Minnesota Legislature
SF 1019
6th Engrossment - 79th Legislature (1995 - 1996) Posted on 12/15/2009 12:00am
KEY: stricken = removed, old language.
underscored = added, new language.
Current Version - 6th Engrossment
1.1 A bill for an act 1.2 relating to metropolitan government; establishing the 1.3 metropolitan livable communities fund and providing 1.4 for fund distribution; reducing the levy authority of 1.5 the metropolitan mosquito control commission; 1.6 providing for certain revenue sharing; regulating 1.7 employee layoffs by the metropolitan mosquito control 1.8 district; authorizing an economic vitality and housing 1.9 initiative; amending Minnesota Statutes 1994, sections 1.10 116J.552, subdivision 2; 116J.555, subdivision 2; 1.11 116J.556; 473.167, subdivisions 2, 3, and by adding a 1.12 subdivision; 473.711, subdivision 2; and 473F.08, 1.13 subdivisions 3a, 5, 7a, and by adding a subdivision; 1.14 proposing coding for new law in Minnesota Statutes, 1.15 chapter 473; repealing Minnesota Statutes 1994, 1.16 sections 504.33; 504.34; and 504.35. 1.17 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 1.18 ARTICLE 1 1.19 METROPOLITAN LIVABLE COMMUNITIES ACT 1.20 Section 1. [473.25] [LIVABLE COMMUNITIES CRITERIA AND 1.21 GUIDELINES.] 1.22 (a) The council shall establish criteria for uses of the 1.23 fund provided in section 473.251 that are consistent with and 1.24 promote the purposes of this article and the policies of the 1.25 metropolitan development guide adopted by the council including, 1.26 but not limited to: 1.27 (1) helping to change long-term market incentives that 1.28 adversely impact creation and preservation of living-wage jobs 1.29 in the fully developed area; 1.30 (2) creating incentives for developing communities to 1.31 include a full range of housing opportunities; 2.1 (3) creating incentives to preserve and rehabilitate 2.2 affordable housing in the fully developed area; and 2.3 (4) creating incentives for all communities to implement 2.4 compact and efficient development. 2.5 (b) The council shall establish guidelines for the livable 2.6 community demonstration account for projects that the council 2.7 would consider funding with either grants or loans. The 2.8 guidelines must provide that the projects will: 2.9 (1) interrelate development or redevelopment and transit; 2.10 (2) interrelate affordable housing and employment growth 2.11 areas; 2.12 (3) intensify land use that leads to more compact 2.13 development or redevelopment; 2.14 (4) involve development or redevelopment that mixes incomes 2.15 of residents in housing, including introducing or reintroducing 2.16 higher value housing in lower income areas to achieve a mix of 2.17 housing opportunities; or 2.18 (5) encourage public infrastructure investments which 2.19 connect urban neighborhoods and suburban communities, attract 2.20 private sector redevelopment investment in commercial and 2.21 residential properties adjacent to the public improvement, and 2.22 provide project area residents with expanded opportunities for 2.23 private sector employment. 2.24 (c) The council shall establish guidelines governing who 2.25 may apply for a grant or loan from the fund, providing priority 2.26 for proposals using innovative partnerships between government, 2.27 private for-profit, and nonprofit sectors. 2.28 (d) The council shall prepare an annual plan for 2.29 distribution of the fund based on the criteria for project and 2.30 applicant selection. 2.31 (e) The council shall prepare and submit to the 2.32 legislature, as provided in section 3.195, an annual report on 2.33 the metropolitan livable communities fund. The report must 2.34 include information on the amount of money in the fund, the 2.35 amount distributed, to whom the funds were distributed and for 2.36 what purposes, and an evaluation of the effectiveness of the 3.1 projects funded in meeting the policies and goals of the 3.2 council. The report may make recommendations to the legislature 3.3 on changes to this act. 3.4 Sec. 2. [473.251] [METROPOLITAN LIVABLE COMMUNITIES FUND.] 3.5 The metropolitan livable communities fund is created and 3.6 consists of the following accounts: 3.7 (1) the tax base revitalization account; 3.8 (2) the livable communities demonstration account; and 3.9 (3) the local housing incentives account. 3.10 Sec. 3. [473.252] [TAX BASE REVITALIZATION ACCOUNT.] 3.11 Subdivision 1. [DEFINITION.] For the purposes of this 3.12 section, "municipality" means a statutory or home rule charter 3.13 city or town participating in the local housing incentives 3.14 program under section 473.254, or a county in the metropolitan 3.15 area. 3.16 Subd. 2. [SOURCES OF FUNDS.] The council shall credit to 3.17 the tax base revitalization account within the fund the amount, 3.18 if any, provided for under section 473.167, subdivision 3a, 3.19 paragraph (b), and the amount, if any, distributed to the 3.20 council under section 473F.08, subdivision 3b. 3.21 Subd. 3. [DISTRIBUTION OF FUNDS.] (a) The council must use 3.22 the funds in the account to make grants to municipalities for 3.23 the cleanup of polluted land in the metropolitan area. A grant 3.24 to a metropolitan county must be used for a project in a 3.25 participating municipality. The council shall prescribe and 3.26 provide the grant application form to municipalities. The 3.27 council must consider the probability of funding from other 3.28 sources when making grants under this section. 3.29 (b)(1) The legislature expects that applications for grants 3.30 will exceed the available funds and the council will be able to 3.31 provide grants to only some of the applicant municipalities. If 3.32 applications for grants for qualified sites exceed the available 3.33 funds, the council shall make grants that provide the highest 3.34 return in public benefits for the public costs incurred, that 3.35 encourage commercial and industrial development that will lead 3.36 to the preservation or growth of living-wage jobs and that 4.1 enhance the tax base of the recipient municipality. 4.2 (2) In making grants, the council shall establish regular 4.3 application deadlines in which grants will be awarded from the 4.4 available money in the account. If the council provides for 4.5 application cycles of less than six-month intervals, the council 4.6 must reserve at least 40 percent of the receipts of the account 4.7 for a year for application deadlines that occur in the second 4.8 half of the year. If the applications for grants exceed the 4.9 available funds for an application cycle, no more than one-half 4.10 of the funds may be granted to projects in a statutory or home 4.11 rule charter city and no more than three-quarters of the funds 4.12 may be granted to projects located in cities of the first class. 4.13 (c) A municipality may use the grant to provide a portion 4.14 of the local match requirement for project costs that qualify 4.15 for a grant under sections 116J.551 to 116J.557. 4.16 Sec. 4. [473.253] [LIVABLE COMMUNITIES DEMONSTRATION 4.17 ACCOUNT.] 