as introduced - 80th Legislature (1997 - 1998) Posted on 12/15/2009 12:00am
Engrossments | ||
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Introduction | Posted on 03/20/1997 |
1.1 A bill for an act 1.2 relating to taxation; providing for property tax 1.3 reform; changing class rates; providing education 1.4 funding; providing truth in budgeting; providing levy 1.5 constraints; appropriating money; amending Minnesota 1.6 Statutes 1996, sections 273.13, subdivisions 22, 23, 1.7 24, 25, and 31; 273.1393; 275.065, subdivisions 1, 3, 1.8 5a, 6, 8, and by adding subdivisions; 275.07, 1.9 subdivision 1, and by adding a subdivision; 276.04, 1.10 subdivision 2; 477A.013, subdivision 9; and 477A.03, 1.11 subdivision 2; proposing coding for new law in 1.12 Minnesota Statutes, chapters 273; and 275; repealing 1.13 Minnesota Statutes 1996, sections 273.13, subdivision 1.14 32; 473.3915; and 477A.011, subdivision 37. 1.15 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 1.16 ARTICLE 1 1.17 PROPERTY TAX CLASSIFICATION 1.18 Section 1. Minnesota Statutes 1996, section 273.13, 1.19 subdivision 22, is amended to read: 1.20 Subd. 22. [CLASS 1.] (a) Except as provided in subdivision 1.21 23, real estate which is residential and used for homestead 1.22 purposes is class 1. The market value of class 1a property must 1.23 be determined based upon the value of the house, garage, and 1.24 land. 1.25 The first $72,000 of market value of class 1a property has 1.26 a net class rate of one percent of its market value and a gross 1.27 class rate of 2.17 percent of its market value.For taxes1.28payable in 1992, the market value of class 1a property that1.29exceeds $72,000 but does not exceed $115,000 has a class rate of1.30two percent of its market value; and the market value of class2.11a property that exceeds $115,000 has a class rate of 2.52.2percent of its market value. For taxes payable in 1993 and2.3thereafter,The market value of class 1a property that exceeds 2.4 $72,000 has a class rate oftwo1.65 percent. 2.5 (b) Class 1b property includes homestead real estate or 2.6 homestead manufactured homes used for the purposes of a 2.7 homestead by 2.8 (1) any blind person, or the blind person and the blind 2.9 person's spouse; or 2.10 (2) any person, hereinafter referred to as "veteran," who: 2.11 (i) served in the active military or naval service of the 2.12 United States; and 2.13 (ii) is entitled to compensation under the laws and 2.14 regulations of the United States for permanent and total 2.15 service-connected disability due to the loss, or loss of use, by 2.16 reason of amputation, ankylosis, progressive muscular 2.17 dystrophies, or paralysis, of both lower extremities, such as to 2.18 preclude motion without the aid of braces, crutches, canes, or a 2.19 wheelchair; and 2.20 (iii) has acquired a special housing unit with special 2.21 fixtures or movable facilities made necessary by the nature of 2.22 the veteran's disability, or the surviving spouse of the 2.23 deceased veteran for as long as the surviving spouse retains the 2.24 special housing unit as a homestead; or 2.25 (3) any person who: 2.26 (i) is permanently and totally disabled and 2.27 (ii) receives 90 percent or more of total income from 2.28 (A) aid from any state as a result of that disability; or 2.29 (B) supplemental security income for the disabled; or 2.30 (C) workers' compensation based on a finding of total and 2.31 permanent disability; or 2.32 (D) social security disability, including the amount of a 2.33 disability insurance benefit which is converted to an old age 2.34 insurance benefit and any subsequent cost of living increases; 2.35 or 2.36 (E) aid under the federal Railroad Retirement Act of 1937, 3.1 United States Code Annotated, title 45, section 228b(a)5; or 3.2 (F) a pension from any local government retirement fund 3.3 located in the state of Minnesota as a result of that 3.4 disability; or 3.5 (G) pension, annuity, or other income paid as a result of 3.6 that disability from a private pension or disability plan, 3.7 including employer, employee, union, and insurance plans and 3.8 (iii) has household income as defined in section 290A.03, 3.9 subdivision 5, of $50,000 or less; or 3.10 (4) any person who is permanently and totally disabled and 3.11 whose household income as defined in section 290A.03, 3.12 subdivision 5, is 150 percent or less of the federal poverty 3.13 level. 3.14 Property is classified and assessed under clause (4) only 3.15 if the government agency or income-providing source certifies, 3.16 upon the request of the homestead occupant, that the homestead 3.17 occupant satisfies the disability requirements of this paragraph. 3.18 Property is classified and assessed pursuant to clause (1) 3.19 only if the commissioner of economic security certifies to the 3.20 assessor that the homestead occupant satisfies the requirements 3.21 of this paragraph. 3.22 Permanently and totally disabled for the purpose of this 3.23 subdivision means a condition which is permanent in nature and 3.24 totally incapacitates the person from working at an occupation 3.25 which brings the person an income. The first $32,000 market 3.26 value of class 1b property has a net class rate of .45 percent 3.27 of its market value and a gross class rate of .87 percent of its 3.28 market value. The remaining market value of class 1b property 3.29 has a gross or net class rate using the rates for class 1 or 3.30 class 2a property, whichever is appropriate, of similar market 3.31 value. 3.32 (c) Class 1c property is commercial use real property that 3.33 abuts a lakeshore line and is devoted to temporary and seasonal 3.34 residential occupancy for recreational purposes but not devoted 3.35 to commercial purposes for more than 250 days in the year 3.36 preceding the year of assessment, and that includes a portion 4.1 used as a homestead by the owner, which includes a dwelling 4.2 occupied as a homestead by a shareholder of a corporation that 4.3 owns the resort or a partner in a partnership that owns the 4.4 resort, even if the title to the homestead is held by the 4.5 corporation or partnership. For purposes of this clause, 4.6 property is devoted to a commercial purpose on a specific day if 4.7 any portion of the property, excluding the portion used 4.8 exclusively as a homestead, is used for residential occupancy 4.9 and a fee is charged for residential occupancy. Class 1c 4.10 property has a class rate ofone.85 percent of total market 4.11 valuefor taxes payable in 1993 and thereafterwith the 4.12 following limitation: the area of the property must not exceed 4.13 100 feet of lakeshore footage for each cabin or campsite located 4.14 on the property up to a total of 800 feet and 500 feet in depth, 4.15 measured away from the lakeshore. 4.16 Sec. 2. Minnesota Statutes 1996, section 273.13, 4.17 subdivision 23, is amended to read: 4.18 Subd. 23. [CLASS 2.] (a) Class 2a property is agricultural 4.19 land including any improvements that is homesteaded. The market 4.20 value of the house and garage and immediately surrounding one 4.21 acre of land has the same class rates as class 1a property under 4.22 subdivision 22. The value of the remaining land including 4.23 improvements up to $115,000 has a net class rate of.45.35 4.24 percent of market value and a gross class rate of 1.75 percent 4.25 of market value. The remaining value of class 2a property over 4.26 $115,000 of market value that does not exceed 320 acres has a 4.27 net class rate ofone.85 percent of market value, and a gross 4.28 class rate of 2.25 percent of market value. The remaining 4.29 property over the $115,000 market value in excess of 320 acres 4.30 has a class rate of1.51.25 percent of market value, and a 4.31 gross class rate of 2.25 percent of market value. 4.32 (b) Class 2b property is (1) real estate, rural in 4.33 character and used exclusively for growing trees for timber, 4.34 lumber, and wood and wood products; (2) real estate that is not 4.35 improved with a structure and is used exclusively for growing 4.36 trees for timber, lumber, and wood and wood products, if the 5.1 owner has participated or is participating in a cost-sharing 5.2 program for afforestation, reforestation, or timber stand 5.3 improvement on that particular property, administered or 5.4 coordinated by the commissioner of natural resources; (3) real 5.5 estate that is nonhomestead agricultural land; or (4) a landing 5.6 area or public access area of a privately owned public use 5.7 airport. Class 2b property has a net class rate of1.51.25 5.8 percent of market value, and a gross class rate of 2.25 percent 5.9 of market value. 5.10 (c) Agricultural land as used in this section means 5.11 contiguous acreage of ten acres or more, primarily used during 5.12 the preceding year for agricultural purposes. Agricultural use 5.13 may include pasture, timber, waste, unusable wild land, and land 5.14 included in state or federal farm or conservation programs. 5.15 "Agricultural purposes" as used in this section means the 5.16 raising or cultivation of agricultural products. Land enrolled 5.17 in the Reinvest in Minnesota program under sections 103F.505 to 5.18 103F.531 or the federal Conservation Reserve Program as 5.19 contained in Public Law Number 99-198, and consisting of a 5.20 minimum of ten contiguous acres, shall be classified as 5.21 agricultural. Agricultural classification for property shall be 5.22 determined with respect to the use of the whole parcel, and not 5.23 based upon the market value of any residential structures on the 5.24 parcel or contiguous parcels under the same ownership. 5.25 (d) Real estate of less than ten acres used principally for 5.26 raising or cultivating agricultural products, shall be 5.27 considered as agricultural land, if it is not used primarily for 5.28 residential purposes. 5.29 (e) The term "agricultural products" as used in this 5.30 subdivision includes: 5.31 (1) livestock, dairy animals, dairy products, poultry and 5.32 poultry products, fur-bearing animals, horticultural and nursery 5.33 stock described in sections 18.44 to 18.61, fruit of all kinds, 5.34 vegetables, forage, grains, bees, and apiary products by the 5.35 owner; 5.36 (2) fish bred for sale and consumption if the fish breeding 6.1 occurs on land zoned for agricultural use; 6.2 (3) the commercial boarding of horses if the boarding is 6.3 done in conjunction with raising or cultivating agricultural 6.4 products as defined in clause (1); 6.5 (4) property which is owned and operated by nonprofit 6.6 organizations used for equestrian activities, excluding racing; 6.7 and 6.8 (5) game birds and waterfowl bred and raised for use on a 6.9 shooting preserve licensed under section 97A.115. 6.10 (f) If a parcel used for agricultural purposes is also used 6.11 for commercial or industrial purposes, including but not limited 6.12 to: 6.13 (1) wholesale and retail sales; 6.14 (2) processing of raw agricultural products or other goods; 6.15 (3) warehousing or storage of processed goods; and 6.16 (4) office facilities for the support of the activities 6.17 enumerated in clauses (1), (2), and (3), 6.18 the assessor shall classify the part of the parcel used for 6.19 agricultural purposes as class 1b, 2a, or 2b, whichever is 6.20 appropriate, and the remainder in the class appropriate to its 6.21 use. The grading, sorting, and packaging of raw agricultural 6.22 products for first sale is considered an agricultural purpose. 6.23 A greenhouse or other building where horticultural or nursery 6.24 products are grown that is also used for the conduct of retail 6.25 sales must be classified as agricultural if it is primarily used 6.26 for the growing of horticultural or nursery products from seed, 6.27 cuttings, or roots and occasionally as a showroom for the retail 6.28 sale of those products. Use of a greenhouse or building only 6.29 for the display of already grown horticultural or nursery 6.30 products does not qualify as an agricultural purpose. 6.31 The assessor shall determine and list separately on the 6.32 records the market value of the homestead dwelling and the one 6.33 acre of land on which that dwelling is located. If any farm 6.34 buildings or structures are located on this homesteaded acre of 6.35 land, their market value shall not be included in this separate 6.36 determination. 