SF 748

1st Engrossment - 83rd Legislature (2003 - 2004) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to finance; changing local government aids; 
  1.3             providing for levy limits; making sales tax 
  1.4             accelerated June liability provisions permanent; 
  1.5             providing for deposit of certain sales and cigarette 
  1.6             tax proceeds; providing for cash flow and budget 
  1.7             reserve accounts; abolishing a contingent transfer 
  1.8             from the budget reserve account; abolishing or 
  1.9             providing for the expiration of certain funds and 
  1.10            accounts; authorizing delay of certain payments to 
  1.11            cities and counties; repealing a refund on used motor 
  1.12            oil and filters; appropriating money; amending 
  1.13            Minnesota Statutes 2002, sections 16A.152, 
  1.14            subdivisions 1, 1b, 2, 7; 62J.694, subdivision 4; 
  1.15            144.395, subdivision 3; 273.1398, subdivisions 4a, 4c, 
  1.16            6, 8; 275.025, subdivision 1; 275.065, by adding a 
  1.17            subdivision; 275.07, subdivision 1; 275.70, 
  1.18            subdivisions 3, 5; 275.71, subdivisions 2, 4, 5, 6; 
  1.19            275.73, subdivision 2; 275.74, subdivisions 2, 3; 
  1.20            289A.20, subdivision 4; 297A.94; 297F.10, subdivision 
  1.21            1; 477A.013, subdivision 9; 477A.03, subdivision 2; 
  1.22            Laws 2001, First Special Session chapter 5, article 
  1.23            12, section 95, as amended; Laws 2002, chapter 377, 
  1.24            article 12, section 17; proposing coding for new law 
  1.25            in Minnesota Statutes, chapter 477A; repealing 
  1.26            Minnesota Statutes 2002, sections 273.138; 273.1398, 
  1.27            subdivision 2; 273.166; 275.71, subdivision 5; 
  1.28            325E.112, subdivision 2a; 477A.011, subdivisions 36, 
  1.29            37; 477A.0121, subdivisions 1, 2, 3, 4, 5, 6; 
  1.30            477A.0122, subdivisions 1, 2, 3, 4, 5, 6; 477A.0123; 
  1.31            477A.03, subdivisions 3, 4; 477A.06; 477A.065; 477A.07.
  1.32  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.33                             ARTICLE 1
  1.34              2003/2004 CITY AND COUNTY AID REDUCTIONS 
  1.35     Section 1.  [DEFINITIONS.] 
  1.36     (a) For purposes of this article, the following terms have 
  1.37  the meanings given them in this section. 
  1.38     (b) The 2003 "levy plus aid revenue base" for a city is the 
  2.1   sum of that city's proposed property tax levy for taxes payable 
  2.2   in 2003, as reported to the commissioner of revenue under 
  2.3   Minnesota Statutes, section 275.74, plus the sum of the amounts 
  2.4   the city was certified to receive in 2003 as: 
  2.5      (1) local government aid under Minnesota Statutes, section 
  2.6   477A.013; 
  2.7      (2) existing low-income housing aid under Minnesota 
  2.8   Statutes, section 477A.06; 
  2.9      (3) new construction low-income housing aid under Minnesota 
  2.10  Statutes, section 477A.065; 
  2.11     (4) taconite aids under Minnesota Statutes, sections 298.28 
  2.12  and 298.282, including any aid which was required to be placed 
  2.13  in a special fund for expenditure in the next succeeding year; 
  2.14  and 
  2.15     (5) transit property tax replacement aid under Minnesota 
  2.16  Statutes, section 174.242. 
  2.17     (c) The 2003 and 2004 "levy plus aid revenue base" for a 
  2.18  county is the sum of that county's proposed property tax levy 
  2.19  for taxes payable in 2003, as reported to the commissioner of 
  2.20  revenue under Minnesota Statutes, section 275.74, plus the sum 
  2.21  of the amounts the county was certified to receive in the 
  2.22  designated calendar year as: 
  2.23     (1) homestead and agricultural credit aid under Minnesota 
  2.24  Statutes, sections 273.1398, subdivision 2, and 273.166; 
  2.25     (2) criminal justice aid under Minnesota Statutes, section 
  2.26  477A.0121; 
  2.27     (3) family preservation aid under Minnesota Statutes, 
  2.28  section 477A.0122; 
  2.29     (4) taconite aids under Minnesota Statutes, sections 298.28 
  2.30  and 298.282, including any aid which was required to be placed 
  2.31  in a special fund for expenditure in the next succeeding year; 
  2.32     (5) transit property tax replacement aid under Minnesota 
  2.33  Statutes, section 174.242; and 
  2.34     (6) county program aid under section 477A.0124. 
  2.35     (d) "Total revenues" for a city or county for a particular 
  2.36  year are the total revenues amount for that city or county, as 
  3.1   reported by the state auditor for the same year, or for the most 
  3.2   recent preceding year for which the state auditor has reported, 
  3.3   excluding grants between political subdivisions and amounts 
  3.4   borrowed by the city or county but including net transfers from 
  3.5   an enterprise fund. 
  3.6      [EFFECTIVE DATE.] This section is effective the day 
  3.7   following final enactment. 
  3.8      Sec. 2.  [2003 CITY AID REDUCTIONS.] 
  3.9      The commissioner of revenue shall compute an aid reduction 
  3.10  amount for each city for 2003 equal to 9.3 percent of the city's 
  3.11  levy plus aid revenue base for 2003. 
  3.12     The reduction amount is limited to 3.5 percent of the 
  3.13  city's total revenues for 2003 if a city has a population under 
  3.14  1,000 or if the city has a three-year levy plus aid revenue base 
  3.15  increase average of less than two percent.  For all other 
  3.16  cities, the reduction amount is limited to five percent of the 
  3.17  city's total revenues for 2003. 
  3.18     The reduction is further limited to the sum of the city's 
  3.19  payable 2003 distribution pursuant to Minnesota Statutes, 
  3.20  section 477A.013, and related sections, and the city's payable 
  3.21  2003 reimbursement under Minnesota Statutes, section 273.1384. 
  3.22     The reduction is applied first to the city's distribution 
  3.23  pursuant to Minnesota Statutes, section 477A.013, and then if 
  3.24  necessary to the city's reimbursements pursuant to Minnesota 
  3.25  Statutes, section 273.1384. 
  3.26     To the extent that sufficient information is available on 
  3.27  each successive payment date within the year, the commissioner 
  3.28  of revenue shall pay any remaining 2003 distribution or 
  3.29  reimbursement amount reduced under this section in equal 
  3.30  installments on the payment dates provided in law. 
  3.31     [EFFECTIVE DATE.] This section is effective the day 
  3.32  following final enactment. 
  3.33     Sec. 3.  [2003 COUNTY AID REDUCTIONS.] 
  3.34     The commissioner of revenue shall compute an aid reduction 
  3.35  amount for each county for 2003 equal to 3.2 percent of the 
  3.36  county's levy plus aid revenue base for 2003. 
  4.1      The reduction amount is limited to 1.5 percent of the 
  4.2   county's total revenues for 2003 if a county has a three-year 
  4.3   levy plus aid revenue base increase average of less than two 
  4.4   percent.  For all other counties, the reduction amount is 
  4.5   limited to two percent of the county's total revenues for 2003. 
  4.6      The reduction is further limited to the sum of the county's 
  4.7   payable 2003 distributions pursuant to Minnesota Statutes, 
  4.8   sections 273.138; 273.1384; 273.1398, subdivision 2; 273.166; 
  4.9   477A.0121; and 477A.0122. 
  4.10     The aid reduction is applied first to reduce the county's 
  4.11  2003 distribution pursuant to Minnesota Statutes, section 
  4.12  273.138, then to reduce, in this sequence, the aid payable in 
  4.13  2003 under Minnesota Statutes, sections 273.1398, subdivision 2; 
  4.14  273.166; 477A.0121; and 477A.0122.  Then, if necessary, the 
  4.15  county's reimbursements pursuant to Minnesota Statutes, section 
  4.16  273.1384, are to be reduced. 
  4.17     To the extent that sufficient information is available on 
  4.18  each successive payment date within the year, the commissioner 
  4.19  of revenue shall pay any remaining 2003 distribution or 
  4.20  reimbursement amount reduced under this section in equal 
  4.21  installments on the payment dates provided in law. 
  4.22     [EFFECTIVE DATE.] This section is effective the day 
  4.23  following final enactment. 
  4.24     Sec. 4.  [TOWNSHIP AID REDUCTIONS.] 
  4.25     The commissioner or revenue shall compute an aid reduction 
  4.26  amount for each township for 2003 equal to two percent of the 
  4.27  town's certified levy for taxes payable in 2003. 
  4.28     The reduction is limited to the amount of the town's 
  4.29  payable 2003 reimbursement pursuant to Minnesota Statutes, 
  4.30  section 273.1384.  
  4.31     To the extent that sufficient information is available on 
  4.32  each successive payment date within the year, the commissioner 
  4.33  of revenue shall pay any remaining 2003 reimbursement amount for 
  4.34  the town in equal installments on the payment dates provided in 
  4.35  law. 
  4.36     [EFFECTIVE DATE.] This section is effective the day 
  5.1   following final enactment. 
  5.2      Sec. 5.  [2003 SPECIAL TAXING DISTRICT AID REDUCTIONS.] 
  5.3      The commissioner of revenue shall compute an aid reduction 
  5.4   amount for each special taxing district for 2003 equal to 1.5 
  5.5   percent of the district's certified levy for taxes payable in 
  5.6   2003. 
  5.7      The reduction is limited to the amount of the district's 
  5.8   payable 2003 reimbursement pursuant to Minnesota Statutes, 
  5.9   section 237.1384. 
  5.10     To the extent that sufficient information is available on 
  5.11  each successive payment date within the year, the commissioner 
  5.12  of revenue shall pay any remaining 2003 reimbursement amount for 
  5.13  the district in equal installments on the payment dates provided 
  5.14  in law. 
