HF 1564

as introduced - 83rd Legislature (2003 - 2004) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to local government aids; changing the 
  1.3             formula for city aids; amending Minnesota Statutes 
  1.4             2002, sections 477A.011, subdivisions 20, 34, by 
  1.5             adding subdivisions; 477A.013, subdivisions 8, 9; 
  1.6             477A.03, subdivision 2; repealing Minnesota Statutes 
  1.7             2002, section 477A.011, subdivisions 33, 36, 37. 
  1.8   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.9      Section 1.  Minnesota Statutes 2002, section 477A.011, 
  1.10  subdivision 20, is amended to read: 
  1.11     Subd. 20.  [CITY NET TAX CAPACITY.] "City net tax capacity" 
  1.12  means (1) the net tax capacity computed using the net tax 
  1.13  capacity rates in section 273.13 for taxes payable in the year 
  1.14  of the aid distribution, and the market values for taxes payable 
  1.15  in the year prior to the aid distribution plus (2) a city's 
  1.16  fiscal disparities distribution tax capacity under section 
  1.17  276A.06, subdivision 2, paragraph (b), or 473F.08, subdivision 
  1.18  2, paragraph (b), for taxes payable in the year prior to that 
  1.19  for which aids are being calculated.  The market value utilized 
  1.20  in computing city net tax capacity shall be reduced by the sum 
  1.21  of (1) a city's market value of commercial industrial property 
  1.22  as defined in section 276A.01, subdivision 3, or 473F.02, 
  1.23  subdivision 3, multiplied by the ratio determined pursuant to 
  1.24  section 276A.06, subdivision 2, paragraph (a), or 473F.08, 
  1.25  subdivision 2, paragraph (a), (2) the market value of the 
  1.26  captured value of tax increment financing districts as defined 
  2.1   in section 469.177, subdivision 2, and (3) (2) the market value 
  2.2   of transmission lines deducted from a city's total net tax 
  2.3   capacity under section 273.425.  The city net tax capacity will 
  2.4   be computed using equalized market values.  
  2.5      [EFFECTIVE DATE.] This section is effective for aids 
  2.6   payable in 2004 and subsequent years. 
  2.7      Sec. 2.  Minnesota Statutes 2002, section 477A.011, 
  2.8   subdivision 34, is amended to read: 
  2.9      Subd. 34.  [CITY REVENUE NEED.] (a) For a city with a 
  2.10  population equal to or greater than 2,500 2,900, "city revenue 
  2.11  need per capita" is the sum of (1) 3.462312 4.94244 times the 
  2.12  pre-1940 housing percentage; plus (2) 2.093826 1.51141 times the 
  2.13  commercial industrial percentage; plus (3) 6.862552 16.91385 
  2.14  times the population decline percentage; plus less (4) .00026 
  2.15  times the city population 62.045 times the average household 
  2.16  size; plus (5) 152.0141 388.758. 
  2.17     (b) For a city with a population less than 2,500, "city 
  2.18  revenue need per capita" is the sum of (1) 1.795919 times the 
  2.19  pre-1940 housing percentage; plus (2) 1.562138 times the 
  2.20  commercial industrial percentage; plus (3) 4.177568 times the 
  2.21  population decline percentage; plus (4) 1.04013 times the 
  2.22  transformed population; minus (5) 107.475 357 for aids payable 
  2.23  in 2004.  For aids payable in 2005 and future years, the "city 
  2.24  revenue base per capita" is equal to (1) the city revenue base 
  2.25  per capita under this paragraph in the previous year, multiplied 
  2.26  by (2) one plus the percentage increase in the implicit price 
  2.27  deflator for government consumption expenditures and gross 
  2.28  investment for state and local governments prepared by the 
  2.29  Bureau of Economic Analysis of the United States Department of 
  2.30  Commerce for the 12-month period ending March 31 of the previous 
  2.31  year. 
  2.32     (c) For a city with a population greater or equal to 2,500 
  2.33  but less than 2,600, the "city revenue need per capita" is equal 
  2.34  to 20 percent of its "city revenue need per capita" calculated 
  2.35  under paragraph (a) and 80 percent of its city revenue need 
  2.36  calculated under paragraph (b). 
  3.1      (d) For a city with a population greater or equal to 2,600 
  3.2   but less than 2,700, the "city revenue need per capita" is equal 
  3.3   to 40 percent of its "city revenue need per capita" calculated 
  3.4   under paragraph (a) and 60 percent of its city revenue need 
  3.5   calculated under paragraph (b). 
  3.6      (e) For a city with a population greater or equal to 2,700 
  3.7   but less than 2,800, the "city revenue need per capita" is equal 
  3.8   to 60 percent of its "city revenue need per capita" calculated 
  3.9   under paragraph (a) and 40 percent of its city revenue need 
  3.10  calculated under paragraph (b). 
  3.11     (f) For a city with a population greater or equal to 2,800 
  3.12  but less than 2,900, the "city revenue need per capita" is equal 
  3.13  to 80 percent of its "city revenue need per capita" calculated 
  3.14  under paragraph (a) and 20 percent of its city revenue need 
  3.15  calculated under paragraph (b). 
