Minnesota Legislature
HF 785
3rd Engrossment - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am
3.11 3.12
3.13 3.14 3.15 3.16 3.17 3.18 3.19 3.20 3.21 3.22 3.23 3.24 3.25 3.26 3.27 3.28 3.29 3.30 3.31 3.32 3.33 3.34 3.35 3.36 3.37 3.38 4.1 4.2 4.3 4.4 4.5 4.6 4.7 4.8 4.9 4.10 4.11 4.12 4.13 4.14 4.15 4.16 4.17 4.18 4.19 4.20 4.21 4.22 4.23 4.24 4.25 4.26
4.27 4.28
4.29 4.30 4.31 4.32 4.33 4.34 4.35 5.1 5.2
5.3 5.4
5.5 5.6 5.7 5.8 5.9 5.10 5.11 5.12 5.13 5.14 5.15 5.16 5.17 5.18 5.19 5.20 5.21 5.22 5.23 5.24 5.25 5.26 5.27 5.28 5.29 5.30 5.31 5.32 5.33 5.34 5.35 6.1 6.2 6.3 6.4 6.5 6.6 6.7 6.8 6.9 6.10 6.11 6.12 6.13 6.14 6.15 6.16 6.17 6.18 6.19 6.20 6.21 6.22 6.23 6.24 6.25 6.26 6.27 6.28 6.29 6.30 6.31 6.32 6.33 6.34 6.35 6.36 7.1 7.2 7.3 7.4 7.5 7.6 7.7 7.8 7.9 7.10 7.11 7.12 7.13 7.14 7.15 7.16 7.17 7.18 7.19 7.20 7.21 7.22 7.23 7.24 7.25 7.26 7.27 7.28 7.29 7.30 7.31 7.32 7.33 7.34 7.35 7.36 8.1 8.2 8.3 8.4 8.5 8.6 8.7 8.8 8.9 8.10 8.11 8.12 8.13 8.14 8.15 8.16 8.17 8.18 8.19 8.20 8.21 8.22 8.23 8.24
8.25 8.26
8.27 8.28 8.29 8.30 8.31 8.32 8.33 8.34 8.35 9.1 9.2 9.3 9.4 9.5 9.6 9.7 9.8 9.9 9.10
9.11 9.12 9.13 9.14 9.15
9.16 9.17 9.18 9.19 9.20 9.21 9.22 9.23 9.24 9.25
9.26 9.27
9.28 9.29 9.30 9.31 9.32 9.33
10.1 10.2
10.3 10.4 10.5 10.6 10.7 10.8 10.9 10.10 10.11 10.12 10.13 10.14 10.15 10.16 10.17 10.18 10.19 10.20 10.21
10.22 10.23 10.24
10.25 10.26 10.27 10.28 10.29 10.30 10.31 10.32 11.1 11.2 11.3
11.4 11.5
11.6 11.7 11.8 11.9 11.10 11.11 11.12 11.13 11.14 11.15 11.16 11.17 11.18 11.19
11.20 11.21
11.22 11.23 11.24 11.25 11.26 11.27 11.28 11.29 11.30 11.31 11.32 12.1 12.2
12.3 12.4
12.5 12.6 12.7 12.8 12.9 12.10 12.11 12.12 12.13
12.14 12.15
12.16 12.17 12.18 12.19 12.20 12.21 12.22 12.23 12.24 12.25 12.26 12.27 12.28 12.29 12.30
12.31 12.32
13.1 13.2 13.3 13.4 13.5 13.6 13.7 13.8 13.9 13.10 13.11 13.12 13.13 13.14 13.15 13.16 13.17 13.18 13.19 13.20 13.21 13.22 13.23 13.24 13.25 13.26
13.27 13.28
13.29 13.30
13.31 13.32
14.1 14.2
14.3 14.4 14.5 14.6 14.7 14.8 14.9 14.10 14.11 14.12 14.13 14.14 14.15
14.16 14.17
14.18 14.19 14.20 14.21 14.22 14.23 14.24 14.25 14.26 14.27 14.28 14.29 14.30 14.31
14.32 14.33
15.1 15.2 15.3 15.4 15.5 15.6 15.7 15.8 15.9 15.10 15.11 15.12 15.13 15.14 15.15 15.16 15.17 15.18 15.19 15.20 15.21 15.22
15.23 15.24
15.25 15.26 15.27 15.28 15.29 15.30 15.31 15.32 15.33 15.34 15.35 16.1 16.2 16.3 16.4 16.5 16.6 16.7 16.8
16.9 16.10
16.11 16.12 16.13 16.14 16.15 16.16 16.17 16.18 16.19 16.20 16.21 16.22 16.23 16.24 16.25 16.26 16.27 16.28 16.29
16.30 16.31
16.32 16.33 17.1 17.2 17.3 17.4 17.5 17.6 17.7 17.8 17.9 17.10 17.11 17.12 17.13 17.14 17.15 17.16 17.17 17.18 17.19
17.20 17.21
17.22 17.23 17.24 17.25 17.26 17.27 17.28 17.29 17.30 17.31 17.32 17.33 17.34 17.35 18.1 18.2 18.3 18.4 18.5 18.6
18.7 18.8
18.9 18.10 18.11 18.12 18.13 18.14 18.15 18.16 18.17 18.18 18.19 18.20 18.21 18.22 18.23 18.24 18.25 18.26 18.27 18.28 18.29 18.30 18.31 18.32 18.33 18.34 19.1 19.2 19.3 19.4 19.5 19.6
19.7 19.8
19.9 19.10 19.11 19.12 19.13 19.14 19.15 19.16 19.17 19.18 19.19
19.20 19.21
19.22 19.23 19.24 19.25 19.26 19.27 19.28 19.29 19.30 19.31 19.32 19.33 20.1 20.2 20.3 20.4 20.5 20.6 20.7 20.8 20.9 20.10 20.11 20.12 20.13 20.14 20.15
20.16
20.17 20.18 20.19 20.20 20.21 20.22 20.23 20.24 20.25 20.26 20.27 20.28 20.29 20.30 20.31 20.32
20.33
21.1 21.2 21.3 21.4 21.5 21.6 21.7 21.8 21.9 21.10 21.11 21.12 21.13 21.14 21.15 21.16 21.17 21.18 21.19 21.20 21.21 21.22
21.23
21.24 21.25 21.26 21.27 21.28 21.29 21.30 21.31 21.32 21.33 22.1 22.2 22.3 22.4 22.5 22.6 22.7 22.8 22.9 22.10 22.11 22.12 22.13 22.14 22.15 22.16 22.17 22.18 22.19 22.20 22.21
22.22 22.23
22.24 22.25 22.26 22.27 22.28 22.29 22.30 22.31
22.32
23.1 23.2 23.3 23.4 23.5 23.6 23.7 23.8 23.9 23.10 23.11 23.12 23.13 23.14 23.15 23.16 23.17 23.18 23.19 23.20 23.21 23.22
23.23 23.24
23.25 23.26 23.27 23.28 23.29 23.30 23.31 23.32 23.33 23.34
24.1 24.2
24.3 24.4 24.5 24.6 24.7 24.8 24.9 24.10 24.11 24.12 24.13 24.14 24.15 24.16 24.17 24.18 24.19 24.20 24.21 24.22 24.23 24.24 24.25 24.26 24.27 24.28 24.29 24.30
24.31 24.32
24.33 25.1 25.2 25.3 25.4 25.5 25.6 25.7 25.8 25.9 25.10 25.11 25.12 25.13 25.14 25.15 25.16 25.17 25.18 25.19 25.20 25.21 25.22 25.23 25.24 25.25 25.26 25.27 25.28 25.29 25.30 25.31 25.32 25.33 25.34 25.35 25.36 26.1 26.2 26.3 26.4 26.5 26.6 26.7 26.8 26.9 26.10 26.11 26.12 26.13 26.14 26.15 26.16 26.17 26.18 26.19 26.20 26.21 26.22 26.23 26.24 26.25 26.26 26.27 26.28 26.29 26.30 26.31 26.32 26.33 26.34 26.35 27.1 27.2 27.3 27.4 27.5 27.6 27.7 27.8 27.9 27.10 27.11 27.12 27.13 27.14 27.15 27.16 27.17 27.18 27.19 27.20 27.21 27.22 27.23 27.24 27.25 27.26 27.27 27.28 27.29 27.30 27.31 27.32 27.33 27.34 27.35 27.36 28.1 28.2 28.3 28.4 28.5 28.6 28.7 28.8 28.9 28.10 28.11 28.12 28.13 28.14 28.15 28.16 28.17 28.18 28.19 28.20 28.21 28.22
28.23 28.24
28.25 28.26 28.27 28.28 28.29 28.30 28.31 28.32 28.33 28.34 29.1 29.2 29.3 29.4 29.5 29.6 29.7 29.8 29.9 29.10 29.11 29.12 29.13 29.14 29.15 29.16 29.17 29.18 29.19 29.20 29.21 29.22 29.23 29.24 29.25 29.26 29.27 29.28 29.29 29.30 29.31 29.32 29.33 29.34 29.35 29.36 30.1 30.2 30.3 30.4 30.5 30.6 30.7 30.8
30.9 30.10 30.11 30.12 30.13 30.14
30.15 30.16 30.17 30.18 30.19 30.20 30.21 30.22 30.23 30.24 30.25 30.26 30.27 30.28 30.29 30.30 30.31 30.32 30.33 30.34 30.35 31.1 31.2 31.3 31.4 31.5 31.6 31.7 31.8 31.9 31.10 31.11 31.12
31.13 31.14
31.15 31.16 31.17 31.18 31.19 31.20 31.21 31.22 31.23 31.24 31.25 31.26 31.27 31.28 31.29 31.30 31.31 31.32 31.33 31.34 32.1 32.2 32.3 32.4 32.5 32.6 32.7 32.8 32.9 32.10 32.11 32.12 32.13 32.14 32.15 32.16 32.17 32.18 32.19 32.20 32.21 32.22 32.23 32.24 32.25 32.26 32.27 32.28 32.29 32.30 32.31 32.32 32.33 32.34 32.35 32.36 33.1 33.2 33.3 33.4 33.5 33.6 33.7 33.8 33.9 33.10 33.11 33.12 33.13
33.14 33.15
33.16 33.17 33.18 33.19 33.20 33.21 33.22 33.23 33.24 33.25 33.26 33.27 33.28 33.29 33.30 33.31 33.32 33.33 33.34 33.35 34.1 34.2 34.3 34.4 34.5 34.6 34.7 34.8 34.9 34.10 34.11 34.12 34.13 34.14 34.15 34.16 34.17 34.18 34.19 34.20 34.21 34.22 34.23 34.24 34.25 34.26 34.27 34.28 34.29 34.30 34.31 34.32 34.33 34.34 34.35 34.36 35.1 35.2 35.3 35.4 35.5 35.6 35.7 35.8 35.9 35.10 35.11 35.12 35.13 35.14 35.15 35.16 35.17 35.18 35.19 35.20 35.21 35.22 35.23 35.24 35.25 35.26 35.27 35.28 35.29 35.30 35.31 35.32 35.33 35.34 35.35 35.36 36.1 36.2 36.3 36.4
36.5 36.6
36.7 36.8 36.9 36.10 36.11 36.12 36.13 36.14 36.15 36.16 36.17 36.18 36.19 36.20 36.21 36.22 36.23 36.24 36.25 36.26 36.27 36.28 36.29 36.30 36.31 36.32 36.33 36.34 37.1 37.2 37.3 37.4 37.5 37.6 37.7 37.8 37.9 37.10 37.11 37.12 37.13 37.14 37.15 37.16 37.17 37.18 37.19 37.20 37.21 37.22 37.23 37.24 37.25 37.26 37.27 37.28 37.29 37.30 37.31 37.32 37.33 37.34 37.35 37.36 38.1 38.2 38.3 38.4 38.5 38.6 38.7 38.8 38.9 38.10 38.11 38.12 38.13 38.14 38.15 38.16 38.17 38.18 38.19 38.20 38.21 38.22 38.23 38.24 38.25 38.26 38.27 38.28 38.29 38.30 38.31 38.32 38.33 38.34 38.35 39.1 39.2 39.3 39.4 39.5 39.6 39.7 39.8 39.9 39.10 39.11 39.12 39.13 39.14 39.15 39.16 39.17 39.18 39.19 39.20 39.21 39.22 39.23 39.24 39.25 39.26 39.27 39.28 39.29 39.30 39.31 39.32 39.33 39.34 39.35 39.36 40.1 40.2 40.3 40.4 40.5 40.6 40.7 40.8 40.9 40.10 40.11 40.12 40.13 40.14 40.15 40.16 40.17 40.18 40.19 40.20 40.21
40.22 40.23
40.24 40.25 40.26 40.27 40.28 40.29 40.30 40.31 40.32 40.33 40.34 41.1 41.2 41.3 41.4 41.5 41.6 41.7 41.8 41.9 41.10 41.11 41.12 41.13 41.14 41.15 41.16 41.17 41.18
41.19 41.20
41.21 41.22 41.23 41.24 41.25 41.26 41.27 41.28 41.29 41.30 41.31 41.32 41.33 41.34 41.35 42.1 42.2 42.3 42.4 42.5 42.6 42.7 42.8 42.9 42.10 42.11 42.12 42.13 42.14 42.15 42.16 42.17 42.18 42.19 42.20 42.21 42.22 42.23 42.24 42.25 42.26 42.27 42.28 42.29 42.30 42.31 42.32 42.33 42.34 42.35 42.36 43.1 43.2 43.3 43.4 43.5 43.6 43.7 43.8 43.9 43.10 43.11 43.12 43.13 43.14 43.15 43.16 43.17
43.18 43.19 43.20 43.21 43.22 43.23 43.24 43.25 43.26 43.27 43.28 43.29
43.30 43.31
43.32 43.33 43.34 44.1 44.2 44.3 44.4 44.5 44.6 44.7 44.8 44.9 44.10 44.11 44.12 44.13 44.14 44.15 44.16 44.17 44.18 44.19 44.20 44.21 44.22 44.23 44.24 44.25 44.26 44.27 44.28 44.29 44.30 44.31 44.32 44.33 44.34 44.35 44.36 45.1 45.2 45.3 45.4 45.5 45.6 45.7 45.8 45.9 45.10 45.11 45.12 45.13 45.14 45.15 45.16 45.17 45.18 45.19 45.20 45.21 45.22 45.23
45.24 45.25
45.26 45.27 45.28 45.29 45.30 45.31 45.32 45.33 45.34 45.35 46.1 46.2 46.3 46.4 46.5 46.6 46.7 46.8 46.9
46.10 46.11 46.12 46.13
46.14 46.15 46.16 46.17 46.18 46.19 46.20 46.21 46.22 46.23 46.24 46.25 46.26 46.27 46.28 46.29 46.30 46.31 46.32 46.33 46.34 46.35
47.1 47.2
47.3 47.4 47.5 47.6 47.7 47.8 47.9 47.10 47.11 47.12 47.13 47.14 47.15 47.16 47.17 47.18 47.19 47.20 47.21 47.22 47.23 47.24 47.25 47.26 47.27 47.28 47.29 47.30 47.31 47.32 47.33 47.34 48.1 48.2
48.3 48.4
48.5 48.6 48.7 48.8 48.9 48.10 48.11 48.12
48.13 48.14
48.15 48.16 48.17 48.18 48.19 48.20 48.21 48.22 48.23 48.24 48.25 48.26 48.27 48.28 48.29 48.30 48.31 48.32 49.1 49.2 49.3
49.4 49.5
49.6 49.7 49.8 49.9 49.10
49.11
49.12 49.13 49.14 49.15 49.16 49.17 49.18 49.19 49.20 49.21 49.22 49.23 49.24 49.25 49.26 49.27 49.28 49.29 49.30 49.31 49.32
50.1 50.2
50.3 50.4 50.5 50.6 50.7 50.8
50.9 50.10 50.11 50.12
50.13 50.14 50.15 50.16 50.17 50.18 50.19 50.20 50.21 50.22 50.23 50.24 50.25
50.26
50.27 50.28 50.29 50.30 50.31 51.1 51.2 51.3 51.4 51.5 51.6 51.7 51.8
51.9
51.10 51.11 51.12 51.13 51.14 51.15 51.16 51.17 51.18 51.19 51.20 51.21 51.22
51.23 51.24
51.25 51.26 51.27 51.28 51.29
51.30 51.31
51.32 52.1 52.2 52.3 52.4 52.5 52.6 52.7 52.8 52.9
52.10 52.11
52.12 52.13 52.14 52.15 52.16 52.17
52.18 52.19
52.20 52.21 52.22 52.23 52.24 52.25 52.26 52.27 52.28 52.29 52.30 52.31 52.32 53.1 53.2 53.3 53.4 53.5 53.6 53.7 53.8 53.9 53.10
53.11 53.12
53.13 53.14 53.15 53.16 53.17 53.18 53.19 53.20 53.21 53.22 53.23 53.24 53.25 53.26 53.27 53.28 53.29 53.30 53.31 53.32 53.33 53.34 53.35
54.1 54.2
54.3 54.4 54.5 54.6 54.7 54.8 54.9 54.10 54.11 54.12 54.13 54.14 54.15 54.16 54.17 54.18 54.19 54.20 54.21 54.22 54.23 54.24 54.25 54.26 54.27 54.28 54.29 54.30 54.31
54.32 54.33
55.1 55.2 55.3 55.4 55.5 55.6 55.7 55.8 55.9 55.10 55.11 55.12 55.13 55.14 55.15 55.16 55.17 55.18 55.19 55.20 55.21 55.22 55.23 55.24 55.25 55.26 55.27 55.28 55.29 55.30 55.31 55.32 55.33
55.34
56.1 56.2
56.3 56.4
56.5 56.6
56.7 56.8 56.9 56.10 56.11
56.12 56.13 56.14 56.15 56.16 56.17 56.18 56.19 56.20 56.21
56.22
56.23 56.24 56.25 56.26 56.27 56.28 56.29 56.30 56.31 56.32
57.1
57.2 57.3 57.4 57.5 57.6 57.7 57.8 57.9 57.10 57.11 57.12 57.13 57.14 57.15 57.16 57.17 57.18 57.19 57.20 57.21 57.22 57.23 57.24 57.25 57.26 57.27 57.28 57.29 57.30 57.31 57.32 57.33 57.34 58.1 58.2 58.3 58.4 58.5 58.6 58.7 58.8 58.9 58.10 58.11 58.12
58.13 58.14
58.15 58.16 58.17 58.18 58.19 58.20 58.21 58.22 58.23 58.24 58.25
58.26
58.27 58.28
58.29
59.1 59.2
59.3 59.4 59.5 59.6 59.7 59.8 59.9 59.10 59.11 59.12 59.13 59.14 59.15 59.16 59.17 59.18 59.19 59.20 59.21 59.22 59.23 59.24 59.25 59.26 59.27 59.28 59.29 59.30 59.31 59.32 59.33 59.34 59.35 60.1 60.2 60.3 60.4 60.5 60.6 60.7 60.8 60.9 60.10 60.11 60.12 60.13 60.14 60.15 60.16 60.17
60.18
60.19 60.20 60.21 60.22 60.23 60.24 60.25 60.26 60.27 60.28 60.29 60.30 60.31 60.32 60.33
61.1 61.2
61.3 61.4 61.5 61.6 61.7 61.8 61.9 61.10
61.11
61.12 61.13 61.14 61.15 61.16 61.17 61.18 61.19 61.20 61.21 61.22 61.23 61.24 61.25 61.26 61.27 61.28 61.29 61.30 61.31 61.32 61.33
62.1
62.2 62.3 62.4 62.5 62.6 62.7 62.8 62.9 62.10
62.11
62.12 62.13 62.14 62.15 62.16 62.17 62.18 62.19 62.20 62.21 62.22 62.23 62.24 62.25
62.26
62.27 62.28 62.29 62.30 62.31 62.32 63.1 63.2 63.3 63.4 63.5 63.6 63.7 63.8 63.9 63.10 63.11 63.12 63.13 63.14 63.15 63.16 63.17 63.18 63.19 63.20
63.21
63.22 63.23 63.24 63.25 63.26 63.27 63.28 63.29 63.30 63.31
63.32
63.33 64.1 64.2 64.3 64.4 64.5 64.6 64.7 64.8 64.9 64.10 64.11 64.12 64.13 64.14 64.15 64.16 64.17 64.18 64.19 64.20 64.21 64.22 64.23 64.24 64.25 64.26 64.27 64.28 64.29 64.30 64.31 64.32 64.33 64.34 64.35 65.1 65.2 65.3 65.4 65.5 65.6 65.7 65.8 65.9 65.10 65.11 65.12 65.13 65.14 65.15 65.16 65.17 65.18 65.19 65.20 65.21 65.22 65.23 65.24 65.25 65.26 65.27 65.28 65.29 65.30 65.31 65.32 65.33 65.34 65.35 65.36 66.1 66.2 66.3 66.4 66.5 66.6 66.7 66.8 66.9 66.10 66.11 66.12 66.13 66.14 66.15 66.16 66.17 66.18 66.19 66.20 66.21 66.22 66.23 66.24 66.25 66.26 66.27 66.28 66.29 66.30 66.31 66.32 66.33 66.34 66.35 66.36 67.1 67.2 67.3 67.4 67.5 67.6 67.7 67.8 67.9 67.10 67.11 67.12 67.13 67.14 67.15 67.16 67.17 67.18 67.19 67.20 67.21 67.22 67.23 67.24 67.25 67.26 67.27 67.28 67.29 67.30 67.31 67.32 67.33 67.34 67.35 67.36 68.1 68.2 68.3 68.4 68.5
68.6 68.7
68.8 68.9 68.10 68.11 68.12 68.13 68.14 68.15 68.16
68.17
68.18 68.19 68.20 68.21 68.22 68.23 68.24 68.25 68.26 68.27 68.28 68.29 68.30 68.31 68.32 68.33 69.1 69.2 69.3 69.4 69.5 69.6 69.7 69.8 69.9 69.10 69.11 69.12 69.13 69.14 69.15 69.16 69.17 69.18
69.19
69.20 69.21 69.22 69.23 69.24 69.25 69.26 69.27 69.28 69.29 69.30 69.31 69.32 69.33 69.34 70.1 70.2 70.3 70.4 70.5 70.6
70.7 70.8
70.9 70.10 70.11 70.12 70.13 70.14 70.15 70.16 70.17 70.18 70.19 70.20 70.21 70.22 70.23 70.24 70.25 70.26 70.27 70.28
70.29
70.30 70.31 70.32 70.33 71.1 71.2 71.3 71.4 71.5 71.6 71.7 71.8 71.9 71.10 71.11 71.12 71.13 71.14 71.15 71.16 71.17
71.18
71.19 71.20 71.21 71.22 71.23 71.24 71.25
71.26 71.27
71.28 71.29 71.30 71.31 71.32 71.33 72.1 72.2 72.3
72.4
72.5 72.6 72.7 72.8 72.9 72.10 72.11 72.12 72.13 72.14 72.15 72.16 72.17 72.18 72.19 72.20 72.21 72.22 72.23 72.24 72.25 72.26 72.27 72.28 72.29
72.30 72.31
72.32 72.33 73.1 73.2 73.3 73.4 73.5 73.6 73.7 73.8 73.9 73.10 73.11 73.12 73.13 73.14 73.15 73.16 73.17 73.18 73.19 73.20 73.21 73.22 73.23 73.24 73.25 73.26 73.27 73.28 73.29 73.30 73.31 73.32 73.33 73.34 73.35
73.36
74.1 74.2 74.3 74.4 74.5 74.6 74.7 74.8 74.9 74.10 74.11 74.12 74.13 74.14 74.15 74.16 74.17 74.18 74.19 74.20 74.21 74.22
74.23
74.24 74.25 74.26 74.27 74.28 74.29 74.30 74.31 74.32 74.33
74.34
75.1 75.2 75.3 75.4 75.5
75.6
75.7 75.8 75.9 75.10 75.11
75.12
75.13 75.14
75.15 75.16 75.17 75.18 75.19 75.20 75.21 75.22 75.23 75.24
75.25
75.26 75.27 75.28 75.29 75.30 75.31 76.1 76.2 76.3 76.4 76.5 76.6 76.7 76.8 76.9 76.10 76.11 76.12
76.13
76.14 76.15 76.16 76.17 76.18 76.19
76.20
76.21 76.22
76.23 76.24 76.25 76.26 76.27 76.28
76.29
76.30 77.1 77.2 77.3 77.4 77.5 77.6 77.7 77.8 77.9 77.10
77.11 77.12
77.13 77.14 77.15 77.16 77.17 77.18 77.19 77.20 77.21 77.22
77.23
77.24 77.25 77.26 77.27 77.28
77.29
77.30 77.31 78.1 78.2 78.3
78.4
78.5 78.6 78.7 78.8 78.9 78.10
78.11
78.12 78.13 78.14 78.15 78.16
78.17
78.18 78.19 78.20 78.21
78.22
78.23 78.24 78.25 78.26 78.27
78.28 78.29 79.1 79.2
79.3
79.4 79.5 79.6 79.7 79.8 79.9 79.10 79.11 79.12 79.13 79.14 79.15 79.16 79.17 79.18
79.19 79.20
79.21 79.22 79.23 79.24 79.25 79.26 79.27 79.28 79.29 79.30
79.31
79.32 80.1 80.2 80.3 80.4 80.5 80.6 80.7 80.8 80.9 80.10 80.11 80.12 80.13 80.14 80.15 80.16 80.17 80.18 80.19 80.20 80.21 80.22 80.23 80.24 80.25 80.26 80.27 80.28 80.29 80.30 80.31 80.32 80.33 80.34 80.35 80.36 81.1 81.2 81.3 81.4 81.5 81.6 81.7 81.8 81.9 81.10 81.11 81.12 81.13 81.14 81.15 81.16 81.17 81.18 81.19 81.20 81.21 81.22 81.23 81.24 81.25 81.26 81.27 81.28 81.29
81.30 81.31
81.32 81.33 81.34 81.35 82.1 82.2 82.3 82.4 82.5 82.6 82.7 82.8 82.9 82.10 82.11 82.12 82.13 82.14 82.15 82.16 82.17 82.18 82.19 82.20 82.21 82.22 82.23 82.24 82.25 82.26 82.27 82.28 82.29 82.30 82.31 82.32 82.33 82.34 82.35 82.36 83.1 83.2 83.3 83.4 83.5 83.6 83.7 83.8 83.9 83.10 83.11 83.12 83.13
83.14 83.15
83.16 83.17 83.18 83.19 83.20 83.21 83.22 83.23 83.24 83.25 83.26 83.27 83.28 83.29 83.30 83.31 83.32 83.33 83.34 83.35 84.1 84.2 84.3 84.4 84.5 84.6 84.7 84.8 84.9 84.10 84.11 84.12 84.13 84.14 84.15 84.16 84.17 84.18 84.19 84.20 84.21 84.22 84.23 84.24 84.25 84.26 84.27 84.28 84.29 84.30 84.31 84.32 84.33 84.34 84.35 84.36 85.1 85.2 85.3 85.4 85.5 85.6 85.7 85.8 85.9 85.10 85.11 85.12 85.13 85.14 85.15 85.16 85.17 85.18 85.19 85.20 85.21 85.22 85.23 85.24 85.25 85.26 85.27 85.28 85.29 85.30 85.31 85.32 85.33 85.34 85.35 85.36 86.1 86.2 86.3 86.4 86.5 86.6 86.7 86.8 86.9 86.10 86.11 86.12 86.13 86.14 86.15 86.16 86.17 86.18 86.19 86.20 86.21 86.22 86.23 86.24 86.25 86.26 86.27
86.28 86.29
86.30 86.31 86.32 86.33 86.34 86.35 87.1 87.2 87.3 87.4 87.5 87.6 87.7 87.8 87.9 87.10 87.11 87.12 87.13 87.14 87.15 87.16 87.17 87.18 87.19 87.20 87.21 87.22 87.23 87.24 87.25 87.26 87.27 87.28 87.29 87.30
87.31
87.32 87.33 87.34 88.1 88.2 88.3 88.4 88.5 88.6 88.7 88.8 88.9 88.10 88.11 88.12 88.13 88.14 88.15 88.16 88.17 88.18 88.19 88.20 88.21 88.22 88.23
88.24 88.25
88.26 88.27 88.28 88.29 88.30 88.31 88.32 88.33 88.34 89.1 89.2 89.3 89.4 89.5 89.6 89.7 89.8 89.9 89.10 89.11 89.12 89.13
89.14
89.15 89.16
89.17 89.18 89.19 89.20 89.21 89.22 89.23 89.24 89.25 89.26 89.27 89.28 89.29 89.30 89.31 89.32 89.33 89.34 90.1 90.2 90.3 90.4 90.5 90.6 90.7 90.8 90.9 90.10 90.11 90.12 90.13 90.14 90.15 90.16 90.17 90.18 90.19 90.20 90.21 90.22 90.23 90.24 90.25 90.26 90.27 90.28 90.29 90.30 90.31 90.32 90.33 90.34 90.35 90.36 91.1 91.2 91.3 91.4 91.5 91.6 91.7 91.8 91.9 91.10 91.11 91.12 91.13 91.14 91.15 91.16 91.17 91.18 91.19 91.20
91.21
91.22 91.23 91.24 91.25 91.26 91.27 91.28 91.29 91.30
91.31
91.32 92.1 92.2 92.3 92.4 92.5 92.6 92.7 92.8 92.9 92.10 92.11 92.12 92.13 92.14 92.15 92.16 92.17 92.18 92.19
92.20
92.21 92.22 92.23 92.24 92.25 92.26 92.27 92.28 92.29 92.30 92.31 92.32 92.33 92.34
93.1
93.2 93.3 93.4 93.5 93.6 93.7 93.8 93.9 93.10 93.11 93.12 93.13 93.14 93.15 93.16 93.17 93.18 93.19 93.20 93.21 93.22
93.23
93.24 93.25 93.26 93.27 93.28 93.29 93.30 93.31 93.32 94.1 94.2 94.3 94.4 94.5
94.6
94.7 94.8 94.9 94.10 94.11 94.12 94.13 94.14 94.15
94.16
94.17 94.18 94.19 94.20 94.21 94.22 94.23 94.24 94.25 94.26 94.27 94.28 94.29 94.30 94.31 94.32
95.1
95.2 95.3 95.4 95.5 95.6 95.7 95.8 95.9 95.10 95.11 95.12 95.13 95.14 95.15 95.16 95.17 95.18 95.19 95.20 95.21 95.22 95.23 95.24 95.25 95.26 95.27 95.28 95.29 95.30 95.31 95.32 95.33 95.34 96.1 96.2
96.3 96.4
96.5 96.6 96.7 96.8 96.9 96.10 96.11 96.12 96.13 96.14 96.15 96.16 96.17 96.18 96.19 96.20 96.21 96.22 96.23 96.24 96.25
96.26 96.27
96.28 96.29 96.30 96.31 96.32 97.1 97.2
97.3
97.4 97.5 97.6 97.7 97.8 97.9 97.10
97.11
97.12 97.13 97.14 97.15 97.16 97.17 97.18 97.19 97.20 97.21 97.22 97.23 97.24 97.25 97.26
97.27
97.28 97.29 97.30 97.31 98.1 98.2 98.3 98.4 98.5 98.6 98.7 98.8 98.9 98.10 98.11 98.12 98.13
98.14 98.15
98.16 98.17 98.18 98.19 98.20 98.21 98.22 98.23 98.24 98.25 98.26 98.27 98.28
98.29
98.30 98.31 98.32 98.33 99.1 99.2 99.3 99.4 99.5 99.6 99.7 99.8 99.9
99.10
99.11 99.12 99.13 99.14 99.15 99.16 99.17 99.18 99.19 99.20 99.21 99.22 99.23 99.24 99.25 99.26 99.27 99.28 99.29 99.30 99.31 99.32 99.33
99.34
100.1 100.2 100.3 100.4 100.5 100.6 100.7 100.8 100.9 100.10 100.11 100.12 100.13 100.14 100.15 100.16 100.17
100.18
100.19 100.20 100.21 100.22 100.23 100.24 100.25 100.26 100.27 100.28 100.29 100.30 100.31 100.32 100.33 101.1 101.2
101.3 101.4
101.5 101.6
101.7 101.8
101.9 101.10
101.11 101.12
101.13 101.14 101.15 101.16 101.17 101.18 101.19 101.20 101.21
101.22
101.23 101.24 101.25 101.26 101.27 101.28 102.1 102.2 102.3 102.4 102.5
102.6 102.7
102.8 102.9 102.10 102.11 102.12 102.13 102.14 102.15 102.16 102.17 102.18 102.19 102.20 102.21 102.22 102.23 102.24 102.25 102.26
102.27 102.28
102.29 102.30 102.31 102.32 103.1 103.2 103.3 103.4 103.5 103.6 103.7 103.8 103.9 103.10 103.11 103.12 103.13 103.14 103.15 103.16 103.17 103.18 103.19
103.20 103.21
103.22 103.23 103.24 103.25 103.26 103.27 103.28 103.29 103.30 103.31 103.32
103.33 103.34
104.1 104.2 104.3 104.4 104.5 104.6 104.7 104.8 104.9 104.10 104.11 104.12 104.13 104.14 104.15 104.16 104.17 104.18 104.19 104.20 104.21 104.22 104.23 104.24 104.25 104.26 104.27 104.28 104.29 104.30 104.31 104.32 104.33 104.34 104.35 105.1 105.2 105.3 105.4 105.5 105.6 105.7 105.8 105.9 105.10 105.11 105.12 105.13 105.14 105.15 105.16
105.17 105.18
105.19 105.20 105.21 105.22 105.23 105.24 105.25 105.26 105.27 105.28
105.29 105.30
105.31 105.32 105.33 106.1 106.2 106.3 106.4 106.5 106.6 106.7 106.8 106.9 106.10 106.11 106.12 106.13 106.14 106.15 106.16 106.17 106.18 106.19 106.20 106.21 106.22 106.23 106.24 106.25 106.26 106.27 106.28 106.29 106.30 106.31 106.32
106.33 106.34
106.35 107.1 107.2 107.3 107.4 107.5 107.6 107.7
107.8 107.9
107.10 107.11 107.12 107.13 107.14 107.15 107.16 107.17 107.18 107.19 107.20 107.21 107.22 107.23 107.24 107.25 107.26 107.27 107.28 107.29 107.30 107.31 107.32 107.33 107.34 107.35 108.1 108.2 108.3 108.4 108.5 108.6 108.7 108.8 108.9 108.10 108.11 108.12 108.13 108.14
108.15 108.16
108.17 108.18 108.19 108.20 108.21 108.22 108.23 108.24 108.25 108.26 108.27 108.28 108.29 108.30 108.31 108.32 108.33 108.34 109.1 109.2
109.3 109.4
109.5 109.6 109.7 109.8 109.9 109.10 109.11 109.12 109.13 109.14 109.15 109.16 109.17 109.18 109.19 109.20 109.21
109.22
109.23 109.24 109.25 109.26 109.27 109.28 109.29 109.30 109.31 109.32 109.33
110.1 110.2
110.3 110.4 110.5 110.6 110.7 110.8 110.9 110.10 110.11 110.12 110.13 110.14 110.15 110.16 110.17 110.18 110.19 110.20 110.21 110.22 110.23 110.24 110.25 110.26 110.27 110.28 110.29 110.30 110.31 110.32 110.33 110.34 111.1 111.2 111.3 111.4 111.5 111.6 111.7 111.8 111.9 111.10 111.11 111.12 111.13 111.14 111.15 111.16 111.17 111.18 111.19 111.20 111.21 111.22 111.23 111.24 111.25 111.26 111.27 111.28 111.29 111.30 111.31 111.32
111.33 111.34
112.1 112.2 112.3 112.4 112.5 112.6 112.7 112.8 112.9 112.10 112.11 112.12
112.13 112.14
112.15 112.16 112.17 112.18 112.19 112.20 112.21 112.22 112.23 112.24 112.25 112.26 112.27 112.28 112.29 112.30 112.31 112.32 112.33 112.34 113.1 113.2 113.3 113.4 113.5 113.6 113.7 113.8 113.9 113.10 113.11 113.12 113.13 113.14 113.15 113.16
113.17 113.18
113.19 113.20 113.21 113.22 113.23 113.24 113.25 113.26 113.27 113.28 113.29 113.30 113.31 113.32 113.33 113.34 114.1 114.2 114.3 114.4 114.5 114.6 114.7 114.8 114.9
114.10
114.11 114.12 114.13 114.14 114.15 114.16 114.17 114.18 114.19 114.20 114.21 114.22 114.23 114.24 114.25 114.26 114.27 114.28 114.29 114.30 114.31 114.32 114.33 114.34 114.35 115.1 115.2 115.3 115.4 115.5 115.6 115.7 115.8 115.9 115.10 115.11 115.12 115.13 115.14 115.15 115.16 115.17 115.18 115.19 115.20 115.21 115.22 115.23 115.24 115.25 115.26
115.27 115.28
115.29 115.30 115.31 115.32 115.33 115.34 116.1 116.2 116.3 116.4 116.5 116.6 116.7 116.8 116.9 116.10 116.11 116.12 116.13 116.14 116.15 116.16 116.17 116.18 116.19 116.20 116.21 116.22 116.23 116.24 116.25 116.26 116.27 116.28 116.29 116.30 116.31 116.32 116.33 116.34 117.1 117.2 117.3 117.4 117.5 117.6 117.7 117.8 117.9 117.10 117.11 117.12 117.13 117.14 117.15 117.16 117.17 117.18 117.19 117.20 117.21 117.22 117.23 117.24 117.25 117.26 117.27 117.28 117.29 117.30 117.31 117.32 117.33 117.34 117.35 117.36 118.1 118.2 118.3 118.4 118.5 118.6 118.7 118.8 118.9 118.10 118.11 118.12 118.13 118.14 118.15 118.16
118.17 118.18 118.19
118.20 118.21 118.22 118.23 118.24 118.25 118.26 118.27 118.28 118.29 118.30 118.31 118.32 118.33 118.34 119.1 119.2 119.3 119.4 119.5 119.6 119.7 119.8 119.9 119.10 119.11 119.12 119.13 119.14 119.15 119.16 119.17 119.18 119.19 119.20 119.21 119.22 119.23 119.24 119.25 119.26 119.27 119.28 119.29 119.30 119.31 119.32 119.33 119.34 119.35 119.36 120.1 120.2 120.3 120.4
120.5
120.6 120.7 120.8 120.9 120.10 120.11 120.12 120.13 120.14 120.15 120.16 120.17 120.18 120.19 120.20 120.21 120.22 120.23 120.24 120.25 120.26 120.27 120.28 120.29 120.30 120.31 120.32 120.33 120.34 120.35 121.1 121.2 121.3 121.4 121.5 121.6 121.7 121.8 121.9 121.10 121.11 121.12 121.13 121.14 121.15 121.16 121.17 121.18 121.19 121.20 121.21 121.22 121.23 121.24 121.25 121.26 121.27 121.28 121.29 121.30 121.31 121.32 121.33 121.34
121.35 121.36
122.1 122.2 122.3 122.4 122.5 122.6 122.7 122.8 122.9 122.10 122.11 122.12 122.13 122.14 122.15 122.16 122.17 122.18 122.19 122.20 122.21 122.22 122.23 122.24 122.25 122.26 122.27 122.28 122.29 122.30 122.31 122.32 122.33 122.34 122.35 122.36 123.1 123.2 123.3 123.4 123.5 123.6 123.7 123.8 123.9 123.10 123.11 123.12 123.13 123.14 123.15 123.16 123.17 123.18 123.19 123.20 123.21 123.22 123.23 123.24 123.25 123.26 123.27 123.28 123.29
123.30 123.31
123.32 123.33 123.34 124.1 124.2 124.3 124.4 124.5 124.6 124.7 124.8 124.9 124.10 124.11 124.12 124.13 124.14 124.15 124.16 124.17 124.18 124.19 124.20 124.21 124.22 124.23 124.24 124.25 124.26 124.27 124.28 124.29 124.30 124.31 124.32 124.33 124.34 124.35 124.36 125.1 125.2 125.3 125.4 125.5 125.6 125.7 125.8 125.9 125.10 125.11 125.12
125.13 125.14 125.15 125.16 125.17 125.18 125.19 125.20 125.21 125.22 125.23 125.24 125.25 125.26 125.27 125.28 125.29 125.30 125.31 125.32 125.33 125.34 125.35 126.1 126.2 126.3 126.4 126.5 126.6 126.7 126.8 126.9 126.10 126.11 126.12 126.13 126.14 126.15 126.16 126.17 126.18 126.19 126.20 126.21 126.22 126.23 126.24 126.25 126.26 126.27 126.28 126.29 126.30
126.31 126.32
126.33 126.34 126.35 127.1 127.2 127.3 127.4 127.5 127.6 127.7 127.8 127.9 127.10 127.11 127.12 127.13 127.14 127.15 127.16 127.17 127.18 127.19 127.20 127.21 127.22 127.23 127.24 127.25 127.26 127.27 127.28 127.29 127.30 127.31 127.32 127.33 127.34 127.35 127.36 128.1 128.2 128.3 128.4 128.5 128.6 128.7 128.8 128.9 128.10 128.11 128.12 128.13 128.14 128.15 128.16 128.17 128.18 128.19 128.20
128.21 128.22 128.23 128.24 128.25 128.26 128.27 128.28
128.29 128.30
128.31 128.32 128.33 128.34 129.1 129.2 129.3 129.4 129.5 129.6 129.7 129.8 129.9 129.10 129.11
129.12 129.13
129.14 129.15 129.16 129.17 129.18 129.19 129.20 129.21 129.22 129.23
129.24 129.25
129.26 129.27 129.28 129.29 129.30 129.31 129.32 129.33 130.1 130.2 130.3 130.4 130.5 130.6 130.7 130.8 130.9 130.10 130.11 130.12 130.13 130.14 130.15 130.16 130.17 130.18 130.19 130.20 130.21 130.22 130.23 130.24 130.25 130.26 130.27 130.28 130.29 130.30 130.31 130.32
130.33 130.34
130.35 131.1 131.2 131.3 131.4 131.5 131.6 131.7 131.8 131.9 131.10 131.11 131.12 131.13 131.14 131.15 131.16 131.17 131.18 131.19 131.20 131.21 131.22 131.23 131.24 131.25 131.26
131.27 131.28
131.29 131.30 131.31 131.32 131.33 131.34 131.35 132.1 132.2 132.3 132.4 132.5 132.6 132.7 132.8 132.9 132.10 132.11 132.12 132.13 132.14 132.15 132.16 132.17 132.18 132.19 132.20 132.21 132.22 132.23 132.24 132.25 132.26 132.27 132.28 132.29 132.30 132.31 132.32 132.33 132.34 132.35 133.1 133.2 133.3 133.4 133.5 133.6 133.7 133.8 133.9 133.10
133.11 133.12
133.13 133.14 133.15 133.16 133.17 133.18 133.19 133.20 133.21 133.22 133.23 133.24 133.25 133.26 133.27 133.28 133.29 133.30 133.31 133.32 133.33 133.34 133.35 134.1 134.2 134.3 134.4
134.5 134.6
134.7 134.8 134.9 134.10 134.11 134.12 134.13 134.14 134.15 134.16 134.17 134.18 134.19 134.20 134.21 134.22 134.23
134.24 134.25
134.26 134.27 134.28 134.29 134.30 134.31 134.32 135.1 135.2 135.3 135.4 135.5 135.6 135.7 135.8 135.9 135.10 135.11 135.12 135.13 135.14 135.15 135.16 135.17 135.18
135.19 135.20
135.21 135.22 135.23 135.24 135.25 135.26 135.27 135.28 135.29 135.30 135.31 135.32 135.33 135.34 136.1 136.2 136.3 136.4 136.5 136.6 136.7
136.8 136.9
136.10 136.11 136.12 136.13 136.14 136.15 136.16 136.17 136.18 136.19 136.20 136.21 136.22 136.23 136.24 136.25 136.26 136.27 136.28 136.29 136.30 136.31 136.32 136.33 136.34 136.35 137.1 137.2 137.3 137.4 137.5 137.6 137.7 137.8 137.9 137.10 137.11 137.12 137.13 137.14 137.15 137.16 137.17 137.18 137.19 137.20 137.21 137.22 137.23 137.24 137.25 137.26 137.27 137.28 137.29 137.30 137.31 137.32 137.33 137.34 137.35
138.1 138.2
138.3 138.4 138.5 138.6 138.7 138.8 138.9 138.10 138.11 138.12 138.13 138.14 138.15 138.16 138.17 138.18 138.19 138.20 138.21 138.22 138.23 138.24 138.25 138.26 138.27 138.28 138.29 138.30 138.31 138.32 138.33 138.34 138.35 139.1 139.2 139.3 139.4 139.5 139.6 139.7 139.8 139.9
139.10 139.11
139.12 139.13 139.14 139.15 139.16 139.17 139.18 139.19 139.20 139.21 139.22 139.23 139.24 139.25 139.26 139.27 139.28 139.29 139.30 139.31 139.32 139.33 139.34 139.35 140.1 140.2 140.3 140.4 140.5 140.6 140.7 140.8 140.9 140.10 140.11 140.12 140.13 140.14 140.15 140.16 140.17 140.18 140.19 140.20 140.21 140.22 140.23 140.24 140.25 140.26 140.27
140.28 140.29
140.30 140.31 140.32 140.33 140.34 140.35 141.1 141.2 141.3 141.4 141.5 141.6 141.7 141.8 141.9 141.10 141.11 141.12
141.13 141.14
141.15 141.16 141.17 141.18 141.19 141.20 141.21 141.22 141.23 141.24 141.25 141.26 141.27 141.28 141.29 141.30 141.31 141.32 141.33 141.34 141.35 142.1 142.2 142.3 142.4 142.5 142.6 142.7 142.8 142.9 142.10 142.11 142.12 142.13 142.14 142.15 142.16 142.17 142.18 142.19 142.20 142.21 142.22 142.23 142.24 142.25 142.26
142.27 142.28
142.29 142.30 142.31 142.32 142.33 142.34 143.1 143.2 143.3 143.4 143.5 143.6 143.7 143.8 143.9 143.10 143.11 143.12 143.13 143.14 143.15 143.16 143.17 143.18 143.19 143.20 143.21 143.22 143.23 143.24 143.25 143.26 143.27 143.28
143.29 143.30
143.31 143.32 143.33 143.34 143.35 144.1 144.2 144.3 144.4 144.5 144.6 144.7 144.8 144.9 144.10 144.11 144.12 144.13 144.14 144.15 144.16 144.17 144.18 144.19 144.20 144.21 144.22 144.23 144.24
144.25 144.26 144.27
144.28 144.29 144.30 144.31 144.32 144.33 144.34 144.35 145.1 145.2 145.3 145.4 145.5 145.6 145.7 145.8 145.9 145.10 145.11 145.12
145.13 145.14
145.15 145.16 145.17 145.18 145.19 145.20 145.21 145.22 145.23 145.24 145.25 145.26 145.27 145.28 145.29 145.30 145.31 145.32 145.33 145.34
146.1 146.2
146.3 146.4 146.5
146.6 146.7
146.8 146.9 146.10 146.11 146.12
146.13
146.14 146.15 146.16 146.17 146.18 146.19 146.20 146.21 146.22 146.23 146.24 146.25 146.26 146.27 146.28 146.29 146.30 146.31 147.1 147.2 147.3 147.4 147.5 147.6 147.7 147.8 147.9 147.10 147.11 147.12 147.13 147.14 147.15 147.16 147.17 147.18 147.19 147.20 147.21 147.22 147.23 147.24 147.25 147.26 147.27 147.28 147.29 147.30 147.31 147.32 147.33 147.34 147.35 147.36 148.1 148.2 148.3 148.4 148.5 148.6 148.7 148.8 148.9 148.10 148.11 148.12 148.13 148.14 148.15 148.16 148.17 148.18 148.19 148.20 148.21 148.22 148.23 148.24 148.25 148.26 148.27 148.28 148.29 148.30 148.31 148.32 148.33 148.34 148.35 148.36 149.1 149.2 149.3 149.4 149.5 149.6 149.7 149.8 149.9 149.10 149.11
149.12
149.13 149.14 149.15 149.16 149.17 149.18 149.19 149.20 149.21 149.22 149.23 149.24 149.25 149.26 149.27 149.28 149.29 149.30 149.31 149.32 149.33 149.34 149.35 150.1 150.2 150.3 150.4 150.5 150.6 150.7 150.8 150.9 150.10 150.11 150.12 150.13 150.14 150.15 150.16 150.17 150.18 150.19 150.20 150.21 150.22 150.23 150.24 150.25 150.26 150.27 150.28 150.29 150.30 150.31 150.32 150.33 150.34 150.35 151.1 151.2
151.3 151.4 151.5
151.6 151.7 151.8 151.9 151.10 151.11 151.12 151.13 151.14 151.15 151.16 151.17 151.18 151.19 151.20 151.21 151.22 151.23 151.24 151.25 151.26 151.27 151.28 151.29 151.30 151.31 151.32 151.33 151.34 151.35 152.1 152.2 152.3 152.4 152.5 152.6 152.7 152.8 152.9 152.10 152.11 152.12 152.13 152.14 152.15 152.16 152.17 152.18 152.19 152.20 152.21 152.22 152.23 152.24 152.25 152.26 152.27 152.28 152.29 152.30 152.31 152.32 152.33 152.34 152.35 153.1 153.2 153.3 153.4 153.5
153.6 153.7 153.8
153.9 153.10 153.11 153.12 153.13 153.14 153.15 153.16 153.17 153.18 153.19 153.20 153.21 153.22 153.23 153.24 153.25 153.26 153.27 153.28 153.29 153.30 153.31 153.32 153.33 153.34 154.1 154.2 154.3 154.4 154.5 154.6 154.7 154.8 154.9 154.10 154.11 154.12 154.13 154.14 154.15 154.16 154.17 154.18 154.19 154.20 154.21 154.22 154.23 154.24 154.25 154.26 154.27 154.28 154.29 154.30 154.31 154.32 154.33 154.34 154.35
155.1 155.2
155.3 155.4 155.5 155.6 155.7 155.8 155.9 155.10 155.11 155.12 155.13 155.14 155.15 155.16 155.17 155.18 155.19 155.20 155.21 155.22 155.23 155.24 155.25 155.26 155.27 155.28 155.29 155.30 155.31 155.32 155.33 155.34 155.35 156.1 156.2 156.3 156.4 156.5 156.6 156.7 156.8 156.9 156.10 156.11 156.12 156.13 156.14 156.15 156.16 156.17 156.18 156.19 156.20 156.21 156.22 156.23 156.24 156.25 156.26 156.27 156.28 156.29 156.30 156.31 156.32 156.33 156.34 156.35 157.1 157.2 157.3 157.4 157.5 157.6 157.7 157.8 157.9 157.10 157.11 157.12 157.13 157.14 157.15 157.16 157.17 157.18 157.19 157.20 157.21 157.22 157.23 157.24 157.25 157.26
157.27 157.28
157.29 157.30 157.31 157.32
158.1 158.2 158.3
158.4 158.5 158.6 158.7 158.8 158.9 158.10 158.11
158.12 158.13
158.14 158.15 158.16 158.17 158.18 158.19 158.20 158.21 158.22 158.23 158.24 158.25 158.26
158.27 158.28
158.29 158.30 158.31 159.1 159.2 159.3 159.4 159.5 159.6 159.7 159.8 159.9 159.10 159.11 159.12 159.13 159.14 159.15 159.16 159.17 159.18 159.19 159.20 159.21 159.22 159.23 159.24 159.25 159.26 159.27 159.28 159.29 159.30 159.31 159.32 159.33 159.34 159.35 159.36 160.1 160.2 160.3 160.4 160.5 160.6 160.7
160.8 160.9
160.10 160.11 160.12 160.13 160.14 160.15 160.16 160.17 160.18 160.19 160.20 160.21 160.22 160.23 160.24 160.25 160.26 160.27 160.28 160.29 160.30 160.31 160.32 160.33 160.34 160.35 161.1 161.2 161.3 161.4 161.5 161.6 161.7 161.8 161.9 161.10 161.11 161.12 161.13 161.14 161.15 161.16 161.17 161.18 161.19 161.20 161.21 161.22 161.23 161.24 161.25
161.26 161.27
161.28 161.29 161.30 161.31 161.32 161.33 161.34 162.1 162.2 162.3 162.4 162.5 162.6 162.7 162.8 162.9 162.10 162.11 162.12 162.13 162.14 162.15 162.16 162.17 162.18 162.19 162.20 162.21 162.22 162.23 162.24 162.25 162.26 162.27 162.28 162.29 162.30 162.31 162.32 162.33 162.34 162.35 162.36 163.1 163.2 163.3 163.4 163.5 163.6 163.7 163.8 163.9 163.10 163.11 163.12 163.13
163.14 163.15
163.16 163.17 163.18 163.19 163.20 163.21 163.22 163.23 163.24 163.25 163.26 163.27 163.28 163.29 163.30 163.31 163.32 163.33 163.34 163.35 164.1 164.2 164.3 164.4 164.5 164.6 164.7 164.8 164.9 164.10 164.11 164.12 164.13 164.14 164.15 164.16 164.17 164.18 164.19 164.20 164.21 164.22 164.23 164.24
164.25 164.26
164.27 164.28 164.29 164.30 164.31 164.32 164.33 164.34 165.1 165.2 165.3 165.4 165.5 165.6 165.7 165.8 165.9
165.10 165.11
165.12 165.13 165.14 165.15 165.16 165.17 165.18 165.19 165.20 165.21 165.22 165.23 165.24 165.25 165.26 165.27 165.28 165.29 165.30 165.31 165.32 165.33 165.34 165.35 166.1 166.2 166.3 166.4 166.5 166.6 166.7 166.8 166.9 166.10 166.11 166.12 166.13 166.14 166.15 166.16 166.17 166.18 166.19 166.20 166.21 166.22 166.23 166.24
166.25 166.26
166.27 166.28 166.29 166.30 166.31 166.32 166.33 166.34 167.1 167.2 167.3 167.4 167.5 167.6 167.7 167.8 167.9 167.10 167.11 167.12 167.13 167.14 167.15 167.16 167.17 167.18 167.19 167.20 167.21 167.22 167.23 167.24 167.25 167.26 167.27 167.28 167.29 167.30 167.31 167.32 167.33 167.34 167.35 167.36 168.1 168.2 168.3 168.4 168.5 168.6 168.7 168.8 168.9 168.10 168.11 168.12 168.13 168.14 168.15 168.16 168.17 168.18 168.19 168.20 168.21 168.22
168.23 168.24
168.25 168.26 168.27
168.28 168.29 168.30
169.1 169.2
169.3 169.4 169.5 169.6 169.7 169.8 169.9 169.10 169.11 169.12 169.13 169.14 169.15 169.16 169.17 169.18 169.19 169.20 169.21 169.22 169.23 169.24 169.25 169.26 169.27 169.28
169.29 169.30
169.31 170.1 170.2 170.3 170.4 170.5 170.6 170.7 170.8 170.9
170.10
170.11 170.12 170.13 170.14 170.15 170.16 170.17 170.18 170.19 170.20
170.21 170.22
170.23 170.24 170.25 170.26 170.27 170.28 170.29 170.30 170.31 170.32 170.33 171.1 171.2 171.3
171.4 171.5 171.6
171.7 171.8 171.9 171.10 171.11 171.12 171.13
171.14 171.15
171.16 171.17 171.18 171.19 171.20 171.21 171.22 171.23 171.24 171.25
171.26 171.27
171.28 171.29 171.30 171.31 172.1 172.2 172.3 172.4 172.5 172.6 172.7 172.8 172.9 172.10 172.11 172.12 172.13 172.14 172.15 172.16 172.17 172.18 172.19 172.20 172.21 172.22 172.23 172.24 172.25 172.26 172.27 172.28 172.29 172.30 172.31 172.32 172.33 172.34 172.35 172.36 173.1 173.2 173.3 173.4 173.5 173.6 173.7 173.8 173.9 173.10 173.11 173.12 173.13 173.14 173.15 173.16 173.17 173.18 173.19 173.20 173.21 173.22 173.23 173.24 173.25 173.26 173.27 173.28 173.29 173.30 173.31 173.32 173.33 173.34 173.35 174.1 174.2 174.3 174.4 174.5 174.6 174.7 174.8 174.9 174.10 174.11 174.12 174.13 174.14 174.15 174.16 174.17 174.18 174.19 174.20 174.21 174.22 174.23 174.24 174.25 174.26 174.27
174.28 174.29 174.30 174.31 174.32 174.33
174.34 175.1 175.2 175.3 175.4 175.5 175.6 175.7 175.8 175.9 175.10 175.11 175.12 175.13 175.14 175.15 175.16 175.17 175.18 175.19 175.20 175.21 175.22 175.23 175.24 175.25 175.26 175.27 175.28 175.29 175.30 175.31 175.32 175.33 175.34 175.35 175.36 176.1 176.2 176.3 176.4 176.5
176.6 176.7 176.8
176.9 176.10 176.11 176.12 176.13 176.14
176.15 176.16
176.17 176.18 176.19 176.20 176.21 176.22 176.23 176.24 176.25 176.26 176.27
176.28
176.29 176.30 176.31 176.32 177.1 177.2 177.3 177.4
177.5
177.6 177.7 177.8 177.9 177.10 177.11 177.12 177.13 177.14 177.15 177.16 177.17 177.18 177.19 177.20 177.21 177.22 177.23 177.24
177.25 177.26
177.27 177.28 177.29 177.30 177.31 177.32 177.33 178.1 178.2 178.3 178.4 178.5 178.6 178.7 178.8 178.9 178.10 178.11 178.12 178.13 178.14 178.15 178.16 178.17 178.18 178.19 178.20 178.21 178.22
178.23 178.24
178.25 178.26 178.27 178.28 178.29 178.30 178.31 178.32 178.33 178.34 178.35 179.1 179.2 179.3 179.4 179.5 179.6 179.7 179.8 179.9 179.10 179.11 179.12 179.13 179.14 179.15 179.16 179.17 179.18 179.19 179.20 179.21 179.22 179.23 179.24 179.25 179.26 179.27 179.28 179.29 179.30 179.31 179.32 179.33 179.34 179.35 180.1 180.2 180.3 180.4 180.5 180.6 180.7 180.8 180.9 180.10 180.11 180.12 180.13 180.14 180.15 180.16 180.17 180.18
180.19 180.20
180.21 180.22 180.23 180.24 180.25 180.26
180.27 180.28
180.29 180.30 180.31 180.32 180.33 181.1 181.2 181.3 181.4 181.5 181.6 181.7 181.8 181.9 181.10 181.11 181.12 181.13 181.14 181.15 181.16 181.17 181.18 181.19 181.20 181.21
181.22 181.23
181.24 181.25 181.26 181.27
181.28 181.29
181.30 181.31 181.32 181.33 182.1 182.2 182.3 182.4 182.5 182.6 182.7 182.8 182.9 182.10 182.11 182.12 182.13 182.14 182.15 182.16 182.17 182.18 182.19 182.20 182.21 182.22 182.23 182.24 182.25 182.26 182.27 182.28 182.29 182.30 182.31 182.32 182.33 182.34 182.35 182.36 183.1 183.2 183.3 183.4 183.5
183.6 183.7 183.8
183.9 183.10 183.11 183.12 183.13 183.14 183.15 183.16 183.17 183.18 183.19 183.20 183.21 183.22 183.23 183.24 183.25 183.26 183.27 183.28 183.29 183.30 183.31 183.32 183.33 183.34 183.35 184.1 184.2 184.3 184.4 184.5 184.6 184.7 184.8 184.9 184.10 184.11 184.12 184.13 184.14 184.15 184.16 184.17 184.18 184.19 184.20 184.21 184.22 184.23 184.24 184.25 184.26 184.27 184.28 184.29 184.30 184.31 184.32 184.33 184.34 184.35 184.36 185.1 185.2 185.3 185.4 185.5 185.6 185.7 185.8 185.9 185.10 185.11 185.12 185.13 185.14 185.15 185.16 185.17 185.18 185.19 185.20 185.21 185.22 185.23 185.24 185.25 185.26 185.27 185.28 185.29 185.30 185.31 185.32 185.33 185.34
185.35 185.36 186.1 186.2
186.3 186.4 186.5 186.6 186.7 186.8 186.9 186.10 186.11
186.12 186.13
186.14 186.15 186.16 186.17 186.18 186.19 186.20 186.21 186.22 186.23 186.24 186.25 186.26 186.27 186.28 186.29 186.30 186.31 186.32 186.33 186.34 187.1 187.2 187.3 187.4 187.5
187.6
187.7 187.8 187.9 187.10 187.11 187.12 187.13 187.14 187.15 187.16 187.17 187.18 187.19 187.20 187.21 187.22 187.23 187.24 187.25 187.26 187.27 187.28 187.29 187.30 187.31 187.32
187.33
188.1 188.2 188.3 188.4 188.5 188.6 188.7 188.8
188.9 188.10 188.11 188.12
188.13 188.14 188.15 188.16 188.17 188.18 188.19 188.20 188.21 188.22 188.23 188.24 188.25 188.26 188.27 188.28 188.29 188.30 188.31 188.32
188.33 188.34
189.1 189.2 189.3 189.4 189.5 189.6 189.7 189.8 189.9 189.10 189.11 189.12 189.13 189.14 189.15 189.16 189.17 189.18 189.19 189.20 189.21 189.22 189.23 189.24 189.25 189.26 189.27 189.28 189.29 189.30 189.31
189.32 189.33 189.34
190.1 190.2 190.3 190.4 190.5 190.6
190.7 190.8
190.9 190.10 190.11 190.12 190.13 190.14 190.15
190.16 190.17
190.18 190.19 190.20 190.21 190.22 190.23 190.24 190.25 190.26 190.27 190.28 190.29 190.30
190.31 190.32
191.1 191.2 191.3 191.4 191.5 191.6 191.7 191.8 191.9 191.10 191.11 191.12 191.13 191.14 191.15 191.16 191.17 191.18 191.19 191.20 191.21
191.22 191.23
191.24 191.25 191.26 191.27 191.28 191.29 191.30 191.31 191.32 191.33 191.34 191.35 192.1 192.2 192.3 192.4 192.5 192.6 192.7 192.8 192.9 192.10 192.11 192.12 192.13 192.14 192.15 192.16 192.17 192.18 192.19 192.20 192.21 192.22 192.23 192.24
192.25 192.26 192.27
192.28 192.29 192.30 192.31 192.32 192.33 192.34 193.1 193.2 193.3 193.4 193.5 193.6
193.7 193.8
193.9 193.10 193.11 193.12 193.13 193.14 193.15 193.16
193.17 193.18
193.19 193.20 193.21 193.22 193.23 193.24 193.25 193.26 193.27 193.28 193.29 193.30 193.31 194.1 194.2 194.3 194.4 194.5 194.6 194.7 194.8 194.9 194.10 194.11 194.12 194.13
194.14
194.15 194.16 194.17 194.18 194.19 194.20 194.21 194.22 194.23 194.24 194.25 194.26
194.27 194.28
194.29 194.30 194.31 194.32 194.33 195.1 195.2 195.3 195.4 195.5 195.6 195.7 195.8 195.9 195.10 195.11 195.12 195.13 195.14 195.15 195.16 195.17 195.18 195.19 195.20 195.21 195.22 195.23 195.24 195.25 195.26 195.27 195.28 195.29 195.30 195.31 195.32 195.33 195.34 195.35 196.1 196.2 196.3 196.4 196.5 196.6 196.7 196.8 196.9 196.10 196.11 196.12 196.13 196.14 196.15 196.16 196.17 196.18 196.19 196.20 196.21 196.22 196.23 196.24 196.25 196.26 196.27 196.28 196.29 196.30 196.31 196.32 196.33 196.34 196.35 196.36 197.1 197.2 197.3 197.4 197.5 197.6 197.7 197.8 197.9 197.10 197.11 197.12 197.13 197.14 197.15 197.16 197.17 197.18 197.19
197.20 197.21 197.22 197.23 197.24
197.25 197.26 197.27 197.28 197.29 197.30 197.31 197.32 197.33 197.34 198.1 198.2
198.3
198.4 198.5 198.6 198.7 198.8 198.9 198.10 198.11 198.12
198.13 198.14
198.15 198.16 198.17 198.18 198.19 198.20 198.21 198.22 198.23 198.24 198.25 198.26 198.27 198.28 198.29 198.30
198.31 198.32
199.1 199.2 199.3 199.4 199.5 199.6 199.7 199.8 199.9 199.10 199.11 199.12 199.13
199.14
199.15 199.16 199.17 199.18 199.19
199.20
199.21 199.22 199.23 199.24 199.25 199.26 199.27 199.28 199.29 199.30 199.31 199.32 199.33 200.1 200.2 200.3 200.4 200.5 200.6 200.7 200.8
200.9 200.10 200.11 200.12 200.13 200.14 200.15 200.16 200.17 200.18 200.19 200.20 200.21 200.22 200.23
200.24
200.25 200.26
200.27 200.28 200.29
200.30 200.31 200.32 201.1 201.2 201.3 201.4 201.5
201.6 201.7
201.8 201.9 201.10 201.11 201.12 201.13 201.14 201.15 201.16 201.17 201.18 201.19 201.20 201.21 201.22 201.23 201.24 201.25 201.26 201.27 201.28 201.29 201.30 201.31 201.32 201.33 201.34 201.35 202.1 202.2 202.3 202.4 202.5 202.6 202.7 202.8 202.9 202.10 202.11 202.12 202.13 202.14 202.15 202.16 202.17 202.18 202.19 202.20 202.21 202.22 202.23 202.24 202.25 202.26 202.27 202.28 202.29 202.30 202.31 202.32 202.33 202.34 202.35 202.36 203.1 203.2 203.3 203.4 203.5 203.6
203.7 203.8 203.9 203.10 203.11
203.12 203.13 203.14 203.15 203.16 203.17 203.18 203.19 203.20 203.21 203.22 203.23 203.24 203.25 203.26
203.27 203.28
203.29 203.30 203.31 203.32 203.33 204.1 204.2 204.3 204.4 204.5 204.6 204.7 204.8 204.9 204.10 204.11 204.12
204.13 204.14
204.15 204.16 204.17 204.18 204.19 204.20
204.21
204.22 204.23
204.24 204.25 204.26 204.27 204.28 204.29 204.30 204.31 204.32 204.33
205.1 205.2
205.3 205.4 205.5 205.6 205.7 205.8 205.9 205.10 205.11 205.12 205.13 205.14 205.15 205.16 205.17 205.18 205.19 205.20 205.21 205.22
205.23
205.24 205.25 205.26 205.27 205.28 205.29 205.30 205.31 205.32 205.33 206.1 206.2 206.3 206.4
206.5 206.6
206.7 206.8 206.9 206.10 206.11 206.12 206.13 206.14 206.15 206.16 206.17 206.18 206.19 206.20 206.21 206.22 206.23 206.24 206.25 206.26 206.27 206.28 206.29 206.30 206.31 206.32 206.33 206.34 207.1 207.2 207.3 207.4 207.5 207.6 207.7 207.8 207.9 207.10 207.11 207.12 207.13 207.14 207.15 207.16 207.17 207.18 207.19 207.20 207.21 207.22 207.23 207.24 207.25 207.26
207.27 207.28 207.29 207.30 207.31
207.32 207.33 208.1 208.2 208.3 208.4 208.5 208.6 208.7 208.8 208.9 208.10 208.11 208.12 208.13 208.14 208.15 208.16 208.17 208.18 208.19 208.20 208.21 208.22 208.23 208.24 208.25 208.26 208.27 208.28 208.29 208.30 208.31 208.32 208.33 208.34 208.35 208.36 209.1 209.2 209.3 209.4 209.5 209.6 209.7 209.8 209.9 209.10 209.11 209.12 209.13 209.14 209.15 209.16 209.17 209.18 209.19 209.20 209.21 209.22 209.23 209.24 209.25 209.26 209.27 209.28 209.29 209.30 209.31
209.32 209.33 209.34 209.35 210.1 210.2 210.3 210.4 210.5 210.6 210.7 210.8 210.9 210.10 210.11
210.12 210.13
210.14 210.15 210.16 210.17 210.18 210.19 210.20 210.21 210.22 210.23 210.24 210.25 210.26 210.27 210.28 210.29 210.30 210.31 210.32 210.33 210.34 210.35 211.1 211.2 211.3 211.4 211.5 211.6 211.7 211.8 211.9 211.10 211.11 211.12 211.13 211.14 211.15 211.16 211.17 211.18 211.19 211.20 211.21 211.22 211.23 211.24 211.25 211.26 211.27 211.28 211.29 211.30 211.31 211.32 211.33 211.34 212.1 212.2 212.3
212.4 212.5
212.6 212.7 212.8 212.9 212.10 212.11 212.12 212.13 212.14 212.15 212.16 212.17 212.18
212.19 212.20
212.21 212.22 212.23 212.24
212.25
212.26 212.27 212.28 212.29 212.30
212.31
213.1 213.2 213.3 213.4 213.5 213.6 213.7
213.8
213.9 213.10 213.11 213.12 213.13 213.14
213.15
213.16 213.17 213.18 213.19 213.20 213.21 213.22 213.23 213.24 213.25 213.26 213.27 213.28 213.29 213.30 213.31 213.32
213.33
214.1 214.2 214.3 214.4 214.5 214.6 214.7 214.8 214.9 214.10 214.11 214.12 214.13
214.14
214.15 214.16 214.17 214.18 214.19 214.20 214.21 214.22 214.23 214.24 214.25 214.26 214.27 214.28 214.29 214.30 214.31 214.32 214.33 214.34 215.1 215.2
215.3
215.4 215.5 215.6 215.7 215.8 215.9 215.10 215.11 215.12 215.13 215.14 215.15 215.16
215.17
215.18 215.19 215.20 215.21 215.22 215.23 215.24 215.25 215.26 215.27 215.28 215.29 215.30 215.31 215.32 215.33
216.1
216.2 216.3 216.4 216.5 216.6 216.7 216.8 216.9 216.10 216.11 216.12 216.13 216.14 216.15 216.16 216.17 216.18 216.19
216.20
216.21 216.22 216.23 216.24 216.25 216.26 216.27 216.28 216.29 216.30 216.31 216.32 216.33 217.1 217.2 217.3
217.4 217.5
217.6 217.7 217.8 217.9 217.10 217.11 217.12 217.13 217.14 217.15 217.16 217.17 217.18 217.19 217.20 217.21 217.22 217.23 217.24 217.25 217.26 217.27 217.28 217.29 217.30 217.31 217.32 217.33 218.1 218.2 218.3 218.4 218.5 218.6
218.7 218.8
218.9 218.10 218.11 218.12 218.13 218.14 218.15 218.16 218.17 218.18 218.19 218.20 218.21 218.22 218.23 218.24 218.25 218.26 218.27 218.28 218.29 218.30 218.31 218.32 218.33 218.34 219.1 219.2
219.3 219.4
219.5 219.6 219.7 219.8 219.9 219.10 219.11 219.12 219.13 219.14 219.15 219.16
219.17 219.18
219.19 219.20 219.21 219.22 219.23 219.24
219.25
219.26 219.27 219.28 219.29 219.30 219.31 220.1 220.2 220.3 220.4 220.5 220.6
220.7 220.8
220.9 220.10 220.11 220.12 220.13 220.14 220.15 220.16 220.17 220.18 220.19 220.20 220.21 220.22 220.23 220.24 220.25 220.26 220.27 220.28 220.29
220.30
220.31 220.32 221.1 221.2 221.3 221.4
221.5 221.6
221.7 221.8 221.9
221.10 221.11 221.12 221.13 221.14 221.15 221.16 221.17 221.18 221.19 221.20 221.21 221.22
221.23 221.24 221.25
221.26 221.27 221.28 221.29 221.30
221.31
222.1 222.2 222.3 222.4 222.5 222.6 222.7 222.8 222.9 222.10 222.11 222.12 222.13 222.14 222.15 222.16 222.17 222.18 222.19 222.20 222.21 222.22 222.23 222.24 222.25
222.26
222.27 222.28 222.29
222.30 222.31
222.32 223.1 223.2 223.3 223.4 223.5 223.6 223.7 223.8 223.9 223.10 223.11 223.12 223.13 223.14 223.15 223.16 223.17 223.18 223.19 223.20
223.21 223.22
223.23 223.24 223.25 223.26
223.27 223.28 223.29
223.30 223.31 223.32 223.33 224.1 224.2 224.3 224.4 224.5 224.6
224.7 224.8 224.9
224.10 224.11 224.12 224.13 224.14
224.15 224.16
224.17 224.18 224.19 224.20 224.21 224.22 224.23 224.24 224.25 224.26 224.27 224.28 224.29 224.30 224.31 224.32 224.33 225.1 225.2 225.3 225.4 225.5 225.6 225.7 225.8
225.9 225.10
225.11 225.12 225.13 225.14 225.15 225.16 225.17 225.18 225.19 225.20 225.21 225.22 225.23 225.24 225.25 225.26 225.27 225.28 225.29 225.30 225.31 225.32 225.33 225.34 226.1 226.2 226.3 226.4
226.5 226.6
226.7 226.8 226.9 226.10 226.11 226.12 226.13 226.14 226.15 226.16 226.17 226.18 226.19 226.20 226.21 226.22 226.23
226.24
226.25 226.26 226.27 226.28 226.29 226.30 226.31 226.32 227.1 227.2
227.3 227.4 227.5
227.6 227.7 227.8 227.9 227.10 227.11 227.12 227.13 227.14 227.15 227.16 227.17 227.18 227.19 227.20 227.21 227.22 227.23 227.24 227.25 227.26 227.27 227.28 227.29 227.30 227.31 227.32 227.33
228.1 228.2
228.3 228.4 228.5 228.6 228.7 228.8 228.9 228.10 228.11 228.12 228.13 228.14 228.15 228.16 228.17 228.18 228.19 228.20 228.21 228.22 228.23 228.24 228.25 228.26 228.27 228.28 228.29 228.30 228.31 228.32 228.33 228.34 228.35 229.1 229.2 229.3 229.4 229.5 229.6 229.7 229.8 229.9 229.10 229.11 229.12 229.13 229.14
229.15 229.16 229.17 229.18
229.19 229.20 229.21 229.22 229.23 229.24 229.25 229.26
229.27 229.28 229.29
229.30 229.31 230.1 230.2 230.3 230.4 230.5 230.6 230.7 230.8 230.9 230.10 230.11 230.12 230.13 230.14 230.15 230.16 230.17
230.18
230.19 230.20 230.21 230.22 230.23 230.24 230.25 230.26 230.27 230.28 230.29 230.30 230.31 230.32 230.33 230.34 231.1 231.2 231.3 231.4 231.5 231.6 231.7 231.8 231.9 231.10 231.11 231.12 231.13 231.14 231.15 231.16 231.17 231.18 231.19 231.20 231.21 231.22 231.23 231.24 231.25 231.26 231.27 231.28 231.29 231.30 231.31 231.32 231.33 231.34 231.35 232.1 232.2 232.3 232.4 232.5 232.6 232.7 232.8 232.9 232.10 232.11 232.12 232.13
232.14 232.15 232.16 232.17
232.18 232.19 232.20 232.21 232.22 232.23 232.24 232.25 232.26 232.27 232.28 232.29 232.30 232.31 232.32 232.33 233.1 233.2 233.3 233.4 233.5 233.6
233.7 233.8 233.9
233.10 233.11 233.12 233.13 233.14 233.15 233.16 233.17 233.18 233.19 233.20 233.21 233.22 233.23 233.24
233.25
233.26 233.27 233.28 233.29 233.30
233.31
233.32 234.1 234.2 234.3 234.4 234.5 234.6 234.7 234.8 234.9
234.10
234.11 234.12 234.13 234.14 234.15 234.16 234.17 234.18 234.19 234.20 234.21 234.22 234.23 234.24 234.25 234.26 234.27 234.28 234.29 234.30 234.31 234.32 234.33
234.34
235.1 235.2 235.3 235.4 235.5 235.6 235.7 235.8 235.9 235.10 235.11 235.12 235.13 235.14 235.15 235.16 235.17 235.18 235.19 235.20 235.21
235.22
235.23 235.24 235.25 235.26 235.27 235.28 235.29 235.30 235.31 235.32 235.33 236.1 236.2 236.3 236.4 236.5 236.6 236.7 236.8 236.9 236.10
236.11 236.12
236.13 236.14 236.15 236.16 236.17 236.18 236.19 236.20 236.21 236.22 236.23 236.24 236.25 236.26 236.27
236.28
236.29 236.30 236.31 236.32 236.33 237.1 237.2
237.3 237.4 237.5
237.6 237.7 237.8 237.9 237.10 237.11 237.12 237.13 237.14 237.15 237.16 237.17 237.18 237.19 237.20 237.21 237.22 237.23 237.24 237.25 237.26 237.27 237.28
237.29 237.30 237.31 237.32 237.33
238.1 238.2 238.3 238.4
238.5 238.6
238.7 238.8 238.9 238.10 238.11 238.12 238.13 238.14
238.15
238.16 238.17 238.18 238.19 238.20 238.21 238.22 238.23 238.24 238.25 238.26 238.27 238.28 238.29 238.30 238.31 238.32 239.1 239.2 239.3 239.4 239.5 239.6 239.7 239.8 239.9 239.10 239.11 239.12 239.13 239.14 239.15 239.16 239.17 239.18 239.19 239.20 239.21 239.22 239.23 239.24 239.25 239.26 239.27 239.28 239.29 239.30 239.31 239.32 239.33 239.34 239.35 239.36 240.1 240.2 240.3 240.4 240.5 240.6 240.7 240.8 240.9 240.10 240.11 240.12 240.13 240.14 240.15
240.16
240.17 240.18 240.19 240.20 240.21 240.22 240.23 240.24 240.25
240.26
240.27 240.28 240.29 240.30 240.31 240.32 240.33 241.1 241.2 241.3 241.4 241.5 241.6 241.7 241.8 241.9 241.10 241.11 241.12 241.13 241.14 241.15 241.16 241.17 241.18 241.19 241.20 241.21 241.22 241.23 241.24 241.25 241.26 241.27 241.28 241.29 241.30 241.31 241.32 241.33 241.34
241.35 241.36
242.1 242.2 242.3 242.4 242.5 242.6 242.7 242.8 242.9 242.10 242.11 242.12 242.13 242.14 242.15
242.16 242.17
242.18 242.19 242.20 242.21 242.22 242.23 242.24 242.25 242.26 242.27 242.28 242.29 242.30 242.31 242.32 242.33
243.1 243.2
243.3 243.4 243.5 243.6 243.7 243.8 243.9 243.10 243.11 243.12 243.13 243.14 243.15 243.16 243.17 243.18 243.19 243.20 243.21 243.22 243.23 243.24 243.25 243.26 243.27 243.28 243.29 243.30 243.31 243.32 243.33 243.34
244.1 244.2
244.3 244.4 244.5 244.6 244.7 244.8 244.9 244.10 244.11 244.12 244.13 244.14 244.15 244.16 244.17 244.18 244.19 244.20 244.21 244.22 244.23 244.24 244.25 244.26 244.27 244.28 244.29 244.30 244.31 244.32 244.33 244.34 244.35
245.1 245.2
245.3 245.4 245.5 245.6 245.7 245.8 245.9 245.10 245.11 245.12 245.13 245.14 245.15 245.16 245.17 245.18 245.19 245.20 245.21 245.22 245.23 245.24 245.25 245.26 245.27
245.28 245.29
245.30 245.31 245.32 245.33 245.34 246.1 246.2 246.3 246.4 246.5 246.6 246.7 246.8 246.9 246.10 246.11 246.12 246.13 246.14 246.15 246.16
246.17 246.18
246.19 246.20 246.21 246.22 246.23 246.24 246.25 246.26 246.27 246.28 246.29 246.30 246.31 246.32 246.33 246.34
247.1 247.2
247.3 247.4 247.5 247.6 247.7 247.8 247.9 247.10 247.11 247.12 247.13 247.14 247.15 247.16 247.17 247.18 247.19
247.20 247.21 247.22 247.23 247.24 247.25 247.26 247.27
247.28 247.29
247.30 247.31 247.32 247.33 248.1 248.2 248.3 248.4 248.5 248.6 248.7 248.8 248.9 248.10 248.11 248.12 248.13 248.14 248.15 248.16 248.17 248.18 248.19 248.20 248.21 248.22 248.23 248.24 248.25 248.26 248.27 248.28 248.29 248.30 248.31 248.32 248.33 248.34 248.35 248.36 249.1 249.2 249.3 249.4 249.5 249.6 249.7 249.8 249.9 249.10 249.11 249.12 249.13 249.14 249.15 249.16 249.17 249.18 249.19 249.20 249.21 249.22 249.23 249.24 249.25 249.26 249.27 249.28 249.29 249.30 249.31 249.32 249.33 249.34 249.35 249.36 250.1 250.2 250.3 250.4 250.5 250.6 250.7 250.8 250.9 250.10 250.11 250.12 250.13 250.14 250.15 250.16 250.17 250.18 250.19 250.20 250.21 250.22 250.23 250.24 250.25 250.26 250.27 250.28 250.29 250.30 250.31 250.32 250.33 250.34 250.35 251.1 251.2 251.3 251.4 251.5 251.6 251.7
251.8
251.9 251.10 251.11 251.12 251.13
251.14 251.15
251.16 251.17 251.18 251.19 251.20 251.21 251.22 251.23 251.24 251.25 251.26 251.27 251.28 251.29 251.30 251.31 251.32
252.1 252.2 252.3 252.4 252.5 252.6 252.7 252.8 252.9 252.10 252.11 252.12 252.13 252.14 252.15 252.16 252.17
252.18
252.19 252.20 252.21 252.22 252.23 252.24 252.25 252.26 252.27 252.28 252.29 252.30 252.31
252.32
252.33 253.1 253.2 253.3 253.4 253.5 253.6 253.7 253.8 253.9
253.10 253.11 253.12 253.13 253.14 253.15
253.16 253.17 253.18 253.19 253.20 253.21 253.22 253.23 253.24 253.25 253.26 253.27 253.28 253.29
253.30 253.31
253.32 254.1 254.2 254.3 254.4 254.5 254.6 254.7
254.8 254.9 254.10 254.11 254.12 254.13
254.14 254.15 254.16 254.17 254.18 254.19
254.20 254.21 254.22 254.23 254.24 254.25 254.26 254.27
254.28 254.29 254.30 254.31 255.1 255.2
255.3 255.4 255.5 255.6 255.7 255.8 255.9 255.10 255.11 255.12 255.13 255.14 255.15 255.16 255.17 255.18 255.19 255.20 255.21
255.22 255.23 255.24 255.25 255.26 255.27 255.28 255.29 255.30 255.31 255.32 255.33 256.1 256.2 256.3 256.4 256.5 256.6 256.7 256.8 256.9 256.10 256.11 256.12 256.13 256.14 256.15 256.16 256.17 256.18 256.19 256.20 256.21 256.22 256.23 256.24 256.25 256.26 256.27 256.28 256.29 256.30 256.31 256.32 256.33 256.34
257.1 257.2 257.3
257.4 257.5 257.6 257.7 257.8 257.9 257.10 257.11 257.12 257.13 257.14 257.15 257.16 257.17
257.18
257.19 257.20 257.21 257.22 257.23 257.24 257.25 257.26 257.27 257.28 257.29 257.30 257.31 257.32 257.33 258.1 258.2 258.3 258.4 258.5 258.6 258.7 258.8 258.9 258.10 258.11 258.12 258.13 258.14 258.15 258.16 258.17 258.18 258.19 258.20 258.21 258.22 258.23 258.24 258.25 258.26 258.27 258.28 258.29 258.30 258.31
258.32 258.33
258.34 259.1 259.2 259.3 259.4 259.5 259.6 259.7 259.8 259.9 259.10
259.11
259.12 259.13 259.14 259.15 259.16 259.17 259.18 259.19 259.20 259.21 259.22 259.23 259.24 259.25 259.26 259.27 259.28 259.29 259.30 259.31 259.32 259.33 259.34 259.35 260.1 260.2 260.3 260.4 260.5 260.6 260.7 260.8 260.9
260.10 260.11 260.12 260.13 260.14 260.15 260.16 260.17 260.18 260.19 260.20 260.21 260.22 260.23 260.24 260.25 260.26 260.27 260.28 260.29 260.30
260.31 260.32
260.33 261.1 261.2 261.3 261.4 261.5 261.6 261.7 261.8 261.9 261.10 261.11 261.12 261.13 261.14 261.15 261.16
261.17 261.18 261.19 261.20 261.21 261.22 261.23
261.24
261.25 261.26 261.27 261.28 261.29 261.30 261.31 261.32 261.33 262.1 262.2 262.3 262.4 262.5 262.6 262.7 262.8 262.9 262.10 262.11 262.12 262.13 262.14 262.15 262.16 262.17 262.18 262.19 262.20 262.21 262.22 262.23 262.24 262.25
262.26 262.27
262.28 262.29 262.30 262.31 262.32 262.33 262.34 262.35 263.1 263.2 263.3 263.4
263.5 263.6
263.7 263.8 263.9 263.10 263.11 263.12 263.13
263.14
263.15 263.16 263.17 263.18 263.19 263.20 263.21 263.22 263.23 263.24 263.25 263.26 263.27 263.28 263.29 263.30 263.31 263.32 263.33 264.1 264.2 264.3 264.4 264.5
264.6 264.7
264.8 264.9 264.10 264.11 264.12 264.13 264.14 264.15 264.16 264.17 264.18 264.19 264.20 264.21 264.22 264.23 264.24 264.25 264.26 264.27 264.28 264.29 264.30 264.31 264.32 264.33 264.34 265.1 265.2 265.3 265.4 265.5 265.6 265.7 265.8 265.9 265.10 265.11 265.12 265.13 265.14 265.15 265.16 265.17 265.18 265.19 265.20 265.21 265.22 265.23 265.24 265.25 265.26 265.27 265.28 265.29 265.30 265.31 265.32 265.33 265.34 265.35 265.36 266.1 266.2 266.3 266.4
266.5 266.6 266.7 266.8
266.9 266.10
266.11 266.12 266.13 266.14 266.15 266.16 266.17 266.18 266.19 266.20 266.21 266.22 266.23 266.24 266.25 266.26 266.27 266.28 266.29 266.30 266.31 266.32 266.33 266.34 267.1 267.2 267.3 267.4 267.5 267.6 267.7 267.8 267.9 267.10 267.11
267.12
267.13 267.14 267.15 267.16 267.17 267.18 267.19 267.20 267.21 267.22 267.23 267.24 267.25 267.26 267.27 267.28 267.29 267.30 267.31 267.32 267.33 267.34 267.35 268.1 268.2 268.3 268.4 268.5 268.6 268.7
268.8
268.9 268.10 268.11 268.12 268.13 268.14 268.15 268.16 268.17 268.18 268.19 268.20 268.21
268.22
268.23 268.24 268.25 268.26 268.27 268.28 268.29 268.30 268.31 268.32 268.33 269.1 269.2 269.3
269.4
269.5 269.6 269.7 269.8 269.9 269.10 269.11 269.12 269.13 269.14 269.15 269.16 269.17 269.18 269.19 269.20 269.21 269.22 269.23 269.24 269.25 269.26 269.27 269.28 269.29 269.30 269.31 269.32 269.33 269.34 269.35 270.1 270.2 270.3 270.4 270.5 270.6 270.7 270.8 270.9 270.10 270.11 270.12 270.13 270.14 270.15 270.16 270.17 270.18 270.19 270.20 270.21 270.22 270.23 270.24 270.25 270.26 270.27 270.28 270.29 270.30 270.31 270.32 270.33 270.34 270.35 271.1 271.2 271.3 271.4 271.5 271.6 271.7 271.8 271.9 271.10 271.11 271.12 271.13
271.14
271.15 271.16 271.17 271.18
271.19 271.20 271.21 271.22 271.23 271.24 271.25 271.26 271.27 271.28 271.29
271.30 271.31 271.32 272.1 272.2 272.3 272.4
A bill for an act
relating to financing and operation of government in this state; modifying truth in
taxation provisions and adding a taxpayer satisfaction survey; changing income,
corporate franchise, withholding, estate, property, sales and use, mortgage
registry, health care gross revenues, motor fuels, gambling, cigarette and tobacco
products, occupation, net proceeds, production, liquor, insurance, and other taxes
and tax-related provisions; making technical, clarifying, collection, enforcement,
refund, and administrative changes to certain taxes and tax-related provisions,
tax-forfeited lands, revenue recapture, unfair cigarette sales, state debt collection,
sustainable forest incentive programs, and payments in lieu of taxes; changing
local government aids and credits; providing for determination of population for
certain purposes; updating references to the Internal Revenue Code, changing
property tax exemptions, homesteads, assessment, valuation, classification, class
rates, levies, deferral, review and equalization, appeals, notices and statements,
and distribution provisions; changing rent constituting property taxes and
property tax refunds; requiring state contracts be with vendors registered to
collect use taxes; abolishing the political contribution refund; authorizing local
sales taxes; extending a sales tax expiration; providing for compliance with
streamlined sales tax agreement; changing the taxation of liquor and cigarettes;
authorizing income tax checkoffs; requiring registration of tax shelters and
providing for a voluntary compliance initiative; changing job opportunity
building zones, border city development zones, biotechnology and health
sciences industry zone provisions; setting minimum employee compensation
for qualifying business in a JOBZ; limiting sales tax construction exemption
in job zones to businesses paying prevailing wage; requiring a referendum
for certain subsidies to gambling enterprises; authorizing charges for certain
emergency services; imposing a franchise fee on card clubs; defining the term
"tax"; regulating tax preparers; suspending appropriations or aids to public
employers who prohibit certain employees from wearing a flag on a uniform;
providing for training and conduct of assessors; prohibiting purchases of
tax-forfeited lands by certain local officials; providing for data classification and
exchange of data; establishing a tax reform commission; providing and imposing
powers and duties on the commissioner of revenue and other state agencies and
departments and on certain political subdivisions and certain officials; changing
and imposing penalties; requiring reports; transferring funds; appropriating
money; amending Minnesota Statutes 2004, sections 4A.02; 16C.03, by adding a
subdivision; 16D.10; 168A.05, subdivision 1a; 190.09, subdivision 2; 240.30,
by adding a subdivision; 270.02, subdivision 3; 270.11, subdivision 2; 270.16,
subdivision 2; 270.30, subdivisions 1, 5, 6, 8, by adding subdivisions; 270.65;
270.67, subdivision 4; 270.69, subdivision 4; 270A.03, subdivisions 5, 7; 272.01,
subdivision 2; 272.02, subdivisions 1a, 7, 47, 53, 64, by adding subdivisions;
272.0211, subdivisions 1, 2; 272.0212, subdivisions 1, 2; 272.029, subdivisions
4, 6; 273.055; 273.0755; 273.11, subdivisions 1a, 8, by adding subdivisions;
273.111, by adding a subdivision; 273.123, subdivision 7; 273.124, subdivisions
3, 6, 8, 14, 21; 273.125, subdivision 8; 273.13, subdivisions 22, 23, 25, by
adding a subdivision; 273.1315; 273.1384, subdivision 1; 273.19, subdivision
1a; 273.372; 274.01, subdivision 1; 274.014, subdivisions 2, 3; 274.14; 275.025,
subdivision 4; 275.065, subdivisions 1c, 3, 4, 7, by adding subdivisions;
275.07, subdivisions 1, 4; 276.04, subdivision 2; 276.112; 276A.01, subdivision
7; 282.016; 282.08; 282.15; 282.21; 282.224; 282.301; 287.04; 289A.02,
subdivision 7; 289A.08, subdivisions 1, 3, 7, 13, 16; 289A.18, subdivision
1; 289A.19, subdivision 4; 289A.20, subdivision 2; 289A.31, subdivision 2;
289A.37, subdivision 5; 289A.38, subdivisions 6, 7, by adding subdivisions;
289A.40, subdivision 2, by adding subdivisions; 289A.50, subdivisions 1, 1a;
289A.56, by adding a subdivision; 289A.60, subdivisions 2a, 4, 6, 7, 11, 13, 20,
by adding subdivisions; 290.01, subdivisions 6, 7, 7b, 19, as amended, 19a,
19b, 19c, 19d, 31; 290.032, subdivisions 1, 2; 290.06, subdivisions 2c, 22, by
adding a subdivision; 290.067, subdivisions 1, 2a; 290.0671, subdivisions 1, 1a;
290.0672, subdivisions 1, 2; 290.0674, subdivisions 1, 2; 290.0675, subdivision
1; 290.091, subdivisions 2, 3; 290.0922, subdivision 2; 290.191, subdivisions
2, 3; 290.92, subdivisions 1, 4b; 290A.03, subdivisions 3, 11, 13, 15, by adding
subdivisions; 290A.07, by adding a subdivision; 290A.19; 290B.05, subdivision
3; 290C.05; 290C.10; 291.005, subdivision 1; 291.03, subdivision 1; 295.52,
subdivision 4; 295.53, subdivision 1; 295.582; 295.60, subdivision 3; 296A.22,
by adding a subdivision; 297A.61, subdivisions 3, 4, by adding a subdivision;
297A.64, subdivision 4; 297A.668, subdivisions 1, 5; 297A.67, subdivisions 2,
7, 9, 29, by adding a subdivision; 297A.68, subdivisions 2, 5, 28, 35, 37, 38, 39,
by adding subdivisions; 297A.70, subdivision 10; 297A.71, subdivision 12, by
adding a subdivision; 297A.72, by adding a subdivision; 297A.75, subdivision
1; 297A.87, subdivisions 2, 3; 297A.99, subdivisions 1, 3, 4, 9, by adding
subdivisions; 297E.01, subdivisions 5, 7, by adding subdivisions; 297E.06,
subdivision 2; 297E.07; 297F.08, subdivision 12, by adding a subdivision;
297F.09, subdivisions 1, 2; 297F.14, subdivision 4; 297G.09, by adding a
subdivision; 297I.01, by adding subdivisions; 297I.05, subdivisions 4, 5, by
adding a subdivision; 298.01, subdivisions 3, 4; 298.24, subdivision 1; 298.75,
by adding a subdivision; 325D.33, subdivision 6; 365.43, subdivision 1; 365.431;
366.011; 366.012; 373.45, subdivision 7; 469.169, by adding a subdivision;
469.1735, subdivision 3; 469.176, subdivisions 4l, 7; 469.310, subdivision 11,
by adding a subdivision; 469.315; 469.316; 469.317; 469.319, subdivision 1, by
adding a subdivision; 469.320, subdivision 3; 469.330, subdivision 11; 469.335;
469.337; 469.340, subdivision 1; 473.843, subdivision 5; 473F.02, subdivisions
2, 7; 477A.011, subdivisions 3, 34, 35, 36, 38; 477A.0124, subdivisions 2, 4;
477A.013, subdivisions 8, 9, by adding a subdivision; 477A.016; 477A.03,
subdivisions 2a, 2b; 477A.11, subdivision 4, by adding a subdivision; 477A.12,
subdivisions 1, 2; 477A.14, subdivision 1; 645.44, by adding a subdivision; Laws
1998, chapter 389, article 3, section 42, subdivision 2, as amended; Laws 1998,
chapter 389, article 8, section 43, subdivision 3; Laws 2001, First Special Session
chapter 5, article 3, section 8; Laws 2001, First Special Session chapter 5, article
12, section 95, as amended; Laws 2002, chapter 377, article 3, section 4; Laws
2003, chapter 127, article 5, section 27; Laws 2003, chapter 127, article 5, section
28; Laws 2003, First Special Session chapter 21, article 5, section 13; Laws
2003, First Special Session chapter 21, article 6, section 9; Laws 2005, chapter
43, section 1; proposing coding for new law in Minnesota Statutes, chapters 15;
270; 272; 273; 275; 280; 289A; 290; 290C; 295; 297A; 297F; 373; 459; 473;
repealing Minnesota Statutes 2004, sections 10A.322, subdivision 4; 16A.1522,
subdivision 4; 270.85; 270.88; 272.02, subdivision 65; 273.19, subdivision
5; 273.37, subdivision 3; 274.05; 275.065, subdivisions 5a, 6, 6b, 8; 275.15;
275.61, subdivision 2; 283.07; 290.06, subdivision 23; 297E.12, subdivision 10;
469.1794, subdivision 6; 477A.08; Laws 1975, chapter 287, section 5; Laws
1998, chapter 389, article 3, section 41; Laws 2003, chapter 127, article 9, section
9, subdivision 4; Minnesota Rules, parts 8093.2000; 8093.3000; 8130.0110,
subpart 4; 8130.0200, subparts 5, 6; 8130.0400, subpart 9; 8130.1200, subparts
5, 6; 8130.2900; 8130.3100, subpart 1; 8130.4000, subparts 1, 2; 8130.4200,
subpart 1; 8130.4400, subpart 3; 8130.5200; 8130.5600, subpart 3; 8130.5800,
subpart 5; 8130.7300, subpart 5; 8130.8800, subpart 4.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
ARTICLE 1
TAXPAYER SATISFACTION SURVEY
Section 1.
