as introduced - 80th Legislature (1997 - 1998) Posted on 12/15/2009 12:00am
|Introduction||Posted on 02/12/1998|
1.1 A bill for an act 1.2 relating to taxation; providing a property tax rebate; 1.3 providing for property tax simplification and reform; 1.4 appropriating money; amending Minnesota Statutes 1996, 1.5 sections 124.95, subdivision 4; 477A.013, subdivision 1.6 9; and 477A.03, subdivision 2; Minnesota Statutes 1997 1.7 Supplement, sections 124.961; 273.127, subdivision 3; 1.8 273.13, subdivisions 24, 25, as amended, and 31; 1.9 273.1382, subdivision 1; and 477A.03, subdivision 3. 1.10 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 1.11 ARTICLE 1 1.12 PROPERTY TAX REBATE 1.13 Section 1. [1998 PROPERTY TAX REBATE.] 1.14 (a) A credit is allowed against the tax imposed under 1.15 Minnesota Statutes, chapter 290, to an individual, other than as 1.16 a dependent, as defined in sections 151 and 152 of the Internal 1.17 Revenue Code, disregarding section 152(b)(3) of the Internal 1.18 Revenue Code, equal to 20 percent of the qualified property tax 1.19 paid before January 1, 1999, for taxes assessed in 1997. 1.20 (b) For property owned and occupied by the taxpayer during 1.21 1998, qualified property tax means property taxes payable as 1.22 defined in Minnesota Statutes, section 290A.03, subdivision 13, 1.23 assessed in 1997 and payable in 1998, and deductible by the 1.24 individual under section 164 of the Internal Revenue Code of 1.25 1986, as amended through December 31, 1997, except the 1.26 requirement in Minnesota Statutes, section 290A.03, subdivision 1.27 13, that the taxpayer own and occupy the property on January 2, 2.1 1998, does not apply. 2.2 (c) For a renter, the qualified property tax means the 2.3 amount of rent constituting property taxes under Minnesota 2.4 Statutes, section 290A.03, subdivision 11, based on rent paid in 2.5 1998. If two or more renters could be claimants under Minnesota 2.6 Statutes, chapter 290A, with regard to the rent constituting 2.7 property taxes, the rules under Minnesota Statutes, section 2.8 290A.03, subdivision 8, paragraph (f), apply to determine the 2.9 amount of the credit for the individual. 2.10 (d) For an individual who both owned and rented principal 2.11 residences in calendar year 1998, qualified taxes are the sum of 2.12 the amounts under paragraphs (b) and (c). 2.13 (e) If the amount of the credit under this section exceeds 2.14 the taxpayer's tax liability under Minnesota Statutes, chapter 2.15 290, the commissioner shall refund the excess. 2.16 (f) To claim a credit under this section, the taxpayer must 2.17 attach a copy of the property tax statement and certificate of 2.18 rent paid, as applicable, and provide any additional information 2.19 the commissioner requires. 2.20 (g) This credit applies to taxable years beginning after 2.21 December 31, 1997, and before January 1, 1999. 2.22 (h) Payment of the credit under this section is subject to 2.23 Minnesota Statutes, chapter 270A, and any other provision 2.24 applicable to refunds under Minnesota Statutes, chapter 290. 2.25 (i) An amount sufficient to pay refunds under this section 2.26 is appropriated to the commissioner of revenue from the general 2.27 fund. 2.28 Sec. 2. [TRANSFER TO GENERAL FUND.] 2.29 Notwithstanding the provisions of Minnesota Statutes, 2.30 section 16A.1521, paragraph (b), $500,000,000 from the property 2.31 tax reform account is available to the general fund in an amount 2.32 equal to the rebates under section 1. This amount is available 2.33 beginning March 1, 1999, except as provided in section 3. 2.34 Sec. 3. [APPROPRIATION.] 2.35 Up to $1,800,000 of the amount available in section 2 is 2.36 appropriated from the general fund to the commissioner of 3.1 revenue to administer section 1. Of this amount, $1,000,000 is 3.2 available July 1, 1998. The remainder is available upon the 3.3 department of revenue's report of actual administrative 3.4 expenditures for the fiscal year 1998 rebate to the department 3.5 of finance. The report shall include updated estimates of 3.6 expected administrative expenditures for the fiscal year 1999 3.7 rebate. 3.8 ARTICLE 2 3.9 PROPERTY TAX REFORM 3.10 Section 1. Minnesota Statutes 1996, section 124.95, 3.11 subdivision 4, is amended to read: 3.12 Subd. 4. [EQUALIZED DEBT SERVICE LEVY.] To obtain debt 3.13 service equalization revenue, a district must levy an amount not 3.14 to exceed the district's debt service equalization revenue times 3.15 the lesser of one or the ratio of: 3.16 (1) the quotient derived by dividing the adjusted net tax 3.17 capacity of the district for the year before the year the levy 3.18 is certified by the actual pupil units in the district for the 3.19 school year ending in the year prior to the year the levy is 3.20 certified; to 3.21 (2)
