reductions for contamination. 
 26.35     (f) The notice must also provide comparative statewide 
 26.36  average spending costs per household, and per pupil in the case 
 27.1   of school districts, for the most recent year available based 
 27.2   upon information reported to the state auditor.  The 
 27.3   commissioners of revenue and education will determine the 
 27.4   statewide average spending costs and certify them to the county 
 27.5   auditor annually by September 1.  The following comparative cost 
 27.6   categories will be listed on the notice.  The taxpayer's city or 
 27.7   town, county, and school district's average cost relating to the 
 27.8   taxing authority where the taxpayer's property is located will 
 27.9   be listed on the notice across from the appropriate category. 
 27.10                                                      Taxpayer's
 27.11                                       Average         City/Town
 27.12                                      Household           County
 27.13                                        Costs      School District
 27.14  Cities, population of
 27.15       2,500 - 9,999                  $.......         $.......
 27.16       10,000 - 24,999                $.......         $.......
 27.17       25,000 - 49,999                $.......         $.......
 27.18       50,000 and over                $.......         $.......
 27.19  Counties (administrative costs only
 27.20       seven metropolitan counties    $.......         $.......
 27.21       nonmetropolitan counties       $.......         $.......
 27.22  School districts (per pupil)
 27.23  School size
 27.24       0 - 599                        $.......         $.......
 27.25       600 - 1,139                    $.......         $.......
 27.26       1,140 - 3,999                  $.......         $.......
 27.27       4,000 and over                 $.......         $.......
 27.28     A caveat must be stated on the notice that costs in a 
 27.29  taxpayer's taxing authority which are higher than the statewide 
 27.30  average costs within that category could result from many 
 27.31  factors including low property wealth, local spending decisions, 
 27.32  circumstances unique to the taxpayer's taxing authority, and 
 27.33  that further information is available from the taxpayer's local 
 27.34  elected officials.  The commissioner of revenue shall prepare 
 27.35  the generic statement used on the notice. 
 27.36     (g) Except as provided in subdivision 7, failure of the 
 28.1   county auditor to prepare or the county treasurer to deliver the 
 28.2   notice as required in this section does not invalidate the 
 28.3   proposed or final tax levy or the taxes payable pursuant to the 
 28.4   tax levy. 
 28.5      (g) (h) If the notice the taxpayer receives under this 
 28.6   section lists the property as nonhomestead and the homeowner 
 28.7   provides satisfactory documentation to the county assessor that 
 28.8   the property is owned and has been used as the owner's homestead 
 28.9   prior to June 1 of that year, the assessor shall reclassify the 
 28.10  property to homestead for taxes payable in the following year. 
 28.11     (h) (i) In the case of class 4 residential property used as 
 28.12  a residence for lease or rental periods of 30 days or more, the 
 28.13  taxpayer must either: 
 28.14     (1) mail or deliver a copy of the notice of proposed 
 28.15  property taxes to each tenant, renter, or lessee; or 
 28.16     (2) and post a copy of the notice in a conspicuous place on 
 28.17  the premises of the property.  
 28.18     (i) (j) For purposes of this subdivision, subdivisions 5a 
 28.19  and 6, "metropolitan special taxing districts" means the 
 28.20  following taxing districts in the seven-county metropolitan area 
 28.21  that levy a property tax for any of the specified purposes 
 28.22  listed below: 
 28.23     (1) metropolitan council under section 473.132, 473.167, 
 28.24  473.249, 473.325, 473.446, 473.521, 473.547, or 473.834; 
 28.25     (2) metropolitan airports commission under section 473.667, 
 28.26  473.671, or 473.672; and 
 28.27     (3) metropolitan mosquito control commission under section 
 28.28  473.711. 
 28.29     For purposes of this section, any levies made by the 
 28.30  regional rail authorities in the county of Anoka, Carver, 
 28.31  Dakota, Hennepin, Ramsey, Scott, or Washington under chapter 
 28.32  398A shall be included with the appropriate county's levy and 
 28.33  shall be discussed at that county's public hearing. 
 28.34     The notice must be mailed or posted by the taxpayer by 
 28.35  November 27 or within three days of receipt of the notice, 
 28.36  whichever is later.  A taxpayer may notify the county treasurer 
 29.1   of the address of the taxpayer, agent, caretaker, or manager of 
 29.2   the premises to which the notice must be mailed in order to 
 29.3   fulfill the requirements of this paragraph. 
 29.4      Sec. 2.  Minnesota Statutes 1994, section 275.07, 
 29.5   subdivision 1, is amended to read: 
 29.6      Subdivision 1.  The taxes voted by cities, counties, school 
 29.7   districts, and special districts shall be certified by the 
 29.8   proper authorities to the county auditor on or before five 
 29.9   working days after December 20 in each year.  A town must 
 29.10  certify the levy adopted by the town board to the county auditor 
 29.11  by September 15 each year.  If the town board modifies the levy 
 29.12  at a special town meeting after September 15, the town board 
 29.13  must recertify its levy to the county auditor on or before five 
 29.14  working days after December 20.  The taxes certified shall not 
 29.15  be reduced by the aid received under sections 273.1398, 
 29.16  subdivisions 2 and 3, and 477A.013.  If a city, town, county, 
 29.17  school district, or special district fails to certify its levy 
 29.18  by that date, its levy shall be the amount levied by it for the 
 29.19  preceding year.  
 29.20     Sec. 3.  Minnesota Statutes 1994, section 275.08, 
 29.21  subdivision 1b, is amended to read: 
 29.22     Subd. 1b.  The amounts certified under section 275.07 after 
 29.23  adjustment under section 275.07, subdivision 3, by an individual 
 29.24  local government unit, except for any amounts certified under 
 29.25  sections 124A.03, subdivision 2a, and 275.61, shall be divided 
 29.26  by the total net tax capacity of all taxable properties within 
 29.27  the local government unit's taxing jurisdiction.  The resulting 
 29.28  ratio, the local government's local tax rate, multiplied by each 
 29.29  property's net tax capacity shall be each property's tax for 
 29.30  that local government unit before reduction by any credits.  
 29.31     Any amount certified to the county auditor under section 
 29.32  124A.03, subdivision 2a, or 275.61, after the dates given in 
 29.33  those sections, or 275.64 shall be divided by the total 
 29.34  estimated market value of all taxable properties within the 
 29.35  taxing district.  The resulting ratio, the taxing district's new 
 29.36  referendum tax rate, multiplied by each property's estimated 
 30.1   market value shall be each property's new referendum tax before 
 30.2   reduction by any credits. 
 30.3      Sec. 4.  [275.63] [EXCESS LEVIES; DEFINITIONS.] 
 30.4      Subdivision 1.  [APPLICABILITY.] For the purposes of this 
 30.5   section and section 275.64, the terms defined in this section 
 30.6   have the meanings given to them in this section. 
 30.7      Subd. 2.  [TAXING JURISDICTION.] "Taxing jurisdiction" 
 30.8   means a county, home rule charter or statutory city, town, or 
 30.9   special taxing district. 
 30.10     Subd. 3.  [INDEXED GROWTH ALLOWANCE.] For any levy year, 
 30.11  "indexed growth allowance" means the estimated percentage 
 30.12  increase in Minnesota personal income per household using the 
 30.13  same Minnesota personal income data as determined under section 
 30.14  275.064. 
 30.15     Subd. 4.  [BASE TAX CAPACITY LEVY PER HOUSEHOLD.] For any 
 30.16  levy year, a taxing jurisdiction's "base tax capacity levy per 
 30.17  household" means its base tax capacity levy per household for 
 30.18  the previous levy year, increased by a percentage equal to its 
 30.19  indexed growth allowance.  For taxes levied in 1996, payable in 
 30.20  1997, only, the "base tax capacity levy per household for the 
 30.21  previous levy year" means the sum of (i) the jurisdiction's 
 30.22  certified levy for taxes levied in 1995, payable in 1996, its 
 30.23  certified local government aid amount for calendar year 1996, 
 30.24  and its certified homestead and agricultural credit aid amount 
 30.25  for calendar year 1996, divided by (ii) the taxing 
 30.26  jurisdiction's estimated number of households in 1995. 
 30.27     Subd. 5.  [BASE TAX CAPACITY LEVY.] For any levy year, a 
 30.28  taxing jurisdiction's "base tax capacity levy" means its base 
 30.29  tax capacity levy per household, multiplied by its estimated 
 30.30  number of households as defined in section 275.62, subdivision 3.
 30.31     Subd. 6.  [EXCESS LEVY.] For any taxing jurisdiction in any 
 30.32  levy year, "excess levy" means the amount by which the sum of 
 30.33  the taxing jurisdiction's levy, certified local government aid 
 30.34  amount, and certified homestead and agricultural aid amount 
 30.35  exceeds its base tax capacity levy. 
 30.36     Sec. 5.  [275.64] [EXCESS LEVIES; HOW SPREAD.] 
 31.1      Excess levies shall be levied against the market value of 
 31.2   all taxable property within the taxing jurisdiction.  The amount 
 31.3   of a taxing jurisdiction's excess levy shall be certified 
 31.4   separately to the county auditor under section 275.07. 
 31.5      Sec. 6.  Minnesota Statutes 1994, section 276.04, 
 31.6   subdivision 3, is amended to read: 
 31.7      Subd. 3.  [MAILING OF TAX STATEMENTS.] The county treasurer 
 31.8   shall mail to taxpayers statements of their personal property 
 31.9   taxes due not later than April 15 for property taxes payable in 
 31.10  1990 and March 31 for taxes payable in 1997 and thereafter, 
 31.11  except in the case of manufactured homes and sectional 
 31.12  structures taxed as personal property.  Statements of the real 
 31.13  property taxes due shall be mailed not later than April 15 for 
 31.14  property taxes payable in 1990 and March 31 for taxes payable in 
 31.15  1997 and thereafter.  The validity of the tax shall not be 
 31.16  affected by failure of the treasurer to mail the statement.  The 
 31.17  taxpayer is defined as the owner who is responsible for the 
 31.18  payment of the tax.  
 31.19     Sec. 7.  Minnesota Statutes 1994, section 276.09, is 
 31.20  amended to read: 
 31.21     276.09 [SETTLEMENT BETWEEN AUDITOR AND TREASURER.] 