4.18 Subdivision 1. [SOURCES OF FUNDS.] The council shall 4.19 credit to the livable communities demonstration account the 4.20 revenues provided in this subdivision. This tax shall be levied 4.21 and collected in the manner provided by section 473.13. The 4.22 levy shall not exceed the following amount for the years 4.23 specified: 4.24 (a)(1) for taxes payable in 1996, 50 percent of (i) the 4.25 metropolitan mosquito control commission's property tax levy for 4.26 taxes payable in 1995 multiplied by (ii) an index for market 4.27 valuation changes equal to the total market valuation of all 4.28 taxable property located within the metropolitan area for the 4.29 current taxes payable year divided by the total market valuation 4.30 of all taxable property located in the metropolitan area for the 4.31 previous taxes payable year; and 4.32 (2) for taxes payable in 1997 and subsequent years, the 4.33 product of (i) the property tax levy limit under this 4.34 subdivision for the previous year multiplied by (ii) an index 4.35 for market valuation changes equal to the total market valuation 4.36 of all taxable property located within the metropolitan area for 5.1 the current taxes payable year divided by the total market 5.2 valuation of all taxable property located in the metropolitan 5.3 area for the previous taxes payable year. 5.4 For the purposes of this subdivision, "total market 5.5 valuation" means the total market valuation of all taxable 5.6 property within the metropolitan area without valuation 5.7 adjustments for fiscal disparities under chapter 473F, tax 5.8 increment financing under sections 469.174 to 469.179, and high 5.9 voltage transmission lines under section 273.425. 5.10 (b) The metropolitan council, for the purposes of the fund, 5.11 is considered a unique taxing jurisdiction for purposes of 5.12 receiving aid pursuant to section 273.1398. For aid to be 5.13 received in 1996, the fund's homestead and agricultural credit 5.14 base shall equal 50 percent of the metropolitan mosquito control 5.15 commission's certified homestead and agricultural credit aid for 5.16 1995, determined under section 273.1398, subdivision 2, less any 5.17 permanent aid reduction under section 477A.0132. For aid to be 5.18 received under section 273.1398 in 1997 and subsequent years, 5.19 the fund's homestead and agricultural credit base shall be 5.20 determined in accordance with section 273.1398, subdivision 1. 5.21 Subd. 2. [DISTRIBUTION OF FUNDS.] The council shall use 5.22 the funds in the livable communities demonstration account to 5.23 make grants or loans to municipalities participating in the 5.24 local housing incentives program under section 473.254 or to 5.25 metropolitan area counties to fund the initiatives specified in 5.26 section 473.25, paragraph (b), in participating municipalities. 5.27 Sec. 5. [473.254] [LOCAL HOUSING INCENTIVES ACCOUNT.] 5.28 Subdivision 1. [PARTICIPATION.] (a) By November 15 of each 5.29 year, a municipality may elect to participate in the local 5.30 housing incentive account program. If a municipality does not 5.31 elect to participate for the year, it is not subject to this 5.32 section. For purposes of this section, municipality means a 5.33 municipality electing to participate in the local housing 5.34 incentive account program, unless the context indicates 5.35 otherwise. 5.36 (b) A municipality that elects to participate may receive 6.1 grants or loans from the tax base revitalization account, 6.2 livable communities demonstration account, or the local housing 6.3 incentive account. A municipality that does not participate is 6.4 not eligible to receive a grant under sections 116J.551 to 6.5 116J.557. The council, when making discretionary funding 6.6 decisions, shall give consideration to a municipality's 6.7 participation in the local housing incentives program. 6.8 Subd. 2. [AFFORDABLE AND LIFE-CYCLE HOUSING GOALS.] The 6.9 council shall negotiate with each municipality to establish 6.10 affordable and life-cycle housing goals for that municipality 6.11 that are consistent with and promote the policies of the 6.12 metropolitan council as provided in the adopted metropolitan 6.13 development guide. The council shall adopt, by resolution after 6.14 a public hearing, the negotiated affordable and life-cycle 6.15 housing goals for each municipality by January 15, 1996. By 6.16 June 30, 1996, each municipality shall identify to the council 6.17 the actions it plans to take to meet the established housing 6.18 goals. 6.19 Subd. 3. [AFFORDABLE AND LIFE-CYCLE HOUSING OPPORTUNITIES 6.20 AMOUNT.] (1) By July 1, 1996, each county assessor shall certify 6.21 each municipality's average residential homestead limited market 6.22 value for the 1994 assessment year, including the value of the 6.23 farm house, garage, and one acre only in the case of farm 6.24 homesteads, multiplied by a factor of two, as the municipality's 6.25 "market value base amount." For 1997 and thereafter, the 6.26 "market value base amount" shall be equal to the product of (i) 6.27 the market value base amount for the previous year multiplied by 6.28 (ii) the annual average United States Consumer Price Index for 6.29 all urban consumers, United States average, as determined by the 6.30 United States Department of Labor, for the previous year divided 6.31 by that annual average for the year before the previous year. 6.32 (2) By July 1, 1996, and each succeeding year the county 6.33 assessor shall determine which homesteads have market values in 6.34 excess of the municipality's market value base amount and the 6.35 county auditor shall certify the aggregate net tax capacity 6.36 corresponding to the amount by which those homesteads' market 7.1 values exceed the municipality's market value base amount as the 7.2 "net tax capacity excess amount" for the assessment year 7.3 corresponding to the current taxes payable year. By July 1, 7.4 1996, the county auditor shall also certify the net tax capacity 7.5 excess amount for taxes payable in 1995. 7.6 (3) By July 1, 1996, and each succeeding year, the county 7.7 auditor shall also certify each municipality's local tax rate 7.8 for the current taxes payable year. 7.9 (4) By July 1, 1996, and each succeeding year, the county 7.10 auditor shall certify for each municipality the amount equal to 7.11 four percent of the municipality's current year total 7.12 residential homestead tax capacity multiplied by the local tax 7.13 rate. 7.14 (5) By August 1, 1996, and each succeeding year, the 7.15 metropolitan council shall notify each municipality of its 7.16 "affordable and life-cycle housing opportunities amount" for the 7.17 following calendar year equal to the lesser of the amount 7.18 certified under clause (4) or the amount, if any, by which the 7.19 net tax capacity excess amount for the current year exceeds the 7.20 amount for taxes payable in 1995, multiplied by the 7.21 municipality's local tax rate certified in clause (3). 7.22 Subd. 4. [AFFORDABLE AND LIFE-CYCLE HOUSING REQUIREMENT.] 7.23 (a) A municipality that is determined by the council to have met 7.24 its affordable and life-cycle housing goals in the previous 7.25 calendar year may retain the amount calculated under subdivision 7.26 3 to maintain existing affordable and life-cycle housing. 7.27 (b) In 1998, and thereafter, a municipality that is 7.28 determined by the council not to have met the affordable and 7.29 life-cycle housing goals in the previous calendar year, as 7.30 negotiated and agreed to with the council, and not to have spent 7.31 85 percent of its affordable and life-cycle housing 7.32 opportunities amount to create affordable and life-cycle housing 7.33 opportunities in the previous calendar year must do one of the 7.34 following with the affordable and life-cycle housing 7.35 opportunities amount for the previous year as determined under 7.36 subdivision 3: 8.1 (1) distribute it to the local housing incentives account; 8.2 or 8.3 (2) distribute it to the housing and redevelopment 8.4 authority of the city or county in which the municipality is 8.5 located to create affordable and life-cycle housing 8.6 opportunities in the municipality. 