  5.15     [EFFECTIVE DATE.] This section is effective the day 
  5.16  following final enactment. 
  5.17     Sec. 6.  [2004 CITY AID REDUCTIONS.] 
  5.18     The commissioner of revenue shall compute an aid reduction 
  5.19  amount for 2004 for each city as provided in this section. 
  5.20     The initial aid reduction amount for each city is the 
  5.21  amount by which the city's aid distribution under Minnesota 
  5.22  Statutes, section 477A.013, and related provisions payable in 
  5.23  2003 exceeds the city's 2004 distribution under those provisions.
  5.24     The maximum aid reduction amount for a city is an amount 
  5.25  equal to 9.5 percent of the city's total revenues for 2004, 
  5.26  except that if the city has either a population under 1,000 or a 
  5.27  three-year levy plus aid revenue base increase average of less 
  5.28  than two percent, the maximum aid reduction shall not exceed an 
  5.29  amount equal to eight percent of the city's total revenues for 
  5.30  2004. 
  5.31     If the initial aid reduction amount for a city is less than 
  5.32  the maximum aid reduction amount for that city, the final aid 
  5.33  reduction amount for the city is the sum of the initial aid 
  5.34  reduction amount and the lesser of the amount of the city's 
  5.35  payable 2004 reimbursement under Minnesota Statutes, section 
  5.36  273.1384, or the difference between the maximum and initial aid 
  6.1   reduction amounts for the city. 
  6.2      If the initial aid reduction amount for a city is greater 
  6.3   than the maximum aid reduction amount for the city, the city 
  6.4   receives an additional distribution under this section equal to 
  6.5   the result of subtracting the maximum aid reduction amount from 
  6.6   the initial aid reduction amount.  This distribution shall be 
  6.7   paid in equal installments in 2004 on the dates specified in 
  6.8   Minnesota Statutes, section 477A.015.  The amount necessary for 
  6.9   these additional distributions is appropriated to the 
  6.10  commissioner of revenue from the general fund in fiscal year 
  6.11  2005. 
  6.12     The reduction is applied first to the city's distribution 
  6.13  pursuant to Minnesota Statutes, section 477A.013, and then, if 
  6.14  necessary, to the city's reimbursements pursuant to Minnesota 
  6.15  Statutes, section 273.1384. 
  6.16     To the extent that sufficient information is available on 
  6.17  each payment date in 2004, the commissioner of revenue shall pay 
  6.18  the reimbursements reduced under this section in equal 
  6.19  installments on the payment dates provided in law. 
  6.20     [EFFECTIVE DATE.] This section is effective the day 
  6.21  following final enactment. 
  6.22     Sec. 7.  [2004 COUNTY AID REDUCTIONS.] 
  6.23     The commissioner of revenue shall compute an aid reduction 
  6.24  amount for 2004 for each county as provided in this section. 
  6.25     The commissioner of revenue shall compute an aid reduction 
  6.26  amount for each county for 2004 equal to six percent of the 
  6.27  county's levy plus aid revenue base for 2004. 
  6.28     The reduction amount is limited to 2.5 percent of the 
  6.29  county's total revenues for 2004 if a county has a three-year 
  6.30  levy plus aid revenue base increase average of less than two 
  6.31  percent.  For all other counties, the reduction amount is 
  6.32  limited to three percent of the county's total revenues for 2004.
  6.33     The reduction is further limited to the sum of the county's 
  6.34  payable 2004 distributions under Minnesota Statutes, sections 
  6.35  477A.0124 and 273.1384. 
  6.36     The aid reduction is applied first to the county's 
  7.1   distributions pursuant to Minnesota Statutes, section 477A.0124, 
  7.2   and then, if necessary, to reduce the county's reimbursements 
  7.3   pursuant to Minnesota Statutes, section 273.1384. 
  7.4      To the extent that sufficient information is available on 
  7.5   each payment date in 2004, the commissioner of revenue shall pay 
  7.6   any remaining 2004 distribution or reimbursement amount reduced 
  7.7   under this section in equal installments on the payment dates 
  7.8   provided in law. 
  7.9      [EFFECTIVE DATE.] This section is effective the day 
  7.10  following final enactment. 
  7.11     Sec. 8.  [2004 TOWNSHIP AID REDUCTIONS.] 
  7.12     The commissioner of revenue shall compute an aid reduction 
  7.13  amount for each township for 2004 equal to three percent of the 
  7.14  town's certified levy for taxes payable in 2003.  
  7.15     The reduction is limited to the amount of the town's 
  7.16  payable 2004 reimbursement pursuant to Minnesota Statutes, 
  7.17  section 273.1384. 
  7.18     To the extent that sufficient information is available on 
  7.19  each successive payment date within the year, the commissioner 
  7.20  of revenue shall pay any remaining 2004 reimbursement amount for 
  7.21  the town in equal installments on the payment dates provided in 
  7.22  law. 
  7.23     [EFFECTIVE DATE.] This section is effective the day 
  7.24  following final enactment. 
  7.25     Sec. 9.  [2004 SPECIAL TAXING DISTRICT AID REDUCTIONS.] 
  7.26     The commissioner of revenue shall compute an aid reduction 
  7.27  amount for each special taxing district for 2004 equal to two 
  7.28  percent of the district's certified levy for taxes payable in 
  7.29  2003.  
  7.30     The reduction is limited to the amount of the district's 
  7.31  payable 2004 reimbursement pursuant to Minnesota Statutes, 
  7.32  section 273.1384. 
  7.33     To the extent that sufficient information is available on 
  7.34  each successive payment date within the year, the commissioner 
  7.35  of revenue shall pay any remaining 2004 reimbursement amount for 
  7.36  the district in equal installments on the payment dates provided 
  8.1   in law. 
  8.2      [EFFECTIVE DATE.] This section is effective the day 
  8.3   following final enactment. 
  8.4                              ARTICLE 2
  8.5                            2004 CITY AID 
  8.6      Section 1.  Minnesota Statutes 2002, section 477A.013, 
  8.7   subdivision 9, is amended to read: 
  8.8      Subd. 9.  [CITY AID DISTRIBUTION.] (a) In calendar year 
  8.9   2002 and thereafter 2004, each city shall receive an aid 
  8.10  distribution equal to the sum of (1) the city formula aid under 
  8.11  subdivision 8, and (2) its city aid base. 
  8.12     (b) The percentage increase change for a first class city 
  8.13  in a calendar year 1995 and thereafter, except for 2002, shall 
  8.14  not exceed the percentage increase change in the sum of the aid 
  8.15  to all cities under this section in the current calendar year 
  8.16  compared to the sum of the aid to all cities in the previous 
  8.17  year.  For aids payable in 2002 only, the amount of the aid paid 
  8.18  to a first class city shall not exceed the sum of its aid amount 
  8.19  for calendar year 2001 under this section and its aid payment in 
  8.20  calendar year 2001 under section 273.1398, subdivision 2, by 
  8.21  more than 2.5 percent. 
  8.22     (c) For aids payable in all years except 2002, The total 
  8.23  aid in a calendar year for any city, except a first class city, 
  8.24  shall not exceed the sum of (1) ten percent of the city's net 
  8.25  levy for the year prior to the aid distribution plus (2) its 
  8.26  total aid in the previous year.  For aids payable in 2002 only, 
  8.27  the total aid for any city, except a first class city, shall not 
  8.28  exceed the sum of (1) 40 percent of the city's net levy for 
  8.29  taxes payable in the year prior to the aid distribution plus (2) 
  8.30  40 percent of its total aid in the previous year under section 
  8.31  273.1398, subdivision 2, plus (3) its total aid in the previous 
  8.32  year under this section. 
  8.33     [EFFECTIVE DATE.] This section is effective for aid payable 
  8.34  in 2004 and thereafter. 
  8.35     Sec. 2.  Minnesota Statutes 2002, section 477A.03, 
  8.36  subdivision 2, is amended to read: 
  9.1      Subd. 2.  [ANNUAL APPROPRIATION.] (a) A sum sufficient to 
  9.2   discharge the duties imposed by sections 477A.011 to 477A.014 is 
  9.3   annually appropriated from the general fund to the commissioner 
  9.4   of revenue.  
  9.5      (b) Aid payments to counties under section 477A.0121 are 
  9.6   limited to $20,265,000 in 1996.  Aid payments to counties under 
  9.7   section 477A.0121 are limited to $27,571,625 in 1997.  For aid 
  9.8   payable in 1998 and thereafter, the total aids paid under 
  9.9   section 477A.0121 are the amounts certified to be paid in the 
  9.10  previous year, adjusted for inflation as provided under 
  9.11  subdivision 3. 
  9.12     (c)(i) For aids payable in 1998 and thereafter, the total 
  9.13  aids paid to counties under section 477A.0122 are the amounts 
  9.14  certified to be paid in the previous year, adjusted for 
  9.15  inflation as provided under subdivision 3. 
  9.16     (ii) Aid payments to counties under section 477A.0122 in 
  9.17  2000 are further increased by an additional $20,000,000 in 2000. 
  9.18     (d) Aid payments to cities in 2002 under section 477A.013, 
  9.19  subdivision 9, are limited to the amounts certified to be paid 
  9.20  in the previous year, adjusted for inflation as provided in 
  9.21  subdivision 3, and increased by $140,000,000.  For aids payable 
  9.22  in 2003, the total aids paid under section 477A.013, subdivision 
  9.23  9, are the amounts certified to be paid in the previous year, 
  9.24  adjusted for inflation as provided under subdivision 3.  For 
  9.25  aids payable in 2004, the total aids paid under section 
  9.26  477A.013, subdivision 9, are the amounts certified to be paid in 
  9.27  the previous year, adjusted for inflation as provided under 
  9.28  subdivision 3, and increased by the amount certified to be paid 
  9.29  in 2003 under section 477A.06.  For aids payable in 2005 and 
  9.30  thereafter, the total aids paid under section 477A.013, 
  9.31  subdivision 9, are the amounts certified to be paid in the 
  9.32  previous year, adjusted for inflation as provided under 
  9.33  subdivision 3.  The additional amount authorized under 
  9.34  subdivision 4 is not included when calculating the appropriation 
  9.35  limits under this paragraph limited to $250,000,000.  For aids 
  9.36  payable in 2005 and thereafter, the total aids paid under 
 10.1   section 477A.013, subdivision 9, are increased to $352,000,000 
 10.2   if a new aid distribution formula is enacted by the legislature 
 10.3   in 2003 containing principles accepted by the governor. 