new text begin
[275.063] PROPOSED PROPERTY TAXES; TAXPAYER
SATISFACTION SURVEY; DEFINITIONS.
new text end
new text begin Subdivision 1. new text end
new text begin Definitions. new text end
new text begin
For the purposes of this section and section 275.065,
the following definitions apply.
new text end
new text begin Subd. 2. new text end
new text begin Budget; counties. new text end
new text begin
For counties, "budget" means total government fund
expenditures, as defined by the state auditor under section 375.169, less any expenditures
for direct payments to recipients or providers for the human service aids listed below:
new text end
new text begin
(1) Minnesota family investment program under chapters 256J and 256K;
new text end
new text begin
(2) medical assistance under sections 256B.041, subdivision 5, and 256B.19,
subdivision 1;
new text end
new text begin
(3) general assistance medical care under section 256D.03, subdivision 6;
new text end
new text begin
(4) general assistance under section 256D.03, subdivision 2;
new text end
new text begin
(5) Minnesota supplemental aid under section 256D.36, subdivision 1;
new text end
new text begin
(6) preadmission screening under section 256B.0911, and alternative care grants
under section 256B.0913;
new text end
new text begin
(7) general assistance medical care claims processing, medical transportation, and
related costs under section 256D.03, subdivision 4;
new text end
new text begin
(8) medical transportation and related costs under section 256B.0625, subdivisions
17 to 18a;
new text end
new text begin
(9) group residential housing under section 256I.05, subdivision 8, transferred from
programs in clauses (4) and (5); or
new text end
new text begin
(10) any successor programs to those listed in clauses (1) to (9).
new text end
new text begin Subd. 3. new text end
new text begin Budget; cities. new text end
new text begin
For cities, "budget" means total government fund
expenditures, as defined by the state auditor under section 471.6965, less any expenditures
for improvements or services that are specially assessed or charged under chapter 429,
430, 435, or the provisions of any other law or charter.
new text end
new text begin Subd. 4. new text end
new text begin Population. new text end
new text begin
"Population" of a city means the most recent population as
determined by the state demographer under section 4A.02 or by the Metropolitan Council
under section 477A.011, subdivision 3.
new text end
new text begin Subd. 5. new text end
new text begin Property tax levy subject to approval; counties and cities. new text end
new text begin
For a county
or a city, "property tax levy subject to approval" means the jurisdiction's levy excluding
any debt levy and any levy previously approved by the voters.
new text end
new text begin Subd. 6. new text end
new text begin Debt levy. new text end
new text begin
"Debt levy" means a levy to:
new text end
new text begin
(1) pay the costs of principal and interest on bonded indebtedness;
new text end
new text begin
(2) pay the costs of principal and interest on certificates of indebtedness issued
for any corporate purpose except:
new text end
new text begin
(i) tax anticipation or aid anticipation certificates of indebtedness;
new text end
new text begin
(ii) certificates of indebtedness issued under sections 298.28 and 298.282;
new text end
new text begin
(iii) certificates of indebtedness used to fund current expenses; or
new text end
new text begin
(iv) certificates of indebtedness used to fund an insufficiency in tax receipts or
an insufficiency in other revenue sources.
new text end
new text begin
(3) pay another city, town, county, or school district for principal and interest on
general obligation debt; or
new text end
new text begin
(4) fund payments made to the Minnesota State Armory Building Commission under
section 193.145, subdivision 2, to retire the principal and interest on armory construction
bonds.
new text end
new text begin Subd. 7. new text end
new text begin State property tax credits. new text end
new text begin
"State property tax credits" means any credits
received under sections 273.119; 273.123; 273.135; 273.1384; 273.1391; 273.1398,
subdivision 4; 469.171; and 473H.10.
new text end
new text begin Subd. 8. new text end
new text begin Jurisdiction subject to taxpayer satisfaction survey. new text end
new text begin
A "jurisdiction
subject to the taxpayer satisfaction survey" means any county or any city with a population
of 500 or greater.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes payable in 2006 and
subsequent years.
new text end
Sec. 2.
Minnesota Statutes 2004, section 275.065, subdivision 1c, is amended to read:
Subd. 1c.
Levy; shared, merged, consolidated services.
If two or more taxing
authorities are in the process of negotiating an agreement for sharing, merging, or
consolidating services between those taxing authorities at the time the proposed levy is to
be certified under subdivision 1, each taxing authority involved in the negotiation shall
certify its total proposed levy as provided in that subdivision, including a notification to the
county auditor of the specific service involved in the agreement which is not yet finalized.
The affected taxing authorities may amend their proposed levies under subdivision 1 until
October deleted text begin 10 deleted text end new text begin 1 new text end for levy amounts relating only to the specific service involved.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes payable in 2006 and
subsequent years.
new text end
Sec. 3.
Minnesota Statutes 2004, section 275.065, subdivision 3, is amended to read:
Subd. 3.
Notice of proposed property taxes.
(a) The county auditor shall prepare
and the county treasurer shall deliver after November deleted text begin 10 deleted text end new text begin 8 new text end and on or before November
deleted text begin 24 deleted text end new text begin 19 new text end each year, by first class mail to each taxpayer at the address listed on the county's
current year's assessment roll, a notice of proposed property taxes.
(b) The commissioner of revenue shall prescribe the form of the notice. new text begin The form
must be in the form prescribed by the commissioner.
new text end
(c) The notice must inform taxpayers that it contains the amount of property taxes
each taxing authority proposes to collect for taxes payable the following year. In the case
of a town, or in the case of the state general tax, the final tax amount will be its proposed
tax new text begin unless the town changes its levy at a special town meeting under section 365.52new text end .
deleted text begin In the case of taxing authorities required to hold a public meeting under subdivision 6,
the notice must clearly state that each taxing authority, including regional library districts
established under section 134.201, and including the metropolitan taxing districts as
defined in paragraph (i), but excluding all other special taxing districts and towns, will
hold a public meeting to receive public testimony on the proposed budget and proposed or
final property tax levy, or, in case of a school district, on the current budget and proposed
property tax levy. It must clearly state the time and place of each taxing authority's
meeting, a telephone number for the taxing authority that taxpayers may call if they have
questions related to the notice, and an address where comments will be received by mail.
deleted text end
(d) The notice must state for each parceldeleted text begin :
deleted text end
deleted text begin (1) deleted text end the market value of the property as determined under section 273.11, and used
for computing property taxes payable in the following year and for taxes payable in the
current year as each appears in the records of the county assessor on November 1 of the
current year; and, in the case of residential property, whether the property is classified as
homestead or nonhomestead. The notice must clearly inform taxpayers of the years to
which the market values apply and that the values are final valuesdeleted text begin ;deleted text end new text begin .
new text end
deleted text begin (2) deleted text end new text begin (e) new text end The deleted text begin items listed below, shown separately by deleted text end new text begin notice must state for each parcel,
for both taxes payable in the current year and the proposed taxes payable in the following
year each of the following tax amounts, net of state property tax credits:new text end county new text begin taxnew text end , city or
town new text begin taxnew text end , deleted text begin and deleted text end state deleted text begin general deleted text end tax, deleted text begin net of the residential and agricultural homestead credit
under section 273.1384,deleted text end voter approved school deleted text begin levy deleted text end new text begin taxnew text end , other deleted text begin local deleted text end school deleted text begin levy deleted text end new text begin taxnew text end , deleted text begin and
deleted text end the sum of the new text begin tax amounts for all new text end special taxing districts, new text begin the sum of the tax increment tax
on captured tax capacity, if applicable, and the fiscal disparities areawide tax under chapter
276A or 473F, if applicable,new text end and deleted text begin as a deleted text end new text begin the new text end total deleted text begin of deleted text end new text begin tax amount for new text end all taxing authoritiesdeleted text begin :
deleted text end
deleted text begin
(i) the actual tax for taxes payable in the current year; and
deleted text end
deleted text begin (ii) the proposed tax amountdeleted text end .
deleted text begin
If the county levy under clause (2) includes an amount for a lake improvement
district as defined under sections 103B.501 to 103B.581, the amount attributable for that
purpose must be separately stated from the remaining county levy amount.
deleted text end
deleted text begin
In the case of a town or the state general tax, the final tax shall also be its proposed
tax unless the town changes its levy at a special town meeting under section 365.52. If a
school district has certified under section 126C.17, subdivision 9, that a referendum will
be held in the school district at the November general election, the county auditor must
note next to the school district's proposed amount that a referendum is pending and that, if
approved by the voters, the tax amount may be higher than shown on the notice. In the
case of the city of Minneapolis, the levy for the Minneapolis Library Board and the levy
for Minneapolis Park and Recreation shall be listed separately from the remaining amount
of the city's levy. In the case of the city of St. Paul, the levy for the St. Paul Library
Agency must be listed separately from the remaining amount of the city's levy. In the
case of a parcel where tax increment or the fiscal disparities areawide tax under chapter
276A or 473F applies, the proposed tax levy on the captured value or the proposed tax
levy on the tax capacity subject to the areawide tax must each be stated separately and
not included in the sum of the special taxing districts; and
deleted text end
deleted text begin
(3) the increase or decrease between the total taxes payable in the current year and
the total proposed taxes, expressed as a percentage.
deleted text end
new text begin
(f) The notice must state for each parcel the increase or decrease between the total
taxes payable in the current year and the total proposed taxes, expressed as a percentage.
new text end
new text begin
(g) The notice must state for each parcel an estimate of any additional tax that would
apply to the property under any referenda pending at the November general election. Any
amount shown under this item should be indicated as pending the results of referendum
elections, and shall not be reflected in the total proposed net tax amount.
new text end
new text begin (h) new text end For purposes of this section, the amount of the tax on homesteads qualifying
under the senior citizens' property tax deferral program under chapter 290B is the total
amount of property tax before subtraction of the deferred property tax amount.
deleted text begin (e) deleted text end new text begin (i) new text end The notice must clearly state that the proposed or final taxes do not include
the following:
(1) special assessments;
(2) levies approved by the voters after the date new text begin of new text end thedeleted text begin proposed taxes are certified,
including bond referenda and school district levy referenda deleted text end new text begin November general electionnew text end ;
(3) deleted text begin a levy limit increase approved by the voters by the first Tuesday after the first
Monday in November of the levy year as provided under section 275.73;
deleted text end
deleted text begin (4) deleted text end amounts necessary to pay cleanup or other costs due to a natural disaster
occurring after the date the proposed taxes are certified;
deleted text begin (5) deleted text end new text begin (4) new text end amounts necessary to pay tort judgments against the taxing authority that
become final after the date the proposed taxes are certified; and
deleted text begin (6) deleted text end new text begin (5) new text end the contamination tax imposed on properties which received market value
reductions for contamination.
deleted text begin (f) deleted text end new text begin (j) new text end Except as provided in subdivision 7, failure of the county auditor to prepare or
the county treasurer to deliver the notice as required in this section does not invalidate the
proposed or final tax levy or the taxes payable pursuant to the tax levy.
deleted text begin
(g) If the notice the taxpayer receives under this section lists the property as
nonhomestead, and satisfactory documentation is provided to the county assessor by the
applicable deadline, and the property qualifies for the homestead classification in that
assessment year, the assessor shall reclassify the property to homestead for taxes payable
in the following year.
deleted text end
deleted text begin (h) deleted text end new text begin (k) new text end In the case of class 4 residential property used as a residence for lease or
rental periods of 30 days or more, the taxpayer must deleted text begin either: (1) deleted text end mail or deliver a copy
of the notice of proposed property taxes new text begin and the taxpayer satisfaction survey new text end to each
tenant, renter, or lesseedeleted text begin ; or deleted text end new text begin .
new text end
deleted text begin
(2) post a copy of the notice in a conspicuous place on the premises of the property.
deleted text end
The new text begin copy of the new text end notice must be mailed deleted text begin or posted deleted text end by the taxpayer by November deleted text begin 27 deleted text end new text begin 22
new text end or within three days of receipt of the notice, whichever is later. A taxpayer may notify the
county treasurer of the address of the taxpayer, agent, caretaker, or manager of the premises
to which the notice must be mailed in order to fulfill the requirements of this paragraph.
deleted text begin (i) deleted text end new text begin (l) new text end For purposes of deleted text begin this subdivision, subdivisions 5a and 6 deleted text end new text begin section 276.04new text end ,
"metropolitan special taxing districts" means the following taxing districts in the
seven-county metropolitan area that levy a property tax for any of the specified purposes
listed below:
(1) Metropolitan Council under section 473.132, 473.167, 473.249, 473.325,
473.446, 473.521, 473.547, or 473.834;
(2) Metropolitan Airports Commission under section 473.667, 473.671, or 473.672;
and
(3) Metropolitan Mosquito Control Commission under section 473.711.
new text begin (m) new text end For purposes of this section, any levies made by the regional rail authorities
in the county of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under
chapter 398A shall be included with the appropriate county's levy and shall be discussed
at new text begin one of new text end that county's deleted text begin public hearing deleted text end new text begin regularly scheduled board meetingsnew text end .
new text begin
(n) The governing body of a county, city, or school district may, with the county
auditor's consent, include supplemental information with the statement of proposed
property taxes about the impact of state aid increases or decreases on property tax
increases or decreases and on the level of services provided in the affected jurisdiction.
This supplemental information may include information for the following year, the current
year, and for as many consecutive preceding years as deemed appropriate by the governing
body of the county, city, or school district. It may include only information regarding:
new text end
new text begin
(1) the impact of inflation as measured by the implicit price deflator for state and
local government purchases;
new text end
new text begin
(2) population growth and decline;
new text end
new text begin
(3) state or federal government action; and
new text end
new text begin
(4) other financial factors that affect the level of property taxation and local services
that the governing body of the county, city, or school district may deem appropriate to
include.
new text end
new text begin
The information may be presented using tables, written narrative, and graphic
representations and may contain instruction toward further sources of information or
opportunity for comment.
new text end
new text begin
The supplemental information for each jurisdiction must not exceed one side of an
8.5 inch by 11 inch sheet of paper.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes payable in 2006 and
subsequent years.
new text end
Sec. 4.
Minnesota Statutes 2004, section 275.065, is amended by adding a subdivision
to read:
new text begin Subd. 3b. new text end
new text begin Taxpayer satisfaction survey. new text end
new text begin
(a) A taxpayer satisfaction survey form
must be attached to or enclosed with each proposed property tax notice under subdivision
3. The form must include a property description or a code number that allows the property
to be uniquely identified.
new text end
new text begin
(b) The taxpayer satisfaction survey form shall present the following question for
each jurisdiction subject to the taxpayer satisfaction survey: "Are you satisfied with the
proposed property tax levy for (name of jurisdiction)?" A space will be provided for the
respondent to answer "Yes" or "No" for each jurisdiction. The form must also inform the
taxpayer that if the number of responses marked "No" exceeds the criteria specified in
subdivision 3e, a referendum will be held on the question of the increase in the property
tax levy subject to approval unless a recertification is made under subdivision 9 reducing
the levy.
new text end
new text begin
(c) The mailing shall include a non-postage-paid envelope preaddressed to the
agency designated to process survey results. A taxpayer, including a tenant, renter, or
lessee who is entitled to receive a copy of the notice and survey form under subdivision 3,
paragraph (k), may respond to the survey by returning the completed survey form to the
designated agency by December 1. The responding taxpayer is responsible for the postage.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes payable in 2006 and
subsequent years, except that two provisions are first effective for taxes payable in 2007:
the requirement that the survey form include a property description or code number, and
the requirement that the form notify taxpayers that the results of the survey could cause a
referendum election to be held.
new text end
Sec. 5.
Minnesota Statutes 2004, section 275.065, is amended by adding a subdivision
to read:
new text begin Subd. 3c. new text end
new text begin Taxpayer satisfaction survey additional information. new text end
new text begin
The taxpayer
satisfaction survey form must include the following information for the current year and
for the proposed year, and show the percentage change between the years:
new text end
new text begin
(1) the county government's (i) budget and (ii) property tax levy subject to approval;
and
new text end
new text begin
(2) if the property is located in a city which is a jurisdiction subject to the taxpayer
satisfaction survey, the city government's (i) budget and (ii) property tax levy subject to
approval.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes payable in 2006 and
subsequent years.
new text end
Sec. 6.
Minnesota Statutes 2004, section 275.065, is amended by adding a subdivision
to read:
new text begin Subd. 3d. new text end
new text begin Format of taxpayer satisfaction survey. new text end
new text begin
The commissioner of revenue
shall prescribe the format of the survey form required under subdivisions 3b to 3f and
present the form to the chairs of the house and senate tax committees for review. The form
must be in the format prescribed by the commissioner.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes payable in 2006 and
subsequent years.
new text end
Sec. 7.
Minnesota Statutes 2004, section 275.065, is amended by adding a subdivision
to read:
new text begin Subd. 3e. new text end
new text begin Results of taxpayer satisfaction survey. new text end
new text begin
(a) Each agency designated to
receive taxpayer satisfaction surveys shall verify the authenticity of each form received, to
the extent possible, and tabulate the results of the survey for each taxing jurisdiction. If
the number of survey responses indicating dissatisfaction with the jurisdiction's proposed
levy exceeds 20 percent of the total number of proposed tax notices distributed in the
jurisdiction, and the proposed property tax levy subject to approval exceeds the property
tax levy subject to approval for taxes payable in the current year, a referendum must be
held on the last Tuesday in January. By December 8, the agency must announce the
results of the survey for each taxing jurisdiction, including both the number of responses
indicating that they are satisfied with the proposed levy and the number indicating that
they are not satisfied.
new text end
new text begin
(b) If the county auditor determines that a single person or entity owns more than
ten percent of the parcels of property within a jurisdiction subject to taxpayer satisfaction
survey, then the number of responses indicating dissatisfaction with the proposed levy
must exceed the percentage owed by the single person or entity plus 20 percent of the
total number of proposed tax notices distributed in the jurisdiction in order to initiate the
referendum process described in paragraph (a).
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes payable in 2006 and
subsequent years, except that the requirement of an automatic referendum election is
effective beginning with taxes payable in 2007 and subsequent years.
new text end
Sec. 8.
Minnesota Statutes 2004, section 275.065, is amended by adding a subdivision
to read:
new text begin Subd. 3f. new text end
new text begin Designated agency. new text end
new text begin
For taxpayer satisfaction surveys pertaining to taxes
payable in 2006, the designated agency is the county. For taxing jurisdictions located in
more than one county, each county shall tabulate the results of the survey for the portion
of the jurisdiction in the county, and forward the results to the jurisdiction's home county
by December 7. The home county shall make available the survey results for the total
jurisdiction.
new text end
new text begin
By January 1, 2006, and each year thereafter, the commissioner of revenue shall
designate the agency or agencies to receive and process taxpayer satisfaction surveys for
taxes payable in the following 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
subsequent years.
new text end
Sec. 9.
Minnesota Statutes 2004, section 275.065, subdivision 4, is amended to read:
Subd. 4.
Costs.
deleted text begin If the reasonable cost of deleted text end The county new text begin may apportion the cost of the
county new text end auditor's services and the cost of preparing and mailing the notice new text begin and survey
new text end required in this section deleted text begin exceed the amount distributed to the county by the commissioner of
revenue to administer this section, the taxing authority must reimburse the county for the
excess cost. The excess cost must be apportioned deleted text end between taxing jurisdictions as follows:
(1) one-third is allocated to the county;
(2) one-third is allocated to cities and towns within the county; and
(3) one-third is allocated to school districts within the county.
The amounts in clause (2) must be further apportioned among the cities and towns
in the proportion that the number of parcels in the city and town bears to the number of
parcels in all the cities and towns within the county. The amount in clause (3) must be
further apportioned among the school districts in the proportion that the number of parcels
in the school district bears to the number of parcels in all school districts within the county.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes payable in 2006 and
subsequent years.
new text end
Sec. 10.
Minnesota Statutes 2004, section 275.065, subdivision 7, is amended to read:
Subd. 7.
Certification of compliance.
At the time the taxing authority certifies
its tax levy under section 275.07, it shall certify to the commissioner of revenue its
compliance with this section. The certification must contain the information required
by the commissioner of revenue to determine compliance with this section. If the
commissioner determines that the taxing authority has failed to substantially comply with
the requirements of this section, the commissioner of revenue shall notify the county
auditor. The decision of the commissioner is final. When fixing rates under section 275.08
for a taxing authority that has not complied with this section, the county auditor must use
the taxing authority's previous year's levy, plus any additional amounts necessary to
deleted text begin pay principal and interest on general obligation bonds of the taxing authority for which its
taxing powers have been pledged if the bonds were issued before 1989 deleted text end new text begin fund an increase in
the authority's debt levy for taxes payable in the following yearnew text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes payable in 2006 and
subsequent years.
new text end
Sec. 11.
Minnesota Statutes 2004, section 275.065, is amended by adding a subdivision
to read:
new text begin Subd. 9. new text end
new text begin Recertification of proposed levy. new text end
new text begin
By December 15, a jurisdiction subject
to taxpayer satisfaction survey, that has been notified under subdivision 3e that the criteria
for a referendum have been met, may elect to recertify its proposed levy so that the
proposed property tax levy subject to approval is equal to the property tax levy subject to
approval for taxes payable in the current year. If the jurisdiction recertifies its proposed
levy to the county auditor according to the provisions of this subdivision, the auditor must
cancel the referendum for that jurisdiction.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes payable in 2007 and
subsequent years.
new text end
Sec. 12.
Minnesota Statutes 2004, section 275.065, is amended by adding a subdivision
to read:
new text begin Subd. 10. new text end
new text begin Levy approval; referendum. new text end
new text begin
(a) If the designated agency has determined
under subdivision 3e that a referendum is required, the increase in the property tax levy
subject to approval shall not be effective until it has been submitted to the voters at a
special election to be held on the last Tuesday in January, and a majority of votes cast on
the question of approving the levy increase are in the affirmative. The commissioner of
revenue shall prepare the form of the question to be presented at the referendum, which
must reference only the amount of increase in the property tax levy subject to approval.
new text end
new text begin
(b) If the majority of the votes cast on the question are in the affirmative, the proposed
levy shall be certified as the final levy. If the majority of the votes cast on the question are
in the negative, the levy shall be the property tax levy amount subject to approval for the
previous year, plus the portion of the proposed levy that was not subject to referendum.
new text end
new text begin
(c) A levy approved under this subdivision must be levied against the net tax
capacity of the jurisdiction.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes payable in 2007 and
subsequent years.
new text end
Sec. 13.
Minnesota Statutes 2004, section 275.07, subdivision 1, is amended to read:
Subdivision 1.
Certification of levy.
(a) Except as provided under paragraph (b), the
taxes voted by cities, counties, school districts, and special districts shall be certified by
the proper authorities to the county auditor on or before deleted text begin five working days after deleted text end December
deleted text begin 20 deleted text end new text begin 28 new text end in each year. new text begin A jurisdiction whose levy is subject to a referendum under section
275.065, subdivision 10, shall at that time certify two levy amounts, one if the referendum
is successful, and another if the referendum is not successful. A jurisdiction whose levy is
subject to a referendum must recertify its final levy the day immediately following the
election.new text end A town must certify the levy adopted by the town board to the county auditor by
September 15 each year. If the town board modifies the levy at a special town meeting
after September 15, the town board must recertify its levy to the county auditor on or
before deleted text begin five working days after deleted text end December deleted text begin 20 deleted text end new text begin 28new text end . The taxes certified shall be reduced by
the county auditor by the aid received under section 273.1398, subdivision 3. If a city,
town, county, school district, or special district fails to certify its levy by that date, its levy
shall be the amount levied by it for the preceding year.
(b)(i) The taxes voted by counties under sections 103B.241, 103B.245, and
103B.251 shall be separately certified by the county to the county auditor on or before
deleted text begin five working days after deleted text end December deleted text begin 20 deleted text end new text begin 28 new text end in each year. The taxes certified shall not be
reduced by the county auditor by the aid received under section 273.1398, subdivision
3. If a county fails to certify its levy by that date, its levy shall be the amount levied by
it for the preceding year.
(ii) For purposes of the proposed property tax notice under section 275.065 and
the property tax statement under section 276.04, for the first year in which the county
implements the provisions of this paragraph, the county auditor shall reduce the county's
levy for the preceding year to reflect any amount levied for water management purposes
under clause (i) included in the county's levy.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes payable in 2007 and
subsequent years.
new text end
Sec. 14. new text begin REPEALER.
new text end
new text begin
Minnesota Statutes 2004, section 275.065, subdivisions 5a, 6, 6b, and 8, are repealed.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes payable in 2006 and
subsequent years.
new text end
ARTICLE 2
PROPERTY TAXES
Section 1.
Minnesota Statutes 2004, section 272.02, subdivision 47, is amended to read:
Subd. 47.
Poultry litter biomass generation facility; personal property.
Notwithstanding subdivision 9, clause (a), attached machinery and other personal property
which is part of an electrical generating facility that meets the requirements of this
subdivision is exempt. At the time of construction, the facility must:
(1) be designed to utilize poultry litter as a primary fuel source; and
(2) be constructed for the purpose of generating power at the facility that will be sold
pursuant to a contract approved by the Public Utilities Commission in accordance with
the biomass mandate imposed under section 216B.2424.
Construction of the facility must be commenced after January 1, 2003, and before
December 31, deleted text begin 2003 deleted text end new text begin 2005new text end . Property eligible for this exemption does not include electric
transmission lines and interconnections or gas pipelines and interconnections appurtenant
to the property or the facility.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes levied in 2005, payable
in 2006, and thereafter.
new text end
Sec. 2.
Minnesota Statutes 2004, section 272.02, subdivision 53, is amended to read:
Subd. 53.
Electric generation facility; personal property.
Notwithstanding
subdivision 9, clause (a), attached machinery and other personal property which is part
of a 3.2 megawatt run-of-the-river hydroelectric generation facility and that meets the
requirements of this subdivision is exempt. At the time of construction, the facility must:
(1) utilize two turbine generators at a dam site existing on March 31, 1994;
(2) be located on deleted text begin publicly owned deleted text end land deleted text begin and deleted text end within 1,500 feet of a 13.8 kilovolt
distribution substation; and
(3) be eligible to receive a renewable energy production incentive payment under
section 216C.41.
Construction of the facility must be commenced afterdeleted text begin January 1, 2002 deleted text end new text begin December
31, 2004new text end , and before January 1, deleted text begin 2005 deleted text end new text begin 2007new text end . Property eligible for this exemption
does not include electric transmission lines and interconnections or gas pipelines and
interconnections appurtenant to the property or the facility.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes levied in 2005, payable in
2006 and thereafter.
new text end
Sec. 3.
Minnesota Statutes 2004, section 272.02, is amended by adding a subdivision
to read:
new text begin Subd. 68. new text end
new text begin Electric generation facility personal property. new text end
new text begin
(a) Notwithstanding
subdivision 9, clause (a), and section 453.54, subdivision 20, attached machinery and
other personal property which is part of an electric generation facility that exceeds 150
megawatts of installed capacity and meets the requirements of this subdivision is exempt.
At the time of construction, the facility must:
new text end
new text begin
(1) be designed to utilize natural gas as a primary fuel;
new text end
new text begin
(2) be owned and operated by a municipal power agency as defined in section
453.52, subdivision 8;
new text end
new text begin
(3) have received the certificate of need under section 216B.243;
new text end
new text begin
(4) be located outside the metropolitan area as defined under section 473.121,
subdivision 2; and
new text end
new text begin
(5) be designed to be a combined-cycle facility, although initially the facility will be
operated as a simple-cycle combustion turbine.
new text end
new text begin
(b) To qualify under this subdivision, an agreement must be negotiated between the
municipal power agency and the host city, for a payment in lieu of property taxes to the
host city.
new text end
new text begin
(c) Construction of the facility must be commenced after January 1, 2004, and
before January 1, 2006. Property eligible for this exemption does not include electric
transmission lines and interconnections or gas pipelines and interconnections appurtenant
to the property or the facility.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for assessment year 2005, taxes
payable in 2006, and thereafter.
new text end
Sec. 4.
Minnesota Statutes 2004, section 272.02, is amended by adding a subdivision
to read:
new text begin Subd. 69. new text end
new text begin Electric generation facility; personal property. new text end
new text begin
(a) Notwithstanding
subdivision 9, clause (a), attached machinery and other personal property which is part of
a simple-cycle combustion-turbine electric generation facility that exceeds 290 megawatts
of installed capacity and that meets the requirements of this subdivision is exempt. At
the time of construction, the facility must:
new text end
new text begin
(1) be designed to utilize natural gas as a primary fuel;
new text end
new text begin
(2) not be owned by a public utility as defined in section 216B.02, subdivision 4;
new text end
new text begin
(3) be located within 15 miles of the mainline existing interstate natural gas pipeline
and within five miles of an existing electrical transmission substation;
new text end
new text begin
(4) be located outside the metropolitan area as defined under section 473.121,
subdivision 2; and
new text end
new text begin
(5) be designed to provide peaking capacity energy and ancillary services and have
satisfied all of the requirements under section 216B.243.
new text end
new text begin
(b) Construction of the facility must be commenced after January 1, 2005, and
before January 1, 2009. Property eligible for this exemption does not include electric
transmission lines and interconnections or gas pipelines and interconnections appurtenant
to the property or the facility.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for assessment year 2006, taxes
payable in 2007, and thereafter.
new text end
Sec. 5.
Minnesota Statutes 2004, section 272.02, is amended by adding a subdivision
to read:
new text begin Subd. 70. new text end
new text begin Electric generation facility; personal property. new text end
new text begin
Notwithstanding
subdivision 9, clause (a), attached machinery and other personal property which is part
of an existing simple-cycle, combustion-turbine electric generation facility that exceeds
300 megawatts of installed capacity and that meets the requirements of this subdivision is
exempt. At the time of the construction, the facility must:
new text end
new text begin
(1) be designed to utilize natural gas as a primary fuel;
new text end
new text begin
(2) be owned by a public utility as defined in section 216B.02, subdivision 4, and be
located at or interconnected with an existing generating plant of the utility;
new text end
new text begin
(3) be designed to provide peaking, emergency backup, or contingency services;
new text end
new text begin
(4) satisfy a resource need identified in an approved integrated resource plan filed
under section 216B.2422; and
new text end
new text begin
(5) have received, by resolution, the approval from the governing body of the county
and the city for the exemption of personal property under this subdivision.
new text end
new text begin
Construction of the facility expansion must be commenced after January 1, 2004,
and before January 1, 2005. Property eligible for this exemption does not include electric
transmission lines and interconnections or gas pipelines and interconnections appurtenant
to the property or the facility.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective beginning with assessment year
2005, for taxes payable in 2006 and thereafter.
new text end
Sec. 6.
Minnesota Statutes 2004, section 272.02, is amended by adding a subdivision
to read:
new text begin Subd. 71. new text end
new text begin Electric generation facility; personal property. new text end
new text begin
(a) Notwithstanding
subdivision 9, clause (a), attached machinery and other personal property which is part of
a simple-cycle combustion-turbine electric generation facility that exceeds 150 megawatts
of installed capacity and that meets the requirements of this subdivision is exempt. At
the time of construction, the facility must:
new text end
new text begin
(1) utilize natural gas as a primary fuel;
new text end
new text begin
(2) be owned by an electric generation and transmission cooperative;
new text end
new text begin
(3) be located within five miles of parallel existing 12-inch and 16-inch natural gas
pipelines and a 69-kilovolt high-voltage electric transmission line;
new text end
new text begin
(4) be designed to provide peaking, emergency backup, or contingency services;
new text end
new text begin
(5) have received a certificate of need under section 216B.243 demonstrating
demand for its capacity; and
new text end
new text begin
(6) have received by resolution the approval from the governing body of the county
and township in which the proposed facility is to be located for the exemption of personal
property under this subdivision.
new text end
new text begin
(b) Construction of the facility must be commenced after July 1, 2005, and
before January 1, 2009. Property eligible for this exemption does not include electric
transmission lines and interconnections or gas pipelines and interconnections appurtenant
to the property or the facility.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for assessment year 2006 and
thereafter, for taxes payable in 2007 and thereafter.
new text end
Sec. 7.
Minnesota Statutes 2004, section 272.02, is amended by adding a subdivision
to read:
new text begin Subd. 72. new text end
new text begin Electric generation facility personal property. new text end
new text begin
(a) Notwithstanding
subdivision 9, clause (a), attached machinery and other personal property which is part of
either a simple-cycle, combustion-turbine electric generation facility, or a combined-cycle,
combustion-turbine electric generation facility that does not exceed 325 megawatts of
installed capacity and that meets the requirements of this subdivision is exempt. At the
time of construction, the facility must:
new text end
new text begin
(1) utilize either a simple-cycle or a combined-cycle combustion-turbine generator
fueled by natural gas;
new text end
new text begin
(2) be connected to an existing 115-kilovolt high-voltage electric transmission line
that is within two miles of the facility;
new text end
new text begin
(3) be located on an underground natural gas storage aquifer;
new text end
new text begin
(4) be designed as either a peaking or intermediate load facility; and
new text end
new text begin
(5) have received, by resolution, the approval from the governing body of the county
for the exemption of personal property under this subdivision.
new text end
new text begin
(b) Construction of the facility must be commenced after January 1, 2006, and
before January 1, 2008. Property eligible for this exemption does not include electric
transmission lines and interconnections or gas pipelines and interconnections appurtenant
to the property or the facility.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for assessment year 2005, taxes
payable in 2006, and thereafter.
new text end
Sec. 8.
Minnesota Statutes 2004, section 272.0211, subdivision 1, is amended to read:
Subdivision 1.
Efficiency determination and certification.
An owner or operator
of a new or existing electric power generation facility, excluding wind energy conversion
systems, may apply to the commissioner of revenue for a market value exclusion on the
property as provided for in this section. This exclusion shall apply only to the market
value of the equipment of the facility, and shall not apply to the structures and the land
upon which the facility is located. The commissioner of revenue shall prescribe the forms
and procedures for this application. Upon receiving the application, the commissioner
of revenue shall request the commissioner of commerce to make a determination of the
efficiency of the applicant's electric power generation facility. deleted text begin In calculating the efficiency
of a facility,deleted text end The commissioner of commerce shalldeleted text begin use a definition of deleted text end new text begin calculate new text end efficiency
deleted text begin which calculates efficiency as the sum of:
deleted text end
deleted text begin
(1) the useful electrical power output; plus
deleted text end
deleted text begin
(2) the useful thermal energy output; plus
deleted text end
deleted text begin
(3) the fuel energy of the useful chemical products,
deleted text end
deleted text begin all divided by the total energy input to the facility, expressed as a percentage deleted text end new text begin as the
ratio of useful energy outputs to energy inputs, expressed as a percentage, based on
the performance of the facility's equipment during normal full load operationnew text end . The
commissioner must include in this formula the energy used in any on-site preparation of
materials necessary to convert the materials into the fuel used to generate electricity,
such as a process to gasify petroleum coke. The commissioner shall use the deleted text begin high deleted text end new text begin Higher
new text end Heating Value new text begin (HHV) new text end for all substances in the commissioner's efficiency calculations,
except for wood for fuel in a biomass-eligible project under section 216B.2424; for
these instances, the commissioner shall adjust the heating value to allow for energy
consumed for evaporation of the moisture in the wood. The applicant shall provide
the commissioner of commerce with whatever information the commissioner deems
necessary to make the determination. Within 30 days of the receipt of the necessary
information, the commissioner of commerce shall certify the findings of the efficiency
determination to the commissioner of revenue and to the applicant. The commissioner
of commerce shall determine the efficiency of the facility and certify the findings of
that determination to the commissioner of revenue every two years thereafter from the
date of the original certification.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for assessment year 2005 and
thereafter, for taxes payable in 2006 and thereafter.
new text end
Sec. 9.
Minnesota Statutes 2004, section 272.0211, subdivision 2, is amended to read:
Subd. 2.
Sliding scale exclusion.
Based upon the efficiency determination provided
by the commissioner of commerce as described in subdivision 1, the commissioner of
revenue shall subtract deleted text begin five deleted text end new text begin eight new text end percent of the taxable market value of the qualifying
property for each percentage point that the efficiency of the specific facility, as determined
by the commissioner of commerce, is above deleted text begin 35 deleted text end new text begin 40 new text end percent. The reduction in taxable
market value shall be reflected in the taxable market value of the facility beginning
with the assessment year immediately following the determination. For a facility that is
assessed by the county in which the facility is located, the commissioner of revenue
shall certify to the assessor of that county the percentage of the taxable market value of
the facility to be excluded.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for assessment year 2005 and
thereafter, for taxes payable in 2006 and thereafter.
new text end
Sec. 10.
new text begin
[272.0275] PERSONAL PROPERTY USED TO GENERATE
ELECTRICITY; EXEMPTION.
new text end
new text begin Subdivision 1. new text end
new text begin New plant construction after january 1, 2005. new text end
new text begin
For a new generating
plant built and placed in service after January 1, 2005, its personal property used to
generate electric power is exempt from property taxation, including under section 453.54,
subdivision 20, if an exemption of generation personal property form, with an attached
siting agreement, is filed with the Department of Revenue. The form must be signed by
the utility, and the county and city or town where the facility is proposed to be located.
new text end
new text begin Subd. 2. new text end
new text begin Existing plant; increase in nameplate capacity. new text end
new text begin
For a plant existing or
under construction on the day of final enactment of this act, a partial exemption applies
if the nameplate capacity of the plant is increased from that existing on the day of final
enactment of this act, and if an exemption of generation personal property form, with an
attached siting agreement is filed with the Department of Revenue. The form must be
signed by the utility, and the county and city or town where the facility expansion is
located. This partial exemption must be computed by taking the increase in megawatts
over the total megawatt nameplate capacity after construction is complete, multiplied by
the market value of all taxable tools, implements, and machinery of the generating plant
as determined by the commissioner of revenue. The resulting exemption is effective
beginning in the next assessment year.
new text end
new text begin Subd. 3. new text end
new text begin In-lieu payment; limitation. new text end
new text begin
If an in-lieu payment or service fee is
negotiated between a facility exempted under this section and the county, city, or town
where the facility is located, the payment or fee in any year may not exceed the property
tax revenue that the jurisdiction would receive from the facility if it were not exempt.
new text end
new text begin Subd. 4. new text end
new text begin Definition; applicability. new text end
new text begin
For purposes of this section, "personal property"
means tools, implements, and machinery of the generating plant. The exemption under this
section does not apply to transformers, transmission lines, distribution lines, or any other
tools, implements, and machinery that are part of an electric substation, wherever located.
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. 11.
Minnesota Statutes 2004, section 273.055, is amended to read:
273.055 RESOLUTION TO APPOINT ASSESSOR; TERMINATION OF
LOCAL ASSESSOR'S OFFICE.
The election to provide for the assessment of property by the county assessor as
provided in section 273.052 shall be made by the board of county commissioners by
resolution new text begin with at least a two-thirds majority votenew text end . Such resolution shall be effective at the
second assessment date following the adoption of the resolution. Notwithstanding any
other provisions contained in any other section of law or charter, the office of all township
and city assessors in such county shall be terminated 90 days before the assessment date at
which the election becomes effective, except that if part of such taxing district is located
in a county not electing to have the county assessor assess all property as provided
in section 273.052, the office will continue but shall apply only to such property in a
nonelecting county.
No township or city assessor in another county shall assess any property in an
electing county, but shall turn over all tax records relating to property to the county assessor
90 days before the assessment date at which the county's election becomes effective.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 12.
Minnesota Statutes 2004, section 273.0755, is amended to read:
273.0755 TRAINING AND EDUCATION OF PROPERTY TAX PERSONNEL.
(a) Beginning with the four-year period starting on July 1, 2000, every person
licensed by the state Board of Assessors at the Accredited Minnesota Assessor level or
higher, shall successfully complete a week-long Minnesota laws course sponsored by the
Department of Revenue at least once in every four-year period. An assessor need not
attend the course if they successfully pass the test for the course.
(b) The commissioner of revenue may require that each county, and each city
for which the city assessor performs the duties of county assessor, have (i) a person
on the assessor's staff who is certified by the Department of Revenue in sales ratio
calculations, (ii) an officer or employee who is certified by the Department of Revenue
in tax calculations, and (iii) an officer or employee who is certified by the Department
of Revenue in the proper preparation of abstracts of assessment. The commissioner of
revenue may require that each county have an officer or employee who is certified by the
Department of Revenue in the proper preparation of abstracts of tax lists.
new text begin
(c) Beginning with the four-year educational licensing period starting on July 1,
2004, every Minnesota assessor licensed by the State Board of Assessors must attend
and participate in a seminar that focuses on ethics, professional conduct and the need
for standardized assessment practices developed and presented by the commissioner of
revenue. This requirement must be met at least once in every subsequent four-year period.
This requirement applies to all assessors licensed for one year or more in the four-year
period.
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. 13.
Minnesota Statutes 2004, section 273.11, subdivision 1a, is amended to read:
Subd. 1a.
Limited market value.
In the case of all new text begin real new text end property deleted text begin classified as
agricultural homestead or nonhomestead, residential homestead or nonhomestead, timber,
or noncommercial seasonal residential recreationaldeleted text end , the assessor shall compare the value
with the taxable portion of the value determined in the preceding assessmentnew text begin , except
that for class 1c resort property for assessment year 2005, the assessor shall determine
the limited market value as provided in subdivision 1bnew text end .
deleted text begin
For assessment year 2002, the amount of the increase shall not exceed the greater of
(1) ten percent of the value in the preceding assessment, or (2) 15 percent of the difference
between the current assessment and the preceding assessment.
deleted text end
deleted text begin
For assessment year 2003, the amount of the increase shall not exceed the greater of
(1) 12 percent of the value in the preceding assessment, or (2) 20 percent of the difference
between the current assessment and the preceding assessment.
deleted text end
For assessment deleted text begin year deleted text end new text begin years new text end 2004new text begin , 2005, and 2006new text end , the amount of the increase shall
not exceed the greater of (1) 15 percent of the value in the preceding assessment, or (2) 25
percent of the difference between the current assessment and the preceding assessment.
For assessment year deleted text begin 2005 deleted text end new text begin 2007new text end , the amount of the increase shall not exceed the
greater of (1) 15 percent of the value in the preceding assessment, or (2) 33 percent of the
difference between the current assessment and the preceding assessment.
For assessment year deleted text begin 2006 deleted text end new text begin 2008new text end , the amount of the increase shall not exceed the
greater of (1) 15 percent of the value in the preceding assessment, or (2) 50 percent of the
difference between the current assessment and the preceding assessment.
This limitation shall not apply to increases in value due to improvements. For
purposes of this subdivision, the term "assessment" means the value prior to any exclusion
under subdivision 16.
The provisions of this subdivision shall be in effect through assessment year deleted text begin 2006
deleted text end new text begin 2008 new text end as provided in this subdivision.
For purposes of the assessment/sales ratio study conducted under section 127A.48,
and the computation of state aids paid under chapters 122A, 123A, 123B, 124D, 125A,
126C, 127A, and 477A, market values and net tax capacities determined under this
subdivision and subdivision 16, shall be used.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for assessment years 2005 through
2008, for taxes payable in 2006 through 2009.
new text end
Sec. 14.
Minnesota Statutes 2004, section 273.11, is amended by adding a subdivision
to read:
new text begin Subd. 1b. new text end
new text begin Class 1c resorts; 2005 assessment only. new text end
new text begin
For assessment year 2005, the
valuation on class 1c resort property shall not exceed the greater of (1) 130 percent of the
value of its 2003 assessment, or (2) its value for the 2003 assessment year plus 40 percent
of the difference in value between its 2005 assessment and its 2003 assessment. The
valuation increase on class 1c resort property for assessment years 2006 and thereafter
shall be determined as provided under subdivision 1a.
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. 15.
Minnesota Statutes 2004, section 273.11, is amended by adding a subdivision
to read:
new text begin Subd. 21. new text end
new text begin Valuation exclusion for lead hazard reduction. new text end
new text begin
Owners of property
classified as class 1a, 1b, 1c, 2a, 4b, or 4bb under section 273.13 may apply for a valuation
exclusion for lead hazard reduction, provided that the property is located in a city which
has authorized valuation exclusions under this subdivision. A city may by resolution
authorize valuation exclusions under this subdivision and must establish guidelines for
qualifying lead hazard reduction projects and must designate an agency within the city to
issue certificates of completion of qualifying projects. For purposes of this subdivision,
"lead hazard reduction" has the same meaning as in section 144.9501, subdivision 17.
new text end
new text begin
The property owner must obtain a certificate from the city stating that the project
has been completed and stating the cost incurred by the owner in completing the project.
Only projects originating after April 1, 2004, may qualify for exclusion under this
subdivision. The property owner shall apply for a valuation exclusion to the assessor on a
form prescribed by the assessor.
new text end
new text begin
A qualifying property is eligible for a valuation exclusion equal to 50 percent of
the actual costs incurred, to a maximum exclusion of $15,000, for a period of five years.
The valuation exclusion shall terminate upon the sale of the property. If a property owner
applies for exclusion under this subdivision between January 1 and June 30 of any year,
the exclusion shall first apply for taxes payable in the following year. If a property owner
applies for exclusion under this subdivision between July 1 and December 31 of any year,
the exclusion shall first apply for taxes payable in the second following 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
subsequent years.
new text end
Sec. 16.
Minnesota Statutes 2004, section 273.111, is amended by adding a subdivision
to read:
new text begin Subd. 86. new text end
new text begin Applications; denied by county. new text end
new text begin
Beginning with applications filed for
the 2005 assessment year, all applications for deferment of taxes and assessment under
this section that have been denied by the county shall be forwarded to the commissioner of
revenue by the county assessor within 30 days of denial. For the purpose of monitoring
compliance with this section, the commissioner of revenue shall compile a report
identifying all denied applications, the reason for the denial and any commissioner action
or recommendation. This report will be annually submitted to the chairs of the house and
senate tax committees on or before February 1.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for applications filed after the day
following final enactment.
new text end
Sec. 17.
Minnesota Statutes 2004, section 273.123, subdivision 7, is amended to read:
Subd. 7.
Local option; other property.
The owner of homestead property
not qualifying for an adjustment in valuation pursuant to subdivisions 1 to 5 or of
nonhomestead property may receive a reduction in the amount of taxes payable on the
property for the year in which the destruction occurs and in the following year if:
(a) 50 percent or more of the homestead dwelling or other structure, as established
by the county assessor, is unintentionally or accidentally destroyed new text begin or contaminated by
mold new text end and the homestead is uninhabitable or the other structure is not usable;
(b) the owner of the property makes written application to the county assessor as
soon as practical after the damage has occurred; and
(c) the owner of the property makes written application to the county board.
The county board may grant a reduction in the amount of property tax which the
owner must pay on the qualifying property in the year of destruction and in the following
year. Any reduction in the amount of tax payable which is authorized by county board
action shall be calculated based upon the number of months that the home is uninhabitable
or the other structure is unusable. The amount of net tax due from the taxpayer shall be
multiplied by a fraction, the numerator of which is the number of months the dwelling
was occupied by that taxpayer, or the number of months the other structure was used by
the taxpayer, and the denominator of which is 12. For purposes of this subdivision, if a
structure is occupied or used for a fraction of a month, it is considered a month. "Net tax"
is defined as the amount of tax after the subtraction of all of the state paid property tax
credits. If application is made following payment of all property taxes due for the year of
destruction, the amount of the reduction granted by the county board shall be refunded to
the taxpayer by the county treasurer as soon as practical.
Any reductions or refunds approved by the county board shall not be subject to
approval by the commissioner of revenue.
The county board may levy in the following year the amount of tax dollars lost to the
county government as a result of the reductions granted pursuant to this subdivision.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for property taxes payable in 2005
and thereafter.
new text end
Sec. 18.
Minnesota Statutes 2004, section 273.124, subdivision 14, is amended to read:
Subd. 14.
Agricultural homesteads; special provisions.
(a) Real estate of less than
ten acres that is the homestead of its owner must be classified as class 2a under section
273.13, subdivision 23, paragraph (a), if:
(1) the parcel on which the house is located is contiguous on at least two sides to (i)
agricultural land, (ii) land owned or administered by the United States Fish and Wildlife
Service, or (iii) land administered by the Department of Natural Resources on which in
lieu taxes are paid under sections 477A.11 to 477A.14;
(2) its owner also owns a noncontiguous parcel of agricultural land that is at least
20 acres;
(3) the noncontiguous land is located not farther than four townships or cities, or a
combination of townships or cities from the homestead; and
(4) the agricultural use value of the noncontiguous land and farm buildings is equal
to at least 50 percent of the market value of the house, garage, and one acre of land.
Homesteads initially classified as class 2a under the provisions of this paragraph shall
remain classified as class 2a, irrespective of subsequent changes in the use of adjoining
properties, as long as the homestead remains under the same ownership, the owner owns a
noncontiguous parcel of agricultural land that is at least 20 acres, and the agricultural use
value qualifies under clause (4). Homestead classification under this paragraph is limited
to property that qualified under this paragraph for the 1998 assessment.
(b)(i) Agricultural property consisting of at least 40 acres shall be classified as the
owner's homestead, to the same extent as other agricultural homestead property, if all
of the following criteria are met:
(1) the owner, the owner's spouse, deleted text begin or deleted text end the son or daughter of the owner or owner's
spouse, new text begin or the grandson or granddaughter of the owner or the owner's spouse,new text end is actively
farming the agricultural property, either on the person's own behalf as an individual or
on behalf of a partnership operating a family farm, family farm corporation, joint family
farm venture, or limited liability company of which the person is a partner, shareholder, or
member;
(2) both the owner of the agricultural property and the person who is actively
farming the agricultural property under clause (1), are Minnesota residents;
(3) neither the owner nor the spouse of the owner claims another agricultural
homestead in Minnesota; and
(4) neither the owner nor the person actively farming the property lives farther
than four townships or cities, or a combination of four townships or cities, from the
agricultural property, except that if the owner or the owner's spouse is required to live in
employer-provided housing, the owner or owner's spouse, whichever is actively farming
the agricultural property, may live more than four townships or cities, or combination of
four townships or cities from the agricultural property.
The relationship under this paragraph may be either by blood or marriage.
(ii) Real property held by a trustee under a trust is eligible for agricultural homestead
classification under this paragraph if the qualifications in clause (i) are met, except that
"owner" means the grantor of the trust.
(iii) Property containing the residence of an owner who owns qualified property
under clause (i) shall be classified as part of the owner's agricultural homestead, if that
property is also used for noncommercial storage or drying of agricultural crops.
(c) Noncontiguous land shall be included as part of a homestead under section
273.13, subdivision 23, paragraph (a), only if the homestead is classified as class 2a
and the detached land is located in the same township or city, or not farther than four
townships or cities or combination thereof from the homestead. Any taxpayer of these
noncontiguous lands must notify the county assessor that the noncontiguous land is part of
the taxpayer's homestead, and, if the homestead is located in another county, the taxpayer
must also notify the assessor of the other county.
(d) Agricultural land used for purposes of a homestead and actively farmed by a
person holding a vested remainder interest in it must be classified as a homestead under
section 273.13, subdivision 23, paragraph (a). If agricultural land is classified class 2a,
any other dwellings on the land used for purposes of a homestead by persons holding
vested remainder interests who are actively engaged in farming the property, and up to
one acre of the land surrounding each homestead and reasonably necessary for the use of
the dwelling as a home, must also be assessed class 2a.
(e) Agricultural land and buildings that were class 2a homestead property under
section 273.13, subdivision 23, paragraph (a), for the 1997 assessment shall remain
classified as agricultural homesteads for subsequent assessments if:
(1) the property owner abandoned the homestead dwelling located on the agricultural
homestead as a result of the April 1997 floods;
(2) the property is located in the county of Polk, Clay, Kittson, Marshall, Norman,
or Wilkin;
(3) the agricultural land and buildings remain under the same ownership for the
current assessment year as existed for the 1997 assessment year and continue to be used
for agricultural purposes;
(4) the dwelling occupied by the owner is located in Minnesota and is within 30
miles of one of the parcels of agricultural land that is owned by the taxpayer; and
(5) the owner notifies the county assessor that the relocation was due to the 1997
floods, and the owner furnishes the assessor any information deemed necessary by the
assessor in verifying the change in dwelling. Further notifications to the assessor are not
required if the property continues to meet all the requirements in this paragraph and any
dwellings on the agricultural land remain uninhabited.
(f) Agricultural land and buildings that were class 2a homestead property under
section 273.13, subdivision 23, paragraph (a), for the 1998 assessment shall remain
classified agricultural homesteads for subsequent assessments if:
(1) the property owner abandoned the homestead dwelling located on the agricultural
homestead as a result of damage caused by a March 29, 1998, tornado;
(2) the property is located in the county of Blue Earth, Brown, Cottonwood,
LeSueur, Nicollet, Nobles, or Rice;
(3) the agricultural land and buildings remain under the same ownership for the
current assessment year as existed for the 1998 assessment year;
(4) the dwelling occupied by the owner is located in this state and is within 50 miles
of one of the parcels of agricultural land that is owned by the taxpayer; and
(5) the owner notifies the county assessor that the relocation was due to a March 29,
1998, tornado, and the owner furnishes the assessor any information deemed necessary by
the assessor in verifying the change in homestead dwelling. For taxes payable in 1999, the
owner must notify the assessor by December 1, 1998. Further notifications to the assessor
are not required if the property continues to meet all the requirements in this paragraph
and any dwellings on the agricultural land remain uninhabited.
(g) Agricultural property consisting of at least 40 acres of a family farm corporation,
joint family farm venture, family farm limited liability company, or partnership operating
a family farm as described under subdivision 8 shall be classified homestead, to the same
extent as other agricultural homestead property, if all of the following criteria are met:
(1) a shareholder, member, or partner of that entity is actively farming the
agricultural property;
(2) that shareholder, member, or partner who is actively farming the agricultural
property is a Minnesota resident;
(3) neither that shareholder, member, or partner, nor the spouse of that shareholder,
member, or partner claims another agricultural homestead in Minnesota; and
(4) that shareholder, member, or partner does not live farther than four townships or
cities, or a combination of four townships or cities, from the agricultural property.
Homestead treatment applies under this paragraph for property leased to a family
farm corporation, joint farm venture, limited liability company, or partnership operating a
family farm if legal title to the property is in the name of an individual who is a member,
shareholder, or partner in the entity.
(h) To be eligible for the special agricultural homestead under this subdivision, an
initial full application must be submitted to the county assessor where the property is
located. Owners and the persons who are actively farming the property shall be required
to complete only a one-page abbreviated version of the application in each subsequent
year provided that none of the following items have changed since the initial application:
(1) the day-to-day operation, administration, and financial risks remain the same;
(2) the owners and the persons actively farming the property continue to live within
the four townships or city criteria and are Minnesota residents;
(3) the same operator of the agricultural property is listed with the Farm Service
Agency;
(4) a Schedule F or equivalent income tax form was filed for the most recent year;
(5) the property's acreage is unchanged; and
(6) none of the property's acres have been enrolled in a federal or state farm program
since the initial application.
The owners and any persons who are actively farming the property must include
the appropriate Social Security numbers, and sign and date the application. If any of the
specified information has changed since the full application was filed, the owner must
notify the assessor, and must complete a new application to determine if the property
continues to qualify for the special agricultural homestead. The commissioner of revenue
shall prepare a standard reapplication form for use by the assessors.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for assessment year 2005 and
thereafter, for taxes payable in 2006 and thereafter.
new text end
Sec. 19.
Minnesota Statutes 2004, section 273.125, subdivision 8, is amended to read:
Subd. 8.
Manufactured homes; sectional structures.
(a) In this section,
"manufactured home" means a structure transportable in one or more sections, which is
built on a permanent chassis, and designed to be used as a dwelling with or without a
permanent foundation when connected to the required utilities, and contains the plumbing,
heating, air conditioning, and electrical systems in it. Manufactured home includes any
accessory structure that is an addition or supplement to the manufactured home and, when
installed, becomes a part of the manufactured home.
(b) new text begin Except as provided in paragraph (c),new text end a manufactured home that meets each of the
following criteria must be valued and assessed as an improvement to real property, the
appropriate real property classification applies, and the valuation is subject to review and
the taxes payable in the manner provided for real property:
(1) the owner of the unit holds title to the land on which it is situated;
(2) the unit is affixed to the land by a permanent foundation or is installed at its
location in accordance with the Manufactured Home Building Code in sections 327.31
to 327.34, and rules adopted under those sections, or is affixed to the land like other real
property in the taxing district; and
(3) the unit is connected to public utilities, has a well and septic tank system, or is
serviced by water and sewer facilities comparable to other real property in the taxing
district.
(c) A manufactured home that meets each of the following criteria must be assessed
at the rate provided by the appropriate real property classification but must be treated as
personal property, and the valuation is subject to review and the taxes payable in the
manner provided in this section:
(1) the owner of the unit is a lessee of the land under the terms of a leasenew text begin , or the unit
is located in a manufactured home park, campground, or resortnew text end ;
(2) the unit is affixed to the land by a permanent foundation or is installed at its
location in accordance with the Manufactured Home Building Code contained in sections
327.31 to 327.34, and the rules adopted under those sections, or is affixed to the land like
other real property in the taxing district; and
(3) the unit is connected to public utilities, has a well and septic tank system, or is
serviced by water and sewer facilities comparable to other real property in the taxing
district.
(d) Sectional structures must be valued and assessed as an improvement to real
property if the owner of the structure holds title to the land on which it is located or is a
qualifying lessee of the land under section 273.19. In this paragraph "sectional structure"
means a building or structural unit that has been in whole or substantial part manufactured
or constructed at an off-site location to be wholly or partially assembled on-site alone or
with other units and attached to a permanent foundation.
(e) The commissioner of revenue may adopt rules under the Administrative
Procedure Act to establish additional criteria for the classification of manufactured homes
and sectional structures under this subdivision.
(f) A storage shed, deck, or similar improvement constructed on property that is
leased or rented as a site for a manufactured home, sectional structure, park trailer, or
travel trailer is taxable as provided in this section. In the case of property that is leased or
rented as a site for a travel trailer, a storage shed, deck, or similar improvement on the
site that is considered personal property under this paragraph is taxable only if its total
estimated market value is over $500. The property is taxable as personal property to the
lessee of the site if it is not owned by the owner of the site. The property is taxable as
real estate if it is owned by the owner of the site. As a condition of permitting the owner
of the manufactured home, sectional structure, park trailer, or travel trailer to construct
improvements on the leased or rented site, the owner of the site must obtain the permanent
home address of the lessee or user of the site. The site owner must provide the name
and address to the assessor upon request.
new text begin EFFECTIVE DATE. new text end
new text begin
For purposes of Minnesota Statutes, sections 272.12 and
272.121, this section is effective the day following final enactment. For all other purposes,
this section is effective beginning with taxes payable in 2006, except that for any property
treated as real property under this section for the 2005 assessment that will be treated as
personal property under this section for the 2006 assessment, an adjustment must be made
to the 2005 assessment roll on or before July 1, 2005, to reflect those changes.
new text end
Sec. 20.
new text begin
[273.126] CERTIFICATION OF LOW-INCOME RENTAL PROPERTY.
new text end
new text begin Subdivision 1. new text end
new text begin Requirement. new text end
new text begin
Low-income rental property is entitled to
classification as class 4d under section 273.13, subdivision 25, paragraph (e), for a
maximum period of five years if at least 75 percent of the units in the rental housing
property meet any of the following qualifications:
new text end
new text begin
(1) the units are subject to a housing assistance payments contract under Section 8
of the United States Housing Act of 1937, as amended;
new text end
new text begin
(2) the units are rent-restricted and income-restricted units of a qualified low-income
housing project receiving tax credits under section 42(g) of the Internal Revenue Code
of 1986, as amended; or
new text end
new text begin
(3) the units are financed by the Rural Housing Service of the United States
Department of Agriculture and receive payments under the rental assistance program
pursuant to Section 521(a) of the Housing Act of 1949, as amended.
new text end
new text begin Subd. 2. new text end
new text begin Application. new text end
new text begin
(a) Application for certification under this section must
be filed by March 31 of the levy year, or at a later date if the Housing Finance Agency
deems practicable. The application must be filed with the Housing Finance Agency,
on a form prescribed by the agency, and must contain the information required by the
Housing Finance Agency.
new text end
new text begin
(b) Each application must include:
new text end
new text begin
(1) the property tax identification number;
new text end
new text begin
(2) evidence that the property meets the requirements of subdivision 1; and
new text end
new text begin
(3) a true and correct copy of the financial statement related to the property.
new text end
new text begin
(c) The Housing Finance Agency may charge an application fee approximately equal
to the costs of processing and reviewing the applications but not to exceed $10 per unit. If
imposed, the applicant must pay the application fee to the Housing Finance Agency. The
fee must be deposited in the housing development fund.
new text end
new text begin
(d) An owner of low-income rental property certified under this section must reapply
under this subdivision for certification every five years.
new text end
new text begin Subd. 3. new text end
new text begin Certification. new text end
new text begin
By June 1 of each levy year, the Housing Finance Agency
must certify to local assessors the properties that are qualified under this section and the
number of units in the building that qualify. In making the certification, the Housing
Finance Agency may rely on the application and any other supporting information that the
agency deems necessary from the property owner.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes payable in 2006 and
subsequent years.
new text end
Sec. 21.
Minnesota Statutes 2004, section 273.13, subdivision 22, is amended to read:
Subd. 22.
Class 1.
(a) Except as provided in subdivision 23 and in paragraphs (b)
and (c), real estate which is residential and used for homestead purposes is class 1a. In the
case of a duplex or triplex in which one of the units is used for homestead purposes, the
entire property is deemed to be used for homestead purposes. The market value of class 1a
property must be determined based upon the value of the house, garage, and land.
The first $500,000 of market value of class 1a property has a net class rate of
one percent of its market value; and the market value of class 1a property that exceeds
$500,000 has a class rate of 1.25 percent of its market value.
(b) Class 1b property includes homestead real estate or homestead manufactured
homes used for the purposes of a homestead by
(1) any person who is blind as defined in section 256D.35, or the blind person and
the blind person's spouse; or
(2) any person, hereinafter referred to as "veteran," who:
(i) served in the active military or naval service of the United States; and
(ii) is entitled to compensation under the laws and regulations of the United States
for permanent and total service-connected disability due to the loss, or loss of use, by
reason of amputation, ankylosis, progressive muscular dystrophies, or paralysis, of both
lower extremities, such as to preclude motion without the aid of braces, crutches, canes, or
a wheelchair; and
(iii) has acquired a special housing unit with special fixtures or movable facilities
made necessary by the nature of the veteran's disability, or the surviving spouse of the
deceased veteran for as long as the surviving spouse retains the special housing unit
as a homestead; or
(3) any person who is permanently and totally disabled.
Property is classified and assessed under clause (3) only if the government agency or
income-providing source certifies, upon the request of the homestead occupant, that the
homestead occupant satisfies the disability requirements of this paragraph.
Property is classified and assessed pursuant to clause (1) only if the commissioner of
revenue certifies to the assessor that the homestead occupant satisfies the requirements of
this paragraph.
Permanently and totally disabled for the purpose of this subdivision means a
condition which is permanent in nature and totally incapacitates the person from working
at an occupation which brings the person an income. The first deleted text begin $32,000 deleted text end new text begin $50,000 new text end market
value of class 1b property has a net class rate of .45 percent of its market value. The
remaining market value of class 1b property has a class rate using the rates for class 1a or
class 2a property, whichever is appropriate, of similar market value.
(c) Class 1c property is commercial use real property that abuts a lakeshore line and
is devoted to temporary and seasonal residential occupancy for recreational purposes but
not devoted to commercial purposes for more than 250 days in the year preceding the
year of assessment, and that includes a portion used as a homestead by the owner, which
includes a dwelling occupied as a homestead by a shareholder of a corporation that owns
the resort, a partner in a partnership that owns the resort, or a member of a limited liability
company that owns the resort even if the title to the homestead is held by the corporation,
partnership, or limited liability company. For purposes of this clause, property is devoted
to a commercial purpose on a specific day if any portion of the property, excluding the
portion used exclusively as a homestead, is used for residential occupancy and a fee is
charged for residential occupancy. The first deleted text begin $500,000 deleted text end new text begin $300,000 new text end of market value of class
1c property has a class rate of deleted text begin one deleted text end new text begin 0.55 new text end percent, and thedeleted text begin remaining deleted text end new text begin next $1,500,000 of
new text end market value of class 1c property has a class rate of one percentdeleted text begin , with the following
limitation: the area of the property must not exceed 100 feet of lakeshore footage for each
cabin or campsite located on the property up to a total of 800 feet and 500 feet in depth,
measured away from the lakeshoredeleted text end . new text begin Any remaining market value is class 4c property.new text end If
any portion of the class 1c resort property is classified as class 4c under subdivision 25,
the entire property must meet the requirements of subdivision 25, paragraph (d), clause
(1), to qualify for class 1c treatment under this paragraph.
(d) Class 1d property includes structures that meet all of the following criteria:
(1) the structure is located on property that is classified as agricultural property under
section 273.13, subdivision 23;
(2) the structure is occupied exclusively by seasonal farm workers during the time
when they work on that farm, and the occupants are not charged rent for the privilege of
occupying the property, provided that use of the structure for storage of farm equipment
and produce does not disqualify the property from classification under this paragraph;
(3) the structure meets all applicable health and safety requirements for the
appropriate season; and
(4) the structure is not salable as residential property because it does not comply
with local ordinances relating to location in relation to streets or roads.
The market value of class 1d property has the same class rates as class 1a property
under paragraph (a).
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes levied in 2005, payable
in 2006, and thereafter.
new text end
Sec. 22.
Minnesota Statutes 2004, section 273.13, subdivision 23, is amended to read:
Subd. 23.
Class 2.
(a) Class 2a property is agricultural land including any
improvements that is homesteaded. The market value of the house and garage and
immediately surrounding one acre of land has the same class rates as class 1a property
under subdivision 22. The value of the remaining land including improvements up to deleted text begin and
including $600,000 market value deleted text end new text begin $750,000 new text end has a net class rate of 0.55 percent of market
value. The remaining deleted text begin property deleted text end new text begin value new text end over deleted text begin $600,000 market value deleted text end new text begin $750,000 new text end has a class
rate of one percent of market value.
(b) Class 2b property is (1) real estate, rural in character and used exclusively for
growing trees for timber, lumber, and wood and wood products; (2) real estate that
is not improved with a structure and is used exclusively for growing trees for timber,
lumber, and wood and wood products, if the owner has participated or is participating in
a cost-sharing program for afforestation, reforestation, or timber stand improvement on
that particular property, administered or coordinated by the commissioner of natural
resources; (3) real estate that is nonhomestead agricultural land; or (4) a landing area or
public access area of a privately owned public use airport. Class 2b property has a net
class rate of one percent of market value.
(c) Agricultural land as used in this section means contiguous acreage of ten acres or
more, used during the preceding year for agricultural purposes. "Agricultural purposes" as
used in this section means the raising or cultivation of agricultural products. "Agricultural
purposes" also includes enrollment in the Reinvest in Minnesota program under sections
103F.501 to 103F.535 or the federal Conservation Reserve Program as contained in Public
Law 99-198 if the property was classified as agricultural (i) under this subdivision for
the assessment year 2002 or (ii) in the year prior to its enrollment. Contiguous acreage
on the same parcel, or contiguous acreage on an immediately adjacent parcel under the
same ownership, may also qualify as agricultural land, but only if it is pasture, timber,
waste, unusable wild land, or land included in state or federal farm programs. Agricultural
classification for property shall be determined excluding the house, garage, and
immediately surrounding one acre of land, and shall not be based upon the market value of
any residential structures on the parcel or contiguous parcels under the same ownership.
(d) Real estate, excluding the house, garage, and immediately surrounding one acre
of land, of less than ten acres which is exclusively and intensively used for raising or
cultivating agricultural products, shall be considered as agricultural land.
Land shall be classified as agricultural even if all or a portion of the agricultural use
of that property is the leasing to, or use by another person for agricultural purposes.
Classification under this subdivision is not determinative for qualifying under
section 273.111.
The property classification under this section supersedes, for property tax purposes
only, any locally administered agricultural policies or land use restrictions that define
minimum or maximum farm acreage.
(e) The term "agricultural products" as used in this subdivision includes production
for sale of:
(1) livestock, dairy animals, dairy products, poultry and poultry products, fur-bearing
animals, horticultural and nursery stock, fruit of all kinds, vegetables, forage, grains,
bees, and apiary products by the owner;
(2) fish bred for sale and consumption if the fish breeding occurs on land zoned
for agricultural use;
(3) the commercial boarding of horses if the boarding is done in conjunction with
raising or cultivating agricultural products as defined in clause (1);
(4) property which is owned and operated by nonprofit organizations used for
equestrian activities, excluding racing;
(5) game birds and waterfowl bred and raised for use on a shooting preserve licensed
under section 97A.115;
(6) insects primarily bred to be used as food for animals;
(7) trees, grown for sale as a crop, and not sold for timber, lumber, wood, or wood
products; and
(8) maple syrup taken from trees grown by a person licensed by the Minnesota
Department of Agriculture under chapter 28A as a food processor.
(f) If a parcel used for agricultural purposes is also used for commercial or industrial
purposes, including but not limited to:
(1) wholesale and retail sales;
(2) processing of raw agricultural products or other goods;
(3) warehousing or storage of processed goods; and
(4) office facilities for the support of the activities enumerated in clauses (1), (2),
and (3),
the assessor shall classify the part of the parcel used for agricultural purposes as class
1b, 2a, or 2b, whichever is appropriate, and the remainder in the class appropriate to its
use. The grading, sorting, and packaging of raw agricultural products for first sale is
considered an agricultural purpose. A greenhouse or other building where horticultural
or nursery products are grown that is also used for the conduct of retail sales must be
classified as agricultural if it is primarily used for the growing of horticultural or nursery
products from seed, cuttings, or roots and occasionally as a showroom for the retail sale of
those products. Use of a greenhouse or building only for the display of already grown
horticultural or nursery products does not qualify as an agricultural purpose.
The assessor shall determine and list separately on the records the market value of
the homestead dwelling and the one acre of land on which that dwelling is located. If any
farm buildings or structures are located on this homesteaded acre of land, their market
value shall not be included in this separate determination.
(g) To qualify for classification under paragraph (b), clause (4), a privately owned
public use airport must be licensed as a public airport under section 360.018. For purposes
of paragraph (b), clause (4), "landing area" means that part of a privately owned public use
airport properly cleared, regularly maintained, and made available to the public for use by
aircraft and includes runways, taxiways, aprons, and sites upon which are situated landing
or navigational aids. A landing area also includes land underlying both the primary surface
and the approach surfaces that comply with all of the following:
(i) the land is properly cleared and regularly maintained for the primary purposes of
the landing, taking off, and taxiing of aircraft; but that portion of the land that contains
facilities for servicing, repair, or maintenance of aircraft is not included as a landing area;
(ii) the land is part of the airport property; and
(iii) the land is not used for commercial or residential purposes.
The land contained in a landing area under paragraph (b), clause (4), must be described
and certified by the commissioner of transportation. The certification is effective until
it is modified, or until the airport or landing area no longer meets the requirements of
paragraph (b), clause (4). For purposes of paragraph (b), clause (4), "public access area"
means property used as an aircraft parking ramp, apron, or storage hangar, or an arrival
and departure building in connection with the airport.
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. 23.
Minnesota Statutes 2004, section 273.13, subdivision 25, is amended to read:
Subd. 25.
Class 4.