8.7 A municipality may enter into agreements with adjacent 8.8 municipalities to cooperatively provide affordable and 8.9 life-cycle housing. The housing may be provided in any of the 8.10 cooperating municipalities, but must meet the combined housing 8.11 goals of each participating municipality. 8.12 Subd. 5. [SOURCES OF FUNDS.] (a) The council shall credit 8.13 to the local housing incentives account any revenues derived 8.14 from municipalities under subdivision 4, paragraph (b), clause 8.15 (1). 8.16 (b) The council shall credit $1,000,000 of the proceeds of 8.17 solid waste bonds issued by the council under Minnesota 8.18 Statutes, section 473.831, before its repeal, to the local 8.19 housing incentives account in the metropolitan livable 8.20 communities fund. In 1998 and each year thereafter, the council 8.21 shall credit $1,000,000 of the revenues generated by the levy 8.22 authorized in section 473.249 to the local housing incentives 8.23 account. 8.24 (c) In 1997, and each year thereafter, the council shall 8.25 transfer $500,000 from the livable communities demonstration 8.26 account to the local housing incentives account. 8.27 Subd. 6. [DISTRIBUTION OF FUNDS.] The funds in the account 8.28 must be distributed annually by the council to municipalities 8.29 that: 8.30 (1) have not met their affordable and life-cycle housing 8.31 goals as determined by the council; and 8.32 (2) are actively funding projects designed to help meet the 8.33 goals. 8.34 The funds distributed by the council must be matched on a 8.35 dollar-for-dollar basis by the municipality receiving the 8.36 funds. When distributing funds in the account, the council must 9.1 give priority to those municipalities that (1) have contribution 9.2 net tax capacities that exceed their distribution net tax 9.3 capacities by more than $200 per household, (2) demonstrate the 9.4 proposed project will link employment opportunities with 9.5 affordable and life-cycle housing, and (3) provide matching 9.6 funds from a source other than the required amount under 9.7 subdivision 3. For the purposes of this subdivision, 9.8 "municipality" means a statutory or home rule charter city or 9.9 town in the metropolitan area. 9.10 Subd. 7. [REPORTING REQUIREMENT.] Beginning January 15, 9.11 1998, and annually thereafter, each municipality must report to 9.12 the council the following: 9.13 (1) the tax revenues defined in subdivision 3 that were 9.14 levied in the prior year; 9.15 (2) the portion of the revenues that were spent on meeting 9.16 the municipality's affordable and life-cycle housing goals; and 9.17 (3) information on how the expenditures directly support 9.18 the municipality's efforts to meet its affordable and life-cycle 9.19 housing goals. 9.20 The council shall verify each municipality's compliance 9.21 with this subdivision. 9.22 Subd. 8. [LATER ELECTION TO PARTICIPATE.] If a 9.23 municipality did not participate for one or more years and 9.24 elects later to participate, the municipality must establish 9.25 that it has spent or agrees to spend on affordable and 9.26 life-cycle housing, or agrees to distribute to the local housing 9.27 incentives account, an amount equivalent to what it would have 9.28 spent on affordable and life-cycle housing had goals been 9.29 established under this section for the period in which it was 9.30 not participating. The council will determine which investments 9.31 count toward the required cumulative investment amount by 9.32 comparing the municipality to participating municipalities 9.33 similar in terms of stage of development and demographics. If 9.34 it determines it to be in the best interests of the region, the 9.35 council may waive a reasonable portion of the cumulative 9.36 investment amount. 10.1 Subd. 9. [REPORT TO THE LEGISLATURE.] By February 1 of 10.2 each year, the council must report to the legislature the 10.3 municipalities that have elected to participate and not to 10.4 participate under subdivision 1. This report must be filed as 10.5 provided in section 3.195. 10.6 Subd. 10. [COMPREHENSIVE REPORT CARD ON AFFORDABLE AND 10.7 LIFE CYCLE HOUSING.] The metropolitan council shall present to 10.8 the legislature and release to the public by November 15, 1996, 10.9 and each year thereafter a comprehensive report card on 10.10 affordable and life cycle housing in each municipality in the 10.11 metropolitan area. The report card must include information on 10.12 government, nonprofit, and marketplace efforts. 10.13 Sec. 6. [PROGRAM EVALUATION.] 10.14 The metropolitan council shall submit a report to the 10.15 legislature by January 15, 2003, evaluating the metropolitan 10.16 livable communities act. The report must include an accounting 10.17 of the funds credited to the tax base revitalization account, 10.18 the livable communities demonstration account, and the local 10.19 housing incentives account, a summary of how the funds were 10.20 spent, an analysis of the costs and benefits of the program, and 10.21 recommendations for future legislative action regarding the 10.22 program. 10.23 Sec. 7. [2020 REPORT.] 10.24 The metropolitan council shall report to the legislature by 10.25 January 15, 1996, on the probable development patterns in and 10.26 affecting the metropolitan area by the year 2020 under various 10.27 scenarios, including the present course of growth versus 10.28 directed, compact, and efficient development. The report should 10.29 consider impacts on the greater metropolitan region, including 10.30 within it counties in which five percent or more of residents 10.31 commute to employment in the present metropolitan region or 10.32 which are part of the metropolitan area as defined by the U.S. 10.33 Department of Commerce Standard Metropolitan Statistical Area. 10.34 Sec. 8. [APPLICATION.] 10.35 This article applies in the counties of Anoka, Carver, 10.36 Dakota, Hennepin, Ramsey, Scott, and Washington. 11.1 Sec. 9. [EFFECTIVE DATE.] 11.2 This article is effective the day after final enactment. 11.3 Section 4 is effective for taxes levied in 1995 and payable in 11.4 1996, and subsequent years. 11.5 ARTICLE 2 11.6 MISCELLANEOUS AMENDMENTS 11.7 Section 1. Minnesota Statutes 1994, section 116J.552, 11.8 subdivision 2, is amended to read: 11.9 Subd. 2. [CLEANUP COSTS.] "Cleanup costs" or "costs" 11.10meanmeans thecostcosts of developing and implementingan11.11approveda response action plan, but does not include 11.12 implementation costs incurred before the award of a grant unless 11.13 the application for the grant was submitted within 180 days 11.14 after the response action plan was approved by the commissioner 11.15 of the pollution control agency. 11.16 Sec. 2. Minnesota Statutes 1994, section 116J.555, 11.17 subdivision 2, is amended to read: 11.18 Subd. 2. [APPLICATION CYCLES; REPORTING TO LCWM.] (a) In 11.19 making grants, the commissioner shall establishregular11.20 semiannual application deadlines in which grants will be 11.21 authorized from all or part of the available appropriations of 11.22 money in the account. 11.23 (b) After each semiannual cycle in which grants are 11.24 awarded, the commissioner shall report to the legislative 11.25 commission on waste management the grants awarded and 11.26 appropriate supporting information describing each grant made. 11.27 This report must be made within 30 days after the grants are 11.28 awarded. 