 10.4      (e) Reimbursements made to counties under section 477A.0123 
 10.5   in calendar year 2005 and thereafter are limited to an amount 
 10.6   equal to the maximum allowed appropriation under this section in 
 10.7   the previous year, multiplied by a percent to be established by 
 10.8   law.  If no percent is established by law, the appropriation is 
 10.9   limited to the total amount appropriated for this purpose in the 
 10.10  previous year. 
 10.11     [EFFECTIVE DATE.] This section is effective for aid payable 
 10.12  in 2004 and thereafter. 
 10.13                             ARTICLE 3
 10.14                          2004 COUNTY AID 
 10.15     Section 1.  Minnesota Statutes 2002, section 273.1398, 
 10.16  subdivision 4a, is amended to read: 
 10.17     Subd. 4a.  [AID OFFSET FOR COURT COSTS.] (a) In calendar 
 10.18  years 2004, 2005, and 2006, the commissioner of revenue shall 
 10.19  pay the amounts determined in this subdivision to the eligible 
 10.20  counties on the dates specified in subdivision 6.  By July 15 of 
 10.21  the year preceding the year in which the state assumes the cost 
 10.22  of court administration in the judicial district as specified 
 10.23  under section 480.183, 2003, the supreme court shall determine 
 10.24  and certify to the commissioner of revenue for each county the 
 10.25  county's share of the costs to be assumed in the judicial 
 10.26  districts specified under section 480.183, subdivision 1, during 
 10.27  each of the succeeding fiscal year years. 
 10.28     (b) The amount certified in paragraph (a) shall be equal to 
 10.29  the following: 
 10.30     (1) 103 percent of the required court administration 
 10.31  expenditures as defined under section 480.183, subdivision 3, 
 10.32  for calendar year 2003, as determined under subdivision 4b, 
 10.33  paragraph (a); plus 
 10.34     (2) an adjustment for any cumulative percentage increase in 
 10.35  salary expenditures as defined under section 480.183, 
 10.36  subdivision 2, in excess of a maintenance of effort increase of 
 11.1   six percent; less 
 11.2      (3) an amount equal to the county's share of transferred 
 11.3   fines collected by the district courts in the county during the 
 11.4   calendar year preceding certification.  
 11.5      The court and the county may, if both parties agree, 
 11.6   negotiate and certify an amount higher than the amount 
 11.7   calculated under this paragraph. 
 11.8      (c) For purposes of this subdivision, the adjustment in 
 11.9   paragraph (b), clause (2), shall be equal to: 
 11.10     (1) the sum of the court administration expenditures as 
 11.11  defined under section 480.183, subdivision 3, required under 
 11.12  subdivision 4b, paragraph (a), plus the temporary aid payment 
 11.13  under subdivision 4c; multiplied by 
 11.14     (2) the difference between (i) the cumulative percentage 
 11.15  increase in actual and anticipated salary settlements for court 
 11.16  employees from July 1, 2001, until the date of the court 
 11.17  transfer and (ii) the percentage specified in subdivision 4b, 
 11.18  paragraph (a).  
 11.19     (d) Payments to a county under this subdivision 2 or 
 11.20  section 273.166 for the calendar year in which the state assumes 
 11.21  the cost of court administration as defined under section 
 11.22  480.183, subdivision 3, in the judicial district must be 
 11.23  permanently reduced by an amount equal to 75 percent of the net 
 11.24  cost to the state for assumption of district court costs as 
 11.25  certified in paragraph (a). 
 11.26     (e) Payments to a county under this subdivision 2 or 
 11.27  section 273.166 for the calendar year after the calendar year in 
 11.28  which the state assumes the cost of court administration as 
 11.29  defined under section 480.183, subdivision 3, in the judicial 
 11.30  district must be permanently reduced by an amount equal to 25 
 11.31  percent of the net cost to the state for assumption of district 
 11.32  court costs as certified in paragraph (a)., provided that this 
 11.33  amount must be increased or decreased by an amount equal to the 
 11.34  positive or negative difference between the amount of fee and 
 11.35  fine revenue certified under paragraph (b), clause (3), and the 
 11.36  actual amount of fee and fine revenue of the county for the 
 12.1   calendar year when certification takes place. 
 12.2      (f) Payments to a county under subdivision 2 for calendar 
 12.3   year 2001 are permanently increased by an amount equal to 7.5 
 12.4   percent of the county's share of transferred fines collected by 
 12.5   the district courts in the county during calendar year 1998, as 
 12.6   determined under paragraph (a).  If the amount determined in 
 12.7   paragraph (a) exceeds the amount of aid a county is scheduled to 
 12.8   be paid under subdivision 2 in 2000, then the county shall not 
 12.9   receive an aid increase under this paragraph. 
 12.10     (g) Payments to a county under subdivision 2 or section 
 12.11  273.166, for the cost of mandated services, as defined in 
 12.12  section 480.183, subdivision 4, in the judicial district, must 
 12.13  be permanently reduced in 2002 by an amount equal to the cost to 
 12.14  the state for assumption of mandated court services as defined 
 12.15  in section 480.183, subdivision 4.  The supreme court shall 
 12.16  determine the amount for each county and certify it to the 
 12.17  commissioner of revenue by July 15, 2001. 
 12.18     [EFFECTIVE DATE.] This section is effective for aid payable 
 12.19  in 2004, 2005, and 2006. 
 12.20     Sec. 2.  Minnesota Statutes 2002, section 273.1398, 
 12.21  subdivision 4c, is amended to read: 
 12.22     Subd. 4c.  [TEMPORARY AID; COURT ADMINISTRATION COSTS.] For 
 12.23  calendar years 2004 and 2005, each county in a judicial district 
 12.24  that has not been transferred to the state by January 1 of that 
 12.25  year shall receive additional homestead and agricultural 
 12.26  credit temporary court administration cost aid.  This amount is 
 12.27  in addition to the amount calculated under subdivision 2 and 
 12.28  must not be included in the definition of homestead and 
 12.29  agricultural credit base under subdivision 1, paragraph (j).  
 12.30  The amount of additional aid is equal to the difference between 
 12.31  (1) the amount budgeted for court administration costs in 2001 
 12.32  as determined under subdivision 4b, paragraph (b), multiplied by 
 12.33  the maintenance of effort percent for the calendar year as 
 12.34  determined under subdivision 4b, paragraph (a), and (2) the 
 12.35  amount calculated under subdivision 4b, paragraph (a), for 
 12.36  calendar year 2003.  This additional aid must be used only to 
 13.1   fund court administration expenditures as defined in section 
 13.2   480.183, subdivision 3.  This amount must be added to the state 
 13.3   court's base budget in the year when the court in that judicial 
 13.4   district in which the county is located is transferred to the 
 13.5   state. 
 13.6      [EFFECTIVE DATE.] This section is effective for aid payable 
 13.7   in 2004 and 2005. 
 13.8      Sec. 3.  Minnesota Statutes 2002, section 273.1398, 
 13.9   subdivision 6, is amended to read: 
 13.10     Subd. 6.  [PAYMENT.] The commissioner shall certify the 
 13.11  aids provided in subdivisions 2, 2b, 3, and 5 before September 1 
 13.12  of the year preceding the distribution year to the county 
 13.13  auditor of the affected local government.  The aids provided in 
 13.14  subdivisions 2, 2b, 3, 4a, 4c, and 5 must be paid to local 
 13.15  governments other than school districts at the times provided in 
 13.16  section 477A.015 for payment of local government aid to taxing 
 13.17  jurisdictions, except that the first one-half payment of 
 13.18  disparity reduction aid provided in subdivision 3 must be paid 
 13.19  on or before August 31.  The disparity reduction credit provided 
 13.20  in subdivision 4 must be paid to taxing jurisdictions other than 
 13.21  school districts at the time provided in section 473H.10, 
 13.22  subdivision 3.  Aids and credit reimbursements to school 
 13.23  districts must be certified to the commissioner of children, 
 13.24  families, and learning and paid under section 273.1392.  In 
 13.25  2004, the aid provided in subdivision 2 shall constitute a 
 13.26  portion of program aid for counties and shall be paid as 
 13.27  provided in section 477A.0124.  Payment shall not be made to any 
 13.28  taxing jurisdiction that has ceased to levy a property tax.  
 13.29     [EFFECTIVE DATE.] This section is effective for aid payable 
 13.30  in 2004 and thereafter. 
 13.31     Sec. 4.  Minnesota Statutes 2002, section 273.1398, 
 13.32  subdivision 8, is amended to read: 
 13.33     Subd. 8.  [APPROPRIATION.] (a) An amount sufficient to pay 
 13.34  the aids and credits provided under this section for school 
 13.35  districts, intermediate school districts, or any group of school 
 13.36  districts levying as a single taxing entity, is annually 
 14.1   appropriated from the general fund to the commissioner of 
 14.2   children, families, and learning.  An amount sufficient to pay 
 14.3   the aids and credits provided under this section for counties, 
 14.4   cities, towns, and special taxing districts is annually 
 14.5   appropriated from the general fund to the commissioner of 
 14.6   revenue.  A jurisdiction's aid amount may be increased or 
 14.7   decreased based on any prior year adjustments for homestead 
 14.8   credit or other property tax credit or aid programs.  The total 
 14.9   appropriation for the aid provided in subdivision 4a is limited 
 14.10  to $15,700,000 for fiscal year 2005 and $3,300,000 for fiscal 
 14.11  year 2006.  The total appropriation for the aid provided in 
 14.12  subdivision 4c is limited to $2,800,000 for fiscal year 2005 and 
 14.13  $3,200,000 for fiscal year 2006. 
