HF 2963

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; property; providing a class rate 
  1.3             for certain unimproved property bordering water; 
  1.4             amending Minnesota Statutes 1994, section 273.13, 
  1.5             subdivision 23; Minnesota Statutes 1995 Supplement, 
  1.6             section 273.1398, subdivision 1. 
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  Minnesota Statutes 1994, section 273.13, 
  1.9   subdivision 23, is amended to read: 
  1.10     Subd. 23.  [CLASS 2.] (a) Class 2a property is agricultural 
  1.11  land including any improvements that is homesteaded.  The market 
  1.12  value of the house and garage and immediately surrounding one 
  1.13  acre of land has the same class rates as class 1a property under 
  1.14  subdivision 22.  The value of the remaining land including 
  1.15  improvements up to $115,000 has a net class rate of .45 percent 
  1.16  of market value and a gross class rate of 1.75 percent of market 
  1.17  value.  The remaining value of class 2a property over $115,000 
  1.18  of market value that does not exceed 320 acres has a net class 
  1.19  rate of one percent of market value, and a gross class rate of 
  1.20  2.25 percent of market value.  The remaining property over the 
  1.21  $115,000 market value in excess of 320 acres has a class rate of 
  1.22  1.5 percent of market value, and a gross class rate of 2.25 
  1.23  percent of market value.  
  1.24     (b) Class 2b property is (1) real estate, rural in 
  1.25  character and used exclusively for growing trees for timber, 
  1.26  lumber, and wood and wood products; (2) real estate that is not 
  2.1   improved with a structure and is used exclusively for growing 
  2.2   trees for timber, lumber, and wood and wood products, if the 
  2.3   owner has participated or is participating in a cost-sharing 
  2.4   program for afforestation, reforestation, or timber stand 
  2.5   improvement on that particular property, administered or 
  2.6   coordinated by the commissioner of natural resources; (3) real 
  2.7   estate that is nonhomestead agricultural land; or (4) a landing 
  2.8   area or public access area of a privately owned public use 
  2.9   airport.  Class 2b property has a net class rate of 1.5 percent 
  2.10  of market value, and a gross class rate of 2.25 percent of 
  2.11  market value.  
  2.12     (c) Agricultural land as used in this section means 
  2.13  contiguous acreage of ten acres or more, primarily used during 
  2.14  the preceding year for agricultural purposes.  Agricultural use 
  2.15  may include pasture, timber, waste, unusable wild land, and land 
  2.16  included in state or federal farm programs.  "Agricultural 
  2.17  purposes" as used in this section means the raising or 
  2.18  cultivation of agricultural products.  
  2.19     (d) Real estate of less than ten acres used principally for 
  2.20  raising or cultivating agricultural products, shall be 
  2.21  considered as agricultural land, if it is not used primarily for 
  2.22  residential purposes.  
  2.23     (e) The term "agricultural products" as used in this 
  2.24  subdivision includes:  
  2.25     (1) livestock, dairy animals, dairy products, poultry and 
  2.26  poultry products, fur-bearing animals, horticultural and nursery 
  2.27  stock described in sections 18.44 to 18.61, fruit of all kinds, 
  2.28  vegetables, forage, grains, bees, and apiary products by the 
  2.29  owner; 
  2.30     (2) fish bred for sale and consumption if the fish breeding 
  2.31  occurs on land zoned for agricultural use; 
  2.32     (3) the commercial boarding of horses if the boarding is 
  2.33  done in conjunction with raising or cultivating agricultural 
  2.34  products as defined in clause (1); 
  2.35     (4) property which is owned and operated by nonprofit 
  2.36  organizations used for equestrian activities, excluding racing; 
  3.1   and 
  3.2      (5) game birds and waterfowl bred and raised for use on a 
  3.3   shooting preserve licensed under section 97A.115.  
  3.4      (f) If a parcel used for agricultural purposes is also used 
  3.5   for commercial or industrial purposes, including but not limited 
  3.6   to:  
  3.7      (1) wholesale and retail sales; 
  3.8      (2) processing of raw agricultural products or other goods; 
  3.9      (3) warehousing or storage of processed goods; and 
  3.10     (4) office facilities for the support of the activities 
  3.11  enumerated in clauses (1), (2), and (3), 
  3.12  the assessor shall classify the part of the parcel used for 
  3.13  agricultural purposes as class 1b, 2a, or 2b, whichever is 
  3.14  appropriate, and the remainder in the class appropriate to its 
  3.15  use.  The grading, sorting, and packaging of raw agricultural 
  3.16  products for first sale is considered an agricultural purpose.  