 31.22     On the later of May 20 of each year or 26 calendar days 
 31.23  after the postmark date on the envelopes containing real or 
 31.24  personal property tax statements, and on July 20 of each year, 
 31.25  the county treasurer shall make full settlement with the county 
 31.26  auditor of all receipts collected for all purposes, from the 
 31.27  date of the last settlement up to and including each day 
 31.28  mentioned.  The county auditor shall, within 30 days after the 
 31.29  settlement, send an abstract of it to the state auditor in the 
 31.30  form prescribed by the state auditor.  At the settlement the 
 31.31  treasurer shall make complete returns of the receipts on the 
 31.32  current tax list, showing the amount collected on account of the 
 31.33  several funds included in the list. 
 31.34     Settlement of receipts from the later of May 20, July 20, 
 31.35  or the actual settlement date to December 31 of each year must 
 31.36  be made as provided in section 276.111. 
 32.1      For purposes of this section, "receipts" includes all tax 
 32.2   payments received by the county treasurer on or before the 
 32.3   settlement date.  
 32.4      Sec. 8.  Minnesota Statutes 1994, section 276.10, is 
 32.5   amended to read: 
 32.6      276.10 [APPORTIONMENT AND DISTRIBUTION OF FUNDS.] 
 32.7      On the settlement day days determined in section 276.09 for 
 32.8   each year, the county auditor and county treasurer shall 
 32.9   distribute all undistributed funds in the treasury.  The funds 
 32.10  must be apportioned as provided by law, and credited to the 
 32.11  state, town, city, school district, special district and each 
 32.12  county fund.  Within 20 days after the distribution is 
 32.13  completed, the county auditor shall report to the state auditor 
 32.14  in the form prescribed by the state auditor.  The county auditor 
 32.15  shall issue a warrant for the payment of money in the county 
 32.16  treasury to the credit of the state, town, city, school 
 32.17  district, or special districts on application of the persons 
 32.18  entitled to receive the payment.  The county auditor may apply 
 32.19  the local tax rate from the year before the year of distribution 
 32.20  when apportioning and distributing delinquent tax proceeds, if 
 32.21  the composition of the previous year's local tax rate between 
 32.22  taxing districts is not significantly different from the local 
 32.23  tax rate that existed for the year of the delinquency.  
 32.24     Sec. 9.  Minnesota Statutes 1994, section 276.11, 
 32.25  subdivision 1, is amended to read: 
 32.26     Subdivision 1.  [GENERALLY.] As soon as practical after the 
 32.27  settlement day days determined in section 276.09, the county 
 32.28  treasurer shall pay to the state treasurer or the treasurer of a 
 32.29  town, city, school district, or special district, on the warrant 
 32.30  of the county auditor, all receipts of taxes levied by the 
 32.31  taxing district and deliver up all orders and other evidences of 
 32.32  indebtedness of the taxing district, taking triplicate receipts 
 32.33  for them.  The treasurer shall file one of the receipts with the 
 32.34  county auditor, and shall return one by mail on the day of its 
 32.35  receipt to the clerk of the town, city, school district, or 
 32.36  special district to which payment was made.  The clerk shall 
 33.1   keep the receipt in the clerk's office.  Upon written request of 
 33.2   the taxing district, to the extent practicable, the county 
 33.3   treasurer shall make partial payments of amounts collected 
 33.4   periodically in advance of the next settlement and 
 33.5   distribution.  A statement prepared by the county treasurer must 
 33.6   accompany each payment.  It must state the years for which taxes 
 33.7   included in the payment were collected and, for each year, the 
 33.8   amount of the taxes and any penalties on the tax.  Upon written 
 33.9   request of a taxing district, except school districts, the 
 33.10  county treasurer shall pay at least 70 percent of the estimated 
 33.11  collection within 30 days after the each settlement date 
 33.12  determined in section 276.09.  Within seven business days after 
 33.13  the due date, or 28 calendar days after the postmark date on the 
 33.14  envelopes containing real or personal property tax statements, 
 33.15  whichever is latest, the county treasurer shall pay to the 
 33.16  treasurer of the school districts 50 percent of the estimated 
 33.17  collections arising from taxes levied by and belonging to the 
 33.18  school district, unless the school district elects to receive 50 
 33.19  percent of the estimated collections arising from taxes levied 
 33.20  by and belonging to the school district after making a 
 33.21  proportionate reduction to reflect any loss in collections as 
 33.22  the result of any delay in mailing tax statements.  In that 
 33.23  case, 50 percent of those adjusted, estimated collections shall 
 33.24  be paid by the county treasurer to the treasurer of the school 
 33.25  district within seven business days of the due date.  The 
 33.26  remaining 50 percent of the estimated collections must be paid 
 33.27  to the treasurer of the school district within the next seven 
 33.28  business days of the later of the dates in the preceding 
 33.29  sentence, unless the school district elects to receive the 
 33.30  remainder of its estimated collections after a proportionate 
 33.31  reduction has been made to reflect any loss in collections as 
 33.32  the result of any delay in mailing tax statements.  In that 
 33.33  case, the remaining 50 percent of those adjusted, estimated 
 33.34  collections shall be paid by the county treasurer to the 
 33.35  treasurer of the school district within 14 days of the due 
 33.36  date.  The treasurer shall pay the balance of the amounts 
 34.1   collected to the state or to a municipal corporation or other 
 34.2   body within 60 days after the each settlement date determined in 
 34.3   section 276.09.  After 45 days interest at an annual rate of 
 34.4   eight percent accrues and must be paid to the taxing district.  
 34.5   Interest must be paid upon appropriation from the general 
 34.6   revenue fund of the county.  If not paid, it may be recovered by 
 34.7   the taxing district, in a civil action. 
 34.8      Sec. 10.  Minnesota Statutes 1994, section 276.111, is 
 34.9   amended to read: 
 34.10     276.111 [DISTRIBUTIONS AND FINAL YEAR-END SETTLEMENT.] 
 34.11     Within seven business days after October 15, the county 
 34.12  treasurer shall pay to the school districts 50 percent of the 
 34.13  estimated collections arising from taxes levied by and belonging 
 34.14  to the school district from the settlement day determined days 
 34.15  provided in section 276.09 to October 20.  The remaining 50 
 34.16  percent of the estimated tax collections must be paid to the 
 34.17  school district within the next seven business days.  Within ten 
 34.18  business days after November 15, the county treasurer shall pay 
 34.19  to the school district 100 percent of the estimated collections 
 34.20  arising from taxes levied by and belonging to the school 
 34.21  districts from October 20 to November 20. 
 34.22     Within ten business days after November 15, the county 
 34.23  treasurer shall pay to each taxing district, except any school 
 34.24  district, 100 percent of the estimated collections arising from 
 34.25  taxes levied by and belonging to each taxing district from the 
 34.26  settlement day determined days provided in section 276.09 to 
 34.27  November 20. 
 34.28     On or before January 5, the county treasurer shall make 
 34.29  full settlement with the county auditor of all receipts 
 34.30  collected from the settlement day determined days provided in 
 34.31  section 276.09 to December 31.  After subtracting any tax 
 34.32  distributions that have been made to the taxing districts in 
 34.33  October and November, the treasurer shall pay to each of the 
 34.34  taxing districts on or before January 25, the balance of the tax 
 34.35  amounts collected on behalf of each taxing district.  Interest 
 34.36  accrues at an annual rate of eight percent and must be paid to 
 35.1   the taxing district if this final settlement amount is not paid 
 35.2   by January 25.  Interest must be paid upon appropriation from 
 35.3   the general revenue fund of the county.  If not paid, it may be 
 35.4   recovered by the taxing district in a civil action. 
 35.5      Sec. 11.  Minnesota Statutes 1994, section 278.03, 
 35.6   subdivision 1, is amended to read: 
 35.7      Subdivision 1.  [REAL PROPERTY.] In the case of real 
 35.8   property, if the proceedings instituted by the filing of the 
 35.9   petition have not been completed before the 16th day of May next 
 35.10  following the filing, for all property the petitioner shall pay 
 35.11  to the county treasurer 50 34 percent of the tax levied for such 
 35.12  year against the property involved, unless permission to 
 35.13  continue prosecution of the petition without such payment is 
 35.14  obtained as herein provided. If the proceedings instituted by 
 35.15  the filing of the petition have not been completed by the 
 35.16  next July 16, the petitioner shall pay to the county treasurer 
 35.17  an additional 33 percent of the tax levied.  If the proceedings 
 35.18  instituted by the filing of the petition have not been completed 
 35.19  by October 16, or, in the case of class 1b 1 agricultural 
 35.20  homestead, class 2a agricultural homestead, and class 2b(2) 
 35.21  agricultural nonhomestead property, November 16, the petitioner 
 35.22  shall pay to the county treasurer 50 percent of the unpaid 
 35.23  balance of the taxes levied for the year against the property 
 35.24  involved if the unpaid balance is $2,000 or less and 80 percent 
 35.25  of the unpaid balance if the unpaid balance is over $2,000, 
 35.26  unless permission to continue prosecution of the petition 
 35.27  without payment is obtained as herein provided.  The petitioner, 
 35.28  upon ten days notice to the county attorney and to the county 
 35.29  auditor, given at least ten days prior to the 16th day of May or 
 35.30  the 16th day of July or the 16th day of October, or, in the case 
 35.31  of class 1b 1 agricultural homestead, class 2a agricultural 
 35.32  homestead, and class 2b(2) agricultural nonhomestead property, 
 35.33  the 16th day of November, may apply to the court for permission 
 35.34  to continue prosecution of the petition without payment; and, if 
 35.35  it is made to appear 
 35.36     (1) that the proposed review is to be taken in good faith; 
 36.1      (2) that there is probable cause to believe that the 
 36.2   property may be held exempt from the tax levied or that the tax 
 36.3   may be determined to be less than 50 percent of the amount 
 36.4   levied; and 
 36.5      (3) that it would work a hardship upon petitioner to pay 
 36.6   the taxes due, 
 36.7      the court may permit the petitioner to continue prosecution 
 36.8   of the petition without payment, or may fix a lesser amount to 
 36.9   be paid as a condition of continuing the prosecution of the 
 36.10  petition. 