  3.16     (g) The city revenue need cannot be less than zero. 
  3.17     (d) For calendar year 1998 and subsequent years, the city 
  3.18  revenue need for a city, as determined in paragraphs (a) to (c), 
  3.19  is multiplied by the ratio of the annual implicit price deflator 
  3.20  for government consumption expenditures and gross investment for 
  3.21  state and local governments as prepared by the United States 
  3.22  Department of Commerce, for the most recently available year to 
  3.23  the 1993 implicit price deflator for state and local government 
  3.24  purchases. 
  3.25     [EFFECTIVE DATE.] This section is effective beginning with 
  3.26  aids payable in 2004. 
  3.27     Sec. 3.  Minnesota Statutes 2002, section 477A.011, is 
  3.28  amended by adding a subdivision to read: 
  3.29     Subd. 38.  [AVERAGE HOUSEHOLD SIZE.] "Average household 
  3.30  size" for a city is the city's population divided by the number 
  3.31  of households in the city, based on the most recently available 
  3.32  population and number of households estimates from the state 
  3.33  demographer or a federal census. 
  3.34     [EFFECTIVE DATE.] This section is effective beginning with 
  3.35  aids payable in 2004. 
  3.36     Sec. 4.  Minnesota Statutes 2002, section 477A.011, is 
  4.1   amended by adding a subdivision to read: 
  4.2      Subd. 39.  [EXEMPT PROPERTY.] "Exempt property" is the sum 
  4.3   of the market value of exempt property, as reported in the most 
  4.4   recently available abstract of exempt property in the following 
  4.5   categories: 
  4.6      (1) buildings, residences, and land of public and nonpublic 
  4.7   academies, colleges, and universities; 
  4.8      (2) buildings, residences, and land of public and nonpublic 
  4.9   hospitals; 
  4.10     (3) buildings and land of federal and state forests, parks, 
  4.11  and wildlife refuges; 
  4.12     (4) federal buildings and lands; 
  4.13     (5) state buildings and lands except for buildings and 
  4.14  lands used for correctional facilities; and 
  4.15     (6) county buildings and lands except for buildings and 
  4.16  lands used for public service enterprises. 
  4.17     [EFFECTIVE DATE.] This section is effective beginning with 
  4.18  aids payable in 2004. 
  4.19     Sec. 5.  Minnesota Statutes 2002, section 477A.011, is 
  4.20  amended by adding a subdivision to read: 
  4.21     Subd. 40.  [EXCESS EXEMPT PROPERTY PER CAPITA.] "Excess 
  4.22  exempt property per capita" is the difference between (1) the 
  4.23  city's exempt property divided by the city's population for the 
  4.24  same year that the exempt property was reported, and (2) the sum 
  4.25  of exempt property for all cities divided by the sum of 
  4.26  population for cities for the same year that the exempt property 
  4.27  was reported.  No city may have an excess exempt property per 
  4.28  capita less than zero. 
  4.29     [EFFECTIVE DATE.] This section is effective beginning with 
  4.30  aids payable in 2004. 
  4.31     Sec. 6.  Minnesota Statutes 2002, section 477A.013, 
  4.32  subdivision 8, is amended to read: 
  4.33     Subd. 8.  [CITY FORMULA AID.] In calendar year 1994 2004 
  4.34  and subsequent years, the formula aid for a city is equal to the 
  4.35  need increase percentage multiplied by the difference between 
  4.36  (1) the city's revenue need per capita multiplied by its 
  5.1   population, and (2) the city's net tax capacity multiplied by 
  5.2   the tax effort rate plus the amount of taconite aids under 
  5.3   sections 298.28 and 298.282.  No city may have a formula aid 
  5.4   amount less than zero.  The need increase percentage must be the 
  5.5   same for all cities.  
  5.6      Notwithstanding the prior sentence, in 1995 only, the need 
  5.7   increase percentage for a city shall be twice the need increase 
  5.8   percentage applicable to other cities if:  
  5.9      (1) the city, in 1992 or 1993, transferred an amount from 
  5.10  governmental funds to their sewer and water fund, and 
  5.11     (2) the amount transferred exceeded their net levy for 
  5.12  taxes payable in the year in which the transfer occurred. 
  5.13     The applicable need increase percentage or percentages must 
  5.14  be calculated by the department of revenue so that the total of 
  5.15  the aid under subdivision 9 equals the total amount available 
  5.16  for aid under section 477A.03.  
  5.17     [EFFECTIVE DATE.] This section is effective beginning with 
  5.18  aids payable in 2004. 
  5.19     Sec. 7.  Minnesota Statutes 2002, section 477A.013, 
  5.20  subdivision 9, is amended to read: 
  5.21     Subd. 9.  [CITY AID DISTRIBUTION.] (a) In calendar year 
  5.22  2002 2004 and thereafter, each city shall receive an aid 
  5.23  distribution equal to the sum of (1) the city formula aid under 
  5.24  subdivision 8, and (2) its city aid base the product of (i) one 
  5.25  percent of the city's excess exempt property per capita, (ii) 
  5.26  its population, and (iii) the tax effort rate. 