 14.14     (b) The commissioner of finance shall bill the commissioner 
 14.15  of revenue for the cost of preparation of local impact notes as 
 14.16  required by section 3.987 only to the extent to which those 
 14.17  costs exceed those costs incurred in fiscal year 1997 and for 
 14.18  any other new costs attributable to the local impact note 
 14.19  function required by section 3.987, not to exceed $100,000 in 
 14.20  fiscal years 1998 and 1999 and $200,000 in fiscal year 2000 and 
 14.21  thereafter. 
 14.22     The commissioner of revenue shall deduct the amount billed 
 14.23  under this paragraph from aid payments to be made to cities and 
 14.24  counties under subdivision 2 on a pro rata basis.  The amount 
 14.25  deducted under this paragraph is appropriated to the 
 14.26  commissioner of finance for the preparation of local impact 
 14.27  notes. 
 14.28     [EFFECTIVE DATE.] This section is effective for aid payable 
 14.29  in 2004 and thereafter. 
 14.30     Sec. 5.  [477A.0124] [COUNTY PROGRAM AID.] 
 14.31     Subdivision 1.  [CALENDAR YEAR 2004.] In 2004, each county 
 14.32  shall receive program aid in an amount equal to the sum of: 
 14.33     (1) the amount of county attached machinery aid computed 
 14.34  for the county for payment in 2003 under section 273.138 prior 
 14.35  to any reduction under laws enacted in 2003; 
 14.36     (2) the amount of county homestead and agricultural credit 
 15.1   aid computed for the county for payment in 2003 under section 
 15.2   273.1398, subdivision 2, prior to any reduction under laws 
 15.3   enacted in 2003, plus a fiscal disparity adjustment under 
 15.4   section 273.1398, subdivision 1, for aid payable in 2004, minus 
 15.5   the aid to be paid to the county in 2004 under section 273.1398, 
 15.6   subdivisions 4a and 4c; 
 15.7      (3) the amount of county manufactured home homestead and 
 15.8   agricultural credit aid computed for the county for payment in 
 15.9   2003 under section 273.166 prior to any reduction under laws 
 15.10  enacted in 2003; 
 15.11     (4) the amount of county criminal justice aid computed for 
 15.12  the county for payment in 2003 under section 477A.0121 prior to 
 15.13  any reduction under laws enacted in 2003; and 
 15.14     (5) the amount of county family preservation aid computed 
 15.15  for the county for payment in 2003 under section 477A.0122 prior 
 15.16  to any reduction under laws enacted in 2003. 
 15.17     Subd. 2.  [CALENDAR YEAR 2005 AND THEREAFTER.] In 2005 and 
 15.18  thereafter, each county shall receive county program aid in an 
 15.19  amount equal to the county's portion of the total county program 
 15.20  aid certified for payment in the prior year times the amount 
 15.21  appropriated for distribution in the year of the payment. 
 15.22     Subd. 3.  [PAYMENT.] The amount of county program aid 
 15.23  payable to a county in a calendar year shall be paid by the 
 15.24  commissioner of revenue in equal installments on the dates 
 15.25  specified in section 477A.015. 
 15.26     Subd. 4.  [APPROPRIATIONS.] (a) In fiscal year 2006, 
 15.27  $100,000,000 is appropriated to the commissioner of revenue to 
 15.28  make the aid payments provided in this section.  An additional 
 15.29  $105,000,000 is appropriated in fiscal year 2006 for this 
 15.30  purpose if a new aid formula is enacted by the legislature in 
 15.31  2003 containing principles accepted by the governor. 
 15.32     (b) Each calendar year, $500,000 of the total appropriation 
 15.33  for this section shall be retained by the commissioner of 
 15.34  revenue to make reimbursements to the commissioner of finance 
 15.35  for payments made under section 611.27.  The reimbursements 
 15.36  shall be to defray the additional costs associated with 
 16.1   court-ordered counsel under section 611.27.  Any retained 
 16.2   amounts not used for reimbursement in a year shall be included 
 16.3   in the next distribution of county program aid that is certified 
 16.4   to the county auditors for the purpose of property tax reduction 
 16.5   for the next taxes payable year. 
 16.6      [EFFECTIVE DATE.] This section is effective the day 
 16.7   following final enactment. 
 16.8                              ARTICLE 4
 16.9                             LEVY LIMITS 
 16.10     Section 1.  Minnesota Statutes 2002, section 275.065, is 
 16.11  amended by adding a subdivision to read: 
 16.12     Subd. 9.  [REVERSE REFERENDUM.] The reverse referendum 
 16.13  procedure in this subdivision applies only in the case of a 
 16.14  county, or a city that has a population of more than 2,500, that 
 16.15  has adopted a property tax levy increase over the levy amount 
 16.16  certified under section 275.07, subdivision 1, for the previous 
 16.17  year. 
 16.18     If, within 21 days after the public hearing and adoption of 
 16.19  a levy under subdivision 6, a petition signed by voters equal in 
 16.20  number to five percent of the votes cast in the county or city 
 16.21  in the last general election requesting a referendum on the levy 
 16.22  increase is filed with the county auditor or the city clerk, the 
 16.23  levy increase shall not be effective until it has been submitted 
 16.24  to the voters at a special election to be held on the fourth 
 16.25  Tuesday in January, and a majority of votes cast on the question 
 16.26  of approving the levy increase are in the affirmative.  The 
 16.27  commissioner of revenue shall prepare the form of the question 
 16.28  to be presented at the referendum, which shall reference only 
 16.29  the amount of the property tax levy increase over the previous 
 16.30  year. 
 16.31     The county or city shall notify the county auditor of the 
 16.32  results of the referendum.  If the majority of the votes cast on 
 16.33  the question are in the affirmative, the levy adopted under 
 16.34  subdivision 6 shall be certified to the county auditor under 
 16.35  section 275.07, subdivision 1.  If the majority of the votes 
 16.36  cast on the question are in the negative, an amount equal to the 
 17.1   preceding year's levy shall be certified to the county auditor 
 17.2   for purposes of section 275.07, subdivision 1; provided that if 
 17.3   the current year adopted levy includes any levy for the payment 
 17.4   of bonded indebtedness or judgments, such levies for bonded 
 17.5   indebtedness and judgments shall be extended in full and the 
 17.6   remainder of the levies shall be reduced so that the total, 
 17.7   including levies for bonds and judgments, does not exceed the 
 17.8   preceding year's levy. 
 17.9      [EFFECTIVE DATE.] This section is effective for taxes 
 17.10  levied in 2004 and thereafter, for taxes payable in 2005 and 
 17.11  thereafter. 
 17.12     Sec. 2.  Minnesota Statutes 2002, section 275.07, 
 17.13  subdivision 1, is amended to read: 
 17.14     Subdivision 1.  [CERTIFICATION OF LEVY.] (a) Except as 
 17.15  provided under paragraph (b) or (c), the taxes voted by cities, 
 17.16  counties, school districts, and special districts shall be 
 17.17  certified by the proper authorities to the county auditor on or 
 17.18  before five working days after December 20 in each year.  A town 
 17.19  must certify the levy adopted by the town board to the county 
 17.20  auditor by September 15 each year.  If the town board modifies 
 17.21  the levy at a special town meeting after September 15, the town 
 17.22  board must recertify its levy to the county auditor on or before 
 17.23  five working days after December 20.  The taxes certified shall 
 17.24  not be reduced by the county auditor by the aid received under 
 17.25  section 273.1398, subdivision 2, but shall be reduced by the 
 17.26  county auditor by the aid received under section 273.1398, 
 17.27  subdivision 3.  If a city, town, county, school district, or 
 17.28  special district fails to certify its levy by that date, its 
 17.29  levy shall be the amount levied by it for the preceding year. 
 17.30     (b)(i) The taxes voted by counties under sections 103B.241, 
 17.31  103B.245, and 103B.251 shall be separately certified by the 
 17.32  county to the county auditor on or before five working days 
 17.33  after December 20 in each year.  The taxes certified shall not 
 17.34  be reduced by the county auditor by the aid received under 
 17.35  section 273.1398, subdivisions 2 and 3.  If a county fails to 
 17.36  certify its levy by that date, its levy shall be the amount 
 18.1   levied by it for the preceding year.  
 18.2      (ii) For purposes of the proposed property tax notice under 
 18.3   section 275.065 and the property tax statement under section 
 18.4   276.04, for the first year in which the county implements the 
 18.5   provisions of this paragraph, the county auditor shall reduce 
 18.6   the county's levy for the preceding year to reflect any amount 
 18.7   levied for water management purposes under clause (i) included 
 18.8   in the county's levy. 
 18.9      (c) A county or city to which the reverse referendum 
 18.10  provisions under section 275.065, subdivision 9, apply, shall 
 18.11  certify the taxes to the county auditor by January 5, except 
 18.12  that any county or city for which a petition has been filed 
 18.13  under section 275.065, subdivision 9, must certify the day 
 18.14  immediately following the election under that subdivision. 
 18.15     [EFFECTIVE DATE.] This section is effective for taxes 
 18.16  levied in 2004 and thereafter, for taxes payable in 2005 and 
 18.17  thereafter. 
 18.18     Sec. 3.  Minnesota Statutes 2002, section 275.70, 
 18.19  subdivision 3, is amended to read: 
 18.20     Subd. 3.  [LOCAL GOVERNMENTAL UNIT.] "Local governmental 
 18.21  unit" means a county, or a statutory or home rule charter 
 18.22  city with a population greater than 2,500. 
 18.23     [EFFECTIVE DATE.] This section is effective for taxes 
 18.24  payable in 2004 and thereafter. 
