HF 2179

as introduced - 79th Legislature (1995 - 1996) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to taxation; allowing an exclusion from 
  1.3             estimated market value for certain improvements to 
  1.4             homestead property; amending Minnesota Statutes 1994, 
  1.5             sections 273.032; 273.11, by adding a subdivision; 
  1.6             273.121; and 276.04, subdivision 2. 
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  Minnesota Statutes 1994, section 273.032, is 
  1.9   amended to read: 
  1.10     273.032 [MARKET VALUE DEFINITION.] 
  1.11     For the purpose of determining any property tax levy 
  1.12  limitation based on market value, any net debt limit based on 
  1.13  market value, any limit on the issuance of bonds, certificates 
  1.14  of indebtedness, or capital notes based on market value, any 
  1.15  qualification to receive state aid based on market value, or any 
  1.16  state aid amount based on market value, the terms "market 
  1.17  value," "taxable market value," and "market valuation," whether 
  1.18  equalized or unequalized, mean the total taxable market value of 
  1.19  property within the local unit of government before any 
  1.20  adjustments for tax increment, fiscal disparity, or powerline 
  1.21  credit values, but after the limited market adjustments under 
  1.22  section 273.11, subdivision 1a, and after the market value 
  1.23  exclusions of certain improvements to homestead property under 
  1.24  section 273.11, subdivision subdivisions 16 and 19.  Unless 
  1.25  otherwise provided, "market value," "taxable market value," and 
  1.26  "market valuation" refer to the taxable market value for the 
  2.1   previous assessment year. 
  2.2      Sec. 2.  Minnesota Statutes 1994, section 273.11, is 
  2.3   amended by adding a subdivision to read: 
  2.4      Subd. 19.  [VALUATION EXCLUSION FOR CERTAIN IMPROVEMENTS.] 
  2.5   Improvements to homestead property shall be fully or partially 
  2.6   excluded from the value of the property for assessment purposes 
  2.7   provided that they meet the requirements of this section.  To be 
  2.8   eligible for exclusion under this subdivision, any improvement 
  2.9   must add at least $1,000 to the value of the property as 
  2.10  determined by the assessor.  Only improvements to the structure 
  2.11  which is the residence of the qualifying homesteader or 
  2.12  construction of or improvements to no more than one two-car 
  2.13  garage per residence qualify for the provisions of this 
  2.14  subdivision.  In the case of an owner-occupied duplex or 
  2.15  triplex, the improvement is eligible regardless of which portion 
  2.16  of the property was improved. 
  2.17     If the property lies in a jurisdiction which is subject to 
  2.18  a building permit process, a building permit must have been 
  2.19  issued prior to commencement of the improvement.  Whenever a 
  2.20  building permit is issued for property currently classified as 
  2.21  homestead, the issuing jurisdiction shall notify the property 
  2.22  owner of the possibility of valuation exclusion under this 
  2.23  subdivision.  
  2.24     The assessor shall require an application.  The 
  2.25  commissioner of revenue shall prescribe the form of the 
  2.26  application.  The application may be filed subsequent to the 
  2.27  date of the building permit provided that the application is 
  2.28  filed prior to the next assessment date. 
  2.29     No exclusion may be granted for an improvement by a local 
  2.30  board of review or county board of equalization unless (1) a 
  2.31  building permit was issued prior to the commencement of the 
  2.32  improvement if the jurisdiction requires a building permit, and 
  2.33  (2) an application was completed on a timely basis.  No 
  2.34  abatement of the taxes for qualifying improvements may be 
  2.35  granted by a county board unless (1) a building permit was 
  2.36  issued prior to commencement of the improvement if the 
  3.1   jurisdiction requires a building permit, and (2) an application 
  3.2   was completed on a timely basis. 
  3.3      The assessor shall note the qualifying value of each 
  3.4   improvement on the property's record, and the sum of those 
  3.5   amounts shall be subtracted from the value of the property in 
  3.6   each year for three years after the improvement has been made, 
  3.7   at which time an amount equal to the qualifying value shall be 
  3.8   added back.  The valuation exclusion shall terminate whenever (1)
  3.9   the property is sold, or (2) the property is reclassified to a 
  3.10  class which does not qualify for treatment under this 
  3.11  subdivision. Improvements made by an occupant who is the 
  3.12  purchaser of the property under a conditional purchase contract 
  3.13  do not qualify under this subdivision unless the seller of the 
  3.14  property is a governmental entity.  The qualifying value of the 
  3.15  property shall be computed based upon the increase from that 
  3.16  structure's market value as of January 2 preceding the 
  3.17  acquisition of the property by the governmental entity. 