  3.17  A greenhouse or other building where horticultural or nursery 
  3.18  products are grown that is also used for the conduct of retail 
  3.19  sales must be classified as agricultural if it is primarily used 
  3.20  for the growing of horticultural or nursery products from seed, 
  3.21  cuttings, or roots and occasionally as a showroom for the retail 
  3.22  sale of those products.  Use of a greenhouse or building only 
  3.23  for the display of already grown horticultural or nursery 
  3.24  products does not qualify as an agricultural purpose.  
  3.25     The assessor shall determine and list separately on the 
  3.26  records the market value of the homestead dwelling and the one 
  3.27  acre of land on which that dwelling is located.  If any farm 
  3.28  buildings or structures are located on this homesteaded acre of 
  3.29  land, their market value shall not be included in this separate 
  3.30  determination.  
  3.31     (g) To qualify for classification under paragraph (b), 
  3.32  clause (4), a privately owned public use airport must be 
  3.33  licensed as a public airport under section 360.018.  For 
  3.34  purposes of paragraph (b), clause (4), "landing area" means that 
  3.35  part of a privately owned public use airport properly cleared, 
  3.36  regularly maintained, and made available to the public for use 
  4.1   by aircraft and includes runways, taxiways, aprons, and sites 
  4.2   upon which are situated landing or navigational aids.  A landing 
  4.3   area also includes land underlying both the primary surface and 
  4.4   the approach surfaces that comply with all of the following:  
  4.5      (i) the land is properly cleared and regularly maintained 
  4.6   for the primary purposes of the landing, taking off, and taxiing 
  4.7   of aircraft; but that portion of the land that contains 
  4.8   facilities for servicing, repair, or maintenance of aircraft is 
  4.9   not included as a landing area; 
  4.10     (ii) the land is part of the airport property; and 
  4.11     (iii) the land is not used for commercial or residential 
  4.12  purposes. 
  4.13  The land contained in a landing area under paragraph (b), clause 
  4.14  (4), must be described and certified by the commissioner of 
  4.15  transportation.  The certification is effective until it is 
  4.16  modified, or until the airport or landing area no longer meets 
  4.17  the requirements of paragraph (b), clause (4).  For purposes of 
  4.18  paragraph (b), clause (4), "public access area" means property 
  4.19  used as an aircraft parking ramp, apron, or storage hangar, or 
  4.20  an arrival and departure building in connection with the airport.
  4.21     (h) Class 2c property is unimproved real estate, not 
  4.22  including agricultural land, that:  (1) borders or is adjacent 
  4.23  to public waters as defined in section 103G.005, subdivision 15, 
  4.24  clauses (1) to (5), and (7) to (9); and (2) is located within 
  4.25  400 feet from the ordinary high water elevation of the public 
  4.26  waters; and (3) has been in possession of the owner, or the 
  4.27  owner's spouse, parent, or sibling, or combination thereof, for 
  4.28  a period of at least seven years prior to classification under 
  4.29  this section.  Class 2c property has a class rate of .5 percent 
  4.30  of market value.  
  4.31     Sec. 2.  Minnesota Statutes 1995 Supplement, section 
  4.32  273.1398, subdivision 1, is amended to read: 
  4.33     Subdivision 1.  [DEFINITIONS.] (a) In this section, the 
  4.34  terms defined in this subdivision have the meanings given them. 
  4.35     (b) "Unique taxing jurisdiction" means the geographic area 
  4.36  subject to the same set of local tax rates. 
