SF 1123

1st Engrossment - 79th Legislature (1995 - 1996) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act
  1.2             relating to taxation; adopting federal income tax law 
  1.3             changes; modifying certain sales and excise tax rates, 
  1.4             bases, and exemptions; modifying provisions relating 
  1.5             to local excise taxes; restricting property tax 
  1.6             levies; modifying certain duties imposed on local 
  1.7             units of government and the department of revenue; 
  1.8             modifying property tax exemption, valuation, and 
  1.9             classification provisions; adjusting certain state aid 
  1.10            distribution provisions; providing for deduction of 
  1.11            property tax refunds from property taxes; authorizing 
  1.12            certain exceptions to tax increment financing 
  1.13            provisions; providing for establishment of special 
  1.14            service districts; authorizing issuance of bonds and 
  1.15            tax anticipation certificates; modifying certain 
  1.16            taconite occupation and production provisions; 
  1.17            adjusting the amount of the budget reserve; modifying 
  1.18            the duties of the board of government innovation and 
  1.19            cooperation; appropriating money; amending Minnesota 
  1.20            Statutes 1994, sections 6.745, subdivision 1; 16A.152, 
  1.21            subdivision 1; 116J.556; 134.34, subdivision 4a; 
  1.22            216B.16, by adding a subdivision; 216C.01, 
  1.23            subdivisions 1a and 1b; 246.18, subdivision 4, and by 
  1.24            adding subdivisions; 254B.02, subdivision 3; 256H.09, 
  1.25            subdivision 3; 270A.03, subdivision 7; 270A.08, 
  1.26            subdivision 1; 270B.12, by adding subdivisions; 
  1.27            272.02, subdivision 1; 273.11, subdivision 16; 
  1.28            273.124, subdivisions 1 and 13; 273.13, subdivisions 
  1.29            24 and 25; 273.1399, subdivision 6, and by adding a 
  1.30            subdivision; 273.37, by adding a subdivision; 274.01, 
  1.31            subdivision 1; 275.065, subdivision 3; 276.04, 
  1.32            subdivision 2; 276.09; 276.111; 276.131; 279.01, 
  1.33            subdivision 1, and by adding a subdivision; 279.09; 
  1.34            279.10; 281.23, subdivision 3; 289A.60, subdivision 
  1.35            12; 290.01, subdivision 19; 290A.03, subdivision 13; 
  1.36            290A.04, subdivision 2h; 290A.07; 290A.15; 290A.18; 
  1.37            296.01, subdivisions 30, 34, and by adding 
  1.38            subdivisions; 296.02, subdivisions 1, 1a, and 1b; 
  1.39            296.025, subdivisions 1, 1a, and by adding a 
  1.40            subdivision; 296.0261, by adding a subdivision; 
  1.41            297A.01, subdivision 3, and by adding a subdivision; 
  1.42            297A.135, subdivision 1; 297A.15, by adding a 
  1.43            subdivision; 297A.25, subdivisions 9, 11, and 59; 
  1.44            297A.45; 298.01, subdivision 4; 298.227; 298.24, 
  1.45            subdivision 1; 298.25; 298.28, subdivision 9a; 
  1.46            298.296, subdivision 4; 349A.10, subdivision 5; 
  2.1             375.169; 375.83; 465.798; 465.799; 465.801; 465.81, 
  2.2             subdivision 1; 465.82, subdivision 2; 465.84; 465.85; 
  2.3             465.87; 469.169, subdivision 9, and by adding a 
  2.4             subdivision; 471.6965; 477A.011, subdivision 36; Laws 
  2.5             1986, chapter 400, section 44; Laws 1991, chapter 291, 
  2.6             article 8, section 28, subdivision 1; Laws 1992, 
  2.7             chapter 511, article 2, sections 45, subdivision 7, 
  2.8             and by adding a subdivision; and 46, subdivision 7, 
  2.9             and by adding a subdivision; proposing coding for new 
  2.10            law in Minnesota Statutes, chapters 13; 16A; 270; 276; 
  2.11            290A; 297A; 410; 465; 473; repealing Minnesota 
  2.12            Statutes 1994, sections 124.01; 124.05; 124.06; 
  2.13            124.07; 124.76; 124.82; 124.829; 124.83; 124.84; 
  2.14            124.85; 124.86; 124.90; 124.91; 124.912; 124.914; 
  2.15            124.916; 124.918; 124.95; 124.961; 124.962; 124.97; 
  2.16            124A.02, subdivisions 16, 23, and 24; 124A.03, 
  2.17            subdivisions 1b, 1c, 1d, 1e, 1f, 1g, 1h, and 1i; 
  2.18            124A.0311; 124A.032; 124A.04; 124A.22, subdivisions 1, 
  2.19            2, 3, 4, 4a, 4b, 6, 6a, 8, and 9; 124A.23; 124A.24; 
  2.20            124A.26, subdivisions 1, 2, and 3; 124A.27; 124A.28; 
  2.21            124A.29, subdivision 2; 245.48; 256H.12, subdivision 
  2.22            3; 273.13; 273.135; 273.136; 273.1391; 273.1399; 
  2.23            296.0261; 297A.136; 469.175, subdivision 7a; 473F.001; 
  2.24            473F.01; 473F.02; 473F.03; 473F.05; 473F.06; 473F.07; 
  2.25            473F.08; 473F.09; 473F.10; 473F.11; 473F.13; 477A.011; 
  2.26            477A.012; 477A.0121; 477A.0122; 477A.013; 477A.0132; 
  2.27            477A.014; 477A.015; 477A.016; 477A.017; 477A.03; 
  2.28            477A.11; 477A.12; 477A.13; 477A.14; 477A.15; Laws 
  2.29            1991, chapter 265, article 7, section 35. 
  2.30  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  2.31                             ARTICLE 1
  2.32                           FEDERAL UPDATE
  2.33     Section 1.  Minnesota Statutes 1994, section 290.01, 
  2.34  subdivision 19, is amended to read: 
  2.35     Subd. 19.  [NET INCOME.] The term "net income" means the 
  2.36  federal taxable income, as defined in section 63 of the Internal 
  2.37  Revenue Code of 1986, as amended through the date named in this 
  2.38  subdivision, incorporating any elections made by the taxpayer in 
  2.39  accordance with the Internal Revenue Code in determining federal 
  2.40  taxable income for federal income tax purposes, and with the 
  2.41  modifications provided in subdivisions 19a to 19f. 
  2.42     In the case of a regulated investment company or a fund 
  2.43  thereof, as defined in section 851(a) or 851(h) of the Internal 
  2.44  Revenue Code, federal taxable income means investment company 
  2.45  taxable income as defined in section 852(b)(2) of the Internal 
  2.46  Revenue Code, except that:  
  2.47     (1) the exclusion of net capital gain provided in section 
  2.48  852(b)(2)(A) of the Internal Revenue Code does not apply; and 
  2.49     (2) the deduction for dividends paid under section 
  2.50  852(b)(2)(D) of the Internal Revenue Code must be applied by 
  3.1   allowing a deduction for capital gain dividends and 
  3.2   exempt-interest dividends as defined in sections 852(b)(3)(C) 
  3.3   and 852(b)(5) of the Internal Revenue Code.  
  3.4      The net income of a real estate investment trust as defined 
  3.5   and limited by section 856(a), (b), and (c) of the Internal 
  3.6   Revenue Code means the real estate investment trust taxable 
  3.7   income as defined in section 857(b)(2) of the Internal Revenue 
  3.8   Code.  
  3.9      The net income of a designated settlement fund as defined 
  3.10  in section 468B(d) of the Internal Revenue Code means the gross 
  3.11  income as defined in section 468B(b) of the Internal Revenue 
  3.12  Code. 
  3.13     The Internal Revenue Code of 1986, as amended through 
  3.14  December 31, 1986, shall be in effect for taxable years 
  3.15  beginning after December 31, 1986.  The provisions of sections 
  3.16  10104, 10202, 10203, 10204, 10206, 10212, 10221, 10222, 10223, 
  3.17  10226, 10227, 10228, 10611, 10631, 10632, and 10711 of the 
  3.18  Omnibus Budget Reconciliation Act of 1987, Public Law Number 
  3.19  100-203, the provisions of sections 1001, 1002, 1003, 1004, 
  3.20  1005, 1006, 1008, 1009, 1010, 1011, 1011A, 1011B, 1012, 1013, 
  3.21  1014, 1015, 1018, 2004, 3041, 4009, 6007, 6026, 6032, 6137, 
  3.22  6277, and 6282 of the Technical and Miscellaneous Revenue Act of 
  3.23  1988, Public Law Number 100-647, and the provisions of sections 
  3.24  7811, 7816, and 7831 of the Omnibus Budget Reconciliation Act of 
  3.25  1989, Public Law Number 101-239, shall be effective at the time 
  3.26  they become effective for federal income tax purposes.  
  3.27     The Internal Revenue Code of 1986, as amended through 
  3.28  December 31, 1987, shall be in effect for taxable years 
  3.29  beginning after December 31, 1987.  The provisions of sections 
  3.30  4001, 4002, 4011, 5021, 5041, 5053, 5075, 6003, 6008, 6011, 
  3.31  6030, 6031, 6033, 6057, 6064, 6066, 6079, 6130, 6176, 6180, 
  3.32  6182, 6280, and 6281 of the Technical and Miscellaneous Revenue 
  3.33  Act of 1988, Public Law Number 100-647, the provisions of 
  3.34  sections 7815 and 7821 of the Omnibus Budget Reconciliation Act 
  3.35  of 1989, Public Law Number 101-239, and the provisions of 
  3.36  section 11702 of the Revenue Reconciliation Act of 1990, Public 
  4.1   Law Number 101-508, shall become effective at the time they 
  4.2   become effective for federal tax purposes.  
  4.3      The Internal Revenue Code of 1986, as amended through 
  4.4   December 31, 1988, shall be in effect for taxable years 
  4.5   beginning after December 31, 1988.  The provisions of sections 
  4.6   7101, 7102, 7104, 7105, 7201, 7202, 7203, 7204, 7205, 7206, 
  4.7   7207, 7210, 7211, 7301, 7302, 7303, 7304, 7601, 7621, 7622, 
  4.8   7641, 7642, 7645, 7647, 7651, and 7652 of the Omnibus Budget 
  4.9   Reconciliation Act of 1989, Public Law Number 101-239, the 
  4.10  provision of section 1401 of the Financial Institutions Reform, 
  4.11  Recovery, and Enforcement Act of 1989, Public Law Number 101-73, 
  4.12  and the provisions of sections 11701 and 11703 of the Revenue 
  4.13  Reconciliation Act of 1990, Public Law Number 101-508, shall 
  4.14  become effective at the time they become effective for federal 
  4.15  tax purposes.  
  4.16     The Internal Revenue Code of 1986, as amended through 
  4.17  December 31, 1989, shall be in effect for taxable years 
  4.18  beginning after December 31, 1989.  The provisions of sections 
  4.19  11321, 11322, 11324, 11325, 11403, 11404, 11410, and 11521 of 
  4.20  the Revenue Reconciliation Act of 1990, Public Law Number 
  4.21  101-508, and the provisions of sections 13224 and 13261 of the 
  4.22  Omnibus Budget Reconciliation Act of 1993, Public Law Number 
  4.23  103-66, shall become effective at the time they become effective 
  4.24  for federal purposes.  
  4.25     The Internal Revenue Code of 1986, as amended through 
  4.26  December 31, 1990, shall be in effect for taxable years 
  4.27  beginning after December 31, 1990. 
  4.28     The provisions of section 13431 of the Omnibus Budget 
  4.29  Reconciliation Act of 1993, Public Law Number 103-66, shall 
  4.30  become effective at the time they became effective for federal 
  4.31  purposes.  
  4.32     The Internal Revenue Code of 1986, as amended through 
  4.33  December 31, 1991, shall be in effect for taxable years 
  4.34  beginning after December 31, 1991.  
  4.35     The provisions of sections 1936 and 1937 of the 
  4.36  Comprehensive National Energy Policy Act of 1992, Public Law 
  5.1   Number 102-486, and the provisions of sections 13101, 13114, 
  5.2   13122, 13141, 13150, 13151, 13174, 13239, 13301, and 13442 of 
  5.3   the Omnibus Budget Reconciliation Act of 1993, Public Law Number 
  5.4   103-66, shall become effective at the time they become effective 
  5.5   for federal purposes.  
  5.6      The Internal Revenue Code of 1986, as amended through 
  5.7   December 31, 1992, shall be in effect for taxable years 
  5.8   beginning after December 31, 1992.  
  5.9      The provisions of sections 13116, 13121, 13206, 13210, 
  5.10  13222, 13223, 13231, 13232, 13233, 13239, 13262, and 13321 of 
  5.11  the Omnibus Budget Reconciliation Act of 1993, Public Law Number 
  5.12  103-66, shall become effective at the time they become effective 
  5.13  for federal purposes. 
  5.14     The Internal Revenue Code of 1986, as amended through 
  5.15  December 31, 1993, shall be in effect for taxable years 
  5.16  beginning after December 31, 1993. 
  5.17     The provision of section 741 of Legislation to Implement 
  5.18  Uruguay Round of General Agreement on Tariffs and Trade, Public 
  5.19  Law Number 103-465, and the provisions of sections 1, 2, and 3, 
  5.20  of the Self-Employed Health Insurance Act of 1995, Public Law 
  5.21  Number 104-... shall become effective at the time they become 
  5.22  effective for federal purposes. 
  5.23     The Internal Revenue Code of 1986, as amended through 
  5.24  December 31, 1994, shall be in effect for taxable years 
  5.25  beginning after December 31, 1994. 
  5.26     Except as otherwise provided, references to the Internal 
  5.27  Revenue Code in subdivisions 19a to 19g mean the code in effect 
  5.28  for purposes of determining net income for the applicable year. 
  5.29     Sec. 2.  [FEDERAL CHANGES.] 
  5.30     The changes made by sections 721, 722, 723, and 744 of 
  5.31  Legislation to Implement Uruguay Round of General Agreement on 
  5.32  Tariffs and Trade, Public Law Number 103-465 and section 4 of 
  5.33  the Self-Employed Health Insurance Act of 1995, Public Law 
  5.34  Number 104-..., which affect the computation of the Minnesota 
  5.35  working family credit under Minnesota Statutes, section 
  5.36  290.0671, subdivision 1, and the computation of the substantial 
  6.1   understatement of liability penalty of Minnesota Statutes, 
  6.2   section 289A.60, subdivision 4, shall become effective at the 
  6.3   same time the changes become effective for federal purposes. 
  6.4      Sec. 3.  [INSTRUCTION TO REVISOR.] 
  6.5      In the next edition of Minnesota Statutes, the revisor of 
  6.6   statutes shall substitute the phrase "Internal Revenue Code of 
  6.7   1986, as amended through April 15, 1995," for the words 
  6.8   "Internal Revenue Code of 1986, as amended through December 31, 
  6.9   1993," wherever the phrase occurs in chapters 289A, 290, 290A, 
  6.10  291, 297, 298, and 469, except section 290.01, subdivision 19. 
  6.11                             ARTICLE 2
  6.12                       SALES AND EXCISE TAXES
  6.13     Section 1.  Minnesota Statutes 1994, section 216C.01, 
  6.14  subdivision 1a, is amended to read: 
  6.15     Subd. 1a.  [ALTERNATIVE FUEL.] "Alternative fuel" means 
  6.16  natural gas; liquefied petroleum gas; hydrogen; coal-derived 
  6.17  liquefied fuels; electricity; methanol, denatured ethanol, and 
  6.18  other alcohols; mixtures containing 85 percent or more, or other 
  6.19  percentage as may be set by regulation by the Secretary of the 
  6.20  United States Department of Energy, by volume of methanol, 
  6.21  denatured ethanol, and other alcohols with gasoline or other 
  6.22  fuels; fuels other than alcohol that are derived from biological 
  6.23  materials; and other fuel that the Secretary of the United 
  6.24  States Department of Energy determines by regulation to be an 
  6.25  alternative fuel within the meaning of section 301(2) of the 
  6.26  National Energy Policy Act of 1992 and intended for use in motor 
  6.27  vehicles. 
  6.28     Sec. 2.  Minnesota Statutes 1994, section 216C.01, 
  6.29  subdivision 1b, is amended to read: 
  6.30     Subd. 1b.  [ALTERNATIVE FUEL VEHICLE.] "Alternative fuel 
  6.31  vehicle" means a dedicated, flexible, or a dual-fuel vehicle 
  6.32  operated primarily on an alternative fuel. 
  6.33     Sec. 3.  Minnesota Statutes 1994, section 296.01, is 
  6.34  amended by adding a subdivision to read: 
  6.35     Subd. 5.  [ALTERNATIVE FUEL VEHICLE.] "Alternative fuel 
  6.36  vehicle" means a dedicated, flexible, or dual-fuel vehicle 
  7.1   operated primarily on alternative transportation fuel. 
  7.2      Sec. 4.  Minnesota Statutes 1994, section 296.01, is 
  7.3   amended by adding a subdivision to read: 
  7.4      Subd. 11a.  [COMPRESSED NATURAL GAS.] "Compressed natural 
  7.5   gas" or CNG means natural gas, primarily methane, condensed 
  7.6   under high pressure and stored in specially designed storage 
  7.7   tanks at between 2,000 and 3,600 pounds per square inch.  For 
  7.8   purposes of this chapter, the energy content of CNG will be 
  7.9   considered to be 1,000 BTUs per cubic foot. 
