HF 1650

as introduced - 85th Legislature (2007 - 2008) Posted on 12/15/2009 12:00am

A bill for an act
relating to taxation; providing a tax-free renaissance zone for the site of the
Fergus Falls regional treatment center campus; amending Minnesota Statutes
2006, sections 272.02, by adding a subdivision; 290.01, subdivisions 19b, as
amended, 29; 290.06, by adding subdivisions; 290.091, subdivision 2; 290.0921,
subdivision 3; 290.0922, subdivision 2; proposing coding for new law in
Minnesota Statutes, chapter 469.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2006, section 272.02, is amended by adding a
subdivision to read:

new text begin Subd. 85. new text end

new text begin Tax-free renaissance zones. new text end

new text begin (a) Property located in a tax-free renaissance
zone designated under section 469.342 is exempt from ad valorem taxes levied under
chapter 275.
new text end

new text begin (b) The exemption applies to each assessment year beginning during the duration
of the zone or subzone. For the final three assessment years of the zone or subzone
duration limit, the exemption applies to the following percentages of estimated market
value of the property:
new text end

new text begin (1) for the third to the last assessment year of the duration, 75 percent;
new text end

new text begin (2) for the second to the last assessment year of the duration, 50 percent; and
new text end

new text begin (3) for the last assessment year of the duration, 25 percent.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for property taxes levied in 2007,
payable in 2008, and thereafter.
new text end

Sec. 2.

Minnesota Statutes 2006, section 290.01, subdivision 19b, as amended by Laws
2007, chapter 1, section 2, is amended to read:

Subd. 19b.

Subtractions from federal taxable income.

For individuals, estates,
and trusts, there shall be subtracted from federal taxable income:

(1) net interest income on obligations of any authority, commission, or
instrumentality of the United States to the extent includable in taxable income for federal
income tax purposes but exempt from state income tax under the laws of the United States;

(2) if included in federal taxable income, the amount of any overpayment of income
tax to Minnesota or to any other state, for any previous taxable year, whether the amount
is received as a refund or as a credit to another taxable year's income tax liability;

(3) the amount paid to others, less the amount used to claim the credit allowed under
section 290.0674, not to exceed $1,625 for each qualifying child in grades kindergarten
to 6 and $2,500 for each qualifying child in grades 7 to 12, for tuition, textbooks, and
transportation of each qualifying child in attending an elementary or secondary school
situated in Minnesota, North Dakota, South Dakota, Iowa, or Wisconsin, wherein a
resident of this state may legally fulfill the state's compulsory attendance laws, which
is not operated for profit, and which adheres to the provisions of the Civil Rights Act
of 1964 and chapter 363A. For the purposes of this clause, "tuition" includes fees or
tuition as defined in section 290.0674, subdivision 1, clause (1). As used in this clause,
"textbooks" includes books and other instructional materials and equipment purchased
or leased for use in elementary and secondary schools in teaching only those subjects
legally and commonly taught in public elementary and secondary schools in this state.
Equipment expenses qualifying for deduction includes expenses as defined and limited in
section 290.0674, subdivision 1, clause (3). "Textbooks" does not include instructional
books and materials used in the teaching of religious tenets, doctrines, or worship, the
purpose of which is to instill such tenets, doctrines, or worship, nor does it include books
or materials for, or transportation to, extracurricular activities including sporting events,
musical or dramatic events, speech activities, driver's education, or similar programs. For
purposes of the subtraction provided by this clause, "qualifying child" has the meaning
given in section 32(c)(3) of the Internal Revenue Code;

(4) income as provided under section 290.0802;

(5) to the extent included in federal adjusted gross income, income realized on
disposition of property exempt from tax under section 290.491;

(6) to the extent not deducted or not deductible pursuant to section 408(d)(8)(E)
of the Internal Revenue Code in determining federal taxable income by an individual
who does not itemize deductions for federal income tax purposes for the taxable year, an
amount equal to 50 percent of the excess of charitable contributions over $500 allowable
as a deduction for the taxable year under section 170(a) of the Internal Revenue Code and
under the provisions of Public Law 109-1;

(7) for taxable years beginning before January 1, 2008, the amount of the federal
small ethanol producer credit allowed under section 40(a)(3) of the Internal Revenue Code
which is included in gross income under section 87 of the Internal Revenue Code;