  5.1      (c) "Net tax capacity" means the product of (i) the 
  5.2   appropriate net class rates for the year in which the aid is 
  5.3   payable, except that for aid payable in 1996 the class rate 
  5.4   applicable to all class 4a shall be 3.4 percent; and (ii) 
  5.5   estimated market values for the assessment two years prior to 
  5.6   that in which aid is payable.  The classification of class 2c 
  5.7   property must not be considered in determining net tax capacity 
  5.8   for purposes of this paragraph for aids payable in 1998.  "Total 
  5.9   net tax capacity" means the net tax capacities for all property 
  5.10  within the unique taxing jurisdiction.  The total net tax 
  5.11  capacity used shall be reduced by the sum of (1) the unique 
  5.12  taxing jurisdiction's net tax capacity of commercial industrial 
  5.13  property as defined in section 473F.02, subdivision 3, 
  5.14  multiplied by the ratio determined pursuant to section 473F.08, 
  5.15  subdivision 6, for the municipality, as defined in section 
  5.16  473F.02, subdivision 8, in which the unique taxing jurisdiction 
  5.17  is located, (2) the net tax capacity of the captured value of 
  5.18  tax increment financing districts as defined in section 469.177, 
  5.19  subdivision 2, and (3) the net tax capacity of transmission 
  5.20  lines deducted from a local government's total net tax capacity 
  5.21  under section 273.425.  For purposes of determining the net tax 
  5.22  capacity of property referred to in clauses (1), (2), and (3), 
  5.23  the net tax capacity shall be multiplied by the ratio of the 
  5.24  highest class rate for class 3a property for taxes payable in 
  5.25  the year in which the aid is payable to the highest class rate 
  5.26  for class 3a property in the prior year.  Net tax capacity 
  5.27  cannot be less than zero. 
  5.28     (d) "Previous net tax capacity" means the product of the 
  5.29  appropriate net class rates for the year previous to the year in 
  5.30  which the aid is payable, and estimated market values for the 
  5.31  assessment two years prior to that in which aid is payable.  
  5.32  "Total previous net tax capacity" means the previous net tax 
  5.33  capacities for all property within the unique taxing 
  5.34  jurisdiction.  The total previous net tax capacity shall be 
  5.35  reduced by the sum of (1) the unique taxing jurisdiction's 
  5.36  previous net tax capacity of commercial-industrial property as 
  6.1   defined in section 473F.02, subdivision 3, multiplied by the 
  6.2   ratio determined pursuant to section 473F.08, subdivision 6, for 
  6.3   the municipality, as defined in section 473F.02, subdivision 8, 
  6.4   in which the unique taxing jurisdiction is located, (2) the 
  6.5   previous net tax capacity of the captured value of tax increment 
  6.6   financing districts as defined in section 469.177, subdivision 
  6.7   2, and (3) the previous net tax capacity of transmission lines 
  6.8   deducted from a local government's total net tax capacity under 
  6.9   section 273.425.  Previous net tax capacity cannot be less than 
  6.10  zero. 
  6.11     (e) "Equalized market values" are market values that have 
  6.12  been equalized by dividing the assessor's estimated market value 
  6.13  for the second year prior to that in which the aid is payable by 
  6.14  the assessment sales ratios determined by class in the 
  6.15  assessment sales ratio study conducted by the department of 
  6.16  revenue pursuant to section 124.2131 in the second year prior to 
  6.17  that in which the aid is payable.  The equalized market values 
  6.18  shall equal the unequalized market values divided by the 
  6.19  assessment sales ratio. 
  6.20     (f) "Equalized school levies" means the amounts levied for: 
  6.21     (1) general education under section 124A.23, subdivision 2; 
  6.22     (2) supplemental revenue under section 124A.22, subdivision 
  6.23  8a; 
  6.24     (3) capital expenditure facilities revenue under section 
  6.25  124.243, subdivision 3; 
  6.26     (4) capital expenditure equipment revenue under section 
  6.27  124.244, subdivision 2; 
  6.28     (5) basic transportation under section 124.226, subdivision 
  6.29  1; and 
  6.30     (6) referendum revenue under section 124A.03. 
  6.31     (g) "Current local tax rate" means the quotient derived by 
  6.32  dividing the taxes levied within a unique taxing jurisdiction 
  6.33  for taxes payable in the year prior to that for which aids are 
  6.34  being calculated by the total previous net tax capacity of the 
  6.35  unique taxing jurisdiction.  