 36.11     Failure to make payment of the amount required when due 
 36.12  shall operate automatically to dismiss the petition and all 
 36.13  proceedings thereunder unless the payment is waived by an order 
 36.14  of the court permitting the petitioner to continue prosecution 
 36.15  of the petition without payment.  The petition shall be 
 36.16  automatically reinstated upon payment of the entire tax plus 
 36.17  interest and penalty if the payment is made within one year of 
 36.18  the dismissal.  The county treasurer shall, upon request of the 
 36.19  petitioner, issue duplicate receipts for the tax payment, one of 
 36.20  which shall be filed by the petitioner in the proceeding. 
 36.21     Sec. 12.  Minnesota Statutes 1994, section 278.05, 
 36.22  subdivision 5, is amended to read: 
 36.23     Subd. 5.  Any time after the filing of the petition and 
 36.24  before the trial of the issues raised thereby, when the defense 
 36.25  or claim presented is that the property has been partially, 
 36.26  unfairly, or unequally assessed, or that the property has been 
 36.27  assessed at a valuation greater than its real or actual value, 
 36.28  or that a parcel which is classified as homestead class 1 or 2 
 36.29  agricultural or residential under the provisions of 
 36.30  section 273.13, subdivision 22 or 23 273.126, has been assessed 
 36.31  at a valuation which exceeds by ten percent or more the 
 36.32  valuation which the parcel would have if it were valued at the 
 36.33  average assessment/sales ratio for real property in the same 
 36.34  class in that portion of the county in which the parcel is 
 36.35  located, for which the commissioner is able to establish and 
 36.36  publish a sales ratio study, the attorney representing the 
 37.1   state, county, city or town in the proceedings may serve on the 
 37.2   petitioner, or the petitioner's attorney, and file with the 
 37.3   court administrator of the district court, an offer to reduce 
 37.4   the valuation of the property or a portion of the property to a 
 37.5   valuation set forth in the offer.  If, within ten days 
 37.6   thereafter, the petitioner, or the attorney, gives notice in 
 37.7   writing to the county attorney, or the attorney for the city or 
 37.8   town, that the offer is accepted, the official notified may file 
 37.9   the offer with proof of notice, and the court administrator 
 37.10  shall enter judgment accordingly.  Otherwise, the offer shall be 
 37.11  deemed withdrawn and evidence thereof shall not be given; and, 
 37.12  unless a lower valuation than specified in the offer is found by 
 37.13  the court, no costs or disbursements shall be allowed to the 
 37.14  petitioner, but the costs and disbursements of the state, 
 37.15  county, city or town, including interest at six percent on the 
 37.16  tax based on the amount of the offer from and after the 16th day 
 37.17  of October, or, in the case of class 1b 1 agricultural 
 37.18  homestead, class 2a agricultural homestead, class 2b(2) 
 37.19  agricultural nonhomestead property, and manufactured homes 
 37.20  treated as personal property, the 16th day of November, of the 
 37.21  year the taxes are payable, shall be taxed in its favor and 
 37.22  included in the judgment and when collected shall be credited to 
 37.23  the county revenue fund, unless the taxes were paid in full 
 37.24  before the 16th day of October, or, in the case of class 1b 
 37.25  agricultural homestead, class 2a agricultural homestead, and 
 37.26  class 2b(2) agricultural nonhomestead property, and manufactured 
 37.27  homes treated as personal property, the 16th day of November, of 
 37.28  the year in which the taxes were payable, in which event 
 37.29  interest shall not be taxable. 
 37.30     Sec. 13.  Minnesota Statutes 1994, section 279.01, is 
 37.31  amended by adding a subdivision to read: 
 37.32     Subd. 1a.  [DUE DATES.] All taxes on all real property are 
 37.33  due in three equal installments, to be paid on or before May 15, 
 37.34  or 20 calendar days after the postmark date on the envelope 
 37.35  containing the property tax statement, whichever is later, July 
 37.36  15, and October 15. 
 38.1      Sec. 14.  Minnesota Statutes 1994, section 279.01, is 
 38.2   amended by adding a subdivision to read: 
 38.3      Subd. 2a.  [PENALTIES.] Late payments of real property tax 
 38.4   incur a penalty.  The rate of the penalty increases with each 
 38.5   successive month that the payment is late and is dependent upon 
 38.6   the class of property taxed.  For purposes of the penalties 
 38.7   imposed under this subdivision, the market value of commercial 
 38.8   and industrial property classified under section 273.126, 
 38.9   subdivision 3, clauses (3) to (5), shall be considered class 4.  
 38.10  The following is the schedule of penalties for late payment of 
 38.11  property tax: 
 38.12  
 38.13  Property                May  June  July  Aug.  July  Aug.
 38.14                          16     1     1    1     16    16
 38.15  Class 1 and Class 2
 38.17  1st Installment
 38.18  (May 15)                4%     6%    7%   8%    --    8%  
 38.19   
 38.20  2nd Installment
 38.21  (July 15)                                       8%   10%
 38.23  3rd Installment  
 38.24  (October 15)  
 38.25    
 38.26    
 38.27    
 38.28  Class 3 and Class 4
 38.29    
 38.30  1st Installment 
 38.31  (May 15)                8%    10%   10%  10%    --   10%
 38.32    
 38.33  2nd Installment 
 38.34  (July 15)                                       8%   10%
 38.36  3rd Installment 
 38.37  (October 15) 
 38.38   
 38.39    
 38.40                  Sept.  Oct.   Nov.  Nov. Dec.  The first
 38.41                    1     16     1     16   1    business day
 38.42                                                 in January
 38.43  Class 1 and 
 38.44  Class 2
 38.46  1st Installment
 38.47  (May 15)         8%     8%    8%     --   8%    10%
 38.49  2nd Installment
 38.50  (July 15)        8%     8%    8%     --   8%    10%
 38.52  3rd Installment
 38.53  (October 15)            4%    8%     --   8%    10%
 38.54   
 38.55    
 38.56    
 38.57  Class 3 and 
 38.58  Class 4  
 38.59  
 38.60  1st Installment  
 39.1   (May 15)        12%    12%   12%     --  12%    14%
 39.2     
 39.3   2nd Installment 
 39.4   (July 15)       12%    12%   12%     --  12%    14% 
 39.5    
 39.6   3rd Installment 
 39.7   (October 15)            8%   10%    12%  12%    14%
 39.8      Sec. 15.  Minnesota Statutes 1994, section 279.01, is 
 39.9   amended by adding a subdivision to read: 
 39.10     Subd. 3a.  [EXTENDED DUE DATES.] Notwithstanding 
 39.11  subdivision 2a, if any of the due dates provided in subdivision 
 39.12  1a are extended as a result of a delay in mailing property tax 
 39.13  statements, no penalty accrues if the tax is paid by the 
 39.14  extended due date.  If the tax is not paid by the extended due 
 39.15  date, then all penalties that would have accrued if the due date 
 39.16  had not been extended must be charged. 
 39.17     Sec. 16.  [REPEALER.] 
 39.18     Minnesota Statutes 1994, section 279.01, subdivisions 1 and 
 39.19  3, are repealed. 
 39.20     Sec. 17.  [EFFECTIVE DATE.] 
 39.21     This article is effective for taxes levied in 1996, payable 
 39.22  in 1997, and thereafter. 
 39.23                             ARTICLE 4
 39.24                        LOCAL GOVERNMENT AID
 39.25     Section 1.  Minnesota Statutes 1994, section 477A.011, is 
 39.26  amended by adding a subdivision to read: 
 39.27     Subd. 25a.  [HOUSEHOLD POVERTY RATE.] "Household poverty 
 39.28  rate" for a city is 100 times the ratio of the number of 
 39.29  households in the city with income below the poverty level to 
 39.30  the total number of households in the city.  This ratio is based 
 39.31  on information from the most recently available federal census. 
 39.32     Sec. 2.  Minnesota Statutes 1994, section 477A.011, is 
 39.33  amended by adding a subdivision to read: 
 39.34     Subd. 25b.  [PER CAPITA CRIME RATE.] "Per capita crime rate"
 39.35  for a city is the number of part I criminal offenses, as defined 
 39.36  by the Minnesota department of public safety, for the most 
 39.37  recently available year, divided by the city's population.  If 
 39.38  data on part I criminal offenses are not available for a city, 
 39.39  its "per capita crime rate" is (1) the number of part I criminal 
 40.1   offenses in the county minus the part I criminal offenses in 
 40.2   cities in the county for which separate crime statistics are 
 40.3   reported; divided by (2) the county population minus the sum of 
 40.4   the population in cities for which separate crime statistics are 
 40.5   reported. 
 40.6      Sec. 3.  Minnesota Statutes 1994, section 477A.011, 
 40.7   subdivision 34, is amended to read: 
 40.8      Subd. 34.  [CITY REVENUE NEED.] (a) For a city with a 
 40.9   population equal to or greater than 2,500, "city revenue need" 
 40.10  is the sum of (1) 3.462312 2.748 times the pre-1940 housing 
 40.11  percentage; plus (2) 2.093826 times the commercial industrial 
 40.12  percentage 12.773 times the per capita crime rate; plus 
 40.13  (3) 6.862552 3.127 times the population decline percentage; plus 
 40.14  (4) .00026 .00027 times the city population; plus (5) 152.0141 
 40.15  2.385 times the household poverty rate; plus (6) 151.55. 
 40.16     (b) For a city with a population less than 2,500, "city 
 40.17  revenue need" is the sum of (1) 1.795919 times the pre-1940 
 40.18  housing percentage; plus (2) 1.562138 times the commercial 
 40.19  industrial percentage; plus (3) 4.177568 times the population 
 40.20  decline percentage; plus (4) 1.04013 times the transformed 
 40.21  population; minus (5) 107.475. 
 40.22     (c) The city revenue need cannot be less than zero. 
 40.23     (d) For calendar year 1995 and subsequent years, the city 
 40.24  revenue need for a city with a population less than 2,500, as 
 40.25  determined in paragraphs (a) to (c), is multiplied by the ratio 
 40.26  of the annual implicit price deflator for state and local 
 40.27  government purchases, as prepared by the United States 
 40.28  Department of Commerce, for the most recently available year to 
 40.29  the 1993 implicit price deflator for state and local government 
 40.30  purchases.  For calendar year 1997 and subsequent years, the 
 40.31  city revenue need for a city with a population of 2,500 or more, 
 40.32  as determined in paragraphs (a) to (c), is multiplied by the 
 40.33  ratio of the annual implicit price deflator for state and local 
 40.34  government purchases, as prepared by the United States 
 40.35  Department of Commerce, for the most recently available year to 
 40.36  the 1994 implicit price deflator for state and local government 
 41.1   purchases. 