(a) Class 4a is residential real estate containing four or more
units and used or held for use by the owner or by the tenants or lessees of the owner
as a residence for rental periods of 30 days or morenew text begin , excluding property qualifying for
class 4dnew text end . Class 4a also includes hospitals licensed under sections 144.50 to 144.56, other
than hospitals exempt under section 272.02, and contiguous property used for hospital
purposes, without regard to whether the property has been platted or subdivided. The
market value of class 4a property has a class rate of deleted text begin 1.8 percent for taxes payable in 2002,
1.5 percent for taxes payable in 2003, and deleted text end 1.25 percent deleted text begin for taxes payable in 2004 and
thereafter, except that class 4a property consisting of a structure for which construction
commenced after June 30, 2001, has a class rate of 1.25 percent of market value for
taxes payable in 2003 and subsequent yearsdeleted text end .
(b) Class 4b includes:
(1) residential real estate containing less than four units that does not qualify as class
4bb, other than seasonal residential recreational property;
(2) manufactured homes not classified under any other provision;
(3) a dwelling, garage, and surrounding one acre of property on a nonhomestead
farm classified under subdivision 23, paragraph (b) containing two or three units; and
(4) unimproved property that is classified residential as determined under subdivision
33.
The market value of class 4b property has a class rate ofdeleted text begin 1.5 percent for taxes
payable in 2002, and deleted text end 1.25 percent deleted text begin for taxes payable in 2003 and thereafterdeleted text end .
(c) Class 4bb includes:
(1) nonhomestead residential real estate containing one unit, other than seasonal
residential recreational property; and
(2) a single family dwelling, garage, and surrounding one acre of property on a
nonhomestead farm classified under subdivision 23, paragraph (b).
Class 4bb property has the same class rates as class 1a property under subdivision 22.
Property that has been classified as seasonal residential recreational property at
any time during which it has been owned by the current owner or spouse of the current
owner does not qualify for class 4bb.
(d) Class 4c property includes:
(1) except as provided in subdivision 22, paragraph (c), real property devoted to
temporary and seasonal residential occupancy for recreation purposes, including real
property devoted to temporary and seasonal residential occupancy for recreation purposes
and not devoted to commercial purposes for more than 250 days in the year preceding
the year of assessment. For purposes of this clause, property is devoted to a commercial
purpose on a specific day if any portion of the property is used for residential occupancy,
and a fee is charged for residential occupancy. In order for a property to be classified as
class 4c, seasonal residential recreational for commercial purposes, at least 40 percent of
the annual gross lodging receipts related to the property must be from business conducted
during 90 consecutive days and either (i) at least 60 percent of all paid bookings by
lodging guests during the year must be for periods of at least two consecutive nights; or
(ii) at least 20 percent of the annual gross receipts must be from charges for rental of fish
houses, boats and motors, snowmobiles, downhill or cross-country ski equipment, or
charges for marina services, launch services, and guide services, or the sale of bait and
fishing tackle. For purposes of this determination, a paid booking of five or more nights
shall be counted as two bookings. Class 4c also includes commercial use real property
used exclusively for recreational purposes in conjunction with class 4c property devoted
to temporary and seasonal residential occupancy for recreational purposes, up to a total
of two acres, provided the property is not devoted to commercial recreational use for
more than 250 days in the year preceding the year of assessment and is located within
two miles of the class 4c property with which it is used. Class 4c property classified in
this clause also includes the remainder of class 1c resorts provided that the entire property
including that portion of the property classified as class 1c also meets the requirements for
class 4c under this clause; otherwise the entire property is classified as class 3. Owners
of real property devoted to temporary and seasonal residential occupancy for recreation
purposes and all or a portion of which was devoted to commercial purposes for not more
than 250 days in the year preceding the year of assessment desiring classification as class
1c or 4c, must submit a declaration to the assessor designating the cabins or units occupied
for 250 days or less in the year preceding the year of assessment by January 15 of the
assessment year. Those cabins or units and a proportionate share of the land on which
they are located will be designated class 1c or 4c as otherwise provided. The remainder of
the cabins or units and a proportionate share of the land on which they are located will
be designated as class 3a. The owner of property desiring designation as class 1c or 4c
property must provide guest registers or other records demonstrating that the units for
which class 1c or 4c designation is sought were not occupied for more than 250 days in
the year preceding the assessment if so requested. The portion of a property operated as
a (1) restaurant, (2) bar, (3) gift shop, and (4) other nonresidential facility operated on a
commercial basis not directly related to temporary and seasonal residential occupancy
for recreation purposes shall not qualify for class 1c or 4c;
(2) qualified property used as a golf course if:
(i) it is open to the public on a daily fee basis. It may charge membership fees or
dues, but a membership fee may not be required in order to use the property for golfing,
and its green fees for golfing must be comparable to green fees typically charged by
municipal courses; and
(ii) it meets the requirements of section 273.112, subdivision 3, paragraph (d).
A structure used as a clubhouse, restaurant, or place of refreshment in conjunction
with the golf course is classified as class 3a property;
(3) real property up to a maximum of one acre of land owned by a nonprofit
community service oriented organization; provided that the property is not used for a
revenue-producing activity for more than six days in the calendar year preceding the year
of assessment and the property is not used for residential purposes on either a temporary
or permanent basis. For purposes of this clause, a "nonprofit community service oriented
organization" means any corporation, society, association, foundation, or institution
organized and operated exclusively for charitable, religious, fraternal, civic, or educational
purposes, and which is exempt from federal income taxation pursuant to section 501(c)(3),
(10), or (19) of the Internal Revenue Code of 1986, as amended through December 31,
1990. For purposes of this clause, "revenue-producing activities" shall include but not be
limited to property or that portion of the property that is used as an on-sale intoxicating
liquor or 3.2 percent malt liquor establishment licensed under chapter 340A, a restaurant
open to the public, bowling alley, a retail store, gambling conducted by organizations
licensed under chapter 349, an insurance business, or office or other space leased or
rented to a lessee who conducts a for-profit enterprise on the premises. Any portion of
the property which is used for revenue-producing activities for more than six days in the
calendar year preceding the year of assessment shall be assessed as class 3a. The use of
the property for social events open exclusively to members and their guests for periods of
less than 24 hours, when an admission is not charged nor any revenues are received by the
organization shall not be considered a revenue-producing activity;
(4) postsecondary student housing of not more than one acre of land that is owned by
a nonprofit corporation organized under chapter 317A and is used exclusively by a student
cooperative, sorority, or fraternity for on-campus housing or housing located within two
miles of the border of a college campus;
(5) manufactured home parks as defined in section 327.14, subdivision 3;
(6) real property that is actively and exclusively devoted to indoor fitness, health,
social, recreational, and related uses, is owned and operated by a not-for-profit corporation,
and is located within the metropolitan area as defined in section 473.121, subdivision 2;
(7) a leased or privately owned noncommercial aircraft storage hangar not exempt
under section 272.01, subdivision 2, and the land on which it is located, provided that:
(i) the land is on an airport owned or operated by a city, town, county, Metropolitan
Airports Commission, or group thereof; and
(ii) the land lease, or any ordinance or signed agreement restricting the use of the
leased premise, prohibits commercial activity performed at the hangar.
If a hangar classified under this clause is sold after June 30, 2000, a bill of sale must
be filed by the new owner with the assessor of the county where the property is located
within 60 days of the sale; deleted text begin and
deleted text end
(8) new text begin a privately owned noncommercial aircraft storage hangar not exempt under
section 272.01, subdivision 2, and the land on which it is located, provided that:
new text end
new text begin
(i) the land abuts a public airport; and
new text end
new text begin
(ii) the owner of the aircraft storage hangar provides the assessor with a signed
agreement restricting the use of the premises, prohibiting commercial use or activity
performed at the hangar; and
new text end
new text begin (9) new text end residential real estate, a portion of which is used by the owner for homestead
purposes, and that is also a place of lodging, if all of the following criteria are met:
(i) rooms are provided for rent to transient guests that generally stay for periods
of 14 or fewer days;
(ii) meals are provided to persons who rent rooms, the cost of which is incorporated
in the basic room rate;
(iii) meals are not provided to the general public except for special events on fewer
than seven days in the calendar year preceding the year of the assessment; and
(iv) the owner is the operator of the property.
The market value subject to the 4c classification under this clause is limited to five rental
units. Any rental units on the property in excess of five, must be valued and assessed as
class 3a. The portion of the property used for purposes of a homestead by the owner must
be classified as class 1a property under subdivision 22.
Class 4c property has a class rate of 1.5 percent of market value, except that (i) each
parcel of seasonal residential recreational property not used for commercial purposes has
the same class rates as class 4bb property, (ii) manufactured home parks assessed under
clause (5) have the same class rate as class 4b property, (iii) commercial-use seasonal
residential recreational property has a class rate of one percent for the first $500,000
of market value, which includes any market value receiving the one percent rate under
subdivision 22, and 1.25 percent for the remaining market value, (iv) the market value
of property described in clause (4) has a class rate of one percent, (v) the market value
of property described in clauses (2) and (6) has a class rate of 1.25 percent, and (vi) that
portion of the market value of property in clause (8) qualifying for class 4c property
has a class rate of 1.25 percent.
new text begin
(e) Class 4d property is qualifying low-income rental housing certified to the assessor
by the Housing Finance Agency under section 273.126, subdivision 3. If only a portion
of the units in the building qualify as low-income rental housing units as certified under
section 273.126, subdivision 3, only the proportion of qualifying units to the total number
of units in the building qualify for class 4d. The remaining portion of the building shall be
classified by the assessor based upon its use. Class 4d also includes the same proportion of
land as the qualifying low-income rental housing units are to the total units in the building.
For all properties qualifying as class 4d, the market value determined by the assessor must
be based on the normal approach to value using normal unrestricted rents.
new text end
new text begin
Class 4d property has a class rate of 1.0 percent.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes payable in 2006 and
subsequent years.
new text end
Sec. 24.
Minnesota Statutes 2004, section 273.13, is amended by adding a subdivision
to read:
new text begin Subd. 34. new text end
new text begin Homestead of disabled veteran or surviving spouse. new text end
new text begin
(a) The first
$200,000 of market value of property qualifying for homestead classification under
subdivision 22 or 23 is excluded in determining the property's taxable market value if
it serves as the homestead of a military veteran, as defined in section 197.447, who
has a total and permanent service-connected disability. To qualify for exclusion under
this subdivision, the veteran must have been honorably discharged from the United
States armed forces, as indicated by United States Government Form DD214 or other
official military discharge papers, and must be certified by the United States Veterans
Administration as having a total (100 percent) and permanent service-connected disability.
new text end
new text begin
(b) If a disabled veteran qualifying for a valuation exclusion under paragraph (a)
predeceases the veteran's spouse, and if upon the death of the veteran the spouse holds the
legal or beneficial title to the homestead and permanently resides there, the exclusion shall
carry over to the benefit of the veteran's spouse until such time as the spouse remarries or
sells or otherwise disposes of the property.
new text end
new text begin
(c) In the case of an agricultural homestead, only the portion of the property
consisting of the house and garage and immediately surrounding one acre of land qualifies
for the valuation exclusion under this subdivision.
new text end
new text begin
(d) A property owner attempting to first qualify for a valuation exclusion under this
subdivision must apply to the assessor by July 1 of the assessment year, except that for
assessment year 2005 application may be made until September 1, 2005. The application
must be accompanied by supporting documentation as required by the assessor. Once a
property has been accepted for a valuation exclusion under this subdivision, the property
continues to qualify until there is a change in ownership of the property.
new text end
new text begin
(e) The value of any qualifying property in excess of $200,000 must be treated
exactly the same as if the first $200,000 in value had not been excluded, for purposes of
determining the appropriate class rate. A property qualifying for exclusion under this
subdivision shall not be eligible for the credit under section 273.1384, subdivision 1.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for assessment year 2005 and
thereafter, for taxes payable in 2006 and thereafter.
new text end
Sec. 25.
Minnesota Statutes 2004, section 274.01, subdivision 1, is amended to read:
Subdivision 1.
Ordinary board; meetings, deadlines, grievances.
(a) The town
board of a town, or the council or other governing body of a city, is the board of appeal
and equalization except (1) in cities whose charters provide for a board of equalization or
(2) in any city or town that has transferred its local board of review power and duties to
the county board as provided in subdivision 3. The county assessor shall fix a day and
time when the board or the board of equalization shall meet in the assessment districts
of the county. Notwithstanding any law or city charter to the contrary, a city board of
equalization shall be referred to as a board of appeal and equalization. On or before
February 15 of each year the assessor shall give written notice of the time to the city or
town clerk. Notwithstanding the provisions of any charter to the contrary, the meetings
must be held between April 1 and May 31 each year. The clerk shall give published and
posted notice of the meeting at least ten days before the date of the meeting.
The board shall meet at the office of the clerk to review the assessment and
classification of property in the town or city. No changes in valuation or classification
which are intended to correct errors in judgment by the county assessor may be made by
the county assessor after the board has adjourned in those cities or towns that hold a
local board of review; however, corrections of errors that are merely clerical in nature or
changes that extend homestead treatment to property are permitted after adjournment until
the tax extension date for that assessment year. The changes must be fully documented and
maintained in the assessor's office and must be available for review by any person. A copy
of the changes made during this period in those cities or towns that hold a local board of
review must be sent to the county board no later than December 31 of the assessment year.
(b) The board shall determine whether the taxable property in the town or city has
been properly placed on the list and properly valued by the assessor. If real or personal
property has been omitted, the board shall place it on the list with its market value, and
correct the assessment so that each tract or lot of real property, and each article, parcel,
or class of personal property, is entered on the assessment list at its market value. No
assessment of the property of any person may be raised unless the person has been duly
notified of the intent of the board to do so. On application of any person feeling aggrieved,
the board shall review the assessment or classification, or both, and correct it as appears
just. deleted text begin The board may not make an individual market value adjustment or classification
change that would benefit the property in cases where the owner or other person having
control over the property will not permit the assessor to inspect the property and the
interior of any buildings or structures.
deleted text end
(c) A local board may reduce assessments upon petition of the taxpayer but the total
reductions must not reduce the aggregate assessment made by the county assessor by more
than one percent. If the total reductions would lower the aggregate assessments made by
the county assessor by more than one percent, none of the adjustments may be made. The
assessor shall correct any clerical errors or double assessments discovered by the board
without regard to the one percent limitation.
(d) A local board does not have authority to grant an exemption or to order property
removed from the tax rolls.
(e) A majority of the members may act at the meeting, and adjourn from day to day
until they finish hearing the cases presented. The assessor shall attend, with the assessment
books and papers, and take part in the proceedings, but must not vote. The county assessor,
or an assistant delegated by the county assessor shall attend the meetings. The board shall
list separately, on a form appended to the assessment book, all omitted property added
to the list by the board and all items of property increased or decreased, with the market
value of each item of property, added or changed by the board, placed opposite the item.
The county assessor shall enter all changes made by the board in the assessment book.
(f) Except as provided in subdivision 3, if a person fails to appear in person, by
counsel, or by written communication before the board after being duly notified of the
board's intent to raise the assessment of the property, or if a person feeling aggrieved by an
assessment or classification fails to apply for a review of the assessment or classification,
the person may not appear before the county board of appeal and equalization for a review
of the assessment or classification. This paragraph does not apply if an assessment was
made after the local board meeting, as provided in section 273.01, or if the person can
establish not having received notice of market value at least five days before the local
board meeting.
(g) The local board must complete its work and adjourn within 20 days from the
time of convening stated in the notice of the clerk, unless a longer period is approved by
the commissioner of revenue. No action taken after that date is valid. All complaints
about an assessment or classification made after the meeting of the board must be heard
and determined by the county board of equalization. A nonresident may, at any time,
before the meeting of the board file written objections to an assessment or classification
with the county assessor. The objections must be presented to the board at its meeting by
the county assessor for its consideration.
Sec. 26.
Minnesota Statutes 2004, section 275.025, subdivision 4, is amended to read:
Subd. 4.
Apportionment and levy of state general tax.
new text begin Ninety-five percent of
new text end the state general tax must be deleted text begin distributed among the counties deleted text end new text begin levied new text end by applying a uniform
rate to deleted text begin each county's deleted text end new text begin all new text end commercial-industrial tax capacity and deleted text begin its deleted text end new text begin five percent of the
state general tax must be levied by applying a uniform rate to all new text end seasonal residential
recreational tax capacity. deleted text begin Within each county, the tax must be levied by applying a uniform
rate against commercial-industrial tax capacity and seasonal residential recreational tax
capacity.deleted text end On or before October 1 each year, the commissioner of revenue shall certify deleted text begin a
deleted text end new text begin the new text end preliminary state general levy deleted text begin rate deleted text end new text begin rates new text end to each county auditor that must be used to
prepare the notices of proposed property taxes for taxes payable in the following year. By
January 1 of each year, the commissioner shall certify the final state general levy rate to
each county auditor that shall be used in spreading taxes.
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. 27.
Minnesota Statutes 2004, section 276.04, subdivision 2, is amended to read:
Subd. 2.
Contents of tax statements.
(a) The treasurer shall provide for the
printing of the tax statements. The commissioner of revenue shall prescribe the form
of the property tax statement and its contents. The statement must contain a tabulated
statement of the dollar amount due to each taxing authority and the amount of the state
tax from the parcel of real property for which a particular tax statement is prepared. The
dollar amounts attributable to the county, the state tax, the voter approved school tax, the
other local school tax, the township or municipality, and the total of the metropolitan
special taxing districts as defined in section 275.065, subdivision 3, paragraph (i), must
be separately stated. The amounts due all other special taxing districts, if any, may be
aggregated new text begin except that any levies made by the regional rail authorities in the county of
Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter 398A
shall be listed on a separate line directly under the appropriate county's levynew text end . If the county
levy under this paragraph includes an amount for a lake improvement district as defined
under sections 103B.501 to 103B.581, the amount attributable for that purpose must be
separately stated from the remaining county levy amount. new text begin In the case of Ramsey County,
if the county levy under this paragraph includes an amount for public library service
under section 134.07, the amount attributable for that purpose may be separated from the
remaining county levy amount.new text end The amount of the tax on homesteads qualifying under the
senior citizens' property tax deferral program under chapter 290B is the total amount of
property tax before subtraction of the deferred property tax amount. The amount of the
tax on contamination value imposed under sections 270.91 to 270.98, if any, must also
be separately stated. The dollar amounts, including the dollar amount of any special
assessments, may be rounded to the nearest even whole dollar. For purposes of this section
whole odd-numbered dollars may be adjusted to the next higher even-numbered dollar.
The amount of market value excluded under section 273.11, subdivision 16, if any, must
also be listed on the tax statement.
(b) The property tax statements for manufactured homes and sectional structures
taxed as personal property shall contain the same information that is required on the
tax statements for real property.
(c) Real and personal property tax statements must contain the following information
in the order given in this paragraph. The information must contain the current year tax
information in the right column with the corresponding information for the previous year
in a column on the left:
(1) the property's estimated market value under section 273.11, subdivision 1;
(2) the property's taxable market value after reductions under section 273.11,
subdivisions 1a and 16;
(3) the property's gross tax, calculated by adding the property's total property tax to
the sum of the aids enumerated in clause (4);
(4) a total of the following aids:
(i) education aids payable under chapters 122A, 123A, 123B, 124D, 125A, 126C,
and 127A;
(ii) local government aids for cities, towns, and counties under deleted text begin chapter 477A
deleted text end new text begin sections 477A.011 to 477A.04new text end ; and
(iii) disparity reduction aid under section 273.1398;
(5) for homestead residential and agricultural properties, the credits under section
273.1384;
(6) any credits received under sections 273.119; 273.123; 273.135; 273.1391;
273.1398, subdivision 4; 469.171; and 473H.10, except that the amount of credit received
under section 273.135 must be separately stated and identified as "taconite tax relief"; and
(7) the net tax payable in the manner required in paragraph (a).
(d) If the county uses envelopes for mailing property tax statements and if the county
agrees, a taxing district may include a notice with the property tax statement notifying
taxpayers when the taxing district will begin its budget deliberations for the current
year, and encouraging taxpayers to attend the hearings. If the county allows notices to
be included in the envelope containing the property tax statement, and if more than
one taxing district relative to a given property decides to include a notice with the tax
statement, the county treasurer or auditor must coordinate the process and may combine
the information on a single announcement.
The commissioner of revenue shall certify to the county auditor the actual or
estimated aids enumerated in clause (4) that local governments will receive in the
following year. The commissioner must certify this amount by January 1 of each year.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for property tax statements for taxes
payable in 2006 and thereafter.
new text end
Sec. 28.
new text begin
[280.44] NOTIFICATION TO HOMESTEAD PROPERTY OWNERS;
TAX DELINQUENCY.
new text end
new text begin
In addition to other notices required under this chapter, the county auditor shall
notify all taxpayers owning homestead property within the county whose real property
taxes on that homestead are currently delinquent and also were delinquent in the preceding
calendar year. The notification must be mailed sometime between June 1 and August 1
in the year following the second year that property taxes were not paid. The notification
must contain a telephone number and an e-mail address for the county auditor's office
to aid the taxpayer in contacting the county to discuss any questions relating to the tax
delinquency. The notification must contain a list of the various assistance programs
and other options that might be available to the taxpayer to pay the delinquent taxes
including, but not limited to, the senior citizens' property tax deferral under chapter 290B,
partial property tax payments, and a confession of judgment under section 279.37. The
notice must inform the taxpayer of the state-paid property tax refund and the additional
property tax refund under chapter 290A which may be available to the taxpayer once the
delinquent taxes have been satisfied. The notice must also state the number of years before
the property will forfeit if the taxes are not paid or any installment plan initiated. For
purposes of this section, "homestead" property means property classified under section
273.13, subdivision 22 or 23, paragraph (a).
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for property tax delinquencies
beginning January 1, 2006, provided that for calendar year 2006, the county auditor shall
notify the owners of each homestead property in the county that has been delinquent for
two or more years.
new text end
Sec. 29.
Minnesota Statutes 2004, section 290A.03, subdivision 11, is amended to read:
Subd. 11.
Rent constituting property taxes.
"Rent constituting property taxes"
means deleted text begin 19 percent of the gross rent actually paid in cash, or its equivalent, or the portion of
rent deleted text end new text begin the amount of gross rent actually paid in cash, or its equivalent, which is attributable
(1) to the property tax paid on the unit or (2) to the amount new text end paid in lieu of property taxes,
in any calendar year by a claimant for the right of occupancy of the claimant's Minnesota
homestead in the calendar year, and which rent constitutes the basis, in the succeeding
calendar year of a claim for relief under this chapter by the claimant. new text begin The amount of
rent attributable to property taxes paid or payments in lieu made on the unit must be
determined by multiplying the gross rent paid by the claimant for the calendar year for the
unit by a fraction, the numerator of which is the net tax on the property where the unit
is located and the denominator of which is the total scheduled rent. In no case may the
rent constituting property taxes exceed 50 percent of the gross rent paid by the claimant
during that calendar year. In the case of a claimant who resides in a unit for which (1)
a rent subsidy is paid to, or for, the claimant based on the income of the claimant or the
claimant's family, or (2) a subsidy is paid to a public housing authority that owns or
operates the claimant's rental unit, pursuant to United States Code, title 42, section 1437c,
20 percent of gross rent actually paid in cash or its equivalent shall be the claimant's "rent
constituting property taxes paid." For purposes of this subdivision, "rent subsidy" does not
include any housing assistance received under the Minnesota family investment program,
general assistance, Minnesota supplemental assistance, supplemental security income,
or similar income maintenance programs.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for claims based on rent paid in
2005 and following years.
new text end
Sec. 30.
Minnesota Statutes 2004, section 290A.03, subdivision 13, is amended to read:
Subd. 13.
Property taxes payable.
"Property taxes payable" means the property
tax exclusive of special assessments, penalties, and interest payable on a claimant's
homestead after deductions made under sections 273.135, 273.1384, 273.1391, 273.42,
subdivision 2, and any other state paid property tax credits in any calendar year, and
after any refund claimed and allowable under section 290A.04, subdivision 2h, that is
first payable in the year that the property tax is payable. In the case of a claimant who
makes ground lease payments, "property taxes payable" includes the amount of the
payments directly attributable to the property taxes assessed against the parcel on which
the house is located. No apportionment or reduction of the "property taxes payable" shall
be required for the use of a portion of the claimant's homestead for a business purpose if
the claimant does not deduct any business depreciation expenses for the use of a portion
of the homestead in the determination of federal adjusted gross income. For homesteads
which are manufactured homes as defined in section 273.125, subdivision 8, and for
homesteads which are park trailers taxed as manufactured homes under section 168.012,
subdivision 9, "property taxes payable" shall also include deleted text begin 19 percent deleted text end new text begin the amount new text end of the
gross rent paid in the preceding year for the site on which the homestead is locatednew text begin , which
is attributable to the net tax paid on the site. The amount attributable to property taxes
must be determined by multiplying the net tax on the parcel by a fraction, the numerator
of which is the gross rent paid for the calendar year for the site and the denominator
of which is the gross rent paid for the calendar year for the parcelnew text end . When a homestead
is owned by two or more persons as joint tenants or tenants in common, such tenants
shall determine between them which tenant may claim the property taxes payable on the
homestead. If they are unable to agree, the matter shall be referred to the commissioner of
revenue whose decision shall be final. Property taxes are considered payable in the year
prescribed by law for payment of the taxes.
In the case of a claim relating to "property taxes payable," the claimant must have
owned and occupied the homestead on January 2 of the year in which the tax is payable
and (i) the property must have been classified as homestead property pursuant to section
273.124, on or before December 15 of the assessment year to which the "property taxes
payable" relate; or (ii) the claimant must provide documentation from the local assessor
that application for homestead classification has been made on or before December 15
of the year in which the "property taxes payable" were payable and that the assessor has
approved the application.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for claims based on rent paid in
2005 and following years.
new text end
Sec. 31.
Minnesota Statutes 2004, section 290A.03, is amended by adding a
subdivision to read:
new text begin Subd. 16. new text end
new text begin Total scheduled rent. new text end
new text begin
"Total scheduled rent" means the sum of the
monthly rents assigned to the residential rental units in the property multiplied by 12. The
rents must be an arm's-length rental, including garage rents if any, but not including
charges for medical services furnished by the landlord as a part of the rental agreement. In
determining total scheduled rent, no deduction is allowed for vacant units, uncollected
rent, or reduced cash rents in units occupied by employees or agents of the owner.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for claims based on rent paid in
2005 and following years.
new text end
Sec. 32.
Minnesota Statutes 2004, section 290A.03, is amended by adding a
subdivision to read:
new text begin Subd. 17. new text end
new text begin Net tax. new text end
new text begin
"Net tax" means:
new text end
new text begin
(1) the property tax, exclusive of special assessments, interest, and penalties, and
after reduction for any state paid property tax credits as required in subdivision 13 except
for the reduction under section 273.13, subdivisions 22 and 23; or
new text end
new text begin
(2) the payments made in lieu of ad valorem taxes, including payments of special
assessments imposed in lieu of ad valorem taxes,
new text end
new text begin
for the calendar year in which the rent was paid. If a portion of the property is occupied
as a homestead or is used for other than rental purposes, the net tax is the amount of tax
reduced by the percentage that the nonrental use comprises of the total square footage of
the building. If a portion of the property is used for purposes other than for residential
rental and none of the property is occupied as a homestead, the net tax is the amount of the
tax of the parcel multiplied by a fraction, the numerator of which is the net tax capacity of
the residential rental portion and the denominator of which is the total net tax capacity of
the parcel. If a portion of the property is used for other than rental residential purposes, the
county treasurer shall list on the property tax statement the amount of net tax pertaining to
the rental residential portion of the property.
new text end
new text begin
The amount of the net tax must not be reduced by an abatement or a court-ordered
reduction in the property tax on the property made after the certificate of rent paid has
been provided to the renter.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for claims based on rent paid in
2005 and following years.
new text end
Sec. 33.
Minnesota Statutes 2004, section 290A.07, is amended by adding a
subdivision to read:
new text begin Subd. 5. new text end
new text begin Early payment; e-file claims. new text end
new text begin
The commissioner may pay a claim up
to 30 days earlier than the first permitted date under subdivision 2a or 3 if the claim is
submitted by electronic means.
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. 34.
Minnesota Statutes 2004, section 290A.19, is amended to read:
290A.19 OWNER OR MANAGING AGENT TO FURNISH RENT
CERTIFICATE.
new text begin (a) new text end The owner or managing agent of any property for which rent is paid for
occupancy as a homestead must furnish a certificate of rent paid to a person who is a
renter on December 31, in the form prescribed by the commissioner. If the renter moves
before December 31, the owner or managing agent may give the certificate to the renter
at the time of moving, or mail the certificate to the forwarding address if an address has
been provided by the renter. The certificate must be made available to the renter before
February 1 of the year following the year in which the rent was paid. The owner or
managing agent must retain a duplicate of each certificate or an equivalent record showing
the same information for a period of three years. The duplicate or other record must
be made available to the commissioner upon request. For the purposes of this section,
"owner" includes a park owner as defined under section 327C.01, subdivision 6, and
"property" includes a lot as defined under section 327C.01, subdivision 3.
new text begin
(b) If the owner or managing agent fails to provide the renter with a certificate of
rent constituting property taxes, the commissioner shall allocate the net tax on the building
to the unit on a square footage basis or other appropriate basis as the commissioner
determines. The renter shall supply the commissioner with a statement from the county
treasurer that gives the amount of property tax on the parcel, the address and property tax
parcel identification number of the property, and the number of units in the building.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for claims based on rent paid in
2005 and following years.
new text end
Sec. 35.
Minnesota Statutes 2004, section 365.43, subdivision 1, is amended to read:
Subdivision 1.
deleted text begin levied amount is spending limit deleted text end new text begin total revenue definednew text end .
A town
must not deleted text begin contract debts or deleted text end spend more money in a year than deleted text begin the taxes levied for the year
deleted text end new text begin its total revenue new text end without a favorable vote of a majority of the town's electors. new text begin In this
section, "total revenue" means property taxes payable in that year as well as amounts
received from all other sources and amounts carried forward from the last year.
new text end
Sec. 36.
Minnesota Statutes 2004, section 365.431, is amended to read:
365.431 AMOUNT VOTED AT MEETING IS TAX LIMIT.
new text begin Except as otherwise authorized by law,new text end the tax for town purposes must not be more
than the amount voted to be raised at the annual town meeting.
Sec. 37.
Minnesota Statutes 2004, section 366.011, is amended to read:
366.011 CHARGES FOR EMERGENCY SERVICES; COLLECTION.
A town may impose a reasonable service charge for emergency services, including
fire, rescue, medical, and related services provided by the town or contracted for by the
town. If the service charge remains unpaid 30 days after a notice of delinquency is sent
to the recipient of the service or the recipient's representative or estate, the town or its
contractor on behalf of the town may use any lawful means allowed to a private party for
the collection of an unsecured delinquent debt. The town may also use the authority of
section 366.012 to collect unpaid service charges of this kind from delinquent recipients of
services who are owners of taxable real property in the deleted text begin town deleted text end new text begin statenew text end .
The powers conferred by this section are in addition and supplemental to the powers
conferred by any other law for a town to impose a service charge or assessment for a
service provided by the town or contracted for by the town.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 38.
Minnesota Statutes 2004, section 366.012, is amended to read:
366.012 COLLECTION OF UNPAID SERVICE CHARGES.
If a town is authorized to impose a service charge deleted text begin on the owner, lessee, or occupant
of property, or any of them,deleted text end for a governmental service provided by the town, the town
board may certify to the county auditor new text begin of the county in which the recipient of the services
owns real propertynew text end , on or before October 15 for each year, any unpaid service charges
which shall then be collected together with property taxes levied against the property. new text begin The
county auditor shall remit to the town all service charges collected by the auditor on behalf
of the town.new text end A charge may be certified to the auditor only if, on or before September 15,
the town has given written notice to the property owner of its intention to certify the
charge to the auditor. The service charges shall be subject to the same penalties, interest,
and other conditions provided for the collection of property taxes. This section is in
addition to other law authorizing the collection of unpaid costs and service charges.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 39.
new text begin
[373.251] LEVY FOR NON-COUNTY-OWNED PUBLIC NURSING
HOMES.
new text end
new text begin
(a) If a county with a population of 150,000 or more, according to the 2000 Federal
Census, located outside the metropolitan area as defined in section 473.121, subdivision
2, owns a nursing home that is funded in whole or part with county revenue, the county
must levy an equal amount annually to be distributed to all other nursing homes located
within the county that are owned by governmental units.
new text end
new text begin
(b) The proceeds of the levy authorized by paragraph (a) must be prorated among
the government-owned nursing homes in the proportion that the number of beds in each
of the government-owned nursing homes is to the total number of beds in all of the
government-owned nursing homes in the county.
new text end
new text begin
(c) The levy authorized by paragraph (a) may be levied in addition to all other
county levies authorized by law.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes levied in 2006, payable in
2007 and thereafter.
new text end
Sec. 40.
Minnesota Statutes 2004, section 473F.02, subdivision 2, is amended to read:
Subd. 2.
Area.
"Area" means the territory included within the boundaries of Anoka,
Carver, Dakota excluding the city of Northfield, Hennepin, Ramsey, Scott excluding the
city of New Prague, and Washington Countiesnew text begin , excluding lands constituting a major or
an intermediate airport as defined under section 473.625new text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes payable in 2006 and
subsequent years.
new text end
Sec. 41.
Minnesota Statutes 2004, section 477A.11, subdivision 4, is amended to read:
Subd. 4.
Other natural resources land.
"Other natural resources land" meansdeleted text begin :
deleted text end
deleted text begin (1) deleted text end any other land presently owned in fee title by the state and administered by the
commissioner, or any tax-forfeited land, other than platted lots within a city or those lands
described under subdivision 3, clause (2), which is owned by the state and administered by
the commissioner or by the county in which it is locateddeleted text begin ; and
deleted text end
deleted text begin (2) land leased by the state from the United States of America through the United
States Secretary of Agriculture pursuant to Title III of the Bankhead Jones Farm
Tenant Act, which land is commonly referred to as land utilization project land that is
administered by the commissionerdeleted text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for aids paid in calendar year 2006
and thereafter.
new text end
Sec. 42.
Minnesota Statutes 2004, section 477A.11, is amended by adding a
subdivision to read:
new text begin Subd. 5. new text end
new text begin Land utilization project land. new text end
new text begin
"Land utilization project land" means land
that is leased by the state from the United States through the United States Secretary of
Agriculture according to Title III of the Bankhead Jones Farm Tenant Act and that is
administered by the commissioner.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for aids paid in calendar year 2006
and thereafter.
new text end
Sec. 43.
Minnesota Statutes 2004, section 477A.12, subdivision 1, is amended to read:
Subdivision 1.
Types of land; payments.
(a) As an offset for expenses incurred
by counties and towns in support of natural resources lands, the following amounts are
annually appropriated to the commissioner of natural resources from the general fund for
transfer to the commissioner of revenue. The commissioner of revenue shall pay the
transferred funds to counties as required by sections 477A.11 to 477A.145. The amounts
are:
(1) for acquired natural resources land, $3, as adjusted for inflation under section
477A.145, multiplied by the total number of acres of acquired natural resources land or,
at the county's option three-fourths of one percent of the appraised value of all acquired
natural resources land in the county, whichever is greater;
(2) 75 cents, as adjusted for inflation under section 477A.145, multiplied by the
number of acres of county-administered other natural resources land; and
new text begin
(3) 75 cents, as adjusted for inflation under section 477A.145, multiplied by the total
number of acres of land utilization project land;
new text end
deleted text begin (3) deleted text end new text begin (4) new text end 37.5 cents, as adjusted for inflation under section 477A.145, multiplied by
the number of acres of commissioner-administered other natural resources land located in
each county as of July 1 of each year prior to the payment year.
(b) The amount determined under paragraph (a), clause (1), is payable for land
that is acquired from a private owner and owned by the Department of Transportation
for the purpose of replacing wetland losses caused by transportation projects, but only
if the county contains more than 500 acres of such land at the time the certification is
made under subdivision 2.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for aids paid in calendar year 2006
and thereafter.
new text end
Sec. 44.
Minnesota Statutes 2004, section 477A.12, subdivision 2, is amended to read:
Subd. 2.
Procedure.
Lands for which payments in lieu are made pursuant to
section 97A.061, subdivision 3, and Laws 1973, chapter 567, shall not be eligible for
payments under this section. Each county auditor shall certify to the Department of
Natural Resources during July of each year prior to the payment year the number of acres
of county-administered other natural resources land within the county. The Department of
Natural resources may, in addition to the certification of acreage, require descriptive lists
of land so certified. The commissioner of natural resources shall determine and certify to
the commissioner of revenue by March 1 of the payment year:
(1) the number of acres and most recent appraised value of acquired natural
resources land within each county;
(2) the number of acres of commissioner-administered natural resources land within
each county; deleted text begin and
deleted text end
(3) the number of acres of county-administered other natural resources land within
each county, based on the reports filed by each county auditor with the commissioner
of natural resourcesnew text begin ; and
new text end
new text begin (4) the number of acres of land utilization project land within each countynew text end .
The commissioner of transportation shall determine and certify to the commissioner
of revenue by March 1 of the payment year the number of acres of land and the appraised
value of the land described in subdivision 1, paragraph (b), but only if it exceeds 500 acres.
The commissioner of revenue shall determine the distributions provided for in this
section using the number of acres and appraised values certified by the commissioner of
natural resources and the commissioner of transportation by March 1 of the payment year.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for aids paid in calendar year 2006
and thereafter.
new text end
Sec. 45.
Minnesota Statutes 2004, section 477A.14, subdivision 1, is amended to read:
Subdivision 1.
General distribution.
Except as provided in subdivision 2 or in
section 97A.061, subdivision 5, 40 percent of the total payment to the county shall be
deposited in the county general revenue fund to be used to provide property tax levy
reduction. The remainder shall be distributed by the county in the following priority:
(a) 37.5 cents, as adjusted for inflation under section 477A.145, for each acre
of county-administered other natural resources land shall be deposited in a resource
development fund to be created within the county treasury for use in resource
development, forest management, game and fish habitat improvement, and recreational
development and maintenance of county-administered other natural resources land. Any
county receiving less than $5,000 annually for the resource development fund may elect to
deposit that amount in the county general revenue fund;
(b) From the funds remaining, within 30 days of receipt of the payment to the county,
the county treasurer shall pay each organized township 30 cents, as adjusted for inflation
under section 477A.145, for each acre of acquired natural resources land and each acre of
land described in section 477A.12, subdivision 1, paragraph (b), and 7.5 cents, as adjusted
for inflation under section 477A.145, for each acre of other natural resources land new text begin and each
acre of land utilization project land new text end located within its boundaries. Payments for natural
resources lands not located in an organized township shall be deposited in the county
general revenue fund. Payments to counties and townships pursuant to this paragraph shall
be used to provide property tax levy reduction, except that of the payments for natural
resources lands not located in an organized township, the county may allocate the amount
determined to be necessary for maintenance of roads in unorganized townships. Provided
that, if the total payment to the county pursuant to section 477A.12 is not sufficient to fully
fund the distribution provided for in this clause, the amount available shall be distributed
to each township and the county general revenue fund on a pro rata basis; and
(c) Any remaining funds shall be deposited in the county general revenue fund.
Provided that, if the distribution to the county general revenue fund exceeds $35,000, the
excess shall be used to provide property tax levy reduction.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for aids paid in calendar year 2006
and thereafter.
new text end
Sec. 46.
Laws 1998, chapter 389, article 3, section 42, subdivision 2, as amended by
Laws 2002, chapter 377, article 4, section 24, is amended to read:
Subd. 2.
Recapture.
(a) Property or any portion thereof qualifying under section 38
is subject to additional taxes if:
(1) ownership of the property is transferred to anyone other than the spouse or
child of the current owner;
(2) the current owner or the spouse or child of the current owner has not conveyed or
entered into a contract before July 1, 2007, to convey new text begin for ownership or public easement
rights, (i) a portion of new text end the property to deleted text begin a deleted text end new text begin one or more new text end nonprofit deleted text begin foundation deleted text end new text begin foundations new text end or
deleted text begin corporation operating deleted text end new text begin corporations; and (ii) a portion of the property to one or more local
governments; and those entities shall separately or jointly operate new text end the property as an art
park providing the services included in section 38, clauses (2) to (5)new text begin , and may also use
some of the property for other public purposes as determined by the local governmentsnew text end ; or
(3) the nonprofit foundation or corporation to which new text begin a portion of new text end the property was
transferred ceases to provide the services included in section 38, clauses (2) to (5), earlier
than ten years following the effective date of the deleted text begin conveyance deleted text end new text begin conveyances new text end or of the
execution of the deleted text begin contract deleted text end new text begin contracts new text end to convey.
(b) The additional taxes are imposed at the earlier of (1) the year following transfer
of ownership to anyone other than the spouse or child of the current owner or a nonprofit
foundation or corporation new text begin or local government new text end operating the property as an art park new text begin and
used for other public purposesnew text end , or (2) for taxes payable in 2008, or new text begin (3) new text end in the event the
nonprofit foundation or corporation to which new text begin a portion of new text end the property was conveyed
ceases to provide the required services within ten years after the conveyance, for taxes
payable in the year following the year when it ceased to do so.
new text begin The county board, with the approval of the city council, shall determine the amount
of the additional taxes due on the portion of property which is no longer utilized as an art
park; provided, however, that new text end the additional taxes deleted text begin are equal to deleted text end new text begin must not be greater than
new text end the difference between the taxes determinednew text begin on that portion of the property utilized as an
art park new text end under sections 39 and 40 and the amount determined under subdivision 1 for all
years that the property qualified under section 38. deleted text begin The additional taxes must be extended
against the property on the tax list for the current year; provided, however, that deleted text end No interest
or penalties may be levied on the additional deleted text begin taxes if timely paid deleted text end new text begin amount provided that it is
paid within 30 days of the county's noticenew text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective March 1, 2005.
new text end
Sec. 47.
Laws 2001, First Special Session chapter 5, article 3, section 8, the effective
date, is amended to read:
new text begin EFFECTIVE DATE. new text end
This section is effective for taxes levied in 2002, payable in
2003, through taxes levied in deleted text begin 2007 deleted text end new text begin 2009new text end , payable in deleted text begin 2008 deleted text end new text begin 2010new text end .
Sec. 48.
Laws 2005, chapter 43, section 1, the effective date, if enacted, is amended to
read:
new text begin EFFECTIVE DATE. new text end
This section is effective for taxes levied in deleted text begin 2005 deleted text end new text begin 2004new text end ,
payable in deleted text begin 2006 deleted text end new text begin 2005new text end , and thereafter.
new text begin
EFFECTIVE DATE.
new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 49. new text begin REPORT; PROPOSED STANDARDIZED ASSESSMENT AND
CLASSIFICATION STANDARDS.
new text end
new text begin
Recognizing the importance of uniform and professional property tax assessment
practices, the commissioner of revenue, in consultation with appropriate stakeholder
groups shall develop and issue a report to the chairs of the house and senate tax committees
by February 1, 2006. This report shall contain, but not be limited to, recommendations
and proposed requirements for achieving standardized assessment and classification of
seasonal residential recreational property, residential nonhomestead property, timber and
woodland property, green acres property, seasonal residential recreational commercial and
noncommercial property, and commercial/industrial property.
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. 50. new text begin CODE OF CONDUCT AND ETHICS; ASSESSORS.
new text end
new text begin
The commissioner of revenue is directed to develop a code of conduct and ethics
for Minnesota assessors to ensure public confidence in property assessment. The
commissioner shall consult with representatives of the Minnesota Association of Assessing
Officers, the State Board of Assessors, and any other groups that the commissioner deems
appropriate. The code must include language that promotes fairness and uniformity and
recommends assessment practices that do not promote the perception of a conflict of
interest. The code must be completed and recommended to the Minnesota State Board of
Assessors for adopting by January 1, 2006. This code must be presented as part of the
course required by Minnesota Statutes, section 273.0755, paragraph (c).
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. 51. new text begin SCHOOL DEBT SERVICE LEVIES; ALTERNATIVE TAX BASE;
PILOT PROJECT.
new text end
new text begin Subdivision 1. new text end
new text begin Commissioner designation. new text end
new text begin
The commissioner of education may
select up to three school districts to participate in the pilot project under this section. The
commissioner must notify the selected school districts by July 1, 2005.
new text end
new text begin Subd. 2. new text end
new text begin Election by school board. new text end
new text begin
A school board designated by the commissioner
under subdivision 1 may by resolution elect to levy the debt service for a bond issued after
July 1, 2005, and before July 1, 2007, against the alternative net tax capacity of the district,
as defined under subdivision 6, rather than the net tax capacity of the district. A resolution
to levy against alternative net tax capacity must be passed at an open meeting of the board,
at least 60 days prior to the referendum election. A district electing to issue bonds with a
levy against alternative net tax capacity must notify the commissioner of that intention in
filing the proposal required by Minnesota Statutes, section 123B.71, subdivision 9.
new text end
new text begin Subd. 3. new text end
new text begin Debt service equalization revenue. new text end
new text begin
For the purposes of Minnesota
Statutes, section 123B.53, subdivision 4, debt service equalization revenue for a district
that has issued bonds under an election to levy against alternative net tax capacity is the
same as it would be if the levy were being made against net tax capacity.
new text end
new text begin Subd. 4. new text end
new text begin Apportionment of debt service aid. new text end
new text begin
Equalization aid for a district that
has issued bonds under an election to levy against alternative net tax capacity must be
apportioned between the net tax capacity debt service levy and the alternative net tax
capacity debt service levy in the same proportions as eligible debt service revenues
resulting from bonds issued against net tax capacity are to eligible debt service revenues
resulting from bonds issued against alternative net tax capacity.
new text end
new text begin Subd. 5. new text end
new text begin Alternative net tax capacity debt service levy. new text end
new text begin
The eligible debt service
revenues resulting from bonds issued against alternative net tax capacity, minus the debt
service equalization aid apportioned to the alternative net tax capacity levy, must be levied
against the alternative net tax capacity of the district as defined in subdivision 6, and must
be separately certified to the county auditor under Minnesota Statutes, section 275.07.
new text end
new text begin Subd. 6. new text end
new text begin Alternative net tax capacity. new text end
new text begin
"Alternative net tax capacity" means the
net tax capacity of all taxable property in a district, as defined in Minnesota Statutes,
section 273.13, except:
new text end
new text begin
(1) the first tier of class 2a property, excluding the portion of class 2a property
consisting of the house, garage, and surrounding one acre of land of an agricultural
homestead, has an alternative net tax capacity equal to 0.14 percent of its taxable market
value;
new text end
new text begin
(2) the upper tier of class 2a property and all other class 2 property has an alternative
net tax capacity equal to 0.25 percent of its taxable market value;
new text end
new text begin
(3) noncommercial class 4c(1) property has an alternative net tax capacity equal to
0.75 percent of its taxable market value;
new text end
new text begin
(4) class 4a and 4b property has an alternative net tax capacity equal to one percent
of its taxable market value;
new text end
new text begin
(5) the first tier of class 3 property has an alternative net tax capacity equal to 1.25
percent of its taxable market value; and
new text end
new text begin
(6) class 5 property and the upper tier of class 3 property has an alternative net tax
capacity equal to 1.5 percent of its taxable market value.
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. 52. new text begin SCHOOL PROPERTY; EXEMPTION 2005 ONLY.
new text end
new text begin
Notwithstanding Minnesota Statutes, section 272.02, subdivision 38, paragraph
(b), the following property is exempt from taxation for assessment year 2004, for taxes
payable in 2005, if it meets all the following criteria:
new text end
new text begin
(1) is used to provide direct educational instruction for grades 7 through 10;
new text end
new text begin
(2) is located in a city of the first class that has a population greater than 250,000 and
less than 350,000;
new text end
new text begin
(3) was purchased after July 1, 2004, by a nonprofit that is exempt from federal
income tax under section 501(c)(3) of the Internal Revenue Code; and
new text end
new text begin
(4) is leased and operated by two nonprofit corporations organized under Minnesota
Statutes, chapter 317A.
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. 53. new text begin REPEALER.
new text end
new text begin
Laws 1998, chapter 389, article 3, section 41, is repealed.
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
ARTICLE 3
PROPERTY TAX AIDS AND CREDITS
Section 1.
Minnesota Statutes 2004, section 4A.02, is amended to read:
4A.02 STATE DEMOGRAPHER.
(a) The director shall appoint a state demographer. The demographer must be
professionally competent in demography and must possess demonstrated ability based
upon past performance.
(b) The demographer shall:
(1) continuously gather and develop demographic data relevant to the state;
(2) design and test methods of research and data collection;
(3) periodically prepare population projections for the state and designated regions
and periodically prepare projections for each county or other political subdivision of the
state as necessary to carry out the purposes of this section;
(4) review, comment on, and prepare analysis of population estimates and
projections made by state agencies, political subdivisions, other states, federal agencies, or
nongovernmental persons, institutions, or commissions;
(5) serve as the state liaison with the United States Bureau of the Census, coordinate
state and federal demographic activities to the fullest extent possible, and aid the
legislature in preparing a census data plan and form for each decennial census;
(6) compile an annual study of population estimates on the basis of county, regional,
or other political or geographical subdivisions as necessary to carry out the purposes of
this section and section 4A.03;
(7) by January 1 of each year, issue a report to the legislature containing an analysis
of the demographic implications of the annual population study and population projections;
(8) prepare maps for all counties in the state, all municipalities with a population
of 10,000 or more, and other municipalities as needed for census purposes, according to
scale and detail recommended by the United States Bureau of the Census, with the maps
of cities showing precinct boundaries;
(9) prepare an estimate of population and of the number of households for each
governmental subdivision for which the Metropolitan Council does not prepare an annual
estimate, and convey the estimates to the governing body of each political subdivision by
deleted text begin May deleted text end new text begin June new text end 1 of each year;
(10) direct, under section 414.01, subdivision 14, and certify population and
household estimates of annexed or detached areas of municipalities or towns after being
notified of the order or letter of approval by the director;
(11) prepare, for any purpose for which a population estimate is required by law
or needed to implement a law, a population estimate of a municipality or town whose
population is affected by action under section 379.02 or 414.01, subdivision 14; and
(12) prepare an estimate of average household size for each statutory or home rule
charter city with a population of 2,500 or more by deleted text begin May deleted text end new text begin June new text end 1 of each year.
(c) A governing body may challenge an estimate made under paragraph (b) by
filing their specific objections in writing with the state demographer by June deleted text begin 10 deleted text end new text begin 24new text end . If
the challenge does not result in an acceptable estimate deleted text begin by June 24deleted text end , the governing body
may have a special census conducted by the United States Bureau of the Census. The
political subdivision must notify the state demographer by July 1 of its intent to have the
special census conducted. The political subdivision must bear all costs of the special
census. Results of the special census must be received by the state demographer by the
next April 15 to be used in that year's deleted text begin May deleted text end new text begin June new text end 1 estimate to the political subdivision
under paragraph (b).
new text begin
(d) The state demographer shall certify the estimates of population and household
size to the commissioner of revenue by July 15 each year, including any estimates still
under objection.
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. 2.
Minnesota Statutes 2004, section 273.1384, subdivision 1, is amended to read:
Subdivision 1.
Residential homestead market value credit.
Each county auditor
shall determine a homestead credit for each class 1a, 1b, 1c, and 2a homestead property
within the county equal to 0.4 percent of the new text begin first $76,000 of new text end market value of the propertydeleted text begin .
The amount of homestead credit for a homestead may not exceed $304 and is reduced by
deleted text end new text begin minusnew text end .09 percent of the market value in excess of $76,000. new text begin The credit amount may not be
less than zero.new text end In the case of an agricultural or resort homestead, only the market value of
the house, garage, and immediately surrounding one acre of land is eligible in determining
the property's homestead credit. In the case of a property which is classified as part
homestead and part nonhomestead, new text begin (i) new text end the credit shall apply only to the homestead portion
of the propertydeleted text begin .deleted text end new text begin , but (ii) if a portion of a property is classified as nonhomestead solely
because not all the owners occupy the property, or solely because both spouses do not
occupy the property, the credit amount shall be initially computed as if that nonhomestead
portion were also in the homestead class and then prorated to the owner-occupant's
percentage of ownership or prorated to one-half if both spouses do not occupy the property.
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. 3.
Minnesota Statutes 2004, section 276A.01, subdivision 7, is amended to read:
Subd. 7.
Population.
"Population" means the most recent estimate of the population
of a municipality made by the state demographer and filed with the commissioner of
revenue as of July deleted text begin 1 deleted text end new text begin 15 new text end of the year in which a municipality's distribution net tax capacity
is calculated. The state demographer shall annually estimate the population of each
municipality and, in the case of a municipality which is located partly within and partly
without the area, the proportion of the total which resides within the area, and shall file the
estimates with the commissioner of revenue.
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
[473.24] POPULATION ESTIMATES.
new text end
new text begin
(a) The Metropolitan Council shall annually prepare an estimate of population
for each county, city, and town in the metropolitan area and an estimate of the number
of households and average household size for each city in the metropolitan area with a
population of 2,500 or more, and an estimate of population over age 65 for each county in
the metropolitan area, and convey the estimates to the governing body of each county,
city, or town by June 1 each year. In the case of a city or town that is located partly within
and partly without the metropolitan area, the Metropolitan Council shall estimate the
proportion of the total population and the average size of households that reside within
the area. The Metropolitan Council may prepare an estimate of the population and of the
average household size for any other political subdivision located in the metropolitan area.
new text end
new text begin
(b) A governing body may challenge an estimate made under this section by
filing its specific objections in writing with the Metropolitan Council by June 24. If the
challenge does not result in an acceptable estimate, the governing body may have a special
census conducted by the United States Bureau of the Census. The political subdivision
must notify the Metropolitan Council on or before July 1 of its intent to have the special
census conducted. The political subdivision must bear all costs of the special census.
Results of the special census must be received by the Metropolitan Council by the next
April 15 to be used in that year's June 1 estimate under this section. The Metropolitan
Council shall certify the estimates of population and the average household size to the
state demographer and to the commissioner of revenue by July 15 each year, including any
estimates still under objection.
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. 5.
Minnesota Statutes 2004, section 473F.02, subdivision 7, is amended to read:
Subd. 7.
Population.
"Population" means the most recent estimate of the population
of a municipality made by the Metropolitan Council new text begin under section 473.24 new text end and filed
with the commissioner of revenue as of July deleted text begin 1 deleted text end new text begin 15 new text end of the year in which a municipality's
distribution net tax capacity is calculated. deleted text begin The council shall annually estimate the
population of each municipality as of a date which it determines and, in the case of a
municipality which is located partly within and partly without the area, the proportion
of the total which resides within the area, and shall promptly thereafter file its estimates
with the commissioner of revenue.
deleted 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. 6.
Minnesota Statutes 2004, section 477A.011, subdivision 3, is amended to read:
Subd. 3.
Population.
"Population" means the population new text begin estimated or new text end established
as of July deleted text begin 1 deleted text end new text begin 15 new text end in an aid calculation year by the most recent federal census, by a special
census conducted under contract with the United States Bureau of the Census, by a
population estimate made by the Metropolitan Council new text begin pursuant to section 473.24new text end , or by a
population estimate of the state demographer made pursuant to section 4A.02, whichever
is the most recent as to the stated date of the count or estimate for the preceding calendar
yearnew text begin , and which has been certified to the commissioner of revenue on or before July 15
of the aid calculation yearnew text end . The term "per capita" refers to population as defined by this
subdivision. new text begin A revision of an estimate or count is effective for these purposes only if it is
certified to the commissioner on or before July 15 of the aid calculation year. Clerical
errors in the certification or use of the estimates and counts established as of July 15 in
the aid calculation year are subject to correction within the time periods allowed under
section 477A.014.
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. 7.
Minnesota Statutes 2004, section 477A.011, subdivision 34, is amended to read:
Subd. 34.
City revenue need.
(a) For a city with a population equal to or greater
than 2,500, "city revenue need" is the sum of (1) 5.0734098 times the pre-1940 housing
percentage; plus (2) 19.141678 times the population decline percentage; plus (3)
2504.06334 times the road accidents factor; plus (4) 355.0547; minus (5) the metropolitan
area factor; minus (6) 49.10638 times the household size.
(b) For a city with a population less than 2,500, "city revenue need" is the sum of
(1) 2.387 times the pre-1940 housing percentage; plus (2) 2.67591 times the commercial
industrial percentage; plus (3) 3.16042 times the population decline percentage; plus (4)
1.206 times the transformed population; minus (5) 62.772.
(c) new text begin For a city with a population of 2,500 or more and a population in one of the most
recently available five years that was less than 2,500, "city revenue need" is the sum of (1)
its city revenue need calculated under paragraph (a) multiplied by its transition factor;
plus (2) its city revenue need calculated under the formula in paragraph (b) multiplied
by the difference between one and its transition factor. For purposes of this paragraph, a
city's "transition factor" is equal to 0.2 multiplied by the number of years that the city's
population estimate has been 2,500 or more. This provision only applies for aids payable
in calendar years 2006 to 2008 to cities with a 2002 population of less than 2,500. It
applies to any city for aids payable in 2009 and thereafter.
new text end
new text begin (d) new text end The city revenue need cannot be less than zero.
deleted text begin (d) deleted text end new text begin (e) new text end For calendar year 2005 and subsequent years, the city revenue need for a city,
as determined in paragraphs (a) to deleted text begin (c) deleted text end new text begin (d)new text end , is multiplied by the ratio of the annual 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 most recently available year to the 2003 implicit price deflator for state and local
government purchases.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective beginning with aids payable in 2006.
new text end
Sec. 8.
Minnesota Statutes 2004, section 477A.011, subdivision 35, is amended to read:
Subd. 35.
Tax effort rate.
"Tax effort rate" means the net levy for all cities divided
by the sum of the city net tax capacity for all citiesnew text begin , unless the need increase percentage
determined under section 477A.013, subdivision 8, is 100 percent, in which case the tax
effort rate is the rate needed so that the total aid under section 477A.013, subdivision 9,
equals the total amount available for aid under section 477A.03, after the subtractions in
section 477A.014new text end . For purposes of this section, "net levy" means the city levy, after all
adjustments, used for calculating the local tax rate under section 275.08 for taxes payable
in the year prior to the aid distribution. The fiscal disparity distribution levy under chapter
276A or 473F is included in net levy.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective beginning with aids payable in 2006.
new text end
Sec. 9.
Minnesota Statutes 2004, section 477A.011, subdivision 36, is amended to read:
Subd. 36.
City aid base.
(a) Except as otherwise provided in this subdivision,
"city aid base" is zero.
(b) The city aid base for any city with a population less than 500 is increased by
$40,000 for aids payable in calendar year 1995 and thereafter, and the maximum amount
of total aid it may receive under section 477A.013, subdivision 9, paragraph (c), is also
increased by $40,000 for aids payable in calendar year 1995 only, provided that:
(i) the average total tax capacity rate for taxes payable in 1995 exceeds 200 percent;
(ii) the city portion of the tax capacity rate exceeds 100 percent; and
(iii) its city aid base is less than $60 per capita.
(c) The city aid base for a city is increased by $20,000 in 1998 and thereafter and
the maximum amount of total aid it may receive under section 477A.013, subdivision 9,
paragraph (c), is also increased by $20,000 in calendar year 1998 only, provided that:
(i) the city has a population in 1994 of 2,500 or more;
(ii) the city is located in a county, outside of the metropolitan area, which contains a
city of the first class;
(iii) the city's net tax capacity used in calculating its 1996 aid under section
477A.013 is less than $400 per capita; and
(iv) at least four percent of the total net tax capacity, for taxes payable in 1996, of
property located in the city is classified as railroad property.
(d) The city aid base for a city is increased by $200,000 in 1999 and thereafter and
the maximum amount of total aid it may receive under section 477A.013, subdivision 9,
paragraph (c), is also increased by $200,000 in calendar year 1999 only, provided that:
(i) the city was incorporated as a statutory city after December 1, 1993;
(ii) its city aid base does not exceed $5,600; and
(iii) the city had a population in 1996 of 5,000 or more.
(e) The city aid base for a city is increased by $450,000 in 1999 to 2008 and the
maximum amount of total aid it may receive under section 477A.013, subdivision 9,
paragraph (c), is also increased by $450,000 in calendar year 1999 only, provided that:
(i) the city had a population in 1996 of at least 50,000;
(ii) its population had increased by at least 40 percent in the ten-year period ending
in 1996; and
(iii) its city's net tax capacity for aids payable in 1998 is less than $700 per capita.
(f) Beginning in 2004, the city aid base for a city is equal to the sum of its city aid
base in 2003 and the amount of additional aid it was certified to receive under section
477A.06 in 2003. For 2004 only, the maximum amount of total aid a city may receive
under section 477A.013, subdivision 9, paragraph (c), is also increased by the amount it
was certified to receive under section 477A.06 in 2003.
(g) The city aid base for a city is increased by $150,000 for aids payable in 2000 and
thereafter, and the maximum amount of total aid it may receive under section 477A.013,
subdivision 9, paragraph (c), is also increased by $150,000 in calendar year 2000 only,
provided that:
(1) the city has a population that is greater than 1,000 and less than 2,500;
(2) its commercial and industrial percentage for aids payable in 1999 is greater
than 45 percent; and
(3) the total market value of all commercial and industrial property in the city
for assessment year 1999 is at least 15 percent less than the total market value of all
commercial and industrial property in the city for assessment year 1998.
(h) The city aid base for a city is increased by $200,000 in 2000 and thereafter, and
the maximum amount of total aid it may receive under section 477A.013, subdivision 9,
paragraph (c), is also increased by $200,000 in calendar year 2000 only, provided that:
(1) the city had a population in 1997 of 2,500 or more;
(2) the net tax capacity of the city used in calculating its 1999 aid under section
477A.013 is less than $650 per capita;
(3) the pre-1940 housing percentage of the city used in calculating 1999 aid under
section 477A.013 is greater than 12 percent;
(4) the 1999 local government aid of the city under section 477A.013 is less than
20 percent of the amount that the formula aid of the city would have been if the need
increase percentage was 100 percent; and
(5) the city aid base of the city used in calculating aid under section 477A.013
is less than $7 per capita.
(i) The city aid base for a city is increased by $102,000 in 2000 and thereafter, and
the maximum amount of total aid it may receive under section 477A.013, subdivision 9,
paragraph (c), is also increased by $102,000 in calendar year 2000 only, provided that:
(1) the city has a population in 1997 of 2,000 or more;
(2) the net tax capacity of the city used in calculating its 1999 aid under section
477A.013 is less than $455 per capita;
(3) the net levy of the city used in calculating 1999 aid under section 477A.013 is
greater than $195 per capita; and
(4) the 1999 local government aid of the city under section 477A.013 is less than
38 percent of the amount that the formula aid of the city would have been if the need
increase percentage was 100 percent.
(j) The city aid base for a city is increased by $32,000 in 2001 and thereafter, and
the maximum amount of total aid it may receive under section 477A.013, subdivision 9,
paragraph (c), is also increased by $32,000 in calendar year 2001 only, provided that:
(1) the city has a population in 1998 that is greater than 200 but less than 500;
(2) the city's revenue need used in calculating aids payable in 2000 was greater
than $200 per capita;
(3) the city net tax capacity for the city used in calculating aids available in 2000
was equal to or less than $200 per capita;
(4) the city aid base of the city used in calculating aid under section 477A.013
is less than $65 per capita; and
(5) the city's formula aid for aids payable in 2000 was greater than zero.
(k) The city aid base for a city is increased by $7,200 in 2001 and thereafter, and
the maximum amount of total aid it may receive under section 477A.013, subdivision 9,
paragraph (c), is also increased by $7,200 in calendar year 2001 only, provided that:
(1) the city had a population in 1998 that is greater than 200 but less than 500;
(2) the city's commercial industrial percentage used in calculating aids payable in
2000 was less than ten percent;
(3) more than 25 percent of the city's population was 60 years old or older according
to the 1990 census;
(4) the city aid base of the city used in calculating aid under section 477A.013
is less than $15 per capita; and
(5) the city's formula aid for aids payable in 2000 was greater than zero.
(l) The city aid base for a city is increased by $45,000 in 2001 and thereafter and
by an additional $50,000 in calendar years 2002 to 2011, and the maximum amount of
total aid it may receive under section 477A.013, subdivision 9, paragraph (c), is also
increased by $45,000 in calendar year 2001 only, and by $50,000 in calendar year 2002
only, provided that:
(1) the net tax capacity of the city used in calculating its 2000 aid under section
477A.013 is less than $810 per capita;
(2) the population of the city declined more than two percent between 1988 and 1998;
(3) the net levy of the city used in calculating 2000 aid under section 477A.013 is
greater than $240 per capita; and
(4) the city received less than $36 per capita in aid under section 477A.013,
subdivision 9, for aids payable in 2000.
(m) The city aid base for a city with a population of 10,000 or more which is located
outside of the seven-county metropolitan area is increased in 2002 and thereafter, and the
maximum amount of total aid it may receive under section 477A.013, subdivision 9,
paragraph (b) or (c), is also increased in calendar year 2002 only, by an amount equal to
the lesser of:
(1)(i) the total population of the city, as determined by the United States Bureau of
the Census, in the 2000 census, (ii) minus 5,000, (iii) times 60; or
(2) $2,500,000.
(n) The city aid base is increased by $50,000 in 2002 and thereafter, and the
maximum amount of total aid it may receive under section 477A.013, subdivision 9,
paragraph (c), is also increased by $50,000 in calendar year 2002 only, provided that:
(1) the city is located in the seven-county metropolitan area;
(2) its population in 2000 is between 10,000 and 20,000; and
(3) its commercial industrial percentage, as calculated for city aid payable in 2001,
was greater than 25 percent.
(o) The city aid base for a city is increased by $150,000 in calendar years 2002
to 2011 and the maximum amount of total aid it may receive under section 477A.013,
subdivision 9, paragraph (c), is also increased by $150,000 in calendar year 2002 only,
provided that:
(1) the city had a population of at least 3,000 but no more than 4,000 in 1999;
(2) its home county is located within the seven-county metropolitan area;
(3) its pre-1940 housing percentage is less than 15 percent; and
(4) its city net tax capacity per capita for taxes payable in 2000 is less than $900
per capita.
(p) The city aid base for a city is increased by $200,000 beginning in calendar
year 2003 and the maximum amount of total aid it may receive under section 477A.013,
subdivision 9, paragraph (c), is also increased by $200,000 in calendar year 2003 only,
provided that the city qualified for an increase in homestead and agricultural credit aid
under Laws 1995, chapter 264, article 8, section 18.
(q) The city aid base for a city is increased by $200,000 in 2004 only and the
maximum amount of total aid it may receive under section 477A.013, subdivision 9, is
also increased by $200,000 in calendar year 2004 only, if the city is the site of a nuclear
dry cask storage facility.
(r) The city aid base for a city is increased by $10,000 in 2004 and thereafter and the
maximum total aid it may receive under section 477A.013, subdivision 9, is also increased
by $10,000 in calendar year 2004 only, if the city was included in a federal major disaster
designation issued on April 1, 1998, and its pre-1940 housing stock was decreased by
more than 40 percent between 1990 and 2000.
new text begin
(s) The city aid base for a city is increased by $25,000 in 2006 and thereafter and the
maximum total aid it may receive under section 477A.013, subdivision 9, is also increased
by $25,000 in calendar year 2006 only if the city had a population in 2003 of at least 1,000
and has a state park for which the city provides rescue services and which comprised at
least 14 percent of the total geographic area included within the city boundaries in 2000.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for aids payable in 2006 and
thereafter.
new text end
Sec. 10.
Minnesota Statutes 2004, section 477A.011, subdivision 38, is amended to
read:
Subd. 38.
Household size.
"Household size" means the average number of persons
per household in the jurisdiction as most recently estimated and reported by the state
demographer new text begin and Metropolitan Council new text end as of July deleted text begin 1 deleted text end new text begin 15 new text end of the aid calculation year. new text begin A
revision to an estimate or enumeration is effective for these purposes only if it is certified
to the commissioner on or before July 15 of the aid calculation year. Clerical errors in the
certification or use of estimates and counts established as of July 15 in the aid calculation
year are subject to correction within the time periods allowed under section 477A.014.
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. 11.
Minnesota Statutes 2004, section 477A.0124, subdivision 2, is amended to
read:
Subd. 2.
Definitions.
(a) For the purposes of this section, the following terms
have the meanings given them.
(b) "County program aid" means the sum of "county need aid," "county tax base
equalization aid," and "county transition aid."
(c) "Age-adjusted population" means a county's population multiplied by the county
age index.
(d) "County age index" means the percentage of the population over age 65 within
the county divided by the percentage of the population over age 65 within the state, except
that the age index for any county may not be greater than 1.8 nor less than 0.8.
(e) "Population over age 65" means the population over age 65 established as of
July deleted text begin 1 deleted text end new text begin 15 new text end in an aid calculation year by the most recent federal census, by a special census
conducted under contract with the United States Bureau of the Census, by a population
estimate made by the Metropolitan Council, or by a population estimate of the state
demographer made pursuant to section 4A.02, whichever is the most recent as to the stated
date of the count or estimate for the preceding calendar year new text begin and which has been certified
to the commissioner of revenue on or before July 15 of the aid calculation yearnew text end . new text begin A revision
to an estimate or count is effective for these purposes only if certified to the commissioner
on or before July 15 of the aid calculation year. Clerical errors in the certification or use of
estimates and counts established as of July 15 in the aid calculation year are subject to
correction within the time periods allowed under section 477A.014.
new text end
(f) "Part I crimes" means the three-year average annual number of Part I crimes
reported for each county by the Department of Public Safety for the most recent years
available. By July 1 of each year, the commissioner of public safety shall certify to the
commissioner of revenue the number of Part I crimes reported for each county for the
three most recent calendar years available.
(g) "Households receiving food stamps" means the average monthly number of
households receiving food stamps for the three most recent years for which data is
available. By July 1 of each year, the commissioner of human services must certify to the
commissioner of revenue the average monthly number of households in the state and in
each county that receive food stamps, for the three most recent calendar years available.
(h) "County net tax capacity" means the net tax capacity of the county, computed
analogously to city net tax capacity under section 477A.011, subdivision 20.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 12.
Minnesota Statutes 2004, section 477A.0124, subdivision 4, is amended to
read:
Subd. 4.
County tax-base equalization aid.
(a) Fordeleted text begin 2005 deleted text end new text begin 2006 new text end and subsequent
years, the money appropriated to county tax-base equalization aid each calendar yearnew text begin , after
the payment under paragraph (f),new text end shall be apportioned among the counties according to
each county's tax-base equalization aid factor.
(b) A county's tax-base equalization aid factor is equal to the amount by which (i)
$185 times the county's population, exceeds (ii) 9.45 percent of the county's net tax
capacity.
(c) In the case of a county with a population less than 10,000, the factor determined
in paragraph (b) shall be multiplied by a factor of three.
(d) In the case of a county with a population greater than or equal to 10,000, but less
than 12,500, the factor determined in paragraph (b) shall be multiplied by a factor of two.
(e) In the case of a county with a population greater than 500,000, the factor
determined in paragraph (b) shall be multiplied by a factor of 0.25.
new text begin
(f) Before the money appropriated to county base equalization aid is apportioned
among the counties as provided in paragraph (a), an amount up to $73,259 is allocated
annually to Anoka County and up to $59,664 is annually allocated to Washington County
for the county to pay postretirement costs of health insurance premiums for court
employees. The allocation under this paragraph is in addition to the allocations under
paragraphs (a) to (e).
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for aids payable in 2006 and
thereafter.
new text end
Sec. 13.
Minnesota Statutes 2004, section 477A.013, subdivision 8, is amended to read:
Subd. 8.
City formula aid.
In calendar year 2004 and subsequent years, the formula
aid for a city is equal to the need increase percentage multiplied by the difference between
(1) the city's revenue need multiplied by its population, and (2) the sum of the city's net
tax capacity multiplied by the tax effort ratedeleted text begin , and deleted text end new text begin ;new text end the taconite aids under sections 298.28
and 298.282, multiplied by the following percentages:
(i) zero percent for aids payable in 2004;
(ii) 25 percent for aids payable in 2005;
(iii) 50 percent for aids payable in 2006;
(iv) 75 percent for aids payable in 2007; and
(v) 100 percent for aids payable in 2008 and thereafternew text begin ; and
new text end
new text begin for first class cities only, the amount raised by a one-half of one percent local sales and
use tax imposed in the city in the calendar year before the year in which the aid is being
calculatednew text end .
No city may have a formula aid amount less than zero. The need increase percentage
must be the same for all cities.
The applicable need increase percentage must be calculated by the Department of
Revenue so that the total of the aid under subdivision 9 equals the total amount available
for aid under section 477A.03 after the subtraction under section 477A.014, subdivisions 4
and 5. new text begin The need increase percentage may not exceed 100 percent.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective beginning with aids payable in 2006.
new text end
Sec. 14.
Minnesota Statutes 2004, section 477A.013, subdivision 9, is amended to read:
Subd. 9.
City aid distribution.
(a) In calendar year 2002 and thereafter, each
city shall receive an aid distribution equal to the sum of (1) the city formula aid under
subdivision 8, and (2) its city aid base.
(b) deleted text begin The aid for a city in calendar year 2004 shall not exceed the amount of its aid in
calendar year 2003 after the reductions under Laws 2003, First Special Session chapter 21,
article 5.
deleted text end
deleted text begin (c) deleted text end For aids payable in 2005 and thereafter, the total aid for any city shall not exceed
the sum of (1) ten percent of the city's net levy for the year prior to the aid distribution
plus (2) its total aid in the previous year. For aids payable indeleted text begin 2005 deleted text end new text begin 2006 new text end and thereafter,
the total aid for any city with a population of 2,500 or morenew text begin , except for a city of the first
class located within the seven-county metropolitan area,new text end may not decrease from its total aid
under this section in the previous year by an amount greater than ten percent of its net
levy in the year prior to the aid distribution.
deleted text begin (d) deleted text end new text begin (c) new text end deleted text begin For aids payable in 2004 only, the total aid for a city with a population less
than 2,500 may not be less than the amount it was certified to receive in 2003 minus the
greater of (1) the reduction to this aid payment in 2003 under Laws 2003, First Special
Session chapter 21, article 5, or (2) five percent of its 2003 aid amount.deleted text end For aids payable in
2005 and thereafter, the total aid for a city with a population less than 2,500 must not be
less than the amount it was certified to receive in the previous year minus five percent
of its 2003 certified aid amount.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective beginning with aids payable in 2006.
new text end
Sec. 15.
Minnesota Statutes 2004, section 477A.013, is amended by adding a
subdivision to read:
new text begin Subd. 10. new text end
new text begin Levy adjustments for aid decreases. new text end
new text begin
Notwithstanding any local
ordinance or charter provision, a city whose certified aid under subdivision 9 is less than
the amount it received in the previous year under the same subdivision may increase its
levy payable in the same year as the certified aid is paid by an amount equal to the aid
decrease for that year.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective beginning with property tax levies
payable in 2006 and thereafter.
new text end
Sec. 16.
Minnesota Statutes 2004, section 477A.03, subdivision 2a, is amended to read:
Subd. 2a.
Cities.
For aids payable in 2004, the total aids paid under section
477A.013, subdivision 9, are limited to $429,000,000. For aids payable in 2005 deleted text begin and
thereafterdeleted text end , the total aids paid under section 477A.013, subdivision 9, are deleted text begin increased deleted text end new text begin limited
new text end to $437,052,000. new text begin For aids payable in 2006, the total aids paid under section 477A.013,
subdivision 9, is limited to $419,552,000. For aids payable in 2007 and thereafter, the total
aids paid under section 477A.013, subdivision 9, is limited to $437,052,000 provided that
the taxpayer satisfaction survey in section 275.065 is in effect for property taxes levied in
the year in which the aid is calculated, otherwise the amount is limited to $419,552,000.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective beginning with aids payable in 2006.
new text end
Sec. 17.
Minnesota Statutes 2004, section 477A.03, subdivision 2b, is amended to read:
Subd. 2b.
Counties.
(a) For aids payable in calendar year 2005 and thereafter,
the total aids paid to counties under section 477A.0124, subdivision 3, are limited to
$100,500,000. Each calendar year, $500,000 shall be retained by the commissioner of
revenue to make reimbursements to the commissioner of finance for payments made
under section 611.27. For calendar year 2004, the amount shall be in addition to the
payments authorized under section 477A.0124, subdivision 1. For calendar year 2005
and subsequent years, the amount shall be deducted from the appropriation under
this paragraph. The reimbursements shall be to defray the additional costs associated
with court-ordered counsel under section 611.27. Any retained amounts not used for
reimbursement in a year shall be included in the next distribution of county need aid
that is certified to the county auditors for the purpose of property tax reduction for the
next taxes payable year.
(b) For aids payable in 2005 and deleted text begin thereafter deleted text end new text begin 2006new text end , the total aids under section
477A.0124, subdivision 4, are limited to $105,000,000. new text begin For aids payable in 2007
and thereafter, the total aid under section 477A.0124, subdivision 4, is limited to
$105,132,923.new text end The commissioner of finance shall bill the commissioner of revenue
for the cost of preparation of local impact notes as required by section 3.987, not to
exceed $207,000 in fiscal year 2004 and thereafter. The commissioner of education shall
bill the commissioner of revenue for the cost of preparation of local impact notes for
school districts as required by section 3.987, not to exceed $7,000 in fiscal year 2004
and thereafter. The commissioner of revenue shall deduct the amounts billed under
this paragraph from the appropriation under this paragraph. The amounts deducted are
appropriated to the commissioner of finance and the commissioner of education for the
preparation of local impact notes.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for aids payable in 2007 and
thereafter.
new text end
Sec. 18.
Laws 2003, First Special Session chapter 21, article 5, section 13, is amended
to read:
Sec. 13new text begin 2004 CITY AID REDUCTIONS.
new text end
The commissioner of revenue shall compute an aid reduction amount for 2004
for each city as provided in this section.
The initial aid reduction amount for each city is the amount by which the city's aid
distribution under Minnesota Statutes, section 477A.013, and related provisions payable
in 2003 exceeds the city's 2004 distribution under those provisions.
The minimum aid reduction amount for a city is the amount of its reduction in
2003 under section 12. If a city receives an increase to its city aid base under Minnesota
Statutes, section 477A.011, subdivision 36, its minimum aid reduction is reduced by an
equal amount.
The maximum aid reduction amount for a city is an amount equal to 14 percent of
the city's total 2004 levy plus aid revenue base, except that if the city has a city net tax
capacity for aids payable in 2004, as defined in Minnesota Statutes, section 477A.011,
subdivision 20, of $700 per capita or less, the maximum aid reduction shall not exceed an
amount equal to 13 percent of the city's total 2004 levy plus aid revenue base.
If the initial aid reduction amount for a city is less than the minimum aid reduction
amount for that city, the final aid reduction amount for the city is the sum of the initial aid
reduction amount and the lesser of the amount of the city's payable 2004 reimbursement
under Minnesota Statutes, section 273.1384, or the difference between the minimum and
initial aid reduction amounts for the citynew text begin , and the amount of the final aid reduction in
excess of the initial aid reduction is deducted from the city's reimbursements pursuant
to Minnesota Statutes, section 273.1384new text end .
If the initial aid reduction amount for a city is greater than the maximum aid
reduction amount for the city, the city receives an additional distribution under this section
equal to the result of subtracting the maximum aid reduction amount from the initial aid
reduction amount. This distribution shall be paid in equal installments in 2004 on the
dates specified in Minnesota Statutes, section 477A.015. The amount necessary for these
additional distributions is appropriated to the commissioner of revenue from the general
fund in fiscal year 2005.
deleted text begin
The initial aid reduction is applied to the city's distribution pursuant to Minnesota
Statutes, section 477A.013, and any aid reduction in excess of the initial aid reduction is
applied to the city's reimbursements pursuant to Minnesota Statutes, section 273.1384.
deleted text end
To the extent that sufficient information is available on each payment date in 2004,
the commissioner of revenue shall pay the reimbursements reduced under this section in
equal installments on the payment dates provided in law.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for aids payable in 2004.
new text end
Sec. 19.
Laws 2003, First Special Session chapter 21, article 6, section 9, is amended
to read:
Sec. 9new text begin DEFINITIONS.
new text end
(a) For purposes of sections 9 to 15, the following terms have the meanings given
them in this section.
(b) The 2003 and 2004 "levy plus aid revenue base" for a county is the sum of that
county's certified property tax levy for taxes payable in 2003, plus the sum of the amounts
the county was certified to receive in the designated calendar year as:
(1) homestead and agricultural credit aid under Minnesota Statutes, section
273.1398, subdivision 2, plus any additional aid under section 16, minus the amount
calculated under section 273.1398, subdivision 4a, paragraph (b), for counties in judicial
districts one, three, six, and ten, and 25 percent of the amount calculated under section
273.1398, subdivision 4a, paragraph (b), for counties in judicial districts two and four;
(2) the amount of county manufactured home homestead and agricultural credit aid
computed for the county for payment in 2003 under section 273.166;
(3) criminal justice aid under Minnesota Statutes, section 477A.0121;
(4) family preservation aid under Minnesota Statutes, section 477A.0122;
(5) taconite aids under Minnesota Statutes, sections 298.28 and 298.282, including
any aid which was required to be placed in a special fund for expenditure in the next
succeeding year; and
(6) county program aid under section 477A.0124new text begin , exclusive of the attached
machinery aid componentnew text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for aids payable in 2004.
new text end
Sec. 20. new text begin 2005 AND 2006 CITY AID PAYMENTS.
new text end
new text begin
In 2005 and 2006, market value credit reimbursements for each city payable under
Minnesota Statutes, section 273.1384, are reduced by the dollar amount of the 2003
reduction in market value credit reimbursements for that city due to Laws 2003, First
Special Session chapter 21, article 5, section 12. No city's 2005 or 2006 market value
credit reimbursements are reduced to less than zero under this section. To the extent
sufficient information is available on each payment date, the commissioner shall pay the
annual 2005 and 2006 market value credit reimbursement amounts, after reduction under
this section, to cities in equal installments on the dates specified in Minnesota Statutes,
section 273.1384.
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. 21. new text begin COURT AID ADJUSTMENT.
new text end
new text begin
For aids payable in 2005 only, the amount of court aid paid to Anoka County under
Minnesota Statutes, section 273.1398, subdivision 4a, is increased by $36,630 for aids
payable in 2005 only and the amount paid to Washington County under Minnesota Statutes,
section 273.1398, subdivision 4a, is increased by $29,832 for aids payable in 2005 only.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for aids payable in 2005 only.
new text end
Sec. 22. new text begin SUPREME COURT BUDGET.
new text end
new text begin
The district courts general fund appropriation is reduced by $66,462 in fiscal year
2006 and $132,923 beginning in fiscal year 2007 to fund the amount transferred to
county tax base equalization aid to fund the payments under Minnesota Statutes, section
477A.0124, subdivision 4, paragraph (f), and section 20.
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
ARTICLE 4
DEPARTMENT OF REVENUE PROPERTY TAXES
Section 1.
Minnesota Statutes 2004, section 168A.05, subdivision 1a, is amended to
read:
Subd. 1a.
Manufactured home; statement of property tax payment.
In the case
of a manufactured home as defined in section 327.31, subdivision 6, the department shall
not issue a certificate of title unless the application under section 168A.04 is accompanied
with a statement from the county auditor or county treasurer where the manufactured
home is presently located, stating that all manufactured home personal property taxes
levied on the unit in the name of the current owner at the time of transfer have been
paid. new text begin For this purpose, manufactured home personal property taxes are treated as levied
on January 1 of the payable year.
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. 2.
Minnesota Statutes 2004, section 270.11, subdivision 2, is amended to read:
Subd. 2.
County assessor's reports of assessment filed with commissioner.
Each
county assessor shall file by April 1 with the commissioner of revenue a copy of the
abstract that will be acted upon by the local and county boards of review. The abstract
must list the real and personal property in the county itemized by assessment districts.
The assessor of each county in the state shall file with the commissioner, within ten
working days following final action of the local board of review or equalization and within
five days following final action of the county board of equalization, any changes made
by the local or county board. The information must be filed in the manner prescribed
by the commissioner. It must be accompanied by a printed or typewritten copy of the
proceedings of the appropriate board.