  7.10     Sec. 5.  Minnesota Statutes 1994, section 296.01, is 
  7.11  amended by adding a subdivision to read: 
  7.12     Subd. 15c.  [E85.] "E85" means a petroleum product that is 
  7.13  a blend of agriculturally derived denatured ethanol and gasoline 
  7.14  that typically contains 85 percent ethanol by volume, but at a 
  7.15  minimum must contain at least 60 percent ethanol by volume.  For 
  7.16  the purposes of this chapter, the energy content of E85 will be 
  7.17  considered to be 82,000 BTUs per gallon. 
  7.18     Sec. 6.  Minnesota Statutes 1994, section 296.01, is 
  7.19  amended by adding a subdivision to read: 
  7.20     Subd. 23a.  [LIQUEFIED NATURAL GAS.] "Liquefied natural gas"
  7.21  or LNG means natural gas, primarily methane, which has been 
  7.22  condensed through a cryogenic cooling process and is stored in 
  7.23  special pressurized and insulated storage tanks.  For purposes 
  7.24  of this chapter, the energy content of LNG will be considered to 
  7.25  be 69,000 BTUs per gallon. 
  7.26     Sec. 7.  Minnesota Statutes 1994, section 296.01, is 
  7.27  amended by adding a subdivision to read: 
  7.28     Subd. 23b.  [LIQUEFIED PETROLEUM GAS.] "Liquefied petroleum 
  7.29  gas" or LPG or propane means a product made of short hydrocarbon 
  7.30  chains and containing primarily propane and butane that is 
  7.31  stored in specialized tanks at moderate pressure.  For purposes 
  7.32  of this chapter, the energy content of LPG or propane will be 
  7.33  considered to be 86,000 BTUs per gallon. 
  7.34     Sec. 8.  Minnesota Statutes 1994, section 296.01, is 
  7.35  amended by adding a subdivision to read: 
  7.36     Subd. 24b.  [M85.] "M85" means a petroleum product that is 
  8.1   a liquid fuel blend of methanol and gasoline that contains at 
  8.2   least 85 percent methanol by volume.  For the purposes of this 
  8.3   chapter, the energy content of M85 will be considered to be 
  8.4   65,000 BTUs per gallon. 
  8.5      Sec. 9.  Minnesota Statutes 1994, section 296.01, 
  8.6   subdivision 30, is amended to read: 
  8.7      Subd. 30.  [PETROLEUM PRODUCTS.] "Petroleum products" means 
  8.8   all of the products defined in subdivisions 2, 7, 8, 10, 13, 14, 
  8.9   15c, and 17 to 22, and 24b. 
  8.10     Sec. 10.  Minnesota Statutes 1994, section 296.01, 
  8.11  subdivision 34, is amended to read: 
  8.12     Subd. 34.  [SPECIAL FUEL.] "Special fuel" means (1) all 
  8.13  combustible gases and liquid petroleum products or substitutes 
  8.14  therefor including clear diesel fuel, except gasoline, gasoline 
  8.15  blended with ethanol, and agricultural alcohol gasoline which 
  8.16  are delivered into the supply tank of a licensed motor vehicle 
  8.17  or into storage tanks maintained by an owner or operator of a 
  8.18  licensed motor vehicle as a source of supply for such vehicle; 
  8.19  (2) all combustible gases and liquid petroleum products or 
  8.20  substitutes therefor, except gasoline, gasoline blended with 
  8.21  ethanol, and agricultural alcohol gasoline, when delivered to a 
  8.22  licensed special fuel dealer or to the retail service station 
  8.23  storage of a distributor who has elected to pay the special fuel 
  8.24  excise tax as provided in section 296.12, subdivision 3; (3) all 
  8.25  combustible gases and liquid petroleum products or substitutes 
  8.26  therefor, except gasoline, which are used as aviation fuel; or 
  8.27  (4) dyed fuel that is being used illegally in a licensed motor 
  8.28  vehicle.  
  8.29     Sec. 11.  Minnesota Statutes 1994, section 296.02, 
  8.30  subdivision 1, is amended to read: 
  8.31     Subdivision 1.  [TAX IMPOSED; EXCEPTION FOR QUALIFIED 
  8.32  SERVICE STATION.] There is imposed an excise tax on gasoline, 
  8.33  gasoline blended with ethanol, and agricultural alcohol 
  8.34  gasoline, used in producing and generating power for propelling 
  8.35  motor vehicles used on the public highways of this state.  For 
  8.36  purposes of this section, gasoline is defined in section 296.01, 
  9.1   subdivisions 10, 15b, 18, 19, 20, and 24a.  This tax is payable 
  9.2   at the times, in the manner, and by persons specified in this 
  9.3   chapter.  The tax is payable at the rate specified in 
  9.4   subdivision 1b, subject to the exceptions and reductions 
  9.5   specified in this section.  
  9.6      (a) Notwithstanding any other provision of law to the 
  9.7   contrary, the tax imposed on special fuel sold by a qualified 
  9.8   service station may not exceed, or the tax on gasoline delivered 
  9.9   to a qualified service station must be reduced to, a rate not 
  9.10  more than three cents per gallon above the state tax rate 
  9.11  imposed on such products sold by a service station in a 
  9.12  contiguous state located within the distance indicated in clause 
  9.13  (b).  
  9.14     (b) A "qualifying service station" means a service station 
  9.15  located within 7.5 miles, measured by the shortest route by 
  9.16  public road, from a service station selling like product in the 
  9.17  contiguous state.  
  9.18     (c) A qualified service station shall be allowed a credit 
  9.19  by the supplier or distributor, or both, for the amount of 
  9.20  reduction computed in accordance with clause (a).  
  9.21     A qualified service station, before receiving the credit, 
  9.22  shall be registered with the commissioner of revenue.  
  9.23     Sec. 12.  Minnesota Statutes 1994, section 296.02, 
  9.24  subdivision 1a, is amended to read: 
  9.25     Subd. 1a.  [TRANSIT SYSTEMS AND ALTERNATIVE FUELS EXEMPT.] 
  9.26  The provisions of subdivision 1 do not apply to (1) gasoline 
  9.27  purchased by a transit system or transit provider receiving 
  9.28  financial assistance or reimbursement under section 174.24, 
  9.29  256B.0625, subdivision 17, or 473.384 or (2) sales of compressed 
  9.30  natural gas or propane for use in vehicles displaying a valid 
  9.31  annual alternate fuel permit.  
  9.32     Sec. 13.  Minnesota Statutes 1994, section 296.02, 
  9.33  subdivision 1b, is amended to read: 
  9.34     Subd. 1b.  [RATES IMPOSED.] The gasoline excise tax is 
  9.35  imposed at the following rate rates: 
  9.36     (1) E85 is taxed at the rate of 14.2 cents per gallon; 
 10.1      (2) M85 is taxed at the rate of 11.4 cents per gallon; and 
 10.2      (3) For the period on and after May 1, 1988, All other 
 10.3   gasoline is taxed at the rate of 20 cents per gallon.  
 10.4      Sec. 14.  Minnesota Statutes 1994, section 296.025, 
 10.5   subdivision 1, is amended to read: 
 10.6      Subdivision 1.  [TAX IMPOSED.] There is hereby imposed an 
 10.7   excise tax of the same rate per gallon as the gasoline excise 
 10.8   tax on all special fuel at the rates specified in subdivision 1b.
 10.9   For clear diesel fuel, the tax is imposed on the first 
 10.10  distributor who received the product in Minnesota.  For dyed 
 10.11  fuel being used illegally in a licensed motor vehicle, the tax 
 10.12  is imposed on the owner or operator of the motor vehicle, or in 
 10.13  some instances, on the dealer who supplied the fuel.  For dyed 
 10.14  fuel used in a motor vehicle but subject to a federal exemption, 
 10.15  although no federal tax may be imposed, the fuel is subject to 
 10.16  the state tax.  For other fuels, including jet fuel, propane, 
 10.17  and compressed natural gas, the tax is imposed on the 
 10.18  distributor, special fuel dealer, or bulk purchaser.  This tax 
 10.19  is payable at the time and in the manner specified in this 
 10.20  chapter.  For purposes of this section, "owner or operator" 
 10.21  means the operation of licensed motor vehicles, whether loaded 
 10.22  or empty, whether for compensation or not for compensation, and 
 10.23  whether owned by or leased to the motor carrier who operates 
 10.24  them or causes them to be operated. 
 10.25     Sec. 15.  Minnesota Statutes 1994, section 296.025, 
 10.26  subdivision 1a, is amended to read: 
 10.27     Subd. 1a.  [TRANSIT SYSTEMS AND ALTERNATIVE FUELS EXEMPT.] 
 10.28  The provisions of subdivision 1 do not apply to (1) special fuel 
 10.29  purchased by a transit system or transit provider receiving 
 10.30  financial assistance or reimbursement under section 174.24, 
 10.31  256B.0625, subdivision 17, or 473.384 or (2) sales of compressed 
 10.32  natural gas or propane for use in vehicles displaying a valid 
 10.33  annual alternate fuel permit.  
 10.34     Sec. 16.  Minnesota Statutes 1994, section 296.025, is 
 10.35  amended by adding a subdivision to read: 
 10.36     Subd. 1b.  [TAX RATES.] The special fuel excise tax is 
 11.1   imposed at the following rates: 
 11.2      (1) Liquefied petroleum gas or propane is taxed at the rate 
 11.3   of 15 cents per gallon. 
 11.4      (2) Liquefied natural gas is taxed at the rate of 12 cents 
 11.5   per gallon. 
 11.6      (3) Compressed natural gas is taxed at the rate of $1.739 
 11.7   per thousand cubic feet. 
 11.8      (4) All other special fuel is taxed at the same rate as the 
 11.9   gasoline excise tax. 
 11.10     Sec. 17.  Minnesota Statutes 1994, section 296.0261, is 
 11.11  amended by adding a subdivision to read: 
 11.12     Subd. 10.  [CREDIT; REFUNDS.] (a) A purchaser of an 
 11.13  alternative fuel vehicle permit under subdivisions 1 to 9 prior 
 11.14  to July 1, 1995, shall receive a credit for the unused portion 
 11.15  of the permit fee.  The amount of the credit shall be equal to 
 11.16  the original permit fee and prorated to the number of months 
 11.17  from July 1, 1995, until the expiration date of the permit.  The 
 11.18  credit shall reduce the amount of the vehicle's annual motor 
 11.19  vehicle registration tax as calculated under section 168.013.  
 11.20  The credit shall be applied to the first motor vehicle 
 11.21  registration tax payable after July 1, 1995. 
 11.22     (b) If the amount of the credit calculated under paragraph 
 11.23  (a) exceeds the amount of motor vehicle registration tax due, 
 11.24  the registrar shall pay to the purchaser of the permit a cash 
 11.25  refund equal to the difference between the motor vehicle 
 11.26  registration tax and the credit due. 
 11.27     Sec. 18.  Minnesota Statutes 1994, section 297A.01, 
 11.28  subdivision 3, is amended to read: 
 11.29     Subd. 3.  A "sale" and a "purchase" includes, but is not 
 11.30  limited to, each of the following transactions: 
 11.31     (a) Any transfer of title or possession, or both, of 
 11.32  tangible personal property, whether absolutely or conditionally, 
 11.33  and the leasing of or the granting of a license to use or 
 11.34  consume tangible personal property other than manufactured homes 
 11.35  used for residential purposes for a continuous period of 30 days 
 11.36  or more, for a consideration in money or by exchange or barter; 
 12.1      (b) The production, fabrication, printing, or processing of 
 12.2   tangible personal property for a consideration for consumers who 
 12.3   furnish either directly or indirectly the materials used in the 
 12.4   production, fabrication, printing, or processing; 
 12.5      (c) The furnishing, preparing, or serving for a 
 12.6   consideration of food, meals, or drinks.  "Sale" does not 
 12.7   include: 
 12.8      (1) meals or drinks served to patients, inmates, or persons 
 12.9   residing at hospitals, sanitariums, nursing homes, senior 
 12.10  citizens homes, and correctional, detention, and detoxification 
 12.11  facilities; 
 12.12     (2) meals or drinks purchased for and served exclusively to 
 12.13  individuals who are 60 years of age or over and their spouses or 
 12.14  to the handicapped and their spouses by governmental agencies, 
 12.15  nonprofit organizations, agencies, or churches or pursuant to 
 12.16  any program funded in whole or part through 42 USCA sections 
 12.17  3001 through 3045, wherever delivered, prepared or served; or 
 12.18     (3) meals and lunches served at public and private schools, 
 12.19  universities, or colleges.  Notwithstanding section 297A.25, 
 12.20  subdivision 2, taxable food or meals include, but are not 
 12.21  limited to, the following:  
 12.22     (i) heated food or drinks; 
 12.23     (ii) sandwiches prepared by the retailer; 
 12.24     (iii) single sales of prepackaged ice cream or ice milk 
 12.25  novelties prepared by the retailer; 
 12.26     (iv) hand-prepared or dispensed ice cream or ice milk 
 12.27  products including cones, sundaes, and snow cones; 
 12.28     (v) soft drinks and other beverages prepared or served by 
 12.29  the retailer; 
 12.30     (vi) gum; 
 12.31     (vii) ice; 
 12.32     (viii) all food sold in vending machines; 
 12.33     (ix) party trays prepared by the retailers; and 
 12.34     (x) all meals and single servings of packaged snack food, 
 12.35  single cans or bottles of pop, sold in restaurants and bars; 
 12.36     (d) The granting of the privilege of admission to places of 
 13.1   amusement, recreational areas, or athletic events, except a 
 13.2   world championship football game sponsored by the national 
 13.3   football league, and the privilege of having access to and the 
 13.4   use of amusement devices, tanning facilities, reducing salons, 
 13.5   steam baths, turkish baths, health clubs, and spas or athletic 
 13.6   facilities; 
 13.7      (e) The furnishing for a consideration of lodging and 
 13.8   related services by a hotel, rooming house, tourist court, motel 
 13.9   or trailer camp and of the granting of any similar license to 
 13.10  use real property other than the renting or leasing thereof for 
 13.11  a continuous period of 30 days or more; 
 13.12     (f) The furnishing for a consideration of electricity, gas, 
 13.13  water, or steam for use or consumption within this state, or 
 13.14  local exchange telephone service, intrastate toll service, and 
 13.15  interstate toll service, if that service originates from and is 
 13.16  charged to a telephone located in this state.  Telephone service 
 13.17  includes paging services and private communication service, as 
 13.18  defined in United States Code, title 26, section 4252(d), except 
 13.19  for private communication service purchased by an agent acting 
 13.20  on behalf of the state lottery.  The furnishing for a 
 13.21  consideration of access to telephone services by a hotel to its 
 13.22  guests is a sale under this clause.  Sales by municipal 
 13.23  corporations in a proprietary capacity are included in the 
 13.24  provisions of this clause.  The furnishing of water and sewer 
 13.25  services for residential use shall not be considered a sale.  
 13.26  The sale of natural gas to be used as a fuel in vehicles 
 13.27  propelled by natural gas shall not be considered a sale for the 
 13.28  purposes of this section; 
 13.29     (g) The furnishing for a consideration of cable television 
 13.30  services, including charges for basic service, charges for 
 13.31  premium service, and any other charges for any other 
 13.32  pay-per-view, monthly, or similar television services; 
 13.33     (h) Notwithstanding section 297A.25, subdivisions 9 and 12, 
 13.34  the sales of racehorses including claiming sales and fees paid 
 13.35  for breeding racehorses or horses previously used for racing 
 13.36  shall be considered a "sale" and a "purchase."  "Racehorse" 
 14.1   means a horse that is or is intended to be used for racing and 
 14.2   whose birth has been recorded by the Jockey Club or the United 
 14.3   States Trotting Association or the American Quarter Horse 
 14.4   Association.  "Sale" does not include fees paid for breeding 
 14.5   horses that are not racehorses; 
 14.6      (i) The furnishing for a consideration of parking services, 
 14.7   whether on a contractual, hourly, or other periodic basis, 
 14.8   except for parking at a meter; 
 14.9      (j) The furnishing for a consideration of services listed 
 14.10  in this paragraph: 
 14.11     (i) laundry and dry cleaning services including cleaning, 
 14.12  pressing, repairing, altering, and storing clothes, linen 
 14.13  services and supply, cleaning and blocking hats, and carpet, 
 14.14  drapery, upholstery, and industrial cleaning.  Laundry and dry 
 14.15  cleaning services do not include services provided by coin 
 14.16  operated facilities operated by the customer; 
 14.17     (ii) motor vehicle washing, waxing, and cleaning services, 
 14.18  including services provided by coin-operated facilities operated 
 14.19  by the customer, and rustproofing, undercoating, and towing of 
 14.20  motor vehicles; 
 14.21     (iii) building and residential cleaning, maintenance, and 
 14.22  disinfecting and exterminating services; 
 14.23     (iv) services provided by detective agencies, security 
 14.24  services, burglar, fire alarm, and armored car services not 
 14.25  including services performed within the jurisdiction they serve 
 14.26  by off-duty licensed peace officers as defined in section 
 14.27  626.84, subdivision 1; 
 14.28     (v) pet grooming services; 
 14.29     (vi) lawn care, fertilizing, mowing, spraying and sprigging 
 14.30  services; garden planting and maintenance; tree, bush, and shrub 
 14.31  pruning, bracing, spraying, and surgery; tree, bush, shrub and 
 14.32  stump removal; and tree trimming for public utility lines.  
