HF 2069

as introduced - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am

A bill for an act
relating to taxation; increasing education funding;
eliminating the dedication of a portion of motor
vehicle sales tax proceeds to transit; authorizing a
property tax levy for transit; appropriating money;
amending Minnesota Statutes 2004, sections 126C.10, by
adding a subdivision; 174.24, subdivision 3b; 297B.09,
subdivision 1; 473.388, subdivisions 4, 7; 473.446,
subdivision 1, by adding subdivisions.

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

Section 1.

Minnesota Statutes 2004, section 126C.10, is
amended by adding a subdivision to read:

new text begin Subd. 2b. new text end

new text begin Additional basic revenue. new text end

new text begin For fiscal year
2006, the formula allowance in subdivision 2 is increased by
$70. For fiscal year 2007 and subsequent years, the formula
allowance in subdivision 2 is increased by $140.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for revenue
beginning in fiscal year 2006.
new text end

Sec. 2.

Minnesota Statutes 2004, section 174.24,
subdivision 3b, is amended to read:

Subd. 3b.

Operating assistance; recipient
classifications.

(a) The commissioner shall determine the total
operating cost of any public transit system receiving or
applying for assistance in accordance with generally accepted
accounting principles. To be eligible for financial assistance,
an applicant or recipient shall provide to the commissioner all
financial records and other information and shall permit any
inspection reasonably necessary to determine total operating
cost and correspondingly the amount of assistance that may be
paid to the applicant or recipient. Where more than one county
or municipality contributes assistance to the operation of a
public transit system, the commissioner shall identify one as
lead agency for the purpose of receiving money under this
section.

(b) Prior to distributing operating assistance to eligible
recipients for any contract period, the commissioner shall place
all recipients into one of the following classifications:
urbanized area service, small urban area service, rural area
service, and elderly and handicapped service. The commissioner
shall distribute funds under this section so that the percentage
of total operating cost paid by any recipient from local sources
will not exceed the percentage for that recipient's
classification, except as provided in an undue hardship case.
The percentages must be: for urbanized area service deleted text begin and deleted text end new text begin , 44
percent; for new text end small urban area service, deleted text begin 20 deleted text end new text begin 65 new text end percent; for rural
area service, deleted text begin 15 deleted text end new text begin 33 new text end percent; and for elderly and handicapped
service, deleted text begin 15 deleted text end new text begin 19 new text end percent. The remainder of the total operating
cost will be paid from state funds less any assistance received
by the recipient from any federal source. For purposes of this
subdivision, "local sources" means all local sources of funds
and includes all operating revenue, tax levies, and
contributions from public funds, except that the commissioner
may exclude from the total assistance contract revenues derived
from operations the cost of which is excluded from the
computation of total operating cost. Total operating costs of
the Duluth Transit Authority or a successor agency does not
include costs related to the Superior, Wisconsin service
contract and the Independent School District No. 709 service
contract. For calendar years 2004 and 2005, to enable public
transit systems to meet the provisions of this section, the
commissioner may adjust payments of financial assistance to
recipients that were under a contract with the department on
January 1, 2003. Payments to such a recipient in calendar years
2004 and 2005 from the greater Minnesota transit fund may not be
less than the payment to the recipient from that fund in
calendar year 2003, except for reductions made necessary by
reductions in base funding for those years.

(c) If a recipient informs the commissioner in writing
after the establishment of these percentages but prior to the
distribution of financial assistance for any year that paying
its designated percentage of total operating cost from local
sources will cause undue hardship, the commissioner may reduce
the percentage to be paid from local sources by the recipient
and increase the percentage to be paid from local sources by one
or more other recipients inside or outside the classification.
However, the commissioner may not reduce or increase any
recipient's percentage under this paragraph for more than two
years successively. If for any year the funds appropriated to
the commissioner to carry out the purposes of this section are
insufficient to allow the commissioner to pay the state share of
total operating cost as provided in this paragraph, the
commissioner shall reduce the state share in each classification
to the extent necessary.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for grants in
2006 and thereafter.
new text end

Sec. 3.

Minnesota Statutes 2004, section 297B.09,
subdivision 1, is amended to read:

Subdivision 1.

Deposit of revenues.

(a) Money collected
and received under this chapter must be deposited as provided in
this subdivision.

(b) From July 1, 2002, to June 30, 2003, 32 percent of the
money collected and received must be deposited in the highway
user tax distribution fund, 20.5 percent must be deposited in
the metropolitan area transit fund under section 16A.88, and
1.25 percent must be deposited in the greater Minnesota transit
fund under section 16A.88. The remaining money must be
deposited in the general fund.