The final abstract of assessments after adjustments by the State Board of
Equalization and inclusion of any omitted property shall be submitted to the commissioner
of revenue on or before September 1 of each calendar year. The final abstract must
separately report the captured tax capacity of tax increment financing districts under
section 469.177, subdivision 2, the deleted text begin metropolitan revenue deleted text end new text begin areawide net tax capacity
new text end contribution deleted text begin value deleted text end new text begin values determined new text end under deleted text begin section deleted text end new text begin sections 276A.05, subdivision 1, and
new text end 473F.07, new text begin subdivision 1,new text end and the value subject to the power line credit under section 273.42.
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.
Minnesota Statutes 2004, section 270.16, subdivision 2, is amended to read:
Subd. 2.
Failure to appraise.
When an assessor has failed to properly appraise at
least deleted text begin one-quarter deleted text end new text begin one-fifth new text end of the parcels of property in a district or county as provided
in section 273.01, the commissioner of revenue shall appoint a special assessor and
deputy assessor as necessary and cause a reappraisal to be made of the property due
for reassessment in accordance with law.
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.
Minnesota Statutes 2004, section 272.01, subdivision 2, is amended to read:
Subd. 2.
Effective date.
new text begin
This section is effective the day following final enactment.
new text end
Sec. 5. Minnesota Statutes 2004, section 272.02, subdivision 1a, is amended
to read:
Subd. 1a.
Limitations on exemptions.
The exemptions granted by subdivision 1
are subject to the limits contained in the other subdivisions of this section, section 272.025,
deleted text begin or 273.13, subdivision 25, paragraph (c), clause (1) or (2), or paragraph (d), clause (2)
deleted text end new text begin and all other provisions of applicable lawnew 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. 6. Minnesota Statutes 2004, section 272.02, subdivision 7, is amended to read:
Subd. 7.
Institutions of public charity.
Institutions of purely public charity are
exempt deleted text begin except parcels of property containing structures and the structures described in
section 273.13, subdivision 25, paragraph (e), other than those that qualify for exemption
under subdivision 26deleted text end . new text begin In determining whether rental housing property qualifies for
exemption under this subdivision, the following are not gifts or donations to the owner of
the rental housing:
new text end
new text begin
(1) rent assistance provided by the government to or on behalf of tenants; and
new text end
new text begin
(2) financing assistance or tax credits provided by the government to the owner on
condition that specific units or a specific quantity of units be set aside for persons or
families with certain income characteristics.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes payable in 2004 and
thereafter.
new text end
Sec. 7. Minnesota Statutes 2004, section 272.02, is amended by adding a
subdivision to read:
new text begin Subd. 68. new text end
new text begin Property subject to taconite production tax or net proceeds tax. new text end
new text begin
(a)
Real and personal property described in section 298.25 is exempt to the extent the tax on
taconite and iron sulphides under section 298.24 is described in section 298.25 as being in
lieu of other taxes on such property. This exemption applies for taxes payable in each year
that the tax under section 298.24 is payable with respect to such property.
new text end
new text begin
(b) Deposits of mineral, metal, or energy resources the mining of which is subject to
taxation under section 298.015 are exempt. This exemption applies for taxes payable in
each year that the tax under section 298.015 is payable with respect to such property.
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. 8. Minnesota Statutes 2004, section 272.02, is amended by adding a
subdivision to read:
new text begin Subd. 69. new text end
new text begin Religious corporations. new text end
new text begin
Personal and real property that a religious
corporation, formed under section 317A.909, necessarily uses for a religious purpose is
exempt to the extent provided in section 317A.909, subdivision 3.
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. 9. Minnesota Statutes 2004, section 272.02, is amended by adding a
subdivision to read:
new text begin Subd. 70.new text end [CHILDREN'S HOMES.] new text begin Personal and real property owned by a
corporation formed under section 317A.907 is exempt to the extent provided in section
317A.907, subdivision 7.
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. 10. Minnesota Statutes 2004, section 272.02, is amended by adding a
subdivision to read:
new text begin Subd. 71. new text end
new text begin
Housing and redevelopment authority and tribal housing authority
property.
new text end
new text begin
Property owned by a housing and redevelopment authority described in chapter
469, or by a designated housing authority described in section 469.040, subdivision 5, is
exempt to the extent provided in chapter 469.
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. 11.
Minnesota Statutes 2004, section 272.02, is amended by adding a subdivision
to read:
new text begin Subd. 72. new text end
new text begin Property of housing and redevelopment authorities. new text end
new text begin
Property of
projects of housing and redevelopment authorities are exempt to the extent permitted by
sections 469.042, subdivision 1, and 469.043, subdivisions 2 and 5.
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. 12.
Minnesota Statutes 2004, section 272.02, is amended by adding a subdivision
to read:
new text begin Subd. 73. new text end
new text begin Property of regional rail authority. new text end
new text begin
Property of a regional rail authority
as defined in chapter 398A is exempt to the extent permitted by section 398A.05.
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. 13.
Minnesota Statutes 2004, section 272.02, is amended by adding a subdivision
to read:
new text begin Subd. 74. new text end
new text begin Spirit mountain recreation area authority. new text end
new text begin
Property owned by the
Spirit Mountain Recreation Area Authority is exempt from taxation to the extent provided
in Laws 1973, chapter 327, section 6.
new text end
Sec. 14.
Minnesota Statutes 2004, section 272.02, is amended by adding a subdivision
to read:
new text begin Subd. 75. new text end
new text begin Installed capacity defined. new text end
new text begin
For purposes of this section, the term
"installed capacity" means generator nameplate capacity.
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. 15.
Minnesota Statutes 2004, section 272.029, subdivision 4, is amended to read:
Subd. 4.
Reports.
(a) An owner of a wind energy conversion system subject to tax
under subdivision 3 shall file a report with the commissioner of revenue annually on
or beforedeleted text begin March deleted text end new text begin February new text end 1 detailing the amount of electricity in kilowatt-hours that
was produced by the wind energy conversion system for the previous calendar year.
The commissioner shall prescribe the form of the report. The report must contain the
information required by the commissioner to determine the tax due to each county under
this section for the current year. If an owner of a wind energy conversion system subject
to taxation under this section fails to file the report by the due date, the commissioner
of revenue shall determine the tax based upon the nameplate capacity of the system
multiplied by a capacity factor of 40 percent.
(b) On or before deleted text begin March 31 deleted text end new text begin February 28new text end , the commissioner of revenue shall notify
the owner of the wind energy conversion systems of the tax due to each county for the
current year and shall certify to the county auditor of each county in which the systems are
located the tax due from each owner for the current year.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for reports and certifications due in
2006 and thereafter.
new text end
Sec. 16.
Minnesota Statutes 2004, section 272.029, subdivision 6, is amended to read:
Subd. 6.
Distribution of revenues.
Revenues from the taxes imposed under
subdivision 5 must be part of the settlement between the county treasurer and the
county auditor under section 276.09. The revenue must be distributed by the county
auditor or the county treasurer to deleted text begin all deleted text end new text begin local new text end taxing jurisdictions in which the wind energy
conversion system is locateddeleted text begin ,deleted text end new text begin as follows: beginning with distributions in 2006, 80 percent
to counties; 14 percent to cities and townships; and six percent to school districts; and
for distributions occurring in 2004 and 2005 new text end in the same proportion that each of the new text begin local
new text end taxing jurisdiction's current year's net tax capacity based tax rate is to the current year's
total new text begin local new text end net tax capacity based rate.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 17.
Minnesota Statutes 2004, section 273.11, subdivision 8, is amended to read:
Subd. 8.
Limited equity cooperative apartments.
For the purposes of this
subdivision, the terms defined in this subdivision have the meanings given them.
A "limited equity cooperative" is a corporation organized under chapter 308A new text begin or
308Bnew text end , which has as its primary purpose the provision of housing and related services to
its members which meets one of the following criteria with respect to the income of its
members: (1) a minimum of 75 percent of members must have incomes at or less than
90 percent of area median income, (2) a minimum of 40 percent of members must have
incomes at or less than 60 percent of area median income, or (3) a minimum of 20 percent
of members must have incomes at or less than 50 percent of area median income. For
purposes of this clause, "member income" shall mean the income of a member existing at
the time the member acquires cooperative membership, and median income shall mean
the St. Paul-Minneapolis metropolitan area median income as determined by the United
States Department of Housing and Urban Development. It must also meet the following
requirements:
(a) The articles of incorporation set the sale price of occupancy entitling cooperative
shares or memberships at no more than a transfer value determined as provided in the
articles. That value may not exceed the sum of the following:
(1) the consideration paid for the membership or shares by the first occupant of the
unit, as shown in the records of the corporation;
(2) the fair market value, as shown in the records of the corporation, of any
improvements to the real property that were installed at the sole expense of the member
with the prior approval of the board of directors;
(3) accumulated interest, or an inflation allowance not to exceed the greater of a ten
percent annual noncompounded increase on the consideration paid for the membership or
share by the first occupant of the unit, or the amount that would have been paid on that
consideration if interest had been paid on it at the rate of the percentage increase in the
revised Consumer Price Index for All Urban Consumers for the Minneapolis-St. Paul
metropolitan area prepared by the United States Department of Labor, provided that the
amount determined pursuant to this clause may not exceed $500 for each year or fraction
of a year the membership or share was owned; plus
(4) real property capital contributions shown in the records of the corporation to
have been paid by the transferor member and previous holders of the same membership,
or of separate memberships that had entitled occupancy to the unit of the member
involved. These contributions include contributions to a corporate reserve account the
use of which is restricted to real property improvements or acquisitions, contributions to
the corporation which are used for real property improvements or acquisitions, and the
amount of principal amortized by the corporation on its indebtedness due to the financing
of real property acquisition or improvement or the averaging of principal paid by the
corporation over the term of its real property-related indebtedness.
(b) The articles of incorporation require that the board of directors limit the purchase
price of stock or membership interests for new member-occupants or resident shareholders
to an amount which does not exceed the transfer value for the membership or stock as
defined in clause (a).
(c) The articles of incorporation require that the total distribution out of capital to a
member shall not exceed that transfer value.
(d) The articles of incorporation require that upon liquidation of the corporation any
assets remaining after retirement of corporate debts and distribution to members will
be conveyed to a charitable organization described in section 501(c)(3) of the Internal
Revenue Code of 1986, as amended through December 31, 1992, or a public agency.
A "limited equity cooperative apartment" is a dwelling unit owned by a limited
equity cooperative.
"Occupancy entitling cooperative share or membership" is the ownership interest
in a cooperative organization which entitles the holder to an exclusive right to occupy a
dwelling unit owned or leased by the cooperative.
For purposes of taxation, the assessor shall value a unit owned by a limited equity
cooperative at the lesser of its market value or the value determined by capitalizing the net
operating income of a comparable apartment operated on a rental basis at the capitalization
rate used in valuing comparable buildings that are not limited equity cooperatives. If a
cooperative fails to operate in accordance with the provisions of clauses (a) to (d), the
property shall be subject to additional property taxes in the amount of the difference
between the taxes determined in accordance with this subdivision for the last ten years that
the property had been assessed pursuant to this subdivision and the amount that would
have been paid if the provisions of this subdivision had not applied to it. The additional
taxes, plus interest at the rate specified in section 549.09, shall be extended against the
property on the tax list for the current year.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes payable in 2004 and
thereafter.
new text end
Sec. 18.
Minnesota Statutes 2004, section 273.124, subdivision 3, is amended to read:
Subd. 3.
Cooperatives and charitable corporations; homestead and other
property.
(a) When property is owned by a corporation or association organized under
chapter 308A new text begin or 308Bnew text end , and each person who owns a share or shares in the corporation or
association is entitled to occupy a building on the property, or a unit within a building
on the property, the corporation or association may claim homestead treatment for each
dwelling, or for each unit in the case of a building containing several dwelling units, or for
the part of the value of the building occupied by a shareholder. Each building or unit must
be designated by legal description or number. The net tax capacity of each building or
unit that qualifies for assessment as a homestead under this subdivision must include not
more than one-half acre of land, if platted, nor more than 80 acres if unplatted. The net
tax capacity of the property is the sum of the net tax capacities of each of the respective
buildings or units comprising the property, including the net tax capacity of each unit's
or building's proportionate share of the land and any common buildings. To qualify for
the treatment provided by this subdivision, the corporation or association must be wholly
owned by persons having a right to occupy a building or unit owned by the corporation
or association. A charitable corporation organized under the laws of Minnesota and not
otherwise exempt thereunder with no outstanding stock qualifies for homestead treatment
with respect to member residents of the dwelling units who have purchased and hold
residential participation warrants entitling them to occupy the units.
(b) To the extent provided in paragraph (a), a cooperative or corporation organized
under chapter 308A may obtain separate assessment and valuation, and separate property
tax statements for each residential homestead, residential nonhomestead, or for each
seasonal residential recreational building or unit not used for commercial purposes. The
appropriate class rates under section 273.13 shall be applicable as if each building or unit
were a separate tax parcel; provided, however, that the tax parcel which exists at the time
the cooperative or corporation makes application under this subdivision shall be a single
parcel for purposes of property taxes or the enforcement and collection thereof, other than
as provided in paragraph (a) or this paragraph.
(c) A member of a corporation or association may initially obtain the separate
assessment and valuation and separate property tax statements, as provided in paragraph
(b), by applying to the assessor by June 30 of the assessment year.
(d) When a building, or dwelling units within a building, no longer qualify under
paragraph (a) or (b), the current owner must notify the assessor within 30 days. Failure to
notify the assessor within 30 days shall result in the loss of benefits under paragraph (a) or
(b) for taxes payable in the year that the failure is discovered. For these purposes, "benefits
under paragraph (a) or (b)" means the difference in the net tax capacity of the building or
units which no longer qualify as computed under paragraph (a) or (b) and as computed
under the otherwise applicable law, times the local tax rate applicable to the building for
that taxes payable year. Upon discovery of a failure to notify, the assessor shall inform the
auditor of the difference in net tax capacity for the building or buildings in which units no
longer qualify, and the auditor shall calculate the benefits under paragraph (a) or (b). Such
amount, plus a penalty equal to 100 percent of that amount, shall then be demanded of the
building's owner. The property owner may appeal the county's determination by serving
copies of a petition for review with county officials as provided in section 278.01 and
filing a proof of service as provided in section 278.01 with the Minnesota Tax Court within
60 days of the date of the notice from the county. The appeal shall be governed by the Tax
Court procedures provided in chapter 271, for cases relating to the tax laws as defined in
section 271.01, subdivision 5; disregarding sections 273.125, subdivision 5, and 278.03,
but including section 278.05, subdivision 2. If the amount of the benefits under paragraph
(a) or (b) and penalty are not paid within 60 days, and if no appeal has been filed, the
county auditor shall certify the amount of the benefit and penalty to the succeeding year's
tax list to be collected as part of the property taxes on the affected property.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes payable in 2004 and
thereafter.
new text end
Sec. 19.
Minnesota Statutes 2004, section 273.124, subdivision 6, is amended to read:
Subd. 6.
Leasehold cooperatives.
When one or more dwellings or one or more
buildings which each contain several dwelling units is owned by a nonprofit corporation
subject to the provisions of chapter 317A and qualifying under section 501(c)(3) or
501(c)(4) of the Internal Revenue Code of 1986, as amended through December 31,
1990, or a limited partnership which corporation or partnership operates the property in
conjunction with a cooperative association, and has received public financing, homestead
treatment may be claimed by the cooperative association on behalf of the members of
the cooperative for each dwelling unit occupied by a member of the cooperative. The
cooperative association must provide the assessor with the Social Security numbers of
those members. To qualify for the treatment provided by this subdivision, the following
conditions must be met:
(a) the cooperative association must be organized under chapter 308A new text begin or 308B new text end and
all voting members of the board of directors must be resident tenants of the cooperative
and must be elected by the resident tenants of the cooperative;
(b) the cooperative association must have a lease for occupancy of the property for a
term of at least 20 years, which permits the cooperative association, while not in default on
the lease, to participate materially in the management of the property, including material
participation in establishing budgets, setting rent levels, and hiring and supervising a
management agent;
(c) to the extent permitted under state or federal law, the cooperative association
must have a right under a written agreement with the owner to purchase the property if the
owner proposes to sell it; if the cooperative association does not purchase the property it is
offered for sale, the owner may not subsequently sell the property to another purchaser at
a price lower than the price at which it was offered for sale to the cooperative association
unless the cooperative association approves the sale;
(d) a minimum of 40 percent of the cooperative association's members must have
incomes at or less than 60 percent of area median gross income as determined by the
United States Secretary of Housing and Urban Development under section 142(d)(2)(B)
of the Internal Revenue Code of 1986, as amended through December 31, 1991. For
purposes of this clause, "member income" means the income of a member existing at the
time the member acquires cooperative membership;
(e) if a limited partnership owns the property, it must include as the managing
general partner a nonprofit organization operating under the provisions of chapter 317A
and qualifying under section 501(c)(3) or 501(c)(4) of the Internal Revenue Code of 1986,
as amended through December 31, 1990, and the limited partnership agreement must
provide that the managing general partner have sufficient powers so that it materially
participates in the management and control of the limited partnership;
(f) prior to becoming a member of a leasehold cooperative described in this
subdivision, a person must have received notice that (1) describes leasehold cooperative
property in plain language, including but not limited to the effects of classification
under this subdivision on rents, property taxes and tax credits or refunds, and operating
expenses, and (2) states that copies of the articles of incorporation and bylaws of the
cooperative association, the lease between the owner and the cooperative association, a
sample sublease between the cooperative association and a tenant, and, if the owner is a
partnership, a copy of the limited partnership agreement, can be obtained upon written
request at no charge from the owner, and the owner must send or deliver the materials
within seven days after receiving any request;
(g) if a dwelling unit of a building was occupied on the 60th day prior to the date on
which the unit became leasehold cooperative property described in this subdivision, the
notice described in paragraph (f) must have been sent by first class mail to the occupant of
the unit at least 60 days prior to the date on which the unit became leasehold cooperative
property. For purposes of the notice under this paragraph, the copies of the documents
referred to in paragraph (f) may be in proposed version, provided that any subsequent
material alteration of those documents made after the occupant has requested a copy
shall be disclosed to any occupant who has requested a copy of the document. Copies of
the articles of incorporation and certificate of limited partnership shall be filed with the
secretary of state after the expiration of the 60-day period unless the change to leasehold
cooperative status does not proceed;
(h) the county attorney of the county in which the property is located must certify to
the assessor that the property meets the requirements of this subdivision;
(i) the public financing received must be from at least one of the following sources:
(1) tax increment financing proceeds used for the acquisition or rehabilitation of the
building or interest rate write-downs relating to the acquisition of the building;
(2) government issued bonds exempt from taxes under section 103 of the Internal
Revenue Code of 1986, as amended through December 31, 1991, the proceeds of which
are used for the acquisition or rehabilitation of the building;
(3) programs under section 221(d)(3), 202, or 236, of Title II of the National
Housing Act;
(4) rental housing program funds under Section 8 of the United States Housing
Act of 1937 or the market rate family graduated payment mortgage program funds
administered by the Minnesota Housing Finance Agency that are used for the acquisition
or rehabilitation of the building;
(5) low-income housing credit under section 42 of the Internal Revenue Code of
1986, as amended through December 31, 1991;
(6) public financing provided by a local government used for the acquisition or
rehabilitation of the building, including grants or loans from (i) federal community
development block grants; (ii) HOME block grants; or (iii) residential rental bonds issued
under chapter 474A; or
(7) other rental housing program funds provided by the Minnesota Housing Finance
Agency for the acquisition or rehabilitation of the building;
(j) at the time of the initial request for homestead classification or of any transfer of
ownership of the property, the governing body of the municipality in which the property is
located must hold a public hearing and make the following findings:
(1) that the granting of the homestead treatment of the apartment's units will
facilitate safe, clean, affordable housing for the cooperative members that would otherwise
not be available absent the homestead designation;
(2) that the owner has presented information satisfactory to the governing body
showing that the savings garnered from the homestead designation of the units will be
used to reduce tenant's rents or provide a level of furnishing or maintenance not possible
absent the designation; and
(3) that the requirements of paragraphs (b), (d), and (i) have been met.
Homestead treatment must be afforded to units occupied by members of the
cooperative association and the units must be assessed as provided in subdivision 3,
provided that any unit not so occupied shall be classified and assessed pursuant to the
appropriate class. No more than three acres of land may, for assessment purposes,
be included with each dwelling unit that qualifies for homestead treatment under this
subdivision.
When dwelling units no longer qualify under this subdivision, the current owner
must notify the assessor within 60 days. Failure to notify the assessor within 60 days shall
result in the loss of benefits under this subdivision for taxes payable in the year that the
failure is discovered. For these purposes, "benefits under this subdivision" means the
difference in the net tax capacity of the units which no longer qualify as computed under
this subdivision and as computed under the otherwise applicable law, times the local tax
rate applicable to the building for that taxes payable year. Upon discovery of a failure to
notify, the assessor shall inform the auditor of the difference in net tax capacity for the
building or buildings in which units no longer qualify, and the auditor shall calculate the
benefits under this subdivision. Such amount, plus a penalty equal to 100 percent of that
amount, shall then be demanded of the building's owner. The property owner may appeal
the county's determination by serving copies of a petition for review with county officials
as provided in section 278.01 and filing a proof of service as provided in section 278.01
with the Minnesota Tax Court within 60 days of the date of the notice from the county.
The appeal shall be governed by the Tax Court procedures provided in chapter 271, for
cases relating to the tax laws as defined in section 271.01, subdivision 5; disregarding
sections 273.125, subdivision 5, and 278.03, but including section 278.05, subdivision 2.
If the amount of the benefits under this subdivision and penalty are not paid within 60
days, and if no appeal has been filed, the county auditor shall certify the amount of the
benefit and penalty to the succeeding year's tax list to be collected as part of the property
taxes on the affected buildings.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes payable in 2004 and
thereafter.
new text end
Sec. 20.
Minnesota Statutes 2004, section 273.124, subdivision 8, is amended to read:
Subd. 8.
Homestead owned by or leased to family farm corporation, joint farm
venture, limited liability company, or partnership.
(a) Each family farm corporationdeleted text begin ,
each deleted text end new text begin ; each new text end joint family farm venturedeleted text begin ,deleted text end new text begin ; and new text end each limited liability companydeleted text begin , and each deleted text end new text begin or
new text end partnership deleted text begin operating deleted text end new text begin which operates new text end a family farmnew text begin ;new text end is entitled to class 1b under section
273.13, subdivision 22, paragraph (b), or class 2a assessment for one homestead occupied
by a shareholder, member, or partner thereof who is residing on the land, and actively
engaged in farming of the land owned by the family farm corporation, joint family farm
venture, limited liability company, or partnership deleted text begin operating a family farmdeleted text end . Homestead
treatment applies even if legal title to the property is in the name of the family farm
corporation, joint family farm venture, limited liability company, or partnership deleted text begin operating
the family farmdeleted text end , and not in the name of the person residing on it.
"Family farm corporation," "family farm," and "partnership operating a family
farm" have the meanings given in section 500.24, except that the number of allowable
shareholders, members, or partners under this subdivision shall not exceed 12. "Limited
liability company" has the meaning contained in sections 322B.03, subdivision 28, and
500.24, subdivision 2, paragraphs (l) and (m). "Joint family farm venture" means a
cooperative agreement among two or more farm enterprises authorized to operate a family
farm under section 500.24.
(b) In addition to property specified in paragraph (a), any other residences owned
by family farm corporations, joint family farm ventures, limited liability companies, or
partnershipsdeleted text begin operating a family farm deleted text end described in paragraph (a) which are located on
agricultural land and occupied as homesteads by its shareholders, members, or partners
who are actively engaged in farming on behalf of that corporation, joint farm venture,
limited liability company, or partnership must also be assessed as class 2a property or
as class 1b property under section 273.13.
(c) Agricultural property that is owned by a member, partner, or shareholder of a
family farm corporation or joint family farm venture, limited liability company new text begin operating
a family farmnew text end , or by a partnership operating a family farm and leased to the family farm
corporation, limited liability company, deleted text begin or deleted text end partnership deleted text begin operating a family farmdeleted text end , or joint
farm venture, as defined in paragraph (a), is eligible for classification as class 1b or class
2a under section 273.13, if the owner is actually residing on the property, and is actually
engaged in farming the land on behalf of that corporation, joint farm venture, limited
liability company, or partnership. This paragraph applies without regard to any legal
possession rights of the family farm corporation, joint family farm venture, limited
liability company, or partnership deleted text begin operating a family farm deleted text end under the lease.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 21.
Minnesota Statutes 2004, section 273.124, subdivision 21, is amended to read:
Subd. 21.
Trust property; homestead.
Real property held by a trustee under a trust
is eligible for classification as homestead property if:
(1) the grantor or surviving spouse of the grantor of the trust occupies and uses the
property as a homestead;
(2) a relative or surviving relative of the grantor who meets the requirements of
subdivision 1, paragraph (c), in the case of residential real estate; or subdivision 1,
paragraph (d), in the case of agricultural property, occupies and uses the property as
a homestead;
(3) a family farm corporation, joint farm venture, limited liability company, or
partnership operating a family farm rents the property held by a trustee under a trust, and
new text begin the grantor, the spouse of the grantor, or the son or daughter of the grantor, who is also new text end a
shareholder, member, or partner of the corporation, joint farm venture, limited liability
company, or partnership occupies and uses the property as a homestead, deleted text begin and deleted text end new text begin or new text end is actively
farming the property on behalf of the corporation, joint farm venture, limited liability
company, or partnership; or
(4) a person who has received homestead classification for property taxes payable in
2000 on the basis of an unqualified legal right under the terms of the trust agreement to
occupy the property as that person's homestead and who continues to use the property as
a homestead new text begin or a person who received the homestead classification for taxes payable in
2005 under clause (3) who does not qualify under clause (3) for taxes payable in 2006
or thereafter but who continues to qualify under clause (3) as it existed for taxes payable
in 2005new text end .
For purposes of this subdivision, "grantor" is defined as the person creating or
establishing a testamentary, inter Vivos, revocable or irrevocable trust by written
instrument or through the exercise of a power of appointment.
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. 22.
Minnesota Statutes 2004, section 273.1315, is amended to read:
273.1315 CERTIFICATION OF 1B PROPERTY.
Any property owner seeking classification and assessment of the owner's homestead
as class 1b property pursuant to section 273.13, subdivision 22, paragraph (b), shall file
with the commissioner of revenue a 1b homestead declaration, on a form prescribed by the
commissioner. The declaration shall contain the following information:
(a) the information necessary to verify that new text begin on or before June 30 of the filing year,new text end the
property owner or the owner's spouse satisfies the requirements of section 273.13,
subdivision 22, paragraph (b), for 1b classification; and
(b) any additional information prescribed by the commissioner.
The declaration must be filed on or before October 1 to be effective for property
taxes payable during the succeeding calendar year. The declaration and any supplementary
information received from the property owner pursuant to this section shall be subject to
chapter 270B. If approved by the commissioner, the declaration remains in effect until the
property no longer qualifies under section 273.13, subdivision 22, paragraph (b). Failure
to notify the commissioner within 30 days that the property no longer qualifies under that
paragraph because of a sale, change in occupancy, or change in the status or condition
of an occupant shall result in the penalty provided in section 273.124, subdivision 13,
computed on the basis of the class 1b benefits for the property, and the property shall lose
its current class 1b classification.
The commissioner shall provide to the assessor on or before November 1 a listing
of the parcels of property qualifying for 1b classification.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 23.
Minnesota Statutes 2004, section 273.19, subdivision 1a, is amended to read:
Subd. 1a.
Effective date.
new text begin
This section is effective the day following final enactment.
new text end
Sec. 24. Minnesota Statutes 2004, section 273.372, is amended to read:
273.372 [PROCEEDINGS AND APPEALS; UTILITY OR RAILROAD
VALUATIONS.]
new text begin Subdivision 1. new text end
new text begin Scope. new text end
new text begin (a) As provided in this section,new text end an appeal by a utility or
railroad company concerning deleted text begin the exemption, valuation, or classification of deleted text end property
for which the commissioner of revenue has provided the city or county assessor with
valuations by order, or for which the commissioner has recommended values to the city
or county assessor, must be brought against the commissioner deleted text begin in Tax Court or in district
court of the county where the property is locateddeleted text end , and not against the county or taxing
district where the property is located.
new text begin
(b) This section governs administrative appeals and appeals to court of a claim that
utility or railroad operating property has been partially, unfairly, or unequally assessed,
or assessed at a valuation greater than its real or actual value, misclassified, or that the
property is exempt. This section applies only to property described in sections 270.81,
subdivision 1, 273.33, 273.35, 273.36, and 273.37, and only with regard to taxable net tax
capacities that have been provided to the city or county by the commissioner and which
have not been changed by city or county. If the taxable net tax capacity being appealed is
not the taxable net tax capacity established by the commissioner, or if the appeal claims
that the tax rate applied against the parcel is incorrect, or that the tax has been paid, this
section does not apply.
new text end
new text begin Subd. 2. new text end
new text begin Contents and filing of petition. new text end
new text begin
(a) In all appeals to court that are required
to be brought against the commissioner under this section, the petition initiating the appeal
must be served on the commissioner and must be filed with the Tax Court in Ramsey
County, as provided in paragraph (b) or (c).
new text end
new text begin (b) new text end If the appeal to court is from an order of the commissioner, it must be
brought under chapter 271new text begin , except that when the provisions of this section conflict with
chapter 271, this section prevails. In addition, the petition must include all the parcels
encompassed by that order which the petitioner claims have been partially, unfairly,
or unequally assessed, assessed at a valuation greater than their real or actual value,
misclassified, or are exempt. For this purpose, an order of the commissioner is either (1) a
certification or notice of value by the commissioner for property described in subdivision
1, or (2) the final determination by the commissioner of either an administrative appeal
conference or informal administrative appeal described in subdivision 4new text end .
new text begin (c) new text end If the appeal is from the deleted text begin exemption, valuation, classification, or deleted text end tax that results
from implementation of the commissioner's ordernew text begin , certification,new text end or recommendation, it
must be brought under chapter 278, and the provisions in that chapter apply, except that
service shall be on the commissioner only and not on the deleted text begin county deleted text end new text begin local new text end officials specified
in section 278.01, subdivision 1new text begin , and if any other provision of this section conflicts with
chapter 278, this section prevails. In addition, the petition must include either all the utility
parcels or all the railroad parcels in the state in which the petitioner claims an interest and
which the petitioner claims have been partially, unfairly, or unequally assessed, assessed
at a valuation greater than their real or actual value, misclassified, or are exemptnew text end . deleted text begin This
provision applies to the property described in sections 273.33, 273.35, 273.36, and 273.37,
but only if the appealed values have remained unchanged from those provided to the
city or county by the commissioner. If the exemption, valuation, or classification being
appealed has been changed by the city or county, then the action must be brought under
chapter 278 in the county where the property is located and proper service must be made
upon the county officials as specified in section 278.01, subdivision 1.
deleted text end
new text begin Subd. 3. new text end
new text begin Notice. new text end
Upon filing of any appeal new text begin in court new text end by a utility company or railroad
against the commissioner new text begin pursuant to this sectionnew text end , the commissioner shall give notice by
first class mail to new text begin the county auditor of new text end each county deleted text begin which would be affected by the appeal
deleted text end new text begin where property included in the petition is locatednew text end .
new text begin Subd. 4. new text end
new text begin Administrative appeals. new text end
new text begin (a) new text end Companies that submit the reports under
section 270.82 or 273.371 by the date specified in that section, or by the date specified
by the commissioner in an extension, may appeal administratively to the commissioner
deleted text begin under the procedures in section 270.11, subdivision 6,deleted text end prior to bringing an action in deleted text begin Tax
Court or in district deleted text end courtdeleted text begin , however, instituting an administrative appeal deleted text end new text begin by submitting
a written request new text end with the commissioner deleted text begin does not change or modify deleted text end new text begin for a conference
within ten days after the date of the commissioner's valuation certification or notice to
the company, or by May 15, whichever is earlier. The commissioner shall conduct the
conference upon the commissioner's entire files and records and such further information
as may be offered. The conference must be held no later than 20 days after the date
of the commissioner's valuation certification or notice to the company, or by the date
specified by the commissioner in an extension. Within 60 days after the conference the
commissioner shall make a final determination of the matter and shall notify the company
promptly of the determination. The conference is not a contested case hearing.
new text end
new text begin (b) In addition to the opportunity for a conference under paragraph (a), the
commissioner shall make a more informal procedure available to railroad and utility
companies to question values established by the commissioner through certification
or notice. The availability of the informal procedure does not change or modify the
deadline for requesting a conference under paragraph (a),new text end the deadline in section 271.06
for appealing an order of the commissioner deleted text begin in Tax Court deleted text end new text begin ,new text end or the deadline in section 278.01
for deleted text begin filing a property tax claim or objection in Tax Court or district deleted text end new text begin appealing property
taxes in new text end court.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective September 1, 2005, and thereafter.
new text end
Sec. 25.
Minnesota Statutes 2004, section 274.014, subdivision 2, is amended to read:
Subd. 2.
Appeals and equalization course.
deleted text begin By no later than January 1,deleted text end new text begin Beginning
in new text end 2006, and each year thereafter, there must be at least one member at each meeting of
a local board of appeal and equalization who has attended an appeals and equalization
course developed or approved by the commissioner within the last four years, as certified
by the commissioner. The course may be offered in conjunction with a meeting of the
Minnesota League of Cities or the Minnesota Association of Townships. The course
content must include, but need not be limited to, a review of the handbook developed
by the commissioner under subdivision 1.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 26.
Minnesota Statutes 2004, section 274.014, subdivision 3, is amended to read:
Subd. 3.
Proof of compliance; transfer of duties.
new text begin (a) new text end Any city or town that deleted text begin does
not deleted text end new text begin conducts local boards of appeal and equalization meetings must new text end provide proof to the
county assessor by December 1, 2006, and each year thereafter, that it is in compliance
with the requirements of subdivision 2deleted text begin , and that it had deleted text end new text begin . Beginning in 2006, this notice
must also verify that there was new text end a quorum new text begin of voting members new text end at each meeting of the board
of appeal and equalization in the deleted text begin prior deleted text end new text begin current new text end yeardeleted text begin ,deleted text end new text begin . A city or town that does not comply
with these requirements new text end is deemed to have transferred its board of appeal and equalization
powers to the county deleted text begin under section 274.01, subdivision 3, for deleted text end new text begin beginning with new text end the following
year's assessment new text begin and continuing unless the powers are reinstated under paragraph (c)new text end .
new text begin (b) new text end The county shall notify the taxpayers when the board of appeal and equalization
for a city or town has been transferred to the county under this subdivision and, prior to
the meeting time of the county board of equalization, the county shall make available to
those taxpayers a procedure for a review of the assessments, including, but not limited to,
open book meetings. This alternate review process shall take place in April and May.
new text begin (c) new text end A local board whose powers are transferred to the county under this subdivision
may be reinstated by resolution of the governing body of the city or town and upon proof
of compliance with the requirements of subdivision 2. The resolution and proofs must be
provided to the county assessor by December 1 in order to be effective for the following
year's assessment.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 27.
Minnesota Statutes 2004, section 274.14, is amended to read:
274.14 LENGTH OF SESSION; RECORD.
deleted text begin The county board of equalization or the special board of equalization appointed
by it shall meet during the last ten meeting days in June. For this purpose, "meeting
days" are defined as any day of the week excluding Saturday and Sunday.deleted text end The board may
meet on any ten consecutive meeting days in June, after the second Friday in Junedeleted text begin , if
deleted text end new text begin .new text end The actual meeting datesdeleted text begin are deleted text end new text begin must be new text end contained on the valuation notices mailed to each
property owner in the county deleted text begin under deleted text end new text begin as provided in new text end section 273.121. new text begin For this purpose,
"meeting days" is defined as any day of the week excluding Saturday and Sunday.new text end No
action taken by the county board of review after June 30 is valid, except for corrections
permitted in sections 273.01 and 274.01. The county auditor shall keep an accurate record
of the proceedings and orders of the board. The record must be published like other
proceedings of county commissioners. A copy of the published record must be sent to the
commissioner of revenue, with the abstract of assessment required by section 274.16.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 28.
Minnesota Statutes 2004, section 275.07, subdivision 1, is amended to read:
Subdivision 1.
Certification of levy.
(a) Except as provided under paragraph (b), the
taxes voted by cities, counties, school districts, and special districts shall be certified by
the proper authorities to the county auditor on or before five working days after December
20 in each year. A town must certify the levy adopted by the town board to the county
auditor by September 15 each year. If the town board modifies the levy at a special town
meeting after September 15, the town board must recertify its levy to the county auditor
on or before five working days after December 20. deleted text begin The taxes certified shall be reduced
by the county auditor by the aid received under section 273.1398, subdivision 3.deleted text end If a city,
town, county, school district, or special district fails to certify its levy by that date, its levy
shall be the amount levied by it for the preceding year.
(b)(i) The taxes voted by counties under sections 103B.241, 103B.245, and 103B.251
shall be separately certified by the county to the county auditor on or before five working
days after December 20 in each year. The taxes certified shall not be reduced by the county
auditor by the aid received under section 273.1398, subdivision 3. If a county fails to
certify its levy by that date, its levy shall be the amount levied by it for the preceding year.
(ii) For purposes of the proposed property tax notice under section 275.065 and
the property tax statement under section 276.04, for the first year in which the county
implements the provisions of this paragraph, the county auditor shall reduce the county's
levy for the preceding year to reflect any amount levied for water management purposes
under clause (i) included in the county's levy.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 29.
Minnesota Statutes 2004, section 275.07, subdivision 4, is amended to read:
Subd. 4.
Report to commissioner.
(a) On or before October 8 of each year, the
county auditor shall report to the commissioner of revenue the proposed levy certified by
local units of government under section 275.065, subdivision 1. If any taxing authorities
have notified the county auditor that they are in the process of negotiating an agreement for
sharing, merging, or consolidating services but that when the proposed levy was certified
under section 275.065, subdivision 1c, the agreement was not yet finalized, the county
auditor shall supply that information to the commissioner when filing the report under this
section and shall recertify the affected levies as soon as practical after October 10.
(b) On or before January 15 of each year, the county auditor shall report to the
commissioner of revenue the final levy certified by local units of government under
subdivision 1.
(c) The levies must be reported in the manner prescribed by the commissioner. deleted text begin The
reports must show a total levy and the amount of each special levy.
deleted 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. 30.
Minnesota Statutes 2004, section 276.112, is amended to read:
276.112 STATE PROPERTY TAXES; COUNTY TREASURER.
On or before January 25 each year, for the period ending December 31 of the prior
year, and on or before June deleted text begin 29 deleted text end new text begin 28 new text end each year, for the period ending on the most recent
settlement day determined in section 276.09, and on or before December 2 each year, for
the period ending November 20, the county treasurer must make full settlement with
the county auditor according to sections 276.09, 276.10, and 276.111 for all receipts of
state property taxes levied under section 275.025, and must transmit those receipts to the
commissioner of revenue by electronic means.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 31.
Minnesota Statutes 2004, section 282.016, is amended to read:
282.016 PROHIBITED PURCHASERS.
deleted text begin No deleted text end new text begin (a) A new text end county auditor, county treasurer, new text begin county attorney,new text end court administrator of the
district court, deleted text begin or deleted text end county assessordeleted text begin or deleted text end new text begin ,new text end supervisor of assessments, deleted text begin or deleted text end deputy or clerk or new text begin an
new text end employee of such officer, deleted text begin and no deleted text end new text begin a new text end commissioner for tax-forfeited lands or new text begin an new text end assistant to
such commissioner deleted text begin may deleted text end new text begin , must not new text end become a purchasernew text begin , either personally or as an agent
or attorney for another person,new text end of the properties offered for sale under the provisions of
this chapterdeleted text begin , either personally, or as agent or attorney for any other person, except that
deleted text end new text begin in the county for which the person performs duties. A person prohibited from purchasing
property under this section must not directly or indirectly have another person purchase it
on behalf of the prohibited purchaser for the prohibited purchaser's benefit or gain.
new text end
new text begin (b) Notwithstanding paragraph (a),new text end such officer, deputy,deleted text begin court administrator deleted text end new text begin clerknew text end , new text begin or
new text end employee or commissioner for tax-forfeited lands or assistant to such commissioner may
(1) purchase lands owned by that official at the time the state became the absolute owner
thereof or (2) bid upon and purchase forfeited property offered for sale under the alternate
sale procedure described in section 282.01, subdivision 7a.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 32.
Minnesota Statutes 2004, section 282.08, is amended to read:
282.08 APPORTIONMENT OF PROCEEDS TO TAXING DISTRICTS.
The net proceeds from the sale or rental of any parcel of forfeited land, or from the
sale of products from the forfeited land, must be apportioned by the county auditor to the
taxing districts interested in the land, as follows:
(1) deleted text begin the amounts necessary to pay the state general tax levy against the parcel for
taxes payable in the year for which the tax judgment was entered, and for each subsequent
payable year up to and including the year of forfeiture, must be apportioned to the state;
deleted text end
deleted text begin (2) deleted text end the portion required to pay any amounts included in the appraised value
under section 282.01, subdivision 3, as representing increased value due to any public
improvement made after forfeiture of the parcel to the state, but not exceeding the amount
certified by the clerk of the municipality must be apportioned to the municipal subdivision
entitled to it;
deleted text begin (3) deleted text end new text begin (2) new text end the portion required to pay any amount included in the appraised value under
section 282.019, subdivision 5, representing increased value due to response actions
taken after forfeiture of the parcel to the state, but not exceeding the amount of expenses
certified by the Pollution Control Agency or the commissioner of agriculture, must be
apportioned to the agency or the commissioner of agriculture and deposited in the fund
from which the expenses were paid;
deleted text begin (4) deleted text end new text begin (3) new text end the portion of the remainder required to discharge any special assessment
chargeable against the parcel for drainage or other purpose whether due or deferred at the
time of forfeiture, must be apportioned to the municipal subdivision entitled to it; and
deleted text begin (5) deleted text end new text begin (4) new text end any balance must be apportioned as follows:
(i) The county board may annually by resolution set aside no more than 30 percent
of the receipts remaining to be used for timber development on tax-forfeited land and
dedicated memorial forests, to be expended under the supervision of the county board. It
must be expended only on projects approved by the commissioner of natural resources.
(ii) The county board may annually by resolution set aside no more than 20 percent
of the receipts remaining to be used for the acquisition and maintenance of county parks
or recreational areas as defined in sections 398.31 to 398.36, to be expended under the
supervision of the county board.
(iii) Any balance remaining must be apportioned as follows: county, 40 percent;
town or city, 20 percent; and school district, 40 percent, provided, however, that in
unorganized territory that portion which would have accrued to the township must be
administered by the county board of commissioners.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment for
state general tax levy amounts payable in 2004 and thereafter.
new text end
Sec. 33.
Minnesota Statutes 2004, section 282.15, is amended to read:
282.15 SALES OF FORFEITED AGRICULTURAL LANDS.
The sale shall be conducted by the auditor of the county in which the parcels lie. The
parcels shall be sold to the highest bidder but not for less than the appraised value. The
sales shall be for cash or on the following terms: The appraised value of all merchantable
timber on agricultural lands shall be paid for in full at the date of sale. At least 15 percent
of the purchase price of the land shall be paid in cash at the time of purchase. The balance
shall be paid in not more than 20 equal annual installments, with interest at a rate equal to
the rate in effect at the time under section 549.09 on the unpaid balance each year. Both
principal and interest are due and payable on December 31 each year following that in
which the purchase was made. The purchaser may pay any number of installments of
principal and interest on or before their due date. When the sale is on terms other than for
cash in full, the purchaser shall receive from the county auditor a contract for deed, in a
form prescribed by the attorney general. The county auditor shall make a report to the
commissioner of natural resources not more than 30 days after each public sale showing
the lands sold at the sales, and submit a copy of each contract of sale.
All lands sold pursuant to this section deleted text begin shall, on the second day of January following
the date of the sale,deleted text end new text begin must new text end be restored to the tax rolls and become subject to taxation in the
same manner as they were assessed and taxed before becoming the absolute property
of the state new text begin for the assessment year determined under section 272.02, subdivision 38,
paragraph (c)new text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for sales occurring on or after July
1, 2005.
new text end
Sec. 34.
Minnesota Statutes 2004, section 282.21, is amended to read:
282.21 FORM OF CONVEYANCE.
new text begin When any sale has been made under sections 282.14 to 282.22,new text end upon payment in full
of the purchase price, appropriate conveyance in fee in such form as may be prescribed by
the attorney general shall be issued by the commissioner of finance to the purchaser or
the purchaser's assigns and this conveyance shall have the force and effect of a patent
from the state.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 35.
Minnesota Statutes 2004, section 282.224, is amended to read:
282.224 FORM OF CONVEYANCE.
new text begin When any sale has been made under sections 282.221 to 282.226,new text end upon payment in
full of the purchase pricenew text begin ,new text end appropriate conveyance in fee, in such form as may be prescribed
by the attorney general, shall be issued by the commissioner of natural resources to the
purchaser or the purchaser's assignee, and the conveyance shall have the force and effect
of a patent from the state.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 36.
Minnesota Statutes 2004, section 282.301, is amended to read:
282.301 RECEIPTS FOR PAYMENTS.
new text begin When any sale has been made under sections 282.012 and 282.241 to 282.324,new text end the
purchaser shall receive from the county auditor at the time of repurchase a receipt, in such
form as may be prescribed by the attorney general. When the purchase price of a parcel of
land shall be paid in full, the following facts shall be certified by the county auditor to the
commissioner of revenue of the state of Minnesota: the description of land, the date of
sale, the name of the purchaser or the purchaser's assignee, and the date when the final
installment of the purchase price was paid. Upon payment in full of the purchase price,
the purchaser or the assignee shall receive a quitclaim deed from the state, to be executed
by the commissioner of revenue. The deed must be sent to the county auditor who shall
have it recorded before it is forwarded to the purchaser. Failure to make any payment
herein required shall constitute default and upon such default and cancellation in accord
with section 282.40, the right, title and interest of the purchaser or the purchaser's heirs,
representatives, or assigns in such parcel shall terminate.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 37.
Minnesota Statutes 2004, section 290B.05, subdivision 3, is amended to read:
Subd. 3.
Calculation of deferred property tax amount.
When final property tax
amounts for the following year have been determined, the county auditor shall calculate
the "deferred property tax amount." The deferred property tax amount is equal to the
lesser of (1) the maximum allowable deferral for the year; or (2) the difference between
new text begin (i) new text end the total amount of property taxes new text begin and special assessments new text end levied upon the qualifying
homestead by all taxing jurisdictions and new text begin (ii) new text end the maximum property tax amount. deleted text begin Any
special assessments levied by any local unit of government must not be included in the
total tax used to calculate the deferred tax amount.deleted text end new text begin For this purpose "special assessments"
includes any assessment, fee, or other charge that may by law, and which does, appear on
the property tax statement for the property for collection under the laws applicable to the
enforcement of real estate taxes.new text end Any tax attributable to new improvements made to the
property after the initial application has been approved under section 290B.04, subdivision
2, must be excluded when determining any subsequent deferred property tax amount.
The county auditor shall annually, on or before April 15, certify to the commissioner of
revenue the property tax deferral amounts determined under this subdivision by property
and by owner.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for amounts deferred in 2006 and
thereafter.
new text end
Sec. 38.
Minnesota Statutes 2004, section 290C.05, is amended to read:
290C.05 ANNUAL CERTIFICATION.
On or before July 1 of each year, beginning with the year after the claimant has
received an approved application, the commissioner shall send each claimant enrolled
under the sustainable forest incentive program a certification form. The claimant must sign
the certification, attesting that the requirements and conditions for continued enrollment in
the program are currently being met, and must return the signed certification form to the
commissioner by August 15 of that same year. deleted text begin Failure to deleted text end new text begin If the claimant does not new text end return
an annual certification form by the due date deleted text begin shall result in removal of the lands from
the provisions of the sustainable forest incentive program, and the imposition of any
applicable removal penalty deleted text end new text begin , the provisions in section 290C.11 applynew text end . deleted text begin The claimant may
appeal the removal and any associated penalty according to the procedures and within the
time allowed under this chapter.
deleted 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. 39.
new text begin
[290C.055] LENGTH OF COVENANT.
new text end
new text begin
The covenant remains in effect for a minimum of eight years. If land is removed
from the program before it has been enrolled for four years, the covenant remains in
effect for eight years from the date recorded.
new text end
new text begin
If land that has been enrolled for four years or more is removed from the program
for any reason, there is a waiting period before the covenant terminates. The covenant
terminates on January 1 of the fifth calendar year that begins after the date that:
new text end
new text begin
(1) the commissioner receives notification from the claimant that the claimant wishes
to remove the land from the program under section 290C.10; or
new text end
new text begin
(2) the date that the land is removed from the program under section 290C.11.
new text end
new text begin
Notwithstanding the other provisions of this section, the covenant is terminated at
the same time that the land is removed from the program due to acquisition of title or
possession for a public purpose under section 290C.10.
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. 40.
Minnesota Statutes 2004, section 290C.10, is amended to read:
290C.10 WITHDRAWAL PROCEDURES.
An approved claimant under the sustainable forest incentive program for a minimum
of four years may notify the commissioner of the intent to terminate enrollment. Within
90 days of receipt of notice to terminate enrollment, the commissioner shall inform the
claimant in writing, acknowledging receipt of this notice and indicating the effective date
of termination from the sustainable forest incentive program. Termination of enrollment
in the sustainable forest incentive program occurs on January 1 of the fifth calendar
year that begins after receipt by the commissioner of the termination notice. After the
commissioner issues an effective date of termination, a claimant wishing to continue the
land's enrollment in the sustainable forest incentive program beyond the termination
date must apply for enrollment as prescribed in section 290C.04. A claimant who
withdraws a parcel of land from this program may not reenroll the parcel for a period of
three years. Within 90 days after the termination date, the commissioner shall execute
and acknowledge a document releasing the land from the covenant required under this
chapter. The document must be mailed to the claimant and is entitled to be recorded.
The commissioner may allow early withdrawal from the Sustainable Forest Incentive
Act without penalty deleted text begin in cases of condemnation deleted text end new text begin when the state of Minnesota, any local
government unit, or any other entity which has the right of eminent domain acquires
title or possession to the land new text end for a public purpose notwithstanding the provisions of this
section. new text begin In the case of such acquisition, the commissioner shall execute and acknowledge
a document releasing the land acquired by the state, local government unit, or other entity
from the covenant. All other enrolled land must remain in the program.
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. 41.
Minnesota Statutes 2004, section 373.45, subdivision 7, is amended to read:
Subd. 7.
Aid reduction for repayment.
(a) Except as provided in paragraph (b),
the commissioner may reduce, by the amount paid by the state under this section on behalf
of the county, plus the interest due on the state payments, thedeleted text begin following aids payable
to the county:
deleted text end
deleted text begin
(1) homestead and agricultural credit aid and disparity reduction aid payable under
section 273.1398;
deleted text end
deleted text begin
(2) county criminal justice aid payable under section 477A.0121; and
deleted text end
deleted text begin (3) family preservation aid payable under section 477A.0122 deleted text end new text begin county program aid
under section 477A.0124new text end .
The amount of any aid reduction reverts from the appropriate account to the state general
fund.
(b) If, after review of the financial situation of the county, the authority advises the
commissioner that a total reduction of the aids would cause an undue hardship on the
county, the authority, with the approval of the commissioner, may establish a different
schedule for reduction of aids to repay the state. The amount of aids to be reduced are
decreased by any amounts repaid to the state by the county from other revenue sources.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for aid payable in 2005 and thereafter.
new text end
Sec. 42.
Minnesota Statutes 2004, section 469.1735, subdivision 3, is amended to read:
Subd. 3.
Transfer authority for property tax.
(a) A city may elect to use all
or part of its allocation under subdivision 2 to reimburse the city or county or both for
property tax reductions under section 272.0212. To elect this option, the city must notify
the commissioner of revenue by October 1 of each calendar year of the amount of the
property tax reductions new text begin for which new text end it seeks reimbursements for taxes payable during the
deleted text begin following deleted text end new text begin current new text end year and the governmental units to which the amounts will be paid. The
commissioner may require the city to provide information substantiating the amount of the
reductions granted or any other information necessary to administer this provision. The
commissioner shall pay the reimbursements by December 26 new text begin of the taxes payable yearnew text end .
Any amount transferred under this authority reduces the amount of tax credit certificates
available under subdivisions 1 and 2.
(b) The amount elected by the city under paragraph (a) is appropriated to the
commissioner of revenue from the general fund to reimburse the city or county for
tax reductions under section 272.0212. The amount appropriated may not exceed the
maximum amounts allocated to a city under subdivision 2, paragraph (b), less the amount
of certificates issued by the city under subdivision 1, and is available until expended.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for reimbursements of taxes payable
in 2005 and thereafter.
new text end
Sec. 43.
Laws 2003, chapter 127, article 5, section 27, the effective date, is amended to
read:
new text begin EFFECTIVE DATE. new text end
This section is effective for deleted text begin taxes payable in 2004 and
thereafter deleted text end new text begin distributions occurring on or after June 10, 2003new text end .
Sec. 44.
Laws 2003, chapter 127, article 5, section 28, the effective date, is amended to
read:
new text begin EFFECTIVE DATE. new text end
This section is effective for deleted text begin taxes payable in 2004 and
thereafter deleted text end new text begin distributions occurring on or after June 10, 2003new text end .
Sec. 45. new text begin LINCOLN AND PIPESTONE COUNTIES; TOWN LEVY
ADJUSTMENT FOR WIND ENERGY PRODUCTION TAX.
new text end
new text begin
Notwithstanding the deadlines in Minnesota Statutes, section 275.07, towns located
in Lincoln or Pipestone County are authorized to adjust their payable 2004 levy for all or a
portion of their estimated wind energy production tax amounts for 2004, as computed by
the commissioner of revenue from reports filed under Minnesota Statutes, section 272.029,
subdivision 4. The Lincoln and Pipestone County auditors may adjust the payable 2004
levy certifications under Minnesota Statutes, section 275.07, subdivision 1, based upon the
towns that have recertified their levies under this section by March 15, 2004.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxes payable in 2004.
new text end
Sec. 46. new text begin REPEALER.
new text end
new text begin
(a) Minnesota Statutes 2004, sections 273.19, subdivision 5; 274.05; 275.15; 275.61,
subdivision 2; and 283.07, are repealed effective the day following final enactment.
new text end
new text begin
(b) Minnesota Statutes 2004, section 469.1794, subdivision 6, is repealed effective
the day following final enactment and applies to districts for which the request for
certification was made on, before, or after August 1, 1979, and before August 1, 2001.
new text end
new text begin
(c) Laws 1975, chapter 287, section 5, and Laws 2003, chapter 127, article 9, section
9, subdivision 4, are repealed effective without local approval for taxes payable in 2006
and thereafter.
new text end
new text begin
(d) Minnesota Statutes 2004, sections 270.85; 270.88; and 273.37, subdivision 3,
are repealed effective September 1, 2005.
new text end
ARTICLE 5
INCOME, CORPORATE FRANCHISE, AND ESTATE TAXES
Section 1.
Minnesota Statutes 2004, section 190.09, subdivision 2, is amended to read:
Subd. 2.
Mission; efficiency.
It is part of the department's mission that within the
department's resources the adjutant general shall endeavor to:
(1) prevent the waste or unnecessary spending of public money;
(2) use innovative fiscal and human resource practices to manage the state's
resources and operate the department as efficiently as possible;
(3) coordinate the department's activities wherever appropriate with the activities
of other governmental agencies;
(4) use technology where appropriate to increase agency productivity, improve
customer service, increase public access to information about government, and increase
public participation in the business of government;
(5) utilize constructive and cooperative labor-management practices to the extent
otherwise required by chapters 43A and 179A;
(6) report to the legislature on the performance of agency operations and the
accomplishment of agency goals in the agency's biennial budget according to section
16A.10, subdivision 1; deleted text begin and
deleted text end
(7) recommend to the legislature appropriate changes in law necessary to carry out
the mission and improve the performance of the departmentnew text begin ; and
new text end
new text begin (8) administer checkoff funds as provided in section 290.433new text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxable years beginning after
December 31, 2004.
new text end
Sec. 2.
Minnesota Statutes 2004, section 289A.08, subdivision 1, is amended to read:
Subdivision 1.
Generally; individuals.
(a) A taxpayer must file a return for each
taxable year the taxpayer is required to file a return under section 6012 of the Internal
Revenue Code, except thatnew text begin :
new text end
new text begin (1) new text end an individual who is not a Minnesota resident for any part of the year is not
required to file a Minnesota income tax return if the individual's gross income derived
from Minnesota sources as determined under sections 290.081, paragraph (a), and 290.17,
is less than the filing requirements for a single individual who is a full year resident of
Minnesotanew text begin ; and
new text end
new text begin (2) an individual who is a Minnesota resident is not required to file a Minnesota
income tax return if the individual's gross income derived from Minnesota sources as
determined under section 290.17, less the amount of the individual's gross income that
consists of compensation paid to members of the armed forces of the United States
or United Nations for active duty performed outside Minnesota, is less than the filing
requirements for a single individual who is a full-year resident of Minnesotanew text end .
(b) The decedent's final income tax return, and other income tax returns for prior
years where the decedent had gross income in excess of the minimum amount at which
an individual is required to file and did not file, must be filed by the decedent's personal
representative, if any. If there is no personal representative, the return or returns must
be filed by the transferees, as defined in section 289A.38, subdivision 13, who receive
property of the decedent.
(c) The term "gross income," as it is used in this section, has the same meaning
given it in section 290.01, subdivision 20.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxable years beginning after
December 31, 2004.
new text end
Sec. 3.
Minnesota Statutes 2004, section 289A.08, subdivision 3, is amended to read:
Subd. 3.
Corporations.
A corporation that is subject to the state's jurisdiction to tax
under section 290.014, subdivision 5, must file a return, except that a foreign operating
corporation as defined in section 290.01, subdivision 6b, is not required to file a return.
The commissioner shall adopt rules for the filing of one return on behalf of the members
of an affiliated group of corporations that are required to file a combined report. All
members of an affiliated group that are required to file a combined report must file one
return on behalf of the members of the group under rules adopted by the commissioner.
new text begin If a corporation claims on a return that it has paid tax in excess of the amount of taxes
lawfully due, that corporation must include on that return information necessary for
payment of the tax in excess of the amount lawfully due by electronic means.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for returns filed after December
31, 2005.
new text end
Sec. 4.
Minnesota Statutes 2004, section 289A.08, subdivision 7, is amended to read:
Subd. 7.
Composite income tax returns for nonresident partners, shareholders,
and beneficiaries.
(a) The commissioner may allow a partnership with nonresident
partners to file a composite return and to pay the tax on behalf of nonresident partners who
have no other Minnesota source income. This composite return must include the names,
addresses, Social Security numbers, income allocation, and tax liability for the nonresident
partners electing to be covered by the composite return.
(b) The computation of a partner's tax liability must be determined by multiplying
the income allocated to that partner by the highest rate used to determine the tax liability
for individuals under section 290.06, subdivision 2c. Nonbusiness deductions, standard
deductions, or personal exemptions are not allowed.
(c) The partnership must submit a request to use this composite return filing method
for nonresident partners. The requesting partnership must file a composite return in the
form prescribed by the commissioner of revenue. The filing of a composite return is
considered a request to use the composite return filing method.
(d) The electing partner must not have any Minnesota source income other than
the income from the partnership and other electing partnerships. If it is determined that
the electing partner has other Minnesota source income, the inclusion of the income
and tax liability for that partner under this provision will not constitute a return to
satisfy the requirements of subdivision 1. The tax paid for the individual as part of the
composite return is allowed as a payment of the tax by the individual on the date on
which the composite return payment was made. If the electing nonresident partner has no
other Minnesota source income, filing of the composite return is a return for purposes of
subdivision 1.
(e) This subdivision does not negate the requirement that an individual pay estimated
tax if the individual's liability would exceed the requirements set forth in section 289A.25.
A composite estimate may, however, be filed in a manner similar to and containing the
information required under paragraph (a).
(f) If an electing partner's share of the partnership's gross income from Minnesota
sources is less than the filing requirements for a nonresident under this subdivision, the tax
liability is zero. However, a statement showing the partner's share of gross income must
be included as part of the composite return.
(g) The election provided in this subdivision is deleted text begin not deleted text end new text begin only new text end available to deleted text begin any deleted text end new text begin a new text end partner
deleted text begin other than deleted text end new text begin who has no other Minnesota source income and who is either (1) new text end a full-year
nonresident individual deleted text begin who has no other Minnesota source income deleted text end new text begin or (2) a trust or estate
that does not claim a deduction under either section 651 or 661 of the Internal Revenue
Codenew text end .
(h) A corporation defined in section 290.9725 and its nonresident shareholders may
make an election under this paragraph. The provisions covering the partnership apply to
the corporation and the provisions applying to the partner apply to the shareholder.
(i) Estates and trusts distributing current income only and the nonresident individual
beneficiaries of the estates or trusts may make an election under this paragraph. The
provisions covering the partnership apply to the estate or trust. The provisions applying to
the partner apply to the beneficiary.
new text begin
(j) For the purposes of this subdivision, "income" means the partner's share of
federal adjusted gross income from the partnership modified by the additions provided
in section 290.01, subdivision 19a, clauses (6) and (7), and the subtractions provided in
section 290.01, subdivision 19b, clause (11), to the extent the amount is assignable or
allocable to Minnesota under section 290.17. The subtraction allowed under section
290.01, subdivision 19b, clause (11), is only allowed on the composite tax computation to
the extent the electing partner would have been allowed the subtraction.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2004.
new text end
Sec. 5.
Minnesota Statutes 2004, section 289A.08, subdivision 13, is amended to read:
Subd. 13.
Long and short forms.
The commissioner shall provide a long form
individual income tax return and may provide a short form individual income tax return.
The returns shall be in a form that is consistent with the provisions of chapter 290,
notwithstanding any other law to the contrary. The nongame wildlife checkoff provided
in section 290.431 and the dependent care credit provided in section 290.067 must be
included on the short form. new text begin The commissioner must provide information on local use
taxes in the individual income tax instruction booklet, including a list of the jurisdictions
with local use taxes. The commissioner must provide this information in the same section
of the booklet that provides information on the state use tax.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxable years beginning after
December 31, 2004.
new text end
Sec. 6.
Minnesota Statutes 2004, section 289A.18, subdivision 1, is amended to read:
Subdivision 1.
Individual income, fiduciary income, corporate franchise, and
entertainment taxes; partnership and s corporation returns; information returns;
mining company returns.
The returns required to be made under sections 289A.08 and
289A.12 must be filed at the following times:
(1) returns made on the basis of the calendar year must be filed on April 15 following
the close of the calendar year, except that returns of corporations must be filed on March
15 following the close of the calendar year;
(2) returns made on the basis of the fiscal year must be filed on the 15th day of the
fourth month following the close of the fiscal year, except that returns of corporations
must be filed on the 15th day of the third month following the close of the fiscal year;
(3) returns for a fractional part of a year must be filed on the 15th day of the fourth
month following the end of the month in which falls the last day of the period for which
the return is made, except that the returns of corporations must be filed on the 15th day
of the third month following the end of the deleted text begin month deleted text end new text begin tax year of the unitary group new text end in which
falls the last day of the period for which the return is made;
(4) in the case of a final return of a decedent for a fractional part of a year, the return
must be filed on the 15th day of the fourth month following the close of the 12-month
period that began with the first day of that fractional part of a year;
(5) in the case of the return of a cooperative association, returns must be filed on or
before the 15th day of the ninth month following the close of the taxable year;
(6) if a corporation has been divested from a unitary group and files a return for
a fractional part of a year in which it was a member of a unitary business that files a
combined report under section 290.34, subdivision 2, the divested corporation's return
must be filed on the 15th day of the third month following the close of the common
accounting period that includes the fractional year;
(7) returns of entertainment entities must be filed on April 15 following the close of
the calendar year;
(8) returns required to be filed under section 289A.08, subdivision 4, must be filed
on the 15th day of the fifth month following the close of the taxable year;
(9) returns of mining companies must be filed on May 1 following the close of the
calendar year; and
(10) returns required to be filed with the commissioner under section 289A.12,
subdivision 2, 4 to 10, or 14, must be filed within 30 days after being demanded by the
commissioner.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for fractional years closing after
December 31, 2004.
new text end
Sec. 7.
Minnesota Statutes 2004, section 289A.19, subdivision 4, is amended to read:
Subd. 4.
Estate tax returns.
deleted text begin When in the commissioner's judgment good cause
exists, the commissioner may extend the time for filing an estate tax return for not more
than six months.deleted text end When an extension to file the federal estate tax return has been granted
under section 6081 of the Internal Revenue Code, the time for filing the estate tax return
is extended for that period. new text begin If the estate requests an extension to file an estate tax return
within the time provided in section 289A.18, subdivision 3, the commissioner shall extend
the time for filing the estate tax return for six months.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for estates of decedents dying after
December 31, 2004.
new text end
Sec. 8.
Minnesota Statutes 2004, section 289A.20, subdivision 2, is amended to read:
Subd. 2.
Withholding from wages, entertainer withholding, withholding from
payments to out-of-state contractors, and withholding by partnerships and small
business corporations.
(a) A tax required to be deducted and withheld during the
quarterly period must be paid on or before the last day of the month following the close of
the quarterly period, unless an earlier time for payment is provided. A tax required to be
deducted and withheld from compensation of an entertainer and from a payment to an
out-of-state contractor must be paid on or before the date the return for such tax must be
filed under section 289A.18, subdivision 2. Taxes required to be deducted and withheld
by partnerships deleted text begin and deleted text end new text begin ,new text end S corporationsnew text begin , and trusts new text end must be paid on deleted text begin or before the date the
return must be filed under section 289A.18, subdivision 2 deleted text end new text begin a quarterly basis as estimated
taxes under section 289A.25 for partnerships and trusts and under section 289A.26 for S
corporationsnew text end .
(b) An employer who, during the previous quarter, withheld more than $1,500 of
tax under section 290.92, subdivision 2a or 3, or 290.923, subdivision 2, must deposit tax
withheld under those sections with the commissioner within the time allowed to deposit
the employer's federal withheld employment taxes under Code of Federal Regulations,
title 26, section 31.6302-1, as amended through December 31, 2001, without regard to the
safe harbor or de minimis rules in subparagraph (f) or the one-day rule in subsection (c),
clause (3). Taxpayers must submit a copy of their federal notice of deposit status to the
commissioner upon request by the commissioner.
(c) The commissioner may prescribe by rule other return periods or deposit
requirements. In prescribing the reporting period, the commissioner may classify payors
according to the amount of their tax liability and may adopt an appropriate reporting
period for the class that the commissioner judges to be consistent with efficient tax
collection. In no event will the duration of the reporting period be more than one year.
(d) If less than the correct amount of tax is paid to the commissioner, proper
adjustments with respect to both the tax and the amount to be deducted must be made,
without interest, in the manner and at the times the commissioner prescribes. If the
underpayment cannot be adjusted, the amount of the underpayment will be assessed and
collected in the manner and at the times the commissioner prescribes.
(e) If the aggregate amount of the tax withheld during a fiscal year ending June 30
under section 290.92, subdivision 2a or 3, is equal to or exceeds the amounts established
for remitting federal withheld taxes pursuant to the regulations promulgated under section
6302(h) of the Internal Revenue Code, the employer must remit each required deposit for
wages paid in the subsequent calendar year by electronic means.
(f) A third-party bulk filer as defined in section 290.92, subdivision 30, paragraph
(a), clause (2), who remits withholding deposits must remit all deposits by electronic
means as provided in paragraph (e), regardless of the aggregate amount of tax withheld
during a fiscal year for all of the employers.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2005.
new text end
Sec. 9.
Minnesota Statutes 2004, section 289A.31, subdivision 2, is amended to read:
Subd. 2.
Joint income tax returns.
(a) If a joint income tax return is made by a
husband and wife, the liability for the tax is joint and several. A spouse who qualifies for
relief from a liability attributable to an underpayment under section 6015(b) of the Internal
Revenue Code is relieved of the state income tax liability on the underpayment.
(b) In the case of individuals who were a husband and wife prior to the dissolution of
their marriage or their legal separation, or prior to the death of one of the individuals, for
tax liabilities reported on a joint or combined return, the liability of each person is limited
to the proportion of the tax due on the return that equals that person's proportion of the
total tax due if the husband and wife filed separate returns for the taxable year. This
provision is effective only when the commissioner receives written notice of the marriage
dissolution, legal separation, or death of a spouse from the husband or wife. No refund
may be claimed by an ex-spouse, legally separated or widowed spouse for any taxes paid
more than 60 days before receipt by the commissioner of the written notice.
new text begin
(c) A request for calculation of separate liability pursuant to paragraph (b) for taxes
reported on a return must be made within six years after the due date of the return.
For calculation of separate liability for taxes assessed by the commissioner under
section 289A.35 or 289A.37, the request must be made within six years after the date
of assessment. The commissioner is not required to calculate separate liability if the
remaining unpaid liability for which recalculation is requested is $100 or less.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for requests for relief made on or
after the day following final enactment.
new text end
Sec. 10.
Minnesota Statutes 2004, section 289A.38, subdivision 7, is amended to read:
Subd. 7.
Federal tax changes.
If the amount of income, items of tax preference,
deductions, or credits for any year of a taxpayer as reported to the Internal Revenue
Service is changed or corrected by the commissioner of Internal Revenue or other officer
of the United States or other competent authority, or where a renegotiation of a contract or
subcontract with the United States results in a change in income, items of tax preference,
deductions, credits, or withholding tax, or, in the case of estate tax, where there are
adjustments to the taxable estate resulting in a change to the credit for state death taxes,
the taxpayer shall report the change or correction or renegotiation results in writing to the
commissioner. The report must be submitted within 180 days after the final determination
and must be in the form of either an amended Minnesota estate, withholding tax, new text begin corporate
franchise tax,new text end or income tax return conceding the accuracy of the federal determination
or a letter detailing how the federal determination is incorrect or does not change the
Minnesota tax. An amended Minnesota income tax return must be accompanied by an
amended property tax refund return, if necessary. A taxpayer filing an amended federal
tax return must also file a copy of the amended return with the commissioner of revenue
within 180 days after filing the amended return.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 11.
Minnesota Statutes 2004, section 289A.50, subdivision 1a, is amended to read:
Subd. 1a.
Refund form.
On or before January 1, 2000, the commissioner of
revenue shall prepare and make available to taxpayers a form for filing claims for refund
of taxes paid in excess of the amount due. deleted text begin If the commissioner fails to prepare a form
under this subdivision by January 1, 2000, any claims for refund made after January 1,
2000, and up to ten days after the form is made available to taxpayers are deemed to be
made in compliance with the requirement of the form.deleted text end new text begin The commissioner may require
corporate franchise taxpayers claiming a refund of corporate franchise taxes paid in
excess of the amount lawfully due to include on the claim for refund or amended return
information necessary for payment of the taxes paid in excess of taxes lawfully due by
electronic means.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for claims for refund filed after
December 31, 2005.
new text end
Sec. 12.
Minnesota Statutes 2004, section 289A.60, subdivision 13, is amended to read:
Subd. 13.
Penalties for tax return preparers.
(a) If an understatement of liability
with respect to a return or claim for refund is due to a new text begin reckless disregard of laws and rules
or new text end willful attempt in any manner to understate the liability for a tax by a person who
is a tax return preparer with respect to the return or claim, the person shall pay to the
commissioner a penalty of $500. If a part of a property tax refund claim is excessive due
to a new text begin reckless disregard or new text end willful attempt in any manner to overstate the claim for relief
allowed under chapter 290A by a person who is a tax refund or return preparer, the person
shall pay to the commissioner a penalty of $500 with respect to the claim. These penalties
may not be assessed against the employer of a tax return preparer unless the employer was
actively involved in the new text begin reckless disregard or new text end willful attempt to understate the liability for
a tax or to overstate the claim for refund. These penalties are income tax liabilities and
may be assessed at any time as provided in section 289A.38, subdivision 5.
(b) A civil action in the name of the state of Minnesota may be commenced to
enjoin any person who is a tax return preparer doing business in this state from further
engaging in any conduct described in paragraph (c). An action under this paragraph
must be brought by the attorney general in the district court for the judicial district of the
tax return preparer's residence or principal place of business, or in which the taxpayer
with respect to whose tax return the action is brought resides. The court may exercise its
jurisdiction over the action separate and apart from any other action brought by the state
of Minnesota against the tax return preparer or any taxpayer.
(c) In an action under paragraph (b), if the court finds that a tax return preparer has:
(1) engaged in any conduct subject to a civil penalty under section 289A.60 or a
criminal penalty under section 289A.63;
(2) misrepresented the preparer's eligibility to practice before the Department of
Revenue, or otherwise misrepresented the preparer's experience or education as a tax
return preparer;
(3) guaranteed the payment of any tax refund or the allowance of any tax credit; or
(4) engaged in any other fraudulent or deceptive conduct that substantially interferes
with the proper administration of state tax law, and injunctive relief is appropriate to
prevent the recurrence of that conduct,
the court may enjoin the person from further engaging in that conduct.
(d) If the court finds that a tax return preparer has continually or repeatedly engaged
in conduct described in paragraph (c), and that an injunction prohibiting that conduct
would not be sufficient to prevent the person's interference with the proper administration
of state tax laws, the court may enjoin the person from acting as a tax return preparer.
The court may not enjoin the employer of a tax return preparer for conduct described in
paragraph (c) engaged in by one or more of the employer's employees unless the employer
was also actively involved in that conduct.
(e) For purposes of this subdivision, the term "understatement of liability" means
an understatement of the net amount payable with respect to a tax imposed by state tax
law, or an overstatement of the net amount creditable or refundable with respect to a
tax. The determination of whether or not there is an understatement of liability must be
made without regard to any administrative or judicial action involving the taxpayer. For
purposes of this subdivision, the amount determined for underpayment of estimated tax
under either section 289A.25 or 289A.26 is not considered an understatement of liability.
(f) For purposes of this subdivision, the term "overstatement of claim" means an
overstatement of the net amount refundable with respect to a claim for property tax relief
provided by chapter 290A. The determination of whether or not there is an overstatement
of a claim must be made without regard to administrative or judicial action involving
the claimant.
(g) For purposes of this section, the term "tax refund or return preparer" means an
individual who prepares for compensation, or who employs one or more individuals to
prepare for compensation, a return of tax, or a claim for refund of tax. The preparation of
a substantial part of a return or claim for refund is treated as if it were the preparation of
the entire return or claim for refund. An individual is not considered a tax return preparer
merely because the individual:
(1) gives typing, reproducing, or other mechanical assistance;
(2) prepares a return or claim for refund of the employer, or an officer or employee
of the employer, by whom the individual is regularly and continuously employed;
(3) prepares a return or claim for refund of any person as a fiduciary for that person;
or
(4) prepares a claim for refund for a taxpayer in response to a tax order issued
to the taxpayer.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for returns filed after December
31, 2005.
new text end
Sec. 13.
Minnesota Statutes 2004, section 289A.60, is amended by adding a
subdivision to read:
new text begin Subd. 26. new text end
new text begin
Restrictions on taxpayers who improperly claim refundable credits.
new text end
new text begin
(a) If a person claims a credit or refund under section 290.067, 290.0671, 290.0674, or
chapter 290A and the claimed credit or refund is determined to be claimed fraudulently or
with reckless or intentional disregard of the applicable provisions for the credit or refund,
the person is barred from claiming that credit or refund for the disallowance period.
new text end
new text begin
(b) For the purposes of paragraph (a), the "disallowance period" is (1) ten taxable
years from the taxable year the credit or refund is claimed if the credit or refund was
fraudulently claimed; and (2) two taxable years from the taxable year the credit or refund
is claimed if the credit or refund was not fraudulent but was claimed with reckless or
intentional disregard of the applicable provisions.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for credits or refunds claimed after
December 31, 2005.
new text end
Sec. 14.
Minnesota Statutes 2004, section 290.01, subdivision 7, is amended to read:
Subd. 7.
Resident.
(a) The term "resident" means any individual domiciled in
Minnesota, except that an individual is not a "resident" for the period of time that the
individual isdeleted text begin either:
deleted text end
deleted text begin
(1) on active duty stationed outside of Minnesota while in the armed forces of the
United States or the United Nations; or
deleted text end
deleted text begin (2) deleted text end a "qualified individual" as defined in section 911(d)(1) of the Internal Revenue
Code, if the qualified individual notifies the county within three months of moving out of
the country that homestead status be revoked for the Minnesota residence of the qualified
individual, and the property is not classified as a homestead while the individual remains a
qualified individual.
(b) "Resident" also means any individual domiciled outside the state who maintains
a place of abode in the state and spends in the aggregate more than one-half of the tax
year in Minnesota, unless:
(1) the individual or the spouse of the individual is in the armed forces of the United
States; or
(2) the individual is covered under the reciprocity provisions in section 290.081.
For purposes of this subdivision, presence within the state for any part of a calendar
day constitutes a day spent in the state. Individuals shall keep adequate records to
substantiate the days spent outside the state.
The term "abode" means a dwelling maintained by an individual, whether or not
owned by the individual and whether or not occupied by the individual, and includes a
dwelling place owned or leased by the individual's spouse.
(c) Neither the commissioner nor any court shall considerdeleted text begin charitable contributions
made by an individual within or without the state deleted text end new text begin the following factors new text end in determining if
the individual is domiciled in Minnesotanew text begin :
new text end
new text begin
(1) charitable contributions made by an individual within or without the state;
new text end
new text begin
(2) the jurisdiction from which an individual's professional licenses were issued;
new text end
new text begin
(3) the location of an individual's union memberships;
new text end
new text begin
(4) the location of accounts or transactions with financial institutions;
new text end
new text begin
(5) the location of the place of worship at which the individual is a member;
new text end
new text begin
(6) the location of business relationships and the place where business is transacted;
new text end
new text begin
(7) the location of social, fraternal, or athletic organizations or clubs, lodges, or
country clubs, in which the individual is a member; and
new text end
new text begin (8) statements made to an insurance company, concerning the individual's residence
and on which insurance is basednew text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2004.
new text end
Sec. 15.
Minnesota Statutes 2004, section 290.01, subdivision 7b, is amended to read:
Subd. 7b.
Resident trust.
new text begin (a) new text end Resident trust means a trust, except a grantor type
trust, which either (1) was created by a will of a decedent who at death was domiciled in
this state or (2) is an irrevocable trust, the grantor of which was domiciled in this state
at the time the trust became irrevocable. For the purpose of this subdivision, a trust is
considered irrevocable to the extent the grantor is not treated as the owner thereof under
sections 671 to 678 of the Internal Revenue Code. The term "grantor type trust" means a
trust where the income or gains of the trust are taxable to the grantor or others treated as
substantial owners under sections 671 to 678 of the Internal Revenue Code.
new text begin
(b)(1) A trust, other than a grantor type trust, that became irrevocable before January
1, 1996, or that was administered in Minnesota before January 1, 1996, is a resident trust
only if two or more of the following conditions are satisfied:
new text end
new text begin
(i) a majority of the discretionary decisions of the trustees relative to the investment
of trust assets are made in Minnesota;
new text end
new text begin
(ii) a majority of the discretionary decisions of the trustees relative to the
distributions of trust income and principal are made in Minnesota;
new text end
new text begin
(iii) the official books and records of the trust, consisting of the original minutes of
trustee meetings and the original trust instruments, are located in Minnesota.
new text end
new text begin
(2) For purposes of this paragraph, if the trustees delegate decisions and actions to an
agent or custodian, the actions and decisions of the agent or custodian must not be taken
into account in determining whether the trust is administered in Minnesota, if:
new text end
new text begin
(i) the delegation was permitted under the trust agreement;
new text end
new text begin
(ii) the trustees retain the power to revoke the delegation on reasonable notice; and
new text end
new text begin
(iii) the trustees monitor and evaluate the performance of the agent or custodian on a
regular basis as is reasonably determined by the trustees.
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. 16.
Minnesota Statutes 2004, section 290.01, subdivision 19a, is amended to read:
Subd. 19a.
Additions to federal taxable income.
For individuals, estates, and
trusts, there shall be added to federal taxable income:
(1)(i) interest income on obligations of any state other than Minnesota or a political
or governmental subdivision, municipality, or governmental agency or instrumentality
of any state other than Minnesota exempt from federal income taxes under the Internal
Revenue Code or any other federal statute; and
(ii) exempt-interest dividends as defined in section 852(b)(5) of the Internal Revenue
Code, except the portion of the exempt-interest dividends derived from interest income
on obligations of the state of Minnesota or its political or governmental subdivisions,
municipalities, governmental agencies or instrumentalities, but only if the portion of the
exempt-interest dividends from such Minnesota sources paid to all shareholders represents
95 percent or more of the exempt-interest dividends that are paid by the regulated
investment company as defined in section 851(a) of the Internal Revenue Code, or the
fund of the regulated investment company as defined in section 851(g) of the Internal
Revenue Code, making the payment; and
(iii) for the purposes of items (i) and (ii), interest on obligations of an Indian tribal
government described in section 7871(c) of the Internal Revenue Code shall be treated as
interest income on obligations of the state in which the tribe is located;
(2) the amount of income taxes paid or accrued within the taxable year under this
chapter and deleted text begin income deleted text end new text begin the amount of new text end taxesnew text begin based on net income new text end paid to any other state or to
any province or territory of Canada, to the extent allowed as a deduction under section
63(d) of the Internal Revenue Code, but the addition may not be more than the amount by
which the itemized deductions as allowed under section 63(d) of the Internal Revenue
Code exceeds the amount of the standard deduction as defined in section 63(c) of the
Internal Revenue Code. For the purpose of this paragraph, the disallowance of itemized
deductions under section 68 of the Internal Revenue Code of 1986, income tax is the last
itemized deduction disallowed;
(3) the capital gain amount of a lump sum distribution to which the special tax under
section 1122(h)(3)(B)(ii) of the Tax Reform Act of 1986, Public Law 99-514, applies;
(4) the amount of income taxes paid or accrued within the taxable year under this
chapter and deleted text begin income deleted text end taxes new text begin based on net income new text end paid to any other state or any province or
territory of Canada, to the extent allowed as a deduction in determining federal adjusted
gross income. For the purpose of this paragraph, income taxes do not include the taxes
imposed by sections 290.0922, subdivision 1, paragraph (b), 290.9727, 290.9728, and
290.9729;
(5) the amount of expense, interest, or taxes disallowed pursuant to section
290.10new text begin other than expenses or interest used in computing net interest income for the
subtraction allowed under subdivision 19b, clause (1)new text end ;
(6) the amount of a partner's pro rata share of net income which does not flow
through to the partner because the partnership elected to pay the tax on the income under
section 6242(a)(2) of the Internal Revenue Code; and
(7) 80 percent of the depreciation deduction allowed under section 168(k) of the
Internal Revenue Code. For purposes of this clause, if the taxpayer has an activity that
in the taxable year generates a deduction for depreciation under section 168(k) and the
activity generates a loss for the taxable year that the taxpayer is not allowed to claim for
the taxable year, "the depreciation allowed under section 168(k)" for the taxable year is
limited to excess of the depreciation claimed by the activity under section 168(k) over the
amount of the loss from the activity that is not allowed in the taxable year. In succeeding
taxable years when the losses not allowed in the taxable year are allowed, the depreciation
under section 168(k) is allowed.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2004.
new text end
Sec. 17.
Minnesota Statutes 2004, section 290.01, subdivision 19b, is amended to read:
Subd. 19b.
Subtractions from federal taxable income.
For individuals, estates,
and trusts, there shall be subtracted from federal taxable income:
(1) new text begin net new text end interest income on obligations of any authority, commission, or
instrumentality of the United States to the extent includable in taxable income for federal
income tax purposes but exempt from state income tax under the laws of the United States;
(2) if included in federal taxable income, the amount of any overpayment of income
tax to Minnesota or to any other state, for any previous taxable year, whether the amount
is received as a refund or as a credit to another taxable year's income tax liability;
(3) the amount paid to others, less the amount used to claim the credit allowed under
section 290.0674, not to exceed $1,625 for each qualifying child in grades kindergarten
to 6 and $2,500 for each qualifying child in grades 7 to 12, for tuition, textbooks, and
transportation of each qualifying child in attending an elementary or secondary school
situated in Minnesota, North Dakota, South Dakota, Iowa, or Wisconsin, wherein a
resident of this state may legally fulfill the state's compulsory attendance laws, which
is not operated for profit, and which adheres to the provisions of the Civil Rights Act
of 1964 and chapter 363A. For the purposes of this clause, "tuition" includes fees or
tuition as defined in section 290.0674, subdivision 1, clause (1). As used in this clause,
"textbooks" includes books and other instructional materials and equipment purchased
or leased for use in elementary and secondary schools in teaching only those subjects
legally and commonly taught in public elementary and secondary schools in this state.