  3.18     The total qualifying value for a homestead may not exceed 
  3.19  $10,000.  The term "qualifying value" means the increase in 
  3.20  estimated market value resulting from the improvement.  The 
  3.21  $10,000 maximum qualifying value under this subdivision may 
  3.22  result from up to three separate improvements to the homestead.  
  3.23  The application shall state, in clear language, that if more 
  3.24  than three improvements are made to the qualifying property, a 
  3.25  taxpayer may choose which three improvements are eligible, 
  3.26  provided that after the taxpayer has made the choice and any 
  3.27  valuation attributable to those improvements has been excluded 
  3.28  from taxation, no further changes can be made by the taxpayer. 
  3.29     If 50 percent or more of the square footage of a structure 
  3.30  is voluntarily razed or removed, the valuation increase 
  3.31  attributable to any subsequent improvements to the remaining 
  3.32  structure does not qualify for the exclusion under this 
  3.33  subdivision.  If a structure is unintentionally or accidentally 
  3.34  destroyed by a natural disaster, the property is eligible for an 
  3.35  exclusion under this subdivision provided that the structure was 
  3.36  not completely destroyed.  The qualifying value on property 
  4.1   destroyed by a natural disaster shall be computed based upon the 
  4.2   increase from that structure's market value as determined on 
  4.3   January 2 of the year in which the disaster occurred.  A 
  4.4   property receiving benefits under the homestead disaster 
  4.5   provisions under section 273.123 is not disqualified from 
  4.6   receiving an exclusion under this subdivision.  If any 
  4.7   combination of improvements made to a structure increases the 
  4.8   size of the structure by 100 percent or more, the valuation 
  4.9   increase attributable to the portion of the improvement that 
  4.10  causes the structure's size to exceed 100 percent does not 
  4.11  qualify for exclusion under this subdivision.  
  4.12     A property owner may not receive an exclusion under this 
  4.13  subdivision if the property is receiving an exclusion under the 
  4.14  provisions of subdivision 16. 
  4.15     Sec. 3.  Minnesota Statutes 1994, section 273.121, is 
  4.16  amended to read: 
  4.17     273.121 [VALUATION OF REAL PROPERTY, NOTICE.] 
  4.18     Any county assessor or city assessor having the powers of a 
  4.19  county assessor, valuing or classifying taxable real property 
  4.20  shall in each year notify those persons whose property is to be 
  4.21  assessed or reclassified that year if the person's address is 
  4.22  known to the assessor, otherwise the occupant of the property.  
  4.23  The notice shall be in writing and shall be sent by ordinary 
  4.24  mail at least ten days before the meeting of the local board of 
  4.25  review or equalization.  It shall contain:  (1) the market 
  4.26  value, (2) the limited market value under section 273.11, 
  4.27  subdivision 1a, (3) the qualifying amount of any improvements 
  4.28  under section 273.11, subdivision subdivisions 16 and 19, (4) 
  4.29  the market value subject to taxation after subtracting the 
  4.30  amount of any qualifying improvements, (5) the new 
  4.31  classification, (6) the assessor's office address, and (7) the 
  4.32  dates, places, and times set for the meetings of the local board 
  4.33  of review or equalization and the county board of equalization.  
  4.34  If the assessment roll is not complete, the notice shall be sent 
  4.35  by ordinary mail at least ten days prior to the date on which 
  4.36  the board of review has adjourned.  The assessor shall attach to 
  5.1   the assessment roll a statement that the notices required by 
  5.2   this section have been mailed.  Any assessor who is not provided 
  5.3   sufficient funds from the assessor's governing body to provide 
  5.4   such notices, may make application to the commissioner of 
  5.5   revenue to finance such notices.  The commissioner of revenue 
  5.6   shall conduct an investigation and, if satisfied that the 
  5.7   assessor does not have the necessary funds, issue a 
  5.8   certification to the commissioner of finance of the amount 
  5.9   necessary to provide such notices.  The commissioner of finance 
  5.10  shall issue a warrant for such amount and shall deduct such 
  5.11  amount from any state payment to such county or municipality.  
  5.12  The necessary funds to make such payments are hereby 
  5.13  appropriated.  Failure to receive the notice shall in no way 
  5.14  affect the validity of the assessment, the resulting tax, the 
  5.15  procedures of any board of review or equalization, or the 
  5.16  enforcement of delinquent taxes by statutory means. 
  5.17     Sec. 4.  Minnesota Statutes 1994, section 276.04, 
  5.18  subdivision 2, is amended to read: 
  5.19     Subd. 2.  [CONTENTS OF TAX STATEMENTS.] (a) The treasurer 
  5.20  shall provide for the printing of the tax statements.  The 
  5.21  commissioner of revenue shall prescribe the form of the property 
  5.22  tax statement and its contents.  The statement must contain a 
  5.23  tabulated statement of the dollar amount due to each taxing 
  5.24  authority from the parcel of real property for which a 
  5.25  particular tax statement is prepared.  The dollar amounts due 
  5.26  the county, township or municipality, the total of the 
  5.27  metropolitan special taxing districts as defined in section 
  5.28  275.065, subdivision 3, paragraph (i), school district excess 
  5.29  referenda levy, remaining school district levy, and the total of 
  5.30  other voter approved referenda levies based on market value 
  5.31  under section 275.61 must be separately stated.  The amounts due 
  5.32  all other special taxing districts, if any, may be aggregated.  