  6.36     (h) For purposes of calculating and allocating homestead 
  7.1   and agricultural credit aid authorized pursuant to subdivision 2 
  7.2   and the disparity reduction aid authorized in subdivision 3, 
  7.3   "gross taxes levied on all properties," "gross taxes," or "taxes 
  7.4   levied" means the total net tax capacity based taxes levied on 
  7.5   all properties except that levied on the captured value of tax 
  7.6   increment districts as defined in section 469.177, subdivision 
  7.7   2, and that levied on the portion of commercial industrial 
  7.8   properties' assessed value or gross tax capacity, as defined in 
  7.9   section 473F.02, subdivision 3, subject to the areawide tax as 
  7.10  provided in section 473F.08, subdivision 6, in a unique taxing 
  7.11  jurisdiction.  "Gross taxes" are before any reduction for 
  7.12  disparity reduction aid but "taxes levied" are after any 
  7.13  reduction for disparity reduction aid.  Gross taxes levied or 
  7.14  taxes levied cannot be less than zero.  
  7.15     "Taxes levied" excludes equalized school levies. 
  7.16     (i) "Human services aids" means: 
  7.17     (1) aid to families with dependent children under sections 
  7.18  256.82, subdivision 1, and 256.935, subdivision 1; 
  7.19     (2) medical assistance under sections 256B.041, subdivision 
  7.20  5, and 256B.19, subdivision 1; 
  7.21     (3) general assistance medical care under section 256D.03, 
  7.22  subdivision 6; 
  7.23     (4) general assistance under section 256D.03, subdivision 
  7.24  2; 
  7.25     (5) work readiness under section 256D.03, subdivision 2; 
  7.26     (6) emergency assistance under section 256.871, subdivision 
  7.27  6; 
  7.28     (7) Minnesota supplemental aid under section 256D.36, 
  7.29  subdivision 1; 
  7.30     (8) preadmission screening and alternative care grants; 
  7.31     (9) work readiness services under section 256D.051; 
  7.32     (10) case management services under section 256.736, 
  7.33  subdivision 13; 
  7.34     (11) general assistance claims processing, medical 
  7.35  transportation and related costs; and 
  7.36     (12) medical assistance, medical transportation and related 
  8.1   costs. 
  8.2      (j) "Household adjustment factor" means the number of 
  8.3   households for the second most recent year preceding that in 
  8.4   which the aids are payable divided by the number of households 
  8.5   for the third most recent year.  The household adjustment factor 
  8.6   cannot be less than one.  
  8.7      (k) "Growth adjustment factor" means the household 
  8.8   adjustment factor in the case of counties.  In the case of 
  8.9   cities, towns, school districts, and special taxing districts, 
  8.10  the growth adjustment factor equals one.  The growth adjustment 
  8.11  factor cannot be less than one.  
  8.12     (l) For aid payable in 1992 and subsequent years, 
  8.13  "homestead and agricultural credit base" means the previous 
  8.14  year's certified homestead and agricultural credit aid 
  8.15  determined under subdivision 2 less any permanent aid reduction 
  8.16  in the previous year to homestead and agricultural credit aid 
  8.17  under section 477A.0132, plus, for aid payable in 1992, fiscal 
  8.18  disparity homestead and agricultural credit aid under 
  8.19  subdivision 2b.  
  8.20     (m) "Net tax capacity adjustment" means (1) the total 
  8.21  previous net tax capacity minus the total net tax capacity, 
  8.22  multiplied by (2) the unique taxing jurisdiction's current local 
  8.23  tax rate.  The net tax capacity adjustment cannot be less than 
  8.24  zero. 
  8.25     (n) "Fiscal disparity adjustment" means the difference 
  8.26  between (1) a taxing jurisdiction's fiscal disparity 
  8.27  distribution levy under section 473F.08, subdivision 3, clause 
  8.28  (a), for taxes payable in the year prior to that for which aids 
  8.29  are being calculated, and (2) the same distribution levy 
  8.30  multiplied by the ratio of the highest class rate for class 3 
  8.31  property for taxes payable in the year prior to that for which 
  8.32  aids are being calculated to the highest class rate for class 3 
  8.33  property for taxes payable in the second prior year to that for 
  8.34  which aids are being calculated.  In the case of school 
  8.35  districts, the fiscal disparity distribution levy shall exclude 
  8.36  that part of the levy attributable to equalized school levies. 
  9.1      Sec. 3.  [EFFECTIVE DATE.] 
  9.2      Section 1 is effective for taxes levied in 1997, payable in 
  9.3   1998, and thereafter.  Section 2 is effective for aids payable 
  9.4   in 1998.