Equipment expenses qualifying for deduction includes expenses as defined and limited in
section 290.0674, subdivision 1, clause (3). "Textbooks" does not include instructional
books and materials used in the teaching of religious tenets, doctrines, or worship, the
purpose of which is to instill such tenets, doctrines, or worship, nor does it include books
or materials for, or transportation to, extracurricular activities including sporting events,
musical or dramatic events, speech activities, driver's education, or similar programs. For
purposes of the subtraction provided by this clause, "qualifying child" has the meaning
given in section 32(c)(3) of the Internal Revenue Code;
(4) income as provided under section 290.0802;
(5) to the extent included in federal adjusted gross income, income realized on
disposition of property exempt from tax under section 290.491;
(6) deleted text begin to the extent included in federal taxable income, postservice benefits for youth
community service under section 124D.42 for volunteer service under United States
Code, title 42, sections 12601 to 12604;
deleted text end
deleted text begin (7) deleted text end to the extent not deducted in determining federal taxable income by an individual
who does not itemize deductions for federal income tax purposes for the taxable year,
an amount equal to 50 percent of the excess of charitable contributions allowable as a
deduction for the taxable year under section 170(a) of the Internal Revenue Code over
$500 ;
deleted text begin (8) deleted text end new text begin (7) new text end for taxable years beginning before January 1, 2008, the amount of the federal
small ethanol producer credit allowed under section 40(a)(3) of the Internal Revenue Code
which is included in gross income under section 87 of the Internal Revenue Code;
deleted text begin (9) deleted text end new text begin (8) new text end for individuals who are allowed a federal foreign tax credit for taxes that do
not qualify for a credit under section 290.06, subdivision 22, an amount equal to the
carryover of subnational foreign taxes for the taxable year, but not to exceed the total
subnational foreign taxes reported in claiming the foreign tax credit. For purposes of
this clause, "federal foreign tax credit" means the credit allowed under section 27 of the
Internal Revenue Code, and "carryover of subnational foreign taxes" equals the carryover
allowed under section 904(c) of the Internal Revenue Code minus national level foreign
taxes to the extent they exceed the federal foreign tax credit;
deleted text begin (10) deleted text end new text begin (9) new text end in each of the five tax years immediately following the tax year in which
an addition is required under subdivision 19a, clause (7), new text begin or 19c, clause (15), in the case
of a shareholder of a corporation that is an S corporation,new text end an amount equal to one-fifth
of the delayed depreciation. For purposes of this clause, "delayed depreciation" means
the amount of the addition made by the taxpayer under subdivision 19a, clause (7), new text begin or
subdivision 19c, clause (15), in the case of a shareholder of an S corporation,new text end minus the
positive value of any net operating loss under section 172 of the Internal Revenue Code
generated for the tax year of the addition. The resulting delayed depreciation cannot be
less than zero; deleted text begin and
deleted text end
deleted text begin (11) deleted text end new text begin (10) new text end job opportunity building zone income as provided under section 469.316deleted text begin .deleted text end new text begin ;
new text end
new text begin
(11) the amount of compensation paid to members of the Minnesota National Guard
or other reserve components of the United States military for active service performed
in Minnesota, excluding compensation for services performed under the Active Guard
Reserve (AGR) program. For purposes of this clause, "active service" means (i) state
active service as defined in section 190.05, subdivision 5a, clause (1); (ii) federally
funded state active service as defined in section 190.05, subdivision 5b; or (iii) federal
active service as defined in section 190.05, subdivision 5c, but "active service" excludes
services performed exclusively for purposes of basic combat training, advanced individual
training, annual training, and periodic inactive duty training; special training periodically
made available to reserve members; and service performed in accordance with section
190.08, subdivision 3;
new text end
new text begin
(12) the amount of compensation paid to members of the armed forces of the United
States or United Nations for active duty performed outside Minnesota; and
new text end
new text begin
(13) to the extent not deducted in computing federal taxable income, an amount, not
to exceed $10,000, equal to qualified expenses related to a qualified donor's donation,
while living, of one or more of the qualified donor's organs to another person for human
organ transplantation. For purposes of determining the extent to which expenses are
deducted in computing federal taxable income, travel and lodging expenses related to an
organ donation are considered deducted by an individual in determining federal taxable
income to the extent they exceed 7.5 percent of federal adjusted gross income as defined
in section 62 of the Internal Revenue Code. For purposes of this clause, "organ" means
all or part of an individual's liver, pancreas, kidney, intestine, lung, or bone marrow;
"human organ transplantation" means the medical procedure by which transfer of a human
organ is made from the body of one person to the body of another person; "qualified
expenses" means unreimbursed expenses for both the individual and the qualified donor
for (i) travel, (ii) lodging, and (iii) lost wages net of sick pay, except that such expenses
may be subtracted under this clause only once; and "qualified donor" means the individual
or the individual's dependent, as defined in section 152 of the Internal Revenue Code. An
individual may claim the subtraction in this clause only once for each instance of organ
donation for transplantation during the taxable year in which the human organ donation
and transplantation occurs.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
The amendment to clause (9) is effective retroactively for tax
years beginning after December 31, 2001. The rest of this section is effective for the tax
years beginning after December 31, 2004.
new text end
Sec. 18.
Minnesota Statutes 2004, section 290.01, subdivision 19c, is amended to read:
Subd. 19c.
Corporations; additions to federal taxable income.
For corporations,
there shall be added to federal taxable income:
(1) the amount of any deduction taken for federal income tax purposes for income,
excise, or franchise taxes based on net income or related minimum taxes, including but not
limited to the tax imposed under section 290.0922, paid by the corporation to Minnesota,
another state, a political subdivision of another state, the District of Columbia, or any
foreign country or possession of the United States;
(2) interest not subject to federal tax upon obligations of: the United States, its
possessions, its agencies, or its instrumentalities; the state of Minnesota or any other
state, any of its political or governmental subdivisions, any of its municipalities, or any
of its governmental agencies or instrumentalities; the District of Columbia; or Indian
tribal governments;
(3) exempt-interest dividends received as defined in section 852(b)(5) of the Internal
Revenue Code;
(4) the amount of any net operating loss deduction taken for federal income tax
purposes under section 172 or 832(c)(10) of the Internal Revenue Code or operations loss
deduction under section 810 of the Internal Revenue Code;
(5) the amount of any special deductions taken for federal income tax purposes
under sections 241 to 247 of the Internal Revenue Code;
(6) losses from the business of mining, as defined in section 290.05, subdivision 1,
clause (a), that are not subject to Minnesota income tax;
(7) the amount of any capital losses deducted for federal income tax purposes under
sections 1211 and 1212 of the Internal Revenue Code;
(8) the exempt foreign trade income of a foreign sales corporation under sections
921(a) and 291 of the Internal Revenue Code;
(9) the amount of percentage depletion deducted under sections 611 through 614 and
291 of the Internal Revenue Code;
(10) for certified pollution control facilities placed in service in a taxable year
beginning before December 31, 1986, and for which amortization deductions were elected
under section 169 of the Internal Revenue Code of 1954, as amended through December
31, 1985, the amount of the amortization deduction allowed in computing federal taxable
income for those facilities;
(11) the amount of any deemed dividend from a foreign operating corporation
determined pursuant to section 290.17, subdivision 4, paragraph (g);
(12) deleted text begin the amount of any environmental tax paid under section 59(a) of the Internal
Revenue Code;
deleted text end
deleted text begin (13) deleted text end the amount of a partner's pro rata share of net income which does not flow
through to the partner because the partnership elected to pay the tax on the income under
section 6242(a)(2) of the Internal Revenue Code;
deleted text begin (14) deleted text end new text begin (13) new text end the amount of net income excluded under section 114 of the Internal
Revenue Code;
deleted text begin (15) deleted text end new text begin (14) new text end any increase in subpart F income, as defined in section 952(a) of the
Internal Revenue Code, for the taxable year when subpart F income is calculated without
regard to the provisions of section 614 of Public Law 107-147; and
deleted text begin (16) deleted text end new text begin (15) new text end 80 percent of the depreciation deduction allowed under section 168(k)
new text begin (1)(A) and (k)(4)(A) new text end of the Internal Revenue Code. For purposes of this clause, if the
taxpayer has an activity that in the taxable year generates a deduction for depreciation
under section 168(k) new text begin (1)(A) and (k)(4)(A) new text end and the activity generates a loss for the taxable
year that the taxpayer is not allowed to claim for the taxable year, "the depreciation
allowed under section 168(k) new text begin (1)(A) and (k)(4)(A) new text end " for the taxable year is limited to
excess of the depreciation claimed by the activity under section 168(k) new text begin (1)(A) and
(k)(4)(A) new text end over the amount of the loss from the activity that is not allowed in the taxable
year. In succeeding taxable years when the losses not allowed in the taxable year are
allowed, the depreciation under section 168(k) new text begin (1)(A) and (k)(4)(A) new text end is allowed.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 19.
Minnesota Statutes 2004, section 290.06, subdivision 22, is amended to read:
Subd. 22.
Credit for taxes paid to another state.
(a) A taxpayer who is liable for
taxes new text begin based new text end on deleted text begin or measured by deleted text end net income to another state, as provided in paragraphs (b)
through (f), upon income allocated or apportioned to Minnesota, is entitled to a credit for
the tax paid to another state if the tax is actually paid in the taxable year or a subsequent
taxable year. A taxpayer who is a resident of this state pursuant to section 290.01,
subdivision 7, deleted text begin clause (2) deleted text end new text begin paragraph (b)new text end , and who is subject to income tax as a resident in
the state of the individual's domicile is not allowed this credit unless the state of domicile
does not allow a similar credit.
(b) For an individual, estate, or trust, the credit is determined by multiplying the tax
payable under this chapter by the ratio derived by dividing the income subject to tax in the
other state that is also subject to tax in Minnesota while a resident of Minnesota by the
taxpayer's federal adjusted gross income, as defined in section 62 of the Internal Revenue
Code, modified by the addition required by section 290.01, subdivision 19a, clause (1),
and the subtraction allowed by section 290.01, subdivision 19b, clause (1), to the extent
the income is allocated or assigned to Minnesota under sections 290.081 and 290.17.
(c) If the taxpayer is an athletic team that apportions all of its income under section
290.17, subdivision 5, the credit is determined by multiplying the tax payable under this
chapter by the ratio derived from dividing the total net income subject to tax in the other
state by the taxpayer's Minnesota taxable income.
(d) The credit determined under paragraph (b) or (c) shall not exceed the amount of
tax so paid to the other state on the gross income earned within the other state subject to
tax under this chapter, nor shall the allowance of the credit reduce the taxes paid under
this chapter to an amount less than what would be assessed if such income amount was
excluded from taxable net income.
(e) In the case of the tax assessed on a lump sum distribution under section 290.032,
the credit allowed under paragraph (a) is the tax assessed by the other state on the lump
sum distribution that is also subject to tax under section 290.032, and shall not exceed the
tax assessed under section 290.032. To the extent the total lump sum distribution defined
in section 290.032, subdivision 1, includes lump sum distributions received in prior years
or is all or in part an annuity contract, the reduction to the tax on the lump sum distribution
allowed under section 290.032, subdivision 2, includes tax paid to another state that is
properly apportioned to that distribution.
(f) If a Minnesota resident reported an item of income to Minnesota and is assessed
tax in such other state on that same income after the Minnesota statute of limitations
has expired, the taxpayer shall receive a credit for that year under paragraph (a),
notwithstanding any statute of limitations to the contrary. The claim for the credit must
be submitted within one year from the date the taxes were paid to the other state. The
taxpayer must submit sufficient proof to show entitlement to a credit.
(g) For the purposes of this subdivision, a resident shareholder of a corporation
treated as an "S" corporation under section 290.9725, must be considered to have paid
a tax imposed on the shareholder in an amount equal to the shareholder's pro rata share
of any net income tax paid by the S corporation to another state. For the purposes of the
preceding sentence, the term "net income tax" means any tax imposed on or measured by
a corporation's net income.
(h) For the purposes of this subdivision, a resident partner of an entity taxed as
a partnership under the Internal Revenue Code must be considered to have paid a tax
imposed on the partner in an amount equal to the partner's pro rata share of any net income
tax paid by the partnership to another state. For purposes of the preceding sentence,
the term "net income" tax means any tax imposed on or measured by a partnership's
net income.
(i) For the purposes of this subdivision, "another state":
(1) includes:
(i) the District of Columbia; and
(ii) a province or territory of Canada; but
(2) excludes Puerto Rico and the several territories organized by Congress.
(j) The limitations on the credit in paragraphs (b), (c), and (d), are imposed on a
state by state basis.
(k) For a tax imposed by a province or territory of Canada, the tax for purposes of
this subdivision is the excess of the tax over the amount of the foreign tax credit allowed
under section 27 of the Internal Revenue Code. In determining the amount of the foreign
tax credit allowed, the net income taxes imposed by Canada on the income are deducted
first. Any remaining amount of the allowable foreign tax credit reduces the provincial or
territorial tax that qualifies for the credit under this subdivision.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2004.
new text end
Sec. 20.
Minnesota Statutes 2004, section 290.06, is amended by adding a subdivision
to read:
new text begin Subd. 32. new text end
new text begin Dairy investment credit. new text end
new text begin
(a) A dairy investment credit is allowed against
the tax computed under this chapter equal to the credit amount in the table, based on the
amount paid or incurred by the taxpayer in the tax year and certified by the commissioner
of agriculture under paragraph (f), for qualifying expenditures:
new text end
new text begin
Amount of qualifying expenditures
new text end
new text begin
Credit amount
new text end
new text begin
up to $500,000
new text end
new text begin
ten percent of qualifying expenditures
new text end
new text begin
over $500,000, but not
new text end
new text begin
$50,000, plus nine percent more than $600,000
new text end
new text begin
of the amount
of qualified expenditures in excess of $500,000
new text end
new text begin
over $600,000, but not
new text end
new text begin
$59,000, plus seven percent more than $700,000
new text end
new text begin
of the
amount of qualified expenditures in excess of $600,000
new text end
new text begin
over $700,000, but not
new text end
new text begin
$66,000, plus five percent more than $800,000
new text end
new text begin
of the amount
of qualified expenditures in excess of $700,000
new text end
new text begin
over $800,000, but not
new text end
new text begin
$71,000, plus three percent more than $900,000
new text end
new text begin
of the
amount of qualified expenditures in excess of $800,000
new text end
new text begin
over $900,000, but not
new text end
new text begin
$74,000, plus one percent more than $1,000,000
new text end
new text begin
of the
amount of qualified expenditures in excess of $900,000
new text end
new text begin
$1,000,000 or more
new text end
new text begin
$75,000
new text end
new text begin
(b) "Qualifying expenditures," for purposes of this subdivision, means the expenses
incurred for dairy animals for the construction or improvement of buildings or facilities,
or the acquisition of equipment, for dairy animal housing, confinement, animal feeding,
milk production, and waste management, including, but not limited to, the following:
new text end
new text begin
(1) freestall barns;
new text end
new text begin
(2) fences;
new text end
new text begin
(3) watering facilities;
new text end
new text begin
(4) feed storage and handling equipment;
new text end
new text begin
(5) milking parlors;
new text end
new text begin
(6) robotic equipment;
new text end
new text begin
(7) scales;
new text end
new text begin
(8) milk storage and cooling facilities;
new text end
new text begin
(9) bulk tanks;
new text end
new text begin
(10) manure handling equipment and storage facilities;
new text end
new text begin
(11) digesters;
new text end
new text begin
(12) equipment used to produce energy;
new text end
new text begin
(13) on-farm processing; and
new text end
new text begin
(14) development of pasture other than land acquisition.
new text end
new text begin
Qualifying expenditures only include amounts that are capitalized and deducted under
either section 167 or 179 of the Internal Revenue Code in computing federal taxable
income.
new text end
new text begin
(c) The credit is limited to the liability for tax, as computed under this section for
the taxable year for which the credit certificate is issued. If the amount of the credit
determined under this section for any taxable year exceeds this limitation, the excess is a
dairy investment credit carryover to each of the 15 succeeding taxable years. The entire
amount of the excess unused credit for the taxable year is carried first to the earliest of the
taxable years to which the credit may be carried and then to each successive year to which
the credit may be carried. The amount of the unused credit which may be added under
this paragraph shall not exceed the taxpayer's liability for tax less the dairy investment
credit for the taxable year.
new text end
new text begin
(d) For a partnership or S corporation, the maximum amount of the credit applies to
the entity, not the individual partner or shareholder.
new text end
new text begin
(e) To be eligible for the dairy investment credit in this subdivision, a taxpayer must
apply to the commissioner of agriculture for a tax credit certificate. The application must
be made on forms prescribed by the commissioner of agriculture and must include a
statement of the qualifying expenditures by the taxpayer.
new text end
new text begin
(f) The commissioner of agriculture shall certify credits in the order the forms
required under paragraph (e) are received and approved by the commissioner of
agriculture, until the maximum credit amount for the taxable year has been reached.
The maximum credit amount is $900,000 for tax years beginning after December 31,
2004, and before January 1, 2006; and $1,000,000 per year for tax years beginning after
December 31, 2005.
new text end
new text begin
Any eligible applications for which certificates are not issued in a tax year because
the commissioner of agriculture has issued certificates totaling the maximum credit
amount for that tax year remain eligible for a credit certificate in subsequent tax years, in
the order in which the forms were received by the commissioner of agriculture.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for assets placed in service in taxable
years beginning after December 31, 2004.
new text end
Sec. 21.
Minnesota Statutes 2004, section 290.067, subdivision 1, is amended to read:
Subdivision 1.
Amount of credit.
(a) A taxpayer may take as a credit against the
tax due from the taxpayer and a spouse, if any, under this chapter an amount equal to the
dependent care credit for which the taxpayer is eligible pursuant to the provisions of
section 21 of the Internal Revenue Code subject to the limitations provided in subdivision
2 except that in determining whether the child qualified as a dependent, income received
as a Minnesota family investment program grant or allowance to or on behalf of the child
must not be taken into account in determining whether the child received more than half
of the child's support from the taxpayer, and the provisions of section 32(b)(1)(D) of
the Internal Revenue Code do not apply.
(b) If a child who has not attained the age of six years at the close of the taxable year
is cared for at a licensed family day care home operated by the child's parent, the taxpayer
is deemed to have paid employment-related expenses. If the child is 16 months old or
younger at the close of the taxable year, the amount of expenses deemed to have been paid
equals the maximum limit for one qualified individual under section 21(c) and (d) of the
Internal Revenue Code. If the child is older than 16 months of age but has not attained the
age of six years at the close of the taxable year, the amount of expenses deemed to have
been paid equals the amount the licensee would charge for the care of a child of the same
age for the same number of hours of care.
(c) If a married couple:
(1) has a child who has not attained the age of one year at the close of the taxable
year;
(2) files a joint tax return for the taxable year; and
(3) does not participate in a dependent care assistance program as defined in section
129 of the Internal Revenue Code, in lieu of the actual employment related expenses paid
for that child under paragraph (a) or the deemed amount under paragraph (b), the lesser of
(i) the combined earned income of the couple or (ii) the amount of the maximum limit for
one qualified individual under section 21(c) and (d) of the Internal Revenue Code will
be deemed to be the employment related expense paid for that child. The earned income
limitation of section 21(d) of the Internal Revenue Code shall not apply to this deemed
amount. These deemed amounts apply regardless of whether any employment-related
expenses have been paid.
(d) If the taxpayer is not required and does not file a federal individual income tax
return for the tax year, no credit is allowed for any amount paid to any person unless:
(1) the name, address, and taxpayer identification number of the person are included
on the return claiming the credit; or
(2) if the person is an organization described in section 501(c)(3) of the Internal
Revenue Code and exempt from tax under section 501(a) of the Internal Revenue Code,
the name and address of the person are included on the return claiming the credit.
In the case of a failure to provide the information required under the preceding sentence,
the preceding sentence does not apply if it is shown that the taxpayer exercised due
diligence in attempting to provide the information required.
In the case of a nonresident, part-year resident, or a person who has earned income
not subject to tax under this chapter including earned income excluded pursuant to section
290.01, subdivision 19b, clause (11), the credit determined under section 21 of the Internal
Revenue Code must be allocated based on the ratio by which the earned income of the
claimant and the claimant's spouse from Minnesota sources bears to the total earned
income of the claimant and the claimant's spouse.
new text begin
For residents of Minnesota, the subtractions for military pay under section 290.01,
subdivision 19b, clauses (11) and (12), are not considered "earned income not subject to
tax under this chapter."
new text end
Sec. 22.
Minnesota Statutes 2004, section 290.067, subdivision 2a, is amended to read:
Subd. 2a.
Income.
(a) For purposes of this section, "income" means the sum of
the following:
(1) federal adjusted gross income as defined in section 62 of the Internal Revenue
Code; deleted text begin and deleted text end new text begin plus
new text end
(2) the sum of the following amounts to the extent not included in clause (1):
(i) all nontaxable income;
(ii) the amount of a passive activity loss that is not disallowed as a result of section
469, paragraph (i) or (m) of the Internal Revenue Code and the amount of passive activity
loss carryover allowed under section 469(b) of the Internal Revenue Code;
(iii) an amount equal to the total of any discharge of qualified farm indebtedness
of a solvent individual excluded from gross income under section 108(g) of the Internal
Revenue Code;
(iv) cash public assistance and relief;
(v) any pension or annuity (including railroad retirement benefits, all payments
received under the federal Social Security Act, supplemental security income, and veterans
benefits), which was not exclusively funded by the claimant or spouse, or which was
funded exclusively by the claimant or spouse and which funding payments were excluded
from federal adjusted gross income in the years when the payments were made;
(vi) interest received from the federal or a state government or any instrumentality
or political subdivision thereof;
(vii) workers' compensation;
(viii) nontaxable strike benefits;
(ix) the gross amounts of payments received in the nature of disability income or
sick pay as a result of accident, sickness, or other disability, whether funded through
insurance or otherwise;
(x) a lump sum distribution under section 402(e)(3) of the Internal Revenue Code;
(xi) contributions made by the claimant to an individual retirement account,
including a qualified voluntary employee contribution; simplified employee pension plan;
self-employed retirement plan; cash or deferred arrangement plan under section 401(k)
of the Internal Revenue Code; or deferred compensation plan under section 457 of the
Internal Revenue Code; and
(xii) nontaxable scholarship or fellowship grantsnew text begin ; minus
new text end
new text begin (3) in the case of a married couple filing a joint return, the earned income of the
lesser-earning spouse, as defined in section 290.0675, subdivision 1, paragraph (d)new text end .
In the case of an individual who files an income tax return on a fiscal year basis, the
term "federal adjusted gross income" means federal adjusted gross income reflected in the
fiscal year ending in the next calendar year. Federal adjusted gross income may not be
reduced by the amount of a net operating loss carryback or carryforward or a capital loss
carryback or carryforward allowed for the year.
(b) "Income" does not include:
(1) amounts excluded pursuant to the Internal Revenue Code, sections 101(a) and
102;
(2) amounts of any pension or annuity that were exclusively funded by the claimant
or spouse if the funding payments were not excluded from federal adjusted gross income
in the years when the payments were made;
(3) surplus food or other relief in kind supplied by a governmental agency;
(4) relief granted under chapter 290A;
(5) child support payments received under a temporary or final decree of dissolution
or legal separation; and
(6) restitution payments received by eligible individuals and excludable interest as
defined in section 803 of the Economic Growth and Tax Relief Reconciliation Act of
2001, Public Law 107-16.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxable years beginning after
December 31, 2005.
new text end
Sec. 23.
Minnesota Statutes 2004, section 290.0671, subdivision 1, is amended to read:
Subdivision 1.
Credit allowed.
(a) An individual is allowed a credit against the
tax imposed by this chapter equal to a percentage of earned income. To receive a credit,
a taxpayer must be eligible for a credit under section 32 of the Internal Revenue Code.
new text begin An individual who would have been eligible for a credit under section 32 of the Internal
Revenue Code if the phaseout in section 32(b) were calculated based on the income
thresholds provided in paragraphs (b) through (d) as adjusted in paragraphs (i) through (k)
is also eligible for a credit under this section.
new text end
(b) For individuals with no qualifying children, the credit equals 1.9125 percent of
the first $4,620 of earned income. The credit is reduced by 1.9125 percent of earned
income or deleted text begin modified deleted text end adjusted gross income, whichever is greater, in excess of $5,770,
but in no case is the credit less than zero.
(c) For individuals with one qualifying child, the credit equals 8.5 percent of the first
$6,920 of earned income and 8.5 percent of earned income over $12,080 but less than
$13,450. The credit is reduced by 5.73 percent of earned income ordeleted text begin modified deleted text end adjusted
gross income, whichever is greater, in excess of $15,080, but in no case is the credit
less than zero.
(d) For individuals with two or more qualifying children, the credit equals ten
percent of the first $9,720 of earned income and 20 percent of earned income over
$14,860 but less than $16,800. The credit is reduced by 10.3 percent of earned income
or deleted text begin modified deleted text end adjusted gross income, whichever is greater, in excess of $17,890, but in no
case is the credit less than zero.
(e) For a nonresident or part-year resident, the credit must be allocated based on the
percentage calculated under section 290.06, subdivision 2c, paragraph (e).
(f) For a person who was a resident for the entire tax year and has earned income
not subject to tax under this chapter, including income excluded under section 290.01,
subdivision 19b, clause (11), the credit must be allocated based on the ratio of federal
adjusted gross income reduced by the earned income not subject to tax under this chapter
over federal adjusted gross income. new text begin For purposes of this paragraph, the subtractions
for military pay under section 290.01, subdivision 19b, clauses (11) and (12), are not
considered "earned income not subject to tax under this chapter."
new text end
(g) For tax years beginning after December 31, 2001, and before December 31,
2004, the $5,770 in paragraph (b), the $15,080 in paragraph (c), and the $17,890 in
paragraph (d), after being adjusted for inflation under subdivision 7, are each increased by
$1,000 for married taxpayers filing joint returns.
(h) For tax years beginning after December 31, 2004, and before December 31,
deleted text begin 2007 deleted text end new text begin 2005new text end , the $5,770 in paragraph (b), the $15,080 in paragraph (c), and the $17,890 in
paragraph (d), after being adjusted for inflation under subdivision 7, are each increased by
$2,000 for married taxpayers filing joint returns.
new text begin
(i) For tax years beginning after December 31, 2005, and before December 31, 2007,
the $5,770 in paragraph (b), the $15,080 in paragraph (c), and the $17,890 in paragraph
(d), after being adjusted for inflation under subdivision 7, are each increased by the greater
of (i) $2,000 or (ii) the earned income of the lesser-earning spouse, for married taxpayers
filing joint returns.
new text end
deleted text begin (i) deleted text end new text begin (j) new text end For tax years beginning after December 31, 2007, and before December 31,
2010, the $5,770 in paragraph (b), the $15,080 in paragraph (c), and the $17,890 in
paragraph (d), after being adjusted for inflation under subdivision 7, are each increased by
deleted text begin $3,000 deleted text end new text begin the greater of (i) $3,000 or (ii) the earned income of the lesser-earning spouse,new text end for
married taxpayers filing joint returns. For tax years beginning after December 31,
2008, new text begin and before December 31, 2010,new text end the $3,000 is adjusted annually for inflation under
subdivision 7.
new text begin
(k) For tax years beginning after December 31, 2010, the $5,770 in paragraph (b),
the $15,080 in paragraph (c), and the $17,890 in paragraph (d), after being adjusted for
inflation under subdivision 7, are each increased by the earned income of the lesser-earning
spouse, for married taxpayers filing joint returns.
new text end
deleted text begin (j) deleted text end new text begin (l) new text end The commissioner shall construct tables showing the amount of the credit at
various income levels and make them available to taxpayers. The tables shall follow
the schedule contained in this subdivision, except that the commissioner may graduate
the transition between income brackets.
Sec. 24.
Minnesota Statutes 2004, section 290.0671, subdivision 1a, is amended to
read:
Subd. 1a.
Definitions.
For purposes of this section, the terms "qualifying child," new text begin and
new text end "earned income," deleted text begin and "adjusted gross income" deleted text end have the meanings given in section 32(c) of
the Internal Revenue Codenew text begin , and the term "adjusted gross income" has the meaning given
in section 62 of the Internal Revenue Codenew text end .
new text begin
"Earned income of the lesser-earning spouse" has the meaning given in section
290.0675, subdivision 1, paragraph (d).
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxable years beginning after
December 31, 2004.
new text end
Sec. 25.
Minnesota Statutes 2004, section 290.0672, subdivision 1, is amended to read:
Subdivision 1.
Definitions.
(a) For purposes of this section, the following terms
have the meanings given.
(b) "Long-term care insurance" means a policy that:
(1) qualifies for a deduction under section 213 of the Internal Revenue Code,
disregarding the 7.5 percent income test; or meets the requirements given in section
62A.46; or provides similar coverage issued under the laws of another jurisdiction; and
(2) has a lifetime long-term care benefit limit of not less than $100,000; and
(3) has been offered in compliance with the inflation protection requirements of
section 62S.23.
(c) "Qualified beneficiary" means the taxpayer or the taxpayer's spouse.
deleted text begin
(d) "Premiums deducted in determining federal taxable income" means the lesser of
(1) long-term care insurance premiums that qualify as deductions under section 213 of
the Internal Revenue Code; and (2) the total amount deductible for medical care under
section 213 of the Internal Revenue Code.
deleted text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2004.
new text end
Sec. 26.
Minnesota Statutes 2004, section 290.0672, subdivision 2, is amended to read:
Subd. 2.
Credit.
A taxpayer is allowed a credit against the tax imposed by this
chapter for long-term care insurance policy premiums paid during the tax year. The
credit for each policy equals 25 percent of premiums paid deleted text begin to the extent not deducted in
determining federal taxable incomedeleted text end . A taxpayer may claim a credit for only one policy
for each qualified beneficiary. A maximum of $100 applies to each qualified beneficiary.
The maximum total credit allowed per year is $200 for married couples filing joint returns
and $100 for all other filers. For a nonresident or part-year resident, the credit determined
under this section must be allocated based on the percentage calculated under section
290.06, subdivision 2c, paragraph (e).
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2004.
new text end
Sec. 27.
Minnesota Statutes 2004, section 290.0674, subdivision 1, is amended to read:
Subdivision 1.
Credit allowed.
An individual is allowed a credit against the
tax imposed by this chapter in an amount equal to 75 percent of the amount paid for
education-related expenses for a qualifying child in kindergarten through grade 12. For
purposes of this section, "education-related expenses" means:
(1) fees or tuition for instruction by an instructor under section 120A.22, subdivision
10, clause (1), (2), (3), (4), or (5), or a member of the Minnesota Music Teachers
Association, and who is not a lineal ancestor or sibling of the dependent for instruction
outside the regular school day or school year, including tutoring, driver's education
offered as part of school curriculum, regardless of whether it is taken from a public or
private entity or summer camps, in grade or age appropriate curricula that supplement
curricula and instruction available during the regular school year, that assists a dependent
to improve knowledge of core curriculum areas or to expand knowledge and skills under
the deleted text begin graduation rule under section 120B.02, paragraph (e), clauses (1) to (7), (9), and (10)
deleted text end new text begin required academic standards under section 120B.021, subdivision 1, and the elective
standard under section 120B.022, subdivision 1, clause (2)new text end , and that do not include the
teaching of religious tenets, doctrines, or worship, the purpose of which is to instill such
tenets, doctrines, or worship;
(2) expenses for textbooks, including books and other instructional materials and
equipment purchased or leased for use in elementary and secondary schools in teaching
only those subjects legally and commonly taught in public elementary and secondary
schools in this state. "Textbooks" does not include instructional books and materials
used in the teaching of religious tenets, doctrines, or worship, the purpose of which is
to instill such tenets, doctrines, or worship, nor does it include books or materials for
extracurricular activities including sporting events, musical or dramatic events, speech
activities, driver's education, or similar programs;
(3) a maximum expense of $200 per family for personal computer hardware,
excluding single purpose processors, and educational software that assists a dependent to
improve knowledge of core curriculum areas or to expand knowledge and skills under
the deleted text begin graduation rule under section 120B.02 deleted text end new text begin required academic standards under section
120B.021, subdivision 1, and the elective standard under section 120B.022, subdivision 1,
clause (2),new text end purchased for use in the taxpayer's home and not used in a trade or business
regardless of whether the computer is required by the dependent's school; and
(4) the amount paid to others for transportation of a qualifying child attending an
elementary or secondary school situated in Minnesota, North Dakota, South Dakota, Iowa,
or Wisconsin, wherein a resident of this state may legally fulfill the state's compulsory
attendance laws, which is not operated for profit, and which adheres to the provisions of
the Civil Rights Act of 1964 and chapter 363A.
For purposes of this section, "qualifying child" has the meaning given in section
32(c)(3) of the Internal Revenue Code.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2004.
new text end
Sec. 28.
Minnesota Statutes 2004, section 290.0674, subdivision 2, is amended to read:
Subd. 2.
Limitations.
(a) new text begin For taxable years beginning after December 31, 2004,
and before January 1, 2006,new text end for claimants with income not greater than $33,500, the
maximum credit allowed new text begin for a family new text end is $1,000 deleted text begin per qualifying child and $2,000 per family
deleted text end new text begin multiplied by the number of qualifying children in kindergarten through grade 12 in the
familynew text end . deleted text begin No credit is allowed for education-related expenses for claimants with income
greater than $37,500.deleted text end The maximum credit deleted text begin per child deleted text end new text begin for families with one qualifying child
in kindergarten through grade 12 new text end is reduced by $1 for each $4 of household income over
$33,500, and the maximum credit deleted text begin per family deleted text end new text begin for families with two or more qualifying
children in kindergarten through grade 12 new text end is reduced by $2 for each $4 of household
income over $33,500, but in no case is the credit less than zero.
new text begin
(b) For taxable years beginning after December 31, 2005, for claimants with income
not greater than the greater of (i) $33,500 or (ii) 185 percent of the federal poverty
guidelines, the maximum credit allowed for a family is $1,000 multiplied by the number
of qualifying children in the family in grades kindergarten through 12. The maximum
credit per family is reduced by $1 multiplied by the number of qualifying children in
the family in grades kindergarten through 12 for each $4 of household income over the
greater of (i) $33,500 or (ii) 185 percent of the federal poverty guidelines, but in no case is
the credit less than zero.
new text end
new text begin (c) new text end For purposes of this section "income" has the meaning given in section 290.067,
subdivision 2anew text begin , but disregarding the subtraction in clause (3)new text end . In the case of a married
claimant, a credit is not allowed unless a joint income tax return is filednew text begin . For purposes of
this section "federal poverty guidelines" means the guidelines published in the Federal
Register in the tax year for which the credit is claimed, adjusted for family sizenew text end .
deleted text begin (b) deleted text end new text begin (d) new text end For a nonresident or part-year resident, the credit determined under
subdivision 1 and the maximum credit amount in paragraph (a) must be allocated using
the percentage calculated in section 290.06, subdivision 2c, paragraph (e).
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxable years beginning after
December 31, 2004.
new text end
Sec. 29.
Minnesota Statutes 2004, section 290.091, subdivision 2, is amended to read:
Subd. 2.
Definitions.
For purposes of the tax imposed by this section, the following
terms have the meanings given:
(a) "Alternative minimum taxable income" means the sum of the following for
the taxable year:
(1) the taxpayer's federal alternative minimum taxable income as defined in section
55(b)(2) of the Internal Revenue Code;
(2) the taxpayer's itemized deductions allowed in computing federal alternative
minimum taxable income, but excluding:
(i) the charitable contribution deduction under section 170 of the Internal Revenue
Codenew text begin :
new text end
new text begin (A) for taxable years beginning before January 1, 2006,new text end to the extent that the
deduction exceeds 1.0 percent of adjusted gross incomedeleted text begin , as defined deleted text end new text begin ;
new text end
new text begin
(B) for taxable years beginning after December 31, 2005, to the full extent of the
deduction.
new text end
new text begin For purposes of this clause, "adjusted gross income" has the meaning given new text end in
section 62 of the Internal Revenue Code;
(ii) the medical expense deduction;
(iii) the casualty, theft, and disaster loss deduction; and
(iv) the impairment-related work expenses of a disabled person;
(3) for depletion allowances computed under section 613A(c) of the Internal
Revenue Code, with respect to each property (as defined in section 614 of the Internal
Revenue Code), to the extent not included in federal alternative minimum taxable income,
the excess of the deduction for depletion allowable under section 611 of the Internal
Revenue Code for the taxable year over the adjusted basis of the property at the end of the
taxable year (determined without regard to the depletion deduction for the taxable year);
(4) to the extent not included in federal alternative minimum taxable income, the
amount of the tax preference for intangible drilling cost under section 57(a)(2) of the
Internal Revenue Code determined without regard to subparagraph (E);
(5) to the extent not included in federal alternative minimum taxable income, the
amount of interest income as provided by section 290.01, subdivision 19a, clause (1); and
(6) the amount of addition required by section 290.01, subdivision 19a, clause (7);
less the sum of the amounts determined under the following:
(1) interest income as defined in section 290.01, subdivision 19b, clause (1);
(2) an overpayment of state income tax as provided by section 290.01, subdivision
19b, clause (2), to the extent included in federal alternative minimum taxable income;
(3) the amount of investment interest paid or accrued within the taxable year on
indebtedness to the extent that the amount does not exceed net investment income, as
defined in section 163(d)(4) of the Internal Revenue Code. Interest does not include
amounts deducted in computing federal adjusted gross income; and
(4) amounts subtracted from federal taxable income as provided by section 290.01,
subdivision 19b, clauses deleted text begin (10) and (11) deleted text end new text begin (9) to (13)new text end .
In the case of an estate or trust, alternative minimum taxable income must be
computed as provided in section 59(c) of the Internal Revenue Code.
(b) "Investment interest" means investment interest as defined in section 163(d)(3)
of the Internal Revenue Code.
(c) "Tentative minimum tax" equals 6.4 percent of alternative minimum taxable
income after subtracting the exemption amount determined under subdivision 3.
(d) "Regular tax" means the tax that would be imposed under this chapter (without
regard to this section and section 290.032), reduced by the sum of the nonrefundable
credits allowed under this chapter.
(e) "Net minimum tax" means the minimum tax imposed by this section.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxable years beginning after
December 31, 2004.
new text end
Sec. 30.
Minnesota Statutes 2004, section 290.091, subdivision 3, is amended to read:
Subd. 3.
Exemption amount.
new text begin (a) new text end For purposes of computing the alternative
minimum tax, the exemption amount isnew text begin :
new text end
new text begin (1) for taxable years beginning before January 1, 2005,new text end the exemption determined
under section 55(d) of the Internal Revenue Code, as amended through December 31,
1992new text begin ;
new text end
new text begin
(2) for taxable years beginning after December 31, 2004, and before January 1,
2006, $42,000 for married couples filing joint returns; $21,000 for married individuals
filing separate returns, estates, and trusts; and $31,500 for unmarried individuals;
new text end
new text begin
(3) for taxable years beginning after December 31, 2005, and before January 1,
2007, $45,000 for married couples filing joint returns; $22,500 for married individuals
filing separate returns, estates, and trusts; and $33,750 for unmarried individuals; and
new text end
new text begin
(4) for taxable years beginning after December 31, 2006, and before January 1,
2008, $50,000 for married couples filing joint returns; $25,000 for married individuals
filing separate returns, estates, and trusts; and $37,500 for unmarried individuals.
new text end
new text begin (b) The exemption amount determined under this subdivision is subject to the phase
out under section 55(d)(3) of the Internal Revenue Codenew text end , except that alternative minimum
taxable income as determined under this section must be substituted in the computation
of the phase out deleted text begin under section 55(d)(3)deleted text end .
new text begin
(c) For taxable years beginning after December 31, 2007, the exemption amount
under paragraph (a), clause (4), must be adjusted for inflation. The commissioner shall
make the inflation adjustments in accordance with section 1(f) of the Internal Revenue
Code except that for the purposes of this subdivision the percentage increase must be
determined from the year starting September 1, 2006, and ending August 31, 2007, as the
base year for adjusting for inflation for the tax year beginning after December 31, 2007.
The determination of the commissioner under this subdivision is not a rule under the
Administrative Procedure Act.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxable years beginning after
December 31, 2004.
new text end
Sec. 31.
Minnesota Statutes 2004, section 290.0922, subdivision 2, is amended to read:
Subd. 2.
Exemptions.
The following entities are exempt from the tax imposed
by this section:
(1) corporations exempt from tax under section 290.05;
(2) real estate investment trusts;
(3) regulated investment companies or a fund thereof; and
(4) entities having a valid election in effect under section 860D(b) of the Internal
Revenue Code;
(5) town and farmers' mutual insurance companies;
(6) cooperatives organized under chapter 308A new text begin or 308B new text end that provide housing
exclusively to persons age 55 and over and are classified as homesteads under section
273.124, subdivision 3; and
(7) an entity, if for the taxable year all of its property is located in a job opportunity
building zone designated under section 469.314 and all of its payroll is a job opportunity
building zone payroll under section 469.310.
Entities not specifically exempted by this subdivision are subject to tax under this
section, notwithstanding section 290.05.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2004.
new text end
Sec. 32.
Minnesota Statutes 2004, section 290.191, subdivision 2, is amended to read:
Subd. 2.
Apportionment formula of general application.
new text begin (a) new text end Except for those
trades or businesses required to use a different formula under subdivision 3 or section
290.36, and for those trades or businesses that receive permission to use some other
method under section 290.20 or under subdivision 4, a trade or business required to
apportion its net income must apportion its income to this state on the basis of the
percentage obtained by taking the sum of:
(1) deleted text begin 75 deleted text end new text begin the new text end percent new text begin for the sales factor under paragraph (b) new text end of the percentage which
the sales made within this state in connection with the trade or business during the tax
period are of the total sales wherever made in connection with the trade or business during
the tax period;
(2) deleted text begin 12.5 deleted text end new text begin the new text end percent new text begin for the property factor under paragraph (b) new text end of the percentage
which the total tangible property used by the taxpayer in this state in connection with the
trade or business during the tax period is of the total tangible property, wherever located,
used by the taxpayer in connection with the trade or business during the tax period; and
(3) deleted text begin 12.5 deleted text end new text begin the new text end percent new text begin for the payroll factor under paragraph (b) new text end of the percentage
which the taxpayer's total payrolls paid or incurred in this state or paid in respect to labor
performed in this state in connection with the trade or business during the tax period are
of the taxpayer's total payrolls paid or incurred in connection with the trade or business
during the tax period.
new text begin
(b) For purposes of paragraph (a) and subdivision 3, the following percentages apply
for the taxable years specified:
new text end
new text begin
Taxable years
new text end
new text begin
Sales factor
new text end
new text begin
Property
new text end
new text begin
Payroll beginning
new text end
new text begin
percent
new text end
new text begin
factor
new text end
new text begin
factor during
calendar
new text end
new text begin
percent
new text end
new text begin
percent year 2007
new text end
new text begin
78
new text end
new text begin
11
new text end
new text begin
11 2008
new text end
new text begin
95
new text end
new text begin
2.5
new text end
new text begin
2.5 2009 and later
new text end
new text begin
100
new text end
new text begin
0
new text end
new text begin
0
calendar years
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2006.
new text end
Sec. 33.
Minnesota Statutes 2004, section 290.191, subdivision 3, is amended to read:
Subd. 3.
Apportionment formula for financial institutions.
Except for an
investment company required to apportion its income under section 290.36, a financial
institution that is required to apportion its net income must apportion its net income to this
state on the basis of the percentage obtained by taking the sum of:
(1) deleted text begin 75 deleted text end new text begin the new text end percent new text begin for the sales factor under subdivision 2, paragraph (b),new text end of the
percentage which the receipts from within this state in connection with the trade or
business during the tax period are of the total receipts in connection with the trade or
business during the tax period, from wherever derived;
(2) deleted text begin 12.5 deleted text end new text begin the new text end percent new text begin for the property factor under subdivision 2, paragraph (b),new text end of
the percentage which the sum of the total tangible property used by the taxpayer in this
state and the intangible property owned by the taxpayer and attributed to this state in
connection with the trade or business during the tax period is of the sum of the total
tangible property, wherever located, used by the taxpayer and the intangible property
owned by the taxpayer and attributed to all states in connection with the trade or business
during the tax period; and
(3) deleted text begin 12.5 deleted text end new text begin the new text end percent new text begin for the payroll factor under subdivision 2, paragraph (b),new text end of the
percentage which the taxpayer's total payrolls paid or incurred in this state or paid in
respect to labor performed in this state in connection with the trade or business during
the tax period are of the taxpayer's total payrolls paid or incurred in connection with
the trade or business during the tax period.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2006.
new text end
Sec. 34.
new text begin
[290.433] NATIONAL GUARD AND RESERVES CHECKOFF.
new text end
new text begin Subdivision 1. new text end
new text begin Checkoff established. new text end
new text begin
(a) Every individual who files an income tax
return may designate on their original return that $1 or more shall be added to the tax or
deducted from the refund that would otherwise be payable by or to that individual and
paid into a Minnesota military families relief account established in the special revenue
fund. The commissioner of revenue shall, on the income tax return, notify filers of their
right to designate that a portion of their tax or refund shall be paid into the Minnesota
military families relief account. Amounts so designated to be paid shall be credited to the
account as returns are processed, in as timely a manner as practical. All interest earned on
money accrued, gifts to the program, contributions to the program, and reimbursements of
expenditures shall be credited to the account. All money in the account is appropriated
to the adjutant general of the Department of Military Affairs for the purpose of making
grants as specified in subdivision 2.
new text end
new text begin
(b) The checkoff under this section is subject to removal from the income tax return
as provided in section 290.439, subdivision 2.
new text end
new text begin Subd. 2. new text end
new text begin Grants. new text end
new text begin
(a) The adjutant general is authorized to expend any money
appropriated from the Minnesota military families relief account in the special revenue
fund for the purpose of making grants:
new text end
new text begin
(1) directly to eligible individuals; or
new text end
new text begin
(2) to one or more eligible foundations for the purpose of making grants to eligible
individuals, as provided in this section.
new text end
new text begin
(b) The term, "eligible individual" includes any Minnesota resident who is:
new text end
new text begin
(1) a member of the Minnesota National Guard or other United States armed forces
reserves who has been ordered to federal active service since September 11, 2001, and has
a financial need as a result of that service;
new text end
new text begin
(2) the spouse or dependent child of a person described in clause (1); or
new text end
new text begin
(3) the surviving spouse or surviving dependent child of a person described in
clause (1).
new text end
new text begin
To be an eligible individual, a person described in clause (2) or (3) must be residing
within the state of Minnesota.
new text end
new text begin
(c) The term "eligible foundation" includes any organization that:
new text end
new text begin
(1) is a tax-exempt organization under section 501(c)(3) of the Internal Revenue
Code;
new text end
new text begin
(2) has articles of incorporation under chapter 317A specifying the purpose of
the organization as including the provision of financial assistance to members of the
Minnesota National Guard and other United States armed forces reserves and their
families and survivors; and
new text end
new text begin
(3) agrees in writing to distribute any grant money received from the adjutant general
under this section to eligible individuals as defined in this section and in accordance
with any written policies and rules the adjutant general may impose as conditions of the
grant to the foundation.
new text end
new text begin
(d) The maximum grant awarded to an eligible individual in a calendar year with
funds from the Minnesota military families relief account, either through an eligible
institution or directly from the adjutant general, may not exceed $2,000.
new text end
new text begin
(e) The state pledges and agrees with all contributors to the account to use the
contributed funds solely for the purpose of providing assistance to eligible individuals.
new text end
new text begin
(f) The state further agrees that it will not impose additional conditions or restrictions
that will limit or otherwise restrict the ability of the adjutant general to award grants
under this section.
new text end
new text begin
(g) For purposes of this section, the term "federal active service" has the meaning
given in section 190.05, subdivision 5c, but excludes service performed exclusively for
purposes of:
new text end
new text begin
(1) basic combat training, advanced individual training, annual training, and periodic
inactive duty training;
new text end
new text begin
(2) special training periodically made available to reserve members; and
new text end
new text begin
(3) service performed in accordance with section 190.08, subdivision 3.
new text end
new text begin Subd. 3. new text end
new text begin Annual report. new text end
new text begin
The adjutant general must report by February 1, 2007,
and each year thereafter, to the chairs and ranking minority members of the legislative
committees and divisions with jurisdiction over military and veterans' affairs on the
number, amounts, and use of grants issued from the Minnesota military families relief
account in the previous year and on the expenses related to administering the account.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for income tax returns for taxable
years beginning after December 31, 2004.
new text end
Sec. 35.
new text begin
[290.434] PUBLIC SAFETY OFFICER CHECKOFF.
new text end
new text begin
(a) Every individual who files an income tax return may designate on their original
return that $1 or more shall be added to the tax or deducted from the refund that would
otherwise be payable by or to that individual and paid into a public safety officer memorial
and survivor account in the special revenue fund. The commissioner of revenue shall, on
the income tax return, notify filers of their right to designate that a portion of their tax or
refund shall be paid into the public safety officer memorial and survivor account. The
sum of the amounts so designated to be paid shall be credited to the account. The account
may be used by the commissioner of public safety to make grants to public safety officer
associations that assist in building and preserving state memorial monuments, assist the
families of public safety officers killed in the line of duty, award scholarships to surviving
family members, and otherwise provide services relating to public safety officers killed in
the line of duty. All interest earned on money accrued, gifts to the program, contributions
to the program, and reimbursements of expenditures shall be credited to the account. All
money in the account is appropriated to the commissioner of public safety for purposes
of this section.
new text end
new text begin
(b) The state pledges and agrees with all contributors to the account to use the
funds contributed solely for the maintenance of public safety officer memorials and for
the benefit of survivors of Minnesota public safety officers killed in the line of duty and
further agrees that it will not impose additional conditions or restrictions that will limit or
otherwise restrict the ability of the commissioner of public safety, in consultation with
the public safety officer memorial and survivor account advisory council, to award grants
from the available funds in the most efficient and effective manner.
new text end
new text begin
(c) The commissioner of public safety must report by January 1, 2004, and each
year thereafter to the chairs and ranking minority members of the legislative committees
and divisions with jurisdiction over criminal justice policy and funding on the number,
amounts, and use of grants issued from the account in the previous year.
new text end
new text begin
(d) A public safety officer memorial and survivor account advisory council is
established to advise the commissioner of public safety on the distribution of grants under
this section. The council must consist of eight members, one from each of the following
organizations: the Minnesota law enforcement memorial association, the Minnesota police
and peace officers association, the Minnesota chiefs of police association, the Minnesota
sheriffs association, the Minnesota state fire department association, the Minnesota
state fire chiefs association, the Minnesota ambulance association, and the Minnesota
emergency medical services association. The council member is the executive director
or president of the organization, or that person's designee. Members must serve without
compensation. The commissioner must consider the advisory council's recommendations
before awarding grants under this section.
new text end
new text begin
(e) As used in this section, "killed in the line of duty" and "public safety officer"
have the meanings given in section 299A.41.
new text end
new text begin
(f) The checkoff under this section is subject to removal from the income tax return
as provided in section 290.439, subdivision 2.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for income tax returns for taxable
years beginning after December 31, 2004.
new text end
Sec. 36.
new text begin
[290.435] K-12 EDUCATION, HIGHER EDUCATION,
TRANSPORTATION, HEALTH CARE, NURSING HOME, AND CLEAN WATER
CHECKOFF.
new text end
new text begin Subdivision 1. new text end
new text begin Checkoffs. new text end
new text begin
(a) Every individual who files an income tax return may
designate on their original return that $1 or more shall be added to the tax or deducted
from the refund that would otherwise be payable by or to that individual.
new text end
new text begin
(b) The taxpayer shall designate that the added or deducted amount shall be paid into
one or more of the following accounts and used for the stated purpose:
new text end
new text begin
(1) K-12 education, for technology and/or capital improvement grants to school
districts;
new text end
new text begin
(2) higher education, for state assistance to individual students based on student need;
new text end
new text begin
(3) transportation, for local road and bridge funds;
new text end
new text begin
(4) health care, to provide funding for public health care programs;
new text end
new text begin
(5) nursing home assistance, for state reimbursement of nursing home costs; or
new text end
new text begin
(6) environmental clean water, for grants to cities for wastewater treatment facilities.
new text end
new text begin
(c) The taxpayer may not designate an amount less than $1 to be paid into any of
the accounts.
new text end
new text begin Subd. 2. new text end
new text begin Appropriation; special accounts. new text end
new text begin
(a) All amounts designated by
taxpayers to be paid into the K-12 education account under subdivision 1, clause (1), must
be deposited in the state treasury and credited to a special K-12 education account. Money
in the account is appropriated annually to the commissioner of education to make onetime
grants to school districts for technology or capital improvements.
new text end
new text begin
(b) All amounts designated by taxpayers to be paid into the higher education account
under subdivision 1, clause (2), must be deposited in the state treasury and credited to a
special higher education account. Money in the account is appropriated annually to the
Minnesota Higher Education Services Office to provide financial assistance to students,
based on financial needs, attending postsecondary educational institutions located in
and operated by this state.
new text end
new text begin
(c) All amounts designated by taxpayers to be paid into the transportation account
under subdivision 1, clause (3), must be deposited in the state treasury and credited to a
special transportation account. Money in the account is appropriated annually to the
commissioner of transportation for improvements to local roads and bridges.
new text end
new text begin
(d) All amounts designated by taxpayers to be paid into the health care account under
subdivision 1, clause (4), must be deposited in the state treasury and credited to a special
health care account. Money in the account is appropriated annually to the commissioner
of human services to provide additional funds for adult participation in MinnesotaCare.
new text end
new text begin
(e) All amounts designated by taxpayers to be paid into the nursing home assistance
account under subdivision 1, clause (5), must be deposited in the state treasury and credited
to a special nursing home assistance account. Money in the account is appropriated
annually to the commissioner of human services to fund a onetime increase in state paid
nursing home reimbursement rates.
new text end
new text begin
(f) All amounts designated by taxpayers to be paid into the environmental clean
water account under subdivision 1, clause (6), must be deposited in the state treasury and
credited to the wastewater infrastructure fund, and annually appropriated to the public
facilities authority to make onetime grants to municipalities for wastewater treatment
facilities.
new text end
new text begin
(g) All amounts appropriated from the special accounts under this section are
onetime appropriations and do not become part of the base level funding for the 2006-2007
biennium.
new text end
new text begin
(h) The checkoffs under this section are subject to removal from the income tax
return as provided in section 290.439, subdivision 2.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxable years beginning after
December 31, 2004.
new text end
Sec. 37.
new text begin
[290.439] ADMINISTRATION OF CHECKOFFS.
new text end
new text begin Subdivision 1. new text end
new text begin Forms. new text end
new text begin
The commissioner must provide a separate form as part of
the income tax return that lists the nongame wildlife checkoff in section 290.432; the state
election campaign fund checkoff in section 10A.31; the National Guard and Reserves
checkoff in section 290.433; the public safety officer checkoff in section 290.434; and the
education, higher education, transportation, health care, nursing home, and clean water
checkoffs in section 290.435. The commissioner must provide a single line on form
M-1 for entering the total amount a taxpayer contributes to all the checkoffs listed on
the separate form.
new text end
new text begin Subd. 2. new text end
new text begin Removal of checkoffs. new text end
new text begin
The commissioner must annually review usage of
the income tax checkoffs in sections 290.433 to 290.435, and determine the number of
returns making contributions and the total amount contributed to each checkoff, including
each of the separate checkoffs provided in section 290.435. If any of the checkoffs
subject to review fails, for two consecutive tax years, to obtain contributions of at least
$100,000 from at least eight percent of all returns that make contributions to any of the
checkoffs in sections 10A.31 and 290.433 to 290.435, the commissioner must remove
the checkoff from the checkoff form and submit legislation proposing the repeal of the
checkoff to the legislature.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxable years beginning after
December 31, 2004.
new text end
Sec. 38.
Minnesota Statutes 2004, section 290.92, subdivision 4b, is amended to read:
Subd. 4b.
Withholding by partnerships.
(a) A partnership shall deduct and
withhold a tax as provided in paragraph (b) for nonresident individual partners based on
their distributive shares of partnership income for a taxable year of the partnership.
(b) The amount of tax withheld is determined by multiplying the partner's
distributive share allocable to Minnesota under section 290.17, paid or credited during
the taxable year by the highest rate used to determine the income tax liability for an
individual under section 290.06, subdivision 2c, except that the amount of tax withheld
may be determined by the commissioner if the partner submits a withholding exemption
certificate under subdivision 5.
(c) The commissioner may reduce or abate the tax withheld under this subdivision if
the partnership had reasonable cause to believe that no tax was due under this section.
(d) Notwithstanding paragraph (a), a partnership is not required to deduct and
withhold tax for a nonresident partner if:
(1) the partner elects to have the tax due paid as part of the partnership's composite
return under section 289A.08, subdivision 7;
(2) the partner has Minnesota assignable federal adjusted gross income from the
partnership of less than $1,000; or
(3) the partnership is liquidated or terminated, the income was generated by a
transaction related to the termination or liquidation, and no cash or other property was
distributed in the current or prior taxable year; deleted text begin or
deleted text end
(4) the distributive shares of partnership income are attributable to:
(i) income required to be recognized because of discharge of indebtedness;
(ii) income recognized because of a sale, exchange, or other disposition of real estate,
depreciable property, or property described in section 179 of the Internal Revenue Code; or
(iii) income recognized on the sale, exchange, or other disposition of any property
that has been the subject of a basis reduction pursuant to section 108, 734, 743, 754, or
1017 of the Internal Revenue Code
to the extent that the income does not include cash received or receivable or, if there
is cash received or receivable, to the extent that the cash is required to be used to pay
indebtedness by the partnership or a secured debt on partnership propertynew text begin ; or
new text end
new text begin (5) the partnership is a publicly traded partnership, as defined in section 7704(b) of
the Internal Revenue Codenew text end .
(e) For purposes of subdivision 6a, and sections 289A.09, subdivision 2, 289A.20,
subdivision 2, paragraph (c), 289A.50, 289A.56, 289A.60, and 289A.63, a partnership is
considered an employer.
(f) To the extent that income is exempt from withholding under paragraph (d), clause
(4), the commissioner has a lien in an amount up to the amount that would be required
to be withheld with respect to the income of the partner attributable to the partnership
interest, but for the application of paragraph (d), clause (4). The lien arises under section
270.69 from the date of assessment of the tax against the partner, and attaches to that
partner's share of the profits and any other money due or to become due to that partner
in respect of the partnership. Notice of the lien may be sent by mail to the partnership,
without the necessity for recording the lien. The notice has the force and effect of a levy
under section 270.70, and is enforceable against the partnership in the manner provided
by that section. Upon payment in full of the liability subsequent to the notice of lien, the
partnership must be notified that the lien has been satisfied.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxable years beginning after
December 31, 2004.
new text end
Sec. 39.
Minnesota Statutes 2004, section 291.005, subdivision 1, is amended to read:
Subdivision 1.
Scope.
Unless the context otherwise clearly requires, the following
terms used in this chapter shall have the following meanings:
(1) "Federal gross estate" means the gross estate of a decedent as valued and
otherwise determined for federal estate tax purposes by federal taxing authorities pursuant
to the provisions of the Internal Revenue Code.
(2) "Minnesota gross estate" means the federal gross estate of a decedent after (a)
excluding therefrom any property included therein which has its situs outside Minnesota,
and (b) including therein any property omitted from the federal gross estate which is
includable therein, has its situs in Minnesota, and was not disclosed to federal taxing
authorities.
(3) "Personal representative" means the executor, administrator or other person
appointed by the court to administer and dispose of the property of the decedent. If there
is no executor, administrator or other person appointed, qualified, and acting within this
state, then any person in actual or constructive possession of any property having a situs in
this state which is included in the federal gross estate of the decedent shall be deemed
to be a personal representative to the extent of the property and the Minnesota estate tax
due with respect to the property.
(4) "Resident decedent" means an individual whose domicile at the time of death
was in Minnesota.
(5) "Nonresident decedent" means an individual whose domicile at the time of
death was not in Minnesota.
(6) "Situs of property" means, with respect to real property, the state or country in
which it is located; with respect to tangible personal property, the state or country in which
it was normally kept or located at the time of the decedent's death; and with respect to
intangible personal property, the state or country in which the decedent was domiciled
at death.
(7) "Commissioner" means the commissioner of revenue or any person to whom the
commissioner has delegated functions under this chapter.
(8) "Internal Revenue Code" means the United States Internal Revenue Code of
1986, as amended through deleted text begin December 31, 2002 deleted text end new text begin April 15, 2005new text end .
new text begin
(9) "Minnesota adjusted taxable estate" means federal adjusted taxable estate as
defined by section 2011(b)(3) of the Internal Revenue Code, increased by the amount of
deduction for state death taxes allowed under section 2058 of the Internal Revenue Code.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for estates of decedents dying after
December 31, 2004.
new text end
Sec. 40.
Minnesota Statutes 2004, section 291.03, subdivision 1, is amended to read:
Subdivision 1.
Tax amount.
new text begin (a) new text end The tax imposed shall be an amount equal to the
proportion of the maximum credit new text begin for state death taxes new text end computed under section 2011 of the
Internal Revenue Code, as amended through December 31, 2000, deleted text begin for state death taxes deleted text end new text begin but
using Minnesota adjusted taxable estate instead of federal adjusted taxable estate,new text end as the
Minnesota gross estate bears to the value of the federal gross estate. The tax determined
under this paragraph shall not be greater than thedeleted text begin federal estate tax deleted text end new text begin amount new text end computed new text begin by
applying the rates and brackets new text end under section 2001 new text begin (c) new text end of the Internal Revenue Codedeleted text begin after
the allowance of deleted text end new text begin to the Minnesota adjusted gross estate and subtracting new text end the federal deleted text begin credits
deleted text end new text begin credit new text end allowed under section 2010 of the Internal Revenue Code of 1986, as amended
through December 31, 2000.
new text begin (b) new text end For the purposes of this section, expenses which are deducted for federal income
tax purposes under section 642(g) of the Internal Revenue Code as amended through
December 31, 2002, are not allowable in computing the tax under this chapter.
new text begin
(c) The executor may make a qualified terminable interest property election, as
defined in section 2056(b)(7) of the Internal Revenue Code, for purposes of computing the
marital deduction under section 2056 of the Internal Revenue Code for the tax under this
chapter that differs from the amount elected for federal estate tax purposes. The election
may not exceed the federal election by more than the difference between the applicable
exclusion amount under section 2010(c) of the Internal Revenue Code and under section
2010(c) of the Internal Revenue Code, as amended through December 31, 2000. The
election must be made on the tax return under this chapter and is irrevocable. All tax
under this chapter must be determined using the qualified terminable interest election
made on the Minnesota return. For purposes of applying sections 2044 and 2207A of the
Internal Revenue Code to the computation of the federal and Minnesota gross estates of
the surviving spouse, amounts for which a qualified terminable interest property election
has been made under this section must be treated as though a valid federal qualified
terminable interest property election under section 2056(b)(7) of the Internal Revenue
Code had been made.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for estates of decedents dying after
December 31, 2004, except paragraph (c) applies for estates of decedents dying after
December 31, 2006.
new text end
Sec. 41.
Minnesota Statutes 2004, section 298.01, subdivision 3, is amended to read:
Subd. 3.
Occupation tax; other ores.
Every person engaged in the business of
mining or producing ores in this state, except iron ore or taconite concentrates, shall pay
an occupation tax to the state of Minnesota as provided in this subdivision. The tax is
determined in the same manner as the tax imposed by section 290.02, except that sections
290.05, subdivision 1, clause (a), deleted text begin and deleted text end 290.17, subdivision 4, new text begin and 290.191, subdivision
2,new text end do not apply. new text begin A person subject to occupation tax under this section shall apportion its net
income on the basis of the percentage obtained by taking the sum of:
new text end
new text begin
(1) 75 percent of the percentage which the sales made within this state in connection
with the trade or business during the tax period are of the total sales wherever made in
connection with the trade or business during the tax period;
new text end
new text begin
(2) 12.5 percent of the percentage which the total tangible property used by the
taxpayer in this state in connection with the trade or business during the tax period is of
the total tangible property, wherever located, used by the taxpayer in connection with the
trade or business during the tax period; and
new text end
new text begin
(3) 12.5 percent of the percentage which the taxpayer's total payrolls paid or
incurred in this state or paid in respect to labor performed in this state in connection with
the trade or business during the tax period are of the taxpayer's total payrolls paid or
incurred in connection with the trade or business during the tax period.
new text end
The tax is in addition to all other taxes.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2006.
new text end
Sec. 42.
Minnesota Statutes 2004, section 298.01, subdivision 4, is amended to read:
Subd. 4.
Occupation tax; iron ore; taconite concentrates.
A person engaged in
the business of mining or producing of iron ore, taconite concentrates or direct reduced ore
in this state shall pay an occupation tax to the state of Minnesota. The tax is determined
in the same manner as the tax imposed by section 290.02, except that sections 290.05,
subdivision 1, clause (a), deleted text begin and deleted text end 290.17, subdivision 4, new text begin and 290.191, subdivision 2,new text end do not
apply. new text begin A person subject to occupation tax under this section shall apportion its net income
on the basis of the percentage obtained by taking the sum of:
new text end
new text begin
(1) 75 percent of the percentage which the sales made within this state in connection
with the trade or business during the tax period are of the total sales wherever made in
connection with the trade or business during the tax period;
new text end
new text begin
(2) 12.5 percent of the percentage which the total tangible property used by the
taxpayer in this state in connection with the trade or business during the tax period is of
the total tangible property, wherever located, used by the taxpayer in connection with the
trade or business during the tax period; and
new text end
new text begin
(3) 12.5 percent of the percentage which the taxpayer's total payrolls paid or
incurred in this state or paid in respect to labor performed in this state in connection with
the trade or business during the tax period are of the taxpayer's total payrolls paid or
incurred in connection with the trade or business during the tax period.
new text end
The tax is in addition to all other taxes.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2006.
new text end
ARTICLE 6
FEDERAL UPDATE
Section 1.
Minnesota Statutes 2004, section 289A.02, subdivision 7, is amended to
read:
Subd. 7.
Internal revenue code.
Unless specifically defined otherwise, "Internal
Revenue Code" means the Internal Revenue Code of 1986, as amended through deleted text begin June
15, 2003 deleted text end new text begin April 15, 2005new 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. 2.
Minnesota Statutes 2004, section 290.01, subdivision 19, as amended by Laws
2005, chapter 1, section 1, is amended to read:
Subd. 19.
Net income.
The term "net income" means the federal taxable income,
as defined in section 63 of the Internal Revenue Code of 1986, as amended through the
date named in this subdivision, incorporating new text begin the federal effective dates of changes to the
Internal Revenue Code and new text end any elections made by the taxpayer in accordance with the
Internal Revenue Code in determining federal taxable income for federal income tax
purposes, and with the modifications provided in subdivisions 19a to 19f.
In the case of a regulated investment company or a fund thereof, as defined in section
851(a) or 851(g) of the Internal Revenue Code, federal taxable income means investment
company taxable income as defined in section 852(b)(2) of the Internal Revenue Code,
except that:
(1) the exclusion of net capital gain provided in section 852(b)(2)(A) of the Internal
Revenue Code does not apply;
(2) the deduction for dividends paid under section 852(b)(2)(D) of the Internal
Revenue Code must be applied by allowing a deduction for capital gain dividends and
exempt-interest dividends as defined in sections 852(b)(3)(C) and 852(b)(5) of the Internal
Revenue Code; and
(3) the deduction for dividends paid must also be applied in the amount of any
undistributed capital gains which the regulated investment company elects to have treated
as provided in section 852(b)(3)(D) of the Internal Revenue Code.
The net income of a real estate investment trust as defined and limited by section
856(a), (b), and (c) of the Internal Revenue Code means the real estate investment trust
taxable income as defined in section 857(b)(2) of the Internal Revenue Code.
The net income of a designated settlement fund as defined in section 468B(d) of
the Internal Revenue Code means the gross income as defined in section 468B(b) of the
Internal Revenue Code.
deleted text begin
The provisions of sections 1113(a), 1117, 1206(a), 1313(a), 1402(a), 1403(a), 1443,
1450, 1501(a), 1605, 1611(a), 1612, 1616, 1617, 1704(l), and 1704(m) of the Small
Business Job Protection Act, Public Law 104-188, the provisions of Public Law 104-117,
the provisions of sections 313(a) and (b)(1), 602(a), 913(b), 941, 961, 971, 1001(a) and
(b), 1002, 1003, 1012, 1013, 1014, 1061, 1062, 1081, 1084(b), 1086, 1087, 1111(a),
1131(b) and (c), 1211(b), 1213, 1530(c)(2), 1601(f)(5) and (h), and 1604(d)(1) of the
Taxpayer Relief Act of 1997, Public Law 105-34, the provisions of section 6010 of the
Internal Revenue Service Restructuring and Reform Act of 1998, Public Law 105-206, the
provisions of section 4003 of the Omnibus Consolidated and Emergency Supplemental
Appropriations Act, 1999, Public Law 105-277, and the provisions of section 318 of the
Consolidated Appropriation Act of 2001, Public Law 106-554, shall become effective at
the time they become effective for federal purposes.
deleted text end
The Internal Revenue Code of 1986, as amended throughdeleted text begin December 31, 1996 deleted text end new text begin April
15, 2005new text end , shall be in effect for taxable years beginning after December 31, 1996.
deleted text begin
The provisions of sections 202(a) and (b), 221(a), 225, 312, 313, 913(a), 934, 962,
1004, 1005, 1052, 1063, 1084(a) and (c), 1089, 1112, 1171, 1204, 1271(a) and (b), 1305(a),
1306, 1307, 1308, 1309, 1501(b), 1502(b), 1504(a), 1505, 1527, 1528, 1530, 1601(d), (e),
(f), and (i) and 1602(a), (b), (c), and (e) of the Taxpayer Relief Act of 1997, Public Law
105-34, the provisions of sections 6004, 6005, 6012, 6013, 6015, 6016, 7002, and 7003 of
the Internal Revenue Service Restructuring and Reform Act of 1998, Public Law 105-206,
the provisions of section 3001 of the Omnibus Consolidated and Emergency Supplemental
Appropriations Act, 1999, Public Law 105-277, the provisions of section 3001 of the
Miscellaneous Trade and Technical Corrections Act of 1999, Public Law 106-36, and the
provisions of section 316 of the Consolidated Appropriation Act of 2001, Public Law
106-554, shall become effective at the time they become effective for federal purposes.
deleted text end
deleted text begin
The Internal Revenue Code of 1986, as amended through December 31, 1997, shall
be in effect for taxable years beginning after December 31, 1997.
deleted text end
deleted text begin
The provisions of sections 5002, 6009, 6011, and 7001 of the Internal Revenue
Service Restructuring and Reform Act of 1998, Public Law 105-206, the provisions of
section 9010 of the Transportation Equity Act for the 21st Century, Public Law 105-178,
the provisions of sections 1004, 4002, and 5301 of the Omnibus Consolidation and
Emergency Supplemental Appropriations Act, 1999, Public Law 105-277, the provision
of section 303 of the Ricky Ray Hemophilia Relief Fund Act of 1998, Public Law
105-369, the provisions of sections 532, 534, 536, 537, and 538 of the Ticket to Work
and Work Incentives Improvement Act of 1999, Public Law 106-170, the provisions of
the Installment Tax Correction Act of 2000, Public Law 106-573, and the provisions of
section 309 of the Consolidated Appropriation Act of 2001, Public Law 106-554, shall
become effective at the time they become effective for federal purposes.
deleted text end
deleted text begin
The Internal Revenue Code of 1986, as amended through December 31, 1998, shall
be in effect for taxable years beginning after December 31, 1998.
deleted text end
deleted text begin
The provisions of the FSC Repeal and Extraterritorial Income Exclusion Act of
2000, Public Law 106-519, and the provision of section 412 of the Job Creation and
Worker Assistance Act of 2002, Public Law 107-147, shall become effective at the time
it became effective for federal purposes.
deleted text end
deleted text begin
The Internal Revenue Code of 1986, as amended through December 31, 1999,
shall be in effect for taxable years beginning after December 31, 1999. The provisions
of sections 306 and 401 of the Consolidated Appropriation Act of 2001, Public Law
106-554, and the provision of section 632(b)(2)(A) of the Economic Growth and Tax
Relief Reconciliation Act of 2001, Public Law 107-16, and provisions of sections 101 and
402 of the Job Creation and Worker Assistance Act of 2002, Public Law 107-147, shall
become effective at the same time it became effective for federal purposes.
deleted text end
deleted text begin
The Internal Revenue Code of 1986, as amended through December 31, 2000,
shall be in effect for taxable years beginning after December 31, 2000. The provisions
of sections 659a and 671 of the Economic Growth and Tax Relief Reconciliation Act of
2001, Public Law 107-16, the provisions of sections 104, 105, and 111 of the Victims of
Terrorism Tax Relief Act of 2001, Public Law 107-134, and the provisions of sections 201,
403, 413, and 606 of the Job Creation and Worker Assistance Act of 2002, Public Law
107-147, shall become effective at the same time it became effective for federal purposes.
deleted text end
deleted text begin
The Internal Revenue Code of 1986, as amended through March 15, 2002, shall be
in effect for taxable years beginning after December 31, 2001.
deleted text end
deleted text begin
The provisions of sections 101 and 102 of the Victims of Terrorism Tax Relief Act
of 2001, Public Law 107-134, shall become effective at the same time it becomes effective
for federal purposes.
deleted text end
deleted text begin
The Internal Revenue Code of 1986, as amended through June 15, 2003, shall be in
effect for taxable years beginning after December 31, 2002. The provisions of section
201 of the Jobs and Growth Tax Relief and Reconciliation Act of 2003, H.R. 2, if it is
enacted into law, are effective at the same time it became effective for federal purposes.
The provisions of the Act of January 7, 2005, Public Law 109-1, to accelerate the income
tax benefits for charitable cash contributions for the relief of victims of the Indian Ocean
tsunami, are effective at the same time it became effective for federal purposes and apply
to the subtraction under subdivision 19b, clause (7).
deleted text end
Except as otherwise provided, references to the Internal Revenue Code in
subdivisions deleted text begin 19a deleted text end new text begin 19 new text end to deleted text begin 19g deleted text end new text begin 19f new text end mean the code in effect for purposes of determining net
income for the applicable year.
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.
Minnesota Statutes 2004, section 290.01, subdivision 19a, is amended to read:
Subd. 19a.
Additions to federal taxable income.
For individuals, estates, and
trusts, there shall be added to federal taxable income:
(1)(i) interest income on obligations of any state other than Minnesota or a political
or governmental subdivision, municipality, or governmental agency or instrumentality
of any state other than Minnesota exempt from federal income taxes under the Internal
Revenue Code or any other federal statute; and
(ii) exempt-interest dividends as defined in section 852(b)(5) of the Internal Revenue
Code, except the portion of the exempt-interest dividends derived from interest income
on obligations of the state of Minnesota or its political or governmental subdivisions,
municipalities, governmental agencies or instrumentalities, but only if the portion of the
exempt-interest dividends from such Minnesota sources paid to all shareholders represents
95 percent or more of the exempt-interest dividends that are paid by the regulated
investment company as defined in section 851(a) of the Internal Revenue Code, or the
fund of the regulated investment company as defined in section 851(g) of the Internal
Revenue Code, making the payment; and
(iii) for the purposes of items (i) and (ii), interest on obligations of an Indian tribal
government described in section 7871(c) of the Internal Revenue Code shall be treated as
interest income on obligations of the state in which the tribe is located;
(2) the amount of income new text begin or sales and use new text end taxes paid or accrued within the taxable
year under this chapter and income new text begin or sales and use new text end taxes paid to any other state or to any
province or territory of Canada, to the extent allowed as a deduction under section 63(d) of
the Internal Revenue Code, but the addition may not be more than the amount by which the
itemized deductions as allowed under section 63(d) of the Internal Revenue Code exceeds
the amount of new text begin (i) new text end the standard deduction as defined in section 63(c) of the Internal Revenue
Code new text begin minus (ii) any addition required under clause (10)new text end . For the purpose of this paragraph,
the disallowance of itemized deductions under section 68 of the Internal Revenue Code of
1986, income new text begin or sales and use new text end tax is the last itemized deduction disallowed;
(3) the capital gain amount of a lump sum distribution to which the special tax under
section 1122(h)(3)(B)(ii) of the Tax Reform Act of 1986, Public Law 99-514, applies;
(4) the amount of income taxes paid or accrued within the taxable year under this
chapter and income taxes paid to any other state or any province or territory of Canada,
to the extent allowed as a deduction in determining federal adjusted gross income. For
the purpose of this paragraph, income taxes do not include the taxes imposed by sections
290.0922, subdivision 1, paragraph (b), 290.9727, 290.9728, and 290.9729;
(5) the amount of expense, interest, or taxes disallowed pursuant to section 290.10;
(6) the amount of a partner's pro rata share of net income which does not flow
through to the partner because the partnership elected to pay the tax on the income under
section 6242(a)(2) of the Internal Revenue Code; deleted text begin and
deleted text end
(7) 80 percent of the depreciation deduction allowed under section 168(k) of the
Internal Revenue Code. For purposes of this clause, if the taxpayer has an activity that
in the taxable year generates a deduction for depreciation under section 168(k) and the
activity generates a loss for the taxable year that the taxpayer is not allowed to claim for
the taxable year, "the depreciation allowed under section 168(k)" for the taxable year is
limited to excess of the depreciation claimed by the activity under section 168(k) over the
amount of the loss from the activity that is not allowed in the taxable year. In succeeding
taxable years when the losses not allowed in the taxable year are allowed, the depreciation
under section 168(k) is allowednew text begin ;
new text end
new text begin
(8) 80 percent of the amount by which the deduction allowed by section 179 of the
Internal Revenue Code exceeds the deduction allowable by section 179 of the Internal
Revenue Code of 1986, as amended through December 31, 2003;
new text end
new text begin
(9) to the extent deducted in computing federal taxable income, the amount of the
deduction allowable under section 199 of the Internal Revenue Code;
new text end
new text begin
(10) for tax years beginning after December 31, 2006, to the extent deducted in
computing federal taxable income, the amount by which the standard deduction allowed
under section 63(c) of the Internal Revenue Code exceeds the standard deduction
allowable under section 63(c) of the Internal Revenue Code of 1986, as amended through
December 31, 2003; and
new text end
new text begin (11) the exclusion allowed under section 139A of the Internal Revenue Code for
federal subsidies for prescription drug plansnew text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2004, except the changes in clause (2) are effective for tax years beginning
after December 31, 2003.
new text end
Sec. 4.
Minnesota Statutes 2004, section 290.01, subdivision 19b, is amended to read:
Subd. 19b.
Subtractions from federal taxable income.
For individuals, estates,
and trusts, there shall be subtracted from federal taxable income:
(1) interest income on obligations of any authority, commission, or instrumentality
of the United States to the extent includable in taxable income for federal income tax
purposes but exempt from state income tax under the laws of the United States;
(2) if included in federal taxable income, the amount of any overpayment of income
tax to Minnesota or to any other state, for any previous taxable year, whether the amount
is received as a refund or as a credit to another taxable year's income tax liability;
(3) the amount paid to others, less the amount used to claim the credit allowed under
section 290.0674, not to exceed $1,625 for each qualifying child in grades kindergarten
to 6 and $2,500 for each qualifying child in grades 7 to 12, for tuition, textbooks, and
transportation of each qualifying child in attending an elementary or secondary school
situated in Minnesota, North Dakota, South Dakota, Iowa, or Wisconsin, wherein a
resident of this state may legally fulfill the state's compulsory attendance laws, which
is not operated for profit, and which adheres to the provisions of the Civil Rights Act
of 1964 and chapter 363A. For the purposes of this clause, "tuition" includes fees or
tuition as defined in section 290.0674, subdivision 1, clause (1). As used in this clause,
"textbooks" includes books and other instructional materials and equipment purchased
or leased for use in elementary and secondary schools in teaching only those subjects
legally and commonly taught in public elementary and secondary schools in this state.
Equipment expenses qualifying for deduction includes expenses as defined and limited in
section 290.0674, subdivision 1, clause (3). "Textbooks" does not include instructional
books and materials used in the teaching of religious tenets, doctrines, or worship, the
purpose of which is to instill such tenets, doctrines, or worship, nor does it include books
or materials for, or transportation to, extracurricular activities including sporting events,
musical or dramatic events, speech activities, driver's education, or similar programs. For
purposes of the subtraction provided by this clause, "qualifying child" has the meaning
given in section 32(c)(3) of the Internal Revenue Code;
(4) income as provided under section 290.0802;
(5) to the extent included in federal adjusted gross income, income realized on
disposition of property exempt from tax under section 290.491;
(6) to the extent included in federal taxable income, postservice benefits for youth
community service under section 124D.42 for volunteer service under United States
Code, title 42, sections 12601 to 12604;
(7) to the extent not deducted in determining federal taxable income by an individual
who does not itemize deductions for federal income tax purposes for the taxable year, an
amount equal to 50 percent of the excess of charitable contributionsnew text begin over $500 new text end allowable
as a deduction for the taxable year under section 170(a) of the Internal Revenue Code
deleted text begin over $500 deleted text end new text begin and under the provisions of Public Law 109-1new text end ;
(8) for taxable years beginning before January 1, 2008, the amount of the federal
small ethanol producer credit allowed under section 40(a)(3) of the Internal Revenue Code
which is included in gross income under section 87 of the Internal Revenue Code;
(9) for individuals who are allowed a federal foreign tax credit for taxes that do not
qualify for a credit under section 290.06, subdivision 22, an amount equal to the carryover
of subnational foreign taxes for the taxable year, but not to exceed the total subnational
foreign taxes reported in claiming the foreign tax credit. For purposes of this clause,
"federal foreign tax credit" means the credit allowed under section 27 of the Internal
Revenue Code, and "carryover of subnational foreign taxes" equals the carryover allowed
under section 904(c) of the Internal Revenue Code minus national level foreign taxes to
the extent they exceed the federal foreign tax credit;
(10) in each of the five tax years immediately following the tax year in which an
addition is required under subdivision 19a, clause (7), an amount equal to one-fifth of
the delayed depreciation. For purposes of this clause, "delayed depreciation" means the
amount of the addition made by the taxpayer under subdivision 19a, clause (7), minus the
positive value of any net operating loss under section 172 of the Internal Revenue Code
generated for the tax year of the addition. The resulting delayed depreciation cannot be
less than zero; deleted text begin and
deleted text end
(11) job opportunity building zone income as provided under section 469.316deleted text begin .deleted text end new text begin ;
new text end
new text begin
(12) in each of the five tax years immediately following the tax year in which an
addition is required under subdivision 19a, clause (8), or 19c, clause (17), in the case of
a shareholder of a corporation that is an S corporation, an amount equal to one-fifth of
the addition made by the taxpayer under subdivision 19a, clause (8), or 19c, clause (17),
in the case of a shareholder of a corporation that is an S corporation, minus the positive
value of any net operating loss under section 172 of the Internal Revenue Code generated
for the tax year of the addition. If the net operating loss exceeds the addition for the tax
year, a subtraction is not allowed under this clause; and
new text end
new text begin
(13) to the extent included in federal taxable income, compensation paid to a service
member as defined in United States Code, title 10, section 101(a)(5), for military service
as defined in the Service Member Civil Relief Act, Public Law 108-189, section 101(2).
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2004, except the change to clause (7) is effective for tax years beginning
after December 31, 2003.
new text end
Sec. 5.
Minnesota Statutes 2004, section 290.01, subdivision 19c, is amended to read:
Subd. 19c.
Corporations; additions to federal taxable income.