(8) for individuals who are allowed a federal foreign tax credit for taxes that do not
qualify for a credit under section 290.06, subdivision 22, an amount equal to the carryover
of subnational foreign taxes for the taxable year, but not to exceed the total subnational
foreign taxes reported in claiming the foreign tax credit. For purposes of this clause,
"federal foreign tax credit" means the credit allowed under section 27 of the Internal
Revenue Code, and "carryover of subnational foreign taxes" equals the carryover allowed
under section 904(c) of the Internal Revenue Code minus national level foreign taxes to
the extent they exceed the federal foreign tax credit;

(9) in each of the five tax years immediately following the tax year in which an
addition is required under subdivision 19a, clause (7), or 19c, clause (15), in the case
of a shareholder of a corporation that is an S corporation, an amount equal to one-fifth
of the delayed depreciation. For purposes of this clause, "delayed depreciation" means
the amount of the addition made by the taxpayer under subdivision 19a, clause (7), or
subdivision 19c, clause (15), in the case of a shareholder of an S corporation, minus the
positive value of any net operating loss under section 172 of the Internal Revenue Code
generated for the tax year of the addition. The resulting delayed depreciation cannot be
less than zero;

(10) job opportunity building zone income as provided under section 469.316;

(11) the amount of compensation paid to members of the Minnesota National Guard
or other reserve components of the United States military for active service performed
in Minnesota, excluding compensation for services performed under the Active Guard
Reserve (AGR) program. For purposes of this clause, "active service" means (i) state
active service as defined in section 190.05, subdivision 5a, clause (1); (ii) federally
funded state active service as defined in section 190.05, subdivision 5b; or (iii) federal
active service as defined in section 190.05, subdivision 5c, but "active service" excludes
services performed exclusively for purposes of basic combat training, advanced individual
training, annual training, and periodic inactive duty training; special training periodically
made available to reserve members; and service performed in accordance with section
190.08, subdivision 3;

(12) the amount of compensation paid to Minnesota residents who are members
of the armed forces of the United States or United Nations for active duty performed
outside Minnesota;

(13) an amount, not to exceed $10,000, equal to qualified expenses related to a
qualified donor's donation, while living, of one or more of the qualified donor's organs
to another person for human organ transplantation. For purposes of this clause, "organ"
means all or part of an individual's liver, pancreas, kidney, intestine, lung, or bone marrow;
"human organ transplantation" means the medical procedure by which transfer of a human
organ is made from the body of one person to the body of another person; "qualified
expenses" means unreimbursed expenses for both the individual and the qualified donor
for (i) travel, (ii) lodging, and (iii) lost wages net of sick pay, except that such expenses
may be subtracted under this clause only once; and "qualified donor" means the individual
or the individual's dependent, as defined in section 152 of the Internal Revenue Code. An
individual may claim the subtraction in this clause for each instance of organ donation for
transplantation during the taxable year in which the qualified expenses occur;

(14) in each of the five tax years immediately following the tax year in which an
addition is required under subdivision 19a, clause (8), or 19c, clause (16), in the case of a
shareholder of a corporation that is an S corporation, an amount equal to one-fifth of the
addition made by the taxpayer under subdivision 19a, clause (8), or 19c, clause (16), in the
case of a shareholder of a corporation that is an S corporation, minus the positive value of
any net operating loss under section 172 of the Internal Revenue Code generated for the
tax year of the addition. If the net operating loss exceeds the addition for the tax year, a
subtraction is not allowed under this clause;

(15) to the extent included in federal taxable income, compensation paid to a
nonresident who is a service member as defined in United States Code, title 10, section
101(a)(5), for military service as defined in the Service Member Civil Relief Act, Public
Law 108-189, section 101(2); deleted text begin and
deleted text end

(16) international economic development zone income as provided under section
469.325 deleted text begin . deleted text end new text begin ; and
new text end

new text begin (17) income of a qualified business derived from operations in a tax-free renaissance
zone as provided under section 469.343.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after
December 31, 2007.
new text end

Sec. 3.

Minnesota Statutes 2006, section 290.01, subdivision 29, is amended to read:

Subd. 29.

Taxable income.

