HF 4134

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

A bill for an act
relating to taxation; authorizing a property tax levy for transit operating costs in
the metropolitan area; amending a proposed constitutional amendment allocating
the proceeds of sales tax on motor vehicles; modifying the distribution of
revenues from the sales tax on motor vehicles; authorizing the sale of trunk
highway bonds; appropriating money; amending Minnesota Statutes 2004,
sections 297B.09, subdivision 1; 473.388, subdivisions 4, 7; 473.446, subdivision
1, by adding subdivisions; Laws 2005, chapter 88, article 3, sections 9; 10.

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

ARTICLE 1

METROPOLITAN AREA TRANSIT LEVY

Section 1.

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 the sum of the amounts determined for each municipality
comprising the system as follows deleted text end new text begin exceed the sum of new text end :

(1) the deleted text begin 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 new text begin portion of the available local transit funds which the applicant proposes to use to
subsidize the proposed service; and new text end

(2) deleted text begin 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 an amount of financial assistance equal to the amount under clause (1)
multiplied by the ratio of (i) the total amount of funds used by the council to fund its transit
operations, to (ii) the total amount of taxes collected by the council under section 473.446.
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 that would accrue to the council from the tax it levies under section
473.446 in the applicant city or town or combination thereof.
new text end

new text begin (e) For purposes of this section, "tax revenues" in the city or town means the sum of:
new text end

new text begin (1) the nondebt spread levy, which is the total of the taxes extended by application of
the local tax rate for nondebt purposes on the taxable net tax capacity; and
new text end

new text begin (2) the fiscal disparities distribution levy under section 473F.08, subdivision 3,
due to the application of the council's nondebt transit levy rate to the city's or town's
distribution net tax capacity.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for grants covering transit operations
for the second half of calendar year 2007 and for each calendar year thereafter.
new text end

Sec. 2.

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

Subd. 7.

Local levy deleted text begin option deleted text end .

(a) A statutory or home rule charter city or town that is
eligible for assistance under this section new text begin , in lieu of receiving the assistance, new text end may levy a tax
for payment of new text begin operating and capital expenditures for transit and other related activities and
to provide for payment of new text end 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

new text begin (b) The transit tax revenues derived by the municipality may not exceed its available
local transit funds as defined in subdivision 4, calculated as if the percentage of transit tax
revenues were 88 percent instead of 90 percent.
new text end

new text begin The commissioner of revenue shall certify the municipality's levy limitation
under this subdivision to the municipality by June 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) To enable the municipality to receive revenues described in clause (e) (2) of
subdivision 4 that would otherwise be lost if the municipality's transit tax was not treated
as a successor levy to that made by the council under section 473.446, in the first transit
levy year and any subsequent transit levy year immediately following a year in which the
municipality declined to make the levy, 88 percent of the council's nondebt spread levy
for the current taxes payable year shall be treated as levied by the municipality, and not the
council, for purposes of section 473F.08, subdivision 3, for the purpose of determining its
local tax rate for the preceding year.
new text end

new text begin (d) Any transit taxes levied under this subdivision are not subject to, or counted
towards, any limit hereafter imposed by law on the levy of taxes upon taxable property
within any municipality unless the law specifically includes the transit tax.
new text end

deleted text begin (b) deleted text end new text begin (e) new text end This subdivision is consistent with the transit redesign plan. Eligible
municipalities opting to deleted text begin operate deleted text end new text begin levy the transit tax new text end 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 (f) new text end Within the designated Americans with Disabilities Act area, metro mobility
remains the obligation of the state.

new text begin (g) For purposes of this subdivision, "transit levy year" is any year in which the
municipality elects to levy under this subdivision.
new text end

new text begin (h) A municipality may not levy taxes under this subdivision in any year unless it
notifies the council and the commissioner of revenue of its intent to levy before July 1 of
the levy year. The notification must include the amount of the municipality's proposed
transit tax for the current levy year or an indication that the municipality intends to levy its
maximum possible amount. After June 30 in the levy year, a municipality's decision to
levy or not levy taxes under this subdivision is irrevocable for that levy year.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxes payable in 2007 and
thereafter.
new text end

Sec. 3.