For corporations,
there shall be added to federal taxable income:
(1) the amount of any deduction taken for federal income tax purposes for income,
excise, or franchise taxes based on net income or related minimum taxes, including but not
limited to the tax imposed under section 290.0922, paid by the corporation to Minnesota,
another state, a political subdivision of another state, the District of Columbia, or any
foreign country or possession of the United States;
(2) interest not subject to federal tax upon obligations of: the United States, its
possessions, its agencies, or its instrumentalities; the state of Minnesota or any other
state, any of its political or governmental subdivisions, any of its municipalities, or any
of its governmental agencies or instrumentalities; the District of Columbia; or Indian
tribal governments;
(3) exempt-interest dividends received as defined in section 852(b)(5) of the Internal
Revenue Code;
(4) the amount of any net operating loss deduction taken for federal income tax
purposes under section 172 or 832(c)(10) of the Internal Revenue Code or operations loss
deduction under section 810 of the Internal Revenue Code;
(5) the amount of any special deductions taken for federal income tax purposes
under sections 241 to 247 of the Internal Revenue Code;
(6) losses from the business of mining, as defined in section 290.05, subdivision 1,
clause (a), that are not subject to Minnesota income tax;
(7) the amount of any capital losses deducted for federal income tax purposes under
sections 1211 and 1212 of the Internal Revenue Code;
(8) the exempt foreign trade income of a foreign sales corporation under sections
921(a) and 291 of the Internal Revenue Code;
(9) the amount of percentage depletion deducted under sections 611 through 614 and
291 of the Internal Revenue Code;
(10) for certified pollution control facilities placed in service in a taxable year
beginning before December 31, 1986, and for which amortization deductions were elected
under section 169 of the Internal Revenue Code of 1954, as amended through December
31, 1985, the amount of the amortization deduction allowed in computing federal taxable
income for those facilities;
(11) the amount of any deemed dividend from a foreign operating corporation
determined pursuant to section 290.17, subdivision 4, paragraph (g);
(12) the amount of any environmental tax paid under section 59(a) of the Internal
Revenue Code;
(13) the amount of a partner's pro rata share of net income which does not flow
through to the partner because the partnership elected to pay the tax on the income under
section 6242(a)(2) of the Internal Revenue Code;
(14) the amount of net income excluded under section 114 of the Internal Revenue
Code;
(15) any increase in subpart F income, as defined in section 952(a) of the Internal
Revenue Code, for the taxable year when subpart F income is calculated without regard to
the provisions of section 614 of Public Law 107-147; deleted text begin and
deleted text end
(16) 80 percent of the depreciation deduction allowed under section 168(k) of the
Internal Revenue Code. For purposes of this clause, if the taxpayer has an activity that
in the taxable year generates a deduction for depreciation under section 168(k) and the
activity generates a loss for the taxable year that the taxpayer is not allowed to claim for
the taxable year, "the depreciation allowed under section 168(k)" for the taxable year is
limited to excess of the depreciation claimed by the activity under section 168(k) over the
amount of the loss from the activity that is not allowed in the taxable year. In succeeding
taxable years when the losses not allowed in the taxable year are allowed, the depreciation
under section 168(k) is allowednew text begin ;
new text end
new text begin
(17) 80 percent of the amount by which the deduction allowed by section 179 of the
Internal Revenue Code exceeds the deduction allowable by section 179 of the Internal
Revenue Code of 1986, as amended through December 31, 2003;
new text end
new text begin
(18) to the extent deducted in computing federal taxable income, the amount of the
deduction allowable under section 199 of the Internal Revenue Code; and
new text end
new text begin (19) the exclusion allowed under section 139A of the Internal Revenue Code for
federal subsidies for prescription drug plansnew text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2004.
new text end
Sec. 6.
Minnesota Statutes 2004, section 290.01, subdivision 19d, is amended to read:
Subd. 19d.
Corporations; modifications decreasing federal taxable income.
For
corporations, there shall be subtracted from federal taxable income after the increases
provided in subdivision 19c:
(1) the amount of foreign dividend gross-up added to gross income for federal
income tax purposes under section 78 of the Internal Revenue Code;
(2) the amount of salary expense not allowed for federal income tax purposes due to
claiming the federal jobs credit under section 51 of the Internal Revenue Code;
(3) any dividend (not including any distribution in liquidation) paid within the
taxable year by a national or state bank to the United States, or to any instrumentality of
the United States exempt from federal income taxes, on the preferred stock of the bank
owned by the United States or the instrumentality;
(4) amounts disallowed for intangible drilling costs due to differences between
this chapter and the Internal Revenue Code in taxable years beginning before January
1, 1987, as follows:
(i) to the extent the disallowed costs are represented by physical property, an amount
equal to the allowance for depreciation under Minnesota Statutes 1986, section 290.09,
subdivision 7, subject to the modifications contained in subdivision 19e; and
(ii) to the extent the disallowed costs are not represented by physical property, an
amount equal to the allowance for cost depletion under Minnesota Statutes 1986, section
290.09, subdivision 8;
(5) the deduction for capital losses pursuant to sections 1211 and 1212 of the
Internal Revenue Code, except that:
(i) for capital losses incurred in taxable years beginning after December 31, 1986,
capital loss carrybacks shall not be allowed;
(ii) for capital losses incurred in taxable years beginning after December 31, 1986,
a capital loss carryover to each of the 15 taxable years succeeding the loss year shall be
allowed;
(iii) for capital losses incurred in taxable years beginning before January 1, 1987, a
capital loss carryback to each of the three taxable years preceding the loss year, subject to
the provisions of Minnesota Statutes 1986, section 290.16, shall be allowed; and
(iv) for capital losses incurred in taxable years beginning before January 1, 1987,
a capital loss carryover to each of the five taxable years succeeding the loss year to the
extent such loss was not used in a prior taxable year and subject to the provisions of
Minnesota Statutes 1986, section 290.16, shall be allowed;
(6) an amount for interest and expenses relating to income not taxable for federal
income tax purposes, if (i) the income is taxable under this chapter and (ii) the interest and
expenses were disallowed as deductions under the provisions of section 171(a)(2), 265 or
291 of the Internal Revenue Code in computing federal taxable income;
(7) in the case of mines, oil and gas wells, other natural deposits, and timber for
which percentage depletion was disallowed pursuant to subdivision 19c, clause (11), a
reasonable allowance for depletion based on actual cost. In the case of leases the deduction
must be apportioned between the lessor and lessee in accordance with rules prescribed
by the commissioner. In the case of property held in trust, the allowable deduction must
be apportioned between the income beneficiaries and the trustee in accordance with the
pertinent provisions of the trust, or if there is no provision in the instrument, on the basis
of the trust's income allocable to each;
(8) for certified pollution control facilities placed in service in a taxable year
beginning before December 31, 1986, and for which amortization deductions were elected
under section 169 of the Internal Revenue Code of 1954, as amended through December
31, 1985, an amount equal to the allowance for depreciation under Minnesota Statutes
1986, section 290.09, subdivision 7;
(9) amounts included in federal taxable income that are due to refunds of income,
excise, or franchise taxes based on net income or related minimum taxes paid by the
corporation to Minnesota, another state, a political subdivision of another state, the
District of Columbia, or a foreign country or possession of the United States to the extent
that the taxes were added to federal taxable income under section 290.01, subdivision 19c,
clause (1), in a prior taxable year;
(10) 80 percent of royalties, fees, or other like income accrued or received from a
foreign operating corporation or a foreign corporation which is part of the same unitary
business as the receiving corporation;
(11) income or gains from the business of mining as defined in section 290.05,
subdivision 1, clause (a), that are not subject to Minnesota franchise tax;
(12) the amount of handicap access expenditures in the taxable year which are not
allowed to be deducted or capitalized under section 44(d)(7) of the Internal Revenue Code;
(13) the amount of qualified research expenses not allowed for federal income tax
purposes under section 280C(c) of the Internal Revenue Code, but only to the extent that
the amount exceeds the amount of the credit allowed under section 290.068;
(14) the amount of salary expenses not allowed for federal income tax purposes due
to claiming the Indian employment credit under section 45A(a) of the Internal Revenue
Code;
(15) the amount of any refund of environmental taxes paid under section 59A of the
Internal Revenue Code;
(16) for taxable years beginning before January 1, 2008, the amount of the federal
small ethanol producer credit allowed under section 40(a)(3) of the Internal Revenue Code
which is included in gross income under section 87 of the Internal Revenue Code;
(17) for a corporation whose foreign sales corporation, as defined in section 922
of the Internal Revenue Code, constituted a foreign operating corporation during any
taxable year ending before January 1, 1995, and a return was filed by August 15, 1996,
claiming the deduction under section 290.21, subdivision 4, for income received from
the foreign operating corporation, an amount equal to 1.23 multiplied by the amount of
income excluded under section 114 of the Internal Revenue Code, provided the income is
not income of a foreign operating company;
(18) any decrease in subpart F income, as defined in section 952(a) of the Internal
Revenue Code, for the taxable year when subpart F income is calculated without regard to
the provisions of section 614 of Public Law 107-147; deleted text begin and
deleted text end
(19) in each of the five tax years immediately following the tax year in which an
addition is required under subdivision 19c, clause (16), an amount equal to one-fifth of
the delayed depreciation. For purposes of this clause, "delayed depreciation" means the
amount of the addition made by the taxpayer under subdivision 19c, clause (16). The
resulting delayed depreciation cannot be less than zeronew text begin ; and
new text end
new text begin (20) in each of the five tax years immediately following the tax year in which an
addition is required under subdivision 19c, clause (17), an amount equal to one-fifth of the
amount of the additionnew text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2004.
new text end
Sec. 7.
Minnesota Statutes 2004, section 290.01, subdivision 31, is amended to read:
Subd. 31.
Internal revenue code.
Unless specifically defined otherwise, "Internal
Revenue Code" means the Internal Revenue Code of 1986, as amended through deleted text begin June
15, 2003 deleted text end new text begin April 15, 2005new text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment
except the changes incorporated by federal changes are effective at the same times as the
changes were effective for federal purposes.
new text end
Sec. 8.
Minnesota Statutes 2004, section 290.032, subdivision 1, is amended to read:
Subdivision 1.
Imposition.
There is hereby imposed as an addition to the annual
income tax for a taxable year of a taxpayer in the classes described in section 290.03 a
tax with respect to any distribution received by such taxpayer that is treated as a lump
sum distribution under section deleted text begin 402(d) of the Internal Revenue Code deleted text end new text begin 1401(c)(2) of the
Small Business Job Protection Act, Public Law 104-188 new text end and that is subject to tax for such
taxable year under section deleted text begin 402(d) of the Internal Revenue Code deleted text end new text begin 1401(c)(2) of the Small
Business Job Protection Act, Public Law 104-188new text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 1999.
new text end
Sec. 9.
Minnesota Statutes 2004, section 290.032, subdivision 2, is amended to read:
Subd. 2.
Computation.
The amount of tax imposed by subdivision 1 shall be
computed in the same way as the tax imposed under section 402(d) of the Internal Revenue
Code new text begin of 1986, as amended through December 31, 1995new text end , except that the initial separate tax
shall be an amount equal to five times the tax which would be imposed by section 290.06,
subdivision 2c, if the recipient was an unmarried individual, and the taxable net income
was an amount equal to one-fifth of the excess of
(i) the total taxable amount of the lump sum distribution for the year, over
(ii) the minimum distribution allowance, and except that references in section
402(d) of the Internal Revenue Code new text begin of 1986, as amended through December 31, 1995,new text end to
paragraph (1)(A) thereof shall instead be references to subdivision 1, and the excess, if
any, of the subtraction base amount over federal taxable income for a qualified individual
as provided under section 290.0802, subdivision 2.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 1999.
new text end
Sec. 10.
Minnesota Statutes 2004, section 290.06, subdivision 2c, is amended to read:
Subd. 2c.
Schedules of rates for individuals, estates, and trusts.
(a) The income
taxes imposed by this chapter upon married individuals filing joint returns and surviving
spouses as defined in section 2(a) of the Internal Revenue Code must be computed by
applying to their taxable net income the following schedule of rates:
(1) On the first $25,680, 5.35 percent;
(2) On all over $25,680, but not over $102,030, 7.05 percent;
(3) On all over $102,030, 7.85 percent.
Married individuals filing separate returns, estates, and trusts must compute their
income tax by applying the above rates to their taxable income, except that the income
brackets will be one-half of the above amounts.
(b) The income taxes imposed by this chapter upon unmarried individuals must be
computed by applying to taxable net income the following schedule of rates:
(1) On the first $17,570, 5.35 percent;
(2) On all over $17,570, but not over $57,710, 7.05 percent;
(3) On all over $57,710, 7.85 percent.
(c) The income taxes imposed by this chapter upon unmarried individuals qualifying
as a head of household as defined in section 2(b) of the Internal Revenue Code must be
computed by applying to taxable net income the following schedule of rates:
(1) On the first $21,630, 5.35 percent;
(2) On all over $21,630, but not over $86,910, 7.05 percent;
(3) On all over $86,910, 7.85 percent.
(d) In lieu of a tax computed according to the rates set forth in this subdivision, the
tax of any individual taxpayer whose taxable net income for the taxable year is less than
an amount determined by the commissioner must be computed in accordance with tables
prepared and issued by the commissioner of revenue based on income brackets of not
more than $100. The amount of tax for each bracket shall be computed at the rates set
forth in this subdivision, provided that the commissioner may disregard a fractional part of
a dollar unless it amounts to 50 cents or more, in which case it may be increased to $1.
(e) An individual who is not a Minnesota resident for the entire year must compute
the individual's Minnesota income tax as provided in this subdivision. After the
application of the nonrefundable credits provided in this chapter, the tax liability must
then be multiplied by a fraction in which:
(1) the numerator is the individual's Minnesota source federal adjusted gross income
as defined in section 62 of the Internal Revenue Code and increased by the additions
required under section 290.01, subdivision 19a, clauses (1), (5), deleted text begin and deleted text end (6), new text begin (7), (8), and
(9),new text end and reduced by the subtraction under section 290.01, subdivision 19b, clause (11), and
the Minnesota assignable portion of the subtraction for United States government interest
under section 290.01, subdivision 19b, clause (1), new text begin and the subtractions under clauses (10),
(11), (12), and (13),new text end after applying the allocation and assignability provisions of section
290.081, clause (a), or 290.17; and
(2) the denominator is the individual's federal adjusted gross income as defined in
section 62 of the Internal Revenue Code of 1986, increased by the amounts specified in
section 290.01, subdivision 19a, clauses (1), (5), deleted text begin and deleted text end (6), new text begin (7), (8), and (9),new text end and reduced by
the amounts specified in section 290.01, subdivision 19b, clauses (1) deleted text begin and deleted text end new text begin , (10),new text end (11)new text begin ,
(12), and (13)new text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2004.
new text end
Sec. 11.
Minnesota Statutes 2004, section 290.067, subdivision 1, is amended to read:
Subdivision 1.
Amount of credit.
(a) A taxpayer may take as a credit against the
tax due from the taxpayer and a spouse, if any, under this chapter an amount equal to the
dependent care credit for which the taxpayer is eligible pursuant to the provisions of
section 21 of the Internal Revenue Code subject to the limitations provided in subdivision
2 except that in determining whether the child qualified as a dependent, income received
as a Minnesota family investment program grant or allowance to or on behalf of the child
must not be taken into account in determining whether the child received more than half
of the child's support from the taxpayer, and the provisions of section 32(b)(1)(D) of
the Internal Revenue Code do not apply.
(b) If a child who has not attained the age of six years at the close of the taxable year
is cared for at a licensed family day care home operated by the child's parent, the taxpayer
is deemed to have paid employment-related expenses. If the child is 16 months old or
younger at the close of the taxable year, the amount of expenses deemed to have been paid
equals the maximum limit for one qualified individual under section 21(c) and (d) of the
Internal Revenue Code. If the child is older than 16 months of age but has not attained the
age of six years at the close of the taxable year, the amount of expenses deemed to have
been paid equals the amount the licensee would charge for the care of a child of the same
age for the same number of hours of care.
(c) If a married couple:
(1) has a child who has not attained the age of one year at the close of the taxable
year;
(2) files a joint tax return for the taxable year; and
(3) does not participate in a dependent care assistance program as defined in section
129 of the Internal Revenue Code, in lieu of the actual employment related expenses paid
for that child under paragraph (a) or the deemed amount under paragraph (b), the lesser of
(i) the combined earned income of the couple or (ii) the amount of the maximum limit for
one qualified individual under section 21(c) and (d) of the Internal Revenue Code will
be deemed to be the employment related expense paid for that child. The earned income
limitation of section 21(d) of the Internal Revenue Code shall not apply to this deemed
amount. These deemed amounts apply regardless of whether any employment-related
expenses have been paid.
(d) If the taxpayer is not required and does not file a federal individual income tax
return for the tax year, no credit is allowed for any amount paid to any person unless:
(1) the name, address, and taxpayer identification number of the person are included
on the return claiming the credit; or
(2) if the person is an organization described in section 501(c)(3) of the Internal
Revenue Code and exempt from tax under section 501(a) of the Internal Revenue Code,
the name and address of the person are included on the return claiming the credit.
In the case of a failure to provide the information required under the preceding sentence,
the preceding sentence does not apply if it is shown that the taxpayer exercised due
diligence in attempting to provide the information required.
In the case of a nonresident, part-year resident, or a person who has earned income
not subject to tax under this chapter including earned income excluded pursuant to section
290.01, subdivision 19b, clause (11), the credit determined under section 21 of the Internal
Revenue Code must be allocated based on the ratio by which the earned income of the
claimant and the claimant's spouse from Minnesota sources bears to the total earned
income of the claimant and the claimant's spouse.
new text begin
For residents of Minnesota, the exclusion of combat pay under section 112 of the
Internal Revenue Code is not considered "earned income not subject to tax under this
chapter."
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2003.
new text end
Sec. 12.
Minnesota Statutes 2004, section 290.067, subdivision 2a, is amended to read:
Subd. 2a.
Income.
(a) For purposes of this section, "income" means the sum of
the following:
(1) federal adjusted gross income as defined in section 62 of the Internal Revenue
Code; and
(2) the sum of the following amounts to the extent not included in clause (1):
(i) all nontaxable income;
(ii) the amount of a passive activity loss that is not disallowed as a result of section
469, paragraph (i) or (m) of the Internal Revenue Code and the amount of passive activity
loss carryover allowed under section 469(b) of the Internal Revenue Code;
(iii) an amount equal to the total of any discharge of qualified farm indebtedness
of a solvent individual excluded from gross income under section 108(g) of the Internal
Revenue Code;
(iv) cash public assistance and relief;
(v) any pension or annuity (including railroad retirement benefits, all payments
received under the federal Social Security Act, supplemental security income, and veterans
benefits), which was not exclusively funded by the claimant or spouse, or which was
funded exclusively by the claimant or spouse and which funding payments were excluded
from federal adjusted gross income in the years when the payments were made;
(vi) interest received from the federal or a state government or any instrumentality
or political subdivision thereof;
(vii) workers' compensation;
(viii) nontaxable strike benefits;
(ix) the gross amounts of payments received in the nature of disability income or
sick pay as a result of accident, sickness, or other disability, whether funded through
insurance or otherwise;
(x) a lump sum distribution under section 402(e)(3) of the Internal Revenue Code
new text begin of 1986, as amended through December 31, 1995new text end ;
(xi) contributions made by the claimant to an individual retirement account,
including a qualified voluntary employee contribution; simplified employee pension plan;
self-employed retirement plan; cash or deferred arrangement plan under section 401(k)
of the Internal Revenue Code; or deferred compensation plan under section 457 of the
Internal Revenue Code; deleted text begin and
deleted text end
(xii) nontaxable scholarship or fellowship grantsnew text begin ;
new text end
new text begin
(xiii) the amount of deduction allowed under section 199 of the Internal Revenue
Code; and
new text end
new text begin (xiv) the amount of deduction allowed under section 220 or 223 of the Internal
Revenue Codenew text end .
In the case of an individual who files an income tax return on a fiscal year basis, the
term "federal adjusted gross income" means federal adjusted gross income reflected in the
fiscal year ending in the next calendar year. Federal adjusted gross income may not be
reduced by the amount of a net operating loss carryback or carryforward or a capital loss
carryback or carryforward allowed for the year.
(b) "Income" does not include:
(1) amounts excluded pursuant to the Internal Revenue Code, sections 101(a) and
102;
(2) amounts of any pension or annuity that were exclusively funded by the claimant
or spouse if the funding payments were not excluded from federal adjusted gross income
in the years when the payments were made;
(3) surplus food or other relief in kind supplied by a governmental agency;
(4) relief granted under chapter 290A;
(5) child support payments received under a temporary or final decree of dissolution
or legal separation; and
(6) restitution payments received by eligible individuals and excludable interest as
defined in section 803 of the Economic Growth and Tax Relief Reconciliation Act of
2001, Public Law 107-16.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2003.
new text end
Sec. 13.
Minnesota Statutes 2004, section 290.0671, subdivision 1, is amended to read:
Subdivision 1.
Credit allowed.
(a) An individual is allowed a credit against the tax
imposed by this chapter equal to a percentage of earned income. To receive a credit, a
taxpayer must be eligible for a credit under section 32 of the Internal Revenue Code.
(b) For individuals with no qualifying children, the credit equals 1.9125 percent of
the first $4,620 of earned income. The credit is reduced by 1.9125 percent of earned
income or modified adjusted gross income, whichever is greater, in excess of $5,770,
but in no case is the credit less than zero.
(c) For individuals with one qualifying child, the credit equals 8.5 percent of the first
$6,920 of earned income and 8.5 percent of earned income over $12,080 but less than
$13,450. The credit is reduced by 5.73 percent of earned income or modified adjusted
gross income, whichever is greater, in excess of $15,080, but in no case is the credit
less than zero.
(d) For individuals with two or more qualifying children, the credit equals ten
percent of the first $9,720 of earned income and 20 percent of earned income over
$14,860 but less than $16,800. The credit is reduced by 10.3 percent of earned income
or modified adjusted gross income, whichever is greater, in excess of $17,890, but in no
case is the credit less than zero.
(e) For a nonresident or part-year resident, the credit must be allocated based on the
percentage calculated under section 290.06, subdivision 2c, paragraph (e).
(f) For a person who was a resident for the entire tax year and has earned income
not subject to tax under this chapter, including income excluded under section 290.01,
subdivision 19b, clause (11), the credit must be allocated based on the ratio of federal
adjusted gross income reduced by the earned income not subject to tax under this chapter
over federal adjusted gross income. new text begin For the purposes of this paragraph, the exclusion of
combat pay under section 112 of the Internal Revenue Code is not considered "earned
income not subject to tax under this chapter."
new text end
(g) For tax years beginning after December 31, 2001, and before December 31,
2004, the $5,770 in paragraph (b), the $15,080 in paragraph (c), and the $17,890 in
paragraph (d), after being adjusted for inflation under subdivision 7, are each increased by
$1,000 for married taxpayers filing joint returns.
(h) For tax years beginning after December 31, 2004, and before December 31,
2007, the $5,770 in paragraph (b), the $15,080 in paragraph (c), and the $17,890 in
paragraph (d), after being adjusted for inflation under subdivision 7, are each increased by
$2,000 for married taxpayers filing joint returns.
(i) For tax years beginning after December 31, 2007, and before December 31, 2010,
the $5,770 in paragraph (b), the $15,080 in paragraph (c), and the $17,890 in paragraph
(d), after being adjusted for inflation under subdivision 7, are each increased by $3,000 for
married taxpayers filing joint returns. For tax years beginning after December 31, 2008,
the $3,000 is adjusted annually for inflation under subdivision 7.
(j) The commissioner shall construct tables showing the amount of the credit at
various income levels and make them available to taxpayers. The tables shall follow
the schedule contained in this subdivision, except that the commissioner may graduate
the transition between income brackets.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2003.
new text end
Sec. 14.
Minnesota Statutes 2004, section 290.0675, subdivision 1, is amended to read:
Subdivision 1.
Definitions.
(a) For purposes of this section the following terms
have the meanings given.
(b) "Earned income" means the sum of the following, to the extent included in
Minnesota taxable income:
(1) earned income as defined in section 32(c)(2) of the Internal Revenue Code;
(2) income received from a retirement pension, profit-sharing, stock bonus, or
annuity plan; and
(3) Social Security benefits as defined in section 86(d)(1) of the Internal Revenue
Code.
(c) "Taxable income" means net income as defined in section 290.01, subdivision 19.
(d) "Earned income of lesser-earning spouse" means the earned income of the spouse
with the lesser amount of earned income as defined in paragraph (b) for the taxable year
minus the sum of (i) the amount for one exemption under section 151(d) of the Internal
Revenue Code and (ii) one-half the amount of the standard deduction under section
63(c)(2)(A) and (4) of the Internal Revenue Code new text begin minus one-half of any addition required
under section 290.01, subdivision 19a, clause (10)new text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2004.
new text end
Sec. 15.
Minnesota Statutes 2004, section 290.091, subdivision 2, is amended to read:
Subd. 2.
Definitions.
For purposes of the tax imposed by this section, the following
terms have the meanings given:
(a) "Alternative minimum taxable income" means the sum of the following for
the taxable year:
(1) the taxpayer's federal alternative minimum taxable income as defined in section
55(b)(2) of the Internal Revenue Code;
(2) the taxpayer's itemized deductions allowed in computing federal alternative
minimum taxable income, but excluding:
(i) the charitable contribution deduction under section 170 of the Internal Revenue
Code to the extent that the deduction exceeds 1.0 percent of adjusted gross income, as
defined in section 62 of the Internal Revenue Code;
(ii) the medical expense deduction;
(iii) the casualty, theft, and disaster loss deduction; and
(iv) the impairment-related work expenses of a disabled person;
(3) for depletion allowances computed under section 613A(c) of the Internal
Revenue Code, with respect to each property (as defined in section 614 of the Internal
Revenue Code), to the extent not included in federal alternative minimum taxable income,
the excess of the deduction for depletion allowable under section 611 of the Internal
Revenue Code for the taxable year over the adjusted basis of the property at the end of the
taxable year (determined without regard to the depletion deduction for the taxable year);
(4) to the extent not included in federal alternative minimum taxable income, the
amount of the tax preference for intangible drilling cost under section 57(a)(2) of the
Internal Revenue Code determined without regard to subparagraph (E);
(5) to the extent not included in federal alternative minimum taxable income, the
amount of interest income as provided by section 290.01, subdivision 19a, clause (1); and
(6) the amount of addition required by section 290.01, subdivision 19a, deleted text begin clause
deleted text end new text begin clauses new text end (7)new text begin , (8), and (9)new text end ;
less the sum of the amounts determined under the following:
(1) interest income as defined in section 290.01, subdivision 19b, clause (1);
(2) an overpayment of state income tax as provided by section 290.01, subdivision
19b, clause (2), to the extent included in federal alternative minimum taxable income;
(3) the amount of investment interest paid or accrued within the taxable year on
indebtedness to the extent that the amount does not exceed net investment income, as
defined in section 163(d)(4) of the Internal Revenue Code. Interest does not include
amounts deducted in computing federal adjusted gross income; and
(4) amounts subtracted from federal taxable income as provided by section 290.01,
subdivision 19b, clauses (10) deleted text begin and deleted text end new text begin ,new text end (11)new text begin , (12), and (13)new text end .
In the case of an estate or trust, alternative minimum taxable income must be
computed as provided in section 59(c) of the Internal Revenue Code.
(b) "Investment interest" means investment interest as defined in section 163(d)(3)
of the Internal Revenue Code.
(c) "Tentative minimum tax" equals 6.4 percent of alternative minimum taxable
income after subtracting the exemption amount determined under subdivision 3.
(d) "Regular tax" means the tax that would be imposed under this chapter (without
regard to this section and section 290.032), reduced by the sum of the nonrefundable
credits allowed under this chapter.
(e) "Net minimum tax" means the minimum tax imposed by this section.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2004.
new text end
Sec. 16.
Minnesota Statutes 2004, section 290A.03, subdivision 3, is amended to read:
Subd. 3.
Income.
(1) "Income" means the sum of the following:
(a) federal adjusted gross income as defined in the Internal Revenue Code; and
(b) the sum of the following amounts to the extent not included in clause (a):
(i) all nontaxable income;
(ii) the amount of a passive activity loss that is not disallowed as a result of section
469, paragraph (i) or (m) of the Internal Revenue Code and the amount of passive activity
loss carryover allowed under section 469(b) of the Internal Revenue Code;
(iii) an amount equal to the total of any discharge of qualified farm indebtedness
of a solvent individual excluded from gross income under section 108(g) of the Internal
Revenue Code;
(iv) cash public assistance and relief;
(v) any pension or annuity (including railroad retirement benefits, all payments
received under the federal Social Security Act, supplemental security income, and veterans
benefits), which was not exclusively funded by the claimant or spouse, or which was
funded exclusively by the claimant or spouse and which funding payments were excluded
from federal adjusted gross income in the years when the payments were made;
(vi) interest received from the federal or a state government or any instrumentality
or political subdivision thereof;
(vii) workers' compensation;
(viii) nontaxable strike benefits;
(ix) the gross amounts of payments received in the nature of disability income or
sick pay as a result of accident, sickness, or other disability, whether funded through
insurance or otherwise;
(x) a lump sum distribution under section 402(e)(3) of the Internal Revenue Code
new text begin of 1986, as amended through December 31, 1995new text end ;
(xi) contributions made by the claimant to an individual retirement account,
including a qualified voluntary employee contribution; simplified employee pension plan;
self-employed retirement plan; cash or deferred arrangement plan under section 401(k)
of the Internal Revenue Code; or deferred compensation plan under section 457 of the
Internal Revenue Code; deleted text begin and
deleted text end
(xii) nontaxable scholarship or fellowship grantsnew text begin ;
new text end
new text begin
(xiii) the amount of deduction allowed under section 199 of the Internal Revenue
Code; and
new text end
new text begin (xiv) the amount of deduction allowed under section 220 or 223 of the Internal
Revenue Codenew text end .
In the case of an individual who files an income tax return on a fiscal year basis, the
term "federal adjusted gross income" shall mean federal adjusted gross income reflected
in the fiscal year ending in the calendar year. Federal adjusted gross income shall not be
reduced by the amount of a net operating loss carryback or carryforward or a capital loss
carryback or carryforward allowed for the year.
(2) "Income" does not include:
(a) amounts excluded pursuant to the Internal Revenue Code, sections 101(a) and
102;
(b) amounts of any pension or annuity which was exclusively funded by the claimant
or spouse and which funding payments were not excluded from federal adjusted gross
income in the years when the payments were made;
(c) surplus food or other relief in kind supplied by a governmental agency;
(d) relief granted under this chapter;
(e) child support payments received under a temporary or final decree of dissolution
or legal separation; or
(f) restitution payments received by eligible individuals and excludable interest as
defined in section 803 of the Economic Growth and Tax Relief Reconciliation Act of
2001, Public Law 107-16.
(3) The sum of the following amounts may be subtracted from income:
(a) for the claimant's first dependent, the exemption amount multiplied by 1.4;
(b) for the claimant's second dependent, the exemption amount multiplied by 1.3;
(c) for the claimant's third dependent, the exemption amount multiplied by 1.2;
(d) for the claimant's fourth dependent, the exemption amount multiplied by 1.1;
(e) for the claimant's fifth dependent, the exemption amount; and
(f) if the claimant or claimant's spouse was disabled or attained the age of 65 on
or before December 31 of the year for which the taxes were levied or rent paid, the
exemption amount.
For purposes of this subdivision, the "exemption amount" means the exemption
amount under section 151(d) of the Internal Revenue Code for the taxable year for which
the income is reported.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for property tax refunds based on
household income for 2004 and thereafter.
new text end
Sec. 17.
Minnesota Statutes 2004, section 290A.03, subdivision 15, is amended to read:
Subd. 15.
Internal revenue code.
"Internal Revenue Code" means the Internal
Revenue Code of 1986, as amended through deleted text begin June 15, 2003 deleted text end new text begin April 15, 2005new text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for property tax refunds based on
property taxes payable on or after December 31, 2004, and rent paid on or after December
31, 2003.
new text end
ARTICLE 7
SALES AND USE TAXES
Section 1.
Minnesota Statutes 2004, section 16C.03, is amended by adding a
subdivision to read:
new text begin Subd. 18. new text end
new text begin Contracts with foreign vendors. new text end
new text begin
(a) The commissioner and other
agencies to which this section applies and the legislative branch of government shall,
subject to paragraph (d), cancel a contract for goods or services from a vendor or an
affiliate of a vendor or suspend or debar a vendor or an affiliate of a vendor from future
contracts upon notification from the commissioner of revenue that the vendor or an
affiliate of the vendor has not registered to collect the sales and use tax imposed under
chapter 297A on its sales in Minnesota or to a destination in Minnesota. This subdivision
shall not apply to state colleges and universities, the courts, and any agency in the judicial
branch of government. For purposes of this subdivision, the term "affiliate" means any
person or entity that is controlled by, or is under common control of, a vendor through
stock ownership or other affiliation.
new text end
new text begin
(b) Beginning January 1, 2006, each vendor or affiliate of a vendor selling goods or
services, subject to tax under chapter 297A, to an agency or the legislature must provide
its Minnesota sales and use tax business identification number, upon request, to show that
the vendor is registered to collect Minnesota sales or use tax.
new text end
new text begin
(c) The commissioner of revenue shall periodically provide to the commissioner
and the legislative branch a list of vendors who have not registered to collect Minnesota
sales and use tax and who are subject to being suspended or debarred as vendors or having
their contracts canceled.
new text end
new text begin
(d) The provisions of this subdivision may be waived by the commissioner or the
legislative branch when the vendor is the single source of such goods or services, in the
event of an emergency, or when it is in the best interests of the state as determined by the
commissioner in consultation with the commissioner of revenue. Such consultation is not
a disclosure violation under chapter 270B.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for all contracts entered into after
December 31, 2005.
new text end
Sec. 2.
Minnesota Statutes 2004, section 289A.38, subdivision 6, is amended to read:
Subd. 6.
Omission in excess of 25 percent.
Additional taxes may be assessed
within 6-1/2 years after the due date of the return or the date the return was filed,
whichever is later, if:
(1) the taxpayer omits from gross income an amount properly includable in it that is
in excess of 25 percent of the amount of gross income stated in the return;
(2) the taxpayer omits from a salesnew text begin , use,new text end or withholding tax return an amount new text begin of taxes
new text end in excess of 25 percent of the taxes reported in the return; or
(3) the taxpayer omits from the gross estate assets in excess of 25 percent of the
gross estate reported in the return.
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.
Minnesota Statutes 2004, section 289A.38, is amended by adding a subdivision
to read:
new text begin Subd. 15. new text end
new text begin Purchaser filed refund claims. new text end
new text begin
If a purchaser refund claim is filed
under section 289A.50, subdivision 2a, and the basis for the claim is that the purchaser
was improperly charged tax on an improvement to real property or on the purchase of
nontaxable services, sales or use tax may be assessed for the cost of materials used to
make the real property improvement or to perform the nontaxable service. The assessment
may be made against the person making the improvement to real property or the sale of
nontaxable services, within the period prescribed in subdivision 1, or within one year after
the date of the refund order, whichever is later.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for purchaser refund claims filed
on or after July 1, 2005.
new text end
Sec. 4.
Minnesota Statutes 2004, section 289A.40, subdivision 2, is amended to read:
Subd. 2.
Bad debt loss.
If a claim relates to an overpayment because of a failure to
deduct a loss due to a bad debt or to a security becoming worthless, the claim is considered
timely if filed within seven years from the date prescribed for the filing of the return. A
claim relating to an overpayment of taxes under chapter 297A must be filed within 3-1/2
years from the date prescribed for filing the return, plus any extensions granted for filing
the return, but only if filed within the extended time. The refund or credit is limited to
the amount of overpayment attributable to the loss. "Bad debt" for purposes of this
subdivision, has the same meaning as that term is used in United States Code, title 26,
section 166, except that new text begin for a claim relating to an overpayment of taxes under chapter
297A new text end the following are excluded from the calculation of bad debt: financing charges
or interest; sales or use taxes charged on the purchase price; uncollectible amounts on
property that remain in the possession of the seller until the full purchase price is paid;
expenses incurred in attempting to collect any debt; and repossessed property.
new text begin EFFECTIVE DATE. new text end
new text begin
For claims relating to an overpayment of taxes under chapter
297A, this section is effective for sales and purchases made on or after January 1, 2004;
for all other bad debts or claims, this section is effective on or after July 1, 2003.
new text end
Sec. 5.
Minnesota Statutes 2004, section 289A.40, is amended by adding a subdivision
to read:
new text begin Subd. 4. new text end
new text begin Purchaser filed refund claims. new text end
new text begin
A claim for refund of taxes paid on a
transaction not subject to tax under chapter 297A, where the purchaser may apply directly
to the commissioner under section 289A.50, subdivision 2a, must be filed within 3-1/2
years from the 20th day of the month following the month of the invoice date for the
purchase.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for claims filed on or after the day
following final enactment.
new text end
Sec. 6.
Minnesota Statutes 2004, section 289A.40, is amended by adding a subdivision
to read:
new text begin Subd. 5. new text end
new text begin Capital equipment refund claims. new text end
new text begin
A claim for refund for taxes paid
under chapter 297A on capital equipment must be filed within 3-1/2 years from the 20th
day of the month following the month of the invoice date for the purchase of the capital
equipment. A claim for refund for taxes imposed on capital equipment under section
297A.63 must be filed within 3-1/2 years from the date prescribed for filing the return,
or one year from the date of an order assessing tax under section 289A.37, subdivision
1, upon payment in full of the tax, penalties, and interest shown on the order, whichever
period expires later.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for claims filed on or after the day
following final enactment.
new text end
Sec. 7.
Minnesota Statutes 2004, section 297A.61, subdivision 3, is amended to read:
Subd. 3.
Sale and purchase.
(a) "Sale" and "purchase" include, but are not limited
to, each of the transactions listed in this subdivision.
(b) Sale and purchase include:
(1) any transfer of title or possession, or both, of tangible personal property, whether
absolutely or conditionally, for a consideration in money or by exchange or barter; and
(2) the leasing of or the granting of a license to use or consume, for a consideration
in money or by exchange or barter, tangible personal property, other than a manufactured
home used for residential purposes for a continuous period of 30 days or more.
(c) Sale and purchase include the production, fabrication, printing, or processing of
tangible personal property for a consideration for consumers who furnish either directly or
indirectly the materials used in the production, fabrication, printing, or processing.
(d) Sale and purchase include the preparing for a consideration of food.
Notwithstanding section 297A.67, subdivision 2, taxable food includes, but is not limited
to, the following:
(1) prepared food sold by the retailer;
(2) soft drinks;
(3) candy; deleted text begin and
deleted text end
(4) new text begin dietary supplements; and
new text end
new text begin (5) new text end all food sold through vending machinesnew text begin , except milknew text end .
(e) A sale and a purchase includes the furnishing for a consideration of electricity,
gas, water, or steam for use or consumption within this state.
(f) A sale and a purchase includes the transfer for a consideration of prewritten
computer software whether delivered electronically, by load and leave, or otherwise.
(g) A sale and a purchase includes the furnishing for a consideration of the following
services:
(1) the privilege of admission to places of amusement, recreational areas, or athletic
events, and the making available of amusement devices, tanning facilities, reducing
salons, steam baths, turkish baths, health clubs, and spas or athletic facilities;
(2) lodging and related services by a hotel, rooming house, resort, campground,
motel, or trailer camp and the granting of any similar license to use real property new text begin in a
specific facility,new text end other than the renting or leasing of it for a continuous period of 30 days
or more new text begin under an enforceable written agreement that may not be terminated without
prior noticenew text end ;
(3) nonresidential parking services, whether on a contractual, hourly, or other
periodic basis, except for parking at a meter;
(4) the granting of membership in a club, association, or other organization if:
(i) the club, association, or other organization makes available for the use of its
members sports and athletic facilities, without regard to whether a separate charge is
assessed for use of the facilities; and
(ii) use of the sports and athletic facility is not made available to the general public
on the same basis as it is made available to members.
Granting of membership means both onetime initiation fees and periodic membership
dues. Sports and athletic facilities include golf courses; tennis, racquetball, handball, and
squash courts; basketball and volleyball facilities; running tracks; exercise equipment;
swimming pools; and other similar athletic or sports facilities;
(5) delivery of aggregate materials and concrete block by a third party if the delivery
would be subject to the sales tax if provided by the seller of the aggregate material or
concrete block; and
(6) services as provided in this clause:
(i) laundry and dry cleaning services including cleaning, pressing, repairing, altering,
and storing clothes, linen services and supply, cleaning and blocking hats, and carpet,
drapery, upholstery, and industrial cleaning. Laundry and dry cleaning services do not
include services provided by coin operated facilities operated by the customer;
(ii) motor vehicle washing, waxing, and cleaning services, including services
provided by coin operated facilities operated by the customer, and rustproofing,
undercoating, and towing of motor vehicles;
(iii) building and residential cleaning, maintenance, and disinfecting and
exterminating services;
(iv) detective, security, burglar, fire alarm, and armored car services; but not
including services performed within the jurisdiction they serve by off-duty licensed peace
officers as defined in section 626.84, subdivision 1, or services provided by a nonprofit
organization for monitoring and electronic surveillance of persons placed on in-home
detention pursuant to court order or under the direction of the Minnesota Department
of Corrections;
(v) pet grooming services;
(vi) lawn care, fertilizing, mowing, spraying and sprigging services; garden planting
and maintenance; tree, bush, and shrub pruning, bracing, spraying, and surgery; indoor
plant care; tree, bush, shrub, and stump removalnew text begin , except when performed as part of a land
clearing contract as defined in section 297A.68, subdivision 40new text end ; and tree trimming for
public utility lines. Services performed under a construction contract for the installation of
shrubbery, plants, sod, trees, bushes, and similar items are not taxable;
(vii) massages, except when provided by a licensed health care facility or
professional or upon written referral from a licensed health care facility or professional for
treatment of illness, injury, or disease; and
(viii) the furnishing of lodging, board, and care services for animals in kennels and
other similar arrangements, but excluding veterinary and horse boarding services.
In applying the provisions of this chapter, the terms "tangible personal property"
and "sales at retail" include taxable services listed in clause (6), items (i) to (vi) and
(viii), and the provision of these taxable services, unless specifically provided otherwise.
Services performed by an employee for an employer are not taxable. Services performed
by a partnership or association for another partnership or association are not taxable if
one of the entities owns or controls more than 80 percent of the voting power of the
equity interest in the other entity. Services performed between members of an affiliated
group of corporations are not taxable. For purposes of the preceding sentence, "affiliated
group of corporations" includes those entities that would be classified as members of an
affiliated group under United States Code, title 26, section 1504, and that are eligible to
file a consolidated tax return for federal income tax purposes.
(h) A sale and a purchase includes the furnishing for a consideration of tangible
personal property or taxable services by the United States or any of its agencies or
instrumentalities, or the state of Minnesota, its agencies, instrumentalities, or political
subdivisions.
(i) A sale and a purchase includes the furnishing for a consideration of
telecommunications services, including cable television services and direct satellite
services. Telecommunications services are taxed to the extent allowed under federal law.
(j) A sale and a purchase includes the furnishing for a consideration of installation if
the installation charges would be subject to the sales tax if the installation were provided
by the seller of the item being installed.
(k) A sale and a purchase includes the rental of a vehicle by a motor vehicle dealer
to a customer when (1) the vehicle is rented by the customer for a consideration, or (2)
the motor vehicle dealer is reimbursed pursuant to a service contract as defined in section
65B.29, subdivision 1, clause (1).
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment
except that the amendment to paragraph (d), clause (5), is effective for sales made after
June 30, 2005, and the amendment to paragraph (g), clause (6)(vi), is effective for sales
and purchases made after October 28, 2002, but for land clearing contracts entered into
after October 28, 2002, no refunds may be claimed under Minnesota Statutes, section
289A.50, for sales taxes collected and remitted to the state on the land clearing contracts.
new text end
Sec. 8.
Minnesota Statutes 2004, section 297A.61, subdivision 4, is amended to read:
Subd. 4.
Retail sale.
(a) A "retail sale" means any sale, lease, or rental for any
purposenew text begin ,new text end other than resale, sublease, or subrent new text begin of items by the purchaser in the normal
course of business as defined in subdivision 21new text end .
(b) A sale of property used by the owner only by leasing it to others or by holding it
in an effort to lease it, and put to no use by the owner other than resale after the lease or
effort to lease, is a sale of property for resale.
(c) A sale of master computer software that is purchased and used to make copies for
sale or lease is a sale of property for resale.
(d) A sale of building materials, supplies, and equipment to owners, contractors,
subcontractors, or builders for the erection of buildings or the alteration, repair, or
improvement of real property is a retail sale in whatever quantity sold, whether the sale is
for purposes of resale in the form of real property or otherwise.
(e) A sale of carpeting, linoleum, or similar floor covering to a person who provides
for installation of the floor covering is a retail sale and not a sale for resale since a sale
of floor covering which includes installation is a contract for the improvement of real
property.
(f) A sale of shrubbery, plants, sod, trees, and similar items to a person who provides
for installation of the items is a retail sale and not a sale for resale since a sale of
shrubbery, plants, sod, trees, and similar items that includes installation is a contract for
the improvement of real property.
(g) A sale of tangible personal property that is awarded as prizes is a retail sale and
is not considered a sale of property for resale.
(h) A sale of tangible personal property utilized or employed in the furnishing or
providing of services under subdivision 3, paragraph (g), clause (1), including, but not
limited to, property given as promotional items, is a retail sale and is not considered a
sale of property for resale.
(i) A sale of tangible personal property used in conducting lawful gambling under
chapter 349 or the state lottery under chapter 349A, including, but not limited to, property
given as promotional items, is a retail sale and is not considered a sale of property for
resale.
(j) A sale of machines, equipment, or devices that are used to furnish, provide, or
dispense goods or services, including, but not limited to, coin-operated devices, is a retail
sale and is not considered a sale of property for resale.
(k) In the case of a lease, a retail sale occurs new text begin (1) new text end when an obligation to make a lease
payment becomes due under the terms of the agreement or the trade practices of the
lessor new text begin or (2) in the case of a lease of a motor vehicle, as defined in section 297B.01,
subdivision 5, but excluding vehicles with a manufacturer's gross vehicle weight rating
greater than 11,000 pounds and rentals of vehicles for not more than 28 days, at the time
the lease is executednew text end .
(l) In the case of a conditional sales contract, a retail sale occurs upon the transfer of
title or possession of the tangible personal property.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment,
except that the amendments to paragraph (k) are effective for leases entered into after
September 30, 2005.
new text end
Sec. 9.
Minnesota Statutes 2004, section 297A.61, is amended by adding a subdivision
to read:
new text begin Subd. 37. new text end
new text begin Personal rapid transit system. new text end
new text begin
"Personal rapid transit system" means a
transportation system of small, computer-controlled vehicles, transporting one to three
passengers on elevated guideways in a transportation network operating on demand and
nonstop directly to any stations in the network.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for sales and purchases made after
June 30, 2005.
new text end
Sec. 10.
Minnesota Statutes 2004, section 297A.64, subdivision 4, is amended to read:
Subd. 4.
Exemptions.
(a) The tax and the fee imposed by this section do not apply
to a lease or rental of (1) a vehicle to be used by the lessee to provide a licensed taxi
service; (2) a hearse or limousine used in connection with a burial or funeral service; or
(3) a van designed or adapted primarily for transporting property rather than passengers.
new text begin The tax and the fee imposed under this section do not apply when the lease or rental of a
vehicle is exempt from the tax imposed under section 297A.62, subdivision 1.
new text end
(b) The lessor may elect not to charge the fee imposed in subdivision 2 if in the
previous calendar year the lessor had no more than 20 vehicles available for lease that
would have been subject to tax under this section, or no more than $50,000 in gross
receipts that would have been subject to tax under this section.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 11.
Minnesota Statutes 2004, section 297A.668, subdivision 1, is amended to read:
Subdivision 1.
applicability.
The provisions of this section apply regardless of the
characterization of a product as tangible personal property, a digital good, or a service; but
do not apply to telecommunications servicesdeleted text begin ,deleted text end or the sales of motor vehiclesdeleted text begin , watercraft,
aircraft, modular homes, manufactured homes, or mobile homesdeleted text end . These provisions only
apply to determine a seller's obligation to pay or collect and remit a sales or use tax with
respect to the seller's sale of a product. These provisions do not affect the obligation of a
seller as purchaser to remit tax on the use of the product.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 12.
Minnesota Statutes 2004, section 297A.668, subdivision 5, is amended to read:
Subd. 5.
Transportation equipment.
(a) The retail sale, including lease or rental,
of transportation equipment shall be sourced the same as a retail sale in accordance
with the provisions of subdivision 2, notwithstanding the exclusion of lease or rental in
subdivision 2.
(b) "Transportation equipment" means any of the following:
(1) locomotives and railcars that are utilized for the carriage of persons or property
in interstate commerce; deleted text begin and/or
deleted text end
(2) trucks and truck-tractors with a gross vehicle weight rating (GVWR) of 10,001
pounds or greater, trailers, semitrailers, or passenger buses that are:
(i) registered through the international registration plan; and
(ii) operated under authority of a carrier authorized and certified by the United States
Department of Transportation or another federal authority to engage in the carriage of
persons or property in interstate commercenew text begin ;
new text end
new text begin
(3) aircraft that are operated by air carriers authorized and certificated by the United
States Department of Transportation or another federal or a foreign authority to engage in
the carriage of persons or property in interstate commerce; or
new text end
new text begin (4) containers designed for use on and component parts attached or secured on the
transportation equipment described in items (1) through (3)new text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for sales and purchases made on
or after January 1, 2004.
new text end
Sec. 13.
Minnesota Statutes 2004, section 297A.67, subdivision 2, is amended to read:
Subd. 2.
Food and food ingredients.
new text begin Except as otherwise provided in this
subdivision,new text end food and food ingredients are exempt. For purposes of this subdivision, "food"
and "food ingredients" mean substances, whether in liquid, concentrated, solid, frozen,
dried, or dehydrated form, that are sold for ingestion or chewing by humans and are
consumed for their taste or nutritional value. Food and food ingredients exempt under this
subdivision do not include candy, soft drinks, food sold through vending machines, new text begin dietary
supplements,new text end and prepared foods. Food and food ingredients do not include alcoholic
beveragesdeleted text begin , dietary supplements,deleted text end and tobacco. For purposes of this subdivision, "alcoholic
beverages" means beverages that are suitable for human consumption and contain one-half
of one percent or more of alcohol by volume. For purposes of this subdivision, "tobacco"
means cigarettes, cigars, chewing or pipe tobacco, or any other item that contains tobacco.
For purposes of this subdivision, "dietary supplements" means any product, other than
tobacco, intended to supplement the diet that:
(1) contains one or more of the following dietary ingredients:
(i) a vitamin;
(ii) a mineral;
(iii) an herb or other botanical;
(iv) an amino acid;
(v) a dietary substance for use by humans to supplement the diet by increasing the
total dietary intake; and
(vi) a concentrate, metabolite, constituent, extract, or combination of any ingredient
described in items (i) to (v);
(2) is intended for ingestion in tablet, capsule, powder, softgel, gelcap, or liquid
form, or if not intended for ingestion in such form, is not represented as conventional food
and is not represented for use as a sole item of a meal or of the diet; and
(3) is required to be labeled as a dietary supplement, identifiable by the supplement
facts box found on the label and as required pursuant to Code of Federal Regulations,
title 21, section 101.36.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for sales made on or after the day
following final enactment.
new text end
Sec. 14.
Minnesota Statutes 2004, section 297A.67, subdivision 7, is amended to read:
Subd. 7.
deleted text begin medicines deleted text end new text begin drugsnew text end ; medical devices.
(a) deleted text begin Prescribed deleted text end new text begin Sales of the following
drugs and medical devices are exempt:
new text end
new text begin (1) new text end drugs deleted text begin and medicine, and insulin, intended deleted text end for deleted text begin internal or external use, in the
cure, mitigation, treatment, or prevention of illness or disease in deleted text end human deleted text begin beings are
exempt. "Prescribed drugs and medicine" includes deleted text end new text begin use, including new text end over-the-counter drugs
deleted text begin or medicine prescribed by a licensed health care professional.
deleted text end
deleted text begin
(b) Nonprescription medicines consisting principally (determined by the weight
of all ingredients) of analgesics that are approved by the United States Food and Drug
Administration for internal use by human beings are exempt. For purposes of this
subdivision, "principally" means greater than 50 percent analgesics by weight.
deleted text end
deleted text begin
(c) Prescription glasses, hospital beds, fever thermometers, reusable
deleted text end
new text begin
;
new text end
new text begin (2) single-use new text end finger-pricking devices for the extraction of blooddeleted text begin , blood glucose
monitoring machines,deleted text end and other new text begin single-use devices and single-use new text end diagnostic agents used
in diagnosing, monitoring, or treating diabetesdeleted text begin , and therapeutic and deleted text end new text begin ;
new text end
new text begin
(3) insulin and medical oxygen for human use, regardless of whether prescribed
or sold over the counter;
new text end
new text begin (4) new text end prosthetic devices deleted text begin are exempt. "Therapeutic devices" means devices that are
attached or applied to the human body to cure, heal, or alleviate injury, illness, or disease,
either directly or by administering a curative agent. "Prosthetic devices" means devices
that replace injured, diseased, or missing parts of the human body, either temporarily or
permanently deleted text end new text begin ;
new text end
new text begin
(5) durable medical equipment for home use only;
new text end
new text begin
(6) mobility enhancing equipment; and
new text end
new text begin (7) prescription corrective eyeglassesnew text end .
new text begin
(b) For purposes of this subdivision:
new text end
new text begin
(1) "Drug" means a compound, substance, or preparation, and any component of
a compound, substance, or preparation, other than food and food ingredients, dietary
supplements, or alcoholic beverages that is:
new text end
new text begin
(i) recognized in the official United States Pharmacopoeia, official Homeopathic
Pharmacopoeia of the United States, or official National Formulary, and supplement
to any of them;
new text end
new text begin
(ii) intended for use in the diagnosis, cure, mitigation, treatment, or prevention
of disease; or
new text end
new text begin
(iii) intended to affect the structure or any function of the body.
new text end
new text begin
(2) "Durable medical equipment" means equipment, including repair and
replacement parts, but not including mobility enhancing equipment, that:
new text end
new text begin
(i) can withstand repeated use;
new text end
new text begin
(ii) is primarily and customarily used to serve a medical purpose;
new text end
new text begin
(iii) generally is not useful to a person in the absence of illness or injury; and
new text end
new text begin
(iv) is not worn in or on the body.
new text end
new text begin
(3) "Mobility enhancing equipment" means equipment, including repair and
replacement parts, but not including durable medical equipment, that:
new text end
new text begin
(i) is primarily and customarily used to provide or increase the ability to move from
one place to another and that is appropriate for use either in a home or a motor vehicle;
new text end
new text begin
(ii) is not generally used by persons with normal mobility; and
new text end
new text begin
(iii) does not include any motor vehicle or equipment on a motor vehicle normally
provided by a motor vehicle manufacturer.
new text end
new text begin
(4) "Over-the-counter drug" means a drug that contains a label that identifies the
product as a drug as required by Code of Federal Regulations, title 21, section 201.66. The
label must include a "drug facts" panel or a statement of the active ingredients with a list of
those ingredients contained in the compound, substance, or preparation. Over-the-counter
drugs do not include grooming and hygiene products, regardless of whether they otherwise
meet the definition. "Grooming and hygiene products" are soaps, cleaning solutions,
shampoo, toothpaste, mouthwash, antiperspirants, and suntan lotions and sunscreens.
new text end
new text begin
(5) "Prescribed" and "prescription" means a direction in the form of an order,
formula, or recipe issued in any form of oral, written, electronic, or other means of
transmission by a duly licensed health care professional.
new text end
new text begin
(6) "Prosthetic device" means a replacement, corrective, or supportive device,
including repair and replacement parts, worn on or in the body to:
new text end
new text begin
(i) artificially replace a missing portion of the body;
new text end
new text begin
(ii) prevent or correct physical deformity or malfunction; or
new text end
new text begin
(iii) support a weak or deformed portion of the body.
new text end
new text begin
Prosthetic device does not include corrective eyeglasses.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for sales and purchases made after
June 30, 2005.
new text end
Sec. 15.
Minnesota Statutes 2004, section 297A.67, subdivision 9, is amended to read:
Subd. 9.
Baby products.
deleted text begin
(a) Products such as lotion, creams, ointments, oil,
powder, or shampoo, and other articles designed for application to the hair or skin of
babies are exempt.
deleted text end
deleted text begin (b) deleted text end Baby bottles and nipples, pacifiers, teething rings,deleted text begin thumb sucking
preventatives,deleted text end and infant syringes are exempt.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for sales and purchases made after
June 30, 2005.
new text end
Sec. 16.
Minnesota Statutes 2004, section 297A.67, subdivision 29, is amended to read:
Subd. 29.
new text begin solar new text end energy deleted text begin efficient deleted text end products.
deleted text begin
(a) A residential lighting fixture or a
compact fluorescent bulb is exempt if it has an energy star label.
deleted text end
deleted text begin
(b) The following products are exempt if they have an energyguide label that
indicates that the product meets or exceeds the standards listed below:
deleted text end
deleted text begin
(1) an electric heat pump hot water heater with an energy factor of at least 1.9;
deleted text end
deleted text begin
(2) a natural gas water heater with an energy factor of at least 0.62;
deleted text end
deleted text begin
(3) a propane gas or fuel oil water heater with an energy factor of at least 0.62;
deleted text end
deleted text begin
(4) a natural gas furnace with an annual fuel utilization efficiency greater than 92
percent; and
deleted text end
deleted text begin
(5) a propane gas or fuel oil furnace with an annual fuel utilization efficiency
greater than 92 percent.
deleted text end
deleted text begin (c) deleted text end A deleted text begin photovoltaic device deleted text end new text begin solar energy system, as defined in section 216C.06,
subdivision 17,new text end is exempt. deleted text begin For purposes of this subdivision, "photovoltaic device" means
a solid-state electrical device, such as a solar module, that converts light directly into
direct current electricity of voltage-current characteristics that are a function of the
characteristics of the light source and the materials in and design of the device. A "solar
module" is a photovoltaic device that produces a specified power output under defined test
conditions, usually composed of groups of solar cells connected in series, in parallel, or
in series-parallel combinations.
deleted text end
deleted text begin
(d) For purposes of this subdivision, "energy star label" means the label granted
to certain products that meet United States Environmental Protection Agency and
United States Department of Energy criteria for energy efficiency. For purposes of this
subdivision, "energyguide label" means the label that the United States Federal Trade
Commissioner requires manufacturers to apply to certain appliances under United States
Code, title 16, part 305.
deleted text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for sales and purchases made on
or after August 1, 2005.
new text end
Sec. 17.
Minnesota Statutes 2004, section 297A.67, is amended by adding a
subdivision to read:
new text begin Subd. 32. new text end
new text begin Cigarettes. new text end
new text begin
Cigarettes upon which a tax has been imposed under section
297F.25 are exempt.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for sales and purchases made after
July 31, 2005.
new text end
Sec. 18.
Minnesota Statutes 2004, section 297A.68, subdivision 2, is amended to read:
Subd. 2.
Materials consumed in industrial production.
(a) Materials stored, used,
or consumed in industrial production of personal property intended to be sold ultimately at
retail are exempt, whether or not the item so used becomes an ingredient or constituent
part of the property produced. Materials that qualify for this exemption include, but
are not limited to, the following:
(1) chemicals, including chemicals used for cleaning food processing machinery
and equipment;
(2) materials, including chemicals, fuels, and electricity purchased by persons
engaged in industrial production to treat waste generated as a result of the production
process;
(3) fuels, electricity, gas, and steam used or consumed in the production process,
except that electricity, gas, or steam used for space heating, cooling, or lighting is exempt
if (i) it is in excess of the average climate control or lighting for the production area, and
(ii) it is necessary to produce that particular product;
(4) petroleum products and lubricants;
(5) packaging materials, including returnable containers used in packaging food
and beverage products;
(6) accessory tools, equipment, and other items that are separate detachable units
with an ordinary useful life of less than 12 months used in producing a direct effect upon
the product; and
(7) the following materials, tools, and equipment used in metalcasting: crucibles,
thermocouple protection sheaths and tubes, stalk tubes, refractory materials, molten metal
filters and filter boxes, degassing lances, and base blocks.
(b) This exemption does not include:
(1) machinery, equipment, implements, tools, accessories, appliances, contrivances
and furniture and fixtures, except those listed in paragraph (a), clause (6); and
(2) petroleum and special fuels used in producing or generating power for propelling
ready-mixed concrete trucks on the public highways of this state.
(c) Industrial production includes, but is not limited to, research, development,
design or production of any tangible personal property, manufacturing, processing (other
than by restaurants and consumers) of agricultural products (whether vegetable or animal),
commercial fishing, refining, smelting, reducing, brewing, distilling, printing, mining,
quarrying, lumbering, generating electricity, the production of road building materials,
and the research, development, design, or production of computer software. Industrial
production does not include painting, cleaning, repairing or similar processing of property
except as part of the original manufacturing process.
new text begin
(d) Industrial production does not include:
new text end
new text begin
(1) the furnishing of services listed in section 297A.61, subdivision 3, paragraph (g),
clause (6), items (i) to (vi) and (viii); or
new text end
new text begin
(2) the transportation, transmission, or distribution of petroleum, liquefied gas,
natural gas, water, or steam, in, by, or through pipes, lines, tanks, mains, or other means of
transporting those products. For purposes of this paragraph, "transportation, transmission,
or distribution" does not include blending of petroleum or biodiesel fuel as defined
in section 239.77.
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 the provision in paragraph (d) is effective for sales and purchases made after
June 30, 2005.
new text end
Sec. 19.
Minnesota Statutes 2004, section 297A.68, subdivision 5, is amended to read:
Subd. 5.
Capital equipment.
(a) Capital equipment is exempt. The tax must be
imposed and collected as if the rate under section 297A.62, subdivision 1, applied, and
then refunded in the manner provided in section 297A.75new text begin , unless:
new text end
new text begin
(1) the purchaser qualifies as a small business as defined in section 645.445,
subdivision 2, paragraphs (a) to (c);
new text end
new text begin
(2) the business is located in the state; and
new text end
new text begin (3) the purchaser provides an exemption certificate as required in section 297A.72,
subdivision 3new text end .
"Capital equipment" means machinery and equipment purchased or leased, and used
in this state by the purchaser or lessee primarily for manufacturing, fabricating, mining,
or refining tangible personal property to be sold ultimately at retail if the machinery and
equipment are essential to the integrated production process of manufacturing, fabricating,
mining, or refining. Capital equipment also includes machinery and equipment used
new text begin primarily new text end to electronically transmit results retrieved by a customer of an on-line
computerized data retrieval system.
(b) Capital equipment includes, but is not limited to:
(1) machinery and equipment used to operate, control, or regulate the production
equipment;
(2) machinery and equipment used for research and development, design, quality
control, and testing activities;
(3) environmental control devices that are used to maintain conditions such as
temperature, humidity, light, or air pressure when those conditions are essential to and are
part of the production process;
(4) materials and supplies used to construct and install machinery or equipment;
(5) repair and replacement parts, including accessories, whether purchased as spare
parts, repair parts, or as upgrades or modifications to machinery or equipment;
(6) materials used for foundations that support machinery or equipment;
(7) materials used to construct and install special purpose buildings used in the
production process;
(8) ready-mixed concrete equipment in which the ready-mixed concrete is mixed
as part of the delivery process regardless if mounted on a chassisnew text begin , repair parts for
ready-mixed concrete trucks,new text end and leases of ready-mixed concrete trucks; and
(9) machinery or equipment used for research, development, design, or production
of computer software.
(c) Capital equipment does not include the following:
(1) motor vehicles taxed under chapter 297B;
(2) machinery or equipment used to receive or store raw materials;
(3) building materials, except for materials included in paragraph (b), clauses (6)
and (7);
(4) machinery or equipment used for nonproduction purposes, including, but not
limited to, the following: plant security, fire prevention, first aid, and hospital stations;
support operations or administration; pollution control; and plant cleaning, disposal of
scrap and waste, plant communications, space heating, cooling, lighting, or safety;
(5) farm machinery and aquaculture production equipment as defined by section
297A.61, subdivisions 12 and 13;
(6) machinery or equipment purchased and installed by a contractor as part of an
improvement to real property; deleted text begin or
deleted text end
(7) new text begin machinery and equipment used by restaurants in the furnishing, preparing, or
serving of prepared foods as defined in section 297A.61, subdivision 31;
new text end
new text begin
(8) machinery and equipment used to furnish the services listed in section 297A.61,
subdivision 3, paragraph (g), clause (6), items (i) to (vi) and (viii);
new text end
new text begin
(9) machinery or equipment used in the transportation, transmission, or distribution
of petroleum, liquefied gas, natural gas, water, or steam, in, by, or through pipes, lines,
tanks, mains, or other means of transporting those products. This clause does not apply to
machinery or equipment used to blend petroleum or biodiesel fuel as defined in section
239.77; or
new text end
new text begin (10) new text end any other item that is not essential to the integrated process of manufacturing,
fabricating, mining, or refining.
(d) For purposes of this subdivision:
(1) "Equipment" means independent devices or tools separate from machinery but
essential to an integrated production process, including computers and computer software,
used in operating, controlling, or regulating machinery and equipment; and any subunit or
assembly comprising a component of any machinery or accessory or attachment parts of
machinery, such as tools, dies, jigs, patterns, and molds.
(2) "Fabricating" means to make, build, create, produce, or assemble components or
property to work in a new or different manner.
(3) "Integrated production process" means a process or series of operations through
which tangible personal property is manufactured, fabricated, mined, or refined. For
purposes of this clause, (i) manufacturing begins with the removal of raw materials
from inventory and ends when the last process prior to loading for shipment has been
completed; (ii) fabricating begins with the removal from storage or inventory of the
property to be assembled, processed, altered, or modified and ends with the creation
or production of the new or changed product; (iii) mining begins with the removal of
overburden from the site of the ores, minerals, stone, peat deposit, or surface materials and
ends when the last process before stockpiling is completed; and (iv) refining begins with
the removal from inventory or storage of a natural resource and ends with the conversion
of the item to its completed form.
(4) "Machinery" means mechanical, electronic, or electrical devices, including
computers and computer software, that are purchased or constructed to be used for the
activities set forth in paragraph (a), beginning with the removal of raw materials from
inventory through completion of the product, including packaging of the product.
(5) "Machinery and equipment used for pollution control" means machinery and
equipment used solely to eliminate, prevent, or reduce pollution resulting from an activity
described in paragraph (a).
(6) "Manufacturing" means an operation or series of operations where raw materials
are changed in form, composition, or condition by machinery and equipment and which
results in the production of a new article of tangible personal property. For purposes of
this subdivision, "manufacturing" includes the generation of electricity or steam to be
sold at retail.
(7) "Mining" means the extraction of minerals, ores, stone, or peat.
(8) "On-line data retrieval system" means a system whose cumulation of information
is equally available and accessible to all its customers.
(9) "Primarily" means machinery and equipment used 50 percent or more of the time
in an activity described in paragraph (a).
(10) "Refining" means the process of converting a natural resource to an intermediate
or finished product, including the treatment of water to be sold at retail.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment,
except that the second sentence in paragraph (a) is effective for sales and purchases made
after December 31, 2005, and paragraph (c), clause (9), is effective for sales and purchases
made after June 30, 2005.
new text end
Sec. 20.
Minnesota Statutes 2004, section 297A.68, subdivision 28, is amended to read:
Subd. 28.
Medical supplies.
Medical supplies purchased by a licensed health care
facility or licensed health care professional to provide medical treatment to residents or
patients are exempt. The exemption does not apply to new text begin durable new text end medical equipment or
components of new text begin durable new text end medical equipment, laboratory supplies, radiological supplies, and
other items used in providing medical services. For purposes of this subdivision, "medical
supplies" means adhesive and nonadhesive bandages, gauze pads and strips, cotton
applicators, antiseptics, deleted text begin nonprescription drugs,deleted text end eye solution, and other similar supplies
used directly on the resident or patient in providing medical services.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for sales and purchases made after
June 30, 2005.
new text end
Sec. 21.
Minnesota Statutes 2004, section 297A.68, subdivision 35, is amended to read:
Subd. 35.
Telecommunications equipment.
(a) Telecommunications machinery
and equipment purchased or leased for use directly by a telecommunications service
provider primarily in the provision of telecommunications services that are ultimately to
be sold at retail are exempt, regardless of whether purchased by the owner, a contractor,
or a subcontractor.
(b) For purposes of this subdivision, "telecommunications machinery and
equipment" includes, but is not limited to:
(1) machinery, equipment, and fixtures utilized in receiving, initiating,
amplifying, processing, transmitting, retransmitting, recording, switching, or monitoring
telecommunications services, such as computers, transformers, amplifiers, routers,
bridges, repeaters, multiplexers, and other items performing comparable functions;
(2) machinery, equipment, and fixtures used in the transportation of
telecommunications services, radio transmitters and receivers, satellite equipment,
microwave equipment, and other transporting media, but not wire, cable, fiber, poles,
or conduit;
(3) ancillary machinery, equipment, and fixtures that regulate, control, protect, or
enable the machinery in clauses (1) and (2) to accomplish its intended function, such as
auxiliary power supply, test equipment, towers, heating, ventilating, and air conditioning
equipment necessary to the operation of the telecommunications equipment; and software
necessary to the operation of the telecommunications equipment; and
(4) repair and replacement parts, including accessories, whether purchased as spare
parts, repair parts, or as upgrades or modifications to qualified machinery or equipment.
(c) For purposes of this subdivision, "telecommunications services" means
telecommunications services as defined in section 297A.61, subdivision 24, deleted text begin paragraph
deleted text end new text begin paragraphs new text end (a), deleted text begin only deleted text end new text begin (c), and (d)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. 22.
Minnesota Statutes 2004, section 297A.68, subdivision 39, is amended to read:
Subd. 39.
Preexisting bids or contracts.
(a) The sale of tangible personal property
or services is exempt from tax new text begin or a tax rate increase new text end for a period of six months from
the effective date of the law change that results in the imposition of the taxnew text begin or the tax
rate increase new text end under this chapter if:
(1) the act imposing the tax new text begin or increasing the tax rate new text end does not have transitional
effective date language for existing construction contracts and construction bids; and
(2) the requirements of paragraph (b) are met.
(b) A sale is tax exempt under paragraph (a) if it meets the requirements of either
clause (1) or (2):
(1) For a construction contract:
(i) the goods or services sold must be used for the performance of a bona fide written
lump sum or fixed price construction contract;
(ii) the contract must be entered into before the date the goods or services become
subject to the sales tax new text begin or the tax rate was increasednew text end ;
(iii) the contract must not provide for allocation of future taxes; and
(iv) for each qualifying contract the contractor must give the seller documentation
of the contract on which an exemption is to be claimed.
(2) For a new text begin construction new text end bid:
(i) the goods or services sold must be used pursuant to an obligation of a bid or bids;
(ii) the bid or bids must be submitted and accepted before the date the goods or
services became subject to the sales tax new text begin or the tax rate was increasednew text end ;
(iii) the bid or bids must not be able to be withdrawn, modified, or changed without
forfeiting a bond; and
(iv) for each qualifying bid, the contractor must give the seller documentation of the
bid on which an exemption is to be claimed.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 23.
Minnesota Statutes 2004, section 297A.68, is amended by adding a
subdivision to read:
new text begin Subd. 40. new text end
new text begin Land clearing. new text end
new text begin
Tree, bush, shrub, and stump removal are exempt when
sold to contractors or subcontractors as part of a land clearing contract. For purposes
of this subdivision, "land clearing contract" means a contract for the removal of trees,
bushes, and shrubs, including the removal of roots and stumps, to develop a site. This
exemption does not apply to land clearing of a portion of a site to allow for remodeling,
improvement, or expansion of an existing structure.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for sales and purchases made after
October 28, 2002, but for land clearing contracts entered into after October 28, 2002,
no refunds may be claimed under Minnesota Statutes, section 289A.50, for sales taxes
collected and remitted to the state on the land clearing contracts.
new text end
Sec. 24.
Minnesota Statutes 2004, section 297A.68, is amended by adding a
subdivision to read:
new text begin Subd. 41. new text end
new text begin Personal rapid transit system. new text end
new text begin
(a) Machinery, equipment, and supplies
purchased or leased, and used by the purchaser or lessee in this state directly in the
provision of a personal rapid transit system as defined in section 297A.61, subdivision
37, which provides service to the public on a regular and continuing basis, are exempt,
provided that the system is operated independent of any government subsidies. Machinery,
equipment, and supplies that qualify for this exemption include, but are not limited to,
the following:
new text end
new text begin
(1) vehicles, guideways, and related parts used directly in the transit system;
new text end
new text begin
(2) computers and equipment used primarily for operating, controlling, and
regulating the system;
new text end
new text begin
(3) machinery, equipment, furniture, and fixtures necessary for the functioning
of system stations;
new text end
new text begin
(4) machinery, equipment, implements, tools, and supplies used to maintain vehicles,
guideways, and stations; and
new text end
new text begin
(5) electricity and other fuels used in the provision of the transit service, including
heating, cooling, and lighting of system stations.
new text end
new text begin
(b) This exemption does not include machinery, equipment, and supplies used for
nonproduction purposes such as operations support and administration.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for sales and purchases made after
June 30, 2005.
new text end
Sec. 25.
Minnesota Statutes 2004, section 297A.70, subdivision 10, is amended to read:
Subd. 10.
Nonprofit tickets or admissions.
(a) Tickets or admissions to an event
are exempt if all the gross receipts are recorded as such, in accordance with generally
accepted accounting principles, on the books of one or more organizations whose primary
mission is to provide an opportunity for citizens of the state to participate in the creation,
performance, or appreciation of the arts, and provided that each organization is:
(1) an organization described in section 501(c)(3) of the Internal Revenue Code in
which voluntary contributions make up at least the following percent of the organization's
annual revenue in its most recently completed 12-month fiscal year, or in the current year
if the organization has not completed a 12-month fiscal year:
(i) for sales made after July 31, 2001, and before July 1, 2002, for the organization's
fiscal year completed in calendar year 2000, three percent;
(ii) for sales made on or after July 1, 2002, and on or before June 30, 2003, for the
organization's fiscal year completed in calendar year 2001, three percent;
(iii) for sales made on or after July 1, 2003, and on or before June 30, 2004, for the
organization's fiscal year completed in calendar year 2002, four percent; and
(iv) for sales made in each 12-month period, beginning on July 1, 2004, and each
subsequent year, for the organization's fiscal year completed in the preceding calendar
year, five percent;
(2) a municipal board that promotes cultural and arts activities; or
(3) the University of Minnesota, new text begin a state college and university, or a private nonprofit
college or university new text end provided that the event is held at a deleted text begin university-owned deleted text end facilitynew text begin owned
by the educational institution holding the eventnew text end .
The exemption only applies if the entire proceeds, after reasonable expenses, are used
solely to provide opportunities for citizens of the state to participate in the creation,
performance, or appreciation of the arts.
(b) Tickets or admissions to the premises of the Minnesota Zoological Garden are
exempt, provided that the exemption under this paragraph does not apply to tickets or
admissions to performances or events held on the premises unless the performance or
event is sponsored and conducted exclusively by the Minnesota Zoological Board or
employees of the Minnesota Zoological Garden.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tickets and admissions to events
held on or after July 1, 2005, but does not apply to events for which sales of tickets or
admissions were made prior to July 1, 2005.
new text end
Sec. 26.
Minnesota Statutes 2004, section 297A.71, subdivision 12, is amended to read:
Subd. 12.
Chair lifts, ramps, elevators.
deleted text begin Chair lifts, ramps, and deleted text end Elevators and
building materials used to install or construct deleted text begin them deleted text end new text begin chair lifts, ramps, and elevators new text end are
exempt, if they are authorized by a physician and installed in or attached to the owner's
homestead. The tax must be imposed and collected as if the rate under section 297A.62,
subdivision 1, applied and then refunded in the manner provided in section 297A.75.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for sales and purchases made after
June 30, 2005.
new text end
Sec. 27.
Minnesota Statutes 2004, section 297A.71, is amended by adding a
subdivision to read:
new text begin Subd. 33. new text end
new text begin Personal rapid transit system. new text end
new text begin
Materials, equipment, and supplies
used in the construction, expansion, or improvement of a personal rapid transit system
as defined in section 297A.61, subdivision 37, which provides service to the public on a
regular and continuing basis, are exempt, provided that the system is operated independent
of any government subsidies.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for sales and purchases made after
June 30, 2005.
new text end
Sec. 28.
Minnesota Statutes 2004, section 297A.72, is amended by adding a
subdivision to read:
new text begin Subd. 3. new text end
new text begin Exemption certificate for small businesses. new text end
new text begin
A small business, as defined
in section 645.455, subdivision 2, paragraphs (a) to (c), that is located in the state may
apply to the commissioner for an exemption certificate to purchase exempt capital
equipment without paying the sales tax at the time of the sale. The business must provide
information required by the commissioner to verify that it meets the definition of small
business in the preceding calendar year, or in the case of a new business, that it will meet
the definition in the first full year of operations. A decision by the commissioner on
whether a business qualifies for this exemption is final. The exemption certificate must
be in the form and meet the requirements imposed under this chapter and chapter 289A
on other sales and use tax exemption certificates, but it shall only be in effect for two
years from the date of issuance.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for applications submitted to the
commissioner of revenue after July 1, 2005.
new text end
Sec. 29.
Minnesota Statutes 2004, section 297A.75, subdivision 1, is amended to read:
Subdivision 1.
Tax collected.
The tax on the gross receipts from the sale of the
following exempt items must be imposed and collected as if the sale were taxable and the
rate under section 297A.62, subdivision 1, applied. The exempt items include:
(1) capital equipment exempt under section 297A.68, subdivision 5;
(2) building materials for an agricultural processing facility exempt under section
297A.71, subdivision 13;
(3) building materials for mineral production facilities exempt under section
297A.71, subdivision 14;
(4) building materials for correctional facilities under section 297A.71, subdivision
3;
(5) building materials used in a residence for disabled veterans exempt under section
297A.71, subdivision 11;
(6) deleted text begin chair lifts, ramps,deleted text end elevatorsdeleted text begin ,deleted text end and deleted text begin associated deleted text end building materials exempt under
section 297A.71, subdivision 12;
(7) building materials for the Long Lake Conservation Center exempt under section
297A.71, subdivision 17;
(8) materials, supplies, fixtures, furnishings, and equipment for a county law
enforcement and family service center under section 297A.71, subdivision 26; and
(9) materials and supplies for qualified low-income housing under section 297A.71,
subdivision 23.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for sales and purchases made after
June 30, 2005.
new text end
Sec. 30.
new text begin
[297A.82] MOTOR VEHICLE LEASES.
new text end
new text begin Subdivision 1. new text end
new text begin Motor vehicle lease price; payment. new text end
new text begin
(a) In the case of a lease of a
motor vehicle as provided in section 297A.61, subdivision 4, paragraph (k), clause (2), the
tax is imposed on the total amount to be paid by the lessee under the lease agreement. The
lessor shall collect the tax in full at the time the lease is executed or, if the tax is included
in the lease and the lease is assigned, the tax is due from the original lessor at the time the
lease is assigned. The total amount to be paid by the lessee under the lease agreement
equals the agreed-upon value of the vehicle less manufacturer's rebates, the stated residual
value of the leased vehicle, and the total value allowed for a vehicle owned by the lessee
taken in trade by the lessor, plus the price of any taxable goods and services included in
the lease and the rent charge as provided by Code of Federal Regulations, title 12, section
213.4, excluding any rent charge related to the capitalization of the tax.
new text end
new text begin
(b) If the total amount paid by the lessee for use of the leased vehicle includes
amounts that are not calculated at the time the lease is executed, the tax is imposed and
must be collected by the lessor at the time the amounts are paid by the lessee. In the case
of a lease which by its terms may be renewed, the sales tax is due and payable on the
total amount to be paid during the initial term of the lease, and then for each subsequent
renewal period on the total amount to be paid during the renewal period.
new text end
new text begin
(c) If a lease is canceled or rescinded on or before 90 days of its execution or if a
vehicle is returned to the manufacturer under section 325F.665, the lessor may file a claim
for a refund of the total tax paid minus the amount of tax due for the period the vehicle is
used by the lessee.
new text end
new text begin
(d) If a lessee's obligation to make payments on a lease is canceled more than 90 days
after its execution, a credit is allowed against sales tax or motor vehicles sales tax due on a
subsequent lease or purchase of a motor vehicle if that lease or purchase is consummated
within 30 days of the date the prior lease was canceled. The amount of the credit is equal
to (1) the sales tax paid at the inception of the lease, multiplied by (2) the ratio of the
number of full months remaining in the lease at the time of termination compared to the
term of the lease used in calculating sales tax paid at the inception of the lease.
new text end
new text begin Subd. 2. new text end
new text begin Lease originating in another state. new text end
new text begin
When the lease of a motor vehicle
as defined in section 297A.61, subdivision 4, paragraph (k), clause (2), originates in
another state, the sales tax under subdivision 1 shall be calculated by the lessor on the total
amount that is due under the lease agreement after the vehicle is required to be registered
in Minnesota. If the total amount to be paid by the lessee under the lease agreement has
already been subjected to tax by another state, a credit for taxes paid in the other state is
allowed as provided in section 297A.80.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
Subdivision 1 of this section is effective for leases entered
into after September 30, 2005. Subdivision 2 of this section is effective for vehicles
registering in Minnesota after September 30, 2005.
new text end
Sec. 31.
Minnesota Statutes 2004, section 297A.87, subdivision 2, is amended to read:
Subd. 2.
Seller's permit or alternate statement.
(a) The operator of an event
under subdivision 1 shall obtain one of the following from a person who wishes to do
business as a seller at the event:
(1) evidence that the person holds a valid seller's permit under section 297A.84; deleted text begin or
deleted text end
(2) a written statement that the person is not offering for sale any item that is taxable
under this chapternew text begin ; or
new text end
new text begin (3) a written statement that this is the only selling event that the person will be
participating in for that calendar year, that the person will be participating for three or
fewer days, and that the person will make less than $500 in total sales at the event. The
written statement shall include the person's name, address, and telephone numbernew text end .
(b) The operator shall require the evidence or statement as a prerequisite to
participating in the event as a seller.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for selling events occurring after
June 15, 2005.
new text end
Sec. 32.
Minnesota Statutes 2004, section 297A.87, subdivision 3, is amended to read:
Subd. 3.
Occasional sale provisions deleted text begin not deleted text end applicable new text begin under limited circumstancesnew text end .
The isolated and occasional sale deleted text begin provisions deleted text end new text begin provision new text end under section 297A.67, subdivision
23,deleted text begin or deleted text end new text begin applies, provided that the seller only participates for three or fewer days in one
event per calendar year, makes $500 or less in sales at the event, and provides the written
statement required in subdivision 2, paragraph (a), clause (3). The isolated and occasional
sales provision new text end under section 297A.68, subdivision 25, deleted text begin do deleted text end new text begin does new text end not apply to a seller at an
event under this section.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for selling events occurring after
June 15, 2005.
new text end
Sec. 33.
new text begin
[297A.981] LOCAL SALES TAXES; CERTAIN CITIES OF THE FIRST
CLASS.
new text end
new text begin Subdivision 1. new text end
new text begin General authority; certain cities. new text end
new text begin
(a) Notwithstanding sections
297A.99 and 477A.016, or any other contrary provision of law, ordinance, or charter, a
city of the first class located in the seven-county metropolitan area may impose a local
sales tax of one-half of one percent on sale transactions taxable under this chapter that
occur within the city. The tax base is the same as defined in section 297A.99, subdivision
4. This tax is in addition to any other local sales tax imposed under other general or
special law and must not be included when calculating sales tax limits imposed under
other law, ordinance, or charter.
new text end
new text begin Subd. 2. new text end
new text begin Use tax. new text end
new text begin
If the city imposes the tax authorized in subdivision 1, a
compensating use tax also applies, at the same rate as the sales tax, on the use, storage,
distribution, or consumption of tangible personal property or taxable services.
new text end
new text begin Subd. 3. new text end
new text begin Use of revenues. new text end
new text begin
(a) Revenues received from taxes imposed under
subdivisions 1 and 2, minus the reasonable costs of collection, may be used by the city for
any purpose for which the city is authorized to make expenditures.
new text end
new text begin Subd. 4. new text end
new text begin Collection; enforcement; administration. new text end
new text begin
A tax imposed under this
section shall be administered, collected, and enforced by the commissioner of revenue
as provided for under section 297A.99, subdivision 9. The commissioner shall remit the
proceeds, minus refunds and the costs of collection, as provided for in section 297A.99,
subdivision 11.
new text end
new text begin Subd. 5new text end . [LOCAL APPROVAL.] new text begin The question of imposing the local sales tax
must be submitted to the voters at a general or a special election held for this purpose.