 14.33  Services performed under a construction contract for the 
 14.34  installation of shrubbery, plants, sod, trees, bushes, and 
 14.35  similar items are not taxable; 
 14.36     (vii) mixed municipal solid waste collection and disposal 
 15.1   management services as described in section 297A.45; 
 15.2      (viii) massages, except when provided by a licensed health 
 15.3   care facility or professional or upon written referral from a 
 15.4   licensed health care facility or professional for treatment of 
 15.5   illness, injury, or disease; and 
 15.6      (ix) the furnishing for consideration of lodging, board and 
 15.7   care services for animals in kennels and other similar 
 15.8   arrangements, but excluding veterinary and horse boarding 
 15.9   services. 
 15.10  The services listed in this paragraph are taxable under section 
 15.11  297A.02 if the service is performed wholly within Minnesota or 
 15.12  if the service is performed partly within and partly without 
 15.13  Minnesota and the greater proportion of the service is performed 
 15.14  in Minnesota, based on the cost of performance.  In applying the 
 15.15  provisions of this chapter, the terms "tangible personal 
 15.16  property" and "sales at retail" include taxable services and the 
 15.17  provision of taxable services, unless specifically provided 
 15.18  otherwise.  Services performed by an employee for an employer 
 15.19  are not taxable under this paragraph.  Services performed by a 
 15.20  partnership or association for another partnership or 
 15.21  association are not taxable under this paragraph if one of the 
 15.22  entities owns or controls more than 80 percent of the voting 
 15.23  power of the equity interest in the other entity.  Services 
 15.24  performed between members of an affiliated group of corporations 
 15.25  are not taxable.  For purposes of this section, "affiliated 
 15.26  group of corporations" includes those entities that would be 
 15.27  classified as a member of an affiliated group under United 
 15.28  States Code, title 26, section 1504, and who are eligible to 
 15.29  file a consolidated tax return for federal income tax purposes; 
 15.30     (k) A "sale" and a "purchase" includes the transfer of 
 15.31  computer software, meaning information and directions that 
 15.32  dictate the function performed by data processing equipment.  A 
 15.33  "sale" and a "purchase" does not include the design, 
 15.34  development, writing, translation, fabrication, lease, or 
 15.35  transfer for a consideration of title or possession of a custom 
 15.36  computer program; and 
 16.1      (l) The granting of membership in a club, association, or 
 16.2   other organization if: 
 16.3      (1) the club, association, or other organization makes 
 16.4   available for the use of its members sports and athletic 
 16.5   facilities (without regard to whether a separate charge is 
 16.6   assessed for use of the facilities); and 
 16.7      (2) use of the sports and athletic facilities is not made 
 16.8   available to the general public on the same basis as it is made 
 16.9   available to members.  
 16.10  Granting of membership includes both one-time initiation fees 
 16.11  and periodic membership dues.  Sports and athletic facilities 
 16.12  include golf courses, tennis, racquetball, handball and squash 
 16.13  courts, basketball and volleyball facilities, running tracks, 
 16.14  exercise equipment, swimming pools, and other similar athletic 
 16.15  or sports facilities.  The provisions of this paragraph do not 
 16.16  apply to camps or other recreation facilities owned and operated 
 16.17  by an exempt organization under section 501(c)(3) of the 
 16.18  Internal Revenue Code of 1986, as amended through December 31, 
 16.19  1992, for educational and social activities for young people 
 16.20  primarily age 18 and under.  
 16.21     Sec. 19.  Minnesota Statutes 1994, section 297A.01, is 
 16.22  amended by adding a subdivision to read: 
 16.23     Subd. 21.  [MIXED MUNICIPAL SOLID WASTE MANAGEMENT 
 16.24  SERVICES.] "Mixed municipal solid waste management services" or 
 16.25  "waste management services" means services relating to the 
 16.26  management of mixed municipal solid waste from collection to 
 16.27  disposal, including transportation and management at waste 
 16.28  facilities.  The definitions in section 115A.03 apply to this 
 16.29  subdivision. 
 16.30     Sec. 20.  Minnesota Statutes 1994, section 297A.135, 
 16.31  subdivision 1, is amended to read: 
 16.32     Subdivision 1.  [TAX IMPOSED.] A tax is imposed on the 
 16.33  lease or rental in this state for not more than 28 days of a 
 16.34  passenger automobile as defined in section 168.011, subdivision 
 16.35  7, a van as defined in section 168.011, subdivision 28, except 
 16.36  for a van designed or adapted primarily for transporting 
 17.1   property rather than passengers, or a pickup truck as defined in 
 17.2   section 168.011, subdivision 29.  The tax is imposed at the rate 
 17.3   of 6.2 percent of the sales price as defined for the purpose of 
 17.4   imposing the sales and use tax in this chapter.  The tax does 
 17.5   not apply to the lease or rental of a hearse or limousine used 
 17.6   in connection with a burial or funeral service.  It applies 
 17.7   whether or not the vehicle is licensed in the state. 
 17.8      Sec. 21.  Minnesota Statutes 1994, section 297A.15, is 
 17.9   amended by adding a subdivision to read: 
 17.10     Subd. 7.  [REFUND; APPROPRIATION; ADULT AND JUVENILE 
 17.11  CORRECTIONAL FACILITIES.] (a) If construction materials and 
 17.12  supplies described in paragraph (b) are purchased by a 
 17.13  contractor, subcontractor, or builder as part of a lump-sum 
 17.14  contract or similar type of contract with a price covering both 
 17.15  labor and materials for use in the project, a refund equal to 20 
 17.16  percent of the taxes paid by the contractor, subcontractor, or 
 17.17  builder must be paid to the governmental subdivision.  An 
 17.18  application must be submitted by the governmental subdivision 
 17.19  and must include sufficient information to permit the 
 17.20  commissioner to verify the sales taxes paid for the project.  
 17.21  The contractor, subcontractor, or builder must furnish to the 
 17.22  governmental subdivision a statement of the cost of the 
 17.23  construction materials and supplies and the sales taxes paid on 
 17.24  them.  The amount required to make the refunds is annually 
 17.25  appropriated to the commissioner.  Interest must be paid on the 
 17.26  refund at the rate in section 270.76 from 60 days after the date 
 17.27  the refund claim is filed with the commissioner. 
 17.28     (b) Construction materials and supplies qualify for the 
 17.29  refund under this section if:  (1) the materials and supplies 
 17.30  are for use in a project to construct or improve an adult or 
 17.31  juvenile correctional facility in a county, home rule charter 
 17.32  city, or statutory city, and (2) the project is mandated by 
 17.33  state or federal law, rule, or regulation.  The refund applies 
 17.34  regardless of whether the materials and supplies are purchased 
 17.35  by the city or county, or by a contractor, subcontractor, or 
 17.36  builder under a contract with the city or county. 
 18.1      Sec. 22.  Minnesota Statutes 1994, section 297A.25, 
 18.2   subdivision 9, is amended to read: 
 18.3      Subd. 9.  [MATERIALS CONSUMED IN PRODUCTION.] The gross 
 18.4   receipts from the sale of and the storage, use, or consumption 
 18.5   of all materials, including chemicals, fuels, petroleum 
 18.6   products, lubricants, packaging materials, including returnable 
 18.7   containers used in packaging food and beverage products, feeds, 
 18.8   seeds, fertilizers, electricity, gas and steam, used or consumed 
 18.9   in agricultural or industrial production of personal property 
 18.10  intended to be sold ultimately at retail, whether or not the 
 18.11  item so used becomes an ingredient or constituent part of the 
 18.12  property produced are exempt.  Seeds, trees, fertilizers, and 
 18.13  herbicides purchased for use by farmers in the Conservation 
 18.14  Reserve Program under United States Code, title 16, section 
 18.15  590h, the Integrated Farm Management Program under section 1627 
 18.16  of Public Law Number 101-624, the Wheat and Feed Grain Programs 
 18.17  under sections 301 to 305 and 401 to 405 of Public Law Number 
 18.18  101-624, and the conservation reserve program under sections 
 18.19  103F.505 to 103F.531, are included in this exemption.  Sales to 
 18.20  a veterinarian of materials used or consumed in the care, 
 18.21  medication, and treatment of agricultural production animals and 
 18.22  horses used in agricultural production are exempt under this 
 18.23  subdivision.  Chemicals used for cleaning food processing 
 18.24  machinery and equipment are included in this exemption.  
 18.25  Materials, including chemicals, fuels, and electricity purchased 
 18.26  by persons engaged in agricultural or industrial production to 
 18.27  treat waste generated as a result of the production process are 
 18.28  included in this exemption.  Such production shall include, but 
 18.29  is not limited to, research, development, design or production 
 18.30  of any tangible personal property, manufacturing, processing 
 18.31  (other than by restaurants and consumers) of agricultural 
 18.32  products whether vegetable or animal, commercial fishing, 
 18.33  refining, smelting, reducing, brewing, distilling, printing, 
 18.34  mining, quarrying, lumbering, generating electricity and the 
 18.35  production of road building materials.  Such production shall 
 18.36  not include painting, cleaning, repairing or similar processing 
 19.1   of property except as part of the original manufacturing 
 19.2   process.  Machinery, equipment, implements, tools, accessories, 
 19.3   appliances, contrivances, furniture and fixtures, used in such 
 19.4   production and fuel, electricity, gas or steam used for space 
 19.5   heating or lighting, are not included within this exemption; 
 19.6   however, accessory tools, equipment and other short lived items, 
 19.7   which are separate detachable units used in producing a direct 
 19.8   effect upon the product, where such items have an ordinary 
 19.9   useful life of less than 12 months, are included within the 
 19.10  exemption provided herein.  Electricity used to make snow for 
 19.11  outdoor use for ski hills, ski slopes, or ski trails is included 
 19.12  in this exemption. 
 19.13     Sec. 23.  Minnesota Statutes 1994, section 297A.25, 
 19.14  subdivision 11, is amended to read: 
 19.15     Subd. 11.  [SALES TO GOVERNMENT.] The gross receipts from 
 19.16  all sales, including sales in which title is retained by a 
 19.17  seller or a vendor or is assigned to a third party under an 
 19.18  installment sale or lease purchase agreement under section 
 19.19  465.71, of tangible personal property to, and all storage, use 
 19.20  or consumption of such property by, the United States and its 
 19.21  agencies and instrumentalities, the University of Minnesota, 
 19.22  state universities, community colleges, technical colleges, 
 19.23  state academies, the Minnesota center for arts education, and 
 19.24  school districts are exempt. 
 19.25     As used in this subdivision, "school districts" means 
 19.26  public school entities and districts of every kind and nature 
 19.27  organized under the laws of the state of Minnesota, including, 
 19.28  without limitation, school districts, intermediate school 
 19.29  districts, education districts, educational cooperative service 
 19.30  units, secondary vocational cooperative centers, special 
 19.31  education cooperatives, joint purchasing cooperatives, 
 19.32  telecommunication cooperatives, regional management information 
 19.33  centers, technical colleges, joint vocational technical 
 19.34  districts, and any instrumentality of a school district, as 
 19.35  defined in section 471.59. 
 19.36     Sales exempted by this subdivision include sales under 
 20.1   section 297A.01, subdivision 3, paragraph (f), but do not 
 20.2   include sales under section 297A.01, subdivision 3, paragraph 
 20.3   (j), clause (vii).  
 20.4      Sales to hospitals and nursing homes owned and operated by 
 20.5   political subdivisions of the state are exempt under this 
 20.6   subdivision.  
 20.7      The sales to and exclusively for the use of libraries of 
 20.8   books, periodicals, audio-visual materials and equipment, 
 20.9   photocopiers for use by the public, and all cataloging and 
 20.10  circulation equipment, and cataloging and circulation software 
 20.11  for library use are exempt under this subdivision.  For purposes 
 20.12  of this paragraph "libraries" means libraries as defined in 
 20.13  section 134.001, county law libraries under chapter 134A, the 
 20.14  state library under section 480.09, and the legislative 
 20.15  reference library. 
 20.16     Sales of supplies and equipment used in the operation of an 
 20.17  ambulance service owned and operated by a political subdivision 
 20.18  of the state are exempt under this subdivision provided that the 
 20.19  supplies and equipment are used in the course of providing 
 20.20  medical care.  Sales to a political subdivision of repair and 
 20.21  replacement parts for emergency rescue vehicles and fire trucks 
 20.22  and apparatus are exempt under this subdivision.  
 20.23     Sales to a political subdivision of machinery and 
 20.24  equipment, except for motor vehicles, used directly for mixed 
 20.25  municipal solid waste collection and disposal management 
 20.26  services at a solid waste disposal facility as defined in 
 20.27  section 115A.03, subdivision 10, are exempt under this 
 20.28  subdivision.  
 20.29     Sales to political subdivisions of chore and homemaking 
 20.30  services to be provided to elderly or disabled individuals are 
 20.31  exempt. 
 20.32     This exemption shall not apply to building, construction or 
 20.33  reconstruction materials purchased by a contractor or a 
 20.34  subcontractor as a part of a lump-sum contract or similar type 
 20.35  of contract with a guaranteed maximum price covering both labor 
 20.36  and materials for use in the construction, alteration, or repair 
 21.1   of a building or facility.  This exemption does not apply to 
 21.2   construction materials purchased by tax exempt entities or their 
 21.3   contractors to be used in constructing buildings or facilities 
 21.4   which will not be used principally by the tax exempt entities. 
 21.5      This exemption does not apply to the leasing of a motor 
 21.6   vehicle as defined in section 297B.01, subdivision 5, except for 
 21.7   leases entered into by the United States or its agencies or 
 21.8   instrumentalities.  
 21.9      The tax imposed on sales to political subdivisions of the 
 21.10  state under this section applies to all political subdivisions 
 21.11  other than those explicitly exempted under this subdivision, 
 21.12  notwithstanding section 115A.69, subdivision 6, 116A.25, 
 21.13  360.035, 458A.09, 458A.30, 458D.23, 469.101, subdivision 2, 
 21.14  469.127, 473.394, 473.448, 473.545, or 473.608 or any other law 
 21.15  to the contrary enacted before 1992. 
 21.16     Sales exempted by this subdivision include sales made to 
 21.17  other states or political subdivisions of other states, if the 
 21.18  sale would be exempt from taxation if it occurred in that state, 
 21.19  but do not include sales under section 297A.01, subdivision 3, 
 21.20  paragraphs (c) and (e). 
 21.21     Sec. 24.  Minnesota Statutes 1994, section 297A.25, 
 21.22  subdivision 59, is amended to read: 
 21.23     Subd. 59.  [FARM MACHINERY.] From July 1, 1994, until June 
 21.24  30, 1995 1996, the gross receipts from the sale of used farm 
 21.25  machinery are exempt. 
 21.26     Sec. 25.  [297A.2574] [AGRICULTURE PROCESSING FACILITY 
 21.27  MATERIALS; EXEMPTION.] 
 21.28     Subdivision 1.  [EXEMPTION; DEFINITION.] Purchases of 
 21.29  construction materials and supplies are exempt from the sales 
 21.30  and use taxes imposed under this chapter, regardless of whether 
 21.31  purchased by the owner or a contractor, subcontractor, or 
 21.32  builder, if the materials and supplies are used or consumed in 
 21.33  constructing an agriculture processing facility that meets the 
 21.34  requirements of this section.  For purposes of this section, 
 21.35  "agricultural processing facility" means land, buildings, 
 21.36  structures, fixtures, and improvements used or operated 
 22.1   primarily for the processing or production of marketable 
 22.2   products from agricultural crops, including waste and residues 
 22.3   from agricultural crops, but not including livestock or 
 22.4   livestock products, poultry or poultry products, or wood or wood 
 22.5   products.  
 22.6      Subd. 2.  [QUALIFICATIONS.] An agricultural processing 
 22.7   facility qualifies for the exemption provided under this section 
 22.8   if it meets each of the following requirements: 
 22.9      (a) The total investment in the facility must be at least 
 22.10  $8,500,000. 
 22.11     (b) The facility must be located in a municipality that has 
 22.12  a median household income that does not exceed $18,000 according 
 22.13  to the 1990 federal census information on income and poverty 
 22.14  status in 1989. 
 22.15     (c) The total investment in the facility must exceed an 
 22.16  amount equal to $12,000 per resident of the municipality in 
 22.17  which the facility is located. 
 22.18     Subd. 3.  [COLLECTION AND REFUND OF TAX.] The tax shall be 
 22.19  imposed and collected as if the rates under sections 297A.02, 
 22.20  subdivision 1, and 297A.021, applied, and then refunded in the 
 22.21  manner provided in section 297A.15, subdivision 5. 