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

Subdivision 1.

deleted text begin Metropolitan area transit tax. deleted text end new text begin Within transit taxing district. new text end

(a)
For the purposes of sections 473.405 to 473.449 and the metropolitan transit system,
except as otherwise provided in this subdivision new text begin and subdivision 1d new text end , the council shall levy
each year upon all taxable property within the metropolitan deleted text begin area deleted text end new text begin transit taxing district new text end ,
defined in deleted text begin section deleted text end deleted text begin 473.121, deleted text end subdivision 2, a transit tax consisting of:

new text begin (1) an amount which shall be used for payment of the expenses of operating transit
and paratransit service and to provide for payment of obligations issued by the council
under section 473.436, subdivision 6; and
new text end

deleted text begin (1) deleted text end new text begin (2) new text end an new text begin additional new text end 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 deleted text begin ; and deleted text end new text begin . new text end

deleted text begin (2) 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

deleted text begin (b) 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 (b) The property tax levied by the council for general purposes under clause (a) (1)
must not exceed the following amount for the year specified:
new text end

new text begin (1) for taxes payable in 2007, one-half of the estimated amount to be appropriated
to the council from the metropolitan area transit fund under section 16A.88, subdivision
2, in fiscal year 2006, multiplied by a factor of one plus the percentage increase in the
implicit price deflator, minus any amounts levied by any municipalities in 2007 under
section 473.388, subdivision 7;
new text end

new text begin (2) for taxes payable in 2008, the limit is the estimated amount to be appropriated
to the council from the metropolitan area transit fund under section 16A.88, subdivision
2, in fiscal year 2007, multiplied by a factor of one plus the percentage increase in the
implicit price deflator, minus any amounts levied by any municipalities in 2008 under
section 473.388, subdivision 7; and
new text end

new text begin (3) for taxes payable in 2009 and thereafter, the limit is (i) the council's property tax
levy limitation for general transit purposes for the previous year determined under this
subdivision before reduction by any amounts levied by any municipalities in the previous
year under section 473.388, subdivision 7, (ii) multiplied by a factor of one plus the
percentage increase in the implicit price deflator, (iii) minus any amounts levied by any
municipalities in the current levy year under section 473.388, subdivision 7.
new text end

new text begin (c) For purposes of this subdivision, "implicit price deflator" means the implicit
price deflator for government consumption expenditures and gross investment for state
and local governments as prepared by the United States Department of Commerce, for the
12-month period ending March 31 of the levy year.
new text end

new text begin (d) The portion of the property tax levy for transit district operating purposes
attributable to a municipality that has exercised a local levy option under section 473.388,
subdivision 7, is the amount determined under subdivision 1d. The portion of the property
tax levy for transit district operating purposes attributable to the remaining municipalities
within the transit district is found by subtracting the portions attributable to the
municipalities that have exercised a local levy option under section 473.388, subdivision 7.
new text end

new text begin (e) The county auditor shall adjust the tax rate levied pursuant to this section and
section 473.388 on all property within municipalities that receive full peak service and
limited off-peak service so that it is ten percent less than the rate within municipalities in
the district that do not qualify under this paragraph or paragraph (f).
new text end

new text begin (f) The county auditor shall adjust the tax rate levied pursuant to this section and
section 473.388 on all property within municipalities that receive limited peak service
so that it is 15 percent less than the rate within municipalities in the district that do not
qualify under this paragraph or paragraph (e).
new text end

new text begin (g) For purposes of this subdivision, "full peak and limited off-peak service" means
peak period regular route service plus weekday midday regular route service at intervals
longer than 60 minutes on the regular route with the greatest frequency; and "limited peak
period service" means peak period regular route service only.
new text end

new text begin (h) For the purposes of property taxes payable in the following year, the council shall
annually determine which cities and towns qualify for the reduced rates under paragraphs
(e) and (f) and shall certify this list to the affected county auditors on or before September
15. No changes may be made to the annual list after September 15.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxes payable in 2007 and
thereafter.
new text end

Sec. 4.

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 purposes of sections 473.405 to
473.449, and the metropolitan transit system, the metropolitan council shall levy upon all
taxable property within the metropolitan area but outside of the metropolitan transit taxing
district, as defined in subdivision 2, a transit tax which shall be equal to ten percent of the
levies provided in subdivision 1, paragraph (a). 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 2007 and
thereafter.
new text end

Sec. 5.