$4,707.50$10,000. 3.22 Sec. 2. Minnesota Statutes 1997 Supplement, section 3.23 124.961, is amended to read: 3.24 124.961 [DEBT SERVICE APPROPRIATION.] 3.25 (a) $35,480,000 in fiscal year 1998,$38,159,000 in fiscal 3.26 year 1999, and $38,390,000$59,642,000 in fiscal year 2000, and 3.27 $62,000,000 in fiscal year 2001 and each year thereafter is 3.28 appropriated from the general fund to the commissioner of 3.29 children, families, and learning for payment of debt service 3.30 equalization aid under section 124.95. The 2000 appropriation 3.31 includes $3,842,000 for 1999 and $34,548,000$55,800,000 for 3.32 2000. 3.33 (b) The appropriations in paragraph (a) must be reduced by 3.34 the amount of any money specifically appropriated for the same 3.35 purpose in any year from any state fund. 3.36 Sec. 3. Minnesota Statutes 1997 Supplement, section 4.1 273.127, subdivision 3, is amended to read: 4.2 Subd. 3. [CLASS 4C PROPERTIES.] For the market value of 4.3 properties that meet the criteria of subdivision 2, paragraph 4.4 (a), and which no longer qualify as a result of the eligibility 4.5 criteria specified in section 273.126, a class rate of 2.4 4.6 percent applies for taxes payable in 1999 and a class rate of 4.7 2.62.5 percent applies for taxes payable in 2000. 4.8 Sec. 4. Minnesota Statutes 1997 Supplement, section 4.9 273.13, subdivision 24, is amended to read: 4.10 Subd. 24. [CLASS 3.] (a) Commercial and industrial 4.11 property and utility real and personal property, except class 5 4.12 property as identified in subdivision 31, clause (1), is class 4.13 3a. Each parcel has a class rate of 2.7 percent of the first 4.14 tier of market value, and 4.0 percent for taxes payable in 1998, 4.15 1999, and 2000, 3.8 percent for taxes payable in 2001, and 3.5 4.16 percent for taxes payable in 2002 and thereafter of the 4.17 remaining market value, except that in the case of contiguous 4.18 parcels of commercial and industrial property owned by the same 4.19 person or entity, only the value equal to the first-tier value 4.20 of the contiguous parcels qualifies for the reduced class rate. 4.21 For the purposes of this subdivision, the first tier means the 4.22 first $150,000 of market value. In the case of utility property 4.23 owned by one person or entity, only one parcel in each county 4.24 has a reduced class rate on the first tier of market value. 4.25 For purposes of this paragraph, parcels are considered to 4.26 be contiguous even if they are separated from each other by a 4.27 road, street, vacant lot, waterway, or other similar intervening 4.28 type of property. 4.29 (b) Employment property defined in section 469.166, during 4.30 the period provided in section 469.170, shall constitute class 4.31 3b and has a class rate of 2.3 percent of the first $50,000 of 4.32 market value and 3.6 percent for taxes payable in 2001 and prior 4.33 years, and 3.5 percent for taxes payable in 2002 and thereafter 4.34 of the remainder, except that for employment property located in 4.35 a border city enterprise zone designated pursuant to section 4.36 469.168, subdivision 4, paragraph (c), the class rate of the 5.1 first tier of market value and the class rate of the remainder 5.2 is determined under paragraph (a), unless the governing body of 5.3 the city designated as an enterprise zone determines that a 5.4 specific parcel shall be assessed pursuant to the first clause 5.5 of this sentence. The governing body may provide for assessment 5.6 under the first clause of the preceding sentence only for 5.7 property which is located in an area which has been designated 5.8 by the governing body for the receipt of tax reductions 5.9 authorized by section 469.171, subdivision 1. 