 18.25     Sec. 4.  Minnesota Statutes 2002, section 275.70, 
 18.26  subdivision 5, is amended to read: 
 18.27     Subd. 5.  [SPECIAL LEVIES.] "Special levies" means those 
 18.28  portions of ad valorem taxes levied by a local governmental unit 
 18.29  for the following purposes or in the following manner: 
 18.30     (1) to pay the costs of the principal and interest 
 18.31  on existing bonded indebtedness or; for this purpose, "existing 
 18.32  bonded indebtedness" means: 
 18.33     (i) the amount of bonded indebtedness for which a special 
 18.34  levy under this clause was claimed for taxes levied in 2002 in 
 18.35  the case of a county or city that was subject to section 275.71 
 18.36  for taxes levied in 2002; 
 19.1      (ii) the amount of bonded indebtedness for which the same 
 19.2   special levy could have been claimed for taxes levied in 2002 if 
 19.3   the local governmental unit was not subject to section 275.71 
 19.4   for taxes levied in 2002; 
 19.5      (iii) the amount of bonded indebtedness if the city or 
 19.6   county has, prior to May 1, 2003, entered into a binding 
 19.7   contract or agreement requiring the expenditure of some or all 
 19.8   of the borrowed funds; and 
 19.9      (iv) the amount of bonded indebtedness the issuance of 
 19.10  which was approved by the voters of the city or county prior to 
 19.11  May 1, 2003; 
 19.12     (2) to reimburse for the amount of liquor store revenues 
 19.13  used to pay the principal and interest due on municipal liquor 
 19.14  store bonds in the year preceding the year for which the levy 
 19.15  limit is calculated; 
 19.16     (2) (3) to pay the costs of principal and interest on 
 19.17  certificates of indebtedness issued for any corporate purpose 
 19.18  except for the following: 
 19.19     (i) tax anticipation or aid anticipation certificates of 
 19.20  indebtedness; 
 19.21     (ii) certificates of indebtedness issued under sections 
 19.22  298.28 and 298.282; 
 19.23     (iii) certificates of indebtedness used to fund current 
 19.24  expenses or to pay the costs of extraordinary expenditures that 
 19.25  result from a public emergency; or 
 19.26     (iv) certificates of indebtedness used to fund an 
 19.27  insufficiency in tax receipts or an insufficiency in other 
 19.28  revenue sources; 
 19.29     (3) (4) to provide for the bonded indebtedness portion of 
 19.30  payments made to another political subdivision of the state of 
 19.31  Minnesota if the amount would have qualified as a special levy 
 19.32  for taxes levied in 2002 or the bonds were issued before May 1, 
 19.33  2003; 
 19.34     (4) (5) to fund payments made to the Minnesota state armory 
 19.35  building commission under section 193.145, subdivision 2, to 
 19.36  retire the principal and interest on armory construction bonds; 
 20.1      (5) (6) property taxes approved by voters which are levied 
 20.2   against the referendum market value as provided under section 
 20.3   275.61; 
 20.4      (6) (7) to fund matching requirements needed to qualify for 
 20.5   federal or state grants or programs to the extent that either 
 20.6   (i) the matching requirement exceeds the matching requirement in 
 20.7   calendar year 2001, or (ii) it is a new matching requirement 
 20.8   that did not exist prior to 2002; 
 20.9      (7) (8) to pay the expenses reasonably and necessarily 
 20.10  incurred in preparing for or repairing the effects of natural 
 20.11  disaster including the occurrence or threat of widespread or 
 20.12  severe damage, injury, or loss of life or property resulting 
 20.13  from natural causes, in accordance with standards formulated by 
 20.14  the emergency services division of the state department of 
 20.15  public safety, as allowed by the commissioner of revenue under 
 20.16  section 275.74, subdivision 2; 
 20.17     (8) (9) pay amounts required to correct an error in the 
 20.18  levy certified to the county auditor by a city or county in a 
 20.19  levy year, but only to the extent that when added to the 
 20.20  preceding year's levy it is not in excess of an applicable 
 20.21  statutory, special law or charter limitation, or the limitation 
 20.22  imposed on the governmental subdivision by sections 275.70 to 
 20.23  275.74 in the preceding levy year; 
 20.24     (9) (10) to pay an abatement under section 469.1815 for 
 20.25  which the granting resolution was adopted prior to May 1, 2003; 
 20.26     (10) (11) to pay any costs attributable to increases in the 
 20.27  employer contribution rates under chapter 353 that are effective 
 20.28  after June 30, 2001; 
 20.29     (11) (12) to pay the operating or maintenance costs of a 
 20.30  county jail as authorized in section 641.01 or 641.262, or of a 
 20.31  correctional facility as defined in section 241.021, subdivision 
 20.32  1, paragraph (5), to the extent that the county can demonstrate 
 20.33  to the commissioner of revenue that the amount has been included 
 20.34  in the county budget as a direct result of a rule, minimum 
 20.35  requirement, minimum standard, or directive of the department of 
 20.36  corrections, or to pay the operating or maintenance costs of a 
 21.1   regional jail as authorized in section 641.262.  For purposes of 
 21.2   this clause, a district court order is not a rule, minimum 
 21.3   requirement, minimum standard, or directive of the department of 
 21.4   corrections.  If the county utilizes this special levy, any 
 21.5   amount levied by the county in the previous levy year for the 
 21.6   purposes specified under this clause and included in the 
 21.7   county's previous year's levy limitation computed under section 
 21.8   275.71, shall be deducted from the levy limit base under section 
 21.9   275.71, subdivision 2, when determining the county's current 
 21.10  year levy limitation.  The county shall provide the necessary 
 21.11  information to the commissioner of revenue for making this 
 21.12  determination.  The amount of this special levy is limited to 
 21.13  110 percent of the amount levied by the county for these 
 21.14  purposes in the prior year; 
 21.15     (12) (13) to pay for operation of a lake improvement 
 21.16  district, as authorized under section 103B.555.  If the county 
 21.17  utilizes this special levy, any amount levied by the county in 
 21.18  the previous levy year for the purposes specified under this 
 21.19  clause and included in the county's previous year's levy 
 21.20  limitation computed under section 275.71 shall be deducted from 
 21.21  the levy limit base under section 275.71, subdivision 2, when 
 21.22  determining the county's current year levy limitation.  The 
 21.23  county shall provide the necessary information to the 
 21.24  commissioner of revenue for making this determination.  The 
 21.25  amount of this special levy is limited to 110 percent of the 
 21.26  amount levied by the county for these purposes in the prior 
 21.27  year; 
 21.28     (13) (14) to repay a state or federal loan used to fund the 
 21.29  direct or indirect required spending by the local government due 
 21.30  to a state or federal transportation project or other state or 
 21.31  federal capital project.  This authority may only be used if the 
 21.32  project is not a local government initiative; 
 21.33     (14) for counties only, to pay the costs reasonably 
 21.34  expected to be incurred in 2002 related to the redistricting of 
 21.35  election districts and establishment of election precincts under 
 21.36  sections 204B.135 and 204B.14, the notice required by section 
 22.1   204B.14, subdivision 4, and the reassignment of voters in the 
 22.2   statewide registration system, not to exceed $1 per capita, 
 22.3   provided that the county shall distribute a portion of the 
 22.4   amount levied under this clause equal to 25 cents times the 
 22.5   population of the city to all cities in the county with a 
 22.6   population of 30,000 or more; 
 22.7      (15) to pay for court administration costs as required 
 22.8   under section 273.1398, subdivision 4b, less the county's share 
 22.9   of transferred fines and fees collected by the district courts 
 22.10  in the county for calendar year 2001 aid amount certified to be 
 22.11  paid to the county in 2004 under section 273.1398, subdivisions 
 22.12  4a and 4c; however, for taxes levied to pay for these costs in 
 22.13  the year in which the court financing is transferred to the 
 22.14  state, the amount under this section clause is limited to 
 22.15  one-third of the aid reduction under section 273.1398, 
 22.16  subdivision 4a; and 
 22.17     (16) to fund a police or firefighters relief association as 
 22.18  required under section 69.77 to the extent that the required 
 22.19  amount exceeds the amount levied for this purpose in 2001. 
 22.20     [EFFECTIVE DATE.] This section is effective for taxes 
 22.21  payable in 2004 and thereafter. 
 22.22     Sec. 5.  Minnesota Statutes 2002, section 275.71, 
 22.23  subdivision 2, is amended to read: 
 22.24     Subd. 2.  [LEVY LIMIT BASE.] (a) The levy limit base for a 
 22.25  local governmental unit for taxes levied in 2001 2003 is equal 
 22.26  to the greater of: 
 22.27     (1) the sum of its adjusted levy limit base for taxes 
 22.28  levied in 1999 plus the amount it levied in 1999 under Minnesota 
 22.29  Statutes 1999 Supplement, section 275.70, subdivision 5, clauses 
 22.30  (8) and (13), multiplied by: 
 22.31     (i) one plus the percentage growth in the implicit price 
 22.32  deflator for the 12-month period ending March 30, 2000; 
 22.33     (ii) one plus a percentage equal to the annual percentage 
 22.34  increase in the estimated number of households, if any, for the 
 22.35  most recent 12-month period that was available on July 1, 2000; 
 22.36  and 
 23.1      (iii) one plus a percentage equal to 50 percent of the 
 23.2   percentage increase in the taxable market value of the 
 23.3   jurisdiction due to new construction of class 3 property, as 
 23.4   defined in section 273.13, subdivision 24, except for 
 23.5   state-assessed utility and railroad operating property, for the 
 23.6   most recent year for which data was available as of July 1, 2000 
 23.7   ; or 
 23.8      (2) an amount equal to: 
 23.9      (i) (1) the sum of the amount it levied in 2000 2002 plus 
 23.10  the amount of aids it was certified to receive in calendar 
 23.11  year 2001 2003 under sections 273.1398, 273.166, 298.282, 
 23.12  477A.011 to 477A.03, prior to any aid reductions under section 
 23.13  273.1399, subdivision 5, 477A.06, and 477A.065, and 477A.07, 
 23.14  prior to any aid reductions enacted into law in 2003; less 
 23.15     (ii) (2) the amount it levied in 2000 2002 that would 
 23.16  qualify have qualified as special levies under Minnesota 
 23.17  Statutes 2002, section 275.70, subdivision 6, for taxes levied 
 23.18  in 2001 2002.  The local governmental unit shall provide the 
 23.19  commissioner of revenue with sufficient information to make this 
 23.20  calculation. 