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 Deduction of levy for eligible municipalities. new text end

new text begin (a) The maximum the
council may levy for general purposes under subdivision 1, clause (a) (1), upon taxable
property within a municipality levying taxes under the provisions of section 473.388,
subdivision 7, is the amount that could be levied within the municipality if it were not
eligible to levy under section 473.388, subdivision 7, minus the amount actually levied
by the municipality under the aforementioned provision.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxes payable in 2007 and
thereafter.
new text end

ARTICLE 2

SALES TAX ON MOTOR VEHICLES

Section 1.

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) deleted text begin 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. deleted text end

deleted text begin (c) deleted text end From July 1, 2003, to June 30, 2007, 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.

deleted text begin (d) deleted text end new text begin (c) new text end On and after July 1, 2007, 32 percent deleted text begin of the money collected and received deleted text end
must be deposited in the highway user tax distribution fund, deleted text begin 20.5 deleted text end new text begin and 21.75 new text end percent must
be deposited in the deleted text begin 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 new text begin trunk
highway fund new text end . The remaining money must be deposited in the general fund.

new text begin (d) Notwithstanding paragraph (c), from July 1, 2007, to June 30, 2008, 38.25
percent must be deposited in the highway user tax distribution fund, and 25.5 percent
must be deposited in the trunk highway fund. The remaining money must be deposited
in the general fund.
new text end

new text begin (e) From July 1, 2008, to June 30, 2009, 44.25 percent must be deposited in the
highway user tax distribution fund, and 29.5 percent must be deposited in the trunk
highway fund. The remaining money must be deposited in the general fund.
new text end

new text begin (f) From July 1, 2009, to June 30, 2010, 50.25 percent must be deposited in the
highway user tax distribution fund, and 33.5 percent must be deposited in the trunk
highway fund. The remaining money must be deposited in the general fund.
new text end

new text begin (g) From July 1, 2010, to June 30, 2011, 56.25 percent must be deposited in the
highway user tax distribution fund, and 37.5 percent must be deposited in the trunk
highway fund. The remaining money must be deposited in the general fund.
new text end

new text begin (h) On and after July 1, 2011, 60 percent must be deposited in the highway user tax
distribution fund, and 40 percent must be deposited in the trunk highway fund.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment,
except that paragraphs (d) to (h) are effective only upon the adoption at the 2006 general
election of an amendment to the state constitution that requires dedication of all motor
vehicle sales tax revenues to transportation purposes beginning in 2011.
new text end

Sec. 2.

Laws 2005, chapter 88, article 3, section 9, is amended to read:

Sec. 9. CONSTITUTIONAL AMENDMENT PROPOSED.

An amendment to the Minnesota Constitution is proposed to the people. If the
amendment is adopted, two sections will be added to article XIV to read:

Sec. 12. Beginning with the fiscal year starting July 1, 2007, 63.75 percent of
the revenue from a tax imposed by the state on the sale of a new or used motor vehicle
must be apportioned for the transportation purposes described in section 13, then the
revenue apportioned for transportation purposes must be increased by ten percent for each
subsequent fiscal year through June 30, 2011, and then the revenue must be apportioned
100 percent for transportation purposes after June 30, 2011.

Sec. 13. The revenue apportioned in section 12 must be allocated for the following
transportation purposes: deleted text begin not more than deleted text end 60 percent must be deposited in the highway user
tax distribution fund, and deleted text begin not less than deleted text end 40 percent must be deposited in deleted text begin a fund dedicated
solely to public transit assistance as defined by law deleted text end new text begin the trunk highway fund new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 3.

Laws 2005, chapter 88, article 3, section 10, is amended to read:

Sec. 10. SUBMISSION TO VOTERS.

The constitutional amendment proposed in section deleted text begin 12 deleted text end new text begin 9 new text end must be presented to the
people at the 2006 general election. The question submitted must be:

"Shall the Minnesota Constitution be amended to dedicate revenue from a tax on the
sale of new and used motor vehicles over a five-year period, so that after June 30, 2011,
all of the revenue is dedicated deleted text begin at least 40 percent for public transit assistance and not
more than 60 percent deleted text end for highway purposes?