5.10 (c) Structures which are (i) located on property classified 5.11 as class 3a, (ii) constructed under an initial building permit 5.12 issued after January 2, 1996, (iii) located in a transit zone as 5.13 defined under section 473.3915, subdivision 3, (iv) located 5.14 within the boundaries of a school district, and (v) not 5.15 primarily used for retail or transient lodging purposes, shall 5.16 have a class rate equal to 85 percent of the class rate of the 5.17 second tier of the commercial property rate under paragraph (a) 5.18 on any portion of the market value that does not qualify for the 5.19 first tier class rate under paragraph (a). As used in item (v), 5.20 a structure is primarily used for retail or transient lodging 5.21 purposes if over 50 percent of its square footage is used for 5.22 those purposes. The four percent rateA class rate equal to 85 5.23 percent of the class rate of the second tier of the commercial 5.24 property rate under paragraph (a) shall also apply to 5.25 improvements to existing structures that meet the requirements 5.26 of items (i) to (v) if the improvements are constructed under an 5.27 initial building permit issued after January 2, 1996, even if 5.28 the remainder of the structure was constructed prior to January 5.29 2, 1996. For the purposes of this paragraph, a structure shall 5.30 be considered to be located in a transit zone if any portion of 5.31 the structure lies within the zone. If any property once 5.32 eligible for treatment under this paragraph ceases to remain 5.33 eligible due to revisions in transit zone boundaries, the 5.34 property shall continue to receive treatment under this 5.35 paragraph for a period of three years. 5.36 Sec. 5. Minnesota Statutes 1997 Supplement, section 6.1 273.13, subdivision 25, as amended by Laws 1997, Third Special 6.2 Session chapter 3, section 28, is amended to read: 6.3 Subd. 25. [CLASS 4.] (a) Class 4a is residential real 6.4 estate containing four or more units and used or held for use by 6.5 the owner or by the tenants or lessees of the owner as a 6.6 residence for rental periods of 30 days or more. Class 4a also 6.7 includes hospitals licensed under sections 144.50 to 144.56, 6.8 other than hospitals exempt under section 272.02, and contiguous 6.9 property used for hospital purposes, without regard to whether 6.10 the property has been platted or subdivided. Class 4a property 6.11 in a city with a population of 5,000 or less, that is (1) 6.12 located outside of the metropolitan area, as defined in section 6.13 473.121, subdivision 2, or outside any county contiguous to the 6.14 metropolitan area, and (2) whose city boundary is at least 15 6.15 miles from the boundary of any city with a population greater 6.16 than 5,000 has a class rate of 2.3 percent of market value. All 6.17 other class 4a property has a class rate of 2.92.65 percent of 6.18 market value for taxes payable in 1999 and 2.5 percent of market 6.19 value for taxes payable in 2000 and thereafter. For purposes of 6.20 this paragraph, population has the same meaning given in section 6.21 477A.011, subdivision 3. 6.22 (b) Class 4b includes: 6.23 (1) residential real estate containing less than four units 6.24 that does not qualify as class 4bb, other than seasonal 6.25 residential, and recreational; 6.26 (2) manufactured homes not classified under any other 6.27 provision; 6.28 (3) a dwelling, garage, and surrounding one acre of 6.29 property on a nonhomestead farm classified under subdivision 23, 6.30 paragraph (b) containing two or three units; 6.31 (4) unimproved property that is classified residential as 6.32 determined under section 273.13, subdivision 33. 6.33 Class 4b property has a class rate of 2.1 percent of market 6.34 value. 6.35 (c) Class 4bb includes: 6.36 (1) nonhomestead residential real estate containing one 7.1 unit, other than seasonal residential, and recreational; and 7.2 (2) a single family dwelling, garage, and surrounding one 7.3 acre of property on a nonhomestead farm classified under 7.4 subdivision 23, paragraph (b). 7.5 Class 4bb has a class rate of 1.91.5 percent for taxes 7.6 payable in 1999 and 1.25 percent for taxes payable in 2000 and 7.7 thereafter on the first $75,000 of market value and a class rate 7.8 of 2.11.85 percent for taxes payable in 2000 and thereafter of 7.9 its market value that exceeds $75,000. 