 41.2      Sec. 4.  Minnesota Statutes 1994, section 477A.011, 
 41.3   subdivision 37, is amended to read: 
 41.4      Subd. 37.  [BASE REDUCTION PERCENTAGE.] "Base reduction 
 41.5   percentage" is (1) the difference between the amount available 
 41.6   for city aid under section 477A.03 for the year for which aid is 
 41.7   being calculated and the amount available for city aid under 
 41.8   section 477A.03 for calendar year 1994, (2) divided by the sum 
 41.9   of the city aid base for all cities and (3) multiplied by 100.  
 41.10  The reduction percentage for any year may not be less than the 
 41.11  reduction percentage from the previous year.  For aid paid in 
 41.12  calendar year 1994, the reduction percentage is zero.  The 
 41.13  reduction percentage may not be more than 100 percent zero for 
 41.14  aids payable in calendar year 1996, 20 percent for aids payable 
 41.15  in calendar year 1997, 40 percent for aids payable in calendar 
 41.16  year 1998, 60 percent for aids payable in calendar year 1999, 80 
 41.17  percent for aids payable in calendar year 2000, and 100 percent 
 41.18  for aids payable in calendar year 2001 and thereafter. 
 41.19     Sec. 5.  Minnesota Statutes 1994, section 477A.013, 
 41.20  subdivision 8, is amended to read: 
 41.21     Subd. 8.  [CITY FORMULA AID.] In calendar year 1994 1996 
 41.22  and subsequent years, the formula aid for a city is equal to the 
 41.23  need increase percentage multiplied by the difference between 
 41.24  (1) the city's revenue need multiplied by its population, and 
 41.25  (2) the sum of (i) the city's net tax capacity multiplied by the 
 41.26  tax effort rate, and (ii) the amount of any payments to the city 
 41.27  in the previous year under sections 298.28 and 298.82.  No city 
 41.28  may have a formula aid amount less than zero.  The need increase 
 41.29  percentage must be the same for all cities with a population 
 41.30  under 2,500.  The need increase percentage must be the same for 
 41.31  all cities with a population of 2,500 or more.  
 41.32     Notwithstanding the prior sentence, in 1995 only, the need 
 41.33  increase percentage for a city shall be twice the need increase 
 41.34  percentage applicable to other cities if:  
 41.35     (1) the city, in 1992 or 1993, transferred an amount from 
 41.36  governmental funds to their sewer and water fund, and 
 42.1      (2) the amount transferred exceeded their net levy for 
 42.2   taxes payable in the year in which the transfer occurred.  
 42.3      The applicable need increase percentage or percentages must 
 42.4   be calculated by the department of revenue so that the total of 
 42.5   the aid under subdivision 9, distributed to cities with a 
 42.6   population less than 2,500 and to cities with a population of 
 42.7   2,500 or more, equals the total amount available for aid to each 
 42.8   group of cities under section 477A.03.  
 42.9      Sec. 6.  Minnesota Statutes 1994, section 477A.013, 
 42.10  subdivision 9, is amended to read: 
 42.11     Subd. 9.  [CITY AID DISTRIBUTION.] (a) In calendar year 
 42.12  1994 1996 and thereafter, each city shall receive an aid 
 42.13  distribution equal to the sum of (1) the city formula aid under 
 42.14  subdivision 8, and (2) its city aid base multiplied by a 
 42.15  percentage equal to 100 percent minus the base reduction 
 42.16  percentage. 
 42.17     (b) The percentage increase for a first class city in 
 42.18  calendar year 1995 and thereafter shall not exceed the 
 42.19  percentage increase in the sum of the aid to all cities under 
 42.20  this section in the current calendar year compared to the sum of 
 42.21  the aid to all cities in the previous year. 
 42.22     (c) The total aid for any city, except a first class city, 
 42.23  shall not exceed the sum of (1) ten percent of the city's net 
 42.24  levy for the year prior to the aid distribution plus (2) its 
 42.25  total aid in the previous year before any increases or decreases 
 42.26  under sections 16A.711, subdivision 5, and 477A.0132. 
 42.27     (d) Notwithstanding paragraph (c), in 1995 only, for cities 
 42.28  which in 1992 or 1993 transferred an amount from governmental 
 42.29  funds to their sewer and water fund in an amount greater than 
 42.30  their net levy for taxes payable in the year in which the 
 42.31  transfer occurred, the total aid shall not exceed the sum of (1) 
 42.32  20 percent of the city's net levy for the year prior to the aid 
 42.33  distribution plus (2) its total aid in the previous year before 
 42.34  any increases or decreases under sections 16A.711, subdivision 
 42.35  5, and 477A.0132. 
 42.36     Sec. 7.  Minnesota Statutes 1994, section 477A.03, 
 43.1   subdivision 1, is amended to read: 
 43.2      Subdivision 1.  [ANNUAL APPROPRIATION.] A sum sufficient to 
 43.3   discharge the duties imposed by sections 477A.011 to 477A.014 is 
 43.4   annually appropriated from the local government trust fund to 
 43.5   the commissioner of revenue.  For aid payable in 1994, the total 
 43.6   aid paid to cities under section 477A.013, subdivision 9, is 
 43.7   limited to $330,636,900.  For aid payable in 1995, the total aid 
 43.8   paid to cities under section 477A.013, subdivision 9, is limited 
 43.9   to $337,249,600.  For aid payable in 1996 and thereafter, the 
 43.10  total aid paid to cities under section 477A.013, subdivision 9, 
 43.11  is limited to the amount paid in the previous year, adjusted for 
 43.12  inflation as provided under subdivision 3 $337,249,600 which 
 43.13  shall be apportioned between cities with a population less than 
 43.14  2,500 and cities with a population of 2,500 or more, based on 
 43.15  each group's share of the total city appropriation for aids 
 43.16  payable in 1995. 
 43.17     Aid payments to counties under section 477A.0121 are 
 43.18  limited to $8,400,000 in 1994 and $10,000,000 in 1995. For aid 
 43.19  payable in 1996 and thereafter, payments to counties under 
 43.20  section 477A.0121 are limited to the amount paid in the previous 
 43.21  year, adjusted for inflation as provided under subdivision 3. 
 43.22     For aid payable in 1995, payments to counties under section 
 43.23  477A.0122 are limited to $1,500,000.  For aids payable in 1996 
 43.24  and thereafter, payments to counties under section 477A.0122 are 
 43.25  limited to the amount paid in the previous year, adjusted for 
 43.26  inflation as provided under subdivision 3. 
 43.27     Sec. 8.  Minnesota Statutes 1994, section 477A.03, 
 43.28  subdivision 2, is amended to read: 
 43.29     Subd. 2.  [ANNUAL APPROPRIATION.] A sum sufficient to 
 43.30  discharge the duties imposed by sections 477A.011 to 477A.014 is 
 43.31  annually appropriated from the general fund to the commissioner 
 43.32  of revenue.  For aids payable in 1996 and thereafter, the total 
 43.33  aids paid under sections 477A.013, subdivision 9, 477A.0121, and 
 43.34  477A.0122 are the amounts certified to be paid in the previous 
 43.35  year, adjusted for inflation as provided under subdivision 3. 
 43.36     Sec. 9.  [EFFECTIVE DATE.] 
 44.1      Sections 1 to 8 are effective for aids payable in 1996 and 
 44.2   thereafter. 
 44.3                              ARTICLE 5
 44.4                      MUNICIPAL SERVICE CHARGES
 44.5      Section 1.  [429.102] [SERVICE CHARGES; TAX EXEMPT 
 44.6   PROPERTY.] 
 44.7      Subdivision 1.  [DEFINITIONS.] (a) For purposes of this 
 44.8   section, the following terms have the meanings given them. 
 44.9      (b) "Basic public services" means the amount expended by 
 44.10  the city for police, fire, sanitation, and other similar 
 44.11  property service related public services, as determined by 
 44.12  resolution of the city.  Basic public services does not include 
 44.13  any expenditures for improvements or services that are specially 
 44.14  assessed or charged under chapter 429, 430, 435, or the 
 44.15  provisions of any other law or charter. 
 44.16     (c) "Tax exempt property" means a building or part of a 
 44.17  building exempt from ad valorem property taxation under section 
 44.18  272.02 or other law, except: 
 44.19     (1) property owned and used by the federal government; 
 44.20     (2) all public school houses for elementary and secondary 
 44.21  education; 
 44.22     (3) academies, colleges, universities, and seminaries of 
 44.23  learning; 
 44.24     (4) houses of worship and other church property owned and 
 44.25  used exclusively for church purposes; 
 44.26     (5) property owned and used by an Indian tribe or tribal 
 44.27  corporation; 
 44.28     (6) property for which payments in lieu of property taxes 
 44.29  are made under any other law; or 
 44.30     (7) property on which a tax is imposed under section 
 44.31  272.01, subdivisions 2 and 3, 273.19, or any other law. 
 44.32     If properties are used for multiple uses some of which are 
 44.33  exempt and others taxable, the taxable part of the value of the 
 44.34  property must be determined using some appropriate apportionment 
 44.35  factor, such as the amount of use for exempt and nonexempt 
 44.36  purposes, as prescribed by the commissioner of revenue.  
 45.1      (d) "Qualifying costs" means basic public services 
 45.2   multiplied by a fraction.  The numerator of the fraction is the 
 45.3   city's levy for the current year.  The denominator of the 
 45.4   fraction is total city expenditures for the current year. 
 45.5      (e) "Qualifying value" means the total net tax capacity of 
 45.6   tax exempt property as defined in paragraph (c) in the city as 
 45.7   determined by the assessor under subdivision 3, divided by the 
 45.8   total net tax capacity of all taxable and tax exempt property in 
 45.9   the city.  For purposes of making this determination, the net 
 45.10  tax capacity of tax exempt property will be obtained by 
 45.11  multiplying the assessor's estimated market value of the exempt 
 45.12  property times a class rate of one percent. 