 22.22     Sec. 26.  Minnesota Statutes 1994, section 297A.45, is 
 22.23  amended to read: 
 22.24     297A.45 [MIXED MUNICIPAL SOLID WASTE COLLECTION AND 
 22.25  DISPOSAL MANAGEMENT SERVICES.] 
 22.26     Subdivision 1.  [DEFINITIONS.] The definitions in sections 
 22.27  115A.03 and 297A.01 apply to this section.  
 22.28     Subd. 2.  [APPLICATION.] The taxes imposed by sections 
 22.29  297A.02 and 297A.021 apply to all public and private mixed 
 22.30  municipal solid waste collection and disposal management 
 22.31  services.  
 22.32     Notwithstanding section 297A.25, subdivision 11, a 
 22.33  political subdivision that purchases collection or disposal 
 22.34  waste management services on behalf of its citizens shall pay 
 22.35  the taxes. 
 22.36     If a political subdivision provides collection or disposal 
 23.1   services a waste management service to its residents at a cost 
 23.2   in excess of the total direct charge to the residents for the 
 23.3   service, the political subdivision shall pay the taxes based on 
 23.4   its cost of providing the service in excess of the direct 
 23.5   charges.  
 23.6      A person who transports mixed municipal solid waste 
 23.7   generated by that person or by another person without 
 23.8   compensation shall pay the taxes at the disposal or resource 
 23.9   recovery waste facility based on the disposal charge or tipping 
 23.10  fee. 
 23.11     Subd. 3.  [EXEMPTIONS.] (a) The cost of a service or the 
 23.12  portion of a service to collect and manage recyclable materials 
 23.13  separated from mixed municipal solid waste by the waste 
 23.14  generator is exempt from the taxes imposed in sections 297A.02 
 23.15  and 297A.021. 
 23.16     (b) The amount of a surcharge or fee imposed under section 
 23.17  115A.919, 115A.921, 115A.923, or 473.843 is exempt from the 
 23.18  taxes imposed in sections 297A.02 and 297A.021. 
 23.19     (c) Waste from a recycling facility that separates or 
 23.20  processes recyclable materials and that reduces the volume of 
 23.21  the waste by at least 85 percent is exempt from the taxes 
 23.22  imposed in sections 297A.02 and 297A.021.  To qualify for the 
 23.23  exemption under this paragraph, the waste exempted must be 
 23.24  collected and disposed of managed separately from other solid 
 23.25  waste. 
 23.26     (d) The following costs are exempt from the taxes imposed 
 23.27  in sections 297A.02 and 297A.021: 
 23.28     (1) costs of providing educational materials and other 
 23.29  information to residents; 
 23.30     (2) costs of managing solid waste other than mixed 
 23.31  municipal solid waste, including household hazardous waste; and 
 23.32     (3) costs of regulatory and enforcement activities. 
 23.33     (e) The cost of a waste management service is exempt from 
 23.34  the taxes imposed in sections 297A.02 and 297A.021 to the extent 
 23.35  that the cost was previously subject to the tax. 
 23.36     Subd. 4.  [CITY SALES TAX MAY NOT BE IMPOSED.] 
 24.1   Notwithstanding any other law or charter provision to the 
 24.2   contrary, a home rule charter or statutory city that imposes a 
 24.3   general sales tax may not impose the sales tax on solid waste 
 24.4   disposal and collection management services that are subject to 
 24.5   the tax under this section.  This subdivision does not apply to 
 24.6   a tax imposed under section 297A.021.  
 24.7      Subd. 5.  [SEPARATE ACCOUNTING.] The commissioner shall 
 24.8   account for revenue collected from public and private mixed 
 24.9   municipal solid waste collection and disposal management 
 24.10  services under this section separately from other tax revenue 
 24.11  collected under this chapter.  
 24.12     Sec. 27.  Laws 1986, chapter 400, section 44, is amended to 
 24.13  read: 
 24.14     Sec. 44.  [DOWNTOWN TAXING AREA.] 
 24.15     If a bill is enacted into law in the 1986 legislative 
 24.16  session which authorizes the city of Minneapolis to issue bonds 
 24.17  and expend certain funds including taxes to finance the 
 24.18  acquisition and betterment of a convention center and related 
 24.19  facilities, which authorizes certain taxes to be levied in a 
 24.20  downtown taxing area, then, notwithstanding the provisions of 
 24.21  that law "downtown taxing area" shall mean the geographic area 
 24.22  bounded by the portion of the Mississippi River between I-35W 
 24.23  and Washington Avenue, the portion of Washington Avenue between 
 24.24  the river and I-35W, the portion of I-35W between Washington 
 24.25  Avenue and 8th Street South, the portion of 8th Street South 
 24.26  between I-35W and Portland Avenue South, the portion of Portland 
 24.27  Avenue South between 8th Street South and I-94, the portion of 
 24.28  I-94 from the intersection of Portland Avenue South to the 
 24.29  intersection of I-94 and the Burlington Northern Railroad 
 24.30  tracks, the portion of the Burlington Northern Railroad tracks 
 24.31  from I-94 to Main Street and including Nicollet Island, and the 
 24.32  portion of Main Street to Hennepin Avenue and the portion of 
 24.33  Hennepin Avenue between Main Street and 2nd Street S.E., and the 
 24.34  portion of 2nd Street S.E. between Main Street and Bank Street, 
 24.35  and the portion of Bank Street between 2nd Street S.E. and 
 24.36  University Avenue S.E., and the portion of University Avenue 
 25.1   S.E. between Bank Street and I-35W, and by I-35W from University 
 25.2   Avenue S.E., to the river.  The downtown taxing area excludes 
 25.3   the area bounded on the south and west by Oak Grove Street, on 
 25.4   the east by Spruce Place, and on the north by West 15th Street. 
 25.5      Sec. 28.  Laws 1991, chapter 291, article 8, section 28, 
 25.6   subdivision 1, is amended to read: 
 25.7      Subdivision 1.  [AUTHORIZATION.] Notwithstanding Minnesota 
 25.8   Statutes, section 469.190, 477A.016, or other law, in addition 
 25.9   to the tax authorized in Minnesota Statutes, section 469.190, 
 25.10  the city of Winona may, by ordinance, impose a tax of up to one 
 25.11  percent on the gross receipts from the furnishing for 
 25.12  consideration of lodging at a hotel, motel, rooming house, 
 25.13  tourist court, or resort, other than the renting or leasing of 
 25.14  it for a continuous period of 30 days or more.  The city may, by 
 25.15  ordinance, impose the tax authorized under this section on the 
 25.16  camping site receipts of a municipal campground. 
 25.17     Fifty percent of The proceeds of this tax shall be used to 
 25.18  retire the indebtedness of the Julius C. Wilke Steamboat 
 25.19  Center and.  Upon retirement of the debt, 50 percent of the 
 25.20  proceeds shall be used as directed in Minnesota Statutes, 
 25.21  section 469.190, subdivision 3.  The balance shall be used in 
 25.22  the manner of the tax proceeds may be used to promote tourist 
 25.23  activities, as determined by resolution of the council, for the 
 25.24  following purposes: 
 25.25     (1) improvements to the levee, dockage areas, and the 
 25.26  adjacent area, including provision of utilities and construction 
 25.27  of facilities for ticket and souvenir sales and related office 
 25.28  space; or 
 25.29     (2) as directed in Minnesota Statutes, section 469.190, 
 25.30  subdivision 3.  Upon retirement of the debt, the council shall 
 25.31  by ordinance reduce the tax by one-half percent or dedicate the 
 25.32  entire one percent in the manner directed in Minnesota Statutes, 
 25.33  section 469.190, subdivision 3. 
 25.34     The tax shall be collected in the same manner as other 
 25.35  taxes authorized under Minnesota Statutes, section 469.190. 
 25.36     Sec. 29.  [REPEALER.] 
 26.1      (a) Minnesota Statutes 1994, section 296.0261, is repealed. 
 26.2      (b) Minnesota Statutes 1994, section 297A.136, is repealed. 
 26.3      Sec. 30.  [EFFECTIVE DATE.] 
 26.4      Sections 1, 2, 3 to 17, and 29, paragraph (a), are 
 26.5   effective July 1, 1995. 
 26.6      Section 20 is effective beginning with leases or rentals 
 26.7   made after June 30, 1995. 
 26.8      Sections 18, 19, 23, and 26 are effective the day following 
 26.9   final enactment. 
 26.10     Section 21 is effective retroactively for sales after May 
 26.11  31, 1992. 
 26.12     Section 22 is effective for sales made after July 1, 1995. 
 26.13     Section 25 is effective for sales made after March 31, 1995.
 26.14     Section 28 is effective upon compliance by the governing 
 26.15  body of the city of Winona with Minnesota Statutes, section 
 26.16  645.021, subdivision 3. 
 26.17     Section 27 is effective upon compliance by the Minneapolis 
 26.18  city council with Minnesota Statutes, section 645.021, 
 26.19  subdivision 3. 
 26.20     Section 29, paragraph (b), is effective for sales of 900 
 26.21  information services made after June 30, 1995. 
 26.22                             ARTICLE 3
 26.23                        PROPERTY TAX FREEZE
 26.24     Section 1.  Minnesota Statutes 1994, section 6.745, 
 26.25  subdivision 1, is amended to read: 
 26.26     Subdivision 1.  [CITIES.] Annually, upon adoption of the 
 26.27  city budget, the city council of each home rule charter or 
 26.28  statutory city shall forward summary budget information to the 
 26.29  office of the state auditor.  The summary budget information 
 26.30  shall be provided on forms prescribed by the state auditor.  The 
 26.31  office of the state auditor shall work with representatives of 
 26.32  city government to develop a budget reporting form that conforms 
 26.33  with city budgeting practices and provides the necessary summary 
 26.34  budget information to the office of the state auditor.  The 
 26.35  summary budget data shall be provided to the office of the state 
 26.36  auditor no later than December January 31 of the year preceding 
 27.1   each budget year. 
 27.2      Sec. 2.  Minnesota Statutes 1994, section 134.34, 
 27.3   subdivision 4a, is amended to read: 
 27.4      Subd. 4a.  [SUPPORT GRANTS.] In state fiscal years 1993, 
 27.5   1994, and 1995, and 1996, a regional library basic system 
 27.6   support grant also may be made to a regional public library 
 27.7   system for a participating city or county which meets the 
 27.8   requirements under paragraph (a) or, (b), or (c). 
 27.9      (a) The city or county decreases the dollar amount provided 
 27.10  by it for operating purposes of public library service if the 
 27.11  amount provided by the city or county is not less than the 
 27.12  amount provided by the city or county for such purposes in the 
 27.13  second preceding year. 
 27.14     (b)(1) The city or county provided for operating purposes 
 27.15  of public library services an amount exceeding 125 percent of 
 27.16  the state average percentage of the adjusted net tax capacity or 
 27.17  125 percent of the state average local support per capita; and 
 27.18     (2) the local government aid distribution for the current 
 27.19  calendar year under chapter 477A has been reduced below the 
 27.20  originally certified amount for payment in the preceding 
 27.21  calendar year, if the dollar amount of the reduction from the 
 27.22  previous calendar year in support for operating purposes of 
 27.23  public library services is not greater than the dollar amount by 
 27.24  which support for operating purposes of public library service 
 27.25  would be decreased if the reduction in support were in direct 
 27.26  proportion to the local government aid reduction as a percentage 
 27.27  of the previous calendar year's revenue base as defined in 
 27.28  section 477A.011, subdivision 27.  Determination of a grant 
 27.29  under paragraph (b) shall be based on the most recent calendar 
 27.30  year for which data are available. 
 27.31     (c) In 1996, the city or county maintains the dollar amount 
 27.32  provided by it for operating purposes of public library service 
 27.33  at least at the same dollar amount it provided in 1995. 
 27.34     The city or county shall file a report with the department 
 27.35  of education indicating the dollar amount and percentage of 
 27.36  reduction in public library operating funds. 
 28.1      Sec. 3.  Minnesota Statutes 1994, section 254B.02, 
 28.2   subdivision 3, is amended to read: 
 28.3      Subd. 3.  [RESERVE ACCOUNT.] The commissioner shall 
 28.4   allocate money from the reserve account to counties that, during 
 28.5   the current fiscal year, have met or exceeded the base level of 
 28.6   expenditures for eligible chemical dependency services from 
 28.7   local money.  The commissioner shall establish the base level 
 28.8   for fiscal year 1988 as the amount of local money used for 
 28.9   eligible services in calendar year 1986.  In later years, the 
 28.10  base level must be increased in the same proportion as state 
 28.11  appropriations to implement Laws 1986, chapter 394, sections 8 
 28.12  to 20, are increased.  The base level must be decreased if the 
 28.13  fund balance from which allocations are made under section 
 28.14  254B.02, subdivision 1, is decreased in later years.  The base 
 28.15  level of expenditures for each county is defined as 15 percent 
 28.16  of the funds allocated to the county under subdivisions 1 and 
 28.17  2.  The local match rate for the reserve account is the same 
 28.18  rate as applied to the initial allocation.  Reserve account 
 28.19  payments must not be included when calculating the county 
 28.20  adjustments made according to subdivision 2. 
 28.21     Sec. 4.  Minnesota Statutes 1994, section 256H.09, 
 28.22  subdivision 3, is amended to read: 
 28.23     Subd. 3.  [CHILD CARE FUND PLAN.] Effective January 1, 
 28.24  1992, the county will include the plan required under this 
 28.25  subdivision in its biennial community social services plan 
 28.26  required in this section, for the group described in section 
 28.27  256E.03, subdivision 2, paragraph (h).  For the period July 1, 
 28.28  1989, to December 31, 1991, the county shall submit separate 
 28.29  child care fund plans required under this subdivision for the 
 28.30  periods July 1, 1989, to June 30, 1990; and July 1, 1990, to 
 28.31  December 31, 1991.  The commissioner shall establish the dates 
 28.32  by which the county must submit these plans.  The county and 
 28.33  designated administering agency shall submit to the commissioner 
 28.34  an annual child care fund allocation plan.  The plan shall 
 28.35  include: 
 28.36     (1) a narrative of the total program for child care 
 29.1   services, including all policies and procedures that affect 
 29.2   eligible families and are used to administer the child care 
 29.3   funds; 
 29.4      (2) the number of families that requested a child care 
 29.5   subsidy in the previous year, the number of families receiving 
 29.6   child care assistance, the number of families on a waiting list, 
 29.7   and the number of families projected to be served during the 
 29.8   fiscal year; 
 29.9      (3) the methods used by the county to inform eligible 
 29.10  groups of the availability of child care assistance and related 
 29.11  services; 
 29.12     (4) the provider rates paid for all children by provider 
 29.13  type; 
 29.14     (5) the county prioritization policy for all eligible 
 29.15  groups under the basic sliding fee program and AFDC child care 
 29.16  program; 
 29.17     (6) a report of all funds available to be used for child 
 29.18  care assistance, including demonstration of compliance with the 
 29.19  maintenance of funding effort required under section 256H.12; 
 29.20  and 
 29.21     (7) other information as requested by the department to 
 29.22  ensure compliance with the child care fund statutes and rules 
 29.23  promulgated by the commissioner. 
 29.24     The commissioner shall notify counties within 60 days of 
 29.25  the date the plan is submitted whether the plan is approved or 
 29.26  the corrections or information needed to approve the plan.  The 
 29.27  commissioner shall withhold a county's allocation until it has 
 29.28  an approved plan.  Plans not approved by the end of the second 
 29.29  quarter after the plan is due may result in a 25 percent 
 29.30  reduction in allocation.  Plans not approved by the end of the 
 29.31  third quarter after the plan is due may result in a 100 percent 
 29.32  reduction in the allocation to the county.  Counties are to 
 29.33  maintain services despite any reduction in their allocation due 
 29.34  to plans not being approved. 
 29.35     Sec. 5.  Minnesota Statutes 1994, section 279.09, is 
 29.36  amended to read: 
 30.1      279.09 [PUBLICATION OF NOTICE AND LIST.] 
 30.2      The county auditor shall cause the notice and list of 
 30.3   delinquent real property to be published once in each of two 
 30.4   consecutive weeks in the newspaper designated, the first 
 30.5   publication of which shall be made on or before March 20 
 30.6   immediately following the filing of such list with the court 
 30.7   administrator of the district court.  The auditor shall deliver 
 30.8   such list to the publisher of the newspaper designated, at least 
 30.9   20 days before the date upon which the list shall be published 
 30.10  for the first time.  
 30.11     Sec. 6.  Minnesota Statutes 1994, section 279.10, is 
 30.12  amended to read: 
 30.13     279.10 [PUBLICATION CORRECTED.] 
 30.14     Immediately after preparing forms for printing such notice 
 30.15  and list, and at least five days before the first day for the 
 30.16  publication thereof, every such publisher shall furnish proof of 
 30.17  the proposed publication to the county auditor for correction.  
 30.18  When such copy has been corrected , the auditor shall return the 
 30.19  same to the printer, who shall publish it as corrected.  On the 
 30.20  first day on which such notice and list are published, the 
 30.21  publisher shall mail a copy of the newspaper containing the same 
 30.22  to the auditor.  If during the publication of the notice and 
 30.23  list, or within ten days after the last publication thereof, the 
 30.24  auditor shall discover that such publication is invalid, the 
 30.25  auditor shall forthwith direct the publisher to republish the 
 30.26  same as corrected for an additional period of two weeks.  The 
 30.27  publisher, if not neglectful, shall be entitled to the same 
 30.28  compensation as allowed by law for the original publication, but 
 30.29  shall receive no further compensation therefor if such 
 30.30  republication is necessary by reason of the neglect of the 
 30.31  publisher. 