7.10 Property that has been classified as seasonal recreational 7.11 residential property at any time during which it has been owned 7.12 by the current owner or spouse of the current owner does not 7.13 qualify for class 4bb. 7.14 (d) Class 4c property includes: 7.15 (1) except as provided in subdivision 22, paragraph (c), 7.16 real property devoted to temporary and seasonal residential 7.17 occupancy for recreation purposes, including real property 7.18 devoted to temporary and seasonal residential occupancy for 7.19 recreation purposes and not devoted to commercial purposes for 7.20 more than 250 days in the year preceding the year of 7.21 assessment. For purposes of this clause, property is devoted to 7.22 a commercial purpose on a specific day if any portion of the 7.23 property is used for residential occupancy, and a fee is charged 7.24 for residential occupancy. In order for a property to be 7.25 classified as class 4c, seasonal recreational residential for 7.26 commercial purposes, at least 40 percent of the annual gross 7.27 lodging receipts related to the property must be from business 7.28 conducted between Memorial Day weekend and Labor Day weekend and 7.29 at least 60 percent of all bookings by lodging guests during the 7.30 year must be for periods of at least two consecutive nights. 7.31 Class 4c also includes commercial use real property used 7.32 exclusively for recreational purposes in conjunction with class 7.33 4c property devoted to temporary and seasonal residential 7.34 occupancy for recreational purposes, up to a total of two acres, 7.35 provided the property is not devoted to commercial recreational 7.36 use for more than 250 days in the year preceding the year of 8.1 assessment and is located within two miles of the class 4c 8.2 property with which it is used. Class 4c property classified in 8.3 this clause also includes the remainder of class 1c resorts. 8.4 Owners of real property devoted to temporary and seasonal 8.5 residential occupancy for recreation purposes and all or a 8.6 portion of which was devoted to commercial purposes for not more 8.7 than 250 days in the year preceding the year of assessment 8.8 desiring classification as class 1c or 4c, must submit a 8.9 declaration to the assessor designating the cabins or units 8.10 occupied for 250 days or less in the year preceding the year of 8.11 assessment by January 15 of the assessment year. Those cabins 8.12 or units and a proportionate share of the land on which they are 8.13 located will be designated class 1c or 4c as otherwise 8.14 provided. The remainder of the cabins or units and a 8.15 proportionate share of the land on which they are located will 8.16 be designated as class 3a. The owner of property desiring 8.17 designation as class 1c or 4c property must provide guest 8.18 registers or other records demonstrating that the units for 8.19 which class 1c or 4c designation is sought were not occupied for 8.20 more than 250 days in the year preceding the assessment if so 8.21 requested. The portion of a property operated as a (1) 8.22 restaurant, (2) bar, (3) gift shop, and (4) other nonresidential 8.23 facility operated on a commercial basis not directly related to 8.24 temporary and seasonal residential occupancy for recreation 8.25 purposes shall not qualify for class 1c or 4c; 8.26 (2) qualified property used as a golf course if: 8.27 (i) any portion of the property is located within a county 8.28 that has a population of less than 50,000, or within a county 8.29 containing a golf course owned by a municipality, the county, or 8.30 a special taxing district; 8.31 (ii) it is open to the public on a daily fee basis. It may 8.32 charge membership fees or dues, but a membership fee may not be 8.33 required in order to use the property for golfing, and its green 8.34 fees for golfing must be comparable to green fees typically 8.35 charged by municipal courses; and 8.36 (iii) it meets the requirements of section 273.112, 9.1 subdivision 3, paragraph (d). 9.2 A structure used as a clubhouse, restaurant, or place of 9.3 refreshment in conjunction with the golf course is classified as 9.4 class 3a property. 