HF 1721

as introduced - 81st Legislature (1999 - 2000) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to property taxes; increasing the valuation 
  1.3             limit for the first tier of residential homestead 
  1.4             property; increasing the education homestead credit 
  1.5             rate; reducing the general education levy; amending 
  1.6             Minnesota Statutes 1998, sections 273.13, subdivision 
  1.7             22; 273.1382, subdivision 1; and 273.1398, subdivision 
  1.8             1a; repealing Minnesota Statutes 1998, section 
  1.9             273.1382, subdivision 1a. 
  1.10  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.11     Section 1.  Minnesota Statutes 1998, section 273.13, 
  1.12  subdivision 22, is amended to read: 
  1.13     Subd. 22.  [CLASS 1.] (a) Except as provided in subdivision 
  1.14  23, real estate which is residential and used for homestead 
  1.15  purposes is class 1.  The market value of class 1a property must 
  1.16  be determined based upon the value of the house, garage, and 
  1.17  land.  
  1.18     The first $75,000 $125,000 of market value of class 1a 
  1.19  property has a net class rate of one percent of its market 
  1.20  value; and the market value of class 1a property that 
  1.21  exceeds $75,000 $125,000 has a class rate of 1.7 percent of its 
  1.22  market value.  
  1.23     (b) Class 1b property includes homestead real estate or 
  1.24  homestead manufactured homes used for the purposes of a 
  1.25  homestead by 
  1.26     (1) any blind person, or the blind person and the blind 
  1.27  person's spouse; or 
  2.1      (2) any person, hereinafter referred to as "veteran," who: 
  2.2      (i) served in the active military or naval service of the 
  2.3   United States; and 
  2.4      (ii) is entitled to compensation under the laws and 
  2.5   regulations of the United States for permanent and total 
  2.6   service-connected disability due to the loss, or loss of use, by 
  2.7   reason of amputation, ankylosis, progressive muscular 
  2.8   dystrophies, or paralysis, of both lower extremities, such as to 
  2.9   preclude motion without the aid of braces, crutches, canes, or a 
  2.10  wheelchair; and 
  2.11     (iii) has acquired a special housing unit with special 
  2.12  fixtures or movable facilities made necessary by the nature of 
  2.13  the veteran's disability, or the surviving spouse of the 
  2.14  deceased veteran for as long as the surviving spouse retains the 
  2.15  special housing unit as a homestead; or 
  2.16     (3) any person who: 
  2.17     (i) is permanently and totally disabled and 
  2.18     (ii) receives 90 percent or more of total income from 
  2.19     (A) aid from any state as a result of that disability; or 
  2.20     (B) supplemental security income for the disabled; or 
  2.21     (C) workers' compensation based on a finding of total and 
  2.22  permanent disability; or 
  2.23     (D) social security disability, including the amount of a 
  2.24  disability insurance benefit which is converted to an old age 
  2.25  insurance benefit and any subsequent cost of living increases; 
  2.26  or 
  2.27     (E) aid under the federal Railroad Retirement Act of 1937, 
  2.28  United States Code Annotated, title 45, section 228b(a)5; or 
  2.29     (F) a pension from any local government retirement fund 
  2.30  located in the state of Minnesota as a result of that 
  2.31  disability; or 
  2.32     (G) pension, annuity, or other income paid as a result of 
  2.33  that disability from a private pension or disability plan, 
  2.34  including employer, employee, union, and insurance plans and 
  2.35     (iii) has household income as defined in section 290A.03, 
  2.36  subdivision 5, of $50,000 or less; or 
  3.1      (4) any person who is permanently and totally disabled and 
  3.2   whose household income as defined in section 290A.03, 
  3.3   subdivision 5, is 275 percent or less of the federal poverty 
  3.4   level. 
  3.5      Property is classified and assessed under clause (4) only 
  3.6   if the government agency or income-providing source certifies, 
  3.7   upon the request of the homestead occupant, that the homestead 
  3.8   occupant satisfies the disability requirements of this paragraph.
  3.9      Property is classified and assessed pursuant to clause (1) 
  3.10  only if the commissioner of economic security certifies to the 
  3.11  assessor that the homestead occupant satisfies the requirements 
  3.12  of this paragraph.  
  3.13     Permanently and totally disabled for the purpose of this 
  3.14  subdivision means a condition which is permanent in nature and 
  3.15  totally incapacitates the person from working at an occupation 
  3.16  which brings the person an income.  The first $32,000 market 
  3.17  value of class 1b property has a net class rate of .45 percent 
  3.18  of its market value.  The remaining market value of class 1b 
  3.19  property has a net class rate using the rates for class 1 or 
  3.20  class 2a property, whichever is appropriate, of similar market 
  3.21  value.  