7.1 (g) To qualify for classification under paragraph (b), 7.2 clause (4), a privately owned public use airport must be 7.3 licensed as a public airport under section 360.018. For 7.4 purposes of paragraph (b), clause (4), "landing area" means that 7.5 part of a privately owned public use airport properly cleared, 7.6 regularly maintained, and made available to the public for use 7.7 by aircraft and includes runways, taxiways, aprons, and sites 7.8 upon which are situated landing or navigational aids. A landing 7.9 area also includes land underlying both the primary surface and 7.10 the approach surfaces that comply with all of the following: 7.11 (i) the land is properly cleared and regularly maintained 7.12 for the primary purposes of the landing, taking off, and taxiing 7.13 of aircraft; but that portion of the land that contains 7.14 facilities for servicing, repair, or maintenance of aircraft is 7.15 not included as a landing area; 7.16 (ii) the land is part of the airport property; and 7.17 (iii) the land is not used for commercial or residential 7.18 purposes. 7.19 The land contained in a landing area under paragraph (b), clause 7.20 (4), must be described and certified by the commissioner of 7.21 transportation. The certification is effective until it is 7.22 modified, or until the airport or landing area no longer meets 7.23 the requirements of paragraph (b), clause (4). For purposes of 7.24 paragraph (b), clause (4), "public access area" means property 7.25 used as an aircraft parking ramp, apron, or storage hangar, or 7.26 an arrival and departure building in connection with the airport. 7.27 (h) For the purposes of section 276.04, subdivision 2, 7.28 paragraph (c), the commissioner of revenue is to proportionately 7.29 reduce gross class rates for taxes payable in 1998 and 7.30 thereafter. 7.31 Sec. 3. Minnesota Statutes 1996, section 273.13, 7.32 subdivision 24, is amended to read: 7.33 Subd. 24. [CLASS 3.](a)Commercial and industrial 7.34 property and utility real and personal property, except class 5 7.35 property as identified in subdivision 31, clause (1), is class 7.36 3a. It has a class rate ofthree2.45 percent of the first 8.1 $100,000 of market valuefor taxes payable in 1993 and8.2thereafter, and5.06a class rate of 3.35 percent of the market 8.3 value over $100,000. In the case of state-assessed commercial, 8.4 industrial, and utility property owned by one person or entity, 8.5 only one parcel has a reduced class rate on the first $100,000 8.6 of market value. In the case of other commercial, industrial, 8.7 and utility property owned by one person or entity, only one 8.8 parcel in each county has a reduced class rate on the first 8.9 $100,000 of market value, except that: 8.10 (1) if the market value of the parcel is less than 8.11 $100,000, and additional parcels are owned by the same person or 8.12 entity in the same city or town within that county, the reduced 8.13 class rate shall be applied up to a combined total market value 8.14 of $100,000 for all parcels owned by the same person or entity 8.15 in the same city or town within the county; 8.16 (2) in the case of grain, fertilizer, and feed elevator 8.17 facilities, as defined in section 18C.305, subdivision 1, or 8.18 232.21, subdivision 8, the limitation to one parcel per owner 8.19 per county for the reduced class rate shall not apply, but there 8.20 shall be a limit of $100,000 of preferential value per site of 8.21 contiguous parcels owned by the same person or entity. Only the 8.22 value of the elevator portion of each parcel shall qualify for 8.23 treatment under this clause. For purposes of this subdivision, 8.24 contiguous parcels include parcels separated only by a railroad 8.25 or public road right-of-way; and 8.26 (3) in the case of property owned by a nonprofit charitable 8.27 organization that qualifies for tax exemption under section 8.28 501(c)(3) of the Internal Revenue Code of 1986, as amended 8.29 through December 31, 1993, if the property is used as a business 8.30 incubator, the limitation to one parcel per owner per county for 8.31 the reduced class rate shall not apply, provided that the 8.32 reduced rate applies only to the first $100,000 of value per 8.33 parcel owned by the organization. As used in this clause, a 8.34 "business incubator" is a facility used for the development of 8.35 nonretail businesses, offering access to equipment, space, 8.36 services, and advice to the tenant businesses, for the purpose 9.1 of encouraging economic development, diversification, and job 9.2 creation in the area served by the organization. 9.3 To receive the reduced class rate on additional parcels 9.4 under clause (1), (2), or (3), the taxpayer must notify the 9.5 county assessor that the taxpayer owns more than one parcel that 9.6 qualifies under clause (1), (2), or (3). 9.7(b) Employment property defined in section 469.166, during9.8the period provided in section 469.170, shall constitute class9.93b and has a class rate of 2.3 percent of the first $50,000 of9.10market value and 3.6 percent of the remainder, except that for9.11employment property located in a border city enterprise zone9.12designated pursuant to section 469.168, subdivision 4, paragraph9.13(c), the class rate of the first $100,000 of market value and9.14the class rate of the remainder is determined under paragraph9.15(a), unless the governing body of the city designated as an9.16enterprise zone determines that a specific parcel shall be9.17assessed pursuant to the first clause of this sentence. The9.18governing body may provide for assessment under the first clause9.19of the preceding sentence only for property which is located in9.20an area which has been designated by the governing body for the9.21receipt of tax reductions authorized by section 469.171,9.22subdivision 1.9.23(c) Structures which are (i) located on property classified9.24as class 3a, (ii) constructed under an initial building permit9.25issued after January 2, 1996, (iii) located in a transit zone as9.26defined under section 473.3915, subdivision 3, (iv) located9.27within the boundaries of a school district, and (v) not9.28primarily used for retail or transient lodging purposes, shall9.29have a class rate of four percent on that portion of the market9.30value in excess of $100,000 and any market value under $100,0009.31that does not qualify for the three percent class rate under9.32paragraph (a). As used in item (v), a structure is primarily9.33used for retail or transient lodging purposes if over 50 percent9.34of its square footage is used for those purposes. The four9.35percent rate shall also apply to improvements to existing9.36structures that meet the requirements of items (i) to (v) if the10.1improvements are constructed under an initial building permit10.2issued after January 2, 1996, even if the remainder of the10.3structure was constructed prior to January 2, 1996. For the10.4purposes of this paragraph, a structure shall be considered to10.5be located in a transit zone if any portion of the structure10.6lies within the zone. If any property once eligible for10.7treatment under this paragraph ceases to remain eligible due to10.8revisions in transit zone boundaries, the property shall10.9continue to receive treatment under this paragraph for a period10.10of three years.10.11 Sec. 4. Minnesota Statutes 1996, section 273.13, 10.12 subdivision 25, is amended to read: 10.13 Subd. 25. [CLASS 4.] (a) Class 4a is residential real 10.14 estate containing four or more units and used or held for use by 10.15 the owner or by the tenants or lessees of the owner as a 10.16 residence for rental periods of 30 days or more. Class 4a also 10.17 includes hospitals licensed under sections 144.50 to 144.56, 10.18 other than hospitals exempt under section 272.02, and contiguous 10.19 property used for hospital purposes, without regard to whether 10.20 the property has been platted or subdivided.Class 4a property10.21in a city with a population of 5,000 or less, that is (1)10.22located outside of the metropolitan area, as defined in section10.23473.121, subdivision 2, or outside any county contiguous to the10.24metropolitan area, and (2) whose city boundary is at least 1510.25miles from the boundary of any city with a population greater10.26than 5,000 has a class rate of 2.3 percent of market value for10.27taxes payable in 1996 and thereafter. All otherClass 4a 10.28 property has a class rate of3.42.65 percent of market value 10.29for taxes payable in 1996 and thereafter. For purposes of this10.30paragraph, population has the same meaning given in section10.31477A.011, subdivision 3. 10.32 (b) Class 4b includes: 10.33 (1) residential real estate containing less than four 10.34 units, other than seasonal residential, and recreational; 10.35 (2) manufactured homes not classified under any other 10.36 provision; 11.1 (3) a dwelling, garage, and surrounding one acre of 11.2 property on a nonhomestead farm classified under subdivision 23, 11.3 paragraph (b). 11.4 Class 4b property has a class rate of2.8 percent of market11.5value for taxes payable in 1992, 2.5 percent of market value for11.6taxes payable in 1993, and 2.31.85 percent of market valuefor11.7taxes payable in 1994 and thereafter. 11.8 (c) Class 4c property includes: 11.9 (1) a structure that is: 11.10 (i) situated on real property that is used for housing for 11.11 the elderly or for low- and moderate-income families as defined 11.12 in Title II, as amended through December 31, 1990, of the 11.13 National Housing Act or the Minnesota housing finance agency law 11.14 of 1971, as amended, or rules promulgated by the agency and 11.15 financed by a direct federal loan or federally insured loan made 11.16 pursuant to Title II of the Act; or 11.17 (ii) situated on real property that is used for housing the 11.18 elderly or for low- and moderate-income families as defined by 11.19 the Minnesota housing finance agency law of 1971, as amended, or 11.20 rules adopted by the agency pursuant thereto and financed by a 11.21 loan made by the Minnesota housing finance agency pursuant to 11.22 the provisions of the act. 11.23 This clause applies only to property of a nonprofit or 11.24 limited dividend entity. Property is classified as class 4c 11.25 under this clause for 15 years from the date of the completion 11.26 of the original construction or substantial rehabilitation, or 11.27 for the original term of the loan. 11.28 (2) a structure that is: 11.29 (i) situated upon real property that is used for housing 11.30 lower income families or elderly or handicapped persons, as 11.31 defined in section 8 of the United States Housing Act of 1937, 11.32 as amended; and 11.33 (ii) owned by an entity which has entered into a housing 11.34 assistance payments contract under section 8 which provides 11.35 assistance for 100 percent of the dwelling units in the 11.36 structure, other than dwelling units intended for management or 12.1 maintenance personnel. Property is classified as class 4c under 12.2 this clause for the term of the housing assistance payments 12.3 contract, including all renewals, or for the term of its 12.4 permanent financing, whichever is shorter; and 12.5 (3) a qualified low-income building as defined in section 12.6 42(c)(2) of the Internal Revenue Code of 1986, as amended 12.7 through December 31, 1990, that (i) receives a low-income 12.8 housing credit under section 42 of the Internal Revenue Code of 12.9 1986, as amended through December 31, 1990; or (ii) meets the 12.10 requirements of that section and receives public financing, 12.11 except financing provided under sections 469.174 to 469.179, 12.12 which contains terms restricting the rents; or (iii) meets the 12.13 requirements of section 273.1317. Classification pursuant to 12.14 this clause is limited to a term of 15 years. The public 12.15 financing received must be from at least one of the following 12.16 sources: government issued bonds exempt from taxes under 12.17 section 103 of the Internal Revenue Code of 1986, as amended 12.18 through December 31, 1993, the proceeds of which are used for 12.19 the acquisition or rehabilitation of the building; programs 12.20 under section 221(d)(3), 202, or 236, of Title II of the 12.21 National Housing Act; rental housing program funds under Section 12.22 8 of the United States Housing Act of 1937 or the market rate 12.23 family graduated payment mortgage program funds administered by 12.24 the Minnesota housing finance agency that are used for the 12.25 acquisition or rehabilitation of the building; public financing 12.26 provided by a local government used for the acquisition or 12.27 rehabilitation of the building, including grants or loans from 12.28 federal community development block grants, HOME block grants, 12.29 or residential rental bonds issued under chapter 474A; or other 12.30 rental housing program funds provided by the Minnesota housing 12.31 finance agency for the acquisition or rehabilitation of the 12.32 building. 