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HF 1775

as introduced - 87th Legislature (2011 - 2012) Posted on 01/24/2012 10:16am

KEY: stricken = removed, old language. underscored = added, new language.

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Current Version - as introduced

1.1A bill for an act
1.2relating to property taxation; restoring the market value homestead credit;
1.3amending Minnesota Statutes 2010, sections 126C.01, subdivision 3, as
1.4amended; 273.13, subdivision 34, as amended; 273.1384, subdivisions 3, as
1.5amended, 4, as amended; 273.1393, as amended; 276.04, subdivision 2, as
1.6amended; 477A.011, subdivision 20, as amended; repealing Laws 2011, First
1.7Special Session chapter 7, article 6, section 3.
1.8BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.9    Section 1. Minnesota Statutes 2010, section 126C.01, subdivision 3, as amended by
1.10Laws 2011, First Special Session chapter 7, article 6, section 2, is amended to read:
1.11    Subd. 3. Referendum market value. "Referendum market value" means the market
1.12value of all taxable property, excluding property classified as class 2, noncommercial
1.134c(1), or 4c(4) under section 273.13. The portion of class 2a property consisting of the
1.14house, garage, and surrounding one acre of land of an agricultural homestead is included
1.15in referendum market value. For the purposes of this subdivision, in the case of class 1a,
1.161b, or 2a property, "market value" means the value prior to the exclusion under section
1.17273.13, subdivision 35. Any class of property, or any portion of a class of property, that is
1.18included in the definition of referendum market value and that has a class rate of less than
1.19one percent under section 273.13 shall have a referendum market value equal to its market
1.20value times its class rate, multiplied by 100.
1.21EFFECTIVE DATE.This section is effective for taxes payable in 2013 and
1.22thereafter.

1.23    Sec. 2. Minnesota Statutes 2010, section 273.13, subdivision 34, as amended by Laws
1.242011, First Special Session chapter 7, article 5, section 8, is amended to read:
2.1    Subd. 34. Homestead of disabled veteran or family caregiver. (a) All or a
2.2portion of the market value of property owned by a veteran and serving as the veteran's
2.3homestead under this section is excluded in determining the property's taxable market
2.4value if the veteran has a service-connected disability of 70 percent or more as certified
2.5by the United States Department of Veterans Affairs. To qualify for exclusion under this
2.6subdivision, the veteran must have been honorably discharged from the United States
2.7armed forces, as indicated by United States Government Form DD214 or other official
2.8military discharge papers.
2.9    (b)(1) For a disability rating of 70 percent or more, $150,000 of market value is
2.10excluded, except as provided in clause (2); and
2.11    (2) for a total (100 percent) and permanent disability, $300,000 of market value is
2.12excluded.
2.13    (c) If a disabled veteran qualifying for a valuation exclusion under paragraph (b),
2.14clause (2), predeceases the veteran's spouse, and if upon the death of the veteran the
2.15spouse holds the legal or beneficial title to the homestead and permanently resides there,
2.16the exclusion shall carry over to the benefit of the veteran's spouse for the current taxes
2.17payable year and for five additional taxes payable years or until such time as the spouse
2.18remarries, or sells, transfers, or otherwise disposes of the property, whichever comes first.
2.19Qualification under this paragraph requires an annual application under paragraph (h).
2.20(d) If the spouse of a member of any branch or unit of the United States armed
2.21forces who dies due to a service-connected cause while serving honorably in active
2.22service, as indicated on United States Government Form DD1300 or DD2064, holds
2.23the legal or beneficial title to a homestead and permanently resides there, the spouse is
2.24entitled to the benefit described in paragraph (b), clause (2), for five taxes payable years,
2.25or until such time as the spouse remarries or sells, transfers, or otherwise disposes of the
2.26property, whichever comes first.
2.27(e) If a veteran meets the disability criteria of paragraph (a) but does not own
2.28property classified as homestead in the state of Minnesota, then the homestead of the
2.29veteran's primary family caregiver, if any, is eligible for the exclusion that the veteran
2.30would otherwise qualify for under paragraph (b).
2.31    (f) In the case of an agricultural homestead, only the portion of the property
2.32consisting of the house and garage and immediately surrounding one acre of land qualifies
2.33for the valuation exclusion under this subdivision.
2.34    (g) A property qualifying for a valuation exclusion under this subdivision is not
2.35eligible for the market value exclusion under subdivision 35 credit under section 273.1384,
2.36subdivision 1, or classification under subdivision 22, paragraph (b).
3.1    (h) To qualify for a valuation exclusion under this subdivision a property owner
3.2must apply to the assessor by July 1 of each assessment year, except that an annual
3.3reapplication is not required once a property has been accepted for a valuation exclusion
3.4under paragraph (a) and qualifies for the benefit described in paragraph (b), clause (2), and
3.5the property continues to qualify until there is a change in ownership. For an application
3.6received after July 1 of any calendar year, the exclusion shall become effective for the
3.7following assessment year.
3.8(i) A first-time application by a qualifying spouse for the market value exclusion
3.9under paragraph (d) must be made any time within two years of the death of the service
3.10member.
3.11(j) For purposes of this subdivision:
3.12(1) "active service" has the meaning given in section 190.05;
3.13(2) "own" means that the person's name is present as an owner on the property deed;
3.14(3) "primary family caregiver" means a person who is approved by the secretary of
3.15the United States Department of Veterans Affairs for assistance as the primary provider
3.16of personal care services for an eligible veteran under the Program of Comprehensive
3.17Assistance for Family Caregivers, codified as United States Code, title 38, section 1720G;
3.18and
3.19(4) "veteran" has the meaning given the term in section 197.447.
3.20(k) The purpose of this provision of law providing a level of homestead property tax
3.21relief for gravely disabled veterans, their primary family caregivers, and their surviving
3.22spouses is to help ease the burdens of war for those among our state's citizens who bear
3.23those burdens most heavily.
3.24EFFECTIVE DATE.This section is effective for taxes payable in 2013 and
3.25thereafter.