  3.22     (c) Class 1c property is commercial use real property that 
  3.23  abuts a lakeshore line and is devoted to temporary and seasonal 
  3.24  residential occupancy for recreational purposes but not devoted 
  3.25  to commercial purposes for more than 250 days in the year 
  3.26  preceding the year of assessment, and that includes a portion 
  3.27  used as a homestead by the owner, which includes a dwelling 
  3.28  occupied as a homestead by a shareholder of a corporation that 
  3.29  owns the resort or a partner in a partnership that owns the 
  3.30  resort, even if the title to the homestead is held by the 
  3.31  corporation or partnership.  For purposes of this clause, 
  3.32  property is devoted to a commercial purpose on a specific day if 
  3.33  any portion of the property, excluding the portion used 
  3.34  exclusively as a homestead, is used for residential occupancy 
  3.35  and a fee is charged for residential occupancy.  Class 1c 
  3.36  property has a class rate of one percent of total market value 
  4.1   with the following limitation:  the area of the property must 
  4.2   not exceed 100 feet of lakeshore footage for each cabin or 
  4.3   campsite located on the property up to a total of 800 feet and 
  4.4   500 feet in depth, measured away from the lakeshore.  If any 
  4.5   portion of the class 1c resort property is classified as class 
  4.6   4c under subdivision 25, the entire property must meet the 
  4.7   requirements of subdivision 25, paragraph (d), clause (1), to 
  4.8   qualify for class 1c treatment under this paragraph. 
  4.9      (d) Class 1d property includes structures that meet all of 
  4.10  the following criteria: 
  4.11     (1) the structure is located on property that is classified 
  4.12  as agricultural property under section 273.13, subdivision 23; 
  4.13     (2) the structure is occupied exclusively by seasonal farm 
  4.14  workers during the time when they work on that farm, and the 
  4.15  occupants are not charged rent for the privilege of occupying 
  4.16  the property, provided that use of the structure for storage of 
  4.17  farm equipment and produce does not disqualify the property from 
  4.18  classification under this paragraph; 
  4.19     (3) the structure meets all applicable health and safety 
  4.20  requirements for the appropriate season; and 
  4.21     (4) the structure is not salable as residential property 
  4.22  because it does not comply with local ordinances relating to 
  4.23  location in relation to streets or roads. 
  4.24     The market value of class 1d property has the same class 
  4.25  rates as class 1a property under paragraph (a). 
  4.26     Sec. 2.  Minnesota Statutes 1998, section 273.1382, 
  4.27  subdivision 1, is amended to read: 
  4.28     Subdivision 1.  [EDUCATION HOMESTEAD CREDIT.] Each year, 
  4.29  the respective county auditors shall determine the initial tax 
  4.30  rate for each school district for the general education levy 
  4.31  certified under section 126C.13, subdivision 2 or 3.  That rate 
  4.32  plus the school district's education homestead credit tax rate 
  4.33  adjustment under section 275.08, subdivision 1e, shall be the 
  4.34  general education homestead credit local tax rate for the 
  4.35  district.  The auditor shall then determine a general education 
  4.36  homestead credit for each homestead within the county equal to 
  5.1   68 percent for taxes payable in 1999 and 69 73 percent for taxes 
  5.2   payable in 2000 and thereafter of the general education 
  5.3   homestead credit local tax rate times the net tax capacity of 
  5.4   the homestead for the taxes payable year.  The amount of general 
  5.5   education homestead credit for a homestead may not exceed $320 
  5.6   for taxes payable in 1999 and $335 for taxes payable in 2000 and 
  5.7   thereafter.  In the case of an agricultural homestead, only the 
  5.8   net tax capacity of the house, garage, and surrounding one acre 
  5.9   of land shall be used in determining the property's education 
  5.10  homestead credit. 
  5.11     Sec. 3.  Minnesota Statutes 1998, section 273.1398, 
  5.12  subdivision 1a, is amended to read: 
  5.13     Subd. 1a.  [TAX BASE DIFFERENTIAL.] (a) For aids payable in 
  5.14  2000, the tax base differential is (i) 0.7 percent of the 
  5.15  assessment year 1998 taxable market value of class 1a or 2a 
  5.16  residential homestead property between $75,000 in value and 
  5.17  $125,000 in value; in the case of class 2a property, only the 
  5.18  value of the house, garage, and surrounding acre of land is 
  5.19  included under clause (i), plus (ii) for purposes of computing 
  5.20  the fiscal disparity adjustment only, the tax base differential 
  5.21  is 0.2 percent of the assessment year 1998 taxable market value 
  5.22  of class 3 commercial-industrial property over $150,000. 
  5.23     (b) For the purposes of the distribution of homestead and 
  5.24  agricultural credit aid for aids payable in 2000, the 
  5.25  commissioner of revenue shall use the best information available 
  5.26  as of June 30, 1999, to make an estimate of the value described 
  5.27  in paragraph (a), clause (i).  The commissioner shall adjust the 
  5.28  distribution of homestead and agricultural credit aid for aids 
  5.29  payable in 2001 and subsequent years if new information 
  5.30  regarding the value described in paragraph (a), clause (i), 
  5.31  becomes available after June 30, 1999. 
  5.32     Sec. 4.  [GENERAL EDUCATION LEVY REDUCTION.] 
  5.33     In addition to any amount appropriated by other law, 
  5.34  $67,500,000 in fiscal year 2000 and $75,000,000 in fiscal year 
  5.35  2001 and subsequent years is appropriated from the general fund 
  5.36  to the commissioner of children, families, and learning to fund 
  6.1   a reduction in the statewide general education property tax levy 
  6.2   of $75,000,000 per year. 
  6.3      Sec. 5.  [REPEALER.] 
  6.4      Minnesota Statutes 1998, section 273.1382, subdivision 1a, 
  6.5   is repealed. 
  6.6      Sec. 6.  [EFFECTIVE DATE.] 
  6.7      This act is effective for taxes payable in 2000 and 
  6.8   subsequent years.