 45.13     (f) "City" means a home rule charter or statutory city. 
 45.14     Subd. 2.  [CITY SERVICE CHARGE.] A city may by resolution 
 45.15  impose a service charge to pay for the cost of providing basic 
 45.16  public services to tax exempt property.  If imposed, the service 
 45.17  charge must apply to all tax exempt property located within the 
 45.18  city and must be calculated as provided in this section.  The 
 45.19  resolution must be adopted by August 1 to be effective for 
 45.20  service charges payable the following year.  The city clerk 
 45.21  shall forward a copy of the resolution to the city and county 
 45.22  assessor, county auditor, and county treasurer of the county in 
 45.23  which the city is located within ten business days after 
 45.24  adoption of the resolution.  The city service charge imposed 
 45.25  under this section is in addition to any service charges imposed 
 45.26  under section 429.101. 
 45.27     Subd. 3.  [CALCULATION OF SERVICE CHARGE.] (a) The assessor 
 45.28  responsible for assessing taxable property in the city shall 
 45.29  determine at the time and in the manner specified for other 
 45.30  properties the net tax capacity of each tax exempt property as 
 45.31  defined in subdivision 1, paragraph (c), in the city with 
 45.32  reference to January 2 of the current year. 
 45.33     (b) The county auditor shall determine and multiply the 
 45.34  qualifying value for the city times the qualifying costs for the 
 45.35  city.  The product of the calculation is the service charge to 
 45.36  be allocated among all tax exempt properties in the city for the 
 46.1   current calendar year.  The amount of the service charge must be 
 46.2   allocated to each tax exempt property in the proportion that its 
 46.3   net tax capacity determined under paragraph (a) bears to the 
 46.4   total net tax capacity for the city.  The service charge must be 
 46.5   calculated and allocated to the individual properties by 
 46.6   December 31. 
 46.7      Subd. 4.  [PAYMENT.] A statement of the amount due under 
 46.8   subdivision 3 must be mailed to the owner of the tax exempt 
 46.9   property by February 1 of the succeeding year.  For the purpose 
 46.10  of mailing statements under this section, owners shall be those 
 46.11  shown on the records of the county auditor or any other records 
 46.12  the county deems appropriate.  Owners of the properties may 
 46.13  designate in writing to the county auditor the person and 
 46.14  address to which the statements must be mailed. 
 46.15     Payment must be made to the county treasurer on or before 
 46.16  May 15.  If the amount due exceeds $100, payment may be made in 
 46.17  two equal installments on or before May 15 and on or before July 
 46.18  15.  The city may provide by resolution an alternate payment 
 46.19  schedule if the schedule applies equally to all properties on 
 46.20  which a service charge is imposed under this section.  The 
 46.21  amounts received by the county under this section shall be 
 46.22  included in the property tax settlement distributions under 
 46.23  sections 276.11 and 276.111. 
 46.24     If the service charge is not paid by the due date, interest 
 46.25  accrues from the date the installment is due and is payable at 
 46.26  the rate determined under section 549.09.  Service charges 
 46.27  imposed under this section constitute a lien upon the property 
 46.28  on which they are imposed.  The liens attach and may be enforced 
 46.29  in the same manner and have the same priority as liens for 
 46.30  special assessments.  The city may enforce payment of the 
 46.31  charges in the same manner as other debts owed the city. 
 46.32     Subd. 5.  [APPROPRIATION.] The amount necessary to make the 
 46.33  payments required in this section by the state is annually 
 46.34  appropriated from the general fund to the commissioner of 
 46.35  revenue. 
 46.36     Sec. 2.  [EFFECTIVE DATE.] 
 47.1      Section 1 is effective for service charges imposed after 
 47.2   December 31, 1996. 
 47.3                              ARTICLE 6
 47.4                       STATE AID RESTRUCTURING
 47.5      Section 1.  Minnesota Statutes 1994, section 124.226, 
 47.6   subdivision 1, is amended to read: 
 47.7      Subdivision 1.  [BASIC TRANSPORTATION.] Each year, a school 
 47.8   district may levy for school transportation services an amount 
 47.9   not to exceed the amount raised by the basic transportation tax 
 47.10  rate times the adjusted net tax capacity of the district for the 
 47.11  preceding year.  The commissioner of education shall establish 
 47.12  the basic transportation tax rate by July 1 of each year for 
 47.13  levies payable in the following year.  The basic transportation 
 47.14  tax rate shall be a rate, rounded up to the nearest hundredth of 
 47.15  a percent, that, when applied to the adjusted net tax capacity 
 47.16  of taxable property for all districts, raises the amount 
 47.17  specified in this subdivision.  The basic transportation tax 
 47.18  rate for transportation shall be the rate that raises 
 47.19  $64,300,000 for fiscal year 1993 and, $68,000,000 for 
 47.20  fiscal year years 1994, 1995, 1996, and 1997, and $60,500,000 
 47.21  for fiscal year 1998, $53,000,000 for fiscal year 1999, 
 47.22  $45,500,000 for fiscal year 2000, $38,000,000 for fiscal year 
 47.23  2001, and $30,000,000 for fiscal year 2002 and subsequent fiscal 
 47.24  years.  The basic transportation tax rate certified by the 
 47.25  commissioner of education must not be changed due to changes or 
 47.26  corrections made to a district's adjusted net tax capacity after 
 47.27  the tax rate has been certified. 
 47.28     Sec. 2.  Minnesota Statutes 1994, section 124A.23, 
 47.29  subdivision 1, is amended to read: 
 47.30     Subdivision 1.  [GENERAL EDUCATION TAX RATE.] The 
 47.31  commissioner shall establish the general education tax rate by 
 47.32  July 1 of each year for levies payable in the following year.  
 47.33  The general education tax capacity rate shall be a rate, rounded 
 47.34  up to the nearest tenth of a percent, that, when applied to the 
 47.35  adjusted net tax capacity for all districts, raises the amount 
 47.36  specified in this subdivision.  The general education tax rate 
 48.1   shall be the rate that raises $1,044,000,000 for fiscal year 
 48.2   1995 and, $1,054,000,000 for fiscal year 1996, $954,000,000 for 
 48.3   fiscal year 1997, $904,000,000 for fiscal year 1998, 
 48.4   $856,000,000 for fiscal year 1999, $808,000,000 for fiscal year 
 48.5   2000, $760,000,000 for fiscal year 2001, and $712,000,000 for 
 48.6   fiscal year 2002 and later subsequent fiscal years.  The general 
 48.7   education tax rate may not be changed due to changes or 
 48.8   corrections made to a district's adjusted net tax capacity after 
 48.9   the tax rate has been established.  
 48.10     Sec. 3.  Minnesota Statutes 1994, section 145A.13, 
 48.11  subdivision 2, is amended to read: 
 48.12     Subd. 2.  [LOCAL MATCH.] Each community health board that 
 48.13  receives a subsidy shall provide local matching money equal 
 48.14  to that one-half of the subsidy amount during the year for which 
 48.15  the subsidy is made, subject to the following provisions: 
 48.16     (a) the local matching funds may include local tax levies, 
 48.17  gifts, fees for services, and revenues from contracts; 
 48.18     (b) when the amount of local matching funds for a community 
 48.19  health board is less than the amount specified, the subsidy 
 48.20  provided for that community health board under this section 
 48.21  shall be reduced proportionally; 
 48.22     (c) when a community health board fails to expend the full 
 48.23  amount of the subsidy to which it would be entitled in any one 
 48.24  year under the provisions of sections 145A.09 to 145A.13, the 
 48.25  state commissioner of health may retain the surplus, subject to 
 48.26  disbursement to the community health board in the following 
 48.27  calendar year if the community health board can demonstrate a 
 48.28  need for and ability to expend the surplus for the purposes 
 48.29  provided in section 145A.10; and 
 48.30     (d) a city organized under the provisions of sections 
 48.31  145A.09 to 145A.13 that levies a tax for provision of community 
 48.32  health services shall be exempted from any county levy for the 
 48.33  same services to the extent of the levy imposed by the city. 
 48.34     Sec. 4.  Minnesota Statutes 1994, section 256E.06, 
 48.35  subdivision 5, is amended to read: 
 48.36     Subd. 5.  [COMMUNITY SOCIAL SERVICE LEVY.] In each calendar 
 49.1   year, for taxes payable the following year, a county board shall 
 49.2   levy upon all taxable property in the county a tax for community 
 49.3   social services at least equal to one-half of the amount 
 49.4   determined in subdivisions 1 and 2.  Money for community social 
 49.5   services provided to a county by a municipal levy may, for the 
 49.6   purposes of this section, be counted as partial fulfillment of 
 49.7   the local levy requirement.  All money available to counties 
 49.8   pursuant to this section may be used by counties to match 
 49.9   federal money.  It is the intention of the legislature that the 
 49.10  aid paid to counties under this section be used to provide 
 49.11  property tax relief within the county. 
 49.12     Sec. 5.  Minnesota Statutes 1994, section 256E.06, 
 49.13  subdivision 12, is amended to read: 
 49.14     Subd. 12.  [APPROPRIATION.] $51,566,000 is appropriated 
 49.15  from the local government trust fund in fiscal year 1993, 
 49.16  $50,762,000 in fiscal year 1994, $49,499,000 in fiscal year 
 49.17  1995, and $50,499,000 $37,875,000 for the first three payments 
 49.18  in fiscal year 1996 and thereafter to the commissioner of human 
 49.19  services for payment of aid under this section.  
 49.20     Notwithstanding subdivisions 1 and 2, the increased 
 49.21  appropriation available in fiscal year calendar years 1995 and 
 49.22  1996 and thereafter must be used to increase each county's aid 
 49.23  proportionately over the aid received in calendar year 1994.  
 49.24  For calendar year 1995 only, each county's aid will be adjusted 
 49.25  to reflect the increase that is required to occur in the second 
 49.26  half of the calendar year. 
 49.27     In fiscal year 1997 and subsequent years, the amount 
 49.28  appropriated shall be the amount appropriated under this section 
 49.29  in the previous year, adjusted for inflation as provided under 
 49.30  section 477A.03, subdivision 3.  The following amounts are 
 49.31  appropriated from the general fund to the commissioner of human 
 49.32  services for payment of aid under this section:  $50,500,000 in 
 49.33  calendar year 1996, $61,000,000 in calendar year 1997, 
 49.34  $71,000,000 in calendar year 1998, $81,000,000 in calendar year 
 49.35  1999, $91,000,000 in calendar year 2000, and $101,000,000 in 
 49.36  calendar year 2001 and subsequent years. 