  5.27     (b) The percentage increase for a first class city in 
  5.28  calendar year 1995 and thereafter, except for 2002, shall not 
  5.29  exceed the percentage increase in the sum of the aid to all 
  5.30  cities under this section in the current calendar year compared 
  5.31  to the sum of the aid to all cities in the previous year.  For 
  5.32  aids payable in 2002 only, the amount of the aid paid to a first 
  5.33  class city shall not exceed the sum of its aid amount for 
  5.34  calendar year 2001 under this section and its aid payment in 
  5.35  calendar year 2001 under section 273.1398, subdivision 2, by 
  5.36  more than 2.5 percent.  The aid paid to a city under this 
  6.1   section in any year may not exceed the amount the city received 
  6.2   in the previous year by more than $50 per capita.  The aid paid 
  6.3   to a city under this section in any year may not be more than 
  6.4   $50 per capita less than the amount that the city received in 
  6.5   the previous year. 
  6.6      (c) For aids payable in all years except 2002, the total 
  6.7   aid for any city, except a first class city, shall not exceed 
  6.8   the sum of (1) ten percent of the city's net levy for the year 
  6.9   prior to the aid distribution plus (2) its total aid in the 
  6.10  previous year.  For aids payable in 2002 only, the total aid for 
  6.11  any city, except a first class city, shall not exceed the sum of 
  6.12  (1) 40 percent of the city's net levy for taxes payable in the 
  6.13  year prior to the aid distribution plus (2) 40 percent of its 
  6.14  total aid in the previous year under section 273.1398, 
  6.15  subdivision 2, plus (3) its total aid in the previous year under 
  6.16  this section. 
  6.17     [EFFECTIVE DATE.] This section is effective beginning with 
  6.18  aids payable in 2004. 
  6.19     Sec. 8.  Minnesota Statutes 2002, section 477A.03, 
  6.20  subdivision 2, is amended to read: 
  6.21     Subd. 2.  [ANNUAL APPROPRIATION.] (a) A sum sufficient to 
  6.22  discharge the duties imposed by sections 477A.011 to 477A.014 is 
  6.23  annually appropriated from the general fund to the commissioner 
  6.24  of revenue.  
  6.25     (b) Aid payments to counties under section 477A.0121 are 
  6.26  limited to $20,265,000 in 1996.  Aid payments to counties under 
  6.27  section 477A.0121 are limited to $27,571,625 in 1997.  For aid 
  6.28  payable in 1998 and thereafter, the total aids paid under 
  6.29  section 477A.0121 are the amounts certified to be paid in the 
  6.30  previous year, adjusted for inflation as provided under 
  6.31  subdivision 3. 
  6.32     (c)(i) For aids payable in 1998 and thereafter, the total 
  6.33  aids paid to counties under section 477A.0122 are the amounts 
  6.34  certified to be paid in the previous year, adjusted for 
  6.35  inflation as provided under subdivision 3. 
  6.36     (ii) Aid payments to counties under section 477A.0122 in 
  7.1   2000 are further increased by an additional $20,000,000 in 2000. 
  7.2      (d) Aid payments to cities in 2002 under section 477A.013, 
  7.3   subdivision 9, are limited to the amounts certified to be paid 
  7.4   in the previous year, adjusted for inflation as provided in 
  7.5   subdivision 3, and increased by $140,000,000.  For aids payable 
  7.6   in 2003, the total aids paid under section 477A.013, subdivision 
  7.7   9, are the amounts certified to be paid in the previous year, 
  7.8   adjusted for inflation as provided under subdivision 3.  For 
  7.9   aids payable in 2004, the total aids paid under section 
  7.10  477A.013, subdivision 9, are the amounts certified to be paid in 
  7.11  the previous year, adjusted for inflation as provided under 
  7.12  subdivision 3, and increased by the amount certified to be paid 
  7.13  in 2003 under section 477A.06.  For aids payable in 2005 and 
  7.14  thereafter, the total aids paid under section 477A.013, 
  7.15  subdivision 9, are the amounts certified to be paid in the 
  7.16  previous year, adjusted for inflation as provided under 
  7.17  subdivision 3.  The additional amount authorized under 
  7.18  subdivision 4 is not included when calculating the appropriation 
  7.19  limits under this paragraph. 
  7.20     (e) Reimbursements made to counties under section 477A.0123 
  7.21  in calendar year 2005 and thereafter are limited to an amount 
  7.22  equal to the maximum allowed appropriation under this section in 
  7.23  the previous year, multiplied by a percent to be established by 
  7.24  law.  If no percent is established by law, the appropriation is 
  7.25  limited to the total amount appropriated for this purpose in the 
  7.26  previous year. 
  7.27     [EFFECTIVE DATE.] This section is effective beginning with 
  7.28  aids payable in 2004. 
  7.29     Sec. 9.  [REPEALER.] 
  7.30     Minnesota Statutes 2002, section 477A.011, subdivisions 33, 
  7.31  36, and 37, are repealed. 
  7.32     [EFFECTIVE DATE.] This section is effective beginning with 
  7.33  aids payable in 2004.