11.29 (c) The commissioner shall annually report to the 11.30 legislative commission on the status of the cleanup projects 11.31 undertaken under grants made under the programs. The 11.32 commissioner shall include in the annual report information on 11.33 the cleanup and development activities undertaken for the grants 11.34 made in that and previous fiscal years. The commissioner shall 11.35 make this report no later than 120 days after the end of the 11.36 fiscal year. 12.1 Sec. 3. Minnesota Statutes 1994, section 116J.554, is 12.2 amended by adding a subdivision to read: 12.3 Subd. 1a. [METROPOLITAN LIVABLE COMMUNITIES.] The 12.4 commissioner may not make a grant to a municipality in the 12.5 metropolitan area unless it is participating in the local 12.6 housing incentives program under section 473.254. 12.7 Sec. 4. Minnesota Statutes 1994, section 116J.556, is 12.8 amended to read: 12.9 116J.556 [LOCAL MATCH REQUIREMENT.] 12.10 (a) In order to qualify for a grant under sections 116J.551 12.11 to 116J.557, the municipality must pay for at least one-half of 12.12 the project costs as a local match. The municipality shall pay 12.13 an amount of the project costs equal to at least1812 percent 12.14 of the cleanup costs from the municipality's general fund, a 12.15 property tax levy for that purpose, or other unrestricted money 12.16 available to the municipality (excluding tax increments). These 12.17 unrestricted moneys may be spent for project costs, other than 12.18 cleanup costs, and qualify for the local match payment equal to 12.191812 percent of cleanup costs. The rest of the local match may 12.20 be paid with tax increments, regional, state, or federal money 12.21 available for the redevelopment of brownfields or any other 12.22 money available to the municipality. 12.23 (b) If the development authority establishes a tax 12.24 increment financing district or hazardous substance subdistrict 12.25 on the site to pay for part of the local match requirement, the 12.26 district or subdistrict is not subject to the state aid 12.27 reductions under section 273.1399. In order to qualify for the 12.28 exemption from the state aid reductions, the municipality must 12.29 elect, by resolution, on or before the request for certification 12.30 is filed that all tax increments from the district or 12.31 subdistrict will be used exclusively to pay (1) for project 12.32 costs for the site and (2) administrative costs for the district 12.33 or subdistrict. The district or subdistrict must be decertified 12.34 when an amount of tax increments equal to no more than three 12.35 times the costs of implementing the response action plan for the 12.36 site and the administrative costs for the district or 13.1 subdistrict have been received, after deducting the amount of 13.2 the state grant. 13.3 Sec. 5. Minnesota Statutes 1994, section 473.167, 13.4 subdivision 2, is amended to read: 13.5 Subd. 2. [LOANS FOR ACQUISITION.] The council may make 13.6 loans to counties, towns, and statutory and home rule charter 13.7 cities within the metropolitan area for the purchase of property 13.8 within the right-of-way of a state trunk highway shown on an 13.9 official map adopted pursuant to section 394.361 or 462.359 or 13.10 for the purchase of property within the proposed right-of-way of 13.11 a principal or intermediate arterial highway designated by the 13.12 council as a part of the metropolitan highway system plan and 13.13 approved by the council pursuant to subdivision 1. The loans 13.14 shall be made by the council, from the fund established pursuant 13.15 to this subdivision, for purchases approved by the council. The 13.16 loans shall bear no interest. The council shall make loans 13.17 only: (1) to accelerate the acquisition of primarily 13.18 undeveloped property when there is a reasonable probability that 13.19 the property will increase in value before highway construction, 13.20 and to update an expired environmental impact statement on a 13.21 project for which the right-of-way is being purchased; (2) to 13.22 avert the imminent conversion or the granting of approvals which 13.23 would allow the conversion of property to uses which would 13.24 jeopardize its availability for highway construction; or (3) to 13.25 advance planning and environmental activities on highest 13.26 priority major metropolitan river crossing projects, under the 13.27 transportation development guide chapter/policy plan. The 13.28 council shall not make loans for the purchase of property at a 13.29 price which exceeds the fair market value of the property or 13.30 which includes the costs of relocating or moving persons or 13.31 property. A private property owner may elect to receive the 13.32 purchase price either in a lump sum or in not more than four 13.33 annual installments without interest on the deferred 13.34 installments. If the purchase agreement provides for 13.35 installment payments, the council shall make the loan in 13.36 installments corresponding to those in the purchase agreement. 14.1 The recipient of an acquisition loan shall convey the property 14.2 for the construction of the highway at the same price which the 14.3 recipient paid for the property. The price may include the 14.4 costs of preparing environmental documents that were required 14.5 for the acquisition and that were paid for with money that the 14.6 recipient received from the loan fund. Upon notification by the 14.7 council that the plan to construct the highway has been 14.8 abandoned or the anticipated location of the highway changed, 14.9 the recipient shall sell the property at market value in 14.10 accordance with the procedures required for the disposition of 14.11 the property. All rents and other money received because of the 14.12 recipient's ownership of the property and all proceeds from the 14.13 conveyance or sale of the property shall be paid to the 14.14 council. If a recipient is not permitted to include in the 14.15 conveyance price the cost of preparing environmental documents 14.16 that were required for the acquisition, then the recipient is 14.17 not required to repay the council an amount equal to 40 percent 14.18 of the money received from the loan fund and spent in preparing 14.19 the environmental documents. The proceeds of the tax authorized 14.20 by subdivision 3 and distributed to the right-of-way acquisition 14.21 loan fund pursuant to subdivision 3a, paragraph (a), all money 14.22 paid to the council by recipients of loans, and all interest on 14.23 the proceeds and payments shall be maintained as a separate 14.24 fund. For administration of the loan program, the council may 14.25 expend from the fund each year an amount no greater than three 14.26 percent of the amount of theauthorized levyproceeds 14.27 distributed to the right-of-way acquisition loan fund pursuant 14.28 to subdivision 3a, paragraph (a), for that year. 14.29 Sec. 6. Minnesota Statutes 1994, section 473.167, 14.30 subdivision 3, is amended to read: 14.31 Subd. 3. [TAX.] The council may levy a tax on all taxable 14.32 property in the metropolitan area, as defined in section 14.33 473.121, to provide funds for loans made pursuant to 14.34 subdivisions 2 and 2a and for the tax base revitalization 14.35 account in the metropolitan livable communities fund, 14.36 established under section 473.251. This tax for the 15.1 right-of-way acquisition loan fund and the tax base 15.2 revitalization account shall be certified by the council, 15.3 levied, and collected in the manner provided by section 473.13. 15.4 The tax shall be in addition to that authorized by section 15.5 473.249 and any other law and shall not affect the amount or 15.6 rate of taxes which may be levied by the council or any 15.7 metropolitan agency or local governmental unit. The amount of 15.8 the levy shall be as determined and certified by the council,15.9except as otherwise provided in this subdivision. 