12.33 For all properties described in clauses (1), (2), and (3) 12.34 and in paragraph (d), the market value determined by the 12.35 assessor must be based on the normal approach to value using 12.36 normal unrestricted rents unless the owner of the property 13.1 elects to have the property assessed under Laws 1991, chapter 13.2 291, article 1, section 55. If the owner of the property elects 13.3 to have the market value determined on the basis of the actual 13.4 restricted rents, as provided in Laws 1991, chapter 291, article 13.5 1, section 55, the property will be assessed at the rate 13.6 provided for class 4a or class 4b property, as appropriate. 13.7 Properties described in clauses (1)(ii), (3), and (4) may apply 13.8 to the assessor for valuation under Laws 1991, chapter 291, 13.9 article 1, section 55. The land on which these structures are 13.10 situated has the class rate given in paragraph (b) if the 13.11 structure contains fewer than four units, and the class rate 13.12 given in paragraph (a) if the structure contains four or more 13.13 units. This clause applies only to the property of a nonprofit 13.14 or limited dividend entity. 13.15 (4) a parcel of land, not to exceed one acre, and its 13.16 improvements or a parcel of unimproved land, not to exceed one 13.17 acre, if it is owned by a neighborhood real estate trust and at 13.18 least 60 percent of the dwelling units, if any, on all land 13.19 owned by the trust are leased to or occupied by lower income 13.20 families or individuals. This clause does not apply to any 13.21 portion of the land or improvements used for nonresidential 13.22 purposes. For purposes of this clause, a lower income family is 13.23 a family with an income that does not exceed 65 percent of the 13.24 median family income for the area, and a lower income individual 13.25 is an individual whose income does not exceed 65 percent of the 13.26 median individual income for the area, as determined by the 13.27 United States Secretary of Housing and Urban Development. For 13.28 purposes of this clause, "neighborhood real estate trust" means 13.29 an entity which is certified by the governing body of the 13.30 municipality in which it is located to have the following 13.31 characteristics: 13.32 (a) it is a nonprofit corporation organized under chapter 13.33 317A; 13.34 (b) it has as its principal purpose providing housing for 13.35 lower income families in a specific geographic community 13.36 designated in its articles or bylaws; 14.1 (c) it limits membership with voting rights to residents of 14.2 the designated community; and 14.3 (d) it has a board of directors consisting of at least 14.4 seven directors, 60 percent of whom are members with voting 14.5 rights and, to the extent feasible, 25 percent of whom are 14.6 elected by resident members of buildings owned by the trust; and 14.7 (5) except as provided in subdivision 22, paragraph (c), 14.8 real property devoted to temporary and seasonal residential 14.9 occupancy for recreation purposes, including real property 14.10 devoted to temporary and seasonal residential occupancy for 14.11 recreation purposes and not devoted to commercial purposes for 14.12 more than 250 days in the year preceding the year of 14.13 assessment. For purposes of this clause, property is devoted to 14.14 a commercial purpose on a specific day if any portion of the 14.15 property is used for residential occupancy, and a fee is charged 14.16 for residential occupancy. Class 4c also includes commercial 14.17 use real property used exclusively for recreational purposes in 14.18 conjunction with class 4c property devoted to temporary and 14.19 seasonal residential occupancy for recreational purposes, up to 14.20 a total of two acres, provided the property is not devoted to 14.21 commercial recreational use for more than 250 days in the year 14.22 preceding the year of assessment and is located within two miles 14.23 of the class 4c property with which it is used. Class 4c 14.24 property classified in this clause also includes the remainder 14.25 of class 1c resorts. Owners of real property devoted to 14.26 temporary and seasonal residential occupancy for recreation 14.27 purposes and all or a portion of which was devoted to commercial 14.28 purposes for not more than 250 days in the year preceding the 14.29 year of assessment desiring classification as class 1c or 4c, 14.30 must submit a declaration to the assessor designating the cabins 14.31 or units occupied for 250 days or less in the year preceding the 14.32 year of assessment by January 15 of the assessment year. Those 14.33 cabins or units and a proportionate share of the land on which 14.34 they are located will be designated class 1c or 4c as otherwise 14.35 provided. The remainder of the cabins or units and a 14.36 proportionate share of the land on which they are located will 15.1 be designated as class 3a. The first $100,000 of the market 15.2 value of the remainder of the cabins or units and a 15.3 proportionate share of the land on which they are located shall 15.4 have a class rate ofthree2.45 percent. The owner of property 15.5 desiring designation as class 1c or 4c property must provide 15.6 guest registers or other records demonstrating that the units 15.7 for which class 1c or 4c designation is sought were not occupied 15.8 for more than 250 days in the year preceding the assessment if 15.9 so requested. The portion of a property operated as a (1) 15.10 restaurant, (2) bar, (3) gift shop, and (4) other nonresidential 15.11 facility operated on a commercial basis not directly related to 15.12 temporary and seasonal residential occupancy for recreation 15.13 purposes shall not qualify for class 1c or 4c; 15.14 (6) real property up to a maximum of one acre of land owned 15.15 by a nonprofit community service oriented organization; provided 15.16 that the property is not used for a revenue-producing activity 15.17 for more than six days in the calendar year preceding the year 15.18 of assessment and the property is not used for residential 15.19 purposes on either a temporary or permanent basis. For purposes 15.20 of this clause, a "nonprofit community service oriented 15.21 organization" means any corporation, society, association, 15.22 foundation, or institution organized and operated exclusively 15.23 for charitable, religious, fraternal, civic, or educational 15.24 purposes, and which is exempt from federal income taxation 15.25 pursuant to section 501(c)(3), (10), or (19) of the Internal 15.26 Revenue Code of 1986, as amended through December 31, 1990. For 15.27 purposes of this clause, "revenue-producing activities" shall 15.28 include but not be limited to property or that portion of the 15.29 property that is used as an on-sale intoxicating liquor or 3.2 15.30 percent malt liquor establishment licensed under chapter 340A, a 15.31 restaurant open to the public, bowling alley, a retail store, 15.32 gambling conducted by organizations licensed under chapter 349, 15.33 an insurance business, or office or other space leased or rented 15.34 to a lessee who conducts a for-profit enterprise on the 15.35 premises. Any portion of the property which is used for 15.36 revenue-producing activities for more than six days in the 16.1 calendar year preceding the year of assessment shall be assessed 16.2 as class 3a. The use of the property for social events open 16.3 exclusively to members and their guests for periods of less than 16.4 24 hours, when an admission is not charged nor any revenues are 16.5 received by the organization shall not be considered a 16.6 revenue-producing activity; 16.7 (7) post-secondary student housing of not more than one 16.8 acre of land that is owned by a nonprofit corporation organized 16.9 under chapter 317A and is used exclusively by a student 16.10 cooperative, sorority, or fraternity for on-campus housing or 16.11 housing located within two miles of the border of a college 16.12 campus; and 16.13 (8) manufactured home parks as defined in section 327.14, 16.14 subdivision 3. 16.15 Class 4c property has a class rate of2.31.85 percent of 16.16 market value, except that (i) for each parcel of seasonal 16.17 residential recreational property not used for commercial 16.18 purposes under clause (5) the first $72,000 of market value on 16.19 each parcel has a class rate of1.75 percent for taxes payable16.20in 1997 and 1.51.2 percentfor taxes payable in 1998 and16.21thereafter, and the market value of each parcel that exceeds 16.22 $72,000 has a class rate of2.5two percent, and (ii) 16.23 manufactured home parks assessed under clause (8) have a class 16.24 rate oftwo1.7 percentfor taxes payable in 1996, and16.25thereafterof market value. 16.26 (d) Class 4d property includes: 16.27 (1) a structure that is: 16.28 (i) situated on real property that is used for housing for 16.29 the elderly or for low and moderate income families as defined 16.30 by the Farmers Home Administration; 16.31 (ii) located in a municipality of less than 10,000 16.32 population; and 16.33 (iii) financed by a direct loan or insured loan from the 16.34 Farmers Home Administration. Property is classified under this 16.35 clause for 15 years from the date of the completion of the 16.36 original construction or for the original term of the loan. 17.1 The class rates in paragraph (c), clauses (1), (2), and (3) 17.2 and this clause apply to the properties described in them, only 17.3 in proportion to occupancy of the structure by elderly or 17.4 handicapped persons or low and moderate income families as 17.5 defined in the applicable laws unless construction of the 17.6 structure had been commenced prior to January 1, 1984; or the 17.7 project had been approved by the governing body of the 17.8 municipality in which it is located prior to June 30, 1983; or 17.9 financing of the project had been approved by a federal or state 17.10 agency prior to June 30, 1983. For those properties, 4c or 4d 17.11 classification is available only for those units meeting the 17.12 requirements of section 273.1318. 17.13 Classification under this clause is only available to 17.14 property of a nonprofit or limited dividend entity. 17.15 In the case of a structure financed or refinanced under any 17.16 federal or state mortgage insurance or direct loan program 17.17 exclusively for housing for the elderly or for housing for the 17.18 handicapped, a unit shall be considered occupied so long as it 17.19 is actually occupied by an elderly or handicapped person or, if 17.20 vacant, is held for rental to an elderly or handicapped person. 17.21 (2)For taxes payable in 1992, 1993, and 1994, only,17.22buildings and appurtenances, together with the land upon which17.23they are located, leased by the occupant under the community17.24lending model lease-purchase mortgage loan program administered17.25by the Federal National Mortgage Association, provided the17.26occupant's income is no greater than 60 percent of the county or17.27area median income, adjusted for family size and the building17.28consists of existing single family or duplex housing. The lease17.29agreement must provide for a portion of the lease payment to be17.30escrowed as a nonrefundable down payment on the housing. To17.31qualify under this clause, the taxpayer must apply to the county17.32assessor by May 30 of each year. The application must be17.33accompanied by an affidavit or other proof required by the17.34assessor to determine qualification under this clause.17.35(3)Qualifying buildings and appurtenances, together with 17.36 the land upon which they are located, leased for a period of up 18.1 to five years by the occupant under a lease-purchase program 18.2 administered by the Minnesota housing finance agency or a 18.3 housing and redevelopment authority authorized under sections 18.4 469.001 to 469.047, provided the occupant's income is no greater 18.5 than 80 percent of the county or area median income, adjusted 18.6 for family size, and the building consists of two or less 18.7 dwelling units. The lease agreement must provide for a portion 18.8 of the lease payment to be escrowed as a nonrefundable down 18.9 payment on the housing. The administering agency shall verify 18.10 the occupants income eligibility and certify to the county 18.11 assessor that the occupant meets the income criteria under this 18.12 paragraph. To qualify under this clause, the taxpayer must 18.13 apply to the county assessor by May 30 of each year. For 18.14 purposes of this section, "qualifying buildings and 18.15 appurtenances" shall be defined as one or two unit residential 18.16 buildings which are unoccupied and have been abandoned and 18.17 boarded for at least six months. 18.18 Class 4d property has a class rate oftwo1.7 percent of 18.19 market value except that property classified under 18.20 clause(3)(2), shall have the same class rate as class 1a 18.21 property. 