 50.1      Sec. 6.  Minnesota Statutes 1994, section 273.1398, 
 50.2   subdivision 2, is amended to read: 
 50.3      Subd. 2.  [HOMESTEAD AND AGRICULTURAL CREDIT AID.] For aids 
 50.4   payable in 1995, homestead and agricultural credit aid for each 
 50.5   unique taxing jurisdiction equals the product of (1) the 
 50.6   homestead and agricultural credit aid base, and (2) the growth 
 50.7   adjustment factor, plus the net tax capacity adjustment and the 
 50.8   fiscal disparity adjustment.  
 50.9      Homestead and agricultural credit aid for aids payable in 
 50.10  1996 shall be determined as follows:  for each special taxing 
 50.11  district, an amount equal to homestead and agricultural credit 
 50.12  aid payable in 1995; for each county, an amount equal to 
 50.13  homestead and agricultural credit aid for aids payable in 1995, 
 50.14  minus three percent of the county's 1994 adjusted net tax 
 50.15  capacity, determined according to section 124.2131; for each 
 50.16  city or town, an amount equal to homestead and agricultural 
 50.17  credit aid for aids payable in 1995, minus two percent of the 
 50.18  city's or town's 1994 adjusted net tax capacity, determined 
 50.19  according to section 124.2131; for each school district, an 
 50.20  amount equal to homestead and agricultural credit aid for aids 
 50.21  payable in 1995, minus one percent of the school district's 1994 
 50.22  adjusted net tax capacity, determined according to section 
 50.23  124.2131. 
 50.24     Homestead and agricultural credit aid for all taxing 
 50.25  jurisdictions for aids payable in 1997 through 2000 shall be 
 50.26  determined as the following percentages of aid payable in 1996:  
 50.27  for aids payable in 1997, 80 percent; for aids payable in 1998, 
 50.28  60 percent; for aids payable in 1999, 40 percent; and for aids 
 50.29  payable in 2000, 20 percent. 
 50.30     Sec. 7.  Minnesota Statutes 1994, section 273.1398, 
 50.31  subdivision 3, is amended to read: 
 50.32     Subd. 3.  [DISPARITY REDUCTION AID.] For taxes payable in 
 50.33  1995, and subsequent years 1996, the amount of disparity aid 
 50.34  certified for each taxing district within each unique taxing 
 50.35  jurisdiction for taxes payable in the prior year shall be 
 50.36  multiplied by the ratio of (1) the jurisdiction's tax capacity 
 51.1   using the class rates for taxes payable in the year for which 
 51.2   aid is being computed, to (2) its tax capacity using the class 
 51.3   rates for taxes payable in the year prior to that for which aid 
 51.4   is being computed, both based upon market values for taxes 
 51.5   payable in the year prior to that for which aid is being 
 51.6   computed.  For the purposes of this aid determination, disparity 
 51.7   reduction aid certified for taxes payable in the prior year for 
 51.8   a taxing entity other than a town or school district is deemed 
 51.9   to be county government disparity reduction aid.  For taxes 
 51.10  payable in 1992 and subsequent years, the amount of disparity 
 51.11  aid certified to each taxing jurisdiction shall be reduced by 
 51.12  any reductions required in the current year or permanent 
 51.13  reductions required in previous years under section 477A.0132. 
 51.14     Disparity reduction aid for all taxing jurisdictions for 
 51.15  aids payable in 1997 through 2000 shall be determined as the 
 51.16  following percentages of aids payable in 1996:  for aids payable 
 51.17  in 1997, 80 percent; for aids payable in 1998, 60 percent; for 
 51.18  aids payable in 1999, 40 percent; and for aids payable in 2000, 
 51.19  20 percent. 
 51.20     Sec. 8.  [COMMUNITY HEALTH SERVICES APPROPRIATION.] 
 51.21     The following amounts are appropriated from the general 
 51.22  fund to the commissioner of health to provide subsidies under 
 51.23  Minnesota Statutes, section 145A.13:  $16,900,000 for fiscal 
 51.24  year 1998, $19,700,000 for fiscal year 1999, $22,500,000 for 
 51.25  fiscal year 2000, $25,300,000 for fiscal year 2001, and 
 51.26  $28,200,000 for fiscal year 2002. 
 51.27     Sec. 9.  [APPROPRIATION; ADMINISTRATIVE COSTS.] 
 51.28     $5,000,000 is appropriated for fiscal year 1996 from the 
 51.29  general fund to the commissioner of revenue to reimburse 
 51.30  counties for costs of compliance with this act.  This 
 51.31  appropriation must be apportioned among the counties and 
 51.32  distributed by the commissioner of revenue in the same manner 
 51.33  that the appropriation in Laws 1988, chapter 719, article 5, 
 51.34  section 85, was apportioned and distributed. 
 51.35     Sec. 10.  [REPEALER.] 
 51.36     (a) Minnesota Statutes 1994, sections 273.1398, and 275.08, 
 52.1   subdivisions 1c and 1d, are repealed. 
 52.2      (b) Minnesota Statutes 1994, section 256E.06, subdivision 
 52.3   2, is repealed. 
 52.4      Sec. 11.  [EFFECTIVE DATE.] 
 52.5      Sections 1, 2, and 4, are effective for property taxes 
 52.6   payable in 1997, and thereafter.  Section 3 is effective January 
 52.7   1, 1997, and thereafter.  Sections 5 and 7 are effective July 1, 
 52.8   1995, and thereafter.  Section 10, paragraph (a), is effective 
 52.9   for taxes payable 2001 and subsequent years.  Section 10, 
 52.10  paragraph (b), is effective for distributions for calendar year 
 52.11  1997, and subsequent years. 
 52.12                             ARTICLE 7
 52.13                  EDUCATION REFORM AND COOPERATION
 52.14     Section 1.  [124A.32] [COLLABORATION AID.] 
 52.15     Subdivision 1.  [PURPOSE.] The purpose of this section is 
 52.16  to provide an incentive for school districts, local social 
 52.17  services and health providers, and other community-based groups 
 52.18  to work together to transform fragmented, crisis-oriented 
 52.19  delivery systems focused on remediation services into flexible, 
 52.20  comprehensive, well-coordinated and family-oriented delivery 
 52.21  systems focused on prevention services. 
 52.22     Subd. 2.  [ELIGIBILITY.] To receive collaboration aid under 
 52.23  this section, the school district must: 
 52.24     (1) be actively participating in accordance with section 
 52.25  256E.09, subdivision 3a, in discussions and planning of the 
 52.26  community social services act plan and the community health 
 52.27  services plan with the appropriate county official, community 
 52.28  education official, and community-based service groups as 
 52.29  defined in section 256E.03, subdivision 1a; 
 52.30     (2) enter into a written agreement with the county board or 
 52.31  boards where the school district is located.  The agreement must 
 52.32  describe the roles of the county and school district in 
 52.33  providing prevention, and early intervention and outreach 
 52.34  services for children and families which have been developed 
 52.35  collaboratively between the county and school districts.  A 
 52.36  group of counties and school districts may develop a joint 
 53.1   collaborative plan under this section.  The county shall also 
 53.2   include these collaborative activities in the plan developed 
 53.3   under section 256E.08.  When approved by the county and the 
 53.4   school district, the plan developed under section 256E.08 
 53.5   satisfies the requirements of this section for the biennial 
 53.6   period covered in the plan; and 
 53.7      (3) match the collaborative aid locally at 50 percent with 
 53.8   funds provided by a county, city, school district, community 
 53.9   education program, or private donors. 
 53.10     Subd. 3.  [AID AMOUNT.] Each year, collaboration aid for an 
 53.11  eligible district equals $1.65 times the district's actual pupil 
 53.12  units for that year. 
 53.13     Subd. 4.  [AID USES.] Aid received under subdivision 2 may 
 53.14  be used for parental involvement programs, career teacher 
 53.15  programs, coordination of volunteer services, and programs 
 53.16  designed to encourage community involvement. 
 53.17     Before expending collaboration aid, the school district 
 53.18  shall develop a list of objectively measurable outcomes to be 
 53.19  achieved by the expenditure.  The school district shall annually 
 53.20  submit the list to the county boards in the counties in which it 
 53.21  is located and to the department of education and report to the 
 53.22  department of education and counties in which it is located on 
 53.23  actual performance of its programs in comparison to the defined 
 53.24  outcomes. 
 53.25     Subd. 5.  [EVALUATION REPORT.] The commissioner of 
 53.26  education shall report to the education committees of the 
 53.27  legislature and the legislative committee on children, youth, 
 53.28  and their families annually by February 15 on the extent to 
 53.29  which school districts that receive aid under this section 
 53.30  achieved their listed outcomes. 
 53.31     Sec. 2.  [APPROPRIATIONS.] 
 53.32     $....... is appropriated in fiscal year 1997 from the 
 53.33  general fund to the commissioner of education for payment of 
 53.34  collaboration aid under section 1. 
 53.35     Sec. 3.  [EFFECTIVE DATE.] 
 53.36     Section 1 is effective July 1, 1996, for revenue for 
 54.1   1996-1997, and later school years. 
 54.2                              ARTICLE 8
 54.3               STATE FINANCING OF COURT ADMINISTRATORS
 54.4      Section 1.  Minnesota Statutes 1994, section 43A.02, 
 54.5   subdivision 25, is amended to read: 
 54.6      Subd. 25.  [JUDICIAL BRANCH.] "Judicial branch" means all 
 54.7   judges of the appellate courts, all employees of the appellate 
 54.8   courts, including commissions, boards, and committees 
 54.9   established by the supreme court, the board of law examiners, 
 54.10  the law library, the office of the state public defender, 
 54.11  district public defenders and their employees, all judges of all 
 54.12  courts of law, district court referees, judicial officers, court 
 54.13  reporters, law clerks, district administration employees under 
 54.14  section 484.68, court administrator or employee of the court and 
 54.15  guardian ad litem program employees in the eighth judicial 
 54.16  district administrators or their staff under chapter 485, and 
 54.17  other agencies placed in the judicial branch by law.  Judicial 
 54.18  branch does not include district administration or public 
 54.19  defenders or their employees in the second and fourth judicial 
 54.20  districts, court administrators or their staff under chapter 
 54.21  485, guardians ad litem, or other employees within the court 
 54.22  system whose salaries are paid by the county, other than 
 54.23  employees who remain on the county payroll under section 
 54.24  480.181, subdivision 2.  