The term "taxable income" means:

(1) for individuals, estates, and trusts, the same as taxable net income;

(2) for corporations, the taxable net income less

(i) the net operating loss deduction under section 290.095;

(ii) the dividends received deduction under section 290.21, subdivision 4;

(iii) the exemption for operating in a job opportunity building zone under section
469.317;

(iv) the exemption for operating in a biotechnology and health sciences industry
zone under section 469.337; deleted text begin and
deleted text end

(v) the exemption for operating in an international economic development zone
under section 469.326 deleted text begin . deleted text end new text begin ; and
new text end

new text begin (vi) the exemption for operating in a tax-free renaissance zone under section 469.343.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after
December 31, 2007.
new text end

Sec. 4.

Minnesota Statutes 2006, section 290.06, is amended by adding a subdivision
to read:

new text begin Subd. 34. new text end

new text begin Tax-free renaissance zone; historic rehabilitation credit. new text end

new text begin (a) A
taxpayer who incurs costs that are eligible for a credit under section 47 of the Internal
Revenue Code for the rehabilitation of a property in a tax-free renaissance zone,
designated under section 469.342, is allowed a credit against the tax imposed under this
chapter, including the taxes under sections 290.091 and 290.0922, equal to 25 percent
of the federal credit for the taxable year.
new text end

new text begin (b) If the amount of the credit under this subdivision exceeds the tax liability under
this chapter for the year in which the cost is incurred, the amount that exceeds the tax
liability may be carried back to any of the three preceding taxable years or carried forward
to each of the ten taxable years succeeding the taxable year in which the expense was
incurred. The entire amount of the credit must be carried to the earliest taxable year to
which the amount may be carried. The unused portion of the credit must be carried to
the following taxable year.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after
December 31, 2007.
new text end

Sec. 5.

Minnesota Statutes 2006, section 290.06, is amended by adding a subdivision
to read:

new text begin Subd. 35. new text end

new text begin Tax-free renaissance zone; residents' credit. new text end

new text begin Each individual who is a
resident of the tax-free renaissance zone designated under section 469.342 on the last day
of the taxable year is allowed a credit against the tax imposed by this chapter, including
the tax imposed under section 290.091, for the taxable year equal to $10,000. The credit
applies to each taxable year beginning during the duration of the zone or subzone. For the
final three years of the duration of the zone or subzone, the following credit amounts apply:
new text end

new text begin (1) for taxable years beginning during the third to the last calendar year of the
duration, the credit equals $7,500;
new text end

new text begin (2) for taxable years beginning during the second to the last calendar year of the
duration, the credit equals $5,000; and
new text end

new text begin (3) for taxable years beginning during the last calendar year of the duration, the
credit equals $2,500.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after
December 31, 2007.
new text end

Sec. 6.

Minnesota Statutes 2006, section 290.091, subdivision 2, is amended to read:

Subd. 2.

Definitions.

For purposes of the tax imposed by this section, the following
terms have the meanings given:

(a) "Alternative minimum taxable income" means the sum of the following for
the taxable year:

(1) the taxpayer's federal alternative minimum taxable income as defined in section
55(b)(2) of the Internal Revenue Code;

(2) the taxpayer's itemized deductions allowed in computing federal alternative
minimum taxable income, but excluding:

(i) the charitable contribution deduction under section 170 of the Internal Revenue
Code:

(A) for taxable years beginning before January 1, 2006, to the extent that the
deduction exceeds 1.0 percent of adjusted gross income;

(B) for taxable years beginning after December 31, 2005, to the full extent of the
deduction.

For purposes of this clause, "adjusted gross income" has the meaning given in
section 62 of the Internal Revenue Code;

(ii) the medical expense deduction;

(iii) the casualty, theft, and disaster loss deduction; and

(iv) the impairment-related work expenses of a disabled person;

(3) for depletion allowances computed under section 613A(c) of the Internal
Revenue Code, with respect to each property (as defined in section 614 of the Internal
Revenue Code), to the extent not included in federal alternative minimum taxable income,
the excess of the deduction for depletion allowable under section 611 of the Internal
Revenue Code for the taxable year over the adjusted basis of the property at the end of the
taxable year (determined without regard to the depletion deduction for the taxable year);

(4) to the extent not included in federal alternative minimum taxable income, the
amount of the tax preference for intangible drilling cost under section 57(a)(2) of the
Internal Revenue Code determined without regard to subparagraph (E);