18.22 (e) Residential rental property that would otherwise be 18.23 assessed as class 4 property under paragraph (a); paragraph (b), 18.24 clauses (1) and (3); paragraph (c), clause (1), (2), (3), or 18.25 (4), is assessed at the class rate applicable to it under 18.26 Minnesota Statutes 1988, section 273.13, if it is found to be a 18.27 substandard building under section 273.1316. Residential rental 18.28 property that would otherwise be assessed as class 4 property 18.29 under paragraph (d) is assessed at2.3two percent of market 18.30 value if it is found to be a substandard building under section 18.31 273.1316. 18.32 (f) Class 4e property consists of the residential portion 18.33 of any structure located within a city that was converted from 18.34 nonresidential use to residential use, provided that: 18.35 (1) the structure had formerly been used as a warehouse; 18.36 (2) the structure was originally constructed prior to 1940; 19.1 (3) the conversion was done after December 31, 1995, but 19.2 before January 1, 2003; and 19.3 (4) the conversion involved an investment of at least 19.4 $25,000 per residential unit. 19.5 Class 4e property has a class rate of2.31.85 percent of 19.6 market value, provided that a structure is eligible for class 4e 19.7 classification only in the 12 assessment years immediately 19.8 following the conversion. 19.9 Sec. 5. Minnesota Statutes 1996, section 273.13, 19.10 subdivision 31, is amended to read: 19.11 Subd. 31. [CLASS 5.] Class 5 property includes: 19.12 (1) tools, implements, and machinery of an electric 19.13 generating, transmission, or distribution system or a pipeline 19.14 system transporting or distributing water, gas, crude oil, or 19.15 petroleum products or mains and pipes used in the distribution 19.16 of steam or hot or chilled water for heating or cooling 19.17 buildings, which are fixtures; 19.18 (2) unmined iron ore and low-grade iron-bearing formations 19.19 as defined in section 273.14; and 19.20 (3) all other property not otherwise classified. 19.21 Class 5 property has a class rate of5.063.35 percent of 19.22 market value. 19.23 Sec. 6. [TIF GRANTS; APPROPRIATIONS.] 19.24 (a) The commissioner of revenue shall pay grants to 19.25 municipalities, as defined in Minnesota Statutes, section 19.26 469.174, subdivision 6, for deficits in tax increment financing 19.27 districts caused by the changes in class rates under this 19.28 article. Municipalities must submit applications for the grants 19.29 in a form prescribed by the commissioner by no later than March 19.30 1 for taxes payable during the calendar year. The maximum grant 19.31 equals the lesser of: 19.32 (1) the reduction in the tax increment financing district's 19.33 revenues derived from increment resulting from the class rate 19.34 reductions under this article; and 19.35 (2) the amount by which the municipality's total available 19.36 tax increments, including those from previous years, are less 20.1 than the amount due during the calendar year to pay bonds issued 20.2 and sold before and binding contracts entered into before May 20.3 19, 1997. 20.4 If the total applications for grants exceed the amount 20.5 available under the appropriation, the commissioner shall 20.6 proportionately reduce the grant for each municipality. These 20.7 grants are available for calendar years 1998, 1999, and 2000. 20.8 (b) $6,500,000 is appropriated in fiscal year 1999 to the 20.9 commissioner of revenue for purposes of this section. 20.10 $5,000,000 is appropriated in fiscal year 2000 to the 20.11 commissioner of revenue for purposes of this section. 20.12 $5,000,000 is appropriated in fiscal year 2001 to the 20.13 commissioner of revenue for purposes of this section. These 20.14 appropriations do not cancel until June 30, 2001. 20.15 Sec. 7. [REPEALER.] 20.16 Minnesota Statutes 1996, sections 273.13, subdivision 32; 20.17 and 473.3915, are repealed. 20.18 Sec. 8. [EFFECTIVE DATES.] 20.19 Sections 1 to 5 and 7 are effective for taxes payable in 20.20 1998 and thereafter. Section 6 is effective for grants made in 20.21 calendar year 1998, 1999, and 2000. 20.22 ARTICLE 2 20.23 EDUCATION LEVY, AID, AND CREDIT 20.24 Section 1. [273.1382] [EDUCATION HOMESTEAD CREDIT.] 20.25 Subdivision 1. [EDUCATION HOMESTEAD CREDIT.] Each year, 20.26 beginning with property taxes payable in 1998, the respective 20.27 county auditors shall determine the local tax rate for each 20.28 school district for the general education levy certified under 20.29 section 124A.23, subdivision 2 or 3. That rate shall be the 20.30 general education homestead credit local tax rate for the 20.31 district. The auditor shall then determine a general education 20.32 homestead credit for each homestead within the county by 20.33 multiplying the general education homestead credit local tax 20.34 rate times the net tax capacity of the homestead for the taxes 20.35 payable year times 50 percent. The amount of general education 20.36 homestead credit for a homestead is limited to $450. 21.1 Subd. 2. [CREDIT REIMBURSEMENTS.] (a) The commissioner of 21.2 revenue shall determine the tax reductions allowed under this 21.3 section for each taxes payable year, and for each school 21.4 district based upon a review of the abstracts of tax lists 21.5 submitted by the county auditors under section 275.29, and from 21.6 any other information which the commissioner deems relevant. 21.7 The commissioner of revenue shall generally compute the tax 21.8 reductions at the unique taxing jurisdiction level, however the 21.9 commissioner may compute the tax reductions at a higher 21.10 geographic level if that would have a negligible impact, or if 21.11 changes in the composition of unique taxing jurisdictions do not 21.12 permit computation at the unique taxing jurisdiction level. The 21.13 commissioner's determinations under this paragraph are not rules. 21.14 (b) The commissioner of revenue shall certify the total of 21.15 the tax reductions granted under this section for each taxes 21.16 payable year within each school district to the commissioner of 21.17 children, families, and learning after July 1 and on or before 21.18 August 1 of the taxes payable year. The commissioner of 21.19 children, families, and learning shall reimburse each affected 21.20 school district for the amount of the property tax reductions 21.21 allowed under this section as provided in section 273.1392. The 21.22 commissioner of children, families, and learning shall treat the 21.23 reimbursement payments as entitlements for the same state fiscal 21.24 year as certified, including with each district's initial 21.25 payment all amounts that would have been paid up to that date, 21.26 computed as if 90 percent of the annual reimbursement amount for 21.27 the district were being paid one-twelfth in each month of the 21.28 fiscal year. 21.29 Subd. 3. [PROPERTY TAX STATEMENTS.] The credit amount 21.30 under this section for each homestead shall reduce the amount of 21.31 property taxes otherwise payable to the county treasurer in that 21.32 payable year, and must be separately stated on the property tax 21.33 statement as a reduction, which reduction shall be identified as 21.34 "general education homestead credit." The tax statement must 21.35 indicate that the credit amount under this section reduces the 21.36 "state general education tax" on the property. 22.1 Subd. 4. [APPROPRIATION.] An amount sufficient to make the 22.2 payments required by this section is annually appropriated from 22.3 the general fund to the commissioner of children, families, and 22.4 learning. 22.5 Sec. 2. Minnesota Statutes 1996, section 273.1393, is 22.6 amended to read: 22.7 273.1393 [COMPUTATION OF NET PROPERTY TAXES.] 22.8 Notwithstanding any other provisions to the contrary, "net" 22.9 property taxes are determined by subtracting the credits in the 22.10 order listed from the gross tax: 22.11 (1) disaster credit as provided in section 273.123; 22.12 (2) powerline credit as provided in section 273.42; 22.13 (3) agricultural preserves credit as provided in section 22.14 473H.10; 22.15 (4) enterprise zone credit as provided in section 469.171; 22.16 (5) disparity reduction credit; 22.17 (6) conservation tax credit as provided in section 273.119; 22.18 (7) taconite homestead credit as provided in section 22.19 273.135;and22.20 (8) supplemental homestead credit as provided in section 22.21 273.1391; and 22.22 (9) general education homestead credit as provided in 22.23 section 273.1382. 22.24 The combination of all property tax credits must not exceed 22.25 the gross tax amount. 22.26 Sec. 3. Minnesota Statutes 1996, section 477A.013, 22.27 subdivision 9, is amended to read: 22.28 Subd. 9. [CITY AID DISTRIBUTION.] (a) In calendar year 22.2919941999 and thereafter, each city shall receive an aid 22.30 distribution equal to the sum of (1) the city formula aid under 22.31 subdivision 8 for aid payable in 1998, and (2) its city aid base 22.32 as determined for aid payable in the prior year. 22.33 (b) The percentage increase for a first class city in 22.34 calendar year 1995 and thereafter shall not exceed the 22.35 percentage increase in the sum of the aid to all cities under 22.36 this section in the current calendar year compared to the sum of 23.1 the aid to all cities in the previous year. 23.2 (c) The total aid for any city, except a first class city, 23.3 shall not exceed the sum of (1) ten percent of the city's net 23.4 levy for the year prior to the aid distribution plus (2) its 23.5 total aid in the previous year before any increases or decreases 23.6 under sections 16A.711, subdivision 5, and 477A.0132. 23.7(d) Notwithstanding paragraph (c), in 1995 only, for cities23.8which in 1992 or 1993 transferred an amount from governmental23.9funds to their sewer and water fund in an amount greater than23.10their net levy for taxes payable in the year in which the23.11transfer occurred, the total aid shall not exceed the sum of (1)23.1220 percent of the city's net levy for the year prior to the aid23.13distribution plus (2) its total aid in the previous year before23.14any increases or decreases under sections 16A.711, subdivision23.155, and 477A.0132.23.16 Sec. 4. Minnesota Statutes 1996, section 477A.03, 23.17 subdivision 2, is amended to read: 23.18 Subd. 2. [ANNUAL APPROPRIATION.] A sum sufficient to 23.19 discharge the duties imposed by sections 477A.011 to 477A.014 is 23.20 annually appropriated from the general fund to the commissioner 23.21 of revenue. For aids payable in 1996 and thereafter, the total 23.22 aids paid undersections 477A.013, subdivision 9, andsection 23.23 477A.0122 are the amounts certified to be paid in the previous 23.24 year, adjusted for inflation as provided under subdivision 3. 23.25 Aid payments to counties under section 477A.0121 are limited to 23.26 $20,265,000 in 1996. Aid payments to counties under section 23.27 477A.0121 are limited to $27,571,625 in 1997. For aid payable 23.28 in 1998 and thereafter, the total aids paid under section 23.29 477A.0121 are the amounts certified to be paid in the previous 23.30 year, adjusted for inflation as provided under subdivision 23.31 3. For aid payable in fiscal year 2000 and thereafter, the 23.32 total amount appropriated for the aids under section 477A.013, 23.33 subdivision 9, is the total amount of aids determined under that 23.34 section for payment in the previous year. 23.35 Sec. 5. [GENERAL EDUCATION LEVY INCREASES.] 23.36 Except as provided in section 6, regardless of any other 24.1 law to the contrary, the dollar amount contained in Minnesota 24.2 Statutes, section 124A.23, subdivision 1, may not be increased 24.3 with regard to fiscal year 1998 or any later fiscal year, either 24.4 by an amendment of that section or by the enactment of, or 24.5 change to, another statute or law, unless such increase is 24.6 approved by a 60 percent vote in each house of the legislature. 24.7 Sec. 6. [GENERAL EDUCATION LEVY REDUCTION.] 24.8 For fiscal year 1999, general education aid under Minnesota 24.9 Statutes, section 124A.23, subdivision 4, is increased by 24.10 $150,000,000 over the general education aid expenditure for 24.11 fiscal year 1998. For fiscal year 2000, general education aid 24.12 under Minnesota Statutes, section 124A.23, subdivision 4, is 24.13 increased by $60,600,000 over the general education aid 24.14 expenditure for fiscal year 1999. For fiscal year 2001, general 24.15 education aid is increased by $56,100,000 over the general 24.16 education aid expenditure for fiscal year 2000. The general 24.17 education aid increases under this provision must be used to 24.18 decrease the general education levy under Minnesota Statutes, 24.19 section 124A.23, subdivision 1, by $150,000,000 for taxes 24.20 payable in 1998, by $60,600,000 for taxes payable in 1999, and 24.21 by $56,100,000 for taxes payable in 2000. 