15.10 The property tax levied by the metropolitan council for the 15.11 right-of-way acquisition loan fund and the tax base 15.12 revitalization account shall not exceed the following amount for 15.13 the years specified: 15.14 (a) for taxes payable in 1988, the product of 5/100 of one 15.15 mill multiplied by the total assessed valuation of all taxable 15.16 property located within the metropolitan area as adjusted by the 15.17 provisions of Minnesota Statutes 1986, sections 272.64; 273.13, 15.18 subdivision 7a; and 275.49; 15.19 (b) for taxes payable in 1989, except as provided in 15.20 section 473.249, subdivision 3, the product of (1) the 15.21 metropolitan council's property tax levy limitation for the 15.22 right-of-way acquisition loan fund for the taxes payable year 15.23 1988 determined under clause (a) multiplied by (2) an index for 15.24 market valuation changes equal to the assessment year 1988 total 15.25 market valuation of all taxable property located within the 15.26 metropolitan area divided by the assessment year 1987 total 15.27 market valuation of all taxable property located within the 15.28 metropolitan area; 15.29 (c) for taxes payable in 1990, an amount not to exceed 15.30 $2,700,000; and 15.31 (d) for taxes payable in 1991 and subsequent years, the 15.32 product of (1) the metropolitan council's property tax levy 15.33 limitation for the right-of-way acquisition loan fund for the 15.34 taxes payable in 1988 determined under clause (a) multiplied by 15.35 (2) an index for market valuation changes equal to the total 15.36 market valuation of all taxable property located within the 16.1 metropolitan area for the current taxes payable year divided by 16.2 the total market valuation of all taxable property located 16.3 within the metropolitan area for taxes payable in 1988. 16.4 For the purpose of determining the metropolitan council's 16.5 property tax levy limitation for the right-of-way acquisition 16.6 loan fund and tax base revitalization account in the 16.7 metropolitan livable communities fund, under section 473.251, 16.8 for the taxes payable year 1988 and subsequent years under this 16.9 subdivision, "total market valuation" means the total market 16.10 valuation of all taxable property within the metropolitan area 16.11 without valuation adjustments for fiscal disparities (chapter 16.12 473F), tax increment financing (sections 469.174 to 469.179), 16.13 and high voltage transmission lines (section 273.425). 16.14The property tax levied under this subdivision for taxes16.15payable in 1988 and subsequent years shall not be levied at a16.16rate higher than that determined by the metropolitan council to16.17be sufficient, considering the other anticipated revenues of and16.18disbursements from the right-of-way acquisition loan fund, to16.19produce a balance in the loan fund at the end of the next16.20calendar year equal to twice the amount of the property tax levy16.21limitation for taxes payable in the next calendar year16.22determined under this section.16.23 Sec. 7. Minnesota Statutes 1994, section 473.167, is 16.24 amended by adding a subdivision to read: 16.25 Subd. 3a. [DISTRIBUTION OF TAX PROCEEDS.] (a) Right-of-way 16.26 acquisition loan fund. Tax proceeds shall first be deposited 16.27 into the right-of-way acquisition loan fund in an amount 16.28 determined by the metropolitan council to be sufficient, 16.29 considering the other anticipated revenues of and disbursements 16.30 from the right-of-way acquisition loan fund, to produce a 16.31 balance in the loan fund at the end of the next calendar year 16.32 equal to twice the amount of the property tax levy limitation 16.33 for taxes payable in the next calendar year determined under 16.34 subdivision 3. 16.35 (b) Metropolitan livable communities tax base 16.36 revitalization account. Any tax proceeds not first deposited 17.1 into the right-of-way acquisition loan fund shall be distributed 17.2 to the tax base revitalization account in the metropolitan 17.3 livable communities fund, established under section 473.251. 17.4 Sec. 8. Minnesota Statutes 1994, section 473.704, 17.5 subdivision 18, is amended to read: 17.6 Subd. 18. The commission may establish a research program 17.7 to evaluate the effects of control programs on other fauna. The 17.8 purpose of the program is to identify the types and magnitude of 17.9 the adverse effects of the control program on fish and wildlife 17.10 and associated food chain invertebrates. The commission may 17.11 conduct research through contracts with qualified outside 17.12 researchers. The commission may finance the research program 17.13 each year at a level up to 2.5 percent of its annual budget, 17.14 until December 31, 1995. 17.15 Sec. 9. Minnesota Statutes 1994, section 473.711, 17.16 subdivision 2, is amended to read: 17.17 Subd. 2. [BUDGET; TAX LEVY.] (a) Budget. The metropolitan 17.18 mosquito control commission shall prepare an annual budget. The 17.19 budget may provide for expenditures in an amount not exceeding 17.20 the property tax levy limitation determined in this subdivision. 17.21 (b) Tax Levy. The commission may levy a tax on all taxable 17.22 property in the district as defined in section 473.702 to 17.23 provide funds for the purposes of sections 473.701 to 473.716. 17.24 The tax shall not exceed the property tax levy limitation 17.25 determined in this subdivision. A participating county may 17.26 agree to levy an additional tax to be used by the commission for 17.27 the purposes of sections 473.701 to 473.716 but the sum of the 17.28 county's and commission's taxes may not exceed the county's 17.29 proportionate share of the property tax levy limitation 17.30 determined under this subdivision based on the ratio of its 17.31 total net tax capacity to the total net tax capacity of the 17.32 entire district as adjusted by section 270.12, subdivision 3. 17.33 The auditor of each county in the district shall add the amount 17.34 of the levy made by the district to other taxes of the county 17.35 for collection by the county treasurer with other taxes. When 17.36 collected, the county treasurer shall make settlement of the tax 18.1 with the district in the same manner as other taxes are 18.2 distributed to political subdivisions. No county shall levy any 18.3 tax for mosquito, disease vectoring tick, and black gnat 18.4 (Simuliidae) control except undersections 473.701 to 473.71618.5 this section. The levy shall be in addition to other taxes 18.6 authorized by law. 18.7 The property tax levied by the metropolitan mosquito 18.8 control commission shall not exceed the following amount for the 18.9 years specified: 18.10 (i) for taxes payable in 1996, the product of (1) the 18.11 commission's property tax levy limitation forthe previous18.12yeartaxes payable in 1995 determined under this 18.13 subdivision minus 50 percent of the amount actually levied for 18.14 taxes payable in 1995, multiplied by (2) an index for market 18.15 valuation changes equal to the total market valuation of all 18.16 taxable property located within the district for the 18.17 currentassessmenttaxes payable year divided by the total 18.18 market valuation of all taxable property located within the 18.19 district for the previousassessmenttaxes payable year; and 18.20 (ii) for taxes payable in 1997 and subsequent years, the 18.21 product of (1) the commission's property tax levy limitation for 18.22 the previous year determined under this subdivision multiplied 18.23 by (2) an index for market valuation changes equal to the total 18.24 market valuation of all taxable property located within the 18.25 district for the current taxes payable year divided by the total 18.26 market valuation of all taxable property located within the 18.27 district for the previous taxes payable year. 18.28 For the purpose of determining the commission's property 18.29 tax levy limitation under this subdivision, "total market 18.30 valuation" means the total market valuation of all taxable 18.31 property within the district without valuation adjustments for 18.32 fiscal disparities (chapter 473F), tax increment financing 18.33 (sections 469.174 to 469.179), and high voltage transmission 18.34 lines (section 273.425). 