 54.25     Sec. 2.  Minnesota Statutes 1994, section 43A.24, 
 54.26  subdivision 2, is amended to read: 
 54.27     Subd. 2.  [OTHER ELIGIBLE PERSONS.] The following persons 
 54.28  are eligible for state paid life insurance and hospital, 
 54.29  medical, and dental benefits as determined in applicable 
 54.30  collective bargaining agreements or by the commissioner or by 
 54.31  plans pursuant to section 43A.18, subdivision 6, or by the board 
 54.32  of regents for employees of the University of Minnesota not 
 54.33  covered by collective bargaining agreements.  Coverages made 
 54.34  available, including optional coverages, are as contained in the 
 54.35  plan established pursuant to section 43A.18, subdivision 2: 
 54.36     (a) a member of the state legislature, provided that 
 55.1   changes in benefits resulting in increased costs to the state 
 55.2   shall not be effective until expiration of the term of the 
 55.3   members of the existing house of representatives.  An eligible 
 55.4   member of the state legislature may decline to be enrolled for 
 55.5   state paid coverages by filing a written waiver with the 
 55.6   commissioner.  The waiver shall not prohibit the member from 
 55.7   enrolling the member or dependents for optional coverages, 
 55.8   without cost to the state, as provided for in section 43A.26.  A 
 55.9   member of the state legislature who returns from a leave of 
 55.10  absence to a position previously occupied in the civil service 
 55.11  shall be eligible to receive the life insurance and hospital, 
 55.12  medical, and dental benefits to which the position is entitled; 
 55.13     (b) a permanent employee of the legislature or a permanent 
 55.14  employee of a permanent study or interim committee or commission 
 55.15  or a state employee on leave of absence to work for the 
 55.16  legislature, during a regular or special legislative session; 
 55.17     (c) a judge of the appellate courts or an officer or 
 55.18  employee of these courts; a judge of the district court, a judge 
 55.19  of county court, a judge of county municipal court, or a judge 
 55.20  of probate court; a district court referee, judicial officer, 
 55.21  court reporter, or law clerk; a district administrator; an 
 55.22  employee of the office of the district administrator that is not 
 55.23  in the second or fourth judicial district; a court administrator 
 55.24  or an employee of the office of the court administrator in the 
 55.25  eighth judicial district, and a guardian ad litem program 
 55.26  administrator in the eighth judicial district; 
 55.27     (d) a salaried employee of the public employees retirement 
 55.28  association; 
 55.29     (e) a full-time military or civilian officer or employee in 
 55.30  the unclassified service of the department of military affairs 
 55.31  whose salary is paid from state funds; 
 55.32     (f) a salaried employee of the Minnesota historical 
 55.33  society, whether paid from state funds or otherwise, who is not 
 55.34  a member of the governing board; 
 55.35     (g) an employee of the regents of the University of 
 55.36  Minnesota; 
 56.1      (h) notwithstanding section 43A.27, subdivision 3, an 
 56.2   employee of the state of Minnesota or the regents of the 
 56.3   University of Minnesota who is at least 60 and not yet 65 years 
 56.4   of age on July 1, 1982, who is otherwise eligible for employee 
 56.5   and dependent insurance and benefits pursuant to section 43A.18 
 56.6   or other law, who has at least 20 years of service and retires, 
 56.7   earlier than required, within 60 days of March 23, 1982; or an 
 56.8   employee who is at least 60 and not yet 65 years of age on July 
 56.9   1, 1982, who has at least 20 years of state service and retires, 
 56.10  earlier than required, from employment at Rochester state 
 56.11  hospital after July 1, 1981; or an employee who is at least 55 
 56.12  and not yet 65 years of age on July 1, 1982, and is covered by 
 56.13  the Minnesota state retirement system correctional employee 
 56.14  retirement plan or the state patrol retirement fund, who has at 
 56.15  least 20 years of state service and retires, earlier than 
 56.16  required, within 60 days of March 23, 1982.  For purposes of 
 56.17  this clause, a person retires when the person terminates active 
 56.18  employment in state or University of Minnesota service and 
 56.19  applies for a retirement annuity.  Eligibility shall cease when 
 56.20  the retired employee attains the age of 65, or when the employee 
 56.21  chooses not to receive the annuity that the employee has applied 
 56.22  for.  The retired employee shall be eligible for coverages to 
 56.23  which the employee was entitled at the time of retirement, 
 56.24  subject to any changes in coverage through collective bargaining 
 56.25  or plans established pursuant to section 43A.18, for employees 
 56.26  in positions equivalent to that from which retired, provided 
 56.27  that the retired employee shall not be eligible for state-paid 
 56.28  life insurance.  Coverages shall be coordinated with relevant 
 56.29  health insurance benefits provided through the federally 
 56.30  sponsored Medicare program; 
 56.31     (i) an employee of an agency of the state of Minnesota 
 56.32  identified through the process provided in this paragraph who is 
 56.33  eligible to retire prior to age 65.  The commissioner and the 
 56.34  exclusive representative of state employees shall enter into 
 56.35  agreements under section 179A.22 to identify employees whose 
 56.36  positions are in programs that are being permanently eliminated 
 57.1   or reduced due to federal or state policies or practices.  
 57.2   Failure to reach agreement identifying these employees is not 
 57.3   subject to impasse procedures provided in chapter 179A.  The 
 57.4   commissioner must prepare a plan identifying eligible employees 
 57.5   not covered by a collective bargaining agreement in accordance 
 57.6   with the process outlined in section 43A.18, subdivisions 2 and 
 57.7   3.  For purposes of this paragraph, a person retires when the 
 57.8   person terminates active employment in state service and applies 
 57.9   for a retirement annuity.  Eligibility ends as provided in the 
 57.10  agreement or plan, but must cease at the end of the month in 
 57.11  which the retired employee chooses not to receive an annuity, or 
 57.12  the employee is eligible for employer-paid health insurance from 
 57.13  a new employer.  The retired employees shall be eligible for 
 57.14  coverages to which they were entitled at the time of retirement, 
 57.15  subject to any changes in coverage through collective bargaining 
 57.16  or plans established under section 43A.18 for employees in 
 57.17  positions equivalent to that from which they retired, provided 
 57.18  that the retired employees shall not be eligible for state-paid 
 57.19  life insurance; and 
 57.20     (j) employees of the state public defender's office, and 
 57.21  district public defenders and their employees other than in the 
 57.22  second and fourth judicial districts, with eligibility 
 57.23  determined by the state board of public defense in consultation 
 57.24  with the commissioner of employee relations. 
 57.25     Sec. 3.  Minnesota Statutes 1994, section 97A.065, 
 57.26  subdivision 2, is amended to read: 
 57.27     Subd. 2.  [FINES AND FORFEITED BAIL.] (a) Fines and 
 57.28  forfeited bail collected from prosecutions of violations of the 
 57.29  game and fish laws, sections 84.09 to 84.15, and 84.81 to 84.88, 
 57.30  chapter 348, and any other law relating to wild animals, and 
 57.31  aquatic vegetation must be paid to the state treasurer of the 
 57.32  county where the violation is prosecuted.  The county treasurer 
 57.33  shall submit.  One-half of the receipts shall be credited to the 
 57.34  commissioner and credit the balance credited to the county state 
 57.35  general revenue fund except as provided in paragraphs (b), (c), 
 57.36  and (d).  
 58.1      (b) The commissioner must reimburse a county, from the game 
 58.2   and fish fund, for the cost of keeping prisoners prosecuted for 
 58.3   violations under this section if the county board, by 
 58.4   resolution, directs:  (1) the county treasurer to submit all 
 58.5   fines and forfeited bail to the commissioner; and (2) the county 
 58.6   auditor to certify and submit monthly itemized statements to the 
 58.7   commissioner.  
 58.8      (c) The county treasurer shall indicate the amount of the 
 58.9   receipts that are assessments or surcharges imposed under 
 58.10  section 609.101 and shall submit all of those receipts to the 
 58.11  commissioner.  The receipts must be credited to the game and 
 58.12  fish fund to provide peace officer training for persons employed 
 58.13  by the commissioner who are licensed under section 626.84, 
 58.14  subdivision 1, clause (c), and who possess peace officer 
 58.15  authority for the purpose of enforcing game and fish laws. 
 58.16     (d) The county treasurer court administrator shall submit 
 58.17  one-half of the receipts collected from prosecutions of 
 58.18  violations of sections 84.81 to 84.91, including receipts that 
 58.19  are assessments or surcharges imposed under section 609.101, to 
 58.20  the commissioner and credit the balance to the county state 
 58.21  general fund.  The commissioner shall credit these receipts to 
 58.22  the snowmobile trails and enforcement account in the natural 
 58.23  resources fund. 
 58.24     Sec. 4.  Minnesota Statutes 1994, section 299D.03, 
 58.25  subdivision 5, is amended to read: 
 58.26     Subd. 5.  [FINES AND FORFEITED BAIL MONEY.] (a) All fines 
 58.27  and forfeited bail money, from traffic and motor vehicle law 
 58.28  violations, collected from persons apprehended or arrested by 
 58.29  officers of the state patrol, shall be paid by the person or 
 58.30  officer collecting the fines, forfeited bail money or 
 58.31  installments thereof, on or before the tenth day after the last 
 58.32  day of the month in which these moneys were collected, to the 
 58.33  county state treasurer of the county where the violation 
 58.34  occurred.  Three-eighths of these receipts shall be credited to 
 58.35  the general revenue fund of the county state.  The other 
 58.36  five-eighths of these receipts shall be transmitted by that 
 59.1   officer to the state treasurer and shall be credited as follows: 
 59.2      (1) In the fiscal year ending June 30, 1991, the first 
 59.3   $275,000 in money received by the state treasurer after June 4, 
 59.4   1991, must be credited to the transportation services fund, and 
 59.5   the remainder in the fiscal year credited to the trunk highway 
 59.6   fund. 