24.22 Sec. 7. [REPEALER.] 24.23 Minnesota Statutes 1996, section 477A.011, subdivision 37, 24.24 is repealed. 24.25 Sec. 8. [EFFECTIVE DATE.] 24.26 Sections 1 and 2 are effective for taxes payable in 1998 24.27 and thereafter, and for credit reimbursement payments to school 24.28 districts in fiscal year 1999 and thereafter. Sections 3, 4, 24.29 and 7 are effective for fiscal year 2000 and thereafter. 24.30 Section 5 is effective the day following final enactment. 24.31 Section 6 is effective for fiscal years 1999, 2000, and 2001. 24.32 ARTICLE 3 24.33 TRUTH IN BUDGETING 24.34 Section 1. [275.0641] [BUDGET HEARINGS; NOTICE.] 24.35 Subdivision 1. [PUBLICATION OF EXPENDITURE DATA.] 24.36 Notwithstanding any other law or charter to the contrary, on or 25.1 before May 25, each taxing authority shall publish prior year 25.2 and anticipated current year expenditure information for the 25.3 taxing authority broken down by categories of service. The 25.4 service categories for the expenditure information shall be 25.5 determined by the commissioner of revenue, based on the 25.6 governmental expenditure categories found in the state auditor's 25.7 publications of revenues and expenditures for counties and 25.8 cities. For purposes of this section, "taxing authority" 25.9 includes all counties, home rule charter and statutory cities, 25.10 school districts, and metropolitan special taxing districts as 25.11 defined in section 275.065, subdivision 3. It excludes towns, 25.12 all other special taxing districts, and the school districts 25.13 deemed to be special taxing districts by section 275.065, 25.14 subdivision 1. For a taxing authority located in two or more 25.15 counties, the publication of prior year and anticipated current 25.16 year expenditure data is to be made in each county in which the 25.17 taxing authority is located. 25.18 Subd. 2. [REPORT OF FIRST BUDGET HEARING.] At the same 25.19 time as expenditure data is published under subdivision 1, each 25.20 taxing authority shall also publish the date, time, and location 25.21 for its first budget hearing for the next year. If the first 25.22 budget hearing for the next year is to be held prior to May 30 25.23 of the current levy year, the taxing authority shall publish the 25.24 date, time, and location for the earliest budget hearing for the 25.25 next year to be held after May 29 of the current levy year. 25.26 Subd. 3. [PUBLICATION.] (a) The publication required under 25.27 this section must include all the information required under 25.28 this section and must be at least one-eighth page in size of a 25.29 standard-size or a tabloid-size newspaper. It must not be 25.30 placed in the part of the newspaper where legal notices and 25.31 classified advertisements appear, and it must be published in an 25.32 official newspaper of general circulation in the taxing 25.33 authority. The newspaper selected must be one of general 25.34 interest and readership in the community, and not one of limited 25.35 subject matter. The publication must appear in a newspaper that 25.36 is published at least once per week. For purposes of this 26.1 section, the metropolitan special taxing districts must publish 26.2 only in the Minneapolis Star and Tribune and the Saint Paul 26.3 Pioneer Press. 26.4 (b) The published item must be entitled: "NOTICE OF 26.5 CURRENT BUDGETS AND BUDGET HEARINGS." The commissioner of 26.6 revenue, subject to the approval of the chairs of the house and 26.7 senate tax committees, will prescribe all other matters of form 26.8 and content. 26.9 Subd. 4. [STATE AUDITOR'S DUTIES.] As an aid to counties 26.10 and cities in seeing how their expenditure information is to be 26.11 published, the state auditor shall provide by March 15 each year 26.12 to each county and city a breakdown of the county's or city's 26.13 expenditures by the service categories listed on the budget 26.14 notice prescribed by the commissioner of revenue. The breakdown 26.15 of expenditure data shall be for the most recent year available 26.16 in the state auditor's database. In addition, the state auditor 26.17 shall provide assistance to counties, cities, and metropolitan 26.18 special taxing districts concerning the breakdown of their prior 26.19 year and anticipated current year expenditure data that is to be 26.20 published. 26.21 Subd. 5. [DUTIES OF COMMISSIONER OF CHILDREN, FAMILIES, 26.22 AND LEARNING.] As an aid to school districts in seeing how their 26.23 expenditure information is to be published, the commissioner of 26.24 children, families, and learning shall provide by March 15 each 26.25 year to each school district a breakdown of the school 26.26 district's expenditures by the service categories listed on the 26.27 budget notice prescribed by the commissioner of revenue. The 26.28 breakdown of expenditure data shall be for the most recent year 26.29 available in the department of children, families, and 26.30 learning's database. In addition, the commissioner of children, 26.31 families, and learning shall provide assistance to school 26.32 districts concerning the breakdown of their prior year and 26.33 anticipated current year expenditure data that is to be 26.34 published. 26.35 Subd. 6. [COMMISSIONER OF REVENUE'S DUTIES.] The 26.36 commissioner of revenue shall prescribe the form of the notice 27.1 of current budgets and budget hearings to be published by each 27.2 taxing authority. On or before March 1 of 1998 and of each year 27.3 thereafter, the commissioner of revenue shall send to each 27.4 taxing authority, and to the state auditor and the commissioner 27.5 of children, families, and learning, the prescribed form of the 27.6 notice to be used in the current year. On or before April 15 27.7 the commissioner of revenue shall supply each taxing authority 27.8 other than a school district with the total number of households 27.9 for that taxing authority based on the most recent household 27.10 information available from the state demographer. In addition, 27.11 on or before April 15 the commissioner of revenue shall supply 27.12 each school district with the total number of pupils for that 27.13 district for the most recent school year available from the 27.14 department of children, families, and learning. 27.15 Subd. 7. [CERTIFICATION OF COMPLIANCE.] At, or before, the 27.16 time the taxing authority certifies its tax levy under section 27.17 275.07, it shall certify to the commissioner of revenue its 27.18 compliance with this section. The certification must contain 27.19 the information required by the commissioner of revenue to 27.20 determine compliance with this section. If the commissioner 27.21 determines that the taxing authority has failed to substantially 27.22 comply with the requirements of this section, the commissioner 27.23 of revenue shall notify the county auditor. The decision of the 27.24 commissioner is final. When fixing rates under section 275.08 27.25 for a taxing authority that has not complied with this section, 27.26 the county auditor must use the taxing authority's previous 27.27 year's levy, plus any additional amounts necessary to pay 27.28 principal and interest on general obligation bonds of the taxing 27.29 authority for which its taxing powers have been pledged if the 27.30 bonds were issued before May 19, 1997. 27.31 Sec. 2. Minnesota Statutes 1996, section 275.065, 27.32 subdivision 3, is amended to read: 27.33 Subd. 3. [NOTICE OF PROPOSED PROPERTY TAXES.] (a) The 27.34 county auditor shall prepare and the county treasurer shall 27.35 deliver after November 10 and on or before November2417 each 27.36 year, by first class mail to each taxpayer at the address listed 28.1 on the county's current year's assessment roll, a notice of 28.2 proposed property taxes and, in the case of a town, final 28.3 property taxes. 28.4 (b) The commissioner of revenue shall prescribe the form of 28.5 the notice. 28.6 (c) The notice must inform taxpayers that it contains the 28.7 amount of property taxes each taxing authority other than a town 28.8 proposes to collect for taxes payable the following year and, 28.9 for a town, the amount of its final levy. It must clearly state 28.10 that each taxing authority, including regional library districts 28.11 established under section 134.201, and including the 28.12 metropolitan taxing districts as defined in paragraph (i), but 28.13 excluding all other special taxing districts, school districts, 28.14 and towns, will hold a public meeting to receive public 28.15 testimony on the proposed budget and proposed or final property 28.16 tax levy, or, in case of a school district, on the current28.17budget and proposed property tax levy. It must clearly state 28.18 the time and place of each taxing authority's meeting and an 28.19 address where comments will be received by mail. 28.20 (d) The notice must state for each parcel the following 28.21 items listed in this sequential order: 28.22 (1) the market value of the property as determined under 28.23 section 273.11, and used for computing property taxes payable in 28.24 the following year and for taxes payable in the current year; 28.25 and, in the case of residential property, whether the property 28.26 is classified as homestead or nonhomestead. The notice must 28.27 clearly inform taxpayers of the years to which the market values 28.28 apply and that the values are final values; 28.29 (2) the property tax amount for the following year based on 28.30 each taxing authority's constant spending levy amount. This 28.31 amount must be listed by county, city or town, school district, 28.32 the state education tax, the total of the special taxing 28.33 districts, the tax increment tax, if any, the fiscal disparities 28.34 tax, if any, and a total of all taxing authorities. The 28.35 reduction in the state education tax for the parcel resulting 28.36 from the general education homestead credit must also be shown; 29.1 (3) the proposed property tax amount for the following year 29.2byfor the county, the city or town, the school district 29.3excess referenda levy, remaining school district levy, regional29.4library district, if in existence, the total of the metropolitan29.5special taxing districts as defined in paragraph (i) and, the 29.6 state education tax, the sum of theremainingspecial taxing 29.7 districts, andasa total of all the taxing authorities,29.8including all special taxing districts, the proposed or, for. 29.9 For a town, the proposed amount is its final net tax on the 29.10 property for taxes payable the following yearand the actual tax29.11for taxes payable the current year.If a school district has29.12certified under section 124A.03, subdivision 2, that a29.13referendum will be held in the school district at the November29.14general election, the county auditor must note next to the29.15school district's proposed amount that a referendum is pending29.16and that, if approved by the voters, the tax amount may be29.17higher than shown on the notice. For the purposes of this29.18subdivision, "school district excess referenda levy" means29.19school district taxes for operating purposes approved at29.20referendums, including those taxes based on net tax capacity as29.21well as those based on market value. "School district excess29.22referenda levy" does not include school district taxes for29.23capital expenditures approved at referendums or school district29.24taxes to pay for the debt service on bonds approved at29.25referenda.In the case of the city of Minneapolis, the levy for 29.26 the Minneapolis library board and the levy for Minneapolis park 29.27 and recreation shall be listed separately from the remaining 29.28 amount of the city's levy. In the case of a parcel where tax 29.29 increment or the fiscal disparities areawide tax under chapter 29.30 276A or 473F applies, the proposed tax levy on the captured 29.31 value or the proposed tax levy on the tax capacity subject to 29.32 the areawide tax must each be stated separately and not included 29.33 in the sum of the special taxing districts. The reduction in 29.34 the state education tax for the parcel resulting from the 29.35 general education homestead credit must also be shown;and29.36(3)(4) the increase or decreaseinbetween the amounts in 30.1clauseclauses (2)from taxes payable in the current year to30.2proposed or, for a town, final taxes payable the following year,30.3 and (3) expressed as a dollar amount and as a percentage; and 30.4 (5) the total actual taxes for the current year for all 30.5 taxing authorities for the parcel. 