18.35 (c) Homestead and Agricultural Credit Aid. For aids 18.36 payable in 1996 and subsequent years, the commission's homestead 19.1 and agricultural credit aid base under section 273.1398, 19.2 subdivision 1, is permanently reduced by 50 percent of the 19.3 amount certified to be received in 1995, less any permanent aid 19.4 reduction in 1995 under section 477A.0132. 19.5 (d) Emergency Tax Levy. If the commissioner of the 19.6 department of health declares a health emergency due to a 19.7 threatened or actual outbreak of disease caused by mosquitos, 19.8 disease vectoring ticks, or black gnats (Simuliidae), the 19.9 commission may levy an additional tax not to exceed $500,000 on 19.10 all taxable property in the district to pay for the required 19.11 control measures. 19.12 (e) Optional County Levy. A participating county may levy 19.13 a tax in an amount to be determined by the county board for 19.14 mosquito, disease vectoring tick, and black gnat (Simuliidae) 19.15 nuisance control. If the county levies the tax for nuisance 19.16 control, it must contract with the commission to provide for 19.17 nuisance control activities within the county. The levy for 19.18 nuisance control shall be in addition to other levies authorized 19.19 by law to the county. 19.20 Sec. 10. Minnesota Statutes 1994, section 473F.08, 19.21 subdivision 3a, is amended to read: 19.22 Subd. 3a. Beginning in 1987 and each subsequent year 19.23 through 1998, the city of Bloomington shall determine the 19.24 interest payments for that year for the bonds which have been 19.25 sold for the highway improvements pursuant to Laws 1986, chapter 19.26 391, section 2, paragraph (g). Effective for property taxes 19.27 payable in 1988 through property taxes payable in 1999, after 19.28 the Hennepin county auditor has computed the areawide portion of 19.29 the levy for the city of Bloomington pursuant to subdivision 3, 19.30 clause (a), the auditor shall annually add a dollar amount to 19.31 the city of Bloomington's areawide portion of the levy equal to 19.32 the amount which has been certified to the auditor by the city 19.33 of Bloomington for the interest payments for that year for the 19.34 bonds which were sold for highway improvements. The total 19.35 areawide portion of the levy for the city of Bloomington 19.36 including the additional amount for interest repayment certified 20.1 pursuant to this subdivision shall be certified by the Hennepin 20.2 county auditor to the administrative auditor pursuant to 20.3 subdivision 5. The Hennepin county auditor shall distribute to 20.4 the city of Bloomington the additional areawide portion of the 20.5 levy computed pursuant to this subdivision at the same time that 20.6 payments are made to the other counties pursuant to subdivision 20.7 7a. For property taxes payable from the year20002006 through 20.820092015, the Hennepin county auditor shall adjust 20.9 Bloomington's contribution to the areawide gross tax capacity 20.10 upward each year by a value equal to ten percent of the total 20.11 additional areawide levy distributed to Bloomington under this 20.12 subdivision from 1988 to 1999, divided by the areawide tax rate 20.13 for taxes payable in the previous year. 20.14 Sec. 11. Minnesota Statutes 1994, section 473F.08, is 20.15 amended by adding a subdivision to read: 20.16 Subd. 3b. [LIVABLE COMMUNITIES FUND.] (a) The Hennepin 20.17 county auditor shall certify the city of Bloomington's interest 20.18 payments for 1987 for the bonds which were sold for highway 20.19 improvements pursuant to Laws 1986, chapter 391, section 2, 20.20 paragraph (g), and which were certified as an addition to the 20.21 city of Bloomington's areawide levy for taxes payable in 1988. 20.22 (b) For taxes payable in 1996 through taxes payable in 20.23 1999, the Hennepin county auditor shall certify the amount 20.24 calculated by subtracting the amount certified under subdivision 20.25 3a from the amount in paragraph (a). For taxes payable in 2000 20.26 and subsequent years, the Hennepin county auditor shall certify 20.27 the amount calculated in paragraph (a). 20.28 (c) The metropolitan council may annually certify to the 20.29 Ramsey county auditor the amount calculated under paragraph (b), 20.30 or a lesser amount, but not to exceed $5,000,000, to be used to 20.31 provide funds for the cleanup of polluted lands in the 20.32 metropolitan area. 20.33 (d) The amount certified under paragraph (c) shall be 20.34 certified annually by the Ramsey county auditor to the 20.35 administrative auditor as an addition to the metropolitan 20.36 council's areawide levy under subdivision 5. 21.1 Sec. 12. Minnesota Statutes 1994, section 473F.08, 21.2 subdivision 5, is amended to read: 21.3 Subd. 5. [AREAWIDE TAX RATE.] On or before August 25 of 21.4 each year, the county auditor shall certify to the 21.5 administrative auditor that portion of the levy of each 21.6 governmental unit determined undersubdivisionsubdivisions 3, 21.7 clause (a), 3a, and 3b. The administrative auditor shall then 21.8 determine the areawide tax rate sufficient to yield an amount 21.9 equal to the sum of such levies from the areawide net tax 21.10 capacity. On or before September 1 of each year, the 21.11 administrative auditor shall certify the areawide tax rate to 21.12 each of the county auditors. 21.13 Sec. 13. Minnesota Statutes 1994, section 473F.08, 21.14 subdivision 7a, is amended to read: 21.15 Subd. 7a. [CERTIFICATION OF VALUES; PAYMENT.] The 21.16 administrative auditor shall determine for each county the 21.17 difference between the total levy on distribution value pursuant 21.18 tosubdivisionsubdivisions 3, clause (a), 3a, and 3b, within 21.19 the county and the total tax on contribution value pursuant to 21.20 subdivision 6, within the county. On or before May 16 of each 21.21 year, the administrative auditor shall certify the differences 21.22 so determined to each county auditor. In addition, the 21.23 administrative auditor shall certify to those county auditors 21.24 for whose county the total tax on contribution value exceeds the 21.25 total levy on distribution value the settlement the county is to 21.26 make to the other counties of the excess of the total tax on 21.27 contribution value over the total levy on distribution value in 21.28 the county. On or before June 15 and November 15 of each year, 21.29 each county treasurer in a county having a total tax on 21.30 contribution value in excess of the total levy on distribution 21.31 value shall pay one-half of the excess to the other counties in 21.32 accordance with the administrative auditors certification. 21.33 Sec. 14. [MOSQUITO CONTROL COMMISSION EMPLOYEES.] 21.34 Employees of the metropolitan mosquito control commission 21.35 covered under the terms of a collective bargaining agreement as 21.36 of March 1, 1995, may not be terminated by discharge, except for 22.1 cause, before January 1, 1999. This act does not abrogate or 22.2 change any rights enjoyed by the employees of the commission 22.3 under the terms of a collective bargaining agreement that is in 22.4 effect on March 1, 1995. 