 23.21     (b) If the governmental unit was not subject to levy limits 
 23.22  for taxes levied in 1999, its levy limit base for taxes levied 
 23.23  in 2001 is equal to the amount calculated under paragraph (a), 
 23.24  clause (2). 
 23.25     (c) The levy limit base for a local governmental unit for 
 23.26  taxes levied in 2002 is equal to its adjusted levy limit base in 
 23.27  the previous year, plus the amount of tree growth tax it 
 23.28  received in calendar year 2001 under sections 270.31 to 270.39, 
 23.29  and plus, in the case of a city, the amount it was certified to 
 23.30  receive in calendar year 2001 under section 273.166, is subject 
 23.31  to any adjustments under section 275.72. 
 23.32     [EFFECTIVE DATE.] This section is effective for taxes 
 23.33  payable in 2004 and thereafter. 
 23.34     Sec. 6.  Minnesota Statutes 2002, section 275.71, 
 23.35  subdivision 4, is amended to read: 
 23.36     Subd. 4.  [ADJUSTED LEVY LIMIT BASE.] (a) For taxes levied 
 24.1   in 2001 and 2002 2003, the adjusted levy limit base is equal to: 
 24.2      (1) the levy limit base computed under subdivisions 2 and 3 
 24.3   or section 275.72,; minus 
 24.4      (2) the total reduction for the local unit determined under 
 24.5   articles 2, 3, and 4 of this act for the distribution or aid 
 24.6   amount payable in 2004 pursuant to sections 477A.013 and 
 24.7   477A.0124; multiplied by: 
 24.8      (1) (3)(i) one plus a percentage equal to the percentage 
 24.9   growth in the implicit price deflator; 
 24.10     (2) (ii) one plus a percentage equal to the percentage 
 24.11  increase in number of households, if any, for the most recent 
 24.12  12-month period for which data is available; and 
 24.13     (3) (iii) one plus a percentage equal to 50 percent of the 
 24.14  percentage increase in the taxable market value of the 
 24.15  jurisdiction due to new construction of class 3 property, as 
 24.16  defined in section 273.13, subdivision 24, except for 
 24.17  state-assessed utility and railroad operating property, for the 
 24.18  most recent year for which data is available. 
 24.19     (b) For counties only, for taxes levied in 2001 and 2002 
 24.20  2003, the adjusted levy limit base is also reduced by any amount 
 24.21  of levy reduction required under section 275.07, subdivision 1, 
 24.22  paragraph (b), clause (ii). 
 24.23     [EFFECTIVE DATE.] This section is effective for taxes 
 24.24  payable in 2004 and thereafter. 
 24.25     Sec. 7.  Minnesota Statutes 2002, section 275.71, 
 24.26  subdivision 5, is amended to read: 
 24.27     Subd. 5.  [PROPERTY TAX LEVY LIMIT.] Notwithstanding any 
 24.28  other provision of a municipal charter which limits ad valorem 
 24.29  taxes to a lesser amount, or which would require a separate 
 24.30  voter approval for any increase, For taxes levied in 2001 and 
 24.31  2002 2003, the property tax levy limit for a local governmental 
 24.32  unit is equal to its adjusted levy limit base determined under 
 24.33  subdivision 4 plus any additional levy authorized under section 
 24.34  275.73, which is levied against net tax capacity, reduced by the 
 24.35  sum of (i) the total amount of aids and reimbursements that the 
 24.36  local governmental unit is certified to receive in 2004 under 
 25.1   sections 477A.011 to 477A.014, except for the increases in city 
 25.2   aid bases in calendar year 2002 under section 477A.011, 
 25.3   subdivision 36, paragraphs (n), (p), and (q), (ii) homestead and 
 25.4   agricultural aids it is certified to receive under section 
 25.5   273.1398, (iii) plus any taconite aids under sections 298.28 and 
 25.6   298.282 including any aid which was required to be placed in a 
 25.7   special fund for expenditure in the next succeeding year, (iv) 
 25.8   low-income housing aid under sections 477A.06 and 477A.065, and 
 25.9   (v) property tax replacement aids under section 174.242. 
 25.10     [EFFECTIVE DATE.] This section is effective for taxes 
 25.11  payable in 2004 and thereafter. 
 25.12     Sec. 8.  Minnesota Statutes 2002, section 275.71, 
 25.13  subdivision 6, is amended to read: 
 25.14     Subd. 6.  [LEVIES IN EXCESS OF LEVY LIMITS.] (a) If the 
 25.15  levy made by a city or county exceeds the levy limit provided in 
 25.16  sections 275.70 to 275.74, except when the excess levy is due to 
 25.17  the rounding of the rate in accordance with section 275.28, the 
 25.18  county auditor shall only extend the amount of taxes permitted 
 25.19  under sections 275.70 to 275.74, as provided for in section 
 25.20  275.16. 
 25.21     (b) For taxes levied in 2002, payable in 2003 only, if an 
 25.22  error was made in calculating the levy limit adjustment related 
 25.23  to a special levy for jails authorized under section 275.70, 
 25.24  subdivision 5, clause (11), in the previous year, the following 
 25.25  adjustments must be made: 
 25.26     (1) the county's levy limit base for taxes levied in 2002 
 25.27  must be based on the corrected adjusted levy limit base for 
 25.28  taxes levied in 2001; and 
 25.29     (2) the county's final levy limit for taxes levied in 2002, 
 25.30  payable in 2003, must also be temporarily reduced by an amount 
 25.31  equal to the amount of county levy spread in the previous year 
 25.32  in excess of the total recalculated levy limit plus authorized 
 25.33  special levies for taxes levied in 2001, payable in 2002. 
 25.34     (c) The commissioner of revenue shall inform counties 
 25.35  affected by paragraph (b) of the levy error and levy adjustments 
 25.36  required under this provision by June 15, 2002.  The county may 
 26.1   provide additional information to the commissioner indicating 
 26.2   why these adjustments may be in error by July 15, 2002.  The 
 26.3   commissioner shall certify the final levy adjustment to the 
 26.4   affected counties by August 1, 2002.  The levy reduction imposed 
 26.5   under paragraph (b), clause (2), may be spread over a period not 
 26.6   to exceed three years, upon agreement between the county and the 
 26.7   commissioner. 
 26.8      [EFFECTIVE DATE.] This section is effective for taxes 
 26.9   payable in 2004 and thereafter. 
 26.10     Sec. 9.  Minnesota Statutes 2002, section 275.73, 
 26.11  subdivision 2, is amended to read:  
 26.12     Subd. 2.  [LEVY EFFECTIVE DATE.] An additional levy 
 26.13  approved under subdivision 1 at a general or special election 
 26.14  held prior to September 1 on or before the first Tuesday in 
 26.15  November in any levy year may be levied in that same levy year 
 26.16  and subsequent levy years.  An additional levy approved under 
 26.17  subdivision 1 at a general or special election held after August 
 26.18  31 the first Tuesday in November in any levy year shall not be 
 26.19  levied in that same levy but may be levied in subsequent levy 
 26.20  years. 
 26.21     [EFFECTIVE DATE.] This section is effective for taxes 
 26.22  payable in 2004 and thereafter. 
 26.23     Sec. 10.  Minnesota Statutes 2002, section 275.74, 
 26.24  subdivision 2, is amended to read: 
 26.25     Subd. 2.  [AUTHORIZATION FOR SPECIAL LEVIES.] A local 
 26.26  governmental unit may request authorization to levy for 
 26.27  unreimbursed costs for natural disasters under section 275.70, 
 26.28  subdivision 5, clause (7) (8).  The local governmental unit 
 26.29  shall submit a request to levy under section 275.70, subdivision 
 26.30  5, clause (7) (8), to the commissioner of revenue by September 
 26.31  30 of the levy year and the request must include information 
 26.32  documenting the estimated unreimbursed costs.  The commissioner 
 26.33  of revenue may grant levy authority, up to the amount requested 
 26.34  based on the documentation submitted.  All decisions of the 
 26.35  commissioner are final. 
 26.36     [EFFECTIVE DATE.] This section is effective for taxes 
 27.1   payable in 2004 and thereafter. 
 27.2      Sec. 11.  Minnesota Statutes 2002, section 275.74, 
 27.3   subdivision 3, is amended to read: 
 27.4      Subd. 3.  [INFORMATION NECESSARY TO CALCULATE THE 2001 LEVY 
 27.5   LIMIT BASE.] A local governmental unit must provide the 
 27.6   commissioner with the information required to calculate the 
 27.7   alternative 2001 levy limit base amount under section 275.71, 
 27.8   subdivision 2, paragraph (a), clause (2), by July 20, 2001 of 
 27.9   the levy year.  If the information is not received by the 
 27.10  commissioner by that date, or is not deemed sufficient to make 
 27.11  the calculation under that clause, the commissioner has the 
 27.12  discretion to set the local governmental unit's 2001 levy limit 
 27.13  for all purposes including those purposes for which special 
 27.14  levies may be made, base equal to the amount of the local unit's 
 27.15  certified levy for the prior year minus the amount calculated 
 27.16  under section 275.71, subdivision 2 4, paragraph (a), 
 27.17  clause (1) (2). 
 27.18     [EFFECTIVE DATE.] This section is effective for taxes 
 27.19  payable in 2004 and thereafter. 
 27.20                             ARTICLE 5
 27.21             LOCAL GOVERNMENT AIDS AND LEVIES REPEALERS
 27.22     Section 1.  [REPEALER.] 
 27.23     Minnesota Statutes 2002, sections 477A.0121, subdivision 1; 
 27.24  and 477A.0122, subdivision 1, are repealed. 