30.6 (e) The notice must clearly state that the proposed or 30.7 final taxes do not include the following: 30.8 (1) special assessments; 30.9 (2) levies approved by the voters after the date the 30.10 proposed taxes are certified, including bond referenda,school30.11district levy referenda,and levy limit increase referenda; 30.12 (3) amounts necessary to pay cleanup or other costs due to 30.13 a natural disaster occurring after the date the proposed taxes 30.14 are certified; 30.15 (4) amounts necessary to pay tort judgments against the 30.16 taxing authority that become final after the date the proposed 30.17 taxes are certified; and 30.18 (5) the contamination tax imposed on properties which 30.19 received market value reductions for contamination. 30.20 (f) Except as provided in subdivision 7, failure of the 30.21 county auditor to prepare or the county treasurer to deliver the 30.22 notice as required in this section does not invalidate the 30.23 proposed or final tax levy or the taxes payable pursuant to the 30.24 tax levy. 30.25 (g) If the notice the taxpayer receives under this section 30.26 lists the property as nonhomestead and the homeowner provides 30.27 satisfactory documentation to the county assessor that the 30.28 property is owned and used as the owner's homestead, the 30.29 assessor shall reclassify the property to homestead for taxes 30.30 payable in the following year. 30.31 (h) In the case of class 4 residential property used as a 30.32 residence for lease or rental periods of 30 days or more, the 30.33 taxpayer must either: 30.34 (1) mail or deliver a copy of the notice of proposed 30.35 property taxes to each tenant, renter, or lessee; or 30.36 (2) post a copy of the notice in a conspicuous place on the 31.1 premises of the property. 31.2 The notice must be mailed or posted by the taxpayer by 31.3 November 27 or within three days of receipt of the notice, 31.4 whichever is later. A taxpayer may notify the county treasurer 31.5 of the address of the taxpayer, agent, caretaker, or manager of 31.6 the premises to which the notice must be mailed in order to 31.7 fulfill the requirements of this paragraph. 31.8 (i) For purposes of this subdivision, subdivisions 5a and 31.9 6, "metropolitan special taxing districts" means the following 31.10 taxing districts in the seven-county metropolitan area that levy 31.11 a property tax for any of the specified purposes listed below: 31.12 (1) metropolitan council under section 473.132, 473.167, 31.13 473.249, 473.325, 473.446, 473.521, 473.547, or 473.834; 31.14 (2) metropolitan airports commission under section 473.667, 31.15 473.671, or 473.672; and 31.16 (3) metropolitan mosquito control commission under section 31.17 473.711. 31.18 For purposes of this section, any levies made by the 31.19 regional rail authorities in the county of Anoka, Carver, 31.20 Dakota, Hennepin, Ramsey, Scott, or Washington under chapter 31.21 398A shall be included with the appropriate county's levy and 31.22 shall be discussed at that county's public hearing. 31.23(j) For taxes levied in 1996, payable in 1997 only, in the31.24case of a statutory or home rule charter city or town that31.25exercises the local levy option provided in section 473.388,31.26subdivision 7, the notice of its proposed taxes may include a31.27statement of the amount by which its proposed tax increase for31.28taxes payable in 1997 is attributable to its exercise of that31.29option, together with a statement that the levy of the31.30metropolitan council was decreased by a similar amount because31.31of the exercise of that option.31.32 Sec. 3. Minnesota Statutes 1996, section 275.065, is 31.33 amended by adding a subdivision to read: 31.34 Subd. 3a. [CONSTANT SPENDING LEVY AMOUNT.] (a) For 31.35 purposes of this section, "constant spending levy amount" for a 31.36 county, school district, city, town, or special taxing district 32.1 means the property tax levy that the taxing authority would need 32.2 to levy so that its levy, including its fiscal disparities 32.3 distribution levy under section 276A.06, subdivision 3, clause 32.4 (a), or 473F.08, subdivision 3, clause (a), would remain 32.5 constant from the current year to the proposed year. 32.6 (b) For purposes of the state education tax, "constant 32.7 spending levy amount" means the state general education tax that 32.8 would be computed for the property using the current year's 32.9 state general education tax rate applicable to the property and 32.10 the proposed year's taxable value. 32.11 Sec. 4. Minnesota Statutes 1996, section 275.065, 32.12 subdivision 5a, is amended to read: 32.13 Subd. 5a. [PUBLIC ADVERTISEMENT.] (a) A city that has a 32.14 population of more than 2,500, county, a metropolitan special 32.15 taxing district as defined in subdivision 3, paragraph (i), or a 32.16 regional library district established under section 134.201, or32.17school districtshall advertise in a newspaper a notice of its 32.18 intent to adopt a budget and property tax levyor, in the case32.19of a school district, to review its current budget and32.20proposedfor property taxes payable in the following year, at a 32.21 public hearing. The notice must be published not less than two 32.22 business days nor more than six business days before the hearing. 32.23 The advertisement must be at least one-eighth page in size 32.24 of a standard-size or a tabloid-size newspaper. The 32.25 advertisement must not be placed in the part of the newspaper 32.26 where legal notices and classified advertisements appear. The 32.27 advertisement must be published in an official newspaper of 32.28 general circulation in the taxing authority. The newspaper 32.29 selected must be one of general interest and readership in the 32.30 community, and not one of limited subject matter. The 32.31 advertisement must appear in a newspaper that is published at 32.32 least once per week. 32.33 For purposes of this section, the metropolitan special 32.34 taxing district's advertisement must only be published in the 32.35 Minneapolis Star and Tribune and the Saint Paul Pioneer Press. 32.36 (b) The advertisement for metropolitan special taxing 33.1 districts and regional library districts must be in the 33.2 following form, except that the notice for a school district may33.3include references to the current budget in regard to proposed33.4property taxes. 33.5 "NOTICE OF 33.6 PROPOSED PROPERTY TAXES 33.7 (City/County/School District/Metropolitan 33.8 Special Taxing District/Regional 33.9 Library District) of ......... 33.10 The governing body of ........ will soon hold budget hearings 33.11 and vote on the property taxes for (city/county/metropolitan 33.12 special taxing district/regional library district services that 33.13 will be provided in199_/school district services that will be33.14provided in 199_ and 199_(year)). 33.15 NOTICE OF PUBLIC HEARING: 33.16 All concerned citizens are invited to attend a public hearing 33.17 and express their opinions on the proposed (city/county/school33.18district/metropolitan special taxing district/regional library 33.19 district) budget and property taxes,or in the case of a school33.20district, its current budget and proposed property taxes,33.21 payable in the following year. The hearing will be held on 33.22 (Month/Day/Year) at (Time) at (Location, Address)." 33.23 (c) The advertisement for cities and counties must be in 33.24 the following form. 33.25 "NOTICE OF PROPOSED 33.26 TOTAL BUDGET AND PROPERTY TAXES 33.27 The (city/county) governing body or board of commissioners will 33.28 hold a public hearing to discuss the budget and to vote on the 33.29 amount of property taxes to collect for services the 33.30 (city/county) will provide in (year). 33.31 33.32 SPENDING: The total budget amounts below compare 33.33 (city's/county's) (year) total actual budget with the amount the 33.34 (city/county) proposes to spend in (year). 33.35 33.36 (Year) Total Proposed (Year) Change from 34.1 Actual Budget Budget (Year)-(Year) 34.2 34.3 $....... $....... ...% 34.4 34.5 TAXES: The property tax amounts below compare that portion of 34.6 the current budget levied in property taxes in (city/county) for 34.7 (year) with the property taxes the (city/county) proposes to 34.8 collect in (year). 34.9 34.10 (Year) Property Proposed (Year) Change from 34.11 Taxes Property Taxes (Year)-(Year) 34.12 34.13 $....... $....... ...% 34.14 34.15 ATTEND THE PUBLIC HEARING 34.16 All (city/county) residents are invited to attend the public 34.17 hearing of the (city/county) to express your opinions on the 34.18 budget and the proposed amount of (year) property taxes. The 34.19 hearing will be held on: 34.20 (Month/Day/Year/Time) 34.21 (Location/Address) 34.22 If the discussion of the budget cannot be completed, a time and 34.23 place for continuing the discussion will be announced at the 34.24 hearing. You are also invited to send your written comments to: 34.25 (City/County) 34.26 (Location/Address)" 34.27 (d) For purposes of this subdivision, the budget amounts 34.28 listed on the advertisement mean: 34.29 (1) for cities, the total government fund expenditures, as 34.30 defined by the state auditor under section 471.6965, less any 34.31 expenditures for improvements or services that are specially 34.32 assessed or charged under chapter 429, 430, 435, or the 34.33 provisions of any other law or charter; and 34.34 (2) for counties, the total government fund expenditures, 34.35 as defined by the state auditor under section 375.169, less any 34.36 expenditures for direct payments to recipients or providers for 35.1 the human service aids listed in section 273.1398, subdivision 35.2 1, paragraph (i). 35.3(c)(e) A city with a population of over 500 but not more 35.4 than 2,500 must advertise by posted notice as defined in section 35.5 645.12, subdivision 1. The advertisement must be posted at the 35.6 time provided in paragraph (a). It must be in the form required 35.7 in paragraph (b). 35.8(d)(f) For purposes of this subdivision, the population of 35.9 a city is the most recent population as determined by the state 35.10 demographer under section 4A.02. 35.11(e)(g) The commissioner of revenue, subject to the 35.12 approval of the chairs of the house and senate tax committees, 35.13 shall prescribe the form and format of the advertisement. 35.14(f) For calendar year 1993, each taxing authority required35.15to publish an advertisement must include on the advertisement a35.16statement that information on the increases or decreases of the35.17total budget, including employee and independent contractor35.18compensation in the prior year, current year, and proposed35.19budget year will be discussed at the hearing.35.20(g) Notwithstanding paragraph (f), for 1993, the35.21commissioner of revenue shall prescribe the form, format, and35.22content of an advertisement comparing current and proposed35.23expense budgets for the metropolitan council, the metropolitan35.24airports commission, and the metropolitan mosquito control35.25commission. The expense budget must include occupancy,35.26personnel, contractual and capital improvement expenses. The35.27form, format, and content of the advertisement must be approved35.28by the chairs of the house and senate tax committees prior to35.29publication.35.30 Sec. 5. Minnesota Statutes 1996, section 275.065, 35.31 subdivision 6, is amended to read: 35.32 Subd. 6. [PUBLIC HEARING; ADOPTION OF BUDGET AND LEVY.] 35.33 Between November2919 and December2010, the governing bodies 35.34 of a city that has a population over 500, county, metropolitan 35.35 special taxing districts as defined in subdivision 3, paragraph 35.36 (i), and regional library districts shall each hold a public 36.1 hearing to review, discuss, and seek public comment on its 36.2 current budget, and its final budget and property tax levy for 36.3 taxes payable in the following year, and the governing body of36.4the school district shall hold a public hearing to review its36.5current budget and proposed property tax levy for taxes payable36.6in the following year. The metropolitan special taxing 36.7 districts shall be required to hold only a single joint public 36.8 hearing, the location of which will be determined by the 36.9 affected metropolitan agencies. 