22.5 Sec. 15. [AMENDMENT OF GRANT APPLICATIONS.] 22.6 A development authority that, before the effective date of 22.7 this section, submitted an application for a grant under 22.8 Minnesota Statutes, sections 116J.551 to 116J.558, may, before 22.9 the next application deadline, submit to the commissioner of 22.10 trade and economic development an amended application based on 22.11 the changes made by section 1. 22.12 Sec. 16. [ECONOMIC VITALITY AND HOUSING INITIATIVE.] 22.13 Subdivision 1. [ESTABLISHMENT.] The Minnesota housing 22.14 finance agency may establish an economic vitality and housing 22.15 initiative to provide funds for affordable housing projects in 22.16 connection with local communities' economic development and 22.17 redevelopment efforts. The purpose of the economic vitality and 22.18 housing initiative is to provide resources for affordable 22.19 housing in communities throughout the state necessary to ensure 22.20 the expansion and preservation of the economic base and 22.21 employment opportunities. The agency must use the economic 22.22 vitality and housing initiative to leverage to the extent 22.23 possible private and other public funds for the purpose of this 22.24 section. 22.25 Subd. 2. [GREATER MINNESOTA.] In Greater Minnesota, which 22.26 is defined for this section as the area of the state not 22.27 included in subdivision 3, the agency must work with groups in 22.28 the McKnight initiative fund regions to assist the agency in 22.29 identifying the affordable housing needed in each region in 22.30 connection with economic development and redevelopment efforts 22.31 and in establishing priorities for uses of economic vitality and 22.32 housing funds. The groups must include the McKnight initiative 22.33 funds, the regional development commissions, the private 22.34 industry councils, units of local government, community action 22.35 agencies, the Minnesota housing partnership network groups, 22.36 local lenders, for-profit and nonprofit developers, and 23.1 realtors. In addition to priorities developed by the group, the 23.2 agency must give a preference to viable projects in which area 23.3 employers contribute financial assistance. 23.4 Subd. 3. [METROPOLITAN AREA.] In the metropolitan area, as 23.5 defined in Minnesota Statutes, section 473.121, subdivision 2, 23.6 the agency must confer with the metropolitan council to identify 23.7 the priorities for use of the economic vitality and housing 23.8 funds. The agency shall give preference to economically viable 23.9 projects that: 23.10 (1) include a contribution of financial resources from 23.11 units of local government and area employers; 23.12 (2) are located in areas accessible to public 23.13 transportation or served by transportation programs or along 23.14 arterial roadways; 23.15 (3) take into account the availability of job training 23.16 efforts in the community; and 23.17 (4) address local and regional objectives for the 23.18 development of affordable and life cycle housing and the 23.19 redevelopment of neighborhoods and communities. 23.20 Subd. 4. [EXPIRATION.] This section expires June 30, 1997. 23.21 Sec. 17. [REPEALER.] 23.22 Minnesota Statutes 1994, sections 504.33; 504.34; and 23.23 504.35, are repealed. 23.24 Sec. 18. [CITATION.] 23.25 This act may be cited as "the metropolitan livable 23.26 communities act." 23.27 Sec. 19. [APPLICATION.] 23.28 This article applies in the counties of Anoka, Carver, 23.29 Dakota, Hennepin, Ramsey, Scott, and Washington. 23.30 Sec. 20. [EFFECTIVE DATES.] 23.31 This article is effective the day after final enactment. 23.32 Sections 6, 9, and 11 to 13 are effective for taxes levied in 23.33 1995, payable in 1996 and subsequent years. 23.34 ARTICLE 3 23.35 HOUSING 23.36 Section 1. Minnesota Statutes 1994, section 290.01, 24.1 subdivision 19b, is amended to read: 24.2 Subd. 19b. [SUBTRACTIONS FROM FEDERAL TAXABLE INCOME.] For 24.3 individuals, estates, and trusts, there shall be subtracted from 24.4 federal taxable income: 24.5 (1) interest income on obligations of any authority, 24.6 commission, or instrumentality of the United States to the 24.7 extent includable in taxable income for federal income tax 24.8 purposes but exempt from state income tax under the laws of the 24.9 United States; 24.10 (2) if included in federal taxable income, the amount of 24.11 any overpayment of income tax to Minnesota or to any other 24.12 state, for any previous taxable year, whether the amount is 24.13 received as a refund or as a credit to another taxable year's 24.14 income tax liability; 24.15 (3) the amount paid to others not to exceed $650 for each 24.16 dependent in grades kindergarten to 6 and $1,000 for each 24.17 dependent in grades 7 to 12, for tuition, textbooks, and 24.18 transportation of each dependent in attending an elementary or 24.19 secondary school situated in Minnesota, North Dakota, South 24.20 Dakota, Iowa, or Wisconsin, wherein a resident of this state may 24.21 legally fulfill the state's compulsory attendance laws, which is 24.22 not operated for profit, and which adheres to the provisions of 24.23 the Civil Rights Act of 1964 and chapter 363. As used in this 24.24 clause, "textbooks" includes books and other instructional 24.25 materials and equipment used in elementary and secondary schools 24.26 in teaching only those subjects legally and commonly taught in 24.27 public elementary and secondary schools in this state. 24.28 "Textbooks" does not include instructional books and materials 24.29 used in the teaching of religious tenets, doctrines, or worship, 24.30 the purpose of which is to instill such tenets, doctrines, or 24.31 worship, nor does it include books or materials for, or 24.32 transportation to, extracurricular activities including sporting 24.33 events, musical or dramatic events, speech activities, driver's 24.34 education, or similar programs. In order to qualify for the 24.35 subtraction under this clause the taxpayer must elect to itemize 24.36 deductions under section 63(e) of the Internal Revenue Code; 25.1 (4) to the extent included in federal taxable income, 25.2 distributions from a qualified governmental pension plan, an 25.3 individual retirement account, simplified employee pension, or 25.4 qualified plan covering a self-employed person that represent a 25.5 return of contributions that were included in Minnesota gross 25.6 income in the taxable year for which the contributions were made 25.7 but were deducted or were not included in the computation of 25.8 federal adjusted gross income. The distribution shall be 25.9 allocated first to return of contributions until the 25.10 contributions included in Minnesota gross income have been 25.11 exhausted. This subtraction applies only to contributions made 25.12 in a taxable year prior to 1985; 25.13 (5) income as provided under section 290.0802; 25.14 (6) the amount of unrecovered accelerated cost recovery 25.15 system deductions allowed under subdivision 19g; 25.16 (7) to the extent included in federal adjusted gross 25.17 income, income realized on disposition of property exempt from 25.18 tax under section 290.491;and25.19 (8) to the extent not deducted in determining federal 25.20 taxable income, the amount paid for health insurance of 25.21 self-employed individuals as determined under section 162(l) of 25.22 the Internal Revenue Code, except that the 25 percent limit does 25.23 not apply. If the taxpayer deducted insurance payments under 25.24 section 213 of the Internal Revenue Code of 1986, the 25.25 subtraction under this clause must be reduced by the lesser of: 25.26 (i) the total itemized deductions allowed under section 25.27 63(d) of the Internal Revenue Code, less state, local, and 25.28 foreign income taxes deductible under section 164 of the 25.29 Internal Revenue Code and the standard deduction under section 25.30 63(c) of the Internal Revenue Code; or 25.31 (ii) the lesser of (A) the amount of insurance qualifying 25.32 as "medical care" under section 213(d) of the Internal Revenue 25.33 Code to the extent not deducted under section 162(1) of the 25.34 Internal Revenue Code or excluded from income or (B) the total 25.35 amount deductible for medical care under section 213(a); and 25.36 (9) the exemption amount allowed under section 2, 26.1 subdivision 3. 