Yes .......

No ......."

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 4. new text begin APPROPRIATION; BOND SALE AUTHORIZATION.
new text end

new text begin new text end

new text begin Subdivision 1. new text end

new text begin Appropriation of trunk highway bonds. new text end

new text begin $2,900,000,000
is appropriated from the bond proceeds account in the trunk highway fund to the
commissioner of transportation, and must be used for the following purposes:
new text end

new text begin (1) 65 percent of the money must be used for highway bottleneck and expansion
projects within the Department of Transportation??a??a??s metropolitan district; and
new text end

new text begin (2) 35 percent of the money must be used for highway projects outside of the
Department of Transportation??a??a??s metropolitan district.
new text end

new text begin Subd. 2. new text end

new text begin Bond sale authorization. new text end

new text begin To provide the money appropriated by
subdivision 1 from the bond proceeds account in the trunk highway fund, the commissioner
of finance shall sell and issue bonds of the state in an amount up to $2,900,000,000 in
the manner, on the terms, and with the effect prescribed by Minnesota Statutes, sections
167.50 to 167.52, and by the Minnesota Constitution, article XIV, section 11, at the times
and in the amounts requested by the commissioner of transportation. The proceeds of the
bonds, except accrued interest and any premium received on the sale of the bonds, must be
credited to the bond proceeds account in the trunk highway fund.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective only upon the adoption at the 2006
general election of an amendment to the state constitution that requires dedication of all
motor vehicle sales tax revenues to transportation purposes beginning in 2011.
new text end

Sec. 5. new text begin APPROPRIATION; BOND SALE AUTHORIZATION.
new text end

new text begin Subdivision 1. new text end

new text begin Appropriation of trunk highway bonds. new text end

new text begin $2,450,000,000
is appropriated from the bond proceeds account in the trunk highway fund to the
commissioner of transportation.
new text end

new text begin Subd. 2. new text end

new text begin Bond sale authorization. new text end

new text begin To provide the money appropriated by
subdivision 1 from the bond proceeds account in the trunk highway fund, the commissioner
of finance shall sell and issue bonds of the state in an amount up to $2,450,000,000 in
the manner, on the terms, and with the effect prescribed by Minnesota Statutes, sections
167.50 to 167.52, and by the Minnesota Constitution, article XIV, section 11, at the times
and in the amounts requested by the commissioner of transportation. The proceeds of the
bonds, except accrued interest and any premium received on the sale of the bonds, must be
credited to the bond proceeds account in the trunk highway fund.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective only upon the adoption at the 2006
general election of an amendment to the state constitution that requires dedication of all
motor vehicle sales tax revenues to transportation purposes beginning in 2011.
new text end

Sec. 6. new text begin APPROPRIATION; BOND SALE AUTHORIZATION.
new text end

new text begin new text end

new text begin Subdivision 1. new text end

new text begin Appropriation of trunk highway bonds. new text end

new text begin $1,650,000,000
is appropriated from the bond proceeds account in the trunk highway fund to the
commissioner of transportation, and must be used for the following purposes:
new text end

new text begin (1) 70 percent of the money must be used for highway bottleneck and expansion
projects within the Department of Transportation??a??a??s metropolitan district; and
new text end

new text begin (2) 30 percent of the money must be used for highway projects outside of the
Department of Transportation??a??a??s metropolitan district.
new text end

new text begin Subd. 2. new text end

new text begin Bond sale authorization. new text end

new text begin To provide the money appropriated by
subdivision 1 from the bond proceeds account in the trunk highway fund, the commissioner
of finance shall sell and issue bonds of the state in an amount up to $1,650,000,000 in
the manner, on the terms, and with the effect prescribed by Minnesota Statutes, sections
167.50 to 167.52, and by the Minnesota Constitution, article XIV, section 11, at the times
and in the amounts requested by the commissioner of transportation. The proceeds of the
bonds, except accrued interest and any premium received on the sale of the bonds, must be
credited to the bond proceeds account in the trunk highway fund.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective only if an amendment to the
state constitution that requires dedication of all motor vehicle sales tax revenues to
transportation purposes beginning in 2011 is not adopted at the 2006 general election.
new text end