  5.33  For the purposes of this subdivision, "school district excess 
  5.34  referenda levy" means school district taxes for operating 
  5.35  purposes approved at referenda, including those taxes based on 
  5.36  market value.  "School district excess referenda levy" does not 
  6.1   include school district taxes for capital expenditures approved 
  6.2   at referendums or school district taxes to pay for the debt 
  6.3   service on bonds approved at referenda.  The amount of the tax 
  6.4   on contamination value imposed under sections 270.91 to 270.98, 
  6.5   if any, must also be separately stated.  The dollar amounts, 
  6.6   including the dollar amount of any special assessments, may be 
  6.7   rounded to the nearest even whole dollar.  For purposes of this 
  6.8   section whole odd-numbered dollars may be adjusted to the next 
  6.9   higher even-numbered dollar.  The amount of market value 
  6.10  excluded under section 273.11, subdivision subdivisions 16 and 
  6.11  19, if any, must also be listed on the tax statement.  The 
  6.12  statement shall include the following sentence, printed in upper 
  6.13  case letters in boldface print:  "THE STATE OF MINNESOTA DOES 
  6.14  NOT RECEIVE ANY PROPERTY TAX REVENUES.  THE STATE OF MINNESOTA 
  6.15  REDUCES YOUR PROPERTY TAX BY PAYING CREDITS AND REIMBURSEMENTS 
  6.16  TO LOCAL UNITS OF GOVERNMENT."  
  6.17     (b) The property tax statements for manufactured homes and 
  6.18  sectional structures taxed as personal property shall contain 
  6.19  the same information that is required on the tax statements for 
  6.20  real property.  
  6.21     (c) Real and personal property tax statements must contain 
  6.22  the following information in the order given in this paragraph.  
  6.23  The information must contain the current year tax information in 
  6.24  the right column with the corresponding information for the 
  6.25  previous year in a column on the left: 
  6.26     (1) the property's estimated market value under section 
  6.27  273.11, subdivision 1; 
  6.28     (2) the property's taxable market value after reductions 
  6.29  under section 273.11, subdivisions 1a and, 16, and 19; 
  6.30     (3) the property's gross tax, calculated by multiplying the 
  6.31  property's gross tax capacity times the total local tax rate and 
  6.32  adding to the result the sum of the aids enumerated in clause 
  6.33  (3); 
  6.34     (4) a total of the following aids: 
  6.35     (i) education aids payable under chapters 124 and 124A; 
  6.36     (ii) local government aids for cities, towns, and counties 
  7.1   under chapter 477A; and 
  7.2      (iii) disparity reduction aid under section 273.1398; 
  7.3      (5) for homestead residential and agricultural properties, 
  7.4   the homestead and agricultural credit aid apportioned to the 
  7.5   property.  This amount is obtained by multiplying the total 
  7.6   local tax rate by the difference between the property's gross 
  7.7   and net tax capacities under section 273.13.  This amount must 
  7.8   be separately stated and identified as "homestead and 
  7.9   agricultural credit."  For purposes of comparison with the 
  7.10  previous year's amount for the statement for taxes payable in 
  7.11  1990, the statement must show the homestead credit for taxes 
  7.12  payable in 1989 under section 273.13, and the agricultural 
  7.13  credit under section 273.132 for taxes payable in 1989; 
  7.14     (6) any credits received under sections 273.119; 273.123; 
  7.15  273.135; 273.1391; 273.1398, subdivision 4; 469.171; and 
  7.16  473H.10, except that the amount of credit received under section 
  7.17  273.135 must be separately stated and identified as "taconite 
  7.18  tax relief"; and 
  7.19     (7) the net tax payable in the manner required in paragraph 
  7.20  (a).  
  7.21     The commissioner of revenue shall certify to the county 
  7.22  auditor the actual or estimated aids enumerated in clauses (3) 
  7.23  and (4) that local governments will receive in the following 
  7.24  year.  In the case of a county containing a city of the first 
  7.25  class, for taxes levied in 1991, and for all counties for taxes 
  7.26  levied in 1992 and thereafter, the commissioner must certify 
  7.27  this amount by September 1.  
  7.28     Sec. 5.  [EFFECTIVE DATE.] 
  7.29     Sections 1 to 4 are effective for improvements made after 
  7.30  January 2, 1995.