If the majority of the votes cast on the question are in the affirmative, the tax shall be
imposed on the first day of the next calendar quarter beginning at least 30 days after
the day of local approval.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective July 1, 2005.
new text end
Sec. 34.
Minnesota Statutes 2004, section 297A.99, subdivision 1, is amended to read:
Subdivision 1.
Authorization; scope.
(a) A political subdivision of this state may
impose a general sales tax if permitted by special law or if the political subdivision enacted
and imposed the tax before the effective date of section 477A.016 and its predecessor
provisionnew text begin , or if the tax is allowed under section 297A.981 or subdivision 1anew text end .
(b) This section governs the imposition of a general sales tax by the political
subdivision. The provisions of this section preempt the provisions of any special law:
(1) enacted before June 2, 1997, or
(2) enacted on or after June 2, 1997, that does not explicitly exempt the special law
provision from this section's rules by reference.
(c) This section does not apply to or preempt a sales tax on motor vehicles or a
special excise tax on motor vehicles.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for local sales taxes for which the
authorizing referendum is held after June 30, 2005.
new text end
Sec. 35.
Minnesota Statutes 2004, section 297A.99, is amended by adding a
subdivision to read:
new text begin Subd. 1a. new text end
new text begin General authority; certain cities. new text end
new text begin
(a) A city or a group of cities acting
under a joint powers agreement, may impose a local sales tax of one-half of one percent
without authorization under a special law provided that:
new text end
new text begin
(1) the city or cities are located outside of the metropolitan counties, as defined in
section 473.121, subdivision 4;
new text end
new text begin
(2) imposition of the tax is approved by the voters of each city pursuant to
subdivision 3, paragraph (a);
new text end
new text begin
(3) all the conditions for adoption, use, and termination of the tax contained in this
subdivision and subdivisions 3 to 12 are met;
new text end
new text begin
(4) if the tax is imposed by a group of cities, the cities shall be within five miles
of each other; and
new text end
new text begin
(5) imposition of tax under this authority would not increase the total local tax
imposed in the city to a rate greater than one-half of one percent.
new text end
new text begin
(b) The proceeds of a tax imposed under this subdivision must be dedicated
exclusively to pay for specific regional capital projects that provide benefit to persons
outside of the city boundaries, as defined in paragraph (c), as well as to the city, and is
approved by the voters in the authorizing referendum. No proceeds may be used for
normal maintenance or operating costs of a facility. The proceeds may be used to pay for
collecting and administering the tax, to pay all or part of the capital and administrative
costs of the development, design, acquisition, construction, expansion, and improvement,
and to secure and pay debt service on bonds or other obligations issued to finance capital
costs of any of the following regional projects:
new text end
new text begin
(1) regional convention or civic center;
new text end
new text begin
(2) regional airport;
new text end
new text begin
(3) regional public libraries, regional history centers, and performing arts centers;
new text end
new text begin
(4) parks, trails, regional recreational centers, and open space;
new text end
new text begin
(5) flood control and protection;
new text end
new text begin
(6) regional wastewater project to mitigate surface or groundwater pollution;
new text end
new text begin
(7) regional government center or jail owned and operated by two or more local
government jurisdictions;
new text end
new text begin
(8) lake improvement projects included in a watershed plan;
new text end
new text begin
(9) overpasses, arterial and collector roads, or bridges, on, adjacent to, or connecting
to a Minnesota state highway; or
new text end
new text begin
(10) railroad overpasses or crossing safety improvements where the road is adjacent
to or connecting to a Minnesota state highway.
new text end
new text begin
(c) A capital project is considered to be a "regional capital project that provides
benefits to persons outside the city boundaries" if it meets one of the following criteria:
new text end
new text begin
(1) the project is one of the projects listed in paragraph (b), clauses (8) to (10);
new text end
new text begin
(2) the project is funded by more than one city under a joint powers agreement and
no more than 80 percent of the revenues for the project will be provided by one city;
new text end
new text begin
(3) at least 20 percent of the direct users of the facility, except for a convention or
civic center, will be persons from outside of the city; or
new text end
new text begin
(4) at least 20 percent of the benefit derived from the project will accrue to persons
residing or businesses located outside of the city boundaries.
new text end
new text begin
(d) At least three months prior to holding a referendum to impose the tax, a city must
provide to the commissioner of revenue a resolution approved by the city that shows that
the tax will fund a project that meets the requirements of paragraphs (a) to (c), the date
on which the referendum will be held, the maximum amount raised by the tax that may
be used for the specified project, excluding issuance and interest costs for any related
bonds, and the maximum time that the tax may be imposed. The commissioner shall
certify that the requirements under this subdivision are met and the city shall provide any
additional information the commissioner requests in order to make that determination.
The commissioner's decision is final.
new text end
new text begin
(e) The question put to the voters at the referendum authorizing the vote must include
information on the specific project to be funded by the proceeds of the tax, the maximum
amount of sales tax revenues that will be used to fund each project, not including any
issuance and interest costs for related bonds, and the maximum length of time that the tax
will be imposed. The referendum must also include a statement that the sales tax revenues
are pledged to pay for the specific capital improvement but the improvement costs and any
related bonds are a general obligation of the political subdivision and will be guaranteed
by the political subdivision's property tax levy. If the referendum is not held on the date
contained in the resolution, the authority for imposing the tax expires.
new text end
new text begin
(f) A city may hold a referendum for more than one project at the same election
provided that:
new text end
new text begin
(1) all the requirements under this subdivision are met by each project;
new text end
new text begin
(2) the question, with information on amount to be raised and the years needed to
raise the amount, is stated separately for each project; and
new text end
new text begin
(3) the total amount needed to fund all projects listed on the ballot does not
exceed the amount of revenue that can be raised by the imposition of the tax under this
subdivision in a 12-year period.
new text end
new text begin
(g) A city may issue general obligation bonds to pay the costs of projects specified
in the referendum authorizing imposition of the tax. The approval of the question under
paragraph (e) meets the requirement for elector approval for issuance of bonds under
section 475.58, subdivision 1. The debt represented by the bonds must not be included in
computing any debt limitations applicable to the city, and the levy of taxes required by
section 475.61 to pay the principal or any interest on the bonds must not be subject to any
levy limitations or be included in computing or applying any levy limitation to the city.
new text end
new text begin
(h) The tax, if enacted, expires when the specified revenue has been raised or the
maximum time in which the tax is in effect under the resolution is reached, whichever
is sooner. Any tax imposed under this subdivision must expire no later than 12 years
after imposition. The governing board of the city may, by ordinance, terminate the tax at
an earlier date.
new text end
new text begin
(i) Except as specifically authorized by this section, a city must not use public funds
to prepare or disseminate material regarding the passage of a ballot question under section
297A.99, subdivision 1a, including but not limited to billboards or other signs, newspaper
advertising, advertising messages broadcast on radio or television, programming on cable
television, except for any legal requirements regarding notice of election. A city may
allow meetings in a public building of proponents of a question involving imposing a local
sales tax under section 297A.99, subdivision 1a, if opponents of the question who so
request are allowed to meet in a public building on similar terms to those applicable to
the proponents. A city must not allow proponents or opponents of a ballot question on
imposition of a local sales tax under section 297A.99, subdivision 1a, to place campaign
signs on public property.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for local sales taxes for which the
authorizing referendum is held after June 30, 2004. If the authorizing referendum was
held prior to July 1, 2005, the three month prior notice to the commissioner contained
in paragraph (d) shall not apply, but the commissioner must still certify that all other
provisions of this subdivision are met before the tax may be imposed.
new text end
Sec. 36.
Minnesota Statutes 2004, section 297A.99, subdivision 3, is amended to read:
Subd. 3.
Requirements for adoption, use, termination.
(a) Imposition of a local
sales tax is subject to approval by voters of the political subdivision at a general election.
(b) The proceeds of the tax must be dedicated exclusively to payment of the cost of a
specific capital improvement which is designated at least 90 days before the referendum
on imposition of the tax is conducted.
(c) The tax must terminate after the improvement designated under paragraph (b)
has been completed.
deleted text begin
(d) After a sales tax imposed by a political subdivision has expired or been
terminated, the political subdivision is prohibited from imposing a local sales tax for a
period of one year. Notwithstanding subdivision 13, this paragraph applies to all local
sales taxes in effect at the time of or imposed after May 26, 1999.
deleted text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective July 1, 2005.
new text end
Sec. 37.
Minnesota Statutes 2004, section 297A.99, subdivision 4, is amended to read:
Subd. 4.
Tax base.
(a) The tax applies to sales taxable under this chapter that occur
within the political subdivision.
(b) Taxable new text begin goods or new text end services are subject to a political subdivision's sales tax, if
they are deleted text begin performed either:
deleted text end
deleted text begin
(1) within the political subdivision, or
deleted text end
deleted text begin (2) partly within and partly without the political subdivision and more of the service
is performed within the political subdivision, based on the cost of performance deleted text end new text begin sourced
to the political subdivision pursuant to section 297A.668new text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for sales made on or after January
1, 2004.
new text end
Sec. 38.
Minnesota Statutes 2004, section 297A.99, subdivision 9, is amended to read:
Subd. 9.
Enforcement; collection; and administration.
(a) The commissioner of
revenue shall collect the taxes subject to this section. The commissioner may collect the
tax with the state sales and use tax. All taxes under this section are subject to the same
penalties, interest, and enforcement provisions as apply to the state sales and use tax.
(b) A request for a refund of state sales tax paid in excess of the amount of tax
legally due includes a request for a refund of the political subdivision taxes paid on the
goods or services. The commissioner shall refund to the taxpayer the full amount of the
political subdivision taxes paid on exempt sales or use.
new text begin
(c) A political subdivision shall incur a legal debt to the state for refunds of local
sales taxes made by the commissioner after a tax has terminated when the amount of
the refunds exceeds the amount of local sales taxes collected for but not remitted to the
political subdivision. The commissioner of revenue shall deduct the amount of the debt
from the next payment scheduled to be made to the political subdivision under section
273.1384, 273.1398, or sections 477A.011 to 477A.014. The commissioner shall deposit
the money in the state treasury and credit it to the general fund.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for all refunds made on or after the
day following final enactment.
new text end
Sec. 39.
Minnesota Statutes 2004, section 297A.99, is amended by adding a
subdivision to read:
new text begin Subd. 12a. new text end
new text begin Notification of use tax. new text end
new text begin
Any city or county imposing a local sales and
use tax, which maintains an official web site, must display on its main home page a notice
that residents and businesses in the city or county may owe a local use tax on purchases of
goods and services made outside of the city or county limits. The notice must provide
information, including a link to any relevant Department of Revenue Web site, on how
the taxpayer may get information and forms necessary for calculating and paying the
tax. If the city or county provides and bills for sewer, water, garbage collection, or other
public utility services, the billing statement must also include a notice that residents and
businesses may owe a local use tax on purchases made outside of the city or county limits
and provide information on how the taxpayer may get information and forms necessary
for calculating and paying the tax.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective January 1, 2006.
new text end
Sec. 40.
Minnesota Statutes 2004, section 477A.016, is amended to read:
477A.016 NEW TAXES PROHIBITED.
No county, city, town or other taxing authority shall increase a present tax or impose
a new tax on sales or incomenew text begin , except as provided in section 297A.981 or section 297A.99,
subdivision 1anew text end .
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective July 1, 2005.
new text end
Sec. 41.
Laws 1998, chapter 389, article 8, section 43, subdivision 3, is amended to
read:
Subd. 3.
Use of revenues.
Revenues received from the taxes authorized by
subdivisions 1 and 2 must be used by the city to pay for the cost of collecting and
administering the taxes and to pay for the following projects:
(1) transportation infrastructure improvements including both highway and airport
improvements;
(2) improvements to the civic center complex;
(3) a municipal water, sewer, and storm sewer project necessary to improve regional
ground water quality; and
(4) construction of a regional recreation and sports center and deleted text begin associated deleted text end new text begin other
new text end facilities available for both community and student usedeleted text begin , located at or adjacent to the
Rochester centerdeleted text end .
The total amount of capital expenditures or bonds for these projects that may be paid from
the revenues raised from the taxes authorized in this section may not exceed $71,500,000.
The total amount of capital expenditures or bonds for the project in clause (4) that may be
paid from the revenues raised from the taxes authorized in this section may not exceed
$20,000,000.
[EFFECTIVE DATE; LOCAL APPROVAL.]
new text begin
This section is effective the day
after the governing body of Rochester and its chief clerical officer timely complete their
compliance with Minnesota Statutes, section 645.021, subdivisions 2 and 3.
new text end
Sec. 42.
Laws 2001, First Special Session chapter 5, article 12, section 95, as amended
by Laws 2002, chapter 377, article 3, section 24, and Laws 2003, First Special Session
chapter 21, article 8, section 15, is amended to read:
Sec. 95new text begin REPEALER.
new text end
(a) Minnesota Statutes 2000, sections 297A.61, subdivision 16; 297A.68,
subdivision 21; and 297A.71, subdivision 2, are repealed effective for sales and purchases
occurring after June 30, 2001, except that the repeal of section 297A.61, subdivision 16,
paragraph (d), is effective for sales and purchases occurring after July 31, 2001.
(b) Minnesota Statutes 2000, deleted text begin sections deleted text end new text begin section new text end 297A.62, subdivision 2, deleted text begin and 297A.64,
subdivision 1, are deleted text end new text begin is new text end repealed effective for sales and purchases made after December
31, 2005.
(c) Minnesota Statutes 2000, section 297A.71, subdivision 15, is repealed effective
for sales and purchases made after June 30, 2002.
(d) Minnesota Statutes 2000, section 297A.71, subdivision 16, is repealed effective
for sales and purchases occurring after December 31, 2002.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 43.
Laws 2002, chapter 377, article 3, section 4, the effective date, is amended to
read:
new text begin EFFECTIVE DATE. new text end
deleted text begin With the exception of clause (2), item (ii),deleted text end This section is
effective for sales and purchases made after June 30, 2002. deleted text begin Clause (2), item (ii), is
effective for sales and purchases made after June 30, 2002, and before January 1, 2006.
deleted text end
Sec. 44. new text begin CITY OF MANKATO; LOCAL SALES TAX EXPIRATION DATE.
new text end
new text begin
Notwithstanding any other provision of law or municipal charter to the contrary,
the city of Mankato may by resolution extend the imposition of the taxes imposed under
Laws 1991, chapter 291, article 8, section 27, subdivisions 1 and 2, as needed to pay off
existing bonds but no later than December 31, 2018. The proceeds of the tax must be used
only to pay off previously issued bonds authorized under Laws 1991, chapter 291, article
8, section 27, and Laws 1996, chapter 471, article 2, section 25, and for renovations and
capital improvements of the original projects funded by the sales tax under these laws.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day after compliance by the city
of Mankato with Minnesota Statutes, section 645.021, subdivision 3.
new text end
Sec. 45. new text begin ST. CLOUD AREA CITIES; SALES AND USE TAX AUTHORIZED.
new text end
new text begin Subdivision 1. new text end
new text begin Sales and use tax authorized. new text end
new text begin
Notwithstanding Minnesota Statutes,
sections 297A.99, subdivision 3, paragraph (d), and 477A.016, or any other provision of
law, ordinance, or city charter, the following cities may, by ordinance, impose a sales and
use tax of one-half of one percent for the purposes specified in subdivision 2:
new text end
new text begin
(1) the city of St. Cloud, pursuant to the approval of the city voters at the general
election held on November 2, 2004;
new text end
new text begin
(2) the city of St. Joseph, pursuant to the approval of the city voters at the general
election on November 2, 2004;
new text end
new text begin
(3) the city of Waite Park, pursuant to the approval of the city voters at the general
election held on November 4, 2003;
new text end
new text begin
(4) the city of Sartell, pursuant to the approval of the voters of that city at the general
election held on November 2, 1999; and
new text end
new text begin
(5) the city of St. Augusta, pursuant to the approval of the voters of that city at
the next general election.
new text end
new text begin
The provisions of Minnesota Statutes, section 297A.99, except subdivision 3,
paragraph (d), govern the imposition, administration, collection, and enforcement of the
tax authorized under this section, unless specifically provided for otherwise in another
subdivision.
new text end
new text begin Subd. 2. new text end
new text begin Use of revenues. new text end
new text begin
(a) Revenues received from the tax authorized by
subdivision 1 by the city of St. Cloud must be used for the cost of collecting and
administering the tax and to pay all or part of the capital or administrative costs of the
development, acquisition, construction, improvement, and securing and paying debt
service on bonds or other obligations issued to finance the following regional projects as
approved by the voters and specifically detailed in the referendum authorizing the tax:
new text end
new text begin
(1) St. Cloud Regional Airport;
new text end
new text begin
(2) regional transportation improvements;
new text end
new text begin
(3) community and aquatics centers;
new text end
new text begin
(4) regional public libraries; and
new text end
new text begin
(5) acquisition and improvement of regional park land and open space.
new text end
new text begin
(b) Revenues received from the tax authorized by subdivision 1 by the cities of Waite
Park, Sartell, and St. Augusta must be used for the cost of collecting and administering
the tax and to pay all or part of the capital or administrative costs of the development,
acquisition, construction, improvement, and securing and paying debt service on bonds
or other obligations issued to fund the projects specifically approved by the voters at the
referendum authorizing the tax. The portion of revenues from the city going to fund the
regional airport or regional library located in the city of St. Cloud will be as required
under the applicable joint powers agreement.
new text end
new text begin
(c) The use of revenues received from the taxes authorized in subdivision 1 for
projects allowed under paragraphs (a) and (b) are limited to the amount authorized for
each project under the enabling referendum.
new text end
new text begin Subd. 3.new text end [ST. CLOUD BONDING AUTHORIZED.] new text begin (a) The city of St. Cloud may
issue general obligation bonds of up to $30,000,000 to pay for the costs of the regional
public library pursuant to the approval of the projects by the city voters at the election
held on November 2, 2004.
new text end
new text begin
(b) Each city may issue general obligation bonds for another project authorized
under subdivision 2 without separate bonding approval at a referendum only if the
issuance of bonds for that project was included in the authorizing question. The amount of
bonds issued for a project is limited to the maximum amount of local sales tax revenues
that may be spent on the project under the authorizing question.
new text end
new text begin
(c) The debt represented by the bonds authorized under this subdivision must not be
included in computing any debt limitations applicable to the city, and the levy of taxes
required by Minnesota Statutes, section 475.61, to pay the principal or any interest on the
bonds must not be subject to any levy limitations or be included in computing or applying
any levy limitation applicable to the city.
new text end
new text begin Subd. 4. new text end
new text begin Termination of tax. new text end
new text begin
(a) The tax imposed in the cities of St. Joseph and
St. Cloud under subdivision 1 expires when the city council determines that sufficient
funds have been collected from the tax to retire or redeem the bonds and obligations
authorized under subdivision 2, paragraph (a), but no later than 11 years after the date
the tax is first imposed.
new text end
new text begin
(b) The tax imposed in the city of Waite Park expires July 1, 2007. Any funds
remaining after completion of the projects specified in subdivision 2 and retirement or
redemption of the bonds may be placed in the general fund of the city. The tax imposed in
the city of St. Augusta expires five years after it is first imposed. Any funds remaining after
completion of the projects specified in subdivision 2 and retirement or redemption of the
bonds may be placed in the general fund of the city. Each tax imposed under subdivision 1
may expire at an earlier time if the city so determines by ordinance. The cities may extend
the tax beyond the dates in this paragraph upon additional approval of the voters at a
subsequent referendum. The tax may not be extended beyond the number of years allowed
in paragraph (a). The tax imposed in the city of Sartell expires December 31, 2006.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for the city that approves it the day
after compliance by the governing body of each city with Minnesota Statutes, section
645.021, subdivision 3, for sales and purchases made on and after January 1, 2006.
Spending may not occur for the purposes authorized in subdivision 2 nor may bonds be
issued under subdivision 3 until January 1, 2006.
new text end
Sec. 46. new text begin CITY OF BEMIDJI; LOCAL SALES TAX.
new text end
new text begin
Notwithstanding Minnesota Statutes, sections 297A.99 and 477A.03, or any other
provision of law, ordinance, or charter to the contrary, the city of Bemidji may impose a
sales tax pursuant to the approval of the city voters at a general election on November 5,
2002. Revenues from the tax must be used for the cost of collecting and administering
the tax and to pay all or part of the capital and administrative costs of the acquisition,
construction, improvement, and development of parks and trails within the city, as
provided for in the city of Bemidji's parks, open space, and trail system plan, adopted by
the Bemidji city council on November 21, 2001. Authorized expenses include, but are not
limited to, acquiring property, paying construction expenses related to the development of
these facilities and improvements, and securing and paying any debt service on bonds or
other obligations issued to finance acquisition, construction, improvement, or development
of parks and trails within the city of Bemidji. All other provisions of section 297A.99
not in conflict with the provisions of this section shall apply to the imposition, collection,
administration, and use of revenues from this tax.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day after compliance by the city
of Bemidji with Minnesota Statutes, section 645.021, subdivision 3.
new text end
Sec. 47. new text begin CITY OF ROCHESTER; LOCAL SALES TAX EXPIRATION DATE.
new text end
new text begin
Notwithstanding Minnesota Statutes, section 297A.99, or any other provision of law
or municipal charter to the contrary, the city of Rochester may by resolution extend the
taxes imposed under Laws 1998, chapter 389, article 8, section 43, until December 31,
2014. This extension of the imposition of taxes shall occur notwithstanding either of the
total amount limitations on capital expenditures or bonds specified in Laws 1998, chapter
389, article 8, section 43. The proceeds of the tax must be used for the purposes authorized
under that law and for regional highway infrastructure improvements jointly undertaken
with Olmsted County. The city and the county may issue general obligation bonds for the
purposes authorized under this section. The county may issue general obligation bonds
in an amount not exceeding the amount of sales tax revenue anticipated to be received
from the city. The city may issue additional general obligation bonds, above the amount
allowed under Laws 1988, chapter 389, article 8, section 43, equal to the difference
between the amount of additional local sales tax raised under this section and the amount
anticipated to be given to the county. No election is required for the issuance of bonds
under this subdivision, other than the election held by the city on June 23, 1998. The
bonds shall not be included as net debt of the city or the county.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day after compliance by the city
of Rochester with Minnesota Statutes, section 645.021, subdivisions 2 and 3.
new text end
Sec. 48. new text begin REPEALER.
new text end
new text begin
Minnesota Rules, parts 8130.0110, subpart 4; 8130.0200, subparts 5 and 6;
8130.0400, subpart 9; 8130.1200, subparts 5 and 6; 8130.2900; 8130.3100, subpart 1;
8130.4000, subparts 1 and 2; 8130.4200, subpart 1; 8130.4400, subpart 3; 8130.5200;
8130.5600, subpart 3; 8130.5800, subpart 5; 8130.7300, subpart 5; and 8130.8800,
subpart 4, are repealed.
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
ARTICLE 8
SPECIAL TAXES AND FEES
Section 1.
Minnesota Statutes 2004, section 240.30, is amended by adding a
subdivision to read:
new text begin Subd. 11. new text end
new text begin Franchise fee. new text end
new text begin
As a condition of operating a card club under this section,
the licensee must pay a fee to the commission equal to 15 percent of the gross revenues,
less any refunds, for charges imposed under subdivision 4. Payment, collection, and
administration of the fee must be made in the same manner and under the terms provided
under section 240.15 for the tax on pari-mutuel pools. The commission shall deposit all of
the revenues from the fee in the state treasury and amounts deposited must be credited
to the general fund. The amount of the fee under this subdivision does not reduce the
obligation to set aside revenues from the card club under section 240.135.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for charges and revenues received
after June 30, 2005.
new text end
Sec. 2.
Minnesota Statutes 2004, section 287.04, is amended to read:
287.04 EXEMPTIONS.
The tax imposed by section 287.035 does not apply to:
(a) A decree of marriage dissolution or an instrument made pursuant to it.
(b) A mortgage given to correct a misdescription of the mortgaged property.
(c) A mortgage or other instrument that adds additional security for the same debt
for which mortgage registry tax has been paid.
(d) A contract for the conveyance of any interest in real property, including a
contract for deed.
(e) A mortgage secured by real property subject to the minerals production tax of
sections 298.24 to 298.28.
(f) The principal amount of a mortgage loan made under a low and moderate
income or other affordable housing program, if the mortgagee is a federal, state, or local
government agency.
(g) Mortgages granted by fraternal benefit societies subject to section 64B.24.
(h) A mortgage amendment or extension, as defined in section 287.01.
(i) An agricultural mortgage if the proceeds of the loan secured by the mortgage are
used to acquire or improve real property classified under section 273.13, subdivision 23,
paragraph (a), or (b), clause (1), (2), or (3).
new text begin
(j) A mortgage on an armory building as set forth in section 193.147.
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.
Minnesota Statutes 2004, section 295.52, subdivision 4, is amended to read:
Subd. 4.
Use tax; prescription drugs.
(a) A person that receives prescription drugs
for resale or use in Minnesota, other than from a wholesale drug distributor that is subject
to tax under subdivision 3, is subject to a tax equal to the price paid to the wholesale drug
distributor multiplied by the tax percentage specified in this section. Liability for the tax is
incurred when prescription drugs are received or delivered in Minnesota by the person.
(b) A person that receives prescription drugs for use in Minnesota from a nonresident
pharmacy required to be registered under section 151.19 is subject to a tax equal to
the price paid by the nonresident pharmacy to the wholesale drug distributor or the
price received by the nonresident pharmacy, whichever is lower, multiplied by the tax
percentage specified in this section. Liability for the tax is incurred when prescription
drugs are received in Minnesota by the person.
new text begin
(c) A tax imposed under this subdivision does not apply to purchases by an
individual for personal use or consumption.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for purchases made after June 30,
2005.
new text end
Sec. 4.
Minnesota Statutes 2004, section 295.53, subdivision 1, is amended to read:
Subdivision 1.
Exemptions.
(a) The following payments are excluded from the
gross revenues subject to the hospital, surgical center, or health care provider taxes under
sections 295.50 to 295.59:
(1) payments received for services provided under the Medicare program, including
payments received from the government, and organizations governed by sections 1833
and 1876 of title XVIII of the federal Social Security Act, United States Code, title 42,
section 1395, and enrollee deductibles, coinsurance, and co-payments, whether paid by the
Medicare enrollee or by a Medicare supplemental coverage as defined in section 62A.011,
subdivision 3, clause (10), or by Medicaid payments under title XIX of the federal Social
Security Act. Payments for services not covered by Medicare are taxable;
(2) payments received for home health care services;
(3) payments received from hospitals or surgical centers for goods and services on
which liability for tax is imposed under section 295.52 or the source of funds for the
payment is exempt under clause (1), (7), (10), or (14);
(4) payments received from health care providers for goods and services on which
liability for tax is imposed under this chapter or the source of funds for the payment is
exempt under clause (1), (7), (10), or (14);
(5) amounts paid for legend drugs, other than nutritional products, to a wholesale
drug distributor who is subject to tax under section 295.52, subdivision 3, reduced by
reimbursements received for legend drugs otherwise exempt under this chapter;
(6) payments received by a health care provider or the wholly owned subsidiary of a
health care provider for care provided outside Minnesota;
(7) payments received from the chemical dependency fund under chapter 254B;
(8) payments received in the nature of charitable donations that are not designated
for providing patient services to a specific individual or group;
(9) payments received for providing patient services incurred through a formal
program of health care research conducted in conformity with federal regulations
governing research on human subjects. Payments received from patients or from other
persons paying on behalf of the patients are subject to tax;
(10) payments received from any governmental agency for services benefiting the
public, not including payments made by the government in its capacity as an employer
or insurer or payments made by the government for services provided under general
assistance medical care, the MinnesotaCare program, or the medical assistance program
governed by title XIX of the federal Social Security Act, United States Code, title 42,
sections 1396 to 1396v;
(11) government payments received by the commissioner of human services for
state-operated services;
(12) payments received by a health care provider for hearing aids and related
equipment or prescription eyewear delivered outside of Minnesota;
(13) payments received by an educational institution from student tuition, student
activity fees, health care service fees, government appropriations, donations, or grants, and
for services identified in and provided under an individualized education plan as defined in
section 256B.0625 or Code of Federal Regulations, chapter 34, section 300.340(a). Fee
for service payments and payments for extended coverage are taxable;deleted text begin and
deleted text end
(14) payments received under the federal Employees Health Benefits Act, United
States Code, title 5, section 8909(f), as amended by the Omnibus Reconciliation Act of
1990. new text begin Enrollee deductibles, coinsurance, and co-payments are subject to tax; and
new text end
new text begin
(15) payments received under the federal Tricare program, Code of Federal
Regulations, title 32, section 199.17(a)(7). Enrollee deductibles, coinsurance, and
co-payments are subject to tax.
new text end
(b) Payments received by wholesale drug distributors for legend drugs sold directly
to veterinarians or veterinary bulk purchasing organizations are excluded from the gross
revenues subject to the wholesale drug distributor tax under sections 295.50 to 295.59.
new text begin EFFECTIVE DATE. new text end
new text begin
The change made to paragraph (a), clause (14), of this section
is effective for enrollee deductibles, coinsurance, and co-payments received under the
federal Employees Health Benefits Act on or after the day following final enactment.
Paragraph (a), clause (15), is effective for gross revenues received under the federal
Tricare program after December 31, 2004.
new text end
Sec. 5.
Minnesota Statutes 2004, section 295.582, is amended to read:
295.582 AUTHORITY.
new text begin Subdivision 1. new text end
new text begin Transfer to third-party purchasers. new text end
(a) A hospital, surgical center,
or health care provider that is subject to a tax under section 295.52, or a pharmacy
that has paid additional expense transferred under this section by a wholesale drug
distributor, may transfer additional expense generated by section 295.52 obligations on
to all third-party contracts for the purchase of health care services on behalf of a patient
or consumer. The additional expense transferred to the third-party purchaser must not
exceed the tax percentage specified in section 295.52 multiplied against the gross revenues
received under the third-party contract, and the tax percentage specified in section
295.52 multiplied against co-payments and deductibles paid by the individual patient or
consumer. new text begin A health care provider who chooses to transfer the tax specified in section
295.52 may itemize the tax on patient billings.new text end The expense must not be generated on
revenues derived from payments that are excluded from the tax under section 295.53. All
third-party purchasers of health care services including, but not limited to, third-party
purchasers regulated under chapter 60A, 62A, 62C, 62D, 62H, 62N, 64B, 65A, 65B, 79,
or 79A, or under section 471.61 or 471.617, new text begin and a pharmacy benefits manager new text end must pay
the transferred expense in addition to any payments due under existing contracts with the
hospital, surgical center, pharmacy, or health care provider, to the extent allowed under
federal law. A third-party purchaser of health care services includes, but is not limited to,
a health carrier or community integrated service network that pays for health care services
on behalf of patients or that reimburses, indemnifies, compensates, or otherwise insures
patients for health care services new text begin and for purposes of this section, a pharmacy benefits
manager means an entity that performs pharmacy benefits managementnew text end . A third-party
purchaser shall comply with this section regardless of whether the third-party purchaser
is a for-profit, not-for-profit, or nonprofit entity new text begin or whether the health care provider has
chosen to itemize the tax on patient billings. If the third-party purchaser's contract limits
provider payment to a specified amount, such as an usual and customary fee schedule,
the third-party purchaser must still pay the tax transferred or itemized by a health care
provider based upon the contractual fee. A third-party purchaser is also responsible for
reimbursing providers for the percentage tax levied on co-payments or deductibles paid by
the insurednew text end . A wholesale drug distributor may transfer additional expense generated by
section 295.52 obligations to entities that purchase from the wholesaler, and the entities
must pay the additional expense. Nothing in this section limits the ability of a hospital,
surgical center, pharmacy, wholesale drug distributor, or health care provider to recover all
or part of the section 295.52 obligation by other methods, including increasing fees or
charges. new text begin Nothing in this section prohibits a pharmacy from passing on additional fees or
charges to a pharmacy benefits manager.
new text end
(b) Each third-party purchaser regulated under any chapter cited in paragraph
(a) shall include with its annual renewal for certification of authority or licensure
documentation indicating compliance with paragraph (a). new text begin The documentation must
include information relating to a third-party purchaser's means for compliance with
paragraph (a) for health care providers who itemize the tax on patient billings.
new text end
(c) Any hospital, surgical center, or health care provider subject to a tax under
section 295.52 or a pharmacy that has paid additional expense transferred under this
section by a wholesale drug distributor may file a complaint with the commissioner
responsible for regulating the third-party purchaser if at any time the third-party purchaser
fails to comply with paragraph (a).
(d) If the commissioner responsible for regulating the third-party purchaser finds
at any time that the third-party purchaser has not complied with paragraph (a), the
commissioner may take enforcement action against a third-party purchaser which is
subject to the commissioner's regulatory jurisdiction and which does not allow a hospital,
surgical center, pharmacy, or provider to pass-through the tax. The commissioner may
by order fine or censure the third-party purchaser or revoke or suspend the certificate
of authority or license of the third-party purchaser to do business in this state if the
commissioner finds that the third-party purchaser has not complied with this section. The
third-party purchaser may appeal the commissioner's order through a contested case
hearing in accordance with chapter 14.
new text begin Subd. 2. new text end
new text begin Wholesale drug distributor tax; agreement. new text end
new text begin
A contracting agreement
between a health plan company or a pharmacy benefits manager and a resident or
nonresident pharmacy registered under chapter 151, may not prohibit:
new text end
new text begin
(1) a pharmacy that has paid additional expense transferred under this section by a
wholesale drug distributor from exercising its option under this section to transfer such
additional expenses generated by the section 295.52 obligations on to the health plan
company, a pharmacy benefits manager, or a third-party purchaser; or
new text end
new text begin
(2) a pharmacy that is subject to tax under section 295.52, subdivision 4, from
exercising its option under this section to recover all or part of the section 295.52
obligations from the health plan company, a pharmacy benefits manager, or a third-party
purchaser by other methods, including increasing fees or charges.
new text end
Sec. 6.
Minnesota Statutes 2004, section 295.60, subdivision 3, is amended to read:
Subd. 3.
Payment.
(a) Each furrier shall make estimated payments of the taxes for
the calendar year in quarterly installments to the commissioner by April 15, July 15,
October 15, and January 15 of the following calendar year.
(b) Estimated tax payments are not required if:
(1) the tax for the current calendar year is less than $500; or
(2) the tax for the previous calendar year is less than $500, if the taxpayer had a tax
liability and was doing business the entire year.
(c) Underpayment of estimated installments bear interest at the rate specified in
section 270.75, from the due date of the payment until paid or until the due date of the
annual return, whichever comes first. An underpayment of an estimated installment is
the difference between the amount paid and the lesser of (1) deleted text begin 90 percent of one-quarter
of the tax for the calendar year deleted text end new text begin the tax for the actual gross revenues received during the
quarternew text end , or (2) one-quarter of the total tax for the previous calendar year if the taxpayer
had a tax liability and was doing business the entire year.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for gross revenues received after
December 31, 2004.
new text end
Sec. 7.
new text begin
[295.75] LIQUOR GROSS RECEIPTS TAX.
new text end
new text begin Subdivision 1. new text end
new text begin Definitions. new text end
new text begin
(a) For purposes of this section, the following terms
have the meanings given.
new text end
new text begin
(b) "Commissioner" means the commissioner of revenue.
new text end
new text begin
(c) "Gross receipts" means the total amount received, in money or by barter or
exchange, for all liquor sales at retail as measured by the sales price, but does not include
any taxes imposed directly on the consumer that are separately stated on the invoice, bill
of sale, or similar document given to the purchaser.
new text end
new text begin
(d) "Liquor" means:
new text end
new text begin
(1) intoxicating liquor, as defined in section 340A.101, subdivision 14;
new text end
new text begin
(2) beverage containing intoxicating liquor; and
new text end
new text begin
(3) 3.2 percent malt liquor, as defined in section 340A.101, subdivision 19, when
sold at an on-sale or off-sale municipal liquor store or other establishment licensed to sell
any type of intoxicating liquor.
new text end
new text begin
(e) "Liquor retailer" means a retailer that sells liquor.
new text end
new text begin
(f) "Retail sale" has the meaning given in section 297A.61, subdivision 4.
new text end
new text begin Subd. 2. new text end
new text begin Gross receipts tax imposed. new text end
new text begin
A tax is imposed on each liquor retailer equal
to 2.5 percent of gross receipts from retail sales in Minnesota of liquor.
new text end
new text begin Subd. 3. new text end
new text begin Use tax imposed; credit for taxes paid. new text end
new text begin
(a) A person that receives liquor
for use or storage in Minnesota, other than from a liquor retailer that paid the tax under
subdivision 2, is subject to tax at the rate imposed under subdivision 2. Liability for the
tax is incurred when the person has possession of the liquor in Minnesota. The tax must
be remitted to the commissioner in the same manner prescribed for the taxes imposed
under chapter 297A.
new text end
new text begin
(b) A person that has paid taxes to another jurisdiction on the same transaction and
is subject to tax under this section is entitled to a credit for the tax legally due and paid
to another jurisdiction to the extent of the lesser of (1) the tax actually paid to the other
jurisdiction, or (2) the amount of tax imposed by Minnesota on the transaction subject to
tax in the other jurisdiction.
new text end
new text begin Subd. 4. new text end
new text begin Tax collection required. new text end
new text begin
A liquor retailer with nexus in Minnesota, who
is not subject to tax under subdivision 2, is required to collect the tax imposed under
subdivision 3 from the purchaser of the liquor and give the purchaser a receipt for the
tax paid. The tax collected must be remitted to the commissioner in the same manner
prescribed for the taxes imposed under chapter 297A.
new text end
new text begin Subd. 5. new text end
new text begin Taxes paid to another jurisdiction; credit. new text end
new text begin
A liquor retailer that has
paid taxes to another jurisdiction measured by gross receipts and is subject to tax under
this section on the same gross receipts is entitled to a credit for the tax legally due and
paid to another jurisdiction to the extent of the lesser of (1) the tax actually paid to the
other jurisdiction, or (2) the amount of tax imposed by Minnesota on the gross receipts
subject to tax in the other taxing jurisdictions.
new text end
new text begin Subd. 6. new text end
new text begin Exemptions. new text end
new text begin
All of the exemptions applicable to the taxes imposed under
chapter 297A are applicable to the taxes imposed under this section.
new text end
new text begin Subd. 7. new text end
new text begin Sourcing of sales. new text end
new text begin
All of the provisions of section 297A.668 apply to
the taxes imposed by this section.
new text end
new text begin Subd. 8. new text end
new text begin Payment; reporting. new text end
new text begin
A liquor retailer shall report the tax on a return
prescribed by the commissioner of revenue, and shall remit the tax with the return. The
return and the tax must be filed and paid using the filing cycle and due dates provided for
taxes imposed under chapter 297A.
new text end
new text begin Subd. 9. new text end
new text begin Administration. new text end
new text begin
Unless specifically provided otherwise by this section,
the audit, assessment, refund, penalty, interest, enforcement, collection remedies, appeal,
and administrative provisions of chapters 270 and 289A that are applicable to taxes
imposed under chapter 297A apply to taxes imposed under this section.
new text end
new text begin Subd. 10. new text end
new text begin Interest on overpayments. new text end
new text begin
Interest must be paid on an overpayment
refunded or credited to the taxpayer from the date of payment of the tax until the date the
refund is paid or credited. For purposes of this subdivision, the date of payment is the due
date of the return or the date of actual payment of the tax, whichever is later.
new text end
new text begin Subd. 11. new text end
new text begin Deposit of revenues. new text end
new text begin
The commissioner shall deposit all revenues,
including penalties and interest, derived from the tax imposed by this section in the
general fund.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for sales and purchases occurring on
or after January 1, 2006.
new text end
Sec. 8.
Minnesota Statutes 2004, section 296A.22, is amended by adding a subdivision
to read:
new text begin Subd. 9. new text end
new text begin Abatement of penalty. new text end
new text begin
(a) The commissioner may by written order
abate any penalty imposed under this section, if in the commissioner's opinion there is
reasonable cause to do so.
new text end
new text begin
(b) A request for abatement of penalty must be filed with the commissioner within
60 days of the date the notice stating that a penalty has been imposed was mailed to the
taxpayer's last known address.
new text end
new text begin
(c) If the commissioner issues an order denying a request for abatement of penalty,
the taxpayer may file an administrative appeal as provided in section 296A.25 or appeal to
Tax Court as provided in section 271.06. If the commissioner does not issue an order on
the abatement request within 60 days from the date the request is received, the taxpayer
may appeal to Tax Court as provided in section 271.06.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for penalties imposed on or after the
day following final enactment.
new text end
Sec. 9.
Minnesota Statutes 2004, section 297E.01, subdivision 5, is amended to read:
Subd. 5.
Distributor.
"Distributor" means a distributor as defined in section 349.12,
subdivision 11, or a person new text begin or linked bingo game provider new text end who markets, sells, or provides
gambling product to a person or entity for resale or use at the retail level.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 10.
Minnesota Statutes 2004, section 297E.01, subdivision 7, is amended to read:
Subd. 7.
Gambling product.
"Gambling product" means bingo new text begin hard new text end cards, new text begin bingo
new text end paperdeleted text begin , or deleted text end sheetsnew text begin , or linked bingo paper sheetsnew text end ; pull-tabs; tipboards; paddletickets and
paddleticket cards; raffle tickets; or any other ticket, card, board, placard, device, or token
that represents a chance, for which consideration is paid, to win a prize.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 11.
Minnesota Statutes 2004, section 297E.01, is amended by adding a subdivision
to read:
new text begin Subd. 9a. new text end
new text begin Linked bingo game. new text end
new text begin
"Linked bingo game" means a bingo game played at
two or more locations where licensed organizations are authorized to conduct bingo, when
there is a common prize pool and a common selection of numbers or symbols conducted
at one location, and when the results of the selection are transmitted to all participating
locations by satellite, telephone, or other means by a linked bingo game provider.
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. 12.
Minnesota Statutes 2004, section 297E.01, is amended by adding a subdivision
to read:
new text begin Subd. 9b. new text end
new text begin Linked bingo game provider. new text end
new text begin
"Linked bingo game provider" means any
person who provides the means to link bingo prizes in a linked bingo game, who provides
linked bingo paper sheets to the participating organizations, who provides linked bingo
prize management, and who provides the linked bingo game system.
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. 13.
Minnesota Statutes 2004, section 297E.06, subdivision 2, is amended to read:
Subd. 2.
Business records.
An organization shall maintain records supporting the
gambling activity reported to the commissioner. Records include, but are not limited
to, the following items:
(1) all winning and unsold tickets, cards, or stubs for pull-tab, tipboard, paddlewheel,
and raffle games;
(2) all reports and statements, including checker's records, for each bingo occasion;
(3) all cash journals and ledgers, deposit slips, register tapes, and bank statements
supporting gambling activity receipts;
(4) all invoices that represent purchases of gambling product;
(5) all canceled checks new text begin or copies of substitute checks as defined in Public Law
108-100, section 3new text end , check recorders, journals and ledgers, vouchers, invoices, bank
statements, and other documents supporting gambling activity expenditures; and
(6) all organizational meeting minutes.
All records required to be kept by this section must be preserved by the organization
for at least 3-1/2 years and may be inspected by the commissioner of revenue at any
reasonable time without notice or a search warrant.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective July 1, 2005.
new text end
Sec. 14.
Minnesota Statutes 2004, section 297E.07, is amended to read:
297E.07 INSPECTION RIGHTS.
At any reasonable time, without notice and without a search warrant, the
commissioner may enter a place of business of a manufacturer, distributor, deleted text begin or deleted text end organizationnew text begin ,
or linked bingo game providernew text end ; any site from which pull-tabs or tipboards or other
gambling equipment or gambling product are being manufactured, stored, or sold; or
any site at which lawful gambling is being conducted, and inspect the premises, books,
records, and other documents required to be kept under this chapter to determine whether
or not this chapter is being fully complied with. If the commissioner is denied free access
to or is hindered or interfered with in making an inspection of the place of business,
books, or records, the permit of the distributor may be revoked by the commissioner,
and the license of the manufacturer, the distributor, deleted text begin or deleted text end the organizationnew text begin , or linked bingo
game provider new text end may be revoked by the board.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 15.
Minnesota Statutes 2004, section 297F.08, subdivision 12, is amended to read:
Subd. 12.
Cigarettes in interstate commerce.
(a) A person may not transport or
cause to be transported from this state cigarettes for sale in another state without first
affixing to the cigarettes the stamp required by the state in which the cigarettes are to be
sold or paying any other excise tax on the cigarettes imposed by the state in which the
cigarettes are to be sold.
(b) A person may not affix to cigarettes the stamp required by another state or pay
any other excise tax on the cigarettes imposed by another state if the other state prohibits
stamps from being affixed to the cigarettes, prohibits the payment of any other excise tax
on the cigarettes, or prohibits the sale of the cigarettes.
(c) Not later than 15 days after the end of each calendar quarter, a person who
transports or causes to be transported from this state cigarettes for sale in another state
shall submit to the commissioner a report identifying the quantity and style of each brand
of the cigarettes transported or caused to be transported in the preceding calendar quarter,
and the name and address of each recipient of the cigarettes. new text begin This reporting requirement
only applies to cigarettes manufactured by companies that are not original or subsequent
participating manufacturers in the Master Settlement Agreement with other states.
new text end
(d) For purposes of this section, "person" has the meaning given in section 297F.01,
subdivision 12. Person does not include any common or contract carrier, or public
warehouse that is not owned, in whole or in part, directly or indirectly by such person,
and does not include a manufacturer that deleted text begin has entered into deleted text end new text begin is an original or subsequent
participating manufacturer in new text end the Master Settlement Agreement with other states.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 16.
Minnesota Statutes 2004, section 297F.08, is amended by adding a subdivision
to read:
new text begin Subd. 13. new text end
new text begin Bond. new text end
new text begin
The commissioner may require the furnishing of a corporate
surety bond or a certified check in an amount suitable to guarantee payment of the tax
stamps purchased by a distributor. The bond or certified check may be required when the
commissioner determines that a distributor is (1) delinquent in the filing of any return
required under this chapter, or (2) delinquent in the payment of any uncontested tax
liability under this chapter. The distributor shall furnish the bond or certified check for a
period of two years, after which, if the distributor has not been delinquent in the filing of
any returns required under this chapter, or delinquent in the paying of any tax under this
chapter, a bond or certified check is no longer required. The commissioner at any time
may apply the bond or certified check to any unpaid taxes or fees, including interest and
penalties, owed to the department by the distributor.
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. 17.
Minnesota Statutes 2004, section 297F.09, subdivision 1, is amended to read:
Subdivision 1.
Monthly return; cigarette distributor.
On or before the 18th day
of each calendar month, a distributor with a place of business in this state shall file a
return with the commissioner showing the quantity of cigarettes manufactured or brought
in from outside the state or purchased during the preceding calendar month and the
quantity of cigarettes sold or otherwise disposed of in this state and outside this state
during that month. A licensed distributor outside this state shall in like manner file a
return showing the quantity of cigarettes shipped or transported into this state during the
preceding calendar month. Returns must be made in the form and manner prescribed by
the commissioner and must contain any other information required by the commissioner.
The return must be accompanied by a remittance for the full unpaid tax liability shown
by it. deleted text begin The return for the May liability and 85 percent of the estimated June liability is
due on the date payment of the tax is due.deleted text end new text begin For distributors subject to the accelerated tax
payment requirements in subdivision 10, the return for the May liability is due two
business days before June 30th of the year and the return for the June liability is due on or
before August 18th of the year.
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. 18.
Minnesota Statutes 2004, section 297F.09, subdivision 2, is amended to read:
Subd. 2.
Monthly return; tobacco products distributor.
On or before the 18th
day of each calendar month, a distributor with a place of business in this state shall file
a return with the commissioner showing the quantity and wholesale sales price of each
tobacco product:
(1) brought, or caused to be brought, into this state for sale; and
(2) made, manufactured, or fabricated in this state for sale in this state, during the
preceding calendar month.
Every licensed distributor outside this state shall in like manner file a return showing the
quantity and wholesale sales price of each tobacco product shipped or transported to
retailers in this state to be sold by those retailers, during the preceding calendar month.
Returns must be made in the form and manner prescribed by the commissioner and
must contain any other information required by the commissioner. The return must be
accompanied by a remittance for the full tax liability shown. deleted text begin The return for the May
liability and 85 percent of the estimated June liability is due on the date payment of the tax
is due.deleted text end new text begin For distributors subject to the accelerated tax payment requirements in subdivision
10, the return for the May liability is due two business days before June 30th of the year
and the return for the June liability is due on or before August 18th of the year.
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. 19.
Minnesota Statutes 2004, section 297F.14, subdivision 4, is amended to read:
Subd. 4.
Bad debt.
deleted text begin
The commissioner may adopt rules providing a refund of the
tax paid under this chapter if the tax paid qualifies as a bad debt under section 166(a)
of the Internal Revenue Code.
deleted text end
new text begin
For any reporting period, a taxpayer may offset against
taxes payable under this chapter the amount of taxes previously paid under this chapter
that is attributable to a bad debt. The taxes must have been included in a transaction the
consideration for which was a debt owed to the taxpayer and which became uncollectible,
but only in proportion to the portion of debt that became uncollectible. To qualify for offset
under this subdivision, the debt must have qualified as a bad debt under section 166(a)
of the Internal Revenue Code. The taxpayer may claim the offset within the time period
prescribed in section 297F.17, subdivision 6. If the taxpayer is no longer liable for taxes
imposed under this chapter, the commissioner shall refund to the taxpayer the amount of
the taxes attributable to the bad debt. Any recovery of the tax claimed as a refund or credit
must be reported to the commissioner on the tax return for the month in which the recovery
is made. If the taxpayer is no longer required to file returns under this chapter, the taxpayer
must reimburse the commissioner for tax recovered in the month following the recovery.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for claims filed on or after July
1, 2005.
new text end
Sec. 20.
new text begin
[297F.25] CIGARETTE SALES TAX.
new text end
new text begin Subdivision 1. new text end
new text begin Imposition. new text end
new text begin
A tax is imposed on distributors on the sale of cigarettes
by a cigarette distributor to a retailer or cigarette subjobber for resale in this state. The tax
is equal to 6.5 percent of the weighted average retail price. The weighted average retail
price must be expressed in cents per pack when rounded to the nearest one-tenth of a cent.
The weighted average retail price must be determined annually, with new rates published
by May 1, and effective for sales on or after August 1. The weighted average retail price
must be established by surveying cigarette retailers statewide in a manner and time
determined by the commissioner. The determination of the commissioner pursuant to this
subdivision is not a "rule" and is not subject to the Administrative Procedure Act contained
in chapter 14. As of August 1, 2005, the tax is 20 cents per pack of 20 cigarettes. For
packs of cigarettes with other than 20 cigarettes, the tax must be adjusted proportionally.
new text end
new text begin Subd. 2. new text end
new text begin Payment. new text end
new text begin
Each taxpayer must remit payments of the taxes to the
commissioner on the same dates prescribed under section 297F.09, subdivision 1, for
cigarette tax returns, including the accelerated remittance of the June liability.
new text end
new text begin Subd. 3. new text end
new text begin Return. new text end
new text begin
A taxpayer must file a return with the commissioner on the
same dates prescribed under section 297F.09, subdivision 1, for cigarette tax returns.
Notwithstanding any other provisions of this chapter, the tax due on the return is based
upon actual stamps purchased during the reporting period.
new text end
new text begin Subd. 4. new text end
new text begin Form of return. new text end
new text begin
The return must contain the information and be in the
form prescribed by the commissioner.
new text end
new text begin Subd. 5. new text end
new text begin Tax as debt. new text end
new text begin
The tax that is required to be paid by the distributor is a debt
from the retailer or cigarette subjobber to the distributor recoverable at law in the same
manner as other debts. A cigarette retailer or subjobber must pay the tax imposed under
subdivision 1 to the distributor before the 12th day of the month following the month in
which the cigarettes were purchased from the distributor.
new text end
new text begin Subd. 6. new text end
new text begin Sales tax stamp. new text end
new text begin
Payment of the tax imposed under section 297F.05 and
by this section must be evidenced by a dual-purpose single stamp affixed to each package.
new text end
new text begin Subd. 7. new text end
new text begin Administration. new text end
new text begin
The stamping, audit, assessment, interest, penalty, appeal,
refund, and collection provisions applicable to the taxes imposed under this chapter apply
to taxes imposed under this section.
new text end
new text begin Subd. 8. new text end
new text begin Deposit of revenues. new text end
new text begin
Notwithstanding the provisions of section 297F.10,
the commissioner shall deposit all revenues, including penalties and interest, derived from
the tax imposed by this section, in the general fund.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for all sales made on or after August
1, 2005.
new text end
Sec. 21.
Minnesota Statutes 2004, section 297G.09, is amended by adding a
subdivision to read:
new text begin Subd. 9. new text end
new text begin Quarterly and annual payments and returns. new text end
new text begin
(a) If a manufacturer,
wholesaler, brewer, or importer has an average liquor tax liability equal to or less than $500
per month in any quarter of a calendar year, and has substantially complied with the state
tax laws during the preceding four calendar quarters, the manufacturer, wholesaler, brewer,
or importer may request authorization to file and pay the taxes quarterly in subsequent
calendar quarters. The authorization remains in effect during the period in which the
manufacturer's, wholesaler's, brewer's, or importer's quarterly returns reflect liquor tax
liabilities of less than $1,500 and there is continued compliance with state tax laws.
new text end
new text begin
(b) If a manufacturer, wholesaler, brewer, or importer has an average liquor tax
liability equal to or less than $100 per month during a calendar year, and has substantially
complied with the state tax laws during that period, the manufacturer, wholesaler, brewer,
or importer may request authorization to file and pay the taxes annually in subsequent
years. The authorization remains in effect during the period in which the manufacturer's,
wholesaler's, brewer's, or importer's annual returns reflect liquor tax liabilities of less
than $1,200 and there is continued compliance with state tax laws.
new text end
new text begin
(c) The commissioner may also grant quarterly or annual filing and payment
authorizations to manufacturers, wholesalers, brewers, or importers if the commissioner
concludes that the manufacturer's, wholesaler's, brewer's, or importer's future tax
liabilities will be less than the monthly totals identified in paragraphs (a) and (b). An
authorization granted under this paragraph is subject to the same conditions as an
authorization granted under paragraphs (a) and (b).
new text end
new text begin
(d) The annual tax return and payments must be filed and paid on or before the 18th
day of January following the calendar year. The quarterly returns and payments must be
filed and paid on or before April 18 for the quarter ending March 31, on or before July 18
for the quarter ending June 30, on or before October 18 for the quarter ending September
30, and on or before January 18 for the quarter ending December 31.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax returns and payments due on
or after January 1, 2006.
new text end
Sec. 22.
Minnesota Statutes 2004, section 297I.01, is amended by adding a subdivision
to read:
new text begin Subd. 6a. new text end
new text begin Direct business. new text end
new text begin
(a) "Direct business" means all insurance provided
by an insurance company or its agents, and specifically includes stop-loss insurance
purchased in connection with a self-insurance plan for employee health benefits or for
other purposes, but excludes:
new text end
new text begin
(1) reinsurance in which an insurance company assumes the liability of another
insurance company; and
new text end
new text begin
(2) self-insurance.
new text end
new text begin
(b) For purposes of this subdivision, an insurance company includes a nonprofit
health service corporation, health maintenance organization, and community integrated
service network.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for insurance premiums received
after December 31, 2005.
new text end
Sec. 23.
Minnesota Statutes 2004, section 297I.01, is amended by adding a subdivision
to read:
new text begin Subd. 13a. new text end
new text begin Reinsurance. new text end
new text begin
"Reinsurance" is insurance whereby an insurance
company, for a consideration, agrees to indemnify another insurance company against
all or part of the loss which the latter may sustain under the policy or policies which
it has issued.
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. 24.
Minnesota Statutes 2004, section 297I.05, subdivision 4, is amended to read:
Subd. 4.
Mutual property and casualty companies with total assets less than
$1,600,000,000 on december 31, 1989.
A tax is imposed on mutual property and casualty
companies that had total assets greater than $5,000,000 at the end of the calendar year
but that had total assets less than $1,600,000,000 on December 31, 1989. The rate of
tax is equal to:
(1) deleted text begin two percent of gross premiums less return premiums on all direct business
received by the insurer or agents of the insurer in Minnesota deleted text end new text begin the tax under subdivision 14
new text end for life insurancedeleted text begin , in cash or otherwise, during the yeardeleted text end ; and
(2) 1.26 percent of gross premiums less return premiums on all other direct business
received by the insurer or agents of the insurer in Minnesota, in cash or otherwise, during
the year.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for premiums received after
December 31, 2007.
new text end
Sec. 25.
Minnesota Statutes 2004, section 297I.05, subdivision 5, is amended to read:
Subd. 5.
Health maintenance organizations, nonprofit health service plan
corporations, and community integrated service networks.
(a) deleted text begin Health maintenance
organizations, community integrated service networks, and nonprofit health care service
plan corporations are exempt from the tax imposed under this section for premiums
received in calendar years 2001 to 2003.
deleted text end
deleted text begin (b) For calendar years after 2003,deleted text end A tax is imposed on health maintenance
organizations, community integrated service networks, and nonprofit health care service
plan corporations. The rate of tax is equal to one percent of gross premiums less return
premiums new text begin on all direct business new text end received new text begin by the organization, network, or corporation or
its agents in Minnesota, in cash or otherwise,new text end in the calendar year.
deleted text begin
(c) In approving the premium rates as required in sections 62L.08, subdivision 8,
and 62A.65, subdivision 3, the commissioners of health and commerce shall ensure that
any exemption from tax as described in paragraph (a) is reflected in the premium rate.
deleted text end
deleted text begin (d) deleted text end new text begin (b) new text end The commissioner shall deposit all revenues, including penalties and interest,
collected under this chapter from health maintenance organizations, community integrated
service networks, and nonprofit health service plan corporations in the health care access
fund. Refunds of overpayments of tax imposed by this subdivision must be paid from
the health care access fund. There is annually appropriated from the health care access
fund to the commissioner the amount necessary to make any refunds of the tax imposed
under this subdivision.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective January 1, 2005.
new text end
Sec. 26.
Minnesota Statutes 2004, section 297I.05, is amended by adding a subdivision
to read:
new text begin Subd. 14. new text end
new text begin Life insurance. new text end
new text begin
A tax is imposed on life insurance. The rate of the
tax equals 1.5 percent of gross premiums less return premiums on all direct business
received by the insurer or agents of the insurer in Minnesota for life insurance, in cash or
otherwise, during the year.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for premiums received after
December 31, 2007.
new text end
Sec. 27.
Minnesota Statutes 2004, section 298.24, subdivision 1, is amended to read:
Subdivision 1.
Effective date.
new text begin
This section is effective for direct reduced ore
produced after the day following final enactment.
new text end
Sec. 28. Minnesota Statutes 2004, section 298.75, is amended by adding a
subdivision to read:
new text begin Subd. 10. new text end
new text begin Tax may be imposed, cass county. new text end
new text begin
(a) If Cass County does not impose
a tax under this section, the town of Sylvan in Cass County may impose the aggregate
materials tax under this section.
new text end
new text begin
(b) For purposes of exercising the powers contained in this section, the "town" is
deemed to be the "county."
new text end
new text begin
(c) All provisions in this section apply to the town of Sylvan, except that in lieu of
the distribution of the tax proceeds under subdivision 7, all proceeds of the tax must
be retained by the town.
new text end
new text begin
(d) If Cass County imposes an aggregate materials tax under this section, the tax
imposed by the town of Sylvan under this subdivision is repealed on the effective date
of the Cass County tax.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day after the governing body of
the town of Sylvan and its chief clerical officer comply with Minnesota Statutes, section
645.021, subdivisions 2 and 3.
new text end
Sec. 29. Minnesota Statutes 2004, section 473.843, subdivision 5, is amended
to read:
Subd. 5.
Penalties; enforcement.
The audit, penalty, and enforcement provisions
applicable to new text begin corporate franchise new text end taxes imposed under chapter 290 apply to the fees
imposed under this section. The commissioner of revenue shall administer the provisions.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 30. [FLOOR STOCKS TAX.]
new text begin Subdivision 1. new text end
new text begin Cigarettes. new text end
new text begin
A floor stocks cigarette sales tax is imposed on every
person engaged in the business in this state as a distributor, retailer, subjobber, vendor,
manufacturer, or manufacturer's representative of cigarettes, on the stamped cigarettes and
unaffixed stamps in the person's possession or under the person's control at 12:01 a.m. on
August 1, 2005. The tax is imposed at the rate of 20 cents per pack of 20 cigarettes. For
packs of cigarettes with other than 20 cigarettes, the tax shall be adjusted proportionally.
new text end
new text begin
Each distributor, by August 10, 2005, shall file a return with the commissioner, in the
form the commissioner prescribes, showing the stamped cigarettes and unaffixed stamps
on hand at 12:01 a.m. on August 1, 2005, and the amount of tax due on the cigarettes and
unaffixed stamps. The tax imposed by this section is due and payable by September 7,
2005, and after that date bears interest at the rate of one percent a month.
new text end
new text begin
Each retailer, subjobber, vendor, manufacturer, or manufacturer's representative, by
August 10, 2005, shall file a return with the commissioner, in the form the commissioner
prescribes, showing the cigarettes on hand at 12:01 a.m. on August 1, 2005, and the
amount of tax due on the cigarettes. The tax imposed by this section is due and payable by
September 7, 2005, and after that date bears interest at the rate of one percent a month.
new text end
new text begin Subd. 2. new text end
new text begin Audit and enforcement. new text end
new text begin
The tax imposed by this section is subject to
the audit, assessment, penalty, and collection provisions applicable to the taxes imposed
under Minnesota Statutes, chapter 297F. The commissioner may require a distributor to
receive and maintain copies of floor stocks tax returns filed by all persons requesting
a credit for returned cigarettes.
new text end
new text begin Subd. 3. new text end
new text begin Deposit of proceeds. new text end
new text begin
The revenue from the tax imposed under this
section shall be deposited by the commissioner in the state treasury and credited to the
general fund.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective August 1, 2005.
new text end
Sec. 31. [REPEALER.]
new text begin
Minnesota Statutes 2004, section 297E.12, subdivision 10, is repealed effective the
day following final enactment.
new text end
ARTICLE 9
ECONOMIC DEVELOPMENT
Section 1.
Minnesota Statutes 2004, section 272.02, subdivision 64, is amended to read:
Subd. 64.
Job opportunity building zone property.
(a) Improvements to real
property, and personal property, classified under section 273.13, subdivision 24, and
located within a job opportunity building zone, designated under section 469.314, are
exempt from ad valorem taxes levied under chapter 275.
(b) Improvements to real property, and tangible personal property, of an agricultural
production facility located within an agricultural processing facility zone, designated
under section 469.314, is exempt from ad valorem taxes levied under chapter 275.
(c) For property to qualify for exemption under paragraph (a), the occupant must be
a qualified business, as defined in section 469.310.
(d) The exemption applies beginning for the first assessment year after designation
of the job opportunity building zone by the commissioner of employment and economic
development. The exemption applies to each assessment year that begins during the
duration of the job opportunity building zonedeleted text begin and to property deleted text end new text begin . To be exempt, the property
must be new text end occupied by July 1 of the assessment year by a qualified business new text begin that has signed
the business subsidy agreement and relocation agreement, if required, by July 1 of the
assessment yearnew text end . This exemption does not apply to:
(1) the levy under section 475.61 or similar levy provisions under any other law to
pay general obligation bonds; or
(2) a levy under section 126C.17, if the levy was approved by the voters before the
designation of the job opportunity building zone.
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. 2.
Minnesota Statutes 2004, section 272.0212, subdivision 1, is amended to read:
Subdivision 1.
Exemption.
All qualified property in a zone is exempt to the extent
and for new text begin a period up to new text end the duration provided by the zone designation and under sections
469.1731 to 469.1735.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for development agreements
approved after the day following final enactment and beginning for property taxes payable
in 2006.
new text end
Sec. 3.
Minnesota Statutes 2004, section 272.0212, subdivision 2, is amended to read:
Subd. 2.
Limits on exemption.
new text begin (a) new text end Property in a zone is not exempt under this
section from the following:
(1) special assessments;
(2) ad valorem property taxes specifically levied for the payment of principal and
interest on debt obligations; and
(3) all taxes levied by a school district, except school referendum levies as defined
in section 126C.17.
new text begin
(b) The city may limit the property tax exemption to a shorter period than the
duration of the zone or to a percentage of the property taxes payable or both.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for development agreements
approved after the day following final enactment and beginning for property taxes payable
in 2006.
new text end
Sec. 4.
Minnesota Statutes 2004, section 289A.56, is amended by adding a subdivision
to read:
new text begin Subd. 7. new text end
new text begin
Biotechnology and health sciences industry zone refunds.
new text end
new text begin
Notwithstanding subdivision 3, for refunds payable under section 297A.68, subdivision
38, interest is computed from 90 days after the refund claim is filed with the commissioner.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for refund claims filed on or after
July 1, 2005.
new text end
Sec. 5.
Minnesota Statutes 2004, section 297A.68, subdivision 37, is amended to read:
Subd. 37.
Job opportunity building zones.
(a) Purchases of tangible personal
property or taxable services by a qualified business, as defined in section 469.310, are
exempt if the property or services are primarily used or consumed in a job opportunity
building zone designated under section 469.314. new text begin For purposes of this subdivision, aircraft
that are operated under a Federal Aviation Administration Restricted Airworthiness
Certificate according to Code of Federal Regulations, title 14, part 21, section 21.25(b)(3),
relating to aerial surveying, and that are based, maintained, and dispatched from a
job opportunity building zone, and any aerial camera package, including any camera,
computer, and navigation device contained in the package, that is used in the aircraft,
qualify as primarily used or consumed in a job opportunity building zone if the imagery
acquired from the aerial camera package is returned to the job opportunity building zone
for processing.
new text end
(b) Purchase and use of construction materials and supplies for construction of
improvements to real property in a job opportunity building zone are exempt if the
improvements after completion of construction are to be used in the conduct of a qualified
business, as defined in section 469.310. This exemption applies regardless of whether
the purchases are made by the business or a contractor. new text begin The exemption does not apply
unless the business subsidy agreement entered into pursuant to section 469.313 requires
the prevailing wage to be paid on the construction project.
new text end
(c) The exemptions under this subdivision apply to a local sales and use tax
regardless of whether the local sales tax is imposed on the sales taxable as defined under
this chapter.
(d) This subdivision applies to sales, if the purchase was made and delivery received
during the duration of the zone.
new text begin EFFECTIVE DATE. new text end
new text begin
The amendment to paragraph (a) is effective for sales made
after June 30, 2005.
new text end
Sec. 6.
Minnesota Statutes 2004, section 297A.68, subdivision 38, is amended to read:
Subd. 38.
Biotechnology and health sciences industry zone.
(a) Purchases of
tangible personal property or taxable services by a qualified business, as defined in section
469.330, are exempt if the property or services are primarily used or consumed in a
biotechnology and health sciences industry zone designated under section 469.334.
(b) Purchase and use of construction materials deleted text begin and deleted text end new text begin ,new text end supplies deleted text begin for deleted text end new text begin , or equipment used
or consumed in the new text end construction of improvements to real property in a biotechnology
and health sciences industry zone are exempt if the improvements after completion of
construction are to be used in the conduct of a qualified business, as defined in section
469.330. This exemption applies regardless of whether the purchases are made by the
business or a contractor.
(c) The exemptions under this subdivision apply to a local sales and use tax
regardless of whether the local sales tax is imposed on the sales taxable as defined under
this chapter.
(d)(1) The tax on sales of goods or services exempted under this subdivision are
imposed and collected as if the applicable rate under section 297A.62 applied. Upon
application by the purchaser, on forms prescribed by the commissioner, a refund equal
to the tax paid must be paid to the purchaser. The application must include sufficient
information to permit the commissioner to verify the sales tax paid and the eligibility of
the claimant to receive the credit. No more than two applications for refunds may be filed
under this subdivision in a calendar year. The provisions of section 289A.40 apply to
the refunds payable under this subdivision.
(2) The amount required to make the refunds is annually appropriated to the
commissioner of revenue.
(3) The aggregate amount refunded to a qualified business must not exceed the
amount allocated to the qualified business under section 469.335.
(e) This subdivision applies only to sales made during the duration of the designation
of the zone.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for sales made after December 31,
2003.
new text end
Sec. 7.
Minnesota Statutes 2004, section 469.169, is amended by adding a subdivision
to read:
new text begin Subd. 17. new text end
new text begin Additional border city allocations. new text end
new text begin
(a) In addition to tax reductions
authorized in subdivisions 7 to 16, the commissioner shall allocate $750,000 for tax
reductions to border city enterprise zones in cities located on the western border of the
state. The commissioner shall make allocations to zones in cities on the western border on
a per capita basis. Allocations made under this subdivision may be used for tax reductions
as provided in section 469.171, or for other offsets of taxes imposed on or remitted by
businesses located in the enterprise zone, but only if the municipality determines that the
granting of the tax reduction or offset is necessary in order to retain a business within or
attract a business to the zone. Any portion of the allocation provided in this paragraph
may alternatively be used for tax reductions under section 469.1732 or 469.1734.
new text end
new text begin
(b) The commissioner shall allocate $750,000 for tax reductions under section
469.1732 or 469.1734 to cities with border city enterprise zones located on the western
border of the state. The commissioner shall allocate this amount among the cities on a per
capita basis. Any portion of the allocation provided in this paragraph may alternatively
be used for tax reductions as provided in section 469.171.
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. 8.
Minnesota Statutes 2004, section 469.176, subdivision 4l, is amended to read:
Subd. 4l.
Prohibited facilities.
(a) No tax increment from any district may be
used for:
(1) a commons area used as a public park; deleted text begin or
deleted text end
(2) a facility used for social, recreational, or conference purposesnew text begin ; or
new text end
new text begin (3) a property that includes a casino or other facility conducting class III gaming as
defined in United States Code, title 25, section 2703, regardless of whether it is conducted
by an Indian tribe or tribal businessnew text end .
(b) This subdivision does not apply to a privately owned facility for conference
purposes or a parking structure.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for expenditures of increment made
after June 30, 2005, regardless of when the request for certification of the district was
made.
new text end
Sec. 9.
Minnesota Statutes 2004, section 469.176, subdivision 7, is amended to read:
Subd. 7.
Parcels not includable in districts.
(a) The authority may request
inclusion in a tax increment financing district and the county auditor may certify the
original tax capacity of a parcel or a part of a parcel that qualified under the provisions of
section 273.111 or 273.112 or chapter 473H for taxes payable in any of the five calendar
years before the filing of the request for certification only for:
(1) a district in which 85 percent or more of the planned buildings and facilities
(determined on the basis of square footage) are a qualified manufacturing facility or a
qualified distribution facility or a combination of both; or
(2) a qualified housing district.
(b)(1) A distribution facility means buildings and other improvements to real
property that are used to conduct activities in at least each of the following categories:
(i) to store or warehouse tangible personal property;
(ii) to take orders for shipment, mailing, or delivery;
(iii) to prepare personal property for shipment, mailing, or delivery; and
(iv) to ship, mail, or deliver property.
(2) A manufacturing facility includes space used for manufacturing or producing
tangible personal property, including processing resulting in the change in condition of the
property, and space necessary for and related to the manufacturing activities.
(3) To be a qualified facility, the owner or operator of a manufacturing or distribution
facility must agree to pay and pay 90 percent or more of the employees of the facility at
a rate equal to or greater than 160 percent of the federal minimum wage for individuals
over the age of 20.
new text begin
(c) The authority may not request inclusion in a tax increment financing district and
the county auditor may not certify the original tax capacity of a parcel or a part of a parcel
that contains or is expected to contain uses, facilities, properties, or businesses containing
class III gaming, as defined in United States Code, title 25, section 2703, regardless of
whether it is conducted by an Indian tribe or tribal business.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for parcels for which the request for
certification is made after June 30, 2005.
new text end
Sec. 10.
Minnesota Statutes 2004, section 469.310, subdivision 11, is amended to read:
Subd. 11.
Qualified business.
(a) deleted text begin "Qualified business" means deleted text end A person carrying on
a trade or business at a place of business located within a job opportunity building zone
new text begin is a qualified business for the purposes of sections 469.310 to 469.320 according to the
criteria in paragraphs (b) to (f)new text end .
new text begin
(b) A person is a qualified business only on those parcels of land for which the
person has entered into a business subsidy agreement, as required under section 469.313,
with the appropriate local government unit in which the parcels are located.
new text end
new text begin
(c) Prior to execution of the business subsidy agreement, the local government
unit must consider the following factors:
new text end
new text begin
(1) how wages plus benefits compare to 110 percent of the statewide poverty rate
for a family of four;
new text end
new text begin
(2) how wages compare to the regional industry average;
new text end
new text begin
(3) the number of jobs that will be provided relative to overall employment in the
community;
new text end
new text begin
(4) the economic outlook for the industry the business will engage in;
new text end
new text begin
(5) sales that will be generated from outside the state of Minnesota;
new text end
new text begin
(6) how the business will build on existing regional strengths or diversify the
regional economy;
new text end
new text begin
(7) how the business will increase capital investment in the zone; and
new text end
new text begin
(8) any other criteria the commissioner deems necessary.
new text end
deleted text begin (b) deleted text end new text begin (d) new text end A person that relocates a trade or business from outside a job opportunity
building zone into a zone is not a qualified businessdeleted text begin ,deleted text end unless the business new text begin meets all of the
requirements of paragraphs (b) and (c) andnew text end :
(1) deleted text begin (i) deleted text end increases full-time employment in the first full year of operation within the job
opportunity building zone by deleted text begin at least deleted text end new text begin a minimum of five jobs or new text end 20 percentnew text begin , whichever is
greater,new text end measured relative to the operations that were relocated and maintains the required
level of employment for each year the zone designation applies; deleted text begin or
deleted text end
deleted text begin (ii) makes a capital investment in the property located within a zone equivalent to
ten percent of the gross revenues of operation that were relocated in the immediately
preceding taxable year;deleted text end and
(2) enters a binding written agreement with the commissioner that:
(i) pledges the business will meet the requirements of clause (1);
(ii) provides for repayment of all tax benefits enumerated under section 469.315 to
the business under the procedures in section 469.319, if the requirements of clause (1) are
not met for the taxable year or for taxes payable during the year in which the requirements
were not met; and
(iii) contains any other terms the commissioner determines appropriate.
new text begin
(e) The commissioner may waive the requirements under paragraph (d), clause (1),
if the commissioner determines that the qualified business will substantially achieve
the factors under this subdivision.
new text end
new text begin
(f) A business is not a qualified business if, at its location or locations in the zone,
the business is primarily engaged in making retail sales to purchasers who are physically
present at the business's zone location.
new text end
new text begin
(g) A qualifying business must pay each employee compensation, including benefits
not mandated by law, that on an annualized basis is equal to at least 110 percent of the
federal poverty level for a family of four.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment
and applies to any business entering a business subsidy agreement for a job opportunity
development zone after that date, except that paragraph (b) is effective retroactively from
June 9, 2003.
new text end
Sec. 11.
Minnesota Statutes 2004, section 469.310, is amended by adding a subdivision
to read:
new text begin Subd. 13. new text end
new text begin Relocation payroll percentage. new text end
new text begin
"Relocation payroll percentage" is a
fraction, the numerator of which is the zone payroll of the business for the tax year minus
the payroll from the relocated operations in the last full year of operations prior to the
relocation, and the denominator of which is the zone payroll of the business for the tax
year. The relocation payroll percentage of a business that is not a relocating business
is 100 percent.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment
but applies only to qualified businesses with business subsidy agreements that are fully
executed after June 30, 2005.
new text end
Sec. 12.
Minnesota Statutes 2004, section 469.315, is amended to read:
469.315 TAX INCENTIVES AVAILABLE IN ZONES.
Qualified businesses that operate in a job opportunity building zone, individuals who
invest in a qualified business that operates in a job opportunity building zone, and property
located in a job opportunity building zone qualify for:
(1) exemption from individual income taxes as provided under section 469.316;
(2) exemption from corporate franchise taxes as provided under section 469.317;
(3) exemption from the state sales and use tax and any local sales and use taxes on
qualifying purchases as provided in section 297A.68, subdivision 37;
(4) exemption from the state sales tax on motor vehicles and any local sales tax on
motor vehicles as provided under section 297B.03;
(5) exemption from the property tax as provided in section 272.02, subdivision 64;
(6) exemption from the wind energy production tax under section 272.029,
subdivision 7; and
(7) the jobs credit allowed under section 469.318.
new text begin
The sales tax exemption under section 297A.68, subdivision 37, paragraph (b), is not
"financial assistance" under section 116J.871 or a "business subsidy" under section
116J.993 unless the business subsidy agreement entered into pursuant to section 469.313
requires the payment of the prevailing wage.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective retroactively from January 1, 2004.
new text end
Sec. 13.
Minnesota Statutes 2004, section 469.316, is amended to read:
469.316 INDIVIDUAL INCOME TAX EXEMPTION.
Subdivision 1.
Application.
An individualnew text begin , estate, or trust new text end operating a trade or
business in a job opportunity building zone, and an individualnew text begin , estate, or trust new text end making a
qualifying investment in a qualified business operating in a job opportunity building zone
qualifies for the exemptions from taxes imposed under chapter 290, as provided in this
section. The exemptions provided under this section apply only to the extent that the
income otherwise would be taxable under chapter 290. Subtractions under this section
from federal taxable income, alternative minimum taxable income, or any other base
subject to tax are limited to the amount that otherwise would be included in the tax
base absent the exemption under this section. This section applies only to taxable years
beginning during the duration of the job opportunity building zone.
Subd. 2.
Rents.
An individualnew text begin , estate, or trust new text end is exempt from the taxes imposed
under chapter 290 on net rents derived from real or tangible personal property new text begin used
by a qualified business and new text end located in a zone for a taxable year in which the zone was
designated a job opportunity building zone. If tangible personal property was used both
within and outside of the zone new text begin by the qualified businessnew text end , the exemption amount for the
net rental income must be multiplied by a fraction, the numerator of which is the number
of days the property was used in the zone and the denominator of which is the total days
new text begin the property is rented by the qualified businessnew text end .
Subd. 3.
Business income.
An individualnew text begin , estate, or trust new text end is exempt from the taxes
imposed under chapter 290 on net income from the operation of a qualified business in a
job opportunity building zone. If the trade or business is carried on within and without
the zone and the individual is not a resident of Minnesota, new text begin or the taxpayer is an estate or
trust,new text end the exemption must be apportioned based on the zone percentagenew text begin and the relocation
payroll percentage new text end for the taxable year. If the trade or business is carried on within and
without the zone and the individual is a resident of Minnesota, the exemption must be
apportioned based on the zone percentage new text begin and the relocation payroll percentage new text end for the
taxable year, except the ratios under section 469.310, subdivision 7, clause (1), items (i)
and (ii), must use the denominators of the property and payroll factors determined under
section 290.191. No subtraction is allowed under this section in excess of 20 percent of the
sum of the job opportunity building zone payroll and the adjusted basis of the property at
the time that the property is first used in the job opportunity building zone by the business.
Subd. 4.
Capital gains.
(a) An individualnew text begin , estate, or trust new text end is exempt from the taxes
imposed under chapter 290 on:
(1) net gain derived on a sale or exchange of real property located in the zone and
used by a qualified business. If the property was held by the individualnew text begin , estate, or trust
new text end during a period when the zone was not designated, the gain must be prorated based on
the percentage of time, measured in calendar days, that the real property was held by the
individualnew text begin , estate, or trust new text end during the period the zone designation was in effect to the total
period of time the real property was held by the individual;
(2) net gain derived on a sale or exchange of tangible personal property used by a
qualified business in the zone. If the property was held by the individualnew text begin , estate, or trust
new text end during a period when the zone was not designated, the gain must be prorated based on
the percentage of time, measured in calendar days, that the property was held by the
individualnew text begin , estate, or trust new text end during the period the zone designation was in effect to the total
period of time the property was held by the individual. If the tangible personal property
was used outside of the zone during the period of the zone's designation, the exemption
must be multiplied by a fraction, the numerator of which is the number of days the
property was used in the zone during the time of the designation and the denominator of
which is the total days the property was held during the time of the designation; and
(3) net gain derived on a sale of an ownership interest in a qualified business
operating in the job opportunity building zone, meeting the requirements of paragraph (b).
The exemption on the gain must be multiplied by the zone percentage of the business for
the taxable year prior to the sale.
(b) A qualified business meets the requirements of paragraph (a), clause (3), if
it is a corporation, an S corporation, or a partnership, and for the taxable year its job
opportunity building zone percentage exceeds 25 percent. For purposes of paragraph
(a), clause (3), the zone percentage must be calculated by modifying the ratios under
section 469.310, subdivision 7, clause (1), items (i) and (ii), to use the denominators of
the property and payroll factors determined under section 290.191. Upon the request of
an individualnew text begin , estate, or trust new text end holding an ownership interest in the entity, the entity must
certify to the owner, in writing, the job opportunity building zone percentage needed to
determine the exemption.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2003, except that changes in subdivision 3 relating to the relocation payroll
percentage are effective the day following final enactment and apply only to qualified
businesses with business subsidy agreements that are fully executed after June 30, 2005.
new text end
Sec. 14.
Minnesota Statutes 2004, section 469.317, is amended to read:
469.317 CORPORATE FRANCHISE TAX EXEMPTION.
(a) A qualified business is exempt from taxation under section 290.02, the alternative
minimum tax under section 290.0921, and the minimum fee under section 290.0922,
on the portion of its income attributable to operations within the zone. This exemption
is determined as follows:
(1) for purposes of the tax imposed under section 290.02, by multiplying its taxable
net income by its zone percentage andnew text begin by its relocation payroll percentage and new text end subtracting
the result in determining taxable income;
(2) for purposes of the alternative minimum tax under section 290.0921, by
multiplying its alternative minimum taxable income by its zone percentage and new text begin by its
relocation payroll percentage and new text end reducing alternative minimum taxable income by this
amount; and
(3) for purposes of the minimum fee under section 290.0922, by excluding property
and payroll in the zone from the computations of the fee or by exempting the entity under
section 290.0922, subdivision 2, clause (7).
(b) No subtraction is allowed under this section in excess of 20 percent of the sum
of the corporation's job opportunity building zone payroll and the adjusted basis of the
property at the time that the property is first used in the job opportunity building zone
by the corporation.
(c) This section applies only to taxable years beginning during the duration of the
job opportunity building zone.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment
but applies only to qualified businesses with business subsidy agreements that are fully
executed after June 30, 2005.
new text end
Sec. 15.
Minnesota Statutes 2004, section 469.319, subdivision 1, is amended to read:
Subdivision 1.
Repayment obligation.
A business must repay the amount of the
total tax reduction listed in section 469.315 and any refund under section 469.318 in
excess of tax liability, received during the two years immediately before it ceased to
operate in the zone, if the business:
(1) received tax reductions authorized by section 469.315; and
(2)(i) did not meet the goals specified in an agreement entered into with the applicant
that states any obligation the qualified business must fulfill in order to be eligible for tax
benefits. The commissioner new text begin of employment and economic development new text end may extend for
up to one year the period for meeting any goals provided in an agreement. The applicant
may extend the period for meeting other goals by documenting in writing the reason
for the extension and attaching a copy of the document to its next annual report to the
commissioner new text begin of employment and economic developmentnew text end ; or
(ii) ceased to operate its facility located within the job opportunity building zone or
otherwise ceases to be or is not a qualified business.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 16.