 59.7      (2) In fiscal year 1992, the first $215,000 in money 
 59.8   received by the state treasurer in the fiscal year must be 
 59.9   credited to the transportation services fund, and the remainder 
 59.10  credited to the trunk highway fund. 
 59.11     (3) In fiscal years 1993 1998 and subsequent years, the 
 59.12  entire amount received by the state treasurer must be credited 
 59.13  to the trunk highway fund.  If, however, the violation occurs 
 59.14  within a municipality and the city attorney prosecutes the 
 59.15  offense, and a plea of not guilty is entered, one-third of the 
 59.16  receipts shall be credited to the general revenue fund of 
 59.17  the county state, one-third of the receipts shall be paid to the 
 59.18  municipality prosecuting the offense, and one-third shall be 
 59.19  transmitted to the state treasurer as provided in this 
 59.20  subdivision.  All costs of participation in a nationwide police 
 59.21  communication system chargeable to the state of Minnesota shall 
 59.22  be paid from appropriations for that purpose. 
 59.23     (b) Notwithstanding any other provisions of law, all fines 
 59.24  and forfeited bail money from violations of statutes governing 
 59.25  the maximum weight of motor vehicles, collected from persons 
 59.26  apprehended or arrested by employees of the state of Minnesota, 
 59.27  by means of stationary or portable scales operated by these 
 59.28  employees, shall be paid by the person or officer collecting the 
 59.29  fines or forfeited bail money, on or before the tenth day after 
 59.30  the last day of the month in which the collections were made, to 
 59.31  the county treasurer of the county where the violation 
 59.32  occurred.  Five-eighths of these receipts shall be transmitted 
 59.33  by that officer to the state treasurer and shall be credited to 
 59.34  the highway user tax distribution fund.  Three-eighths of these 
 59.35  receipts shall be credited to the general revenue fund of the 
 59.36  county state.  
 60.1      Sec. 5.  Minnesota Statutes 1994, section 466.01, 
 60.2   subdivision 6, is amended to read: 
 60.3      Subd. 6.  [EMPLOYEE, OFFICER, OR AGENT.] For the purposes 
 60.4   of sections 466.01 to 466.15, "employee," "officer," or "agent" 
 60.5   means a present or former employee, officer, or agent of a 
 60.6   municipality, or other person acting on behalf of the 
 60.7   municipality in an official capacity, temporarily or 
 60.8   permanently, with or without compensation, but does not include 
 60.9   an independent contractor.  "Employee" includes court 
 60.10  administrators and their staff under chapter 485, district 
 60.11  administration staff in the second and fourth judicial 
 60.12  districts, guardians ad litem, and other employees within the 
 60.13  court system whose salaries are paid by the county, other than 
 60.14  employees who remain on the county payroll under section 
 60.15  480.181, subdivision 2. 
 60.16     Sec. 6.  Minnesota Statutes 1994, section 480.181, 
 60.17  subdivision 1, is amended to read: 
 60.18     Subdivision 1.  [STATE EMPLOYEES; COMPENSATION.] District 
 60.19  court referees, judicial officers, court reporters, law 
 60.20  clerks, and district administration staff, other than district 
 60.21  administration staff in the second and fourth judicial 
 60.22  districts, and court administration employees are state 
 60.23  employees and are governed by the judicial branch personnel 
 60.24  rules adopted by the supreme court.  The supreme court, in 
 60.25  consultation with the conference of chief judges, shall 
 60.26  establish the salary range of these employees under the judicial 
 60.27  branch personnel rules.  In establishing the salary ranges, the 
 60.28  supreme court shall consider differences in the cost of living 
 60.29  in different areas of the state. 
 60.30     Sec. 7.  Minnesota Statutes 1994, section 485.01, is 
 60.31  amended to read: 
 60.32     485.01 [APPOINTMENT; BOND; DUTIES.] 
 60.33     A clerk of the district court for each county within the 
 60.34  judicial district, who shall be known as the court 
 60.35  administrator, shall be appointed by a majority of the district 
 60.36  court judges in the district, after consultation with the county 
 61.1   court judges of the county court district affected.  The clerk, 
 61.2   before entering upon the duties of office, shall give bond to 
 61.3   the state, to be approved by the chief judge of the judicial 
 61.4   district, conditioned for the faithful discharge of official 
 61.5   duties.  The bond, with an oath of office, shall be filed for 
 61.6   record with the county recorder.  The clerk shall perform all 
 61.7   duties assigned by law and by the rules of the court.  The clerk 
 61.8   and all deputy clerks must not practice as attorneys in the 
 61.9   court in which they are employed. 
 61.10     The duties, functions, and responsibilities which have been 
 61.11  and may be required by law or rule to be performed by the clerk 
 61.12  of district or county court shall be performed by the court 
 61.13  administrator. 
 61.14     Sec. 8.  Minnesota Statutes 1994, section 485.018, 
 61.15  subdivision 2a, is amended to read: 
 61.16     Subd. 2a.  [WITHHOLDING SALARY.] Upon certification by the 
 61.17  state court administrator that the court administrator of 
 61.18  district court has failed to perform any of the duties assigned 
 61.19  by law or by rule of court, the county board supreme court shall 
 61.20  withhold the salary of the court administrator, and shall not 
 61.21  pay the salary until receipt of notice from the state court 
 61.22  administrator that the court administrator has performed the 
 61.23  duties assigned by law or by rule of court. 
 61.24     Nothing in this subdivision shall be construed to prohibit 
 61.25  the judges of the district court from removing a court 
 61.26  administrator of district court from office. 
 61.27     Sec. 9.  Minnesota Statutes 1994, section 485.018, 
 61.28  subdivision 5, is amended to read: 
 61.29     Subd. 5.  [COLLECTION OF FEES.] The court administrator of 
 61.30  district court shall charge and collect all fees as prescribed 
 61.31  by law and all such fees collected by the court administrator as 
 61.32  court administrator of district court shall be paid to 
 61.33  the county state treasurer.  Except for those portions of 
 61.34  forfeited bail paid to victims pursuant to existing law, the 
 61.35  county treasurer shall forward all revenue from fees and 
 61.36  forfeited bail collected under chapters 357, 487, and 574, and 
 62.1   the county portion of each fine to the state treasurer for 
 62.2   deposit in the state treasury and credit to the general fund, 
 62.3   unless otherwise provided in chapter 611A or other law, in the 
 62.4   manner and at the times prescribed by the state treasurer, but 
 62.5   not less often than once each month.  Money that is collected by 
 62.6   the court administrator under chapter 357, 487, or 574, and not 
 62.7   required by law to be distributed to a city, must be paid to the 
 62.8   state treasurer for deposit in the state treasury and credit to 
 62.9   the general fund.  If the defendant or probationer is located 
 62.10  after forfeited bail proceeds have been forwarded to the state 
 62.11  treasurer, the state treasurer shall reimburse the county, on 
 62.12  request, for actual costs expended for extradition, 
 62.13  transportation, or other costs necessary to return the defendant 
 62.14  or probationer to the jurisdiction where the bail was posted, in 
 62.15  an amount not more than the amount of forfeited bail.  All other 
 62.16  money must be deposited in the county general fund unless 
 62.17  otherwise provided by law.  The court administrator of district 
 62.18  court shall not retain any additional compensation, per diem or 
 62.19  other emolument for services as court administrator of district 
 62.20  court, but may receive and retain mileage and expense allowances 
 62.21  as prescribed by law. 
 62.22     Sec. 10.  Minnesota Statutes 1994, section 485.018, 
 62.23  subdivision 6, is amended to read: 
 62.24     Subd. 6.  [BUDGET FOR OFFICE.] The county board by 
 62.25  resolution shall provide the budget for (1) the salaries of 
 62.26  deputies, court administrators and other employees in the office 
 62.27  of the court administrator of district court; (2) and other 
 62.28  expenses necessary in the performance of the duties of said 
 62.29  office and (3) the payment of premiums of any bonds required of 
 62.30  the court administrator of district court or any deputy, court 
 62.31  administrator or employee in said office and the board is 
 62.32  authorized to appropriate funds therefor and for the salary of 
 62.33  the court administrator of district court shall be paid by the 
 62.34  state.  A county shall provide office facilities for the court 
 62.35  administrator. 
 62.36     Sec. 11.  Minnesota Statutes 1994, section 485.021, is 
 63.1   amended to read: 
 63.2      485.021 [INVESTMENT OF FUNDS DEPOSITED WITH COURT 
 63.3   ADMINISTRATOR.] 
 63.4      When money is paid into court pursuant to court order, the 
 63.5   court administrator of district court, unless the court order 
 63.6   specifies otherwise, may place such moneys with the county state 
 63.7   treasurer for investment, as provided by law.  When such moneys 
 63.8   are subsequently released, or otherwise treated, by court order, 
 63.9   the same shall be immediately paid over by the county state 
 63.10  treasurer to the court administrator of district court who shall 
 63.11  then fulfill the direction of the court order relative to such 
 63.12  moneys. 
 63.13     Sec. 12.  Minnesota Statutes 1994, section 487.32, 
 63.14  subdivision 3, is amended to read: 
 63.15     Subd. 3.  A judge of a county court may order any sums 
 63.16  forfeited to be reinstated and the county state treasurer shall 
 63.17  then refund accordingly.  The county state treasurer shall 
 63.18  reimburse the court administrator if the court administrator 
 63.19  refunds the deposit upon a judge's order and obtains a receipt 
 63.20  to be used as a voucher.  
 63.21     Sec. 13.  Minnesota Statutes 1994, section 574.34, 
 63.22  subdivision 1, is amended to read: 
 63.23     Subdivision 1.  [GENERAL.] Fines and forfeitures not 
 63.24  specially granted or appropriated by law and not required to be 
 63.25  distributed to a city by statute shall be paid into the treasury 
 63.26  of the county where they are incurred to the state treasurer for 
 63.27  deposit in the state treasury and credit to the general fund. 
 63.28     Sec. 14.  [REPEALER.] 
 63.29     Minnesota Statutes 1994, sections 485.018, subdivisions 1, 
 63.30  2, 4, and 8; 485.03; 485.05; and 485.11, are repealed. 
 63.31     Sec. 15.  [EFFECTIVE DATE.] 
 63.32     This article is effective January 1, 1997, and thereafter.