(5) to the extent not included in federal alternative minimum taxable income, the
amount of interest income as provided by section 290.01, subdivision 19a, clause (1); and

(6) the amount of addition required by section 290.01, subdivision 19a, clauses
(7), (8), and (9);

less the sum of the amounts determined under the following:

(1) interest income as defined in section 290.01, subdivision 19b, clause (1);

(2) an overpayment of state income tax as provided by section 290.01, subdivision
19b, clause (2), to the extent included in federal alternative minimum taxable income;

(3) the amount of investment interest paid or accrued within the taxable year on
indebtedness to the extent that the amount does not exceed net investment income, as
defined in section 163(d)(4) of the Internal Revenue Code. Interest does not include
amounts deducted in computing federal adjusted gross income; and

(4) amounts subtracted from federal taxable income as provided by section 290.01,
subdivision 19b, clauses (9) to deleted text begin (16) deleted text end new text begin (17) new text end .

In the case of an estate or trust, alternative minimum taxable income must be
computed as provided in section 59(c) of the Internal Revenue Code.

(b) "Investment interest" means investment interest as defined in section 163(d)(3)
of the Internal Revenue Code.

(c) "Tentative minimum tax" equals 6.4 percent of alternative minimum taxable
income after subtracting the exemption amount determined under subdivision 3.

(d) "Regular tax" means the tax that would be imposed under this chapter (without
regard to this section and section 290.032), reduced by the sum of the nonrefundable
credits allowed under this chapter.

(e) "Net minimum tax" means the minimum tax imposed by this section.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after
December 31, 2007.
new text end

Sec. 7.

Minnesota Statutes 2006, section 290.0921, subdivision 3, is amended to read:

Subd. 3.

Alternative minimum taxable income.

"Alternative minimum taxable
income" is Minnesota net income as defined in section 290.01, subdivision 19, and
includes the adjustments and tax preference items in sections 56, 57, 58, and 59(d), (e),
(f), and (h) of the Internal Revenue Code. If a corporation files a separate company
Minnesota tax return, the minimum tax must be computed on a separate company basis.
If a corporation is part of a tax group filing a unitary return, the minimum tax must be
computed on a unitary basis. The following adjustments must be made.

(1) For purposes of the depreciation adjustments under section 56(a)(1) and
56(g)(4)(A) of the Internal Revenue Code, the basis for depreciable property placed in
service in a taxable year beginning before January 1, 1990, is the adjusted basis for federal
income tax purposes, including any modification made in a taxable year under section
290.01, subdivision 19e, or Minnesota Statutes 1986, section 290.09, subdivision 7,
paragraph (c).

For taxable years beginning after December 31, 2000, the amount of any remaining
modification made under section 290.01, subdivision 19e, or Minnesota Statutes 1986,
section 290.09, subdivision 7, paragraph (c), not previously deducted is a depreciation
allowance in the first taxable year after December 31, 2000.

(2) The portion of the depreciation deduction allowed for federal income tax
purposes under section 168(k) of the Internal Revenue Code that is required as an
addition under section 290.01, subdivision 19c, clause (16), is disallowed in determining
alternative minimum taxable income.

(3) The subtraction for depreciation allowed under section 290.01, subdivision 19d,
clause (19), is allowed as a depreciation deduction in determining alternative minimum
taxable income.

(4) The alternative tax net operating loss deduction under sections 56(a)(4) and 56(d)
of the Internal Revenue Code does not apply.

(5) The special rule for certain dividends under section 56(g)(4)(C)(ii) of the Internal
Revenue Code does not apply.

(6) The special rule for dividends from section 936 companies under section
56(g)(4)(C)(iii) does not apply.

(7) The tax preference for depletion under section 57(a)(1) of the Internal Revenue
Code does not apply.

(8) The tax preference for intangible drilling costs under section 57(a)(2) of the
Internal Revenue Code must be calculated without regard to subparagraph (E) and the
subtraction under section 290.01, subdivision 19d, clause (4).

(9) The tax preference for tax exempt interest under section 57(a)(5) of the Internal
Revenue Code does not apply.

(10) The tax preference for charitable contributions of appreciated property under
section 57(a)(6) of the Internal Revenue Code does not apply.