 27.25     [EFFECTIVE DATE.] This section is effective for aid payable 
 27.26  in 2003 and thereafter. 
 27.27     Sec. 2.  [REPEALER.] 
 27.28     Minnesota Statutes 2002, sections 273.138; 273.1398, 
 27.29  subdivision 2; 273.166; 477A.011, subdivisions 36 and 37; 
 27.30  477A.0121, subdivisions 2, 3, 4, 5, and 6; 477A.0122, 
 27.31  subdivisions 2, 3, 4, 5, and 6; 477A.0123; 477A.03, subdivisions 
 27.32  3 and 4; 477A.06; 477A.065; and 477A.07, are repealed. 
 27.33     [EFFECTIVE DATE.] This section is effective for aid payable 
 27.34  in 2004 and thereafter. 
 27.35     Sec. 3.  [REPEALER.] 
 27.36     Minnesota Statutes 2002, section 275.71, subdivision 5, is 
 28.1   repealed. 
 28.2      [EFFECTIVE DATE.] This section is effective for taxes 
 28.3   payable in 2005 and thereafter. 
 28.4                              ARTICLE 6
 28.5                          FUNDS AND ACCOUNTS 
 28.6      Section 1.  Minnesota Statutes 2002, section 16A.152, 
 28.7   subdivision 1, is amended to read: 
 28.8      Subdivision 1.  [CASH FLOW ACCOUNT ESTABLISHED.] (a) A cash 
 28.9   flow account is created in the general fund in the state 
 28.10  treasury.  Beginning July 1, 2003, the commissioner of finance 
 28.11  shall restrict part or all of the balance before reserves in the 
 28.12  general fund as may be necessary to fund the cash flow account, 
 28.13  up to $350,000,000. 
 28.14     (b) The Amounts restricted are transferred to in the cash 
 28.15  flow account and shall remain in the account until drawn down 
 28.16  and used to meet cash flow deficiencies resulting from uneven 
 28.17  distribution of revenue collections and required expenditures 
 28.18  during a fiscal year. 
 28.19     Sec. 2.  Minnesota Statutes 2002, section 16A.152, 
 28.20  subdivision 1b, is amended to read: 
 28.21     Subd. 1b.  [BUDGET RESERVE INCREASE.] On June 30 July 1, 
 28.22  2003, the commissioner of finance shall 
 28.23  transfer $3,900,000 $300,000,000 to the budget reserve account 
 28.24  in the general fund.  On June 30 July 1, 2004, the commissioner 
 28.25  of finance shall transfer $12,300,000 $200,000,000 to the budget 
 28.26  reserve account in the general fund.  On June 30, 2005, the 
 28.27  commissioner of finance shall transfer $12,000,000 to the budget 
 28.28  reserve account in the general fund.  The amounts necessary for 
 28.29  this purpose are appropriated from the general fund. 
 28.30     Sec. 3.  Minnesota Statutes 2002, section 16A.152, 
 28.31  subdivision 2, is amended to read: 
 28.32     Subd. 2.  [ADDITIONAL REVENUES; PRIORITY.] If on the basis 
 28.33  of a forecast of general fund revenues and expenditures, the 
 28.34  commissioner of finance determines that there will be a positive 
 28.35  unrestricted budgetary general fund balance at the close of the 
 28.36  biennium, the commissioner of finance must allocate money to the 
 29.1   budget reserve until the total amount in the account equals 
 29.2   $653,000,000 the following accounts and purposes in priority 
 29.3   order: 
 29.4      (1) the cash flow account established in subdivision 1 
 29.5   until that account reaches $350,000,000; and 
 29.6      (2) the budget reserve account established in subdivision 
 29.7   1a until that account reaches five percent of the forecasted 
 29.8   expenditures in the odd-numbered fiscal year of the most 
 29.9   recently enacted biennial budget. 
 29.10     The amounts necessary to meet the requirements of this 
 29.11  section are appropriated from the general fund within two weeks 
 29.12  after the forecast is released. 
 29.13     Sec. 4.  Minnesota Statutes 2002, section 16A.152, 
 29.14  subdivision 7, is amended to read: 
 29.15     Subd. 7.  [DELAY; REDUCTION.] The commissioner may delay 
 29.16  paying up to 15 percent of an appropriation to a statutory or 
 29.17  home rule charter city, county, special taxing district, or a 
 29.18  system of higher education in that entity's fiscal year for up 
 29.19  to 60 days after the start of its next fiscal year.  The delayed 
 29.20  amount is subject to allotment reduction under subdivision 4. 
 29.21     [EFFECTIVE DATE.] This section is effective the day 
 29.22  following final enactment. 
 29.23     Sec. 5.  Minnesota Statutes 2002, section 62J.694, 
 29.24  subdivision 4, is amended to read: 
 29.25     Subd. 4.  [SUNSET.] The medical education endowment fund 
 29.26  expires June 30, 2015 July 1, 2003.  Upon expiration, the 
 29.27  commissioner of finance shall transfer the principal and any 
 29.28  remaining interest to the general fund. 
 29.29     Sec. 6.  Minnesota Statutes 2002, section 144.395, 
 29.30  subdivision 3, is amended to read: 
 29.31     Subd. 3.  [SUNSET.] The tobacco use prevention and local 
 29.32  public health endowment fund expires June 30, 2015 July 1, 2003. 
 29.33  Upon expiration, the commissioner of finance shall transfer the 
 29.34  principal and any remaining interest to the general fund.  
 29.35     Sec. 7.  Minnesota Statutes 2002, section 275.025, 
 29.36  subdivision 1, is amended to read: 
 30.1      Subdivision 1.  [LEVY AMOUNT.] The state general levy is 
 30.2   levied against commercial-industrial property and seasonal 
 30.3   recreational property, as defined in this section.  The state 
 30.4   general levy is $592,000,000 for taxes payable in 2002.  For 
 30.5   taxes payable in subsequent years, the levy is increased each 
 30.6   year by multiplying the amount for the prior year by the sum of 
 30.7   one plus the rate of increase, if any, in the implicit price 
 30.8   deflator for government consumption expenditures and gross 
 30.9   investment for state and local governments prepared by the 
 30.10  Bureau of Economic Analysts of the United States Department of 
 30.11  Commerce for the 12-month period ending March 31 of the year 
 30.12  prior to the year the taxes are payable.  The tax under this 
 30.13  section is not treated as a local tax rate under section 469.177 
 30.14  and is not the levy of a governmental unit under chapters 276A 
 30.15  and 473F.  Beginning in fiscal year 2004, and in each year 
 30.16  thereafter, the commissioner of finance shall deposit in an 
 30.17  education reserve account, which account is hereby established, 
 30.18  the increased amount of the state general levy received for 
 30.19  deposit in the general fund for that year over the amount of the 
 30.20  state general levy received for deposit in the general fund in 
 30.21  fiscal year 2003.  The amounts in the education reserve account 
 30.22  do not lapse or cancel each year, but remain until appropriated 
 30.23  by law for education aid or higher education funding. 
 30.24     [EFFECTIVE DATE.] This section is effective June 30, 2003. 
 30.25     Sec. 8.  Laws 2002, chapter 377, article 12, section 17, is 
 30.26  amended to read: 
 30.27     Sec. 17.  [APPROPRIATION.] 
 30.28     (a) $585,000 in fiscal year 2002 and $7,015,000 in fiscal 
 30.29  year 2003 are appropriated to the commissioner of revenue from 
 30.30  the general fund for tax compliance activities, including 
 30.31  identification and collection of tax liabilities from 
 30.32  individuals and businesses that currently do not pay all taxes 
 30.33  owed, and audit and collection activity in the income tax, sales 
 30.34  tax, lawful gambling, insurance, and corporate areas.  The base 
 30.35  funding for these activities in fiscal years 2004 and 2005 is 
 30.36  increased by $4,750,000 each year. 
 31.1      (b) The commissioner must include these tax compliance 
 31.2   activities in the report required by Laws 2001, First Special 
 31.3   Session chapter 10, article 1, section 16, subdivision 2, 
 31.4   paragraph (c). 
 31.5      (c) Laws 2002, chapter 220, article 10, section 38, does 
 31.6   not apply to the positions necessary to carry out the compliance 
 31.7   activities identified in this section. 
 31.8      (d) If the legislative auditor determines that: 
 31.9      (1) actual revenue collections generated from tax 
 31.10  compliance activities funded by Laws 2001, First Special Session 
 31.11  chapter 10, article 1, section 16, subdivision 2, paragraphs (a) 
 31.12  and (b), will not generate at least $52,000,000 in additional 
 31.13  general fund revenue for the biennium ending June 30, 2003; or 
 31.14     (2) actual revenue collections generated from new tax 
 31.15  compliance activities funded by the appropriation in this 
 31.16  section will not generate at least $7,600,000 in additional 
 31.17  general fund revenue for the biennium ending June 30, 2003; 
 31.18  then the commissioner of finance must cancel from the budget 
 31.19  reserve account to the general fund the difference between the 
 31.20  $52,000,000 or the $7,600,000 and the actual additional general 
 31.21  fund revenue.  The legislative auditor's determination under 
 31.22  this paragraph must be made in the February 1, 2003, report to 
 31.23  the legislature required by Laws 2001, First Special Session 
 31.24  chapter 10, article 1, section 16. 
 31.25     [EFFECTIVE DATE.] This section is effective the day 
 31.26  following final enactment. 
 31.27                             ARTICLE 7
 31.28                           MISCELLANEOUS 
 31.29     Section 1.  Minnesota Statutes 2002, section 289A.20, 
 31.30  subdivision 4, is amended to read: 
 31.31     Subd. 4.  [SALES AND USE TAX.] (a) The taxes imposed by 
 31.32  chapter 297A are due and payable to the commissioner monthly on 
 31.33  or before the 20th day of the month following the month in which 
 31.34  the taxable event occurred, or following another reporting 
 31.35  period as the commissioner prescribes or as allowed under 
 31.36  section 289A.18, subdivision 4, paragraph (f), except that use 
 32.1   taxes due on an annual use tax return as provided under section 
 32.2   289A.11, subdivision 1, are payable by April 15 following the 
 32.3   close of the calendar year. 