Minnesota Statutes 2004, section 469.319, is amended by adding a subdivision
to read:
new text begin Subd. 6. new text end
new text begin Reconciliation. new text end
new text begin
Where this section is inconsistent with section 116J.994,
subdivision 3, paragraph (e), or 6, or any other provisions of sections 116J.993 to
116J.995, this section prevails.
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. 17.
Minnesota Statutes 2004, section 469.320, subdivision 3, is amended to read:
Subd. 3.
Remedies.
If the commissioner determines, based on a report filed
under subdivision 1 or other available information, that a zone or subzone is failing to
meet its performance goals, the commissioner may take any actions the commissioner
determines appropriate, including modification of the boundaries of the zone or a subzone
or termination of the zone or a subzone. Before taking any action, the commissioner shall
consult with the applicant and the affected local government units, including notifying
them of the proposed actions to be taken. deleted text begin The commissioner shall publish any order
modifying a zone in the State Register and on the Internet.deleted text end The applicant may appeal the
commissioner's order under the contested case procedures of chapter 14.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 18.
Minnesota Statutes 2004, section 469.330, subdivision 11, is amended to read:
Subd. 11.
Qualified business.
(a) "Qualified business" means a person carrying on
a trade or business at a biotechnology and health sciences industry facility located within a
biotechnology and health sciences industry zone. new text begin A person is a qualified business only
on those parcels of land for which it has entered into a business subsidy agreement, as
required under section 469.333, with the appropriate local government unit in which the
parcels are located.
new text end
(b) A person that relocates a biotechnology and health sciences industry facility from
outside a biotechnology and health sciences industry zone into a zone is not a qualified
business, unless the business:
(1)(i) increases full-time employment in the first full year of operation within the
biotechnology and health sciences industry zone by at least 20 percent measured relative
to the operations that were relocated and maintains the required level of employment for
each year the zone designation applies; or
(ii) makes a capital investment in the property located within a zone equivalent to
ten percent of the gross revenues of operation that were relocated in the immediately
preceding taxable year; and
(2) enters a binding written agreement with the commissioner that:
(i) pledges the business will meet the requirements of clause (1);
(ii) provides for repayment of all tax benefits enumerated under section 469.336 to
the business under the procedures in section 469.340, if the requirements of clause (1)
are not met; and
(iii) contains any other terms the commissioner determines appropriate.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective retroactively from June 9, 2003.
new text end
Sec. 19.
Minnesota Statutes 2004, section 469.335, is amended to read:
469.335 APPLICATION FOR TAX BENEFITS.
(a) To claim a tax credit or exemption against a state tax under section 469.336,
clauses (2) through (5), a business must apply to the commissioner for a tax credit
certificate. As a condition of its application, the business must agree to furnish information
to the commissioner that is sufficient to verify the eligibility for any credits or exemptions
claimed. The total amount of the state tax credits and exemptions allowed for the
specified period may not exceed the amount of the tax credit certificates provided by the
commissioner to the business. The commissioner must verify to the commissioner of
revenue the amount of tax exemptions or credits for which each business is eligible.
(b) A tax credit certificate issued under this section may specify the particular tax
exemptions or credits against a state tax that the qualified business is eligible to claim
under section 469.336, clauses (2) through (5), and the amount of each exemption or
credit allowed.
(c) The commissioner may issue $1,000,000 of tax credits or exemptions in fiscal
year 2004. Any tax credits or exemptions not awarded in fiscal year 2004 may be awarded
in fiscal year 2005. new text begin Any tax credits or exemptions not awarded in fiscal year 2004 or 2005
do not cancel and may be awarded in fiscal years 2006 and 2007.
new text end
(d) A qualified business must use the tax credits or tax exemptions granted under
this section by the later of the end of the state fiscal year or the taxpayer's tax year in
which the credits or exemptions are granted.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 20.
Minnesota Statutes 2004, section 469.337, is amended to read:
469.337 CORPORATE FRANCHISE TAX EXEMPTION.
(a) A qualified business is exempt from taxation under section 290.02, the alternative
minimum tax under section 290.0921, and the minimum fee under section 290.0922, on
the portion of its income attributable to operations of a qualified business within the
biotechnology and health sciences industry zone. This exemption is determined as follows:
(1) for purposes of the tax imposed under section 290.02, by multiplying its taxable
net income by its zone percentage and subtracting the result in determining taxable income;
(2) for purposes of the alternative minimum tax under section 290.0921, by
multiplying its alternative minimum taxable income by its zone percentage and reducing
alternative minimum taxable income by this amount; and
(3) for purposes of the minimum fee under section 290.0922, by excluding new text begin zone
new text end property and payroll deleted text begin in the zone deleted text end from the computations of the fee. new text begin The qualified business
is exempt from the minimum fee if all of its property is located in the zone and all of its
payroll is zone payroll.
new text end
(b) No subtraction is allowed under this section in excess of 20 percent of the sum of
the corporation's biotechnology and health sciences industry zone payroll and the adjusted
basis of the property at the time that the property is first used in the biotechnology and
health sciences industry zone by the corporation.
(c) No reduction in tax is allowed in excess of the amount allocated under section
469.335.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for tax years beginning after
December 31, 2003.
new text end
Sec. 21.
Minnesota Statutes 2004, section 469.340, subdivision 1, is amended to read:
Subdivision 1.
Repayment obligation.
A business must repay the amount of the tax
reduction listed in section 469.336 and any refunds under sections 469.338 and 469.339
in excess of tax liability, received during the two years immediately before it ceased to
operate in the zone, if the business:
(1) received tax reductions authorized by section 469.336; and
(2)(i) did not meet the goals specified in an agreement entered into with the applicant
that states any obligation the qualified business must fulfill in order to be eligible for tax
benefits. The commissioner new text begin of employment and economic development new text end may extend for
up to one year the period for meeting any goals provided in an agreement. The applicant
may extend the period for meeting other goals by documenting in writing the reason
for the extension and attaching a copy of the document to its next annual report to the
commissioner new text begin of employment and economic developmentnew text end ; or
(ii) ceased to operate its facility located within the biotechnology and health sciences
industry zone or otherwise ceases to be or is not a qualified business.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 22. new text begin FERGUS FALLS; ECONOMIC DEVELOPMENT.
new text end
new text begin
Notwithstanding the time limits in Minnesota Statutes 2004, section 272.02,
subdivision 39, the holding of property by the city of Fergus Falls for later resale for
economic development purposes is considered a public purpose for purposes of Minnesota
Statutes, section 272.02, subdivision 8, for a period not to exceed 15 years. The other
requirements of Minnesota Statutes, section 272.02, subdivision 39, apply to property
held by the city under this section.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day after approval by the
governing body of the city of Fergus Falls and compliance with Minnesota Statutes,
section 645.021, subdivision 3.
new text end
Sec. 23. new text begin CITY OF TAYLORS FALLS; BORDER CITY DEVELOPMENT ZONE.
new text end
new text begin Subdivision 1. new text end
new text begin Authorization. new text end
new text begin
The governing body of the city of Taylors Falls may
designate all or any part of the city as a border city development zone.
new text end
new text begin Subd. 2. new text end
new text begin Application of general law. new text end
new text begin
(a) Minnesota Statutes, sections 469.1731 to
469.1735, apply to the border city development zones designated under this section. The
governing body of the city may exercise the powers granted under Minnesota Statutes,
sections 469.1731 to 469.1735, including powers that apply outside of the zones.
new text end
new text begin
(b) The allocation under subdivision 3 for purposes of Minnesota Statutes, section
469.1735, subdivision 2, is appropriated to the commissioner of revenue.
new text end
new text begin Subd. 3. new text end
new text begin Allocation of state tax reductions. new text end
new text begin
(a) The cumulative total amount of the
state portion of the tax reductions for all years of the program under Minnesota Statutes,
sections 469.1731 to 469.1735, for the city of Taylors Falls, is limited to $100,000.
new text end
new text begin
(b) This allocation may be used for tax reductions provided in Minnesota Statutes,
section 469.1732 or 469.1734, or for reimbursements under Minnesota Statutes, section
469.1735, subdivision 3, but only if the governing body of the city of Taylors Falls
determines that the tax reduction or offset is necessary to enable a business to expand
within the city or to attract a business to the city.
new text end
new text begin
(c) The commissioner of revenue may waive the limit under this subdivision using
the same rules and standards provided in Minnesota Statutes, section 469.169, subdivision
12, paragraph (b).
new text end
[EFFECTIVE DATE; LOCAL APPROVAL.]
new text begin
This section is effective upon
approval by a majority of the voters of the city of Taylors Falls voting on the question at
a general election.
new text end
Sec. 24. new text begin REVISOR'S INSTRUCTION.
new text end
new text begin
The revisor shall renumber Minnesota Statutes, section 469.310, subdivision 11, as
section 469.3135, and insert the following definition of "qualified business" in Minnesota
Statutes, section 469.310: "'Qualified business' means the entity described in section
469.3135."
new text end
Sec. 25. new text begin REPEALER.
new text end
new text begin
Minnesota Statutes 2004, section 272.02, subdivision 65, is repealed effective for
taxes payable in 2006 and thereafter. Minnesota Statutes 2004, section 477A.08, is
repealed effective for aid payable in 2005 and thereafter.
new text end
ARTICLE 10
TAX SHELTERS
Section 1.
new text begin
[270.103] EQUITABLE ACTIONS.
new text end
new text begin
(a) The commissioner may bring a civil action to enjoin any person from taking
action or failing to take action that is subject to penalty under section 289A.60,
subdivisions 7, 20, 20a, 26, 27, and 28.
new text end
new text begin
(b) In any action under paragraph (a), the court may enjoin the person from engaging
in the conduct, if the court finds that:
new text end
new text begin
(1) the person has engaged in the specified conduct; and
new text end
new text begin
(2) injunctive relief is appropriate to prevent recurrence of the conduct.
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. 2.
new text begin
[289A.121] TAX SHELTERS SPECIAL RULES.
new text end
new text begin Subdivision 1. new text end
new text begin Scope. new text end
new text begin
The provisions of this section apply to a tax shelter that:
new text end
new text begin
(1) is organized in this state;
new text end
new text begin
(2) is doing business in this state;
new text end
new text begin
(3) is deriving income from sources in this state; or
new text end
new text begin
(4) has one or more investors that are Minnesota taxpayers under chapter 290.
new text end
new text begin Subd. 2. new text end
new text begin Definitions. new text end
new text begin
(a) For purposes of this section, the definitions under sections
6111 and 6112 of the Internal Revenue Code, including the regulations under those
sections, apply.
new text end
new text begin
(b) The term "tax shelter" includes any reportable transaction under subdivision 5.
new text end
new text begin Subd. 3. new text end
new text begin Registration. new text end
new text begin
(a) Any tax shelter organizer required to register a tax
shelter under section 6111 of the Internal Revenue Code must register the shelter with
the commissioner.
new text end
new text begin
(b) A tax shelter organizer subject to this subdivision must send a duplicate of the
federal registration information, along with any other information the commissioner
requires, to the commissioner not later than the day on which interests in that tax shelter
are first offered for sale.
new text end
new text begin
(c) In addition to the requirements under paragraph (b), any listed transactions must
be registered with the commissioner by the latest of:
new text end
new text begin
(1) 60 days after entering into the transaction;
new text end
new text begin
(2) 60 days after the transaction becomes a listed transaction; or
new text end
new text begin
(3) December 31, 2005.
new text end
new text begin Subd. 4. new text end
new text begin Registration number. new text end
new text begin
(a) Any person required to register under section
6111 of the Internal Revenue Code who receives a tax registration number from the
Secretary of the Treasury must, within 30 days after requested by the commissioner, file a
statement of that registration number with the commissioner.
new text end
new text begin
(b) Any person who sells or otherwise transfers an interest in a tax shelter must, in
the same time and manner required under section 6111(b) of the Internal Revenue Code,
furnish to each investor who purchases or otherwise acquires an interest in the tax shelter
the identification number assigned under federal law to the tax shelter.
new text end
new text begin
(c) Any person claiming any deduction, credit, or other tax benefit by reason of a tax
shelter must include on the return of tax on which the deduction, credit, or other benefit is
claimed the identification number assigned under federal law to the tax shelter.
new text end
new text begin Subd. 5. new text end
new text begin Reportable transactions. new text end
new text begin
(a) For each taxable year in which a taxpayer
must make a disclosure statement under Code of Federal Regulations, title 26, section
1.6011-4, for a reportable transaction, including a listed transaction, in which the taxpayer
participated in a taxable year for which a return is required under chapter 290, the taxpayer
must file a copy of the disclosure with the commissioner.
new text end
new text begin
(b) Any taxpayer that is a member of a unitary business group that includes any
person that must make a disclosure statement under Code of Federal Regulations, title 26,
section 1.6011-4, must file a disclosure under this subdivision.
new text end
new text begin
(c) Disclosure under this subdivision is required for any transaction entered into after
December 31, 2001, that the Internal Revenue Service determines is a listed transaction
at any time, and must be made in the manner prescribed by the commissioner. For
transactions in which the taxpayer participated for taxable years ending before December
31, 2005, disclosure must be made by the due date of the first return required under
chapter 290 after the enactment of this section. With respect to transactions in which the
taxpayer participated for taxable years ending on and after December 31, 2005, disclosure
must be made in the time and manner prescribed in the Code of Federal Regulations, title
26, section 1.6011-4(e).
new text end
new text begin
(d) Notwithstanding paragraphs (a) to (c), no disclosure is required for transactions
entered into after December 31, 2001, and before January 1, 2006, (1) if the taxpayer has
filed an amended income tax return which reverses the tax benefits of the potential tax
avoidance transaction, or (2) as a result of a federal audit the Internal Revenue Service
has determined the tax treatment of the transaction and an amended return has been filed
to reflect the federal treatment.
new text end
new text begin Subd. 6. new text end
new text begin Abusive shelters; lists of investors. new text end
new text begin
(a) Any person required to maintain a
list under section 6112 of the Internal Revenue Code with respect to a potentially abusive
tax shelter must furnish the list to the commissioner no later than when required under
federal law. The list required under this subdivision must include the same information
required with respect to a potentially abusive tax shelter under Code of Federal
Regulations, title 26, section 301.6112-1, and any other information the commissioner
requires.
new text end
new text begin
(b) For transactions entered into on or after December 31, 2001, that become listed
transactions at any time, the list must be furnished to the commissioner by the latest of:
new text end
new text begin
(1) 60 days after entering into the transaction;
new text end
new text begin
(2) 60 days after the transaction becomes a listed transaction; or
new text end
new text begin
(3) December 31, 2005.
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.
Minnesota Statutes 2004, section 289A.38, is amended by adding a subdivision
to read:
new text begin Subd. 15. new text end
new text begin Reportable transactions. new text end
new text begin
If a taxpayer fails to include on any return or
statement for any taxable year any information with respect to a reportable transaction, as
required by federal law and under section 289A.121, subdivision 5, the commissioner may
recompute the tax, including a refund, within six years after the return is filed with respect
to the taxable year in which the taxpayer participated in the reportable transaction. If tax is
assessable solely because of this section, the assessable deficiency is limited to the items
that were not disclosed as required under section 289A.121, subdivision 5.
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. 4.
Minnesota Statutes 2004, section 289A.60, subdivision 4, is amended to read:
Subd. 4.
Substantial understatement of liability; penalty.
new text begin (a) new text end The commissioner
of revenue shall impose a penalty for substantial understatement of any tax payable to the
commissioner, except a tax imposed under chapter 297A.
new text begin (b) new text end There must be added to the tax an amount equal to 20 percent of the amount of any
underpayment attributable to the understatement. There is a substantial understatement of
tax for the period if the amount of the understatement for the period exceeds the greater of:
(1) ten percent of the tax required to be shown on the return for the period; or
(2) deleted text begin (a) deleted text end new text begin (i) new text end $10,000 in the case of a mining company or a corporation, other than an
S corporation as defined in section 290.9725, when the tax is imposed by chapter 290
new text begin or section 298.01 or 298.015new text end , or
deleted text begin (b) deleted text end new text begin (ii) new text end $5,000 in the case of any other taxpayer, and in the case of a mining company
or a corporation any tax not imposed by chapter 290 or section 298.01 or 298.015.
new text begin
(c) For a corporation, other than an S corporation, that has been contacted by the
commissioner regarding the use of a potentially abusive tax shelter, as defined under
section 289A.121, there is also a substantial understatement of tax for any taxable year if
the amount of the understatement for the taxable year exceeds the lesser of:
new text end
new text begin
(1) ten percent of the tax required to be shown on the return for the taxable year
(or, if greater, $2,500); or
new text end
new text begin
(2) $5,000,000.
new text end
new text begin (d) new text end The term "understatement" means the excess of the amount of the tax required to
be shown on the return for the period, over the amount of the tax imposed that is shown
on the return. The amount of the understatement shall be reduced by that part of the
understatement that is attributable to the tax treatment of any item by the taxpayer if
there is or was substantial authority for the treatment, or any item with respect to which
the relevant facts affecting the item's tax treatment are adequately disclosed in the return
or in a statement attached to the return. The special rules in cases involving tax shelters
provided in section 6662(d)(2)(C) of the Internal Revenue Code shall apply and shall
apply to a tax shelter the principal purpose of which is the avoidance or evasion of state
taxes. The commissioner may abate all or any part of the addition to the tax provided
by this section on a showing by the taxpayer that there was reasonable cause for the
understatement, or part of it, and that the taxpayer acted in good faith. The additional tax
and penalty shall bear interest at the rate specified in section 270.75 from the time the tax
should have been paid until paid.
new text begin
(e) For taxpayers that have been contacted by the commissioner regarding the use of
a potentially abusive tax shelter within the meaning of section 298A.121, the amount of
the understatement is reduced by that part of the understatement that is attributable to the
tax treatment of any item by the taxpayer if the taxpayer had reasonable belief that the
tax treatment was more likely than not the proper treatment or if any item with respect to
which the relevant facts affecting the item's tax treatment are adequately disclosed in the
return or in a statement attached to the return.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxpayers contacted by the
commissioner after the day following final enactment.
new text end
Sec. 5.
Minnesota Statutes 2004, section 289A.60, subdivision 7, is amended to read:
Subd. 7.
Penalty for frivolous return.
new text begin (a) new text end If a taxpayer files what purports to
be a tax return or a claim for refund but which does not contain information on which
the substantial correctness of the purported return or claim for refund may be judged or
contains information that on its face shows that the purported return or claim for refund is
substantially incorrect and the conduct is due to a position that is frivolous or a desire that
appears on the purported return or claim for refund to delay or impede the administration
of Minnesota tax laws, then the individual shall pay a penalty of the greater of $1,000 or
25 percent of the amount of tax required to be shown on the return. In a proceeding
involving the issue of whether or not a person is liable for this penalty, the burden of proof
is on the commissioner.
new text begin
(b) If the taxpayer has been contacted by the commissioner of revenue regarding
the use of a potentially abusive tax shelter within the meaning of section 289A.121, the
penalty under this subdivision is the greater of $5,000 or 25 percent of the amount of tax
required to be shown on the return.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for returns or claims filed after the
day following final enactment.
new text end
Sec. 6.
Minnesota Statutes 2004, section 289A.60, subdivision 20, is amended to read:
Subd. 20.
Penalty for promoting abusive tax shelters.
Any person who:
(1)(i) organizes or assists in the organization of a partnership or other entity, an
investment plan or arrangement, or any other plan or arrangement, or (ii) participates in
the sale of any interest in an entity or plan or arrangement referred to in clause (i); and
(2) makes or furnishes in connection with the organization or sale a statement
with respect to the allowability of a deduction or credit, the excludability of income,
or the securing of any other tax benefit by reason of holding an interest in the entity or
participating in the plan or arrangement that the person knows or has reason to know
is false or fraudulent concerning any material matter, shall pay a penalty equal to the
greater of $1,000 or deleted text begin 20 deleted text end new text begin 50 new text end percent of the gross income derived or to be derived by the
person from the activity.
The penalty imposed by this subdivision is in addition to any other penalty provided
by this section. The penalty must be collected in the same manner as any delinquent
income tax. In a proceeding involving the issue of whether or not any person is liable for
this penalty, the burden of proof is upon the commissioner.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for transactions entered into after the
day following final enactment.
new text end
Sec. 7.
Minnesota Statutes 2004, section 289A.60, is amended by adding a subdivision
to read:
new text begin Subd. 20a. new text end
new text begin Aiding and abetting understating of tax liability. new text end
new text begin
(a) A penalty in the
amount under paragraph (b) for each document is imposed on each person who:
new text end
new text begin
(1) aids or assists in, procures, or advises with respect to, the preparation or
presentation of any portion of a return, affidavit, claim, or other document;
new text end
new text begin
(2) knows or has reason to believe that the portion of a return, affidavit, claim, or
other document will be used in connection with any material matter arising under the
Minnesota individual income or corporate franchise tax; and
new text end
new text begin
(3) knows that the portion, if so used, would result in an understatement of the
liability for tax of another person.
new text end
new text begin
(b)(1) Except as provided in clause (2), the amount of the penalty imposed by this
subdivision is $1,000.
new text end
new text begin
(2) If the return, affidavit, claim, or other document relates to the tax liability of a
corporation, the amount of the penalty imposed by paragraph (a) is $10,000.
new text end
new text begin
(3) If any person is subject to a penalty under paragraph (a) for any document
relating to any taxpayer for any taxable period or taxable event, the person is not subject
to a penalty under paragraph (a) for any other document relating to the taxpayer for the
taxable period or event.
new text end
new text begin
(c) For purposes of this subdivision, "procures" includes (i) ordering or otherwise
causing any other person to do an act, and (ii) knowing of, and not attempting to prevent,
participation by any other person in an act.
new text end
new text begin
(d) The penalty under this subdivision applies whether or not the understatement
is with the knowledge or consent of the persons authorized or required to present the
return, affidavit, claim, or other document.
new text end
new text begin
(e) For purposes of paragraph (a), clause (1), a person furnishing typing, reproducing,
or other mechanical assistance with respect to a document is not treated as having aided or
assisted in the preparation of the document by reason of the assistance.
new text end
new text begin
(f)(1) Except as provided by clause (2), the penalty imposed by this section is in
addition to any other penalty provided by law.
new text end
new text begin
(2) No penalty applies under subdivision 20 to any person for any document for
which a penalty is assessed on the person under this subdivision.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for documents prepared after the
day following final enactment.
new text end
Sec. 8.
Minnesota Statutes 2004, section 289A.60, is amended by adding a subdivision
to read:
new text begin Subd. 26. new text end
new text begin Tax shelter penalties; registration and listing. new text end
new text begin
(a) For purposes of
this subdivision, "material advisor" has the meaning given it under Code of Federal
Regulations, title 26, section 301.6112-1(c)(2).
new text end
new text begin
(b) The penalties in this subdivision apply in connection with the use of tax shelters,
as defined under section 289A.121.
new text end
new text begin
(c) A person who fails to register a tax shelter, including providing all of the required
information under section 289A.121, subdivision 3, is subject to a penalty of $15,000.
If the tax shelter is a listed shelter and disclosure is not made as required by section
289A.121, subdivision 5, a penalty applies equal to the greater of:
new text end
new text begin
(1) $100,000;
new text end
new text begin
(2) 50 percent of the gross income that the organizer or material advisor derived
from that activity; or
new text end
new text begin
(3) 75 percent of the gross income that the organizer or material advisor derived
from that activity if the organizer or material advisor intentionally failed to act.
new text end
new text begin
(d) Any person who fails to supply a tax shelter registration number required under
section 289A.121, subdivision 4, paragraph (b), is subject to a penalty of $100 for each
failure. Any person who fails to include a tax shelter registration number on a return as
required under section 289A.121, subdivision 4, paragraph (c), is subject to a penalty of
$250 for each failure, unless the failure was due to reasonable cause. The penalties under
this paragraph are in addition to any penalties under paragraph (c).
new text end
new text begin
(e) The person required to maintain or provide a list under section 289A.121,
subdivision 6, is subject to a penalty equal to:
new text end
new text begin
(1) for reportable transactions, $10,000 for each day after the 20th day that the
organizer or material advisor failed to make the list available to the commissioner after
written request for that list was made; and
new text end
new text begin
(2) for listed transactions, the greater of:
new text end
new text begin
(i) $100,000; or
new text end
new text begin
(ii) 50 percent of the gross income that the organizer or material advisor derived
from that activity.
new text end
new text begin
(f) The penalty imposed by this subdivision is in addition to any penalty imposed
under this section.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxable years beginning after
December 31, 2000.
new text end
Sec. 9.
Minnesota Statutes 2004, section 289A.60, is amended by adding a subdivision
to read:
new text begin Subd. 27. new text end
new text begin Failure to report; reportable transaction. new text end
new text begin
(a) Any large entity or high
net worth individual who fails to include on any return or statement any information with
respect to a reportable transaction that is required under section 6011 of the Internal
Revenue Code and under section 289A.121, to be included with that return or statement
must pay a penalty for each omission in the amount determined under paragraph (b).
new text end
new text begin
(b) The penalty is $15,000, except for a listed transaction the penalty is $30,000.
new text end
new text begin
(c) For purposes of this subdivision:
new text end
new text begin
(1) "High net worth individual" means, for a transaction, an individual whose net
worth exceeds $2,000,000 immediately before the transaction.
new text end
new text begin
(2) "Large entity" means, for any taxable year, a person, other than an individual,
with gross receipts in excess of $10,000,000 for either the taxable year in which the
reportable transaction occurs or in the preceding taxable year. Rules similar to the rules
of section 448(c)(2) and 448(c)(3) of the Internal Revenue Code, other than section
448(c)(3)(A) of the Internal Revenue Code, apply.
new text end
new text begin
(3) "Reportable transaction" means a reportable transaction under section 289A.121,
subdivision 5.
new text end
new text begin
(4) Except as provided in regulations prescribed by the Secretary of the Treasury, the
term "listed transaction" means a reportable transaction, as defined in clause (3), that is the
same as, or substantially similar to, a transaction specifically identified by the Secretary of
the Treasury for purposes of section 6011 of the Internal Revenue Code for federal income
tax purposes as a tax avoidance transaction.
new text end
new text begin
(d) The penalty imposed by this subdivision is in addition to any penalty imposed
under this section.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxable years beginning after
December 31, 2000.
new text end
Sec. 10.
Minnesota Statutes 2004, section 289A.60, is amended by adding a
subdivision to read:
new text begin Subd. 28. new text end
new text begin Reportable transaction understatement. new text end
new text begin
(a) If a taxpayer has a
reportable transaction understatement for any taxable year, an amount equal to 20 percent
of the amount of the understatement must be added to the tax.
new text end
new text begin
(b)(1) For purposes of this subdivision, "reportable transaction understatement"
means the product of:
new text end
new text begin
(i) the amount of the increase, if any, in taxable income that results from a difference
between the proper tax treatment of an item to which this section applies and the
taxpayer's treatment of that item as shown on the taxpayer's tax return; and
new text end
new text begin
(ii) the highest rate of tax imposed on the taxpayer under section 290.06.
new text end
new text begin
(2) For purposes of clause (1)(i), any reduction of the excess of deductions allowed
for the taxable year over gross income for that year, and any reduction in the amount of
capital losses which would, without regard to section 1211 of the Internal Revenue Code,
be allowed for that year, must be treated as an increase in taxable income.
new text end
new text begin
(c) This subdivision applies to any item that is attributable to:
new text end
new text begin
(1) any listed transaction under section 289A.121; and
new text end
new text begin
(2) any reportable transaction, other than a listed transaction, if a significant purpose
of that transaction is the avoidance or evasion of federal income tax liability.
new text end
new text begin
(d) The penalty imposed by this subdivision is in addition to any penalty imposed
under this section.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxable years beginning after
December 31, 2000.
new text end
Sec. 11.
Minnesota Statutes 2004, section 289A.60, is amended by adding a
subdivision to read:
new text begin Subd. 29. new text end
new text begin Addition to tax. new text end
new text begin
(a) If a taxpayer has been contacted by the commissioner
regarding the use of a potentially abusive tax shelter and has a deficiency, there must be
added to the tax an amount equal to 100 percent of the interest payable under section
270.75 for the period beginning on the last date prescribed by law for the payment of
that tax, determined without regard to extensions, and ending on the date the notice of
proposed assessment is mailed.
new text end
new text begin
(b) "Potentially abusive tax shelter" means:
new text end
new text begin
(1) any tax shelter, as defined in section 6111 of the Internal Revenue Code, for
which registration is required under section 289A.121; or
new text end
new text begin
(2) any entity, investment plan or arrangement, or other plan or arrangement which
is of a type that the Secretary of the Treasury determines by regulations as having a
potential for tax avoidance or evasion.
new text end
new text begin
(c) The penalty imposed by this subdivision is in addition to any other penalty
imposed under this section and to the interest computation for purposes of section 270.75.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for notices of proposed assessments
mailed after the day following final enactment.
new text end
Sec. 12.
Minnesota Statutes 2004, section 289A.60, is amended by adding a
subdivision to read:
new text begin Subd. 30. new text end
new text begin Authority to abate tax shelter penalties. new text end
new text begin
(a) Notwithstanding section
270.07, the commissioner may abate all or any portion of any penalty imposed by
subdivisions 20, 20a, and 26 to 29 for any violation, only if all of the following apply:
new text end
new text begin
(1) the violation is for a reportable transaction, other than a listed transaction, as
defined under Code of Federal Regulations, title 26, section 6011-4;
new text end
new text begin
(2) the person on whom the penalty is imposed has a history of complying with the
requirements of this chapter and chapter 290;
new text end
new text begin
(3) the violation is due to an unintentional mistake of fact;
new text end
new text begin
(4) imposing the penalty would be against equity and good conscience; and
new text end
new text begin
(5) abating the penalty would promote compliance with the requirements of chapter
290.
new text end
new text begin
(b) The exercise of authority under paragraph (a) is at the sole discretion of
the commissioner and may not be delegated. Notwithstanding any other law or rule,
a determination under this subdivision may not be reviewed in any administrative or
judicial proceeding.
new text end
Sec. 13.
Minnesota Statutes 2004, section 289A.60, is amended by adding a
subdivision to read:
new text begin Subd. 31. new text end
new text begin Interest computation. new text end
new text begin
For an amended return filed after December
31, 2005, and before the taxpayer is contacted by the Internal Revenue Service or the
commissioner regarding a potentially abusive tax shelter, then, for taxable years beginning
after December 31, 2001, with respect to any understatement of tax related to using
reportable transactions as defined in section 289A.121, the taxpayer is subject to interest at
a rate of 150 percent of the applicable rate under section 270.75.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for taxable years beginning after
December 31, 2005.
new text end
Sec. 14. new text begin VOLUNTARY COMPLIANCE INITIATIVE.
new text end
new text begin Subdivision 1. new text end
new text begin Establishment. new text end
new text begin
The commissioner of revenue shall establish and
administer a voluntary compliance initiative for taxpayers subject to Minnesota Statutes,
section 289A.60, subdivision 26, 27, or 28.
new text end
new text begin Subd. 2. new text end
new text begin Time period; scope. new text end
new text begin
(a) The commissioner shall conduct the voluntary
compliance initiative from July 1, 2005, to December 31, 2005, under Minnesota Statutes,
section 270.07.
new text end
new text begin
(b) The voluntary compliance initiative applies to tax liabilities and penalties
attributable to an abusive tax avoidance transaction for taxable years beginning before
January 1, 2005. An abusive tax avoidance transaction means a listed transaction, a
potentially abusive tax shelter, or a reportable transaction as those terms are used in
Minnesota Statutes, section 289A.121.
new text end
new text begin Subd. 3. new text end
new text begin Eligibility. new text end
new text begin
(a) No person may participate in the voluntary compliance
initiative, if:
new text end
new text begin
(1) the taxpayer was convicted of a crime in connection with an abusive tax
avoidance transaction or transactions;
new text end
new text begin
(2) a criminal complaint was filed against the taxpayer in connection with an abusive
tax avoidance transaction or transactions;
new text end
new text begin
(3) the taxpayer is the subject of a criminal investigation in connection with an
abusive tax avoidance transaction or transactions; or
new text end
new text begin
(4) the taxpayer was eligible to participate in the Internal Revenue Service's
Offshore Voluntary Compliance Initiative, as set forth in Revenue Procedure 2003-11.
new text end
new text begin
(b) A person not disqualified under paragraph (a) may participate in the voluntary
compliance initiative.
new text end
new text begin Subd. 4. new text end
new text begin Election; commissioner authority. new text end
new text begin
(a) An eligible taxpayer that meets the
requirements of subdivision 3 with respect to any taxable year may elect to participate
in the voluntary compliance program under either subdivision 5 or 6 for a particular tax
avoidance period. The election must be made separately for each taxable year and in the
form and manner prescribed by the commissioner, and once made is irrevocable.
new text end
new text begin
(b) The commissioner of revenue may issue forms and instructions and take other
actions necessary, including the use of agreements under Minnesota Statutes, section
270.67, to implement the voluntary compliance initiative.
new text end
new text begin Subd. 5. new text end
new text begin Participation without right of appeal. new text end
new text begin
(a) A person participating in the
voluntary compliance initiative under this subdivision waives the right to an administrative
appeal, to a claim for refund, or to file an action in district court or tax court. The person
participating must:
new text end
new text begin
(1) file an amended return for each taxable year for which the taxpayer has filed a
tax return using an abusive tax avoidance transaction to underreport the taxpayer's tax
liability for the taxable year. Each amended return must report all income from all sources,
without regard to the abusive tax avoidance transactions; and
new text end
new text begin
(2) pay taxes and interest due in full, except that the commissioner of revenue may
enter into an installment payment agreement under Minnesota Statutes, section 270.67,
before the taxpayer files an amended return.
new text end
new text begin
(b) The commissioner of revenue shall abate all penalties imposed under Minnesota
Statutes, chapter 289A, which could have been assessed in connection with the use of an
abusive tax avoidance transaction, for each taxable year for which the taxpayer elects to
participate in the voluntary compliance initiative under this subdivision, to the extent
those penalties are a result of underreporting of tax liabilities attributable to the use of
abusive tax avoidance transactions, for which a participating person files an amended
return in compliance with paragraph (a).
new text end
new text begin
(c) No criminal action must be brought against a taxpayer for the taxable years
reported under the voluntary compliance initiative with respect to the issues for which a
taxpayer voluntarily complies under this chapter.
new text end
new text begin
(d) A person filing an amended return under this subdivision of the voluntary
compliance initiative may not file a claim for refund, an administrative appeal, or an action
in district court with regard to the amount of taxes or interest paid with the amended
return. Nothing in this subdivision precludes a taxpayer from filing a claim for credit or
refund for the same taxable year in which a tax avoidance transaction was reported if the
credit or refund is not attributable to the tax avoidance transaction.
new text end
new text begin Subd. 6. new text end
new text begin Participation with right of appeal. new text end
new text begin
(a) A person participating in the
voluntary compliance initiative who does not waive the right to an administrative appeal,
a claim for refund, or an action in district court must:
new text end
new text begin
(1) file an amended return for each taxable year for which the taxpayer has filed
a tax return using an abusive tax avoidance transaction to underreport the taxpayer's
tax liability for that taxable year. Each amended return must report all income from all
sources, without regard to the abusive tax avoidance transactions; and
new text end
new text begin
(2) pay taxes and interest due in full, except that the commissioner of revenue may
enter into an installment payment agreement pursuant to Minnesota Statutes, section
270.67, prior to the taxpayer filing an amended return.
new text end
new text begin
(b) The commissioner of revenue shall abate all penalties imposed under Minnesota
Statutes, chapter 289A, except for the penalty for substantial understatement of tax
liability under Minnesota Statutes, section 289A.60, subdivision 4, determined without
regard to paragraph (e) of that section, which could have been assessed in connection
with the use of an abusive tax avoidance transaction, for each taxable year for which the
taxpayer elects to participate in the voluntary compliance initiative under this subdivision,
to the extent those penalties apply to underreporting of tax liabilities attributable to the use
of abusive tax avoidance transactions for which a participating person files an amended
return in compliance with paragraph (a).
new text end
new text begin
(c) No criminal action must be brought against a taxpayer for the taxable years
reported under the voluntary compliance initiative with respect to the issues for which a
taxpayer voluntarily complies under this chapter.
new text end
new text begin
(d) The taxpayer may file a claim for refund, an administrative appeal, or an action
in district court only after the earlier of the following occurs:
new text end
new text begin
(1) the date the commissioner of revenue takes action on the claim for refund for
the taxable year;
new text end
new text begin
(2) the later of:
new text end
new text begin
(i) 180 days after the date of a final determination by the Internal Revenue Service
with respect to the transaction or transactions to which Minnesota Statutes, chapter 290,
applies; or
new text end
new text begin
(ii) four years after the date the claim for refund was filed, or one year after full
payment of all tax was made, including penalty and interest, whichever is later.
new text end
new text begin
(e)(1) The taxpayer is subject to the substantial understatement penalty under
Minnesota Statutes, section 289A.60, subdivision 4. The penalty may be assessed:
new text end
new text begin
(i) when the commissioner of revenue takes action on the claim for refund; or
new text end
new text begin
(ii) when a federal determination becomes final for the same issue, in which case
the penalty must be assessed, and may not be abated, if the penalty was assessed at the
federal level.
new text end
new text begin
(2) In determining the amount of the underpayment of tax, Code of Federal
Regulations, title 26, section 1.6664-2(c)(2), relating to qualified amended returns, applies.
The underpayment is the difference between the amount of tax on the original return and
the correct amount of tax for the taxable year. The underpayment must not be less than the
amount of the claim for refund filed by the taxpayer under paragraph (d) that was denied.
new text end
new text begin
(3) The penalty is due and payable upon notice and demand by the commissioner
of revenue. Only after the taxpayer has paid all amounts due, including the penalty, and
the claim is denied in whole or in part, may the taxpayer file an appeal under Minnesota
Statutes, section 270.07, in conjunction with the appeal filed under paragraph (d).
new text end
new text begin Subd. 7. new text end
new text begin Commissioner orders and penalties. new text end
new text begin
After December 31, 2005, the
commissioner of revenue may issue an order of assessment within the time period
permitted under Minnesota Statutes, section 289A.38, upon an amended return filed under
this section for an underreported amount of tax, may impose penalties on an underreported
amount of tax on an amended return filed under this chapter, or seek initiation of a criminal
action against any person based on any underreported amount of tax on an amended return
filed under this chapter.
new text end
new text begin Subd. 8. new text end
new text begin Penalty relief; exception. new text end
new text begin
For purposes of this section, if the commissioner
subsequently determines that the correct amount of Minnesota income tax was not paid for
the taxable year for a participant in the voluntary compliance initiative, then the penalty
relief under this section does not apply to any portion of the underpayment attributable to
a tax avoidance transaction not paid to the state.
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. 15. new text begin APPROPRIATION.
new text end
new text begin
For purposes of administering the voluntary compliance initiative and the tax shelter
registration and compliance provisions of this act, $....... is appropriated from the general
fund for fiscal year 2006 and $....... for fiscal year 2007 to the commissioner of revenue.
$....... is added to the base budget.
new text end
ARTICLE 11
MISCELLANEOUS
Section 1.
new text begin
[15.60] PUBLIC SAFETY OFFICERS; AMERICAN FLAG.
new text end
new text begin
(a) A public employer may not forbid a peace officer or firefighter from wearing a
patch or pin depicting the flag of the United States of America on the employee's uniform,
according to customary and standard flag etiquette. However, a public employer may limit
the size of a flag patch worn on a uniform to no more than three inches by five inches.
new text end
new text begin
(b) For purposes of this section:
new text end
new text begin
(1) "peace officer" has the meaning given in section 626.84, subdivision 1, paragraph
(c) or (f);
new text end
new text begin
(2) "firefighter" means a person as defined in section 299A.41, subdivision 4, clause
(3) or (4); and
new text end
new text begin
(3) "public employer" has the meaning given in section 179A.03, subdivision 15,
and also includes a municipal fire department and an independent nonprofit firefighting
corporation.
new text end
new text begin
(c) The commissioner of finance or the commissioner of revenue must suspend
disbursement, not to exceed $10,000, of any state appropriation or aid to any public
employer whom the commissioner determines is not complying with paragraph (a) until
the commissioner determines that the employer is in compliance.
new text end
Sec. 2.
Minnesota Statutes 2004, section 16D.10, is amended to read:
16D.10 CASE REVIEWER.
new text begin Subdivision 1. new text end
new text begin Duties. new text end
The commissioner shall make a case reviewer available to
debtors. The reviewer must be available to answer a debtor's questions concerning the
collection process and to review the collection activity taken. If the reviewer reasonably
believes that the particular action being taken is unreasonable or unfair, the reviewer may
make recommendations to the commissioner in regard to the collection action.
new text begin Subd. 2. new text end
new text begin Authority to issue debtor assistance order. new text end
new text begin
On application filed by a
debtor with the case reviewer, in the form, manner, and in the time prescribed by the
commissioner, and after thorough investigation, the case reviewer may issue a debtor
assistance order if, in the determination of the case reviewer, the manner in which the
state debt collection laws are being administered is creating or will create an unjust and
inequitable result for the debtor. Debtor assistance orders are governed by the provisions
relating to taxpayer assistance orders under section 270.273.
new text end
new text begin Subd. 3. new text end
new text begin Transfer of duties to taxpayer rights advocate. new text end
new text begin
All duties and authority
of the case reviewer under subdivisions 1 and 2 are transferred to the taxpayer rights
advocate.
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.
Minnesota Statutes 2004, section 270.02, subdivision 3, is amended to read:
Subd. 3.
Powers, organization, assistants.
Subject to the provisions of this chapter
and other applicable laws the commissioner shall have power to organize the department
with such divisions and other agencies as the commissioner deems necessary and to
appoint one deputy commissioner, a department secretary, directors of divisions, and
such other officers, employees, and agents as the commissioner may deem necessary to
discharge the functions of the department, define the duties of such officers, employees,
and agents, and delegate to them any of the commissioner's powers or duties, subject to
the commissioner's control and under such conditions as the commissioner may prescribe.
Appointments to exercise delegated power to sign documents which require the signature
of the commissioner or a delegate by law shall be by written order filed with the secretary
of state. new text begin The delegations of authority granted by the commissioner remain in effect until
revoked by the commissioner or a successor commissioner.
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. 4.
Minnesota Statutes 2004, section 270.30, subdivision 1, is amended to read:
Subdivision 1.
Scope.
deleted text begin (a) deleted text end This section applies to a person who deleted text begin offers,deleted text end providesdeleted text begin , or
facilitates the provision of refund anticipation loans, as part of or in connection with
the provision of deleted text end tax preparation services.
deleted text begin
(b) This section does not apply to:
deleted text end
deleted text begin
(1) a tax preparer who provides tax preparation services for fewer than six clients
in a calendar year;
deleted text end
deleted text begin
(2) the provision by a person of tax preparation services to a spouse, parent,
grandparent, child, or sibling; and
deleted text end
deleted text begin
(3) the provision of services by an employee for an employer.
deleted text end
Sec. 5.
Minnesota Statutes 2004, section 270.30, subdivision 5, is amended to read:
Subd. 5.
Itemized bill required.
A tax preparer must provide an itemized statement
of the charges for services, at least separately stating the charges for:
(1) return preparation; new text begin and
new text end
(2) deleted text begin electronic filing; and
deleted text end
deleted text begin (3) deleted text end providing or facilitating a refund anticipation loan.
Sec. 6.
Minnesota Statutes 2004, section 270.30, is amended by adding a subdivision
to read:
new text begin Subd. 5a. new text end
new text begin Nongame wildlife checkoff. new text end
new text begin
A tax preparer must give written notice of
the option to contribute to the nongame wildlife management account in section 290.431
to corporate clients that file an income tax return and to individual clients who file an
income tax return or property tax refund claim form. This notification must:
new text end
new text begin
(1) state substantially the following: "You can help preserve Minnesota's nongame
wildlife, such as bald eagles and loons, by donating to the nongame wildlife fund. If you
wish to donate, enter the amount on the appropriate line provided by your tax preparer
or otherwise notify your tax preparer. This amount will decrease your refund or increase
the amount you owe"; and
new text end
new text begin
(2) be included with information sent to the client at the same time as the preliminary
worksheets or other documents used in preparing the client's return and must include a
line for displaying contributions.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for returns prepared for taxable
years beginning after December 31, 2004.
new text end
Sec. 7.
Minnesota Statutes 2004, section 270.30, subdivision 6, is amended to read:
Subd. 6.
Enforcement; penalties.
The commissioner may impose an administrative
penalty of not more than $1,000 per violation of subdivision 3, 4, or 5. The commissioner
may terminate a tax preparer's authority to transmit returns electronically to the state, if the
commissioner determines the tax preparer engaged in a pattern and practice of violating
this section. Imposition of a penalty under this subdivision is subject to the contested case
procedure under chapter 14. The commissioner shall collect the penalty in the same
manner as the income tax. new text begin Penalties imposed under this subdivision are public data.
new text end
Sec. 8.
Minnesota Statutes 2004, section 270.30, is amended by adding a subdivision
to read:
new text begin Subd. 6a. new text end
new text begin Exchange of data; state board of accountancy. new text end
new text begin
The State Board of
Accountancy shall refer to the commissioner complaints it receives about tax preparers
who are not subject to the jurisdiction of the State Board of Accountancy and who are
alleged to have violated the provisions of subdivisions 3 to 5.
new text end
Sec. 9.
Minnesota Statutes 2004, section 270.30, is amended by adding a subdivision
to read:
new text begin Subd. 6b. new text end
new text begin Exchange of data; lawyers board of professional responsibility. new text end
new text begin
The
Lawyers Board of Professional Responsibility may refer to the commissioner complaints
it receives about tax preparers who are not subject to its jurisdiction and who are alleged
to have violated the provisions of subdivisions 3 to 5.
new text end
Sec. 10.
Minnesota Statutes 2004, section 270.30, is amended by adding a subdivision
to read:
new text begin Subd. 6c. new text end
new text begin Exchange of data; commissioner. new text end
new text begin
The commissioner shall refer
complaints about tax preparers who are alleged to have violated the provisions of
subdivisions 3 to 5 to:
new text end
new text begin
(1) the State Board of Accountancy, if the tax preparer is under its jurisdiction; and
new text end
new text begin
(2) the Lawyers Board of Professional Responsibility, if the tax preparer is under
its jurisdiction.
new text end
Sec. 11.
Minnesota Statutes 2004, section 270.30, is amended by adding a subdivision
to read:
new text begin Subd. 6d. new text end
new text begin Data private. new text end
new text begin
Information exchanged on individuals under subdivisions
6a to 6c are private data under section 13.02, subdivision 12, until such time as a penalty
is imposed as provided in section 326A.08 or by the Lawyers Board of Professional
Responsibility.
new text end
Sec. 12.
Minnesota Statutes 2004, section 270.30, subdivision 8, is amended to read:
Subd. 8.
Exemptions; enforcement provisions.
new text begin (a) new text end The provisions of deleted text begin subdivisions
6 and 7 deleted text end new text begin this section, except for subdivision 4,new text end do not apply to:
(1) an attorney admitted to practice under section 481.01;
(2) a certified public accountant deleted text begin holding a certificate under section 326A.04 or a
person issued a permit to practice under section 326A.05 deleted text end new text begin or other person who is subject to
the jurisdiction of the State Board of Accountancynew text end ;
(3) deleted text begin a person designated as a registered accounting practitioner under Minnesota
Rules, part 1105.6600, or a registered accounting practitioner firm issued a permit under
Minnesota Rules, part 1105.7100;
deleted text end
deleted text begin (4) deleted text end an enrolled agent who has passed the special enrollment examination
administered by the Internal Revenue Service; deleted text begin and
deleted text end
deleted text begin (5) deleted text end new text begin (4) new text end any fiduciary, or the regular employees of a fiduciary, while acting on behalf
of the fiduciary estate, the testator, trustor, grantor, or beneficiaries of themnew text begin ;
new text end
new text begin
(5) a tax preparer who provides tax preparation services for fewer than six clients
in a calendar year;
new text end
new text begin
(6) tax preparation services to a spouse, parent, grandparent, child, or sibling of
the tax preparer; and
new text end
new text begin (7) the preparation by an employee of the tax return of the employee's employernew text end .
Sec. 13.
new text begin
[270.301] PUBLICATION OF NAMES OF TAX PREPARERS SUBJECT
TO PENALTIES.
new text end
new text begin Subdivision 1. new text end
new text begin Publication of list. new text end
new text begin
Notwithstanding any other law, the commissioner
must publish as provided in this section a list or lists of tax preparers subject to penalties.
new text end
new text begin Subd. 2. new text end
new text begin Required and excluded tax preparers. new text end
new text begin
(a) Subject to the limitations
of paragraph (b), the commissioner must publish lists of tax preparers who have been
convicted under section 289A.63.
new text end
new text begin
(b) For the purposes of this section, tax preparers are not subject to publication if:
new text end
new text begin
(1) an administrative or court action contesting the penalty has been filed or served
and is unresolved at the time when notice would be given under subdivision 3;
new text end
new text begin
(2) an appeal period to contest the penalty has not expired; or
new text end
new text begin
(3) the commissioner has been notified that the tax preparer is deceased.
new text end
new text begin Subd. 3. new text end
new text begin Notice to tax preparer. new text end
new text begin
(a) At least 30 days before publishing the name of
a tax preparer subject to penalty, the commissioner shall mail a written notice to the tax
preparer, detailing the amount and nature of each penalty and the intended publication of
the information listed in subdivision 4 related to the penalty. The notice must be mailed
by first class and certified mail addressed to the last known address of the tax preparer.
The notice must include information regarding the exceptions listed in subdivision 2,
paragraph (b), and must state that the tax preparer's information will not be published
if the tax preparer provides information establishing that subdivision 2, paragraph (b),
prohibits publication of the tax preparer's name.
new text end
new text begin
(b) Thirty days after the notice is mailed and if the tax preparer has not proved to the
commissioner that subdivision 2, paragraph (b), prohibits publication, the commissioner
may publish in a list of tax preparers subject to penalty the information about the tax
preparer that is listed in subdivision 4.
new text end
new text begin Subd. 4. new text end
new text begin Form of list. new text end
new text begin
The list may be published by any medium or method. The
list must contain the name, associated business name or names, address or addresses, and
violation or violations for which a penalty was imposed of each tax preparer subject
to penalty.
new text end
new text begin Subd. 5. new text end
new text begin Removal from list. new text end
new text begin
The commissioner shall remove the name of a tax
preparer from the list of tax preparers published under this section:
new text end
new text begin
(1) when the commissioner determines that the name was included on the list in error;
new text end
new text begin
(2) within 90 days after the preparer has fully paid all fines imposed, served any
suspension, and demonstrated to the satisfaction of the commissioner that the preparer
has successfully completed any remedial actions required by the commissioner, the State
Board of Accountancy, or the Lawyers Board of Professional Responsibility; or
new text end
new text begin
(3) when the commissioner has been notified that the tax preparer is deceased.
new text end
new text begin Subd. 6. new text end
new text begin Names published in error. new text end
new text begin
If the commissioner publishes a name under
subdivision 1 in error, the tax preparer whose name was erroneously published has a right
to request a retraction and apology. If the tax preparer so requests, the commissioner
shall publish a retraction and apology acknowledging that the tax preparer's name was
published in error. The retraction and apology must appear in the same medium and the
same format as the original list that contained the name listed in error.
new text end
new text begin Subd. 7. new text end
new text begin Payment of damages. new text end
new text begin
Actions against the commissioner of revenue or
the state of Minnesota arising out of the implementation of this program must be brought
under section 270.276.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
The provision of this section requiring the commissioner to
publish the names of tax preparers applies only to publishing the names of those tax
preparers who commit a crime under section 289A.63 on or after August 1, 2005.
new text end
Sec. 14.
Minnesota Statutes 2004, section 270.65, is amended to read:
270.65 DATE OF ASSESSMENT; DEFINITION.
For purposes of taxes administered by the commissioner, the term "date of
assessment" means the date a liability reported on a return was entered into the records of
the commissioner or the date a return should have been filed, whichever is later; or, in the
case of taxes determined by the commissioner, "date of assessment" means the date of the
order assessing taxes or date of the return made by the commissioner; or, in the case of an
amended return filed by the taxpayer, the assessment date is the date additional liability
reported on the return, if any, was entered into the records of the commissioner; new text begin or, in the
case of a consent agreement signed by the taxpayer under section 270.67, subdivision 3,
the assessment date is the notice date shown on the agreement;new text end or, in the case of a check
from a taxpayer that is dishonored and results in an erroneous refund being given to
the taxpayer, remittance of the check is deemed to be an assessment and the "date of
assessment" is the date the check was received by the commissioner.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 15.
Minnesota Statutes 2004, section 270.67, subdivision 4, is amended to read:
Subd. 4.
Offer-in-compromise and installment payment program.
(a) In
implementing the authority provided in subdivision 2 or in sections 8.30 and 16D.15
to accept offers of installment payments or offers-in-compromise of tax liabilities, the
commissioner of revenue shall prescribe guidelines for employees of the Department of
Revenue to determine whether an offer-in-compromise or an offer to make installment
payments is adequate and should be accepted to resolve a dispute. In prescribing the
guidelines, the commissioner shall develop and publish schedules of national and local
allowances designed to provide that taxpayers entering into a compromise or payment
agreement have an adequate means to provide for basic living expenses. The guidelines
must provide that the taxpayer's ownership interest in a motor vehicle, to the extent of
the value allowed in section 550.37, will not be considered as an asset; in the case of an
offer related to a joint tax liability of spouses, that value of two motor vehicles must be
excluded. The guidelines must provide that employees of the department shall determine,
on the basis of the facts and circumstances of each taxpayer, whether the use of the
schedules is appropriate and that employees must not use the schedules to the extent the
use would result in the taxpayer not having adequate means to provide for basic living
expenses. The guidelines must provide that:
(1) an employee of the department shall not reject an offer-in-compromise or an
offer to make installment payments from a low-income taxpayer solely on the basis of the
amount of the offer; and
(2) in the case of an offer-in-compromise which relates only to issues of liability of
the taxpayer:
(i) the offer must not be rejected solely because the commissioner is unable to locate
the taxpayer's return or return information for verification of the liability; and
(ii) the taxpayer shall not be required to provide an audited, reviewed, or compiled
financial statement.
(b) The commissioner shall establish procedures:
(1) that require presentation of a counteroffer or a written rejection of the offer by
the commissioner if the amount offered by the taxpayer in an offer-in-compromise or an
offer to make installment payments is not accepted by the commissioner;
(2) for an administrative review of any written rejection of a proposed
offer-in-compromise or installment agreement made by a taxpayer under this section
before the rejection is communicated to the taxpayer;
(3) that allow a taxpayer to request reconsideration of any written rejection of the
offer or agreement to the commissioner of revenue to determine whether the rejection is
reasonable and appropriate under the circumstances; and
(4) that provide for notification to the taxpayer when an offer-in-compromise has
been accepted, and issuance of certificates of release of any liens imposed under section
270.69 related to the liability which is the subject of the compromise.
new text begin
(c) Each compromise proposal must be accompanied by a nonrefundable payment
of $250. If the compromise proposal is accepted, the payment must be applied to the
accepted compromise amount. If the compromise is rejected, the payment must be applied
to the outstanding tax debts of the taxpayer pursuant to section 270.652. In cases of
financial hardship, upon presentation of information establishing an inability to make the
$250 payment, the commissioner may waive this requirement.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for offers in compromise submitted
after August 31, 2005.
new text end
Sec. 16.
Minnesota Statutes 2004, section 270.69, subdivision 4, is amended to read:
Subd. 4.
Period of limitations.
The lien imposed by this section shall,
notwithstanding any other provision of law to the contrary, be enforceable from the time
the lien arises and for ten years from the date of filing the notice of lien, which must be
filed by the commissioner within five years after the date of assessment of the tax or final
administrative or judicial determination of the assessment. A notice of lien filed in one
county may be transcribed to new text begin the secretary of state or to new text end any other county within ten years
after the date of its filing, but the transcription shall not extend the period during which
the lien is enforceable. A notice of lien may be renewed by the commissioner before the
expiration of the ten-year period for an additional ten years. The taxpayer must receive
written notice of the renewal.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 17.
Minnesota Statutes 2004, section 270A.03, subdivision 5, is amended to read:
Subd. 5.
Debt.
"Debt" means a legal obligation of a natural person to pay a fixed
and certain amount of money, which equals or exceeds $25 and which is due and payable
to a claimant agency. The term includes criminal fines imposed under section 609.10 or
609.125new text begin , fines imposed for petty misdemeanors as defined in section 609.02, subdivision
4a,new text end and restitution. The term also includes the co-payment for the appointment of a district
public defender imposed under section 611.17, paragraph (c). A debt may arise under a
contractual or statutory obligation, a court order, or other legal obligation, but need not
have been reduced to judgment.
A debt includes any legal obligation of a current recipient of assistance which is
based on overpayment of an assistance grant where that payment is based on a client
waiver or an administrative or judicial finding of an intentional program violation;
or where the debt is owed to a program wherein the debtor is not a client at the time
notification is provided to initiate recovery under this chapter and the debtor is not a
current recipient of food support, transitional child care, or transitional medical assistance.
A debt does not include any legal obligation to pay a claimant agency for medical
care, including hospitalization if the income of the debtor at the time when the medical
care was rendered does not exceed the following amount:
(1) for an unmarried debtor, an income of $8,800 or less;
(2) for a debtor with one dependent, an income of $11,270 or less;
(3) for a debtor with two dependents, an income of $13,330 or less;
(4) for a debtor with three dependents, an income of $15,120 or less;
(5) for a debtor with four dependents, an income of $15,950 or less; and
(6) for a debtor with five or more dependents, an income of $16,630 or less.
The income amounts in this subdivision shall be adjusted for inflation for debts
incurred in calendar years 2001 and thereafter. The dollar amount of each income level
that applied to debts incurred in the prior year shall be increased in the same manner
as provided in section 1(f) of the Internal Revenue Code of 1986, as amended through
December 31, 2000, except that for the purposes of this subdivision the percentage increase
shall be determined from the year starting September 1, 1999, and ending August 31, 2000,
as the base year for adjusting for inflation for debts incurred after December 31, 2000.
Debt also includes an agreement to pay a MinnesotaCare premium, regardless of the
dollar amount of the premium authorized under section 256L.15, subdivision 1a.
Sec. 18.
Minnesota Statutes 2004, section 270A.03, subdivision 7, is amended to read:
Subd. 7.
Refund.
"Refund" means an individual income tax refund deleted text begin or political
contribution refund, pursuant to chapter 290deleted text end , or a property tax credit or refund, pursuant to
chapter 290A, or a sustainable forest tax payment to a claimant under chapter 290C.
For purposes of this chapter, lottery prizes, as set forth in section 349A.08,
subdivision 8, and amounts granted to persons by the legislature on the recommendation
of the joint senate-house of representatives Subcommittee on Claims shall be treated
as refunds.
In the case of a joint property tax refund payable to spouses under chapter 290A,
the refund shall be considered as belonging to each spouse in the proportion of the total
refund that equals each spouse's proportion of the total income determined under section
290A.03, subdivision 3. In the case of a joint income tax refund under chapter 289A, the
refund shall be considered as belonging to each spouse in the proportion of the total
refund that equals each spouse's proportion of the total taxable income determined under
section 290.01, subdivision 29. The commissioner shall remit the entire refund to the
claimant agency, which shall, upon the request of the spouse who does not owe the debt,
determine the amount of the refund belonging to that spouse and refund the amount to
that spouse. For court fines, fees, and surcharges and court-ordered restitution under
section 611A.04, subdivision 2, the notice provided by the commissioner of revenue under
section 270A.07, subdivision 2, paragraph (b), serves as the appropriate legal notice
to the spouse who does not owe the debt.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for political contribution refund
claims based on contributions made on or after July 1, 2005.
new text end
Sec. 19.
Minnesota Statutes 2004, section 289A.08, subdivision 16, is amended to read:
Subd. 16.
Tax refund or return preparers; electronic filing; paper filing fee
imposed.
(a) A "tax refund or return preparer," as defined in section 289A.60, subdivision
13, paragraph deleted text begin (g) deleted text end new text begin (h)new text end , who prepared more than deleted text begin 500 deleted text end new text begin 100 new text end Minnesota individual income tax
returns for the prior calendar year must file all Minnesota individual income tax returns
prepared for the current calendar year by electronic means.
(b) deleted text begin For tax returns prepared for the tax year beginning in 2001, the "500" in
paragraph (a) is reduced to 250.
deleted text end
deleted text begin
(c) For tax returns prepared for tax years beginning after December 31, 2001, the
"500" in paragraph (a) is reduced to 100.
deleted text end
deleted text begin (d) deleted text end Paragraph (a) does not apply to a return if the taxpayer has indicated on the return
that the taxpayer did not want the return filed by electronic means.
deleted text begin (e) deleted text end new text begin (c) new text end For each return that is not filed electronically by a tax refund or return
preparer under this subdivision, including returns filed under paragraph deleted text begin (d) deleted text end new text begin (b)new text end , a paper
filing fee of $5 is imposed upon the preparer. The fee is collected from the preparer in
the same manner as income tax. The fee does not apply to returns that the commissioner
requires to be filed in paper form.
Sec. 20.
Minnesota Statutes 2004, section 289A.37, subdivision 5, is amended to read:
Subd. 5.
Sufficiency of notice.
An order of assessment, sent postage prepaid
by United States mail to the taxpayer at the taxpayer's last known address, new text begin or sent by
electronic mail to the taxpayer's last known electronic mailing address as provided for in
section 325L.08,new text end is sufficient even if the taxpayer is deceased or is under a legal disability,
or, in the case of a corporation, has terminated its existence, unless the department has
been provided with a new address by a party authorized to receive notices of assessment.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 21.
Minnesota Statutes 2004, section 289A.50, subdivision 1, is amended to read:
Subdivision 1.
General right to refund.
(a) Subject to the requirements of this
section and section 289A.40, a taxpayer who has paid a tax in excess of the taxes lawfully
due and who files a written claim for refund will be refunded or credited the overpayment
of the tax determined by the commissioner to be erroneously paid.
(b) The claim must specify the name of the taxpayer, the date when and the period
for which the tax was paid, the kind of tax paid, the amount of the tax that the taxpayer
claims was erroneously paid, the grounds on which a refund is claimed, and other
information relative to the payment and in the form required by the commissioner. An
income tax, estate tax, or corporate franchise tax return, or amended return claiming an
overpayment constitutes a claim for refund.
(c) When, in the course of an examination, and within the time for requesting a
refund, the commissioner determines that there has been an overpayment of tax, the
commissioner shall refund or credit the overpayment to the taxpayer and no demand
is necessary. If the overpayment exceeds $1, the amount of the overpayment must
be refunded to the taxpayer. If the amount of the overpayment is less than $1, the
commissioner is not required to refund. In these situations, the commissioner does not
have to make written findings or serve notice by mail to the taxpayer.
(d) If the amount allowable as a credit for withholding, estimated taxes, or dependent
care exceeds the tax against which the credit is allowable, the amount of the excess is
considered an overpayment. deleted text begin The refund allowed by section 290.06, subdivision 23, is
also considered an overpayment.deleted text end The requirements of section 270.10, subdivision 1, do
not apply to the refunding of such an overpayment shown on the original return filed
by a taxpayer.
(e) If the entertainment tax withheld at the source exceeds by $1 or more the taxes,
penalties, and interest reported in the return of the entertainment entity or imposed by
section 290.9201, the excess must be refunded to the entertainment entity. If the excess is
less than $1, the commissioner need not refund that amount.
(f) If the surety deposit required for a construction contract exceeds the liability of
the out-of-state contractor, the commissioner shall refund the difference to the contractor.
(g) An action of the commissioner in refunding the amount of the overpayment does
not constitute a determination of the correctness of the return of the taxpayer.
(h) There is appropriated from the general fund to the commissioner of revenue the
amount necessary to pay refunds allowed under this section.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for political contribution refund
claims based on contributions made on or after July 1, 2005.
new text end
Sec. 22.
Minnesota Statutes 2004, section 289A.60, subdivision 2a, is amended to read:
Subd. 2a.
Penalties for extended delinquency.
(a) If an individual income tax is
not paid within 180 days after the date of filing of a return or, in the case of taxes assessed
by the commissioner, within 180 days after the assessment date or, if appealed, within 180
days after final resolution of the appeal, an extended delinquency penalty of five percent
of the tax remaining unpaid is added to the amount due.
(b) If a deleted text begin corporate franchise, fiduciary income, mining company, estate, partnership, S
corporation, or nonresident entertainer deleted text end tax return is not filed within 30 days after written
demand for the filing of a delinquent return, an extended delinquency penalty of five
percent of the tax not paid prior to the demand deleted text begin is added to the tax,deleted text end or deleted text begin in the case of an
individual income tax return, a minimum penalty of deleted text end $100 deleted text begin or the five percent penalty
deleted text end is imposed, whichever amount is greater.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for returns originally due on or
after August 1, 2005.
new text end
Sec. 23.
Minnesota Statutes 2004, section 289A.60, subdivision 6, is amended to read:
Subd. 6.
Penalty for new text begin failure to file,new text end false or fraudulent return, evasion.
If a
personnew text begin , with intent to evade or defeat a tax or payment of tax, fails to file a return,new text end files
a false or fraudulent return, or attempts in any new text begin other new text end manner to evade or defeat a tax or
payment of tax, there is imposed on the person a penalty equal to 50 percent of the tax,
less amounts paid by the person on the basis of the false or fraudulent return, new text begin if any,new text end due
for the period to which the return related.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 24.
Minnesota Statutes 2004, section 289A.60, subdivision 11, is amended to read:
Subd. 11.
Penalties relating to information reports, withholding.
(a) When a
person required under section 289A.09, subdivision 2, to give a statement to an employee
or payee and a duplicate statement to the commissioner, or to give a reconciliation of the
statements and quarterly returns to the commissioner, gives a false or fraudulent statement
to an employee or payee or a false or fraudulent duplicate statement or reconciliation of
statements and quarterly returns to the commissioner, or fails to give a statement or the
reconciliation in the manner, when due, and showing the information required by section
289A.09, subdivision 2, or rules prescribed by the commissioner under that section, that
person is liable for a penalty of $50 for an act or failure to act. The total amount imposed
on the delinquent person for failures during a calendar year must not exceed $25,000.
(b) In addition to any other penalty provided by law, an employee who gives
a withholding exemption certificate or a residency affidavit to an employer that deleted text begin the
employee has reason to know contains a materially incorrect statement deleted text end new text begin decreases the
amount withheld under section 290.92 and as of the time the certificate or affidavit was
given to the employer there was no reasonable basis for the statements in the certificate or
affidavit new text end is liable to the commissioner of revenue for a penalty of $500 for each instance.
(c) In addition to any other penalty provided by law, an employer who fails to
submit a copy of a withholding exemption certificate or a residency affidavit required by
section 290.92, subdivision 5a, clause (1)(a), (1)(b), or (2) is liable to the commissioner of
revenue for a penalty of $50 for each instance.
(d) An employer or payor who fails to file an application for a withholding account
number, as required by section 290.92, subdivision 24, is liable to the commissioner for
a penalty of $100.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for certificates and affidavits given to
employers after December 31, 2005.
new text end
Sec. 25.
Minnesota Statutes 2004, section 289A.60, subdivision 13, is amended to read:
Subd. 13.
Penalties for tax return preparers.
(a) If an understatement of liability
with respect to a return or claim for refund is due to a willful attempt in any manner to
understate the liability for a tax by a person who is a tax return preparer with respect to the
return or claim, the person shall pay to the commissioner a penalty of $500. If a part of a
property tax refund claim is excessive due to a willful attempt in any manner to overstate
the claim for relief allowed under chapter 290A by a person who is a tax refund or return
preparer, the person shall pay to the commissioner a penalty of $500 with respect to the
claim. These penalties may not be assessed against the employer of a tax return preparer
unless the employer was actively involved in the willful attempt to understate the liability
for a tax or to overstate the claim for refund. These penalties are income tax liabilities and
may be assessed at any time as provided in section 289A.38, subdivision 5.
(b) A civil action in the name of the state of Minnesota may be commenced to
enjoin any person who is a tax return preparer doing business in this state from further
engaging in any conduct described in paragraph (c). An action under this paragraph
must be brought by the attorney general in the district court for the judicial district of the
tax return preparer's residence or principal place of business, or in which the taxpayer
with respect to whose tax return the action is brought resides. The court may exercise its
jurisdiction over the action separate and apart from any other action brought by the state
of Minnesota against the tax return preparer or any taxpayer.
(c) In an action under paragraph (b), if the court finds that a tax return preparer has:
(1) engaged in any conduct subject to a civil penalty under section 289A.60 or a
criminal penalty under section 289A.63;
(2) misrepresented the preparer's eligibility to practice before the Department of
Revenue, or otherwise misrepresented the preparer's experience or education as a tax
return preparer;
(3) guaranteed the payment of any tax refund or the allowance of any tax credit; or
(4) engaged in any other fraudulent or deceptive conduct that substantially interferes
with the proper administration of state tax law, and injunctive relief is appropriate to
prevent the recurrence of that conduct,
the court may enjoin the person from further engaging in that conduct.
(d) If the court finds that a tax return preparer has continually or repeatedly engaged
in conduct described in paragraph (c), and that an injunction prohibiting that conduct
would not be sufficient to prevent the person's interference with the proper administration
of state tax laws, the court may enjoin the person from acting as a tax return preparer.
The court may not enjoin the employer of a tax return preparer for conduct described in
paragraph (c) engaged in by one or more of the employer's employees unless the employer
was also actively involved in that conduct.
(e) new text begin The commissioner may terminate or suspend a tax preparer's authority to
transmit returns electronically to the state, if the commissioner determines that the tax
preparer has engaged in a pattern and practice of conduct in violation of paragraph (a) of
this subdivision or has been convicted under section 289A.63.
new text end
new text begin (f) new text end For purposes of this subdivision, the term "understatement of liability" means
an understatement of the net amount payable with respect to a tax imposed by state tax
law, or an overstatement of the net amount creditable or refundable with respect to a
tax. The determination of whether or not there is an understatement of liability must be
made without regard to any administrative or judicial action involving the taxpayer. For
purposes of this subdivision, the amount determined for underpayment of estimated tax
under either section 289A.25 or 289A.26 is not considered an understatement of liability.
deleted text begin (f) deleted text end new text begin (g) new text end For purposes of this subdivision, the term "overstatement of claim" means an
overstatement of the net amount refundable with respect to a claim for property tax relief
provided by chapter 290A. The determination of whether or not there is an overstatement
of a claim must be made without regard to administrative or judicial action involving
the claimant.
deleted text begin (g) deleted text end new text begin (h) new text end For purposes of this section, the term "tax refund or return preparer" means
an individual who prepares for compensation, or who employs one or more individuals to
prepare for compensation, a return of tax, or a claim for refund of tax. The preparation of
a substantial part of a return or claim for refund is treated as if it were the preparation of
the entire return or claim for refund. An individual is not considered a tax return preparer
merely because the individual:
(1) gives typing, reproducing, or other mechanical assistance;
(2) prepares a return or claim for refund of the employer, or an officer or employee
of the employer, by whom the individual is regularly and continuously employed;
(3) prepares a return or claim for refund of any person as a fiduciary for that person;
or
(4) prepares a claim for refund for a taxpayer in response to a tax order issued
to the taxpayer.
Sec. 26.
Minnesota Statutes 2004, section 290.01, subdivision 6, is amended to read:
Subd. 6.
Taxpayer.
The term "taxpayer" means any person or corporation subject to
a tax imposed by this chapter. deleted text begin For purposes of section 290.06, subdivision 23, the term
"taxpayer" means an individual eligible to vote in Minnesota under section 201.014.
deleted text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for political contribution refund
claims based on contributions that are made on or after July 1, 2005.
new text end
Sec. 27.
Minnesota Statutes 2004, section 290.92, subdivision 1, is amended to read:
Subdivision 1.
Definitions.
(1) [WAGES.] For purposes of this section, the term
"wages" means the same as that term is defined in section 3401(a) and (f) of the Internal
Revenue Code.
(2) [PAYROLL PERIOD.] For purposes of this section the term "payroll period"
means a period for which a payment of wages is ordinarily made to the employee by
the employee's employer, and the term "miscellaneous payroll period" means a payroll
period other than a daily, weekly, biweekly, semimonthly, monthly, quarterly, semiannual,
or annual payroll period.
(3) [EMPLOYEE.] For purposes of this section the term "employee" means any
resident individual performing services for an employer, either within or without, or both
within and without the state of Minnesota, and every nonresident individual performing
services within the state of Minnesota, the performance of which services constitute,
establish, and determine the relationship between the parties as that of employer and
employee. As used in the preceding sentence, the term "employee" includes an officer
of a corporation, and an officer, employee, or elected official of the United States, a
state, or any political subdivision thereof, or the District of Columbia, or any agency or
instrumentality of any one or more of the foregoing.
(4) [EMPLOYER.] For purposes of this section the term "employer" means any
person, including individuals, fiduciaries, estates, trusts, partnerships, limited liability
companies, and corporations transacting business in or deriving any income from sources
within the state of Minnesota for whom an individual performs or performed any service,
of whatever nature, as the employee of such person, except that if the person for whom the
individual performs or performed the services does not havedeleted text begin legal deleted text end control of the payment
of the wages for such services, the term "employer," except for purposes of paragraph (1),
means the person having deleted text begin legal deleted text end control of the payment of such wages. As used in the
preceding sentence, the term "employer" includes any corporation, individual, estate, trust,
or organization which is exempt from taxation under section 290.05 and further includes,
but is not limited to, officers of corporations who have deleted text begin legal deleted text end control, either individually or
jointly with another or others, of the payment of the wages.
(5) [NUMBER OF WITHHOLDING EXEMPTIONS CLAIMED.] For purposes of
this section, the term "number of withholding exemptions claimed" means the number of
withholding exemptions claimed in a withholding exemption certificate in effect under
subdivision 5, except that if no such certificate is in effect, the number of withholding
exemptions claimed shall be considered to be zero.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following final enactment.
new text end
Sec. 28.
Minnesota Statutes 2004, section 325D.33, subdivision 6, is amended to read:
Subd. 6.
Violations.
If the commissioner determines that a distributor is violating
any provision of this chapter, the commissioner must give the distributor a written
warning explaining the violation and an explanation of what must be done to comply with
this chapter. Within ten days of issuance of the warning, the distributor must notify the
commissioner that the distributor has complied with the commissioner's recommendation
or request that the commissioner set the issue for a hearing pursuant to chapter 14. If a
hearing is requested, the hearing shall be scheduled within 20 days of the request and the
recommendation of the administrative law judge shall be issued within five working days
of the close of the hearing. The commissioner's final determination shall be issued within
five working days of the receipt of the administrative law judge's recommendation. If the
commissioner's final determination is adverse to the distributor and the distributor does
not comply within ten days of receipt of the commissioner's final determination, the
commissioner may order the distributor to immediately cease the stamping of cigarettes.
As soon as practicable after the order, the commissioner must remove the meter and any
unapplied cigarette stamps from the premises of the distributor.
If within ten days of issuance of the written warning the distributor has not complied
with the commissioner's recommendation or requested a hearing, the commissioner may
order the distributor to immediately cease the stamping of cigarettes and remove the meter
and unapplied stamps from the distributor's premises.
deleted text begin
If, within any 12-month period, the commissioner has issued three written warnings
to any distributor, even if the distributor has complied within ten days, the commissioner
shall notify the distributor of the commissioner's intent to revoke the distributor's
license for a continuing course of conduct contrary to this chapter. For purposes of this
paragraph, a written warning that was ultimately resolved by removal of the warning by
the commissioner is not deemed to be a warning. The commissioner must notify the
distributor of the date and time of a hearing pursuant to chapter 14 at least 20 days before
the hearing is held. The hearing must provide an opportunity for the distributor to show
cause why the license should not be revoked. If the commissioner revokes a distributor's
license, the commissioner shall not issue a new license to that distributor for 180 days.
deleted 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. 29.
new text begin
[459.21] GAMBLING SUBSIDIES; REFERENDUM APPROVAL.
new text end
new text begin
No city or county may provide an exemption from a tax or fee, an abatement of a
tax, or fee or any other type of public subsidy to an enterprise engaged in gambling,
unless the question of whether to provide the exemption, abatement, or subsidy has been
submitted to the voters at a special or general election and a majority of the votes cast on
the question are in the affirmative.
new text end
new text begin
For purposes of this section, the following terms have the meanings given:
new text end
new text begin
(1) "Gambling" means conducting class III gaming as defined in United States
Code, title 25, section 2703.
new text end
new text begin
(2) "Public subsidy" does not include (i) construction of public infrastructure unless
the predominant use of the infrastructure is to serve an enterprise engaged in gambling
or (ii) the use, maintenance, or reconstruction (without expansion) of preexisting
infrastructure.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective the day following enactment.
new text end
Sec. 30.
Minnesota Statutes 2004, section 645.44, is amended by adding a subdivision
to read:
new text begin Subd. 19. new text end
new text begin Fee and tax. new text end
new text begin
(a) "Tax" means any fee, charge, exaction, or assessment
imposed by a governmental entity on an individual, person, entity, transaction, good,
service, or other thing. It excludes a price that an individual or entity chooses voluntarily
to pay in return for receipt of goods or services provided by the governmental entity.
A government good or service does not include access to or the authority to engage in
private market transactions with a nongovernmental party, such as licenses to engage in a
trade, profession, or business or to improve private property.
new text end
new text begin
(b) For purposes of applying the laws of this state, a "fee," "charge," or other similar
term that satisfies the functional requirements of paragraph (a) must be treated as a tax for
all purposes, regardless of whether the statute or law names or describes it as a tax. The
provisions of this subdivision do not preempt or supersede limitations under statute or law
that apply to fees, charges, or assessments.
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. 31. new text begin TAX REFORM COMMISSION.
new text end
new text begin Subdivision 1. new text end
new text begin Commission established. new text end
new text begin
A tax reform action commission is
established in the legislative branch to study the Minnesota tax and revenue system and to
make recommendations to the legislature.
new text end
new text begin Subd. 2. new text end
new text begin Membership. new text end
new text begin
(a) The commission consists of 15 members, appointed
as follows:
new text end
new text begin
(1) three members appointed by the governor, two from the executive branch and
one from private life;
new text end
new text begin
(2) four members appointed by the majority leader of the senate, two members of the
senate and two from private life;
new text end
new text begin
(3) two members appointed by the minority leader of the senate, one member of the
senate and one from private life;
new text end
new text begin
(4) four members appointed by the speaker of the house of representatives, two
members of the house of representatives and two from private life; and
new text end
new text begin
(5) two members appointed by the minority leader of the house of representatives,
one member of the house of representatives and one from private life.
new text end
new text begin
(b) The appointing authority shall select members who are of recognized standing
and distinction and who possess demonstrated capacity to discharge the duties of the
commission. In making appointments, the appointing authorities shall attempt to appoint
some individuals to the commission who have special experience or knowledge in
taxation, economics, and accounting.
new text end
new text begin
(c) The governor shall designate a member of the commission as its chair who shall
determine its duties and supervise its staff.
new text end
new text begin
(d) The appointing authorities shall appoint members of the commission not more
than 30 days after enactment of this section. Members serve for the life of the commission.
A vacancy in the commission membership does not affect the power of the remaining
members to execute the duties of the commission. A vacancy in commission membership
is filled in the same manner in which the original appointment was made.
new text end
new text begin Subd. 3. new text end
new text begin Duties; report. new text end
new text begin
(a) The commission shall study and evaluate the Minnesota
state and local tax and revenue system with a goal of making long-term improvements in
the system for the citizens of the state, given standard principles of good tax policy and
the background of expected demographic and economic changes in the state, nation, and
world. The commission's recommendations must be done on a revenue neutral basis. In
particular, the commission shall examine:
new text end
new text begin
(1) the mix of state revenues between tax revenues and fees and charges for services
used or benefits received;
new text end
new text begin
(2) the implications of likely demographic and economic changes, affecting both (i)
the demands for state and local government services and (ii) taxes and other revenues; and
new text end
new text begin
(3) the extent to which the existing tax system and the commission's proposal satisfy
the following basic tax policy principles:
new text end
new text begin
(i) equity or fairness, including measures based on ability to pay, equal treatment of
equals, and payment for benefits received;
new text end
new text begin
(ii) neutrality or efficiency, the extent to which the effects on private market
decisions are minimized;
new text end
new text begin
(iii) revenue adequacy, the extent to which the revenues are stable and predictable
and grow with increases in income or economic activity;
new text end
new text begin
(iv) competitiveness, the extent to which negative effects on the state's attractiveness
as a location for investment, working, and living are minimized;
new text end
new text begin
(v) simplicity, the extent to which it is easy to understand;
new text end
new text begin
(vi) ease of compliance and administration, the extent to which taxpayers can easily
comply and the government can easily administer it; and
new text end
new text begin
(vii) visibility or accountability, the extent to which the taxes or other charges are
clear and apparent to their payers as a cost of government and that the government
officials imposing the tax are accountable, through election or otherwise, to the principal
payers of the tax.
new text end
new text begin
(b) The commission shall report to the legislature as provided in this paragraph. Each
report must include the commission's evaluation of the tax or taxes, its recommendations
for reform and improvement of the tax or taxes on a revenue neutral basis, its rationale for
the proposed changes, and a draft bill implementing the commission's recommendation
for introduction in the legislature. The reports must be submitted by the following dates:
new text end
new text begin
(1) corporate and other business taxation, including the credit for increasing research
activities, by July 1, 2007;
new text end
new text begin
(2) general sales and motor vehicle sales and special excise taxes by July 1, 2008;
new text end
new text begin
(3) individual income taxation by July 1, 2009; and
new text end
new text begin
(4) estate, insurance premium, MinnesotaCare, and all other taxes not covered by
clauses (1) to (3) by July 1, 2010.
new text end
new text begin Subd. 4. new text end
new text begin Per diem and expenses. new text end
new text begin
Members of the commission may be compensated
and receive reimbursement for expenses, as provided for members of advisory councils
under Minnesota Statutes, section 15.059, subdivision 3. This subdivision does not apply
to members of the legislature or state employees.
new text end
new text begin Subd 5.new text end [STAFF.] new text begin The commission may employ staff as it deems appropriate to
carry out its duties or use existing legislative and executive branch staff. All staff are in
the unclassified state service. Legislative staff and the Department of Revenue staff must
provide research, bill drafting, and other services to the commission upon its request. The
commission may contract with consultants for research and other services and enter other
contracts, as it deems necessary or appropriate to carry out its duties. These contracts are
not subject to the requirements of Minnesota Statutes, chapter 16C.
new text end
new text begin Subd. 6. new text end
new text begin Expiration. new text end
new text begin
The commission terminates 30 days after transmitting its final
report to the legislature under subdivision 3, paragraph (b).
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. 32. new text begin TRANSFER.
new text end
new text begin
On July 1, 2005, the commissioner of finance shall transfer $3,408,000 and any
additional amount from the tax relief account under Minnesota Statutes, section 16A.1522,
subdivision 4, to the general fund.
new text end
Sec. 33. new text begin APPROPRIATION.
new text end
new text begin
(a) $125,000 in fiscal year 2006 and $125,000 in fiscal year 2007 are appropriated
from the general fund to the commissioner of revenue to make grants to one or more
nonprofit organizations, qualifying under section 501(c)(3) of the Internal Revenue Code
of 1986, to coordinate, facilitate, encourage, and aid in the provision of taxpayer assistance
services. This is a onetime appropriation and is not added to the base.
new text end
new text begin
(b) "Taxpayer assistance services" mean accounting and tax preparation services
provided by volunteers to low-income and disadvantaged Minnesota residents to help
them file federal and state income tax returns and Minnesota property tax refund claims
and to provide personal representation before the Department of Revenue and Internal
Revenue Service.
new text end
Sec. 34. new text begin REPEALER.
new text end
new text begin
(a) Minnesota Statutes 2004, section 10A.322, subdivision 4, is repealed effective
July 1, 2005.
new text end
new text begin
(b) Minnesota Statutes 2004, section 16A.1522, subdivision 4, is repealed effective
July 2, 2005.
new text end
new text begin
(c) Minnesota Statutes 2004, section 290.06, subdivision 23, is repealed effective for
contributions made after June 30, 2005.
new text end