(11) For purposes of calculating the tax preference for accelerated depreciation or
amortization on certain property placed in service before January 1, 1987, under section
57(a)(7) of the Internal Revenue Code, the deduction allowable for the taxable year is the
deduction allowed under section 290.01, subdivision 19e.

For taxable years beginning after December 31, 2000, the amount of any remaining
modification made under section 290.01, subdivision 19e, not previously deducted is a
depreciation or amortization allowance in the first taxable year after December 31, 2004.

(12) For purposes of calculating the adjustment for adjusted current earnings in
section 56(g) of the Internal Revenue Code, the term "alternative minimum taxable
income" as it is used in section 56(g) of the Internal Revenue Code, means alternative
minimum taxable income as defined in this subdivision, determined without regard to the
adjustment for adjusted current earnings in section 56(g) of the Internal Revenue Code.

(13) For purposes of determining the amount of adjusted current earnings under
section 56(g)(3) of the Internal Revenue Code, no adjustment shall be made under section
56(g)(4) of the Internal Revenue Code with respect to (i) the amount of foreign dividend
gross-up subtracted as provided in section 290.01, subdivision 19d, clause (1), (ii) the
amount of refunds of income, excise, or franchise taxes subtracted as provided in section
290.01, subdivision 19d, clause (10), or (iii) the amount of royalties, fees or other like
income subtracted as provided in section 290.01, subdivision 19d, clause (11).

(14) Alternative minimum taxable income excludes the income from operating in a
job opportunity building zone as provided under section 469.317.

(15) Alternative minimum taxable income excludes the income from operating in a
biotechnology and health sciences industry zone as provided under section 469.337.

(16) Alternative minimum taxable income excludes the income from operating in an
international economic development zone as provided under section 469.326.

new text begin (17) Alternative minimum taxable income excludes the income from operating in a
tax-free renaissance zone as provided under section 469.343.
new text end

Items of tax preference must not be reduced below zero as a result of the
modifications in this subdivision.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after
December 31, 2007.
new text end

Sec. 8.

Minnesota Statutes 2006, section 290.0922, subdivision 2, is amended to read:

Subd. 2.

Exemptions.

The following entities are exempt from the tax imposed
by this section:

(1) corporations exempt from tax under section 290.05;

(2) real estate investment trusts;

(3) regulated investment companies or a fund thereof; and

(4) entities having a valid election in effect under section 860D(b) of the Internal
Revenue Code;

(5) town and farmers' mutual insurance companies;

(6) cooperatives organized under chapter 308A or 308B that provide housing
exclusively to persons age 55 and over and are classified as homesteads under section
273.124, subdivision 3;

(7) an entity, if for the taxable year all of its property is located in a job opportunity
building zone designated under section 469.314 and all of its payroll is a job opportunity
building zone payroll under section 469.310; deleted text begin and
deleted text end

(8) an entity, if for the taxable year all of its property is located in an international
economic development zone designated under section 469.322, and all of its payroll is
international economic development zone payroll under section 469.321. The exemption
under this clause applies to taxable years beginning during the duration of the international
economic development zone deleted text begin . deleted text end new text begin ; and
new text end

new text begin (9) an entity, if for the taxable year all of its property is located in a tax-free
renaissance zone designated under section 479.342 and all of its payroll and its zone
payroll as defined under section 469.343.
new text end

Entities not specifically exempted by this subdivision are subject to tax under this
section, notwithstanding section 290.05.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after
December 31, 2007.
new text end

Sec. 9.

new text begin [469.342] TAX-FREE RENAISSANCE ZONE; FERGUS FALLS.
new text end

new text begin Subdivision 1. new text end

new text begin Designation of zone. new text end

new text begin The area of the campus of the former state
regional treatment center in the city of Fergus Falls is designated a tax-free renaissance
zone. The zone includes the five buildings and associated land that were acquired by
the city prior to January 1, 2007.
new text end

new text begin Subd. 2. new text end

new text begin Duration limit. new text end

new text begin Designation of the zone is effective for 15 calendar years
beginning on the date specified, by resolution, by the governing body of the city of Fergus
Falls. The city may divide the area of the zone into subzones. If the city divides the
zone into separate subzones, the duration of each subzone begins on the date specified
by the resolution establishing the subzone. Each subzone has a duration of 15 calendar
years, unless the authorizing resolution specifies a shorter limit. No subzone duration may
begin later than January 1, 2013.
new text end