9.5 (3) real property up to a maximum of one acre of land owned 9.6 by a nonprofit community service oriented organization; provided 9.7 that the property is not used for a revenue-producing activity 9.8 for more than six days in the calendar year preceding the year 9.9 of assessment and the property is not used for residential 9.10 purposes on either a temporary or permanent basis. For purposes 9.11 of this clause, a "nonprofit community service oriented 9.12 organization" means any corporation, society, association, 9.13 foundation, or institution organized and operated exclusively 9.14 for charitable, religious, fraternal, civic, or educational 9.15 purposes, and which is exempt from federal income taxation 9.16 pursuant to section 501(c)(3), (10), or (19) of the Internal 9.17 Revenue Code of 1986, as amended through December 31, 1990. For 9.18 purposes of this clause, "revenue-producing activities" shall 9.19 include but not be limited to property or that portion of the 9.20 property that is used as an on-sale intoxicating liquor or 3.2 9.21 percent malt liquor establishment licensed under chapter 340A, a 9.22 restaurant open to the public, bowling alley, a retail store, 9.23 gambling conducted by organizations licensed under chapter 349, 9.24 an insurance business, or office or other space leased or rented 9.25 to a lessee who conducts a for-profit enterprise on the 9.26 premises. Any portion of the property which is used for 9.27 revenue-producing activities for more than six days in the 9.28 calendar year preceding the year of assessment shall be assessed 9.29 as class 3a. The use of the property for social events open 9.30 exclusively to members and their guests for periods of less than 9.31 24 hours, when an admission is not charged nor any revenues are 9.32 received by the organization shall not be considered a 9.33 revenue-producing activity; 9.34 (4) post-secondary student housing of not more than one 9.35 acre of land that is owned by a nonprofit corporation organized 9.36 under chapter 317A and is used exclusively by a student 10.1 cooperative, sorority, or fraternity for on-campus housing or 10.2 housing located within two miles of the border of a college 10.3 campus; and 10.4 (5) manufactured home parks as defined in section 327.14, 10.5 subdivision 3. 10.6 Class 4c property has a class rate of 2.1 percent of market 10.7 value, except that (i) for each parcel of seasonal residential 10.8 recreational property not used for commercial purposes the first 10.9 $75,000 of market value has a class rate of 1.4 percent, and the 10.10 market value that exceeds $75,000 has a class rate of 2.5 10.11 percent, and (ii) manufactured home parks assessed under clause 10.12 (5) have a class rate of two percent. 10.13 (e) Class 4d property is qualifying low-income rental 10.14 housing certified to the assessor by the housing finance agency 10.15 under sections 273.126 and 462A.071. Class 4d includes land in 10.16 proportion to the total market value of the building that is 10.17 qualifying low-income rental housing. For all properties 10.18 qualifying as class 4d, the market value determined by the 10.19 assessor must be based on the normal approach to value using 10.20 normal unrestricted rents. 10.21 Class 4d property has a class rate of one percent of market 10.22 value. 10.23 (f) Class 4e property consists of the residential portion 10.24 of any structure located within a city that was converted from 10.25 nonresidential use to residential use, provided that: 10.26 (1) the structure had formerly been used as a warehouse; 10.27 (2) the structure was originally constructed prior to 1940; 10.28 (3) the conversion was done after December 31, 1995, but 10.29 before January 1, 2003; and 10.30 (4) the conversion involved an investment of at least 10.31 $25,000 per residential unit. 10.32 Class 4e property has a class rate of 2.3 percent, provided 10.33 that a structure is eligible for class 4e classification only in 10.34 the 12 assessment years immediately following the conversion. 10.35 Sec. 6. Minnesota Statutes 1997 Supplement, section 10.36 273.13, subdivision 31, is amended to read: 11.1 Subd. 31. [CLASS 5.] Class 5 property includes: 11.2 (1) tools, implements, and machinery of an electric 11.3 generating, transmission, or distribution system or a pipeline 11.4 system transporting or distributing water, gas, crude oil, or 11.5 petroleum products or mains and pipes used in the distribution 11.6 of steam or hot or chilled water for heating or cooling 11.7 buildings, which are fixtures; 11.8 (2) unmined iron ore and low-grade iron-bearing formations 11.9 as defined in section 273.14; and 11.10 (3) all other property not otherwise classified. 