 30.32     Sec. 7.  Minnesota Statutes 1994, section 281.23, 
 30.33  subdivision 3, is amended to read: 
 30.34     Subd. 3.  [PUBLICATION.] As soon as practicable after the 
 30.35  posting of the notice prescribed in subdivision 2, the county 
 30.36  auditor shall cause to be published for two successive weeks, in 
 31.1   the official newspaper of the county, the notice prescribed by 
 31.2   subdivision 2.  
 31.3      Sec. 8.  Minnesota Statutes 1994, section 375.169, is 
 31.4   amended to read: 
 31.5      375.169 [PUBLICATION OF SUMMARY BUDGET STATEMENT.] 
 31.6      Annually, upon adoption of the county budget, the county 
 31.7   board shall cause a summary budget statement to be published in 
 31.8   one of the following: 
 31.9      (1) the official newspaper of the county, or if there is 
 31.10  none, in a qualified newspaper of general circulation in the 
 31.11  county; or 
 31.12     (2) for a county in the metropolitan area as defined in 
 31.13  section 473.121, subdivision 2, a county newsletter or other 
 31.14  county mailing sent to all households in the city, or as an 
 31.15  insert with the truth-in-taxation notice under section 275.065.  
 31.16     If the summary budget statement is published in a county 
 31.17  newsletter, it must be the lead story.  If the summary budget 
 31.18  statement is published through a county newsletter or other 
 31.19  county mailing, a copy of the newsletter or mailing shall be 
 31.20  sent on request to any nonresident.  If the summary budget 
 31.21  statement is published by a mailing to households other than a 
 31.22  newsletter, the color of the paper on which the summary budget 
 31.23  statement is printed must be distinctively different than the 
 31.24  paper containing other printed material included in the 
 31.25  mailing.  The statement shall contain information relating to 
 31.26  anticipated revenues and expenditures in a form prescribed by 
 31.27  the state auditor.  The form prescribed shall be designed so 
 31.28  that comparisons can be made between the current year and the 
 31.29  budget year.  A note shall be included that the complete budget 
 31.30  is available for public inspection at a designated location 
 31.31  within the county.  
 31.32     Sec. 9.  Minnesota Statutes 1994, section 471.6965, is 
 31.33  amended to read: 
 31.34     471.6965 [PUBLICATION OF SUMMARY BUDGET STATEMENT.] 
 31.35     Annually, upon adoption of the city budget, the city 
 31.36  council shall publish a summary budget statement in either of 
 32.1   the following: 
 32.2      (1) the official newspaper of the city, or if there is 
 32.3   none, in a qualified newspaper of general circulation in the 
 32.4   city; or 
 32.5      (2) for a city in the metropolitan area as defined in 
 32.6   section 473.121, subdivision 2, a city newsletter or other city 
 32.7   mailing sent to all taxpayers in the city, or as an insert with 
 32.8   the truth-in-taxation notice under section 275.065.  
 32.9      If the summary budget statement is published in a city 
 32.10  newsletter, it must be the lead cover story.  If the summary 
 32.11  budget statement is published by a mailing to taxpayers other 
 32.12  than a newsletter, the color of the paper on which the summary 
 32.13  budget statement is printed must be distinctively different than 
 32.14  the paper containing other printed material included in the 
 32.15  mailing. 
 32.16     The statement shall contain information relating to 
 32.17  anticipated revenues and expenditures, in a form prescribed by 
 32.18  the state auditor.  The form prescribed shall be designed so 
 32.19  that comparisons can be made between the current year and the 
 32.20  budget year.  A note shall be included that the complete budget 
 32.21  is available for public inspection at a designated location 
 32.22  within the city.  If the summary budget statement is published 
 32.23  through a city newsletter or other city mailing, a copy of the 
 32.24  statement must be posted, in a common area, by the property 
 32.25  owner of all residential nonhomestead property as defined in 
 32.26  section 273.13, subdivision 25, paragraphs (a) and (b), clause 
 32.27  (1). 
 32.28     Sec. 10.  [EDUCATION FINANCE FOR THE 1996-1997 SCHOOL 
 32.29  YEAR.] 
 32.30     Subdivision 1.  [ADJUSTED TAX CAPACITY FOR SCHOOL YEAR 
 32.31  1996-1997.] Notwithstanding any other law to the contrary, for 
 32.32  purposes of any levy authorized under Minnesota Statutes, 
 32.33  chapter 124, 124A, 124B, 136C, or 136D, the adjusted net tax 
 32.34  capacity of a school district, education district, intermediate 
 32.35  school district, or technical college under Minnesota Statutes, 
 32.36  section 124.2131, for the 1996-1997 school year shall equal the 
 33.1   adjusted net tax capacity used for computation of its levy 
 33.2   limits for the 1995-1996 school year. 
 33.3      Subd. 2.  [LOCAL EFFORT TAX RATE AND EQUALIZING FACTOR.] 
 33.4   Notwithstanding any other law to the contrary, the local effort 
 33.5   tax rates computed under Minnesota Statutes, sections 124.226, 
 33.6   subdivision 1, and 124A.23, for the 1996-1997 school year shall 
 33.7   equal the local effort tax rates established at the time of levy 
 33.8   limit certification for the 1995-1996 school year.  
 33.9   Notwithstanding any other law to the contrary, the equalizing 
 33.10  factor under Minnesota Statutes, section 124A.02, for the 
 33.11  1996-1997 school year shall equal the equalizing factor for the 
 33.12  1995-1996 school year. 
 33.13     Subd. 3.  [COMPUTATION OF PUPIL UNITS FOR LEVY LIMITS.] 
 33.14  Notwithstanding Minnesota Statutes, section 124.17, or any other 
 33.15  law to the contrary, the number of pupil units and AFDC pupil 
 33.16  units for a school district, education district, intermediate 
 33.17  school district, or technical college for use in computing the 
 33.18  levy limits of the district or technical college for the 
 33.19  1996-1997 school year shall be the pupil units and AFDC pupil 
 33.20  units used for the levy limit computation of the school 
 33.21  district, education district, intermediate school district, or 
 33.22  technical college for the 1995-1996 school year.  For purposes 
 33.23  of computing the revenue entitlement of a school district under 
 33.24  Minnesota Statutes, chapter 124, 124A, 124B, 136C, or 136D, for 
 33.25  the 1996-1997 school year, the pupil units or AFDC pupil units 
 33.26  shall be as otherwise provided under Minnesota Statutes, section 
 33.27  124.17.  If any section of Minnesota Statutes, chapters 124, 
 33.28  124A, and 124B, provides that an aid entitlement is equal to the 
 33.29  difference between the revenue entitlement and the authorized 
 33.30  levy, then the aid entitlement for the 1996-1997 school year 
 33.31  shall equal the difference between the revenue entitlement and 
 33.32  authorized levies computed under this section and sections 11 to 
 33.33  71.  If any section of Minnesota Statutes, chapters 124, 124A, 
 33.34  and 124B, other than sections 124.321 and 124.912, subdivision 
 33.35  2, provide that the aid entitlement will be reduced if a 
 33.36  district fails to exercise its full levy authority and the 
 34.1   district failed to levy its full authority for the 1995-1996 
 34.2   school year, the commissioner shall assume that, absent the 
 34.3   provisions of this act, the district would have elected to 
 34.4   exercise the same portion of its levy authority for the 
 34.5   1996-1997 school year as it did in the prior year and determine 
 34.6   the district's aid under the applicable section and the prior 
 34.7   sentence. 
 34.8      Sec. 11.  [TRANSITIONAL LEVIES.] 
 34.9      Notwithstanding Minnesota Statutes, sections 122.247, 
 34.10  subdivision 3, and 122.533, a school district's levy under those 
 34.11  sections for taxes payable in 1996 shall be no greater than it 
 34.12  was for the prior year. 
 34.13     Sec. 12.  [TRANSPORTATION AID.] 
 34.14     For purposes of computing transportation aid under 
 34.15  Minnesota Statutes, section 124.225, subdivision 8a, for the 
 34.16  1996-1997 school year, levies shall be those computed under the 
 34.17  provisions of sections 10 and 13 to 21. 
 34.18     Sec. 13.  [TRANSPORTATION LEVY.] 
 34.19     Notwithstanding Minnesota Statutes, section 124.226, 
 34.20  subdivision 2, a school district's levy for additional 
 34.21  transportation costs as the result of leasing a school in 
 34.22  another district shall be no greater for the 1996-1997 school 
 34.23  year than it was for the prior year. 
 34.24     Sec. 14.  [OFF-FORMULA ADJUSTMENT.] 
 34.25     Notwithstanding Minnesota Statutes, section 124.226, 
 34.26  subdivision 3, a school district's off-formula adjustment for 
 34.27  taxes payable in 1996 shall be no less than that computed for 
 34.28  taxes payable in the prior year.  If the resulting levy 
 34.29  reduction is greater than that which would have otherwise 
 34.30  occurred under Minnesota Statutes, section 124.226, subdivision 
 34.31  3, the district will receive additional aid equal to the 
 34.32  difference. 
 34.33     Sec. 15.  [TRANSPORTATION LEVY EQUITY.] 
 34.34     Notwithstanding Minnesota Statutes, section 124.226, 
 34.35  subdivision 3a, a school district's aid reduction for 
 34.36  transportation levy equity for the 1996-1997 school year shall 
 35.1   be based on levies computed under sections 10 and 13 to 21. 
 35.2      Sec. 16.  [NONREGULAR TRANSPORTATION COSTS LEVY.] 
 35.3      Notwithstanding Minnesota Statutes, section 124.226, 
 35.4   subdivision 4, a school district's levy for nonregular 
 35.5   transportation costs for the 1996-1997 school year shall be no 
 35.6   greater than it was for the prior year. 
 35.7      Sec. 17.  [EXCESS TRANSPORTATION COSTS LEVY.] 
 35.8      Notwithstanding Minnesota Statutes, section 124.226, 
 35.9   subdivision 5, a school district's levy for excess 
 35.10  transportation costs for the 1996-1997 school year shall be no 
 35.11  greater than it was for the prior year.  If the resulting levy 
 35.12  is less than the school district would have been authorized to 
 35.13  levy under Minnesota Statutes, section 124.226, subdivision 5, 
 35.14  the district shall receive additional aid equal to the 
 35.15  difference. 
 35.16     Sec. 18.  [BUS PURCHASES; LEVY.] 
 35.17     Notwithstanding Minnesota Statutes, section 124.226, 
 35.18  subdivision 6, a school district's levy to eliminate a projected 
 35.19  deficit in its reserved fund balance for bus purchases in its 
 35.20  transportation fund as of June 30 of the 1996-1997 school year 
 35.21  shall be no greater than it was for the prior year. 
 35.22     Sec. 19.  [CONTRACTED SERVICES LEVY.] 
 35.23     Notwithstanding Minnesota Statutes, section 124.226, 
 35.24  subdivision 7, a school district's levy for taxes payable in 
 35.25  1996 under that subdivision shall be no greater than it was in 
 35.26  the prior year.  If the resulting levy is less than the school 
 35.27  district would have been authorized to levy under that 
 35.28  subdivision, the district will receive additional aid equal to 
 35.29  the difference. 
 35.30     Sec. 20.  [LEVY FOR POST-SECONDARY TRANSPORTATION.] 
 35.31     Notwithstanding Minnesota Statutes, section 124.226, 
 35.32  subdivision 8, a school district levy for transportation of 
 35.33  secondary students enrolled in courses provided in an agreement 
 35.34  authorized by Minnesota Statutes, section 123.33, subdivision 7, 
 35.35  for school year 1996-1997 shall be no greater than it was for 
 35.36  the prior year. 
 36.1      Sec. 21.  [LATE ACTIVITY BUSES LEVY.] 
 36.2      Notwithstanding Minnesota Statutes, section 124.226, 
 36.3   subdivision 9, a school district's levy for late activity buses 
 36.4   for the 1995-1996 school year shall be no greater than it was 
 36.5   for the prior year.  If the resulting levy is less than the 
 36.6   school district would have been authorized to levy under 
 36.7   Minnesota Statutes, section 124.226, subdivision 9, the school 
 36.8   district shall receive additional aid equal to the difference. 
 36.9      Sec. 22.  [BONDS.] 
 36.10     (a) Notwithstanding Minnesota Statutes, section 124.239, 
 36.11  after March 30, 1995, no school district can sell bonds under 
 36.12  that section the debt service payments of which would require a 
 36.13  levy first becoming payable in 1996 or authorize a levy under 
 36.14  Minnesota Statutes, section 124.239, subdivision 5, clause (b), 
 36.15  that is not pursuant to a plan adopted prior to March 30, 1995.  
 36.16  This restriction shall not apply to (1) refunding bonds sold to 
 36.17  refund bonds originally sold before March 30, 1995, or (2) bonds 
 36.18  for which the amount of the levy first becoming due in 1996 
 36.19  would not exceed the amount by which the school district's total 
 36.20  levy for debt service on bonds for taxes payable in 1996 prior 
 36.21  to issuance of those bonds is less than the municipality's total 
 36.22  levy for debt service for bonds for taxes payable in 1995. 
 36.23     (b) For purposes of this section, bonds will be deemed to 
 36.24  have been sold before March 30, 1995, if: 
 36.25     (1) an agreement has been entered into between the school 
 36.26  district and a purchaser or underwriter for the sale of the 
 36.27  bonds by that date; 
 36.28     (2) the issuing school district is a party to a contract or 
 36.29  letter of understanding entered into before March 30, 1995, with 
 36.30  the federal government that requires the school district to pay 
 36.31  for a project, and the project will be funded with the proceeds 
 36.32  of the bonds; or 
 36.33     (3) the proceeds of the bonds will be used to fund a 
 36.34  project or acquisition with respect to which the school district 
 36.35  has entered into a contract with a builder or supplier before 
 36.36  March 30.  Debt service payments due on bonds described in this 
 37.1   paragraph during calendar year 1996 will be paid by the state.  
 37.2   The amount of those payments must be repaid by the school 
 37.3   district to the state in three equal annual installments 
 37.4   beginning in 1997.  No interest will be due on those payments if 
 37.5   timely paid by June 15 of the year due. 
 37.6      Sec. 23.  [CAPITAL EXPENDITURE FACILITY LEVY.] 
 37.7      Notwithstanding Minnesota Statutes, sections 124.243 and 
 37.8   124.2442, subdivision 3, a school district's capital 
 37.9   expenditures facilities levy for the 1996-1997 school year shall 
 37.10  be no greater than it was for the prior year. 
 37.11     Sec. 24.  [CAPITAL EXPENDITURE EQUIPMENT LEVY.] 
 37.12     Notwithstanding Minnesota Statutes, sections 124.244, 
 37.13  subdivision 2, and 124.2442, a school district's capital 
 37.14  expenditures equipment levy for the 1996-1997 school year shall 
 37.15  be no greater than it was for the prior year. 
 37.16     Sec. 25.  [LEVY FOR ADULT BASIC EDUCATION AID.] 
 37.17     Notwithstanding Minnesota Statutes, section 124.2601, 
 37.18  school districts which did not levy for adult basic education 
 37.19  for taxes payable in 1995, may not levy for that purpose for 
 37.20  taxes payable in 1996. 
 37.21     Sec. 26.  [EARLY CHILDHOOD FAMILY EDUCATION AND HOME 
 37.22  VISITATION LEVY.] 
 37.23     Notwithstanding Minnesota Statutes, section 124.2711, 
 37.24  subdivisions 2a and 5, a school district's levy for early 
 37.25  childhood family education and home visitation under Minnesota 
 37.26  Statutes, section 124.2711, subdivision 5, for school year 
 37.27  1996-1997 shall be no greater than it was for the prior year. 
 37.28     Sec. 27.  [COMMUNITY EDUCATION LEVY.] 
 37.29     Notwithstanding Minnesota Statutes, section 124.2713, 
 37.30  subdivision 6, 6a, or 6b, the community education levy of a 
 37.31  school district for the 1996-1997 school year shall be no 
 37.32  greater than it was for the prior year. 
 37.33     Sec. 28.  [LEVY FOR ADDITIONAL COMMUNITY EDUCATION 
 37.34  REVENUE.] 
 37.35     Notwithstanding Minnesota Statutes, section 124.2714, a 
 37.36  school district's levy under that section for school year 
 38.1   1996-1997 shall be no greater than it was for the prior year. 
 38.2      Sec. 29.  [PROGRAMS FOR ADULTS WITH DISABILITIES; LEVY.] 
 38.3      Notwithstanding Minnesota Statutes, section 124.2715, 
 38.4   subdivision 3, a school district's levy for community education 
 38.5   programs for adults with disabilities for the 1996-1997 school 
 38.6   year shall be no greater than it was for the prior year. 