26.2 Sec. 2. [URBAN HOMESTEADING PROGRAM.] 26.3 Subdivision 1. [URBAN REVITALIZATION AND STABILIZATION 26.4 ZONES.] By September 1, 1995, the metropolitan council shall 26.5 designate one or more urban revitalization and stabilization 26.6 zones in the metropolitan area, as defined in section 473.121, 26.7 subdivision 2. The designated zones must contain no more than 26.8 1,000 single family homes in total. In designating urban 26.9 revitalization and stabilization zones, the council shall choose 26.10 areas that are in transition toward blight and poverty. The 26.11 council shall use indicators that evidence increasing 26.12 neighborhood distress such as declining residential property 26.13 values, declining resident incomes, declining rates of 26.14 owner-occupancy, and other indicators of blight and poverty in 26.15 determining which areas are to be urban revitalization and 26.16 stabilization zones. 26.17 Subd. 2. [PROGRAM ELIGIBILITY.] Any person buying and 26.18 occupying a home within the boundaries of an urban 26.19 revitalization and stabilization zone after September 1, 1995, 26.20 is eligible to participate in the urban homesteading program. 26.21 An owner may participate by filing an annual application with 26.22 the county assessor of the county in which the homestead is 26.23 located. On or before January 15 of the second year after the 26.24 initial application and for a total of four subsequent years in 26.25 which the owner continues to meet eligibility requirements under 26.26 this subdivision, the assessor shall provide written 26.27 verification that the homestead is within an urban 26.28 revitalization and stabilization zone to the owner in a form and 26.29 manner prescribed by the commissioner of revenue. The form 26.30 shall include the date on which the owner purchased the 26.31 property, the date on which the owner applied for the urban 26.32 homesteading program, and shall indicate if the property has 26.33 been found to be not in compliance with applicable building 26.34 codes, and the dates of inspections. The assessor may charge a 26.35 fee to the owner, not to exceed $10 per year, for the costs of 26.36 processing the application. An owner shall become ineligible 27.1 for the program if any of the following occurs: 27.2 (1) the property is sold or otherwise transferred to 27.3 another party; 27.4 (2) the property is found not to be in compliance with 27.5 applicable building codes, provided that at least three years 27.6 have passed since the owner filed for participation in the 27.7 program; 27.8 (3) the owner ceases to occupy the property; or 27.9 (4) any of the owners of the property are convicted of 27.10 violating Minnesota Statutes, sections 152.021 to 152.025 or 27.11 152.0261, or committing any other felony-level violation. 27.12 The county assessor shall annually provide to the county 27.13 attorney a list of the owners of property within the county who 27.14 are currently in the program. The county attorney shall notify 27.15 the assessor if any of the owners participating in the program 27.16 have been convicted of violating a felony-level crime after the 27.17 date on which they began participation in the program. The 27.18 assessor shall notify the owners, by first class mail, of the 27.19 loss of their eligibility of participation in the program for 27.20 the following year and any subsequent years. The assessor shall 27.21 at the same time notify the commissioner of revenue of the 27.22 owners' loss of eligibility. The owners may appeal the loss of 27.23 eligibility to the tax court, but the appeal is limited to the 27.24 factual question of whether the disqualifying event has actually 27.25 occurred. 27.26 Subd. 3. [TAX BENEFITS.] Individuals participating in the 27.27 urban homesteading program shall receive an exemption from 27.28 Minnesota taxable income for each full tax year during which 27.29 eligibility under subdivision 2 is mandated, beginning in the 27.30 first full tax year following the filing of an application with 27.31 the county assessor. Eligibility may continue for a maximum of 27.32 five years, provided that the individual does not become 27.33 ineligible for the program under subdivision 2. The maximum 27.34 exemption amount shall equal $15,000 for married individuals 27.35 filing joint returns and surviving spouses as defined in section 27.36 2(a) of the Internal Revenue Code, $10,000 for unmarried 28.1 individuals, and $12,500 for unmarried individuals qualifying as 28.2 a head of household as defined in section 2(b) of the Internal 28.3 Revenue Code. The maximum exemption amount shall be reduced by 28.4 two percent of the maximum exemption amount for each $1,000 of 28.5 adjusted gross income or part thereof above an income 28.6 threshold. For purposes of this subdivision, adjusted gross 28.7 income means federal adjusted gross income as defined in section 28.8 62 of the Internal Revenue Code. The income threshold shall 28.9 equal $60,000 for married individuals filing joint returns and 28.10 surviving spouses, $40,000 for unmarried individuals, and 28.11 $50,000 for unmarried individuals qualifying as a head of 28.12 household. Participants shall claim the exemption by filing the 28.13 form provided under subdivision 2 with the income tax return 28.14 filed under chapter 290. 28.15 Subd. 4. [EXPIRATION.] Initial applications for the urban 28.16 homesteading program shall not be accepted after July 1, 1997. 28.17 Subd. 5. [INFORMATION TO POTENTIAL BUYERS.] The 28.18 metropolitan council shall market and promote the urban 28.19 homestead program to the extent feasible, but such efforts shall 28.20 at least include informing area realtors or realtor associations 28.21 about the program. 28.22 Subd. 6. [REPORTS.] The metropolitan council shall make an 28.23 initial report to the legislature by January 1, 1998, on the 28.24 urban homesteading program. The initial report shall contain 28.25 information on designation of zones, participation rates, and 28.26 current and projected future costs of providing state income tax 28.27 exemptions to program participants. 28.28 The metropolitan council shall make full reports to the 28.29 legislature by January 1, 2000, and January 1, 2003, on the 28.30 urban homesteading program. The full reports shall include 28.31 information on those subjects covered by the initial report, as 28.32 well as information on neighborhood impacts, property values, 28.33 resident incomes, rates of owner-occupancy, and other indicators 28.34 of poverty and blight. 28.35 Sec. 3. [APPLICATION.] 28.36 Section 2 applies in the counties of Anoka, Carver, Dakota, 29.1 Hennepin, Ramsey, Scott, and Washington. 29.2 Sec. 4. [EFFECTIVE DATE.] 29.3 Section 1 is effective for tax years beginning after 29.4 December 31, 1995.