11.11 Class 5 property has a class rate of 4.0 percent of market 11.12 value for taxes payable in 1998, 1999, and 2000, 3.8 percent of 11.13 market value for taxes payable in 2001, and 3.5 percent of 11.14 market value for taxes payable in 2002 and thereafter. 11.15 Sec. 7. Minnesota Statutes 1997 Supplement, section 11.16 273.1382, subdivision 1, is amended to read: 11.17 Subdivision 1. [EDUCATION HOMESTEAD CREDIT.] Each year, 11.18 beginning with property taxes payable in 1998, the respective 11.19 county auditors shall determine the initial tax rate for each 11.20 school district for the general education levy certified under 11.21 section 124A.23, subdivision 2 or 3. That rate plus the school 11.22 district's education homestead credit tax rate adjustment under 11.23 section 275.08, subdivision 1e, shall be the general education 11.24 homestead credit local tax rate for the district. The auditor 11.25 shall then determine a general education homestead credit for 11.26 each homestead within the county equal to 32 percent for taxes 11.27 payable in 1998 and 1999 and 40 percent for taxes payable in 11.28 2000 and thereafter of the general education homestead credit 11.29 local tax rate times the net tax capacity of the homestead for 11.30 the taxes payable year. The amount of general education 11.31 homestead credit for a homestead may not exceed $225 for taxes 11.32 payable in 1998 and 1999 and $250 for taxes payable in 2000 and 11.33 thereafter. In the case of an agricultural homestead, only the 11.34 net tax capacity of the house, garage, and surrounding one acre 11.35 of land shall be used in determining the property's education 11.36 homestead credit. 12.1 Sec. 8. Minnesota Statutes 1996, section 477A.013, 12.2 subdivision 9, is amended to read: 12.3 Subd. 9. [CITY AID DISTRIBUTION.] (a) In calendar year 12.4 1994 and thereafter, each city shall receive an aid distribution 12.5 equal to the sum of (1) the city formula aid under subdivision 12.6 8, and (2) its city aid base. 12.7 (b) The percentage increase for a first class city in 12.8 calendar year 1995 and thereafter shall not exceed the 12.9 percentage increase in the sum of the aid to all cities under 12.10 this section in the current calendar year compared to the sum of 12.11 the aid to all cities in the previous year. 12.12 (c) For all years except for aids payable in 1999, the 12.13 total aid for any city, except a first class city, shall not 12.14 exceed the sum of (1) ten percent of the city's net levy for the 12.15 year prior to the aid distribution plus (2) its total aid in the 12.16 previous year before any increases or decreases under sections 12.17 16A.711, subdivision 5, and 477A.0132. 12.18 (d) For aids payable in 1999 only, the total aid for any 12.19 city except a first class city shall not exceed the sum of (1) 12.20 30 percent of its net levy for the year prior to the aid 12.21 distribution year plus (2) the total aid it was certified to 12.22 receive in the previous year. 12.23 (d) Notwithstanding paragraph (c), in 1995 only, for cities12.24 which in 1992 or 1993 transferred an amount from governmental12.25 funds to their sewer and water fund in an amount greater than12.26 their net levy for taxes payable in the year in which the12.27 transfer occurred, the total aid shall not exceed the sum of (1)12.28 20 percent of the city's net levy for the year prior to the aid12.29 distribution plus (2) its total aid in the previous year before12.30 any increases or decreases under sections 16A.711, subdivision12.31 5, and 477A.0132.12.32 Sec. 9. Minnesota Statutes 1996, section 477A.03, 12.33 subdivision 2, is amended to read: 12.34 Subd. 2. [ANNUAL APPROPRIATION.] A sum sufficient to 12.35 discharge the duties imposed by sections 477A.011 to 477A.014 is 12.36 annually appropriated from the general fund to the commissioner 13.1 of revenue. For aids payable in 19961999 and thereafter, the 13.2 total aids paid under sections 477A.013, subdivision 13.3 9, 477A.0121, and 477A.0122 are the