 38.7      Sec. 30.  [EXTENDED DAY LEVY.] 
 38.8      Notwithstanding Minnesota Statutes, section 124.2716, a 
 38.9   school district's levy under that section for the 1996-1997 
 38.10  school year shall be no greater than it was for the prior year. 
 38.11     Sec. 31.  [COOPERATION AND COMBINATION LEVY.] 
 38.12     Notwithstanding Minnesota Statutes, section 124.2725, 
 38.13  subdivisions 3 and 4, a school district's levy for cooperation 
 38.14  and combination for the 1996-1997 school year shall be no 
 38.15  greater than it was for the prior year. 
 38.16     Sec. 32.  [EARLY RETIREMENT AND SEVERANCE LEVY.] 
 38.17     Notwithstanding Minnesota Statutes, section 124.2725, 
 38.18  subdivision 15, a school district's levy for the 1996-1997 
 38.19  school year for severance pay or early retirement incentives for 
 38.20  licensed and nonlicensed staff who retire early as the result of 
 38.21  combination or cooperation shall be no greater than it was for 
 38.22  the prior year. 
 38.23     Sec. 33.  [CONSOLIDATION; RETIREMENT LEVY.] 
 38.24     Notwithstanding Minnesota Statutes, section 124.2726, 
 38.25  subdivision 3, a school district's levy for retirement 
 38.26  incentives under Minnesota Statutes, section 122.23, subdivision 
 38.27  20, for the 1996-1997 school year shall be no greater than it 
 38.28  was for the prior year. 
 38.29     Sec. 34.  [DISTRICT COOPERATION LEVY.] 
 38.30     Notwithstanding Minnesota Statutes, section 124.2727, 
 38.31  subdivisions 6b and 9, a school district's levy for district 
 38.32  cooperation for the 1996-1997 school year shall be no greater 
 38.33  than it was for the prior year. 
 38.34     Sec. 35.  [SPECIAL EDUCATION EQUALIZATION LEVY.] 
 38.35     Notwithstanding Minnesota Statutes, section 124.321, 
 38.36  subdivisions 3 and 5, a school district's special education 
 39.1   equalization levy for the 1996-1997 school year shall be no 
 39.2   greater than it was for the prior year.  If the resulting levy 
 39.3   is less than the school district would have levied under 
 39.4   Minnesota Statutes, section 124.321, subdivisions 3 and 5, the 
 39.5   district shall receive additional aid equal to the difference. 
 39.6      Sec. 36.  [ALTERNATIVE DELIVERY LEVY.] 
 39.7      Notwithstanding Minnesota Statutes, section 124.322, 
 39.8   subdivision 4, a school district's levy for alternative delivery 
 39.9   of specialized instructional services for the 1996-1997 school 
 39.10  year shall be no greater than it was for the prior year.  If the 
 39.11  resulting levy is less than the school district would have 
 39.12  levied under Minnesota Statutes, section 124.322, subdivision 4, 
 39.13  the district shall receive additional aid equal to the 
 39.14  difference. 
 39.15     Sec. 37.  [JOINT POWERS BOARD; EARLY RETIREMENT AND 
 39.16  SEVERANCE LEVY.] 
 39.17     Notwithstanding Minnesota Statutes, section 124.4945, a 
 39.18  school district's levy for the 1996-1997 school year for 
 39.19  severance pay and early retirement incentives to a teacher as 
 39.20  defined in Minnesota Statutes, section 125.12, subdivision 1, 
 39.21  who is placed on unrequested leave as the result of a 
 39.22  cooperative secondary facility agreement shall be no greater 
 39.23  than it was for the prior year. 
 39.24     Sec. 38.  [FACILITIES DOWN PAYMENT LEVY REFERENDUM.] 
 39.25     Notwithstanding Minnesota Statutes, section 124.82, 
 39.26  subdivision 3, no facilities down payment levy referendum held 
 39.27  after March 27, 1995, may authorize a levy first becoming 
 39.28  payable in 1996. 
 39.29     Sec. 39.  [HEALTH AND SAFETY LEVY.] 
 39.30     Notwithstanding Minnesota Statutes, section 124.83, 
 39.31  subdivisions 4 and 7, a school district's levy for a health and 
 39.32  safety program under Minnesota Statutes, section 124.83, for the 
 39.33  1996-1997 school year shall be no greater than it was for the 
 39.34  prior year.  If the resulting levy is less than the school 
 39.35  district would have levied under Minnesota Statutes, section 
 39.36  124.83, subdivisions 4 and 7, the district shall receive 
 40.1   additional aid equal to the difference. 
 40.2      Sec. 40.  [HANDICAPPED ACCESS AND FIRE SAFETY LEVY.] 
 40.3      Notwithstanding Minnesota Statutes, section 124.84, 
 40.4   subdivisions 3 and 4, a school district's levy for purposes of 
 40.5   Minnesota Statutes, section 124.84, subdivisions 1 and 2, for 
 40.6   the 1996-1997 school year shall be no greater than it was for 
 40.7   the prior year.  If the resulting levy is less than the school 
 40.8   district would have levied under Minnesota Statutes, section 
 40.9   124.84, subdivision 3, the district may levy the difference in 
 40.10  the subsequent year notwithstanding the five-year limitation in 
 40.11  section 124.84, subdivision 3. 
 40.12     Sec. 41.  [LEVY TO RENT OR LEASE BUILDING OR LAND.] 
 40.13     Notwithstanding Minnesota Statutes, section 124.91, 
 40.14  subdivision 1, after March 30, 1995, the commissioner of 
 40.15  education shall not authorize any school district to make any 
 40.16  additional capital expenditure levy to rent or lease a building 
 40.17  or land for instructional purposes if the levy for that purpose 
 40.18  first becomes due and payable in 1996 unless the district's 
 40.19  capital expenditure levy for taxes payable in 1996, including 
 40.20  the levy for the new obligation, would not exceed its levy for 
 40.21  that purpose for taxes payable in 1995. 
 40.22     Sec. 42.  [LEVY FOR LEASE PURCHASE OR INSTALLMENT BUYS.] 
 40.23     (a) Except as provided in paragraphs (b) and (c), 
 40.24  notwithstanding Minnesota Statutes, section 124.91, subdivision 
 40.25  3, after March 30, 1995, no school district may enter into an 
 40.26  installment contract or a lease purchase agreement the levy for 
 40.27  which would first become payable in 1996 unless the district's 
 40.28  total levy for installment contracts and lease purchase 
 40.29  agreements for taxes payable in 1996, including the levy for the 
 40.30  new obligation, would not exceed its levy for that purpose for 
 40.31  taxes payable in 1995. 
 40.32     (b) The limitation in paragraph (a) does not apply to an 
 40.33  installment contract entered into before July 1, 1995, if it: 
 40.34     (1) relates to a high school construction project that was 
 40.35  approved by the commissioner of education under Minnesota 
 40.36  Statutes, section 121.15, before July 1, 1994; and 
 41.1      (2) relates at least in part to bids awarded between 
 41.2   September 8, 1994, and February 21, 1995. 
 41.3   Payments due on installment contracts described in this 
 41.4   paragraph during calendar year 1996 will be paid by the state.  
 41.5   The amount of those payments will be repaid by the school 
 41.6   district to the state in three equal annual installments 
 41.7   beginning in 1997.  No interest will be due on those payments if 
 41.8   timely paid by June 15 of the year due. 
 41.9      (c) For purposes of this section, installment contracts or 
 41.10  lease purchase agreements will be deemed to have been entered 
 41.11  into before March 30, 1995, if: 
 41.12     (1) an agreement has been entered into between the school 
 41.13  district and a lessor or seller by that date; 
 41.14     (2) the school district is a party to contract or letter of 
 41.15  understanding entered into before March 30, 1995, with the 
 41.16  federal government that requires the school district to pay for 
 41.17  a project, and the project will be funded with the proceeds of 
 41.18  the installment contracts or lease purchase agreements; or 
 41.19     (3) the installment contracts or lease purchase agreements 
 41.20  will be used to fund a project or acquisition with respect to 
 41.21  which the school district has entered into a contract with a 
 41.22  builder or supplier before March 30.  Payments due on 
 41.23  installment contracts or lease purchase agreements described in 
 41.24  this paragraph during calendar year 1996 will be paid by the 
 41.25  state.  The amount of those payments must be repaid by the 
 41.26  school district to the state in three equal annual installments 
 41.27  beginning in 1997.  No interest will be due on those payments if 
 41.28  timely paid by June 15 of the year due. 
 41.29     Sec. 43.  [COOPERATING DISTRICTS; CAPITAL LEVY.] 
 41.30     Notwithstanding Minnesota Statutes, section 124.91, 
 41.31  subdivision 4, a school district's levy under that subdivision 
 41.32  for the 1996-1997 school year shall be no greater than it was 
 41.33  for the prior year. 
 41.34     Sec. 44.  [LEVY FOR INTERACTIVE TELEVISION.] 
 41.35     Notwithstanding Minnesota Statutes, section 124.91, 
 41.36  subdivision 5, a school district's levy for interactive 
 42.1   television for the 1996-1997 school year shall be no greater 
 42.2   than it was for the prior year. 
 42.3      Sec. 45.  [ENERGY CONSERVATION LEVY.] 
 42.4      Notwithstanding Minnesota Statutes, section 124.91, 
 42.5   subdivision 6, a school district may not enter into a loan under 
 42.6   Minnesota Statutes, sections 216C.37 or 298.292 to 298.298 after 
 42.7   March 27, 1995, if the levy for repayment of the loan would 
 42.8   first become payable in 1996. 
 42.9      Sec. 46.  [LEVY FOR STATUTORY OBLIGATIONS.] 
 42.10     Notwithstanding Minnesota Statutes, section 124.912, 
 42.11  subdivision 1, a school district's levy as otherwise authorized 
 42.12  under that subdivision for the 1996-1997 school year shall be no 
 42.13  greater than it was for the prior year.  To the extent that the 
 42.14  portion of the resulting levy for the school district's 
 42.15  obligation under Minnesota Statutes, section 268.06, subdivision 
 42.16  25, and section 268.08, is less than the school district would 
 42.17  have been otherwise authorized to levy under Minnesota Statutes, 
 42.18  section 124.912, subdivision 1, the school district shall 
 42.19  receive additional aid equal to the difference.  To the extent 
 42.20  that the portion of the resulting levy for judgments under 
 42.21  Minnesota Statutes, section 127.05, is less than the school 
 42.22  district would have been authorized to levy under Minnesota 
 42.23  Statutes, section 124.912, subdivision 1, for this purpose, the 
 42.24  school district may levy the difference in the subsequent year. 
 42.25     Sec. 47.  [DESEGREGATION LEVY.] 
 42.26     Notwithstanding Minnesota Statutes, section 124.912, 
 42.27  subdivision 2, a school district's levy as otherwise authorized 
 42.28  under that subdivision for the 1995-1996 school year shall be no 
 42.29  greater than it was for the prior year.  If the resulting levy 
 42.30  is less than the school district would have levied under that 
 42.31  subdivision, the school district shall receive additional aid 
 42.32  equal to the difference. 
 42.33     Sec. 48.  [RULE COMPLIANCE LEVY.] 
 42.34     Notwithstanding Minnesota Statutes, section 124.912, 
 42.35  subdivision 3, a school district's levy as otherwise authorized 
 42.36  under that subdivision for the 1995-1996 school year shall be no 
 43.1   greater than it was for the prior year.  If the resulting levy 
 43.2   is less than the school district would have levied under that 
 43.3   subdivision, the school district shall receive additional aid 
 43.4   equal to the difference. 
 43.5      Sec. 49.  [LEVY FOR CRIME RELATED COSTS.] 
 43.6      Notwithstanding Minnesota Statutes, section 124.912, 
 43.7   subdivision 6, a school district's levy as otherwise authorized 
 43.8   under that subdivision for the 1996-1997 school year shall be no 
 43.9   greater than it was for the prior year. 
 43.10     Sec. 50.  [ICE ARENA LEVY.] 
 43.11     Notwithstanding Minnesota Statutes, section 124.912, 
 43.12  subdivision 7, a school district's levy as otherwise authorized 
 43.13  under that subdivision for the 1996-1997 school year shall be no 
 43.14  greater than it was for the prior year. 
 43.15     Sec. 51.  [OUTPLACEMENT LEVY.] 
 43.16     Notwithstanding Minnesota Statutes, section 124.912, 
 43.17  subdivision 8, the levy as otherwise authorized under that 
 43.18  subdivision for the 1996-1997 school year shall be no greater 
 43.19  than it was for the prior year. 
 43.20     Sec. 52.  [ABATEMENT LEVY.] 
 43.21     Notwithstanding Minnesota Statutes, section 124.912, 
 43.22  subdivision 9, a school district's levy as otherwise authorized 
 43.23  under that subdivision for the 1996-1997 school year shall be no 
 43.24  greater than it was for the prior year.  To the extent the 
 43.25  portion of the resulting levy otherwise authorized under 
 43.26  Minnesota Statutes, section 124.912, subdivision 9, paragraph 
 43.27  (a), clause (1), is less than the school district would have 
 43.28  been authorized to levy under that clause, the district shall 
 43.29  receive additional aid equal to the difference.  The remaining 
 43.30  portion of the resulting levy that is less than the school 
 43.31  district would have been authorized to levy under the remainder 
 43.32  of Minnesota Statutes, section 124.912, subdivision 9, may be 
 43.33  levied over a four-year period notwithstanding the three-year 
 43.34  limitation of Minnesota Statutes, section 124.912, subdivision 
 43.35  9, paragraph (b). 
 43.36     Sec. 53.  [OPERATING DEBT LEVIES.] 
 44.1      Notwithstanding Minnesota Statutes, section 122.531, 
 44.2   subdivision 4a; 124.914; or Laws 1992, chapter 499, article 7, 
 44.3   sections 25 and 26, a school district's levy as otherwise 
 44.4   authorized under those sections for the 1996-1997 school year 
 44.5   shall be no greater than it was for the prior year.  To the 
 44.6   extent this prevents a district from amortizing its 
 44.7   reorganization operating debt as defined in Minnesota Statutes, 
 44.8   section 121.915, clause (1), in five years, the district shall 
 44.9   be permitted to levy the remainder in a subsequent year. 
 44.10     Sec. 54.  [HEALTH INSURANCE BENEFITS LEVY.] 
 44.11     Notwithstanding Minnesota Statutes, section 124.916, 
 44.12  subdivision 1, or Laws 1993, chapter 224, article 8, section 18, 
 44.13  a school district's levy for retired employees health insurance 
 44.14  as otherwise authorized under those provisions of law for the 
 44.15  taxes payable in 1996 shall be no greater than it was for the 
 44.16  prior year. 
 44.17     Sec. 55.  [RETIREMENT LEVY.] 
 44.18     Notwithstanding Minnesota Statutes, section 124.916, 
 44.19  subdivision 3, a school district's levy as otherwise authorized 
 44.20  under that subdivision for taxes payable in 1996 shall be no 
 44.21  greater than it was for the prior year.  If the resulting levy 
 44.22  is less than the school district would have been authorized to 
 44.23  levy under that subdivision, the school district shall receive 
 44.24  additional aid equal to the difference. 
 44.25     Sec. 56.  [MINNEAPOLIS HEALTH INSURANCE SUBSIDY.] 
 44.26     Notwithstanding Minnesota Statutes, section 124.916, 
 44.27  subdivision 4, a school district's levy as otherwise authorized 
 44.28  under that section for the 1996-1997 school year shall be no 
 44.29  greater than it was for the prior year. 
 44.30     Sec. 57.  [LEVY FOR TACONITE PAYMENT.] 
 44.31     Notwithstanding Minnesota Statutes, section 124.918, 
 44.32  subdivision 8, a school district's levy reduction as otherwise 
 44.33  authorized under that subdivision for the 1996-1997 school year 
 44.34  shall be no less than it was for the prior year.  General 
 44.35  education aid reduction for the 1996-1997 school year shall be 
 44.36  governed by Minnesota Statutes, section 124A.035, subdivision 5, 
 45.1   and the levy reduction as dictated by this section. 
 45.2      Sec. 58.  [EQUALIZED DEBT SERVICE LEVY.] 
 45.3      Notwithstanding Minnesota Statutes, section 124.95, 
 45.4   subdivision 4, a school district's levy as otherwise authorized 
 45.5   under that subdivision for the 1996-1997 school year taxes 
 45.6   payable in 1996 shall be based on the actual pupil units in the 
 45.7   district for the 1992-1993 school year and the 1993 adjusted net 
 45.8   tax of the district. 
 45.9      Sec. 59.  [UNEQUALIZED REFERENDUM LEVY.] 
 45.10     Notwithstanding Minnesota Statutes, section 124A.03, 
 45.11  subdivision 1i, a school district's unequalized referendum levy 
 45.12  for the 1996-1997 school year shall be no greater than it was 
 45.13  for the prior year.  If the resulting levy is less than the 
 45.14  school district would have levied under that subdivision, the 
 45.15  school district shall receive additional aid equal to the 
 45.16  difference. 
 45.17     Sec. 60.  [REFERENDUM LEVY.] 
 45.18     (a) Except as provided in paragraph (b) or (c), 
 45.19  notwithstanding Minnesota Statutes, section 124A.03, subdivision 
 45.20  2 or 2b, or 124B.03, subdivision 2, no referendum conducted 
 45.21  after March 30, 1995, under those sections may authorize a levy 
 45.22  first becoming payable in 1996.  