(c) From July 1, 2003, to deleted text begin June 30, 2007 deleted text end new text begin December 31, 2005 new text end ,
30 percent of the money collected and received must be deposited
in the highway user tax distribution fund, 21.5 percent must be
deposited in the metropolitan area transit fund under section
16A.88, 1.43 percent must be deposited in the greater Minnesota
transit fund under section 16A.88, 0.65 percent must be
deposited in the county state-aid highway fund, and 0.17 percent
must be deposited in the municipal state-aid street fund. The
remaining money must be deposited in the general fund.

(d) new text begin From January 1, 2006, to June 30, 2007, 30 percent of
the money collected and received must be deposited in the
highway user tax distribution fund, 0.65 percent must be
deposited in the county state aid highway fund, and 0.17 percent
must be deposited in the municipal state aid street fund. The
remaining money must be deposited in the general fund.
new text end

new text begin (e) new text end On and after July 1, 2007, 32 percent of the money
collected and received must be deposited in the highway user tax
distribution fund deleted text begin , 20.5 percent must be deposited in the
metropolitan area transit fund under section 16A.88, and 1.25
percent must be deposited in the greater Minnesota transit fund
under section 16A.88 deleted text end . The remaining money must be deposited in
the general fund.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for collections
after December 31, 2005.
new text end

Sec. 4.

Minnesota Statutes 2004, section 473.388,
subdivision 4, is amended to read:

Subd. 4.

Financial assistance.

(a) The council deleted text begin must deleted text end new text begin may
new text end grant the requested financial assistance if it determines that
the proposed service is intended to replace the service to the
applying city or town or combination thereof by the council and
that the proposed service will meet the needs of the applicant
at least as efficiently and effectively as the existing service.

(b) The amount of assistance which the council deleted text begin must deleted text end new text begin may
new text end provide to a system under this section may not deleted text begin be less than
deleted text end new text begin exceed new text end the sum of deleted text begin the amounts determined for each municipality
comprising the system as follows deleted text end :

(1) deleted text begin the transit operating assistance grants received under
this subdivision by the municipality in calendar year 2001 or
the tax revenues for transit services levied by the municipality
for taxes payable in 2001, including that portion of the levy
derived from the areawide pool under section 473F.08,
subdivision 3, clause (a), plus the portion of the
municipality's aid under section 273.1398, subdivision 2,
attributable to the transit levy; times
deleted text end

deleted text begin (2) the ratio of (i) the appropriation from the transit
fund to the council for nondebt transit operations for the
current fiscal year to (ii) the total levy certified by the
council under section 473.446 and the opt-out municipalities
under this section for taxes payable in 2001, including the
portion of homestead and agricultural credit aid under section
273.1398, subdivision 2, attributable to nondebt transit levies,
times
deleted text end

deleted text begin (3) the ratio of (i) the municipality's total taxable
market value for taxes payable in the most recent year for which
data is available divided by the municipality's total taxable
market value for taxes payable in 2001, to (ii) the total
taxable market value of all property in the metropolitan area
for taxes payable in the most recent year for which data is
available divided by the total taxable market value of all
property in the metropolitan area for taxes payable in 2001. deleted text end new text begin the
portion of the available local transit funds which the applicant
proposes to use to subsidize the proposed service; and
new text end

new text begin (2) an amount of financial assistance bearing an identical
proportional relationship to the amount under clause (1) as the
total amount of funds used by the council to fund its transit
operations bears to the total amount of taxes collected by the
council under section 473.446, subdivision 1, paragraph (a),
clause (2).
new text end

(c) The council shall pay the amount to be provided to the
recipient from the funds the council would otherwise use to fund
its transit operations.

new text begin (d) For purposes of this section, "available local transit
funds" means 90 percent of the tax revenues which would accrue
to the council from the tax it levies under section 473.446,
subdivision 1, paragraph (a), clause (2), in the applicant city
or town or combination thereof.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for 2006 and
thereafter.
new text end

Sec. 5.

Minnesota Statutes 2004, section 473.388,
subdivision 7, is amended to read:

Subd. 7.

Local levy option.

(a) A statutory or home rule
charter city or town that is eligible for assistance under this
section may levy a tax new text begin for payment of the operating and capital
expenditures for transit and other related activities and to
provide new text end for payment of obligations issued by the municipality
for deleted text begin capital expenditures for transit and other related
activities, provided that property taxes were pledged to satisfy
the obligations, and provided that legislative appropriations
are insufficient to satisfy the obligations deleted text end new text begin such purposes,
provided that the tax must be sufficient to maintain the level
of transit service provided in the municipality in the previous
year new text end .