amounts certified to be paid 13.4 in the previous year, adjusted for inflation and population 13.5 growth as provided under subdivision 3. Aid payments to13.6 counties under section 477A.0121 are limited to $20,265,000 in13.7 1996. Aid payments to counties under section 477A.0121 are13.8 limited to $27,571,625 in 1997. For aid payable in 1998 and13.9 thereafter, the total aids paid under section 477A.0121 are the13.10 amounts certified to be paid in the previous year, adjusted for13.11 inflation as provided under subdivision 3.13.12 Sec. 10. Minnesota Statutes 1997 Supplement, section 13.13 477A.03, subdivision 3, is amended to read: 13.14 Subd. 3. [INFLATION ADJUSTMENT.] In 1996 and thereafter, 13.15 the amount paid under each section to be adjusted for inflation 13.16 shall be increased by an amount equal to: 13.17 (a) the amount certified to be paid under that section in 13.18 the previous year multiplied by 13.19 (b) one plus the percentage increase in population for all 13.20 local governments eligible for the aid paid under that section 13.21 for the most recent year for which data is available; however, 13.22 for aids payable in 1999 only, under section 477A.013, 13.23 subdivision 9, the amount will be one plus the percentage 13.24 increase in total city population for the most recent four-year 13.25 period for which the data is available; multiplied by 13.26 (c) one plus the percentage increase in the implicit price 13.27 deflator for government consumption expenditures and gross 13.28 investment for state and local governments prepared by the 13.29 Bureau of Economic Analysis of the United States Department of 13.30 Commerce for the 12-month period ending March 31 of the previous 13.31 year. The percentage increase used in this subdivision shall be 13.32 no less than 2.5 percent and no greater than 5.0 percent. 13.33 Sec. 11. [FORECAST OF GENERAL FUND BALANCE; SUSPENSION.] 13.34 Implementation of the property tax changes for taxes 13.35 payable in 2000 in this act shall be dependent upon general fund 13.36 balances forecast in November 1998. If, based on the November 14.1 1998 forecast, a negative unrestricted general fund balance is 14.2 projected for the biennium ending June 30, 1999, which would 14.3 reduce the general fund budget reserve below five percent of 14.4 estimated fiscal year 1999 expenditures, then: 14.5 (1) the provisions in any section of this article which 14.6 provide for an appropriation or an increase in education 14.7 homestead credit that would first become effective for taxes or 14.8 aids payable in 2000; 14.9 (2) any provision in this article which provides for a 14.10 reduction in the general education property tax levy for fiscal 14.11 year 2001; and 14.12 (3) any provision of this article which provides for a 14.13 class rate for a specific class of property that would first 14.14 become effective for taxes payable in 2000 or later 14.15 shall be suspended for one year, and the provision shall first 14.16 become effective for taxes payable one year later than the year 14.17 designated in this act. The commissioner of finance shall 14.18 certify to the commissioner of revenue by January 31, 1999, the 14.19 effect of this section. 14.20 Sec. 12. [APPROPRIATIONS.] 14.21 (a) [SHIFT RECOGNITION APPROPRIATION.] In addition to any 14.22 amounts appropriated by other law, $7,000,000 in fiscal year 14.23 1999 and $4,900,000 in fiscal year 2000 are appropriated to the 14.24 commissioner of children, families, and learning to fund early 14.25 recognition of education aid. 14.26 (b) [EDUCATION LEVY REDUCTION APPROPRIATION.] In addition 14.27 to any amount appropriated by other law, $100,000,000 in fiscal 14.28 year 2000 and thereafter and an additional $70,000,000 in fiscal 14.29 year 2001 and thereafter are appropriated to the commissioner of 14.30 children, families, and learning to fund a reduction in the 14.31 statewide general education property tax levy. 14.32 Sec. 13. [EFFECTIVE DATE.] 14.33 Section 1 is effective July 1, 1998, for revenue for fiscal 14.34 year 2000 and later. Sections 3 to 7 are effective for taxes 14.35 payable in 1999 and thereafter. Sections 8 to 10 are effective 14.36 for aid payable in 1999 and thereafter. Sections 11 and 12 are 15.1 effective the day following final enactment.