 45.23     (b) A referendum may authorize such a levy if the 
 45.24  referendum provides for continuation of a referendum levy that 
 45.25  terminates beginning with taxes payable in 1996.  If the 
 45.26  terminated levy had been based on net tax capacity, the 
 45.27  referendum relating to taxes payable in 1996 must be based on 
 45.28  net tax capacity and the ballot shall state the estimated 
 45.29  referendum tax rate based on net tax capacity for taxes levied 
 45.30  in 1996, notwithstanding Minnesota Statutes, section 124A.03, 
 45.31  subdivisions 2 and 2a.  To the extent the referendum relates to 
 45.32  taxes payable in 1997 and subsequent years, the levies for those 
 45.33  years are subject to Minnesota Statutes, sections 124A.03, 
 45.34  subdivision 2a, and 124A.0311, subdivision 3, and the ballot 
 45.35  shall also state the estimated referendum tax rate as a 
 45.36  percentage of market value for taxes levied in 1997. 
 46.1      (c) A referendum may authorize such a levy if the levy 
 46.2   required under the referendum would not result in an increase 
 46.3   for taxes payable in 1996 in the total levy for all purposes 
 46.4   imposed by the school district over the total levy imposed by 
 46.5   the district for taxes payable in 1995. 
 46.6      Sec. 61.  [REFERENDUM AUTHORITY; CONVERSION.] 
 46.7      Notwithstanding Minnesota Statutes, section 124A.0311, 
 46.8   subdivisions 2 and 3, no school district may convert its 
 46.9   referendum authority currently authorized to be levied against 
 46.10  net tax capacity to referendum authority authorized to be levied 
 46.11  against referendum market value effective for taxes payable in 
 46.12  1996. 
 46.13     Sec. 62.  [TRAINING AND EXPERIENCE LEVY.] 
 46.14     Notwithstanding Minnesota Statutes, section 124A.22, 
 46.15  subdivision 4a, a school district's training and experience levy 
 46.16  for the 1996-1997 school year shall be no greater than it was 
 46.17  for the prior year. 
 46.18     Sec. 63.  [SUPPLEMENTAL LEVY.] 
 46.19     Notwithstanding Minnesota Statutes, section 124A.22, 
 46.20  subdivision 8a, a school district's supplemental levy for the 
 46.21  1996-1997 school year shall be no greater than it was for the 
 46.22  prior year. 
 46.23     Sec. 64.  [GENERAL EDUCATION LEVY; OFF-FORMULA DISTRICTS.] 
 46.24     Notwithstanding Minnesota Statutes, section 124A.23, 
 46.25  subdivision 3, an off-formula school district's levy for general 
 46.26  education for the 1996-1997 school year shall be no greater than 
 46.27  it was for the prior year.  An off-formula school district's aid 
 46.28  reduction for general education levy equity under Minnesota 
 46.29  Statutes, section 124A.24, shall be computed using the levy 
 46.30  computed under this section.  If an off-formula district 
 46.31  payments pursuant to Minnesota Statutes, section 124A.035, 
 46.32  subdivision 4, are reduced from that received in the prior 
 46.33  school year, the district shall receive additional aid equal to 
 46.34  the difference. 
 46.35     Sec. 65.  [LEVY REDUCTION.] 
 46.36     Notwithstanding Minnesota Statutes, section 124A.26, 
 47.1   subdivision 2, a district's levy reduction for the 1996-1997 
 47.2   school year under that subdivision shall be no less than it was 
 47.3   in the prior year.  To the extent that the resulting reduction 
 47.4   is greater than the school district would have otherwise 
 47.5   received under that subdivision, the school district shall 
 47.6   receive additional aid equal to the difference. 
 47.7      Sec. 66.  [STAFF DEVELOPMENT LEVY.] 
 47.8      Notwithstanding Minnesota Statutes, section 124A.292, 
 47.9   subdivision 3, a school district's levy for staff development 
 47.10  for the 1996-1997 school year shall be no greater than it was 
 47.11  for the prior year. 
 47.12     Sec. 67.  [SCHOOL RESTRUCTURING LEVIES.] 
 47.13     Notwithstanding Minnesota Statutes, section 126.019, a 
 47.14  school district's levy under that section for taxes payable in 
 47.15  1996 shall be no greater than it was in the prior year.  To the 
 47.16  extent the resulting levy is less than the district would have 
 47.17  otherwise been authorized to levy under that section, the 
 47.18  district shall receive additional aid equal to the difference. 
 47.19     Sec. 68.  [LEVY FOR LOCAL SHARE OF TECHNICAL COLLEGE 
 47.20  CONSTRUCTION.] 
 47.21     Notwithstanding Minnesota Statutes, section 136C.411, the 
 47.22  levy as otherwise authorized under that section for the 
 47.23  1996-1997 school year shall be no greater than it was for the 
 47.24  prior year.  If the resulting levy is less than is necessary for 
 47.25  the district to pay its local share of the costs of construction 
 47.26  in that year, the joint vocational technical district shall 
 47.27  receive additional aid equal to the difference. 
 47.28     Sec. 69.  [JOINT VOCATIONAL TECHNICAL DISTRICT TAX LEVY.] 
 47.29     Notwithstanding Minnesota Statutes, section 136C.67, a 
 47.30  joint vocational technical district's levy under that 
 47.31  subdivision for the 1996-1997 school year shall be no greater 
 47.32  than it was for the prior year. 
 47.33     Sec. 70.  [LEVY ADJUSTMENT.] 
 47.34     Notwithstanding any other law to the contrary, any 
 47.35  adjustment of a school district's levy authority other than for 
 47.36  debt redemption fund excesses under Minnesota Statutes, section 
 48.1   475.61, for taxes payable in 1996 shall not result in a levy 
 48.2   that is greater than it was in 1995.  If the resulting levy 
 48.3   adjustments reduce the district's revenues below that which the 
 48.4   district would have otherwise received in the absence of this 
 48.5   section, the district will receive additional aid equal to the 
 48.6   difference. 
 48.7      Sec. 71.  [OTHER LEVY AUTHORITY.] 
 48.8      A school district's levy under any special law or any 
 48.9   authority other than that contained in Minnesota Statutes, 
 48.10  chapters 124, 124A, and 136C, shall not be greater for taxes 
 48.11  payable in 1996 than it was for taxes payable in 1995 except for 
 48.12  any debt service on obligations, certificates of indebtedness, 
 48.13  capital notes, or other debt instruments issued prior to March 
 48.14  30, 1995, or to make payments on installment purchase contracts 
 48.15  or lease purchase agreements entered into prior to March 30, 
 48.16  1995. 
 48.17     Sec. 72.  [BENEFIT RATIO FOR RURAL SERVICE DISTRICTS.] 
 48.18     Notwithstanding Minnesota Statutes, section 272.67, 
 48.19  subdivision 6, the benefit ratio used for apportioning levies to 
 48.20  a rural service district for taxes payable in 1996 shall not be 
 48.21  greater than that in effect for taxes payable in 1995. 
 48.22     Sec. 73.  [PROHIBITION AGAINST INCURRING NEW DEBT.] 
 48.23     Subdivision 1.  [GENERALLY.] (a) After March 30, 1995, no 
 48.24  municipality as defined in Minnesota Statutes, section 475.51, 
 48.25  or any special taxing district as defined under Minnesota 
 48.26  Statutes, section 275.066, may sell obligations, certificates of 
 48.27  indebtedness, or capital notes under Minnesota Statutes, chapter 
 48.28  475, section 412.301, or any other law authorizing obligations, 
 48.29  certificates of indebtedness, capital notes, or other debt 
 48.30  instruments or enter into installment purchase contracts or 
 48.31  lease purchase agreements under Minnesota Statutes, section 
 48.32  465.71, or any other law authorizing installment purchase 
 48.33  contracts or lease purchase agreements if issuing those debt 
 48.34  instruments or entering into those contracts would require a 
 48.35  levy first becoming due in 1996.  This restriction does not 
 48.36  apply to (1) refunding bonds sold to refund bonds originally 
 49.1   sold before March 30, 1995, or (2) obligations for which the 
 49.2   amount of the levy first becoming due in 1996 would not exceed 
 49.3   the amount by which the municipality's total debt service levy 
 49.4   for taxes payable in 1996 prior to issuance of those obligations 
 49.5   is less than the municipality's total debt service levy for 
 49.6   taxes payable in 1995.  As used in clause (2), "obligations" 
 49.7   includes certificates of indebtedness, capital notes, or other 
 49.8   debt instruments or installment purchase contracts or lease 
 49.9   purchase agreements.  
 49.10     (b) For purposes of this section, bonds will be deemed to 
 49.11  have been sold before March 30, 1995, if: 
 49.12     (1) an agreement has been entered into between the 
 49.13  municipality and a purchaser or underwriter for the sale of the 
 49.14  bonds by that date; 
 49.15     (2) the issuing municipality is a party to contract or 
 49.16  letter of understanding entered into before March 30, 1995, with 
 49.17  the federal government or the state government that requires the 
 49.18  municipality to pay for a project, and the project will be 
 49.19  funded with the proceeds of the bonds; or 
 49.20     (3) the proceeds of the bonds will be used to fund a 
 49.21  project or acquisition with respect to which the municipality 
 49.22  has entered into a contract with a builder or supplier before 
 49.23  March 30.  Debt service payments due on bonds described in this 
 49.24  paragraph during calendar year 1996 will be paid by the state.  
 49.25  The amount of those payments must be repaid by the municipality 
 49.26  to the state in three equal annual installments beginning in 
 49.27  1997.  No interest will be due on those payments if timely paid 
 49.28  by June 15 of the year due. 
 49.29     Subd. 2.  [EXCEPTION.] Notwithstanding subdivision 1, 
 49.30  certificates of indebtedness, capital notes, installment 
 49.31  purchase contracts, lease purchase agreements or any other debt 
 49.32  instruments, and the debt service levies for the obligations 
 49.33  shall, for purposes of this act, be treated as if sold prior to 
 49.34  March 30, 1995, if: 
 49.35     (a) The municipality or other governmental authority has 
 49.36  satisfied any one of the following conditions prior to March 30, 
 50.1   1995: 
 50.2      (1) it has adopted a resolution or ordinance authorizing 
 50.3   the issuance of the obligations; 
 50.4      (2) it has declared official intent to issue the 
 50.5   obligations under federal tax laws and regulations; or 
 50.6      (3) it has entered into a binding agreement to design or 
 50.7   construct a project or acquire property to be financed with the 
 50.8   obligations; and 
 50.9      (b) The municipality makes a finding at the time of the 
 50.10  sale of the bonds that no levy will be required for taxes 
 50.11  payable in 1996 to pay the debt service on the obligations 
 50.12  because sufficient funds are available from nonproperty tax 
 50.13  sources to pay the debt service. 
 50.14     Sec. 74.  [ASSESSMENT LIMITATIONS.] 
 50.15     Subdivision 1.  [1995 ASSESSMENT.] Notwithstanding 
 50.16  Minnesota Statutes, section 273.11, or any other law to the 
 50.17  contrary, the value of property for the 1995 assessment shall 
 50.18  not exceed the lesser of its limited market value determined for 
 50.19  the 1994 assessment pursuant to Minnesota Statutes, section 
 50.20  273.11, subdivision 1a, or its market value as otherwise 
 50.21  determined for the 1994 assessment provided that any value 
 50.22  attributable to new construction or improvements to the extent 
 50.23  it does not qualify for deferral under Minnesota Statutes, 
 50.24  section 273.11, subdivision 16, shall be added to the prior 
 50.25  year's value used to determine its tax capacity.  It is further 
 50.26  provided that previously tax exempt property that loses its tax 
 50.27  exempt status pursuant to Minnesota Statutes, section 272.02, 
 50.28  subdivision 4, shall not have its assessment limited in any way 
 50.29  under this subdivision. 
 50.30     Subd. 2.  [1996 ASSESSMENT.] The provisions of Minnesota 
 50.31  Statutes, section 273.11, subdivision 1a, shall govern in 
 50.32  determining the value of property classified as agricultural 
 50.33  homestead or nonhomestead, residential homestead or 
 50.34  nonhomestead, or noncommercial seasonal residential for the 1996 
 50.35  assessment provided that "five percent" shall be substituted for 
 50.36  "ten percent" in that section. 
 51.1      Sec. 75.  [LEVY LIMITATION TAXES PAYABLE IN 1996.] 
 51.2      Subdivision 1.  [TAXES PAYABLE IN 1996 PROPOSED LEVY.] 
 51.3   Notwithstanding any other law to the contrary, for purposes of 
 51.4   the certification required by Minnesota Statutes, section 
 51.5   275.065, subdivision 1, in 1995, no taxing authority other than 
 51.6   a school district shall certify to the county auditor a proposed 
 51.7   property tax levy or in the case of a township, a final property 
 51.8   tax levy, greater than the amount certified to the county 
 51.9   auditor pursuant to Minnesota Statutes, section 275.07, 
 51.10  subdivision 1, in the prior year except as provided in 
 51.11  subdivisions 3, 4, and 5. 
 51.12     Subd. 2.  [TAXES PAYABLE IN 1996 FINAL LEVY.] 
 51.13  Notwithstanding any other law to the contrary, for purposes of 
 51.14  the certification required by Minnesota Statutes, section 
 51.15  275.07, subdivision 1, in 1995, no taxing authority other than a 
 51.16  school district shall certify to the county auditor a property 
 51.17  tax levy greater than the amount certified to the county auditor 
 51.18  pursuant to Minnesota Statutes, section 275.07, subdivision 1, 
 51.19  in the prior year except as provided in subdivisions 3 and 4. 
 51.20     Subd. 3.  [SCHOOL DISTRICTS.] School district levies shall 
 51.21  be governed by sections 10 to 71. 
 51.22     Subd. 4.  [DEBT SERVICE EXCEPTION.] If a payable 1996 levy 
 51.23  for debt service on obligations, certificates of indebtedness, 
 51.24  capital notes, or other debt instruments sold prior to March 30, 
 51.25  1995, or to make payments on installment purchase contracts or 
 51.26  lease purchase agreements entered into prior to March 30, 1995, 
 51.27  exceeds the levy a taxing authority certified pursuant to 
 51.28  Minnesota Statutes, section 275.07, subdivision 1, for taxes 
 51.29  payable in 1995 for the same purpose, the excess may be levied 
 51.30  notwithstanding the limitations of subdivisions 1 and 2. 
 51.31     Subd. 5.  [ANNEXATION EXCEPTION.] The city tax rate for 
 51.32  taxes payable in 1996 on any property annexed under chapter 414 
 51.33  may not be increased over the city or township tax rate in 
 51.34  effect on the property in 1995, notwithstanding any law, 
 51.35  municipal board order, or ordinance to the contrary.  The limit 
 51.36  on the annexing city's levy under subdivisions 1 and 2 may be 
 52.1   increased in excess of that limit by an amount equal to the net 
 52.2   tax capacity of the property annexed times the city or township 
 52.3   tax rate in effect on that property for taxes payable in 1995.  
 52.4   The levy limit of the city or township from which the property 
 52.5   was annexed shall be reduced by the same amount. 
 52.6      Sec. 76.  [FREEZE ON LOCAL MATCH REQUIREMENTS.] 
 52.7      Notwithstanding any other law to the contrary, the local 
 52.8   funding or local match required from any city, town, or county 
 52.9   for any state grant or program shall not be increased for 
 52.10  calendar year 1996 above the dollar amount of the local funding 
 52.11  or local match required for the same grant or program in 1995, 
 52.12  regardless of the level of state funding provided; and any new 
 52.13  local match or local funding requirements for new or amended 
 52.14  state grants or programs shall not be effective until calendar 
 52.15  year 1997.  Nothing in this section shall affect the eligibility 
 52.16  of a city, town, or county, for the receipt of state grants or 
 52.17  program funds in 1996 or reduce the amount of state funding a 
 52.18  city, town, or county would otherwise receive in 1996 if the 
 52.19  local match requirements of the state grant or program were met 
 52.20  in 1996. 
 52.21     Sec. 77.  [SUSPENSION OF SALARY AND BUDGET APPEAL 
 52.22  AUTHORIZATION.] 
 52.23     After April 11, 1995, no county sheriff may exercise the 
 52.24  authority granted under Minnesota Statutes, section 387.20, 
 52.25  subdivision 7, and no county attorney may exercise the authority 
 52.26  granted under Minnesota Statutes, section 388.18, subdivision 6, 
 52.27  to the extent that the salary or budget increase sought in the 
 52.28  appeal would result in an increase in county expenditures in 
 52.29  calendar year 1996. 
 52.30     Sec. 78.  [SUSPENSION OF PUBLICATION AND HEARING 
 52.31  REQUIREMENTS.] 
 52.32     A local taxing authority is not required to comply with the 
 52.33  public advertisement notice of Minnesota Statutes, section 
 52.34  275.065, subdivision 5a, or the public hearing requirement of 
 52.35  Minnesota Statutes, section 275.065, subdivision 6, with respect 
 52.36  to taxes levied in 1995, payable in 1996, only. 