36.10 At a subsequent hearing, each county,school district,36.11 city, and metropolitan special taxing district may amend its 36.12 proposed property tax levy and must adopt a final property tax 36.13 levy. Each county, city, and metropolitan special taxing 36.14 district may also amend its proposed budget and must adopt a 36.15 final budget at the subsequent hearing.A school district is36.16not required to adopt its final budget at the subsequent36.17hearing.The subsequent hearing of a taxing authority must be 36.18 held on a date subsequent to the date of the taxing authority's 36.19 initial public hearing, or subsequent to the date of its 36.20 continuation hearing if a continuation hearing is held. The 36.21 subsequent hearing may be held at a regularly scheduled board or 36.22 council meeting or at a special meeting scheduled for the 36.23 purposes of the subsequent hearing. The subsequent hearing of a 36.24 taxing authority does not have to be coordinated by the county 36.25 auditor to prevent a conflict with an initial hearing, a 36.26 continuation hearing, or a subsequent hearing of any other 36.27 taxing authority. All subsequent hearings must be held prior to 36.28 five working days after December2010 of the levy year. 36.29 The time and place of the subsequent hearing must be 36.30 announced at the initial public hearing or at the continuation 36.31 hearing. 36.32 The property tax levy certified under section 275.07 by a 36.33 city, county, metropolitan special taxing district, regional 36.34 library district, or school district must not exceed the 36.35 proposed levy determined under subdivision 1, except by an 36.36 amount up to the sum of the following amounts: 37.1 (1) the amount of a school district levy whose voters 37.2 approved a referendum to increase taxes under section 124.82, 37.3 subdivision 3,124A.03, subdivision 2, or 124B.03, subdivision37.42,after the proposed levy was certified; 37.5 (2) the amount of a city or county levy approved by the 37.6 voters after the proposed levy was certified; 37.7 (3) the amount of a levy to pay principal and interest on 37.8 bonds approved by the voters under section 475.58 after the 37.9 proposed levy was certified; 37.10 (4) the amount of a levy to pay costs due to a natural 37.11 disaster occurring after the proposed levy was certified, if 37.12 that amount is approved by the commissioner of revenue under 37.13 subdivision 6a; 37.14 (5) the amount of a levy to pay tort judgments against a 37.15 taxing authority that become final after the proposed levy was 37.16 certified, if the amount is approved by the commissioner of 37.17 revenue under subdivision 6a; 37.18 (6) the amount of an increase in levy limits certified to 37.19 the taxing authority by the commissioner of children, families, 37.20 and learning or the commissioner of revenue after the proposed 37.21 levy was certified; and 37.22 (7) the amount required under section 124.755. 37.23 At the hearing under this subdivision, the percentage 37.24 increase in property taxes proposed by the taxing authority, if 37.25 any, and the specific purposes for which property tax revenues 37.26 are being increased must be discussed. 37.27 During the discussion, the governing body shall hear 37.28 comments regarding a proposed increase and explain the reasons 37.29 for the proposed increase. The public shall be allowed to speak 37.30 and to ask questions. At the subsequent hearing held as 37.31 provided in this subdivision, the governing body, other than the37.32governing body of a school district,shall adopt its final 37.33 property tax levy prior to adopting its final budget. 37.34 If the hearing is not completed on its scheduled date, the 37.35 taxing authority must announce, prior to adjournment of the 37.36 hearing, the date, time, and place for the continuation of the 38.1 hearing. The continued hearing must be held at least five 38.2 business days but no more than14ten business days after the 38.3 original hearing. 38.4 The hearing must be held after 5:00 p.m. if scheduled on a 38.5 day other than Saturday. No hearing may be held on a Sunday. 38.6 The governing body of a county shall hold a hearing on the 38.7secondfirst Tuesday in December each year, and may hold 38.8 additional hearings on other dates before December2010 if 38.9 necessary for the convenience of county residents. If the 38.10 county needs a continuation of its hearing, the continued 38.11 hearing shall be held on thethirdsecond Tuesday in December 38.12 even if that second Tuesday is after December 10.If the third38.13Tuesday in December falls on December 21, the county's38.14continuation hearing shall be held on Monday, December 20.The 38.15 county auditor shall provide for the coordination of hearing 38.16 dates for all cities and school districts within the county. 38.17 The metropolitan special taxing districts shall hold a 38.18 joint public hearing on the first Monday of December. A 38.19 continuation hearing, if necessary, shall be held on the second 38.20 Monday of December. 38.21 By August 10,each school board andthe board of the 38.22 regional library district shall certify to the county auditors 38.23 of the counties in which the school district or regional library 38.24 district is located the dates on which it elects to hold its 38.25 hearings and any continuations. If aschool board orregional 38.26 library district does not certify the dates by August 10, the 38.27 auditor will assign the hearing date. The dates elected or 38.28 assigned must not conflict with the hearing dates of the county 38.29 or the metropolitan special taxing districts. By August 20, the 38.30 county auditor shall notify the clerks of the cities within the 38.31 county of the dates on whichschool districts andregional 38.32 library districts have elected to hold their hearings. At the 38.33 time a city certifies its proposed levy under subdivision 1 it 38.34 shall certify the dates on which it elects to hold its hearings 38.35 and any continuations. For its initial hearing and for the 38.36 subsequent hearing at which the final property tax levy will be 39.1 adopted, the city must not select dates that conflict with the 39.2 county hearing dates, metropolitan special taxing district 39.3 dates, or with those elected by or assigned to theschool39.4districts orregional library district in which the city is 39.5 located. For continuation hearings, the city may select dates 39.6 that conflict with other taxing authorities' dates if the city 39.7 deems it necessary. 39.8 The county hearing dates and the city, metropolitan special 39.9 taxing district, and regional library district, and school39.10districthearing dates must be designated on the notices 39.11 required under subdivision 3. The continuation dates need not 39.12 be stated on the notices. 39.13 This subdivision does not apply to towns, school districts, 39.14 and special taxing districts other than regional library 39.15 districts and metropolitan special taxing districts. 39.16 Notwithstanding the requirements of this section, the 39.17 employer is required to meet and negotiate over employee 39.18 compensation as provided for in chapter 179A. 39.19 Sec. 6. Minnesota Statutes 1996, section 275.065, 39.20 subdivision 8, is amended to read: 39.21 Subd. 8. [HEARING.] Notwithstanding any other provision of 39.22 law, Ramsey county, the city of St. Paul, and independent school 39.23 district No. 625 are authorized to and shall hold their public 39.24 hearing jointly. The hearing must be held on thesecondfirst 39.25 Tuesday of December each year. The advertisement required in 39.26 subdivision 5a may be a joint advertisement. The hearing is 39.27 otherwise subject to the requirements of this section. 39.28 Ramsey county is authorized to hold an additional hearing 39.29 or hearings as provided under this section, provided that any 39.30 additional hearings must not conflict with the hearing dates of 39.31 the other taxing districts. However, if Ramsey county elects 39.32 not to hold such additional hearing or hearings, the joint 39.33 hearing required by this subdivision must be held in a St. Paul 39.34 location convenient to residents of Ramsey county. 39.35 Sec. 7. Minnesota Statutes 1996, section 275.065, is 39.36 amended by adding a subdivision to read: 40.1 Subd. 9. [REVERSE REFERENDUM.] The reverse referendum 40.2 procedure in this subdivision applies only in the case of a 40.3 county, or a city that has a population of more than 1,000, that 40.4 has adopted a property tax levy increase over the levy amount 40.5 certified under section 275.07, subdivision 1, for the previous 40.6 year. 40.7 If within 21 days after the public hearing and adoption of 40.8 a levy under subdivision 6, a petition signed by voters equal in 40.9 number to five percent of the votes cast in the county or city 40.10 in the last general election requesting a referendum on the levy 40.11 increase is filed with the county auditor, or the city clerk, 40.12 the levy increase shall not be effective until it has been 40.13 submitted to the voters at a special election to be held on the 40.14 third Tuesday in January, and a majority of votes cast on the 40.15 question of approving the levy increase are in the affirmative. 40.16 The commissioner of revenue shall prepare the form of the 40.17 question to be presented at the referendum, which shall 40.18 reference only the amount of the property tax levy increase over 40.19 the previous year. 40.20 The county or city shall notify the county auditor of the 40.21 results of the referendum. If the majority of the votes cast on 40.22 the question are in the affirmative, the levy adopted under 40.23 subdivision 6 shall be certified to the county auditor under 40.24 section 275.07, subdivision 1. If the majority of the votes 40.25 cast on the question are in the negative, an amount equal to the 40.26 preceding year's levy shall be certified to the county auditor 40.27 for purposes of section 275.07, subdivision 1. 40.28 This subdivision does not apply to any levy that has been 40.29 approved by the voters under section 275.0646. 40.30 Sec. 8. Minnesota Statutes 1996, section 275.07, 40.31 subdivision 1, is amended to read: 40.32 Subdivision 1. Except as otherwise provided in this 40.33 subdivision, the taxes voted by cities, counties, school 40.34 districts, and special districts shall be certified by the 40.35 proper authorities to the county auditor on or before five 40.36 working days after December 20 in each year. A county or city 41.1 to which the reverse referendum provisions under section 41.2 275.065, subdivision 9, apply shall certify the taxes to the 41.3 county auditor by January 5, except that any county or city for 41.4 which a petition has been filed under section 275.065, 41.5 subdivision 9, must certify by the third Wednesday in January. 41.6 A town must certify the levy adopted by the town board to the 41.7 county auditor by September 15 each year. If the town board 41.8 modifies the levy at a special town meeting after September 15, 41.9 the town board must recertify its levy to the county auditor on 41.10 or before five working days after December 20. The taxes 41.11 certified shall not be reduced by the county auditor by the aid 41.12 received under section 273.1398, subdivision 2, but shall be 41.13 reduced by the county auditor by the aid received under section 41.14 273.1398, subdivision 3. If a city, town, county, school 41.15 district, or special district fails to certify its levy by that 41.16 date, its levy shall be the amount levied by it for the 41.17 preceding year. 41.18 Sec. 9. Minnesota Statutes 1996, section 276.04, 41.19 subdivision 2, is amended to read: 41.20 Subd. 2. [CONTENTS OF TAX STATEMENTS.] (a) The treasurer 41.21 shall provide for the printing of the tax statements. The 41.22 commissioner of revenue shall prescribe the form of the property 41.23 tax statement and its contents. The statement must contain a 41.24 tabulated statement of the dollar amount due to each taxing 41.25 authority and the state from the parcel of real property for 41.26 which a particular tax statement is prepared. The dollar 41.27 amounts due the county, state general education tax, the school 41.28 district, township or municipality, the total of the 41.29 metropolitan special taxing districts as defined in section 41.30 275.065, subdivision 3, paragraph (i),school district excess41.31referenda levy, remaining school district levy, and the total of41.32other voter approved referenda levies based on market value41.33under section 275.61must be separately stated. The amounts due 41.34 all other special taxing districts, if any, may be 41.35 aggregated.For the purposes of this subdivision, "school41.36district excess referenda levy" means school district taxes for42.1operating purposes approved at referenda, including those taxes42.2based on net tax capacity as well as those based on market42.3value. "School district excess referenda levy" does not include42.4school district taxes for capital expenditures approved at42.5referendums or school district taxes to pay for the debt service42.6on bonds approved at referenda.The amount of the tax on 42.7 contamination value imposed under sections 270.91 to 270.98, if 42.8 any, must also be separately stated. The dollar amounts, 42.9 including the dollar amount of any special assessments, may be 42.10 rounded to the nearest even whole dollar. For purposes of this 42.11 section whole odd-numbered dollars may be adjusted to the next 42.12 higher even-numbered dollar. The amount of market value 42.13 excluded under section 273.11, subdivision 16, if any, must also 42.14 be listed on the tax statement.The statement shall include the42.15following sentence, printed in upper case letters in boldface42.16print: "THE STATE OF MINNESOTA DOES NOT RECEIVE ANY PROPERTY42.17TAX REVENUES. THE STATE OF MINNESOTA REDUCES YOUR PROPERTY TAX42.18BY PAYING CREDITS AND REIMBURSEMENTS TO LOCAL UNITS OF42.19GOVERNMENT."42.20 (b) The property tax statements for manufactured homes and 42.21 sectional structures taxed as personal property shall contain 42.22 the same information that is required on the tax statements for 42.23 real property. 