new text begin Subd. 3. new text end

new text begin Tax incentives available in the zone. new text end

new text begin Individuals that reside in the zone,
qualified businesses that operate in the zone, and property located in the zone qualify for
the following tax exemptions and incentives:
new text end

new text begin (1) an individual income tax credit under section 290.06, subdivision 35;
new text end

new text begin (2) exemption for business income from the individual income and corporate
franchise taxes as provided under section 469.343;
new text end

new text begin (3) exemption from the property tax as provided in section 272.02, subdivision
85; and
new text end

new text begin (4) the historic preservation tax credit under section 290.06, subdivision 34.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective upon compliance by the governing
body of the city of Fergus Falls with Minnesota Statutes, section 645.021.
new text end

Sec. 10.

new text begin [469.343] BUSINESS INCOME TAX EXEMPTION.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) For purposes of this section and section 469.342, the
following terms have the meanings given them.
new text end

new text begin (b) A "qualified business" is a person carrying on a trade or business at a place of
business located within the zone that has entered into a business subsidy agreement, as
defined in section 116J.994, with the city of Fergus Falls before the first day of the taxable
year or the taxes payable year for purposes of the property tax exemption.
new text end

new text begin (c) "Zone" is the tax-free renaissance zone designated under section 469.342.
new text end

new text begin (d) "Zone payroll" is that portion of the payroll factor under section 290.191 that
represents:
new text end

new text begin (1) wages or salaries paid to an individual for services performed in the zone; or
new text end

new text begin (2) wages or salaries paid to individuals working from offices within a zone if their
employment requires them to work outside the zone and the work is incidental to the work
performed by the individual within the zone.
new text end

new text begin (e) "Zone percentage" means the following fraction reduced to a percentage:
new text end

new text begin (1) the numerator of the fraction is: (i) the ratio of the taxpayer's property factor
under section 290.191 located in the zone for the taxable year over the property factor
numerator determined under section 290.191, plus (ii) the ratio of the taxpayer's zone
payroll factor over the payroll factor numerator determined under section 290.191; and
new text end

new text begin (2) the denominator of the fraction is two.
new text end

new text begin When calculating the zone percentage for a business that is part of a unitary business
as defined under section 290.17, subdivision 4, the denominator of the payroll and
property factors is the Minnesota payroll and property of the unitary business as reported
on the combined report under section 290.17, subdivision 4, paragraph (j).
new text end

new text begin Subd. 2. new text end

new text begin Tax exemption. new text end

new text begin (a) A qualified business is exempt from taxation under
sections 290.01, 290.02, the alternative minimum tax under section 290.0921, and
the minimum fee under section 290.0922, on the portion of its income attributable to
operations within the zone, designated under section 469.342.
new text end

new text begin (b) This exemption is determined as follows:
new text end

new text begin (1) for purposes of the individual income tax imposed under sections 290.01 and
290.091, the taxpayer may subtract an amount equal to the total income included in
federal taxable income attributable to operation of a trade or business, multiplied by
the zone percentage;
new text end

new text begin (2) for purposes of the tax imposed under section 290.02, by multiplying its taxable
net income by its zone percentage and subtracting the result in determining taxable income;
new text end

new text begin (3) for purposes of the alternative minimum tax under section 290.0921, by
multiplying its alternative minimum taxable income by its zone percentage and reducing
alternative minimum taxable income by this amount; and
new text end

new text begin (4) for purposes of the minimum fee under section 290.0922, by excluding property
and payroll in the zone from the computations of the fee or by exempting the entity under
section 290.0922, subdivision 2, clause (9).
new text end

new text begin Subd. 3. new text end

new text begin Application period. new text end

new text begin (a) This section applies only to taxable years
beginning during the duration of the tax-free renaissance zone or subzone.
new text end

new text begin (b) For the final three years of the duration of the zone or subzone, the deductions or
exemptions under this section must be multiplied by the following percentages:
new text end

new text begin (1) for taxable years beginning during the third to the last calendar year of the
duration, 75 percent;
new text end

new text begin (2) for taxable years beginning during the second to the last calendar year of the
duration, 50 percent; and
new text end

new text begin (3) for taxable years beginning the last calendar year of the duration limit, 25 percent.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after
December 31, 2007.
new text end