3.26    Sec. 3. Minnesota Statutes 2010, section 273.1384, subdivision 3, as amended by Laws
3.272011, First Special Session chapter 7, article 6, section 4, is amended to read:
3.28    Subd. 3. Credit reimbursements. The county auditor shall determine the tax
3.29reductions allowed under subdivision 2 this section within the county for each taxes
3.30payable year and shall certify that amount to the commissioner of revenue as a part of the
3.31abstracts of tax lists submitted by the county auditors under section 275.29. Any prior
3.32year adjustments shall also be certified on the abstracts of tax lists. The commissioner
3.33shall review the certifications for accuracy, and may make such changes as are deemed
3.34necessary, or return the certification to the county auditor for correction. The credit credits
4.1under this section must be used to proportionately reduce the net tax capacity-based
4.2property tax payable to each local taxing jurisdiction as provided in section 273.1393.
4.3EFFECTIVE DATE.This section is effective for taxes payable in 2013 and
4.4thereafter.

4.5    Sec. 4. Minnesota Statutes 2010, section 273.1384, subdivision 4, as amended by Laws
4.62011, First Special Session chapter 7, article 6, section 5, is amended to read:
4.7    Subd. 4. Payment. (a) The commissioner of revenue shall reimburse each local
4.8taxing jurisdiction, other than school districts, for the tax reductions granted under
4.9subdivision 2 this section in two equal installments on October 31 and December 26 of
4.10the taxes payable year for which the reductions are granted, including in each payment
4.11the prior year adjustments certified on the abstracts for that taxes payable year. The
4.12reimbursements related to tax increments shall be issued in one installment each year on
4.13December 26.
4.14(b) The commissioner of revenue shall certify the total of the tax reductions granted
4.15under subdivision 2 this section for each taxes payable year within each school district to
4.16the commissioner of the Department of Education and the commissioner of education shall
4.17pay the reimbursement amounts to each school district as provided in section 273.1392.
4.18EFFECTIVE DATE.This section is effective for taxes payable in 2013 and
4.19thereafter.

4.20    Sec. 5. Minnesota Statutes 2010, section 273.1393, as amended by Laws 2011, First
4.21Special Session chapter 7, article 6, section 6, is amended to read:
4.22273.1393 COMPUTATION OF NET PROPERTY TAXES.
4.23    Notwithstanding any other provisions to the contrary, "net" property taxes are
4.24determined by subtracting the credits in the order listed from the gross tax:
4.25    (1) disaster credit as provided in sections 273.1231 to 273.1235;
4.26    (2) powerline credit as provided in section 273.42;
4.27    (3) agricultural preserves credit as provided in section 473H.10;
4.28    (4) enterprise zone credit as provided in section 469.171;
4.29    (5) disparity reduction credit;
4.30    (6) conservation tax credit as provided in section 273.119;
4.31    (7) homestead and agricultural credit credits as provided in section 273.1384;
4.32    (8) taconite homestead credit as provided in section 273.135;
4.33    (9) supplemental homestead credit as provided in section 273.1391; and
5.1    (10) the bovine tuberculosis zone credit, as provided in section 273.113.
5.2    The combination of all property tax credits must not exceed the gross tax amount.
5.3EFFECTIVE DATE.This section is effective for taxes payable in 2013 and
5.4thereafter.