 32.4      (b) For a fiscal year ending before July 1, 2002, A vendor 
 32.5   having a liability of $120,000 or more during a fiscal year 
 32.6   ending June 30 must remit the June liability for the next year 
 32.7   in the following manner: 
 32.8      (1) Two business days before June 30 of the year, the 
 32.9   vendor must remit 75 percent of the estimated June liability to 
 32.10  the commissioner.  
 32.11     (2) On or before August 20 of the year, the vendor must pay 
 32.12  any additional amount of tax not remitted in June. 
 32.13     (c) A vendor having a liability of $120,000 or more during 
 32.14  a fiscal year ending June 30 must remit all liabilities on 
 32.15  returns due for periods beginning in the subsequent calendar 
 32.16  year by electronic means on or before the 20th day of the month 
 32.17  following the month in which the taxable event occurred, or on 
 32.18  or before the 20th day of the month following the month in which 
 32.19  the sale is reported under section 289A.18, subdivision 4, 
 32.20  except for 75 percent of the estimated June liability, which is 
 32.21  due two business days before June 30.  The remaining amount of 
 32.22  the June liability is due on August 20.  
 32.23     [EFFECTIVE DATE.] This section is effective the day 
 32.24  following final enactment. 
 32.25     Sec. 2.  Minnesota Statutes 2002, section 297A.94, is 
 32.26  amended to read: 
 32.27     297A.94 [DEPOSIT OF REVENUES.] 
 32.28     (a) Except as provided in this section, the commissioner 
 32.29  shall deposit the revenues, including interest and penalties, 
 32.30  derived from the taxes imposed by this chapter in the state 
 32.31  treasury and credit them to the general fund.  
 32.32     (b) The commissioner shall deposit taxes in the Minnesota 
 32.33  agricultural and economic account in the special revenue fund if:
 32.34     (1) the taxes are derived from sales and use of property 
 32.35  and services purchased for the construction and operation of an 
 32.36  agricultural resource project; and 
 33.1      (2) the purchase was made on or after the date on which a 
 33.2   conditional commitment was made for a loan guaranty for the 
 33.3   project under section 41A.04, subdivision 3. 
 33.4   The commissioner of finance shall certify to the commissioner 
 33.5   the date on which the project received the conditional 
 33.6   commitment.  The amount deposited in the loan guaranty account 
 33.7   must be reduced by any refunds and by the costs incurred by the 
 33.8   department of revenue to administer and enforce the assessment 
 33.9   and collection of the taxes.  
 33.10     (c) The commissioner shall deposit the revenues, including 
 33.11  interest and penalties, derived from the taxes imposed on sales 
 33.12  and purchases included in section 297A.61, subdivision 3, 
 33.13  paragraph (g), clauses (1) and (4), in the state treasury, and 
 33.14  credit them as follows: 
 33.15     (1) first to the general obligation special tax bond debt 
 33.16  service account in each fiscal year the amount required by 
 33.17  section 16A.661, subdivision 3, paragraph (b); and 
 33.18     (2) after the requirements of clause (1) have been met, the 
 33.19  balance to the general fund. 
 33.20     (d) The commissioner shall deposit the revenues, including 
 33.21  interest and penalties, collected under section 297A.64, 
 33.22  subdivision 5, in the state treasury and credit them to the 
 33.23  general fund.  By July 15 of each year the commissioner shall 
 33.24  transfer to the highway user tax distribution fund an amount 
 33.25  equal to the excess fees collected under section 297A.64, 
 33.26  subdivision 5, for the previous calendar year. 
 33.27     (e) For fiscal year 2001, 97 percent; for fiscal years 2002 
 33.28  and 2003, 87 percent; and for fiscal year 2004 and thereafter, 
 33.29  87.1 74 percent of the revenues, including interest and 
 33.30  penalties, transmitted to the commissioner under section 
 33.31  297A.65, must be deposited by the commissioner in the state 
 33.32  treasury as follows: 
 33.33     (1) 50 percent of the receipts must be deposited in the 
 33.34  heritage enhancement account in the game and fish fund, and may 
 33.35  be spent only on activities that improve, enhance, or protect 
 33.36  fish and wildlife resources, including conservation, 
 34.1   restoration, and enhancement of land, water, and other natural 
 34.2   resources of the state; 
 34.3      (2) 22.5 percent of the receipts must be deposited in the 
 34.4   natural resources fund, and may be spent only for state parks 
 34.5   and trails; 
 34.6      (3) 22.5 percent of the receipts must be deposited in the 
 34.7   natural resources fund, and may be spent only on metropolitan 
 34.8   park and trail grants; 
 34.9      (4) three percent of the receipts must be deposited in the 
 34.10  natural resources fund, and may be spent only on local trail 
 34.11  grants; and 
 34.12     (5) two percent of the receipts must be deposited in the 
 34.13  natural resources fund, and may be spent only for the Minnesota 
 34.14  zoological garden, the Como park zoo and conservatory, and the 
 34.15  Duluth zoo. 
 34.16     (f) The revenue dedicated under paragraph (e) may not be 
 34.17  used as a substitute for traditional sources of funding for the 
 34.18  purposes specified, but the dedicated revenue shall supplement 
 34.19  traditional sources of funding for those purposes.  Land 
 34.20  acquired with money deposited in the game and fish fund under 
 34.21  paragraph (e) must be open to public hunting and fishing during 
 34.22  the open season, except that in aquatic management areas or on 
 34.23  lands where angling easements have been acquired, fishing may be 
 34.24  prohibited during certain times of the year and hunting may be 
 34.25  prohibited.  At least 87 percent of the money deposited in the 
 34.26  game and fish fund for improvement, enhancement, or protection 
 34.27  of fish and wildlife resources under paragraph (e) must be 
 34.28  allocated for field operations. 
 34.29     [EFFECTIVE DATE.] This section is effective the day 
 34.30  following final enactment. 
 34.31     Sec. 3.  Minnesota Statutes 2002, section 297F.10, 
 34.32  subdivision 1, is amended to read: 
 34.33     Subdivision 1.  [TAX AND USE TAX ON CIGARETTES.] Revenue 
 34.34  received from cigarette taxes, as well as related penalties, 
 34.35  interest, license fees, and miscellaneous sources of revenue 
 34.36  shall be deposited by the commissioner in the state treasury and 
 35.1   credited as follows: 
 35.2      (a) first to the general obligation special tax bond debt 
 35.3   service account in each fiscal year the amount required to 
 35.4   increase the balance on hand in the account on each December 1 
 35.5   to an amount equal to the full amount of principal and interest 
 35.6   to come due on all outstanding bonds whose debt service is 
 35.7   payable primarily from the proceeds of the tax to and including 
 35.8   the second following July 1; and 
 35.9      (b) after the requirements of paragraph (a) have been met: 
 35.10     (1) the revenue produced by one mill 3.25 mills of the tax 
 35.11  on cigarettes weighing not more than three pounds a thousand and 
 35.12  two 6.5 mills of the tax on cigarettes weighing more than three 
 35.13  pounds a thousand must be credited to the Minnesota future 
 35.14  resources fund academic health center special revenue fund 
 35.15  hereby created and is annually appropriated to the board of 
 35.16  regents at the University of Minnesota for academic health 
 35.17  center funding at the University of Minnesota; and 
 35.18     (2) the revenue produced by 1.25 mills of the tax on 
 35.19  cigarettes weighing not more than three pounds a thousand and 
 35.20  2.5 mills of the tax on cigarettes weighing more than three 
 35.21  pounds a thousand must be credited to the medical education and 
 35.22  research costs special revenue fund hereby created and is 
 35.23  annually appropriated to the commissioner of health for medical 
 35.24  education and research funding at the department of health; and 
 35.25     (3) the balance of the revenues derived from taxes, 
 35.26  penalties, and interest (under this chapter) and from license 
 35.27  fees and miscellaneous sources of revenue shall be credited to 
 35.28  the general fund. 
 35.29     [EFFECTIVE DATE.] This section is effective for all 
 35.30  revenues received after June 30, 2003. 
 35.31     Sec. 4.  Laws 2001, First Special Session chapter 5, 
 35.32  article 12, section 95, as amended by Laws 2002, chapter 377, 
 35.33  article 3, section 24, is amended to read: 
 35.34     Sec. 95.  [REPEALER.] 
 35.35     (a) Minnesota Statutes 2000, sections 297A.61, subdivision 
 35.36  16; 297A.68, subdivision 21; and 297A.71, subdivision 2, are 
 36.1   repealed effective for sales and purchases occurring after June 
 36.2   30, 2001, except that the repeal of section 297A.61, subdivision 
 36.3   16, paragraph (d), is effective for sales and purchases 
 36.4   occurring after July 31, 2001. 
 36.5      (b) Minnesota Statutes 2000, sections 297A.62, subdivision 
 36.6   2, and 297A.64, subdivision 1, are repealed effective for sales 
 36.7   and purchases made after December 31, 2005. 
 36.8      (c) Minnesota Statutes 2000, section 297A.71, subdivision 
 36.9   15, is repealed effective for sales and purchases made after 
 36.10  June 30, 2002. 
 36.11     (d) Minnesota Statutes 2000, section 289A.60, subdivision 
 36.12  15, is repealed effective for liabilities after January 1, 2004. 
 36.13     (e) Minnesota Statutes 2000, section 297A.71, subdivision 
 36.14  16, is repealed effective for sales and purchases occurring 
 36.15  after December 31, 2002. 
 36.16     Sec. 5.  [REPEALER.] 
 36.17     Minnesota Statutes 2002, section 325E.112, subdivision 2a, 
 36.18  is repealed. 
 36.19     [EFFECTIVE DATE.] This section is effective July 1, 2003.