42.24 (c) Real and personal property tax statements must contain 42.25 the following information in the order given in this paragraph. 42.26 The information must contain the current year tax information in 42.27 the right column with the corresponding information for the 42.28 previous year in a column on the left: 42.29 (1) the property's estimated market value under section 42.30 273.11, subdivision 1; 42.31 (2) the property's taxable market value after reductions 42.32 under section 273.11, subdivisions 1a and 16; 42.33 (3) the property's gross tax, calculated by multiplying the 42.34 property's gross tax capacity times the total local tax rate and 42.35 adding to the result the sum of the aids enumerated inclause42.36 clauses (4) and (5); 43.1 (4) a total of the following aids: 43.2 (i) education aids payable under chapters 124 and 124A; and 43.3 (ii) local government aids for cities, towns, and counties 43.4 under chapter 477A; and 43.5 (iii) disparity reduction aid under section 273.1398; 43.6 (5) for homestead residential and agricultural properties, 43.7 the homestead and agricultural credit aid apportioned to the 43.8 property. This amount is obtained by multiplying the total 43.9 local tax rate by the difference between the property's gross 43.10 and net tax capacities under section 273.13. This amount must 43.11 be separately stated and identified as "homestead and 43.12 agricultural credit."For purposes of comparison with the43.13previous year's amount for the statement for taxes payable in43.141990, the statement must show the homestead credit for taxes43.15payable in 1989 under section 273.13, and the agricultural43.16credit under section 273.132 for taxes payable in 1989;43.17 (6) any credits received under sections 273.119; 273.123; 43.18 273.135; 273.1382; 273.1391; 273.1398, subdivision 4; 469.171; 43.19 and 473H.10, except that the amount of credit received under 43.20 section 273.135 must be separately stated and identified as 43.21 "taconite tax relief," and the amount of credit received under 43.22 section 273.1382 must be separately stated and identified as 43.23 general education homestead credit"; and 43.24 (7) the net tax payable in the manner required in paragraph 43.25 (a). 43.26 (d) If the county uses envelopes for mailing property tax 43.27 statements and if the county agrees, a taxing district may 43.28 include a notice with the property tax statement notifying 43.29 taxpayers when the taxing district will begin its budget 43.30 deliberations for the current year, and encouraging taxpayers to 43.31 attend the hearings. If the county allows notices to be 43.32 included in the envelope containing the property tax statement, 43.33 and if more than one taxing district relative to a given 43.34 property decides to include a notice with the tax statement, the 43.35 county treasurer or auditor must coordinate the process and may 43.36 combine the information on a single announcement. 44.1 The commissioner of revenue shall certify to the county 44.2 auditor the actual or estimated aids enumerated in paragraph 44.3 (c), clauses(3) and(4) and (5), that local governments will 44.4 receive in the following year.In the case of a county44.5containing a city of the first class, for taxes levied in 1991,44.6and for all counties for taxes levied in 1992 and thereafter,44.7 The commissioner must certify this amount by September 1 of each 44.8 year. 44.9 Sec. 10. [EFFECTIVE DATE.] 44.10 Section 1 is effective for reports and notices beginning in 44.11 1998 and thereafter. 44.12 Sections 2 to 6 are effective for notices, publications, 44.13 and hearings prepared, issued, or conducted in 1997 and 44.14 thereafter. 44.15 Sections 7 and 8 are effective for taxes levied in 1997, 44.16 payable in 1998, and thereafter. 44.17 Section 9 is effective for property tax statements issued 44.18 in 1998 and thereafter. 44.19 ARTICLE 4 44.20 LEVY CONSTRAINTS 44.21 Section 1. [275.0645] [LEVY CONSTRAINTS; DEFINITIONS.] 44.22 Subdivision 1. [APPLICATION.] For the purposes of section 44.23 275.0646, the following terms have the meanings given them in 44.24 this section. 44.25 Subd. 2. [IMPLICIT PRICE DEFLATOR.] "Implicit price 44.26 deflator" means the implicit price deflator for government 44.27 purchases of goods and services for state and local governments 44.28 prepared by the Bureau of Economic Analysis of the United States 44.29 Department of Commerce for the 12-month period ending March 31 44.30 of the levy year. 44.31 Subd. 3. [NUMBER OF HOUSEHOLDS.] "Number of households" 44.32 means the number of households for the taxing authority as 44.33 established by the last federal census, by a census taken under 44.34 section 275.14, or by an estimate made by the metropolitan 44.35 council, or by the state demographer under section 4A.02, 44.36 whichever is most recent as to the stated date of the count or 45.1 estimate up to and including July 1 of the current levy year. 45.2 Subd. 4. [TAXING AUTHORITY.] "Taxing authority" means a 45.3 county, a statutory or home rule charter city, or a metropolitan 45.4 special taxing district. 45.5 Sec. 2. [275.0646] [LEVY CONSTRAINTS; COMPLIANCE.] 45.6 Subdivision 1. [LEVY LIMIT BASE.] The levy limit base for 45.7 a taxing authority for taxes levied in the current year is equal 45.8 to the sum of: 45.9 (1) the taxing authority's final certified levy in the 45.10 prior year, for all purposes including bonded indebtedness; 45.11 (2) the amount of aids the taxing authority received in the 45.12 prior calendar year under sections 477A.011 to 477A.03, before 45.13 any reductions for state tax increment financing aid under 45.14 section 273.1399, subdivision 5; 45.15 (3) the amount of homestead and agricultural credit aid the 45.16 taxing authority received in the prior calendar year under 45.17 section 273.1398, before any reductions for tax increment 45.18 financing aid under section 273.1399, subdivision 5; 45.19 (4) the amount of local performance aid the taxing 45.20 authority received in the prior calendar year under section 45.21 477A.05; and 45.22 (5) the amount of any payments to the taxing authority in 45.23 the prior calendar year under sections 298.28 and 298.282. 45.24 Subd. 2. [LEVY CONSTRAINTS.] For taxes payable in 1998 and 45.25 thereafter, the levy limitation for each taxing authority is the 45.26 authority's levy limit base multiplied by one plus the sum of 45.27 (i) one percent less than the percentage rate of increase, but 45.28 not below zero, in the implicit price deflator, and (ii) the 45.29 percentage rate of increase, if any, in the number of households 45.30 for the most recent 12-month period for which data is available, 45.31 and reduced by the sum of (a) the total amount of aids that the 45.32 taxing authority is certified to receive under sections 477A.011 45.33 to 477A.014, (b) homestead and agricultural aids it is certified 45.34 to receive under section 273.1398, (c) local performance aid it 45.35 is certified to receive under section 477A.05, and (d) taconite 45.36 aids under sections 298.28 and 298.282, including any aid which 46.1 was required to be placed in a special fund for expenditure in 46.2 the next succeeding year. 46.3 Subd. 3. [CERTIFICATION BY COMMISSIONER.] On or before 46.4 August 1 of each year, the commissioner of revenue shall certify 46.5 the specific levy limitation to each taxing authority for 46.6 property taxes payable in the following year. The certification 46.7 shall also notify each recipient taxing authority that a 46.8 referendum must be held if the taxing authority's property tax 46.9 levy for the following taxes payable year will exceed the 46.10 certified levy limitation amount. 46.11 Subd. 4. [EXCESS LEVY REFERENDUM.] Each taxing authority 46.12 which intends to increase its property tax levy for taxes 46.13 payable in the following year by an amount which exceeds the 46.14 levy limitation certified to it under subdivision 3 for taxes 46.15 payable in the following year, must conduct a referendum on that 46.16 question on the first Tuesday after the first Monday in November 46.17 of the year preceding the year in which the property taxes are 46.18 payable. Approval of the excess levy by the voters is effective 46.19 for the following taxes payable year only, unless the question 46.20 on the ballot is for the approval of a bond issue, or unless the 46.21 question on the ballot specifies the additional years in which 46.22 the excess levy will be allowed. A voter approved excess levy 46.23 for a particular taxes payable year is not included in the 46.24 computation of the taxing authority's levy limitation under 46.25 subdivision 2 for a subsequent taxes payable year. 46.26 Sec. 3. Minnesota Statutes 1996, section 275.065, 46.27 subdivision 1, is amended to read: 46.28 Subdivision 1. [PROPOSED LEVY.] (a) Notwithstanding any 46.29 law or charter to the contrary, on or before September 15, each 46.30 taxing authority, other than a school district, shall adopt a 46.31 proposed budget and shall certify to the county auditor the 46.32 proposed or, in the case of a town, the final property tax levy 46.33 for taxes payable in the following year. 46.34 (b) On or before September 30, each school district shall 46.35 certify to the county auditor the proposed property tax levy for 46.36 taxes payable in the following year. The school district may 47.1 certify the proposed levy as: 47.2 (1) a specific dollar amount; or 47.3 (2) an amount equal to the maximum levy limitation 47.4 certified by the commissioner of children, families, and 47.5 learning to the county auditor according to section 124.918, 47.6 subdivision 1. 47.7 (c) If the board of estimate and taxation or any similar 47.8 board that establishes maximum tax levies for taxing 47.9 jurisdictions within a first class city certifies the maximum 47.10 property tax levies for funds under its jurisdiction by charter 47.11 to the county auditor by September 15, the city shall be deemed 47.12 to have certified its levies for those taxing jurisdictions. 47.13 (d) For purposes of this section, "taxing authority" 47.14 includes all home rule and statutory cities, towns, counties, 47.15 school districts, and special taxing districts as defined in 47.16 section 275.066. Intermediate school districts that levy a tax 47.17 under chapter 124 or 136D, joint powers boards established under 47.18 sections 124.491 to 124.495, and common school districts No. 47.19 323, Franconia, and No. 815, Prinsburg, are also special taxing 47.20 districts for purposes of this section. 47.21 (e) Any county, city, or metropolitan special taxing 47.22 district that will be holding a referendum under section 47.23 275.0646, on an increase in its levy above the levy limitation 47.24 established in that section, must include the amount of the 47.25 proposed excess levy in the proposed total levy certified under 47.26 this subdivision. 47.27 Sec. 4. Minnesota Statutes 1996, section 275.07, is 47.28 amended by adding a subdivision to read: 47.29 Subd. 5. [LEVY REDUCTION.] If a county, city, or 47.30 metropolitan special taxing district certifies a levy under 47.31 subdivision 1 that would exceed the levy limitation certified to 47.32 that taxing authority by the commissioner of revenue under 47.33 section 275.0646, subdivision 3, for the taxes payable year, and 47.34 if the excess levy was not approved by the voters at a 47.35 referendum held on the first Tuesday after the first Monday in 47.36 November preceding the levy certification date under subdivision 48.1 1, the county auditor will reduce the amount of the final 48.2 certified levy so that it does not exceed that taxing 48.3 authority's levy limitation, as certified by the commissioner. 48.4 Sec. 5. [EFFECTIVE DATE.] 48.5 Sections 1 to 4 are effective for property taxes levied in 48.6 1997, payable in 1998, and thereafter.