5.5    Sec. 6. Minnesota Statutes 2010, section 276.04, subdivision 2, as amended by Laws
5.62011, First Special Session chapter 7, article 6, section 7, is amended to read:
5.7    Subd. 2. Contents of tax statements. (a) The treasurer shall provide for the
5.8printing of the tax statements. The commissioner of revenue shall prescribe the form of
5.9the property tax statement and its contents. The tax statement must not state or imply
5.10that property tax credits are paid by the state of Minnesota. The statement must contain
5.11a tabulated statement of the dollar amount due to each taxing authority and the amount
5.12of the state tax from the parcel of real property for which a particular tax statement is
5.13prepared. The dollar amounts attributable to the county, the state tax, the voter approved
5.14school tax, the other local school tax, the township or municipality, and the total of
5.15the metropolitan special taxing districts as defined in section 275.065, subdivision 3,
5.16paragraph (i), must be separately stated. The amounts due all other special taxing districts,
5.17if any, may be aggregated except that any levies made by the regional rail authorities in the
5.18county of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter
5.19398A shall be listed on a separate line directly under the appropriate county's levy. If the
5.20county levy under this paragraph includes an amount for a lake improvement district as
5.21defined under sections 103B.501 to 103B.581, the amount attributable for that purpose
5.22must be separately stated from the remaining county levy amount. In the case of Ramsey
5.23County, if the county levy under this paragraph includes an amount for public library
5.24service under section 134.07, the amount attributable for that purpose may be separated
5.25from the remaining county levy amount. The amount of the tax on homesteads qualifying
5.26under the senior citizens' property tax deferral program under chapter 290B is the total
5.27amount of property tax before subtraction of the deferred property tax amount. The
5.28amount of the tax on contamination value imposed under sections 270.91 to 270.98, if any,
5.29must also be separately stated. The dollar amounts, including the dollar amount of any
5.30special assessments, may be rounded to the nearest even whole dollar. For purposes of this
5.31section whole odd-numbered dollars may be adjusted to the next higher even-numbered
5.32dollar. The amount of market value excluded under section 273.11, subdivision 16, if any,
5.33must also be listed on the tax statement.
6.1    (b) The property tax statements for manufactured homes and sectional structures
6.2taxed as personal property shall contain the same information that is required on the
6.3tax statements for real property.
6.4    (c) Real and personal property tax statements must contain the following information
6.5in the order given in this paragraph. The information must contain the current year tax
6.6information in the right column with the corresponding information for the previous year
6.7in a column on the left:
6.8    (1) the property's estimated market value under section 273.11, subdivision 1;
6.9(2) the property's homestead market value exclusion under section 273.13,
6.10subdivision 35
;
6.11    (3) the property's taxable market value after reductions under sections section
6.12273.11 , subdivisions 1a and 16, and 273.13, subdivision 35;
6.13    (4) (3) the property's gross tax, before credits;
6.14    (5) (4) for homestead residential and agricultural properties, the credit credits under
6.15section 273.1384;
6.16    (6) (5) any credits received under sections 273.119; 273.1234 or 273.1235; 273.135;
6.17273.1391 ; 273.1398, subdivision 4; 469.171; and 473H.10, except that the amount of
6.18credit received under section 273.135 must be separately stated and identified as "taconite
6.19tax relief"; and
6.20    (7) (6) the net tax payable in the manner required in paragraph (a).
6.21    (d) If the county uses envelopes for mailing property tax statements and if the county
6.22agrees, a taxing district may include a notice with the property tax statement notifying
6.23taxpayers when the taxing district will begin its budget deliberations for the current
6.24year, and encouraging taxpayers to attend the hearings. If the county allows notices to
6.25be included in the envelope containing the property tax statement, and if more than
6.26one taxing district relative to a given property decides to include a notice with the tax
6.27statement, the county treasurer or auditor must coordinate the process and may combine
6.28the information on a single announcement.
6.29EFFECTIVE DATE.This section is effective for taxes payable in 2013 and
6.30thereafter.

6.31    Sec. 7. Minnesota Statutes 2010, section 477A.011, subdivision 20, as amended by
6.32Laws 2011, First Special Session chapter 7, article 6, section 14, is amended to read:
6.33    Subd. 20. City net tax capacity. "City net tax capacity" means (1) the net tax
6.34capacity computed using the net tax capacity rates in section 273.13 for taxes payable
6.35in the year of the aid distribution, and the market values, after the exclusion in section
7.1273.13, subdivision 35, for taxes payable in the year prior to the aid distribution plus (2)
7.2a city's fiscal disparities distribution tax capacity under section 276A.06, subdivision 2,
7.3paragraph (b), or 473F.08, subdivision 2, paragraph (b), for taxes payable in the year prior
7.4to that for which aids are being calculated. The market value utilized in computing city
7.5net tax capacity shall be reduced by the sum of (1) a city's market value of commercial
7.6industrial property as defined in section 276A.01, subdivision 3, or 473F.02, subdivision 3,
7.7multiplied by the ratio determined pursuant to section 276A.06, subdivision 2, paragraph
7.8(a), or 473F.08, subdivision 2, paragraph (a), (2) the market value of the captured value
7.9of tax increment financing districts as defined in section 469.177, subdivision 2, and (3)
7.10the market value of transmission lines deducted from a city's total net tax capacity under
7.11section 273.425. The city net tax capacity will be computed using equalized market values.
7.12EFFECTIVE DATE.This section is effective for aids payable in calendar year
7.132013 and thereafter.

7.14    Sec. 8. REPEALER.
7.15Laws 2011, First Special Session chapter 7, article 6, section 3, is repealed, and
7.16pursuant to Minnesota Statutes, section 645.36, Minnesota Statutes 2010, section
7.17273.1384, subdivision 1, is revived.
7.18EFFECTIVE DATE.This section is effective for taxes payable in 2013 and
7.19thereafter.

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