(b) new text begin The transit tax revenues derived by the municipality
may not exceed 88 percent of the tax revenues that would be
raised by the council's levy under section 473.446, subdivision
1, paragraph (a), clause (2), within the municipality, including
the areawide portion of the levy under chapter 473F, if the
municipality were not eligible for treatment under this section.
new text end

new text begin The commissioner of revenue shall certify the
municipality's levy limitation under this subdivision to the
municipality by August 1 of the levy year. The tax must be
accumulated and kept in a separate fund to be known as the
"replacement transit fund."
new text end

new text begin (c) new text end This subdivision is consistent with the transit
redesign plan. Eligible municipalities opting to operate under
this subdivision shall continue to meet the regional performance
standards established by the council.

deleted text begin (c) deleted text end new text begin (d) new text end Within the designated Americans with Disabilities
Act area, metro mobility remains the obligation of the state.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxes
payable in 2006 and thereafter.
new text end

Sec. 6.

Minnesota Statutes 2004, section 473.446,
subdivision 1, is amended to read:

Subdivision 1.

Metropolitan area transit tax.

(a) For
the purposes of sections 473.405 to 473.449 and the metropolitan
transit system, except as otherwise provided in this
subdivision, the council shall levy each year upon all taxable
property within the metropolitan area, defined in section
473.121, subdivision 2, a transit tax consisting of:

(1) an amount necessary to provide full and timely payment
of certificates of indebtedness, bonds, including refunding
bonds or other obligations issued or to be issued under section
473.39 by the council for purposes of acquisition and betterment
of property and other improvements of a capital nature and to
which the council has specifically pledged tax levies under this
clause; and

(2) deleted text begin an additional amount necessary to provide full and
timely payment of certificates of indebtedness issued by the
council, after consultation with the commissioner of finance, if
revenues to the metropolitan area transit fund in the fiscal
year in which the indebtedness is issued increase over those
revenues in the previous fiscal year by a percentage less than
the percentage increase for the same period in the revised
Consumer Price Index for all urban consumers for the St.
Paul-Minneapolis metropolitan area prepared by the United States
Department of Labor deleted text end new text begin an amount which shall be used for payment of
the expenses of operating transit and paratransit services new text end .

(b) deleted text begin Indebtedness to which property taxes have been pledged
under paragraph (a), clause (2), that is incurred in any fiscal
year may not exceed the amount necessary to make up the
difference between (1) the amount that the council received or
expects to receive in that fiscal year from the metropolitan
area transit fund and (2) the amount the council received from
that fund in the previous fiscal year multiplied by the
percentage increase for the same period in the revised Consumer
Price Index for all urban consumers for the St. Paul-Minneapolis
metropolitan area prepared by the United States Department of
Labor. deleted text end new text begin The property tax levied by the council under paragraph
(a), clause (2), must not exceed the following amount for the
years specified:
new text end

new text begin (1) for taxes payable in 2006, the amount received by the
council and municipalities for that purpose from the
metropolitan area transit fund under section 16A.88, subdivision
2, in fiscal year 2005, adjusted for inflation, minus (i) any
amounts to be levied for taxes payable in 2006 under section
473.388, subdivision 7, and (ii) any amounts to be levied for
taxes payable in 2006 under subdivision 1c; and
new text end

new text begin (2) for taxes payable in 2007 and subsequent years, the
council's property tax levy limitation for the previous year
determined under this subdivision before reductions by any
amounts levied in the previous year under section 473.388,
subdivision 7, and subdivision 1c, adjusted for inflation, minus
any amounts to be levied in the current levy year under section
473.388, subdivision 7, and subdivision 1c.
new text end

new text begin (c) For the purposes of this subdivision, "adjusted for
inflation" means multiplied by the percentage increase in the
revised Consumer Price Index for all urban consumers in the St.
Paul-Minneapolis metropolitan area prepared by the United States
Department of Labor for the most recent 12-month period
available compared to the previous 12-month period.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxes
payable in 2006 and thereafter.
new text end

Sec. 7.

Minnesota Statutes 2004, section 473.446, is
amended by adding a subdivision to read:

new text begin Subd. 1c. new text end

new text begin Taxation within transit area. new text end

new text begin For the purposes
of sections 473.405 to 473.449, the council shall levy a transit
tax upon all taxable property within the metropolitan transit
area but outside of the metropolitan transit taxing district, as
defined in subdivision 2, at a rate equal to ten percent of the
rate within the transit district. The proceeds of this tax
shall be used only for paratransit services or ride sharing
programs designed to serve persons located within the transit
area but outside of the transit taxing district.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxes
payable in 2006 and thereafter.
new text end

Sec. 8.

Minnesota Statutes 2004, section 473.446, is
amended by adding a subdivision to read:

new text begin Subd. 1d. new text end

new text begin Levy within eligible municipalities. new text end

new text begin The
council's levy upon taxable property within a municipality
levying taxes under section 473.388, subdivision 7, is the tax
that would be levied within the municipality if it were not
levying under section 473.388, subdivision 7, minus the amount
to be levied by the municipality under section 473.388,
subdivision 7, for the current levy year.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxes
payable in 2006 and thereafter.
new text end