 53.1      Sec. 79.  [LEVY LIMITATION TAXES PAYABLE IN 1997.] 
 53.2      Subdivision 1.  [DEFINITION.] The "percentage increase in 
 53.3   the implicit price deflator" means the percentage change in the 
 53.4   implicit price deflator for state and local governments 
 53.5   purchases of goods and services as calculated in Minnesota 
 53.6   Statutes, section 477A.03, subdivision 3, provided that the 2.5 
 53.7   percent and five percent limits do not apply and that the 
 53.8   increase can not be less than zero percent. 
 53.9      Subd. 2.  [TAXES PAYABLE IN 1997 PROPOSED LEVY.] 
 53.10  Notwithstanding any other law to the contrary, for purposes of 
 53.11  the certification required by Minnesota Statutes, section 
 53.12  275.065, subdivision 1, in 1996, no taxing authority other than 
 53.13  a school district or a joint vocational technical district shall 
 53.14  certify to the county auditor a proposed property tax levy or in 
 53.15  the case of a township, a final property tax levy, that is 
 53.16  greater than the product of: 
 53.17     (1) the sum of one plus the lesser of (i) three percent, or 
 53.18  (ii) the percentage increase in the implicit price deflator; and 
 53.19     (2) the amount certified to the county auditor pursuant to 
 53.20  Minnesota Statutes, section 275.07, subdivision 1, in the prior 
 53.21  year, except as provided in subdivisions 4 and 5. 
 53.22     Subd. 3.  [TAXES PAYABLE IN 1997 FINAL LEVY.] 
 53.23  Notwithstanding any other law to the contrary, for purposes of 
 53.24  the certification required by Minnesota Statutes, section 
 53.25  275.07, subdivision 1, in 1996, no taxing authority other than a 
 53.26  school district or a joint vocational technical district shall 
 53.27  certify to the county auditor a property tax levy that is 
 53.28  greater than the product of: 
 53.29     (1) the sum of one plus the lesser of (i) three percent, or 
 53.30  (ii) the percentage increase in the implicit price deflator; and 
 53.31     (2) the amount certified to the county auditor pursuant to 
 53.32  Minnesota Statutes, section 275.07, subdivision 1, in the prior 
 53.33  year, except as provided in subdivisions 4, 5, and 6. 
 53.34     Subd. 4.  [REFERENDA.] (a) A taxing authority other than a 
 53.35  school district or an education district may increase its levy 
 53.36  above the limits provided in subdivisions 2 and 3, by the amount 
 54.1   approved by the voters residing in the jurisdiction of the 
 54.2   authority at a referendum called for the purpose.  The 
 54.3   referendum may be called by the governing body or shall be 
 54.4   called by the governing body upon written petition of qualified 
 54.5   voters of the jurisdiction.  The referendum shall be conducted 
 54.6   during the calendar year before the increased levy authority, if 
 54.7   approved, first becomes payable.  Only one election to approve 
 54.8   an increase may be held in a calendar year.  The referendum must 
 54.9   be held on the first Tuesday after the first Monday in 
 54.10  November.  The ballot shall state the maximum amount of the 
 54.11  increased levy and the estimated referendum tax rate as a 
 54.12  percentage of taxable net tax capacity in the year it is to be 
 54.13  levied.  The ballot may contain a textual portion with the 
 54.14  information required in this subdivision and a question stating 
 54.15  substantially the following: 
 54.16     "Shall the increase in the levy proposed by (petition to) 
 54.17  the governing body of ........., be approved?" 
 54.18     (b) The governing body shall prepare and deliver by first 
 54.19  class mail at least 15 days but no more than 30 days prior to 
 54.20  the day of the referendum to each taxpayer a notice of the 
 54.21  referendum and the proposed levy increase.  The governing body 
 54.22  need not mail more than once notice to any taxpayer.  For the 
 54.23  purpose of giving mailed notice under this subdivision, owners 
 54.24  shall be those shown to be owners on the records of the county 
 54.25  auditor or, in any county where tax statements are mailed by the 
 54.26  county treasurer, on the records of the county treasurer.  Every 
 54.27  property owner whose name does not appear on the records of the 
 54.28  county auditor or the county treasurer shall be deemed to have 
 54.29  waived this mailed notice unless the owner has requested in 
 54.30  writing that the county auditor or county treasurer, as the case 
 54.31  may be, include the name on the records for this purpose.  The 
 54.32  notice must project the anticipated amount of tax increase in 
 54.33  annual dollars and annual percentage for typical residential 
 54.34  homesteads, agricultural homesteads, apartments, and 
 54.35  commercial-industrial property within the jurisdiction of the 
 54.36  taxing authority. 
 55.1      The notice must include the following statement:  "Passage 
 55.2   of this referendum will result in an increase in your property 
 55.3   taxes." 
 55.4      (c) A petition authorized by paragraph (a) shall be 
 55.5   effective if signed by a number of qualified voters in excess of 
 55.6   15 percent of the registered voters of the jurisdiction of the 
 55.7   taxing authority on the day the petition is filed with the 
 55.8   governing body.  A referendum invoked by petition shall be held 
 55.9   on the date specified in paragraph (a). 
 55.10     (d) The approval of 50 percent plus one of those voting on 
 55.11  the question is required to pass a referendum authorized by this 
 55.12  subdivision. 
 55.13     (e) A bond authorization under Minnesota Statutes, section 
 55.14  475.59, shall be deemed to meet the requirements of this 
 55.15  subdivision provided the ballot includes the information 
 55.16  required in paragraph (a) and the notice required in paragraph 
 55.17  (b) is distributed. 
 55.18     Subd. 5.  [DEBT SERVICE EXCEPTION.] If a payable 1997 levy 
 55.19  for debt service on obligations, certificates of indebtedness, 
 55.20  capital notes, or other debt instruments sold prior to March 30, 
 55.21  1995, or to make payments on installment purchase contracts or 
 55.22  lease purchase agreements entered into prior to March 30, 1995, 
 55.23  exceeds the levy a taxing authority certified pursuant to 
 55.24  Minnesota Statutes, section 275.07, subdivision 1, for taxes 
 55.25  payable in 1996 for the same purpose, or a payable 1997 levy for 
 55.26  general obligations exceeds any payable 1997 levy required as a 
 55.27  condition for the issuance of such general obligations, the 
 55.28  excess may be levied notwithstanding the limitations of 
 55.29  subdivisions 2 and 3. 
 55.30     Subd. 6.  [LEVY OF TOWN BEING MERGED INTO CITY.] If a town 
 55.31  has entered into an agreement to merge with a home rule charter 
 55.32  or statutory city, and the merger has been approved by a 
 55.33  referendum conducted under Minnesota Statutes, section 465.84, 
 55.34  the town's levy for taxes payable in 1997 shall not exceed the 
 55.35  greater of (1) the amount determined under subdivisions 1 to 5, 
 55.36  or (2) the amount established as a term of the merger agreement 
 56.1   with the city. 
 56.2      Sec. 80.  [FISCAL DISPARITIES FREEZE.] 
 56.3      Notwithstanding Minnesota Statutes, section 473F.08, 
 56.4   subdivision 2, clause (a), the amount to be deducted from a 
 56.5   governmental unit's net tax capacity for taxes payable in 1996 
 56.6   under that clause shall equal the amount deducted for taxes 
 56.7   payable in 1995.  Notwithstanding Minnesota Statutes, section 
 56.8   473F.08, subdivision 2, clause (b), the amount to be added to a 
 56.9   governmental unit's net tax capacity for taxes payable in 1996 
 56.10  under that clause shall equal the same amount added for taxes 
 56.11  payable in 1995.  Notwithstanding Minnesota Statutes, section 
 56.12  473F.08, subdivision 3, the areawide portion of the levy for 
 56.13  each governmental unit shall be determined using the local tax 
 56.14  rate for the 1993 levy year.  Notwithstanding Minnesota 
 56.15  Statutes, section 473F.08, subdivision 6, the portion of 
 56.16  commercial-industrial property within a municipality subject to 
 56.17  the areawide tax rate shall be computed using the amount 
 56.18  determined under Minnesota Statutes, sections 473F.06 and 
 56.19  473F.07, for taxes payable in 1995. 
 56.20     Sec. 81.  [TAX RATE FREEZE.] 
 56.21     Subdivision 1.  [REDUCTION OF LEVY; PAYMENT.] If in the 
 56.22  course of determining local tax rates for taxes payable in 1996 
 56.23  after reductions for disparity reduction aid under Minnesota 
 56.24  Statutes, section 275.08, subdivisions 1c and 1d, the county 
 56.25  auditor finds the local tax rate exceeds that in effect for 
 56.26  taxes payable in 1995, the county auditor shall reduce the local 
 56.27  government's levy so the local tax rate does not exceed that in 
 56.28  effect for taxes payable in 1995.  The difference between the 
 56.29  levy as originally certified by the local government and the 
 56.30  reduced levy shall be certified to the commissioner of revenue 
 56.31  at the time the abstracts are submitted under Minnesota 
 56.32  Statutes, section 275.29.  That amount shall be paid to the 
 56.33  local government on or before August 31. 
 56.34     Subd. 2.  [APPROPRIATION.] An amount sufficient to pay the 
 56.35  aid provided for under this section is appropriated from the 
 56.36  general fund to the commissioner of revenue for payment to 
 57.1   counties, cities, townships, and special taxing districts.  An 
 57.2   amount sufficient to pay the aid provided for under this section 
 57.3   is appropriated from the general fund to the commissioner of 
 57.4   education for payment to school districts. 
 57.5      Sec. 82.  [PENSION LIABILITIES.] 
 57.6      Notwithstanding any other law or charter provision to the 
 57.7   contrary, no levy for taxes payable in 1996 for a local police 
 57.8   and fire relief association for the purpose of amortizing an 
 57.9   unfunded pension liability may exceed the levy for that purpose 
 57.10  for taxes payable in 1995. 
 57.11     Sec. 83.  [DUTIES OF TOWNSHIP BOARD OF SUPERVISORS.] 
 57.12     Notwithstanding Minnesota Statutes, section 365.10, in 1995 
 57.13  the township board of supervisors shall adjust the levy and in 
 57.14  1996 the township board of supervisors may adjust the 
 57.15  expenditures of a township below the level authorized by the 
 57.16  electors to adjust for any reduction in the previously 
 57.17  authorized levy of the township pursuant to section 75. 
 57.18     Sec. 84.  [PROPERTY TAX AND EDUCATION AIDS REFORM.] 
 57.19     Subdivision 1.  [RECOMMENDED PROGRAM.] The legislative 
 57.20  commission on planning and fiscal policy shall prepare and 
 57.21  recommend to the legislature a property tax reform and education 
 57.22  aids reform program that includes: 
 57.23     (1) a property tax classification and class rate system; 
 57.24     (2) elementary and secondary education aids and levies; and 
 57.25     (3) aids to local government. 
 57.26     Subd. 2.  [STANDARDS.] (a) The recommended program must 
 57.27  provide for accountability, equity, revenue adequacy, and 
 57.28  efficiency as provided in paragraphs (b) to (e). 
 57.29     (b) The recommended program must provide accountability by 
 57.30  being understandable to the taxpayer, by linking the costs of 
 57.31  services to the taxes paid for those services, and by 
 57.32  correlating the responsibility for raising revenues with the 
 57.33  ability to make spending decisions.  
 57.34     (c) The recommended program must provide equity by 
 57.35  minimizing large, short-term shifts in tax burdens, and by 
 57.36  ensuring that tax burdens and aids are progressive and related 
 58.1   to the ability to pay or raise revenue.  
 58.2      (d) The recommended program must provide for adequate 
 58.3   revenue by controlling costs and the need for increased revenue, 
 58.4   minimizing reductions or shifts in revenues available to local 
 58.5   governments to provide needed services, and directing aids to 
 58.6   meet needs and fund services based on established funding 
 58.7   priorities.  
 58.8      (e) The program must promote efficiency by providing stable 
 58.9   predictable property taxes and local government revenues that 
 58.10  are competitive with those of other states and areas so that 
 58.11  property taxes and aids have minimal impact on the economic 
 58.12  decisions of taxpayers.  
 58.13     Subd. 3.  [TASK FORCE.] The commission may designate a task 
 58.14  force to advise the commission in carrying out its duties under 
 58.15  this section.  The task force may include legislators, agency 
 58.16  and legislative staff, state and local governmental officials, 
 58.17  educators, and taxpayers and members of the public.  The task 
 58.18  force expires on January 1, 1997. 
 58.19     Subd. 4.  [SERVICES.] The commission may enter into 
 58.20  contracts for the professional and other services necessary to 
 58.21  carry out its duties under this section. 
 58.22     Subd. 5.  [REPORT.] The commission shall report its 
 58.23  recommendations to the legislature on or before January 1, 
 58.24  1997.  The report shall include proposed legislation to 
 58.25  implement the recommendations of the commission. 
 58.26     Sec. 85.  [UNFUNDED MANDATE PROHIBITION.] 
 58.27     Subdivision 1.  [DEFINITION.] As used in this section, 
 58.28  "state mandates" has the meaning given in Minnesota Statutes, 
 58.29  section 3.881. 
 58.30     Subd. 2.  [FUNDING OF THE COST OF MANDATES.] If the fiscal 
 58.31  note prepared by the commissioner of finance under Minnesota 
 58.32  Statutes, section 3.982, indicates that a new or expanded 
 58.33  mandate on a political subdivision in a bill introduced in the 
 58.34  legislature will impose a statewide cost on counties in excess 
 58.35  of $500,000 or a statewide cost on cities or townships in excess 
 58.36  of $250,000, the political subdivisions are not required to 
 59.1   implement the mandate unless the legislature, by appropriation 
 59.2   enacted before the mandate is required to be implemented, 
 59.3   provides reimbursement to the political subdivisions for the 
 59.4   costs incurred. 
 59.5      Sec. 86.  [SAVINGS CLAUSE.] 
 59.6      Notwithstanding the repealers in section 88 or any other 
 59.7   provision in this act to the contrary, nothing in this act 
 59.8   constitutes an impairment of any obligations, certificates of 
 59.9   indebtedness, capital notes, or other debt instruments, 
 59.10  including installment purchase contracts or lease purchase 
 59.11  agreements, issued before the date of final enactment of this 
 59.12  act, by a municipality as defined in Minnesota Statutes, section 
 59.13  469.174, subdivision 6, or a special taxing district as defined 
 59.14  in Minnesota Statutes, section 275.066.  
 59.15     Sec. 87.  [PIPESTONE COUNTY.] 
 59.16     Subdivision 1.  [BOND AUTHORIZATION.] The county of 
 59.17  Pipestone may issue its general obligation bonds in a principal 
 59.18  amount of not to exceed $598,000 to defray the expense of repair 
 59.19  and renovation of the county courthouse and courthouse annex.  
 59.20  The bonds shall be issued in accordance with Minnesota Statutes, 
 59.21  chapter 475.  No further election proceedings are required and 
 59.22  Minnesota Statutes, section 275.61, shall not apply. 
 59.23     Subd. 2.  [EFFECTIVE DATE.] This section takes effect the 
 59.24  day after the county board of Pipestone county complies with 
 59.25  Minnesota Statutes, section 645.021, subdivision 3. 
 59.26     Sec. 88.  [REPEALER.] 
 59.27     Subdivision 1.  Minnesota Statutes 1994, sections 124.01; 
 59.28  124.05; 124.06; 124.07; 124.76; 124.82; 124.829; 124.83; 124.84; 
 59.29  124.85; 124.86; 124.90; 124.91; 124.912; 124.914; 124.916; 
 59.30  124.918; 124.95; 124.961; 124.962; 124.97; 124A.02, subdivisions 
 59.31  16, 23, and 24; 124A.03, subdivisions 1b, 1c, 1d, 1e, 1f, 1g, 
 59.32  1h, and 1i; 124A.0311; 124A.032; 124A.04; 124A.22, subdivisions 
 59.33  1, 2, 3, 4, 4a, 4b, 6, 6a, 8, and 9; 124A.23; 124A.24; 124A.26, 
 59.34  subdivisions 1, 2, and 3; 124A.27; 124A.28; and 124A.29, 
 59.35  subdivision 2, are repealed.  Laws 1991, chapter 265, article 7, 
 59.36  section 35, is repealed. 
 60.1      Subd. 2.  Minnesota Statutes 1994, sections 273.13; 
 60.2   273.135; 273.136; 273.1391; 473F.001; 473F.01; 473F.02; 473F.03; 
 60.3   473F.05; 473F.06; 473F.07; 473F.08; 473F.09; 473F.10; 473F.11; 
 60.4   473F.13; 477A.011; 477A.012; 477A.0121; 477A.0122; 477A.013; 
 60.5   477A.0132; 477A.014; 477A.015; 477A.016; 477A.017; 477A.03; 
 60.6   477A.11; 477A.12; 477A.13; 477A.14; and 477A.15, are repealed. 
 60.7      Subd. 3.  [REPEALER.] Minnesota Statutes 1994, sections 
 60.8   245.48; and 256H.12, subdivision 3, are repealed. 
 60.9      Sec. 89.  [EFFECTIVE DATE.] 
 60.10     Sections 2 to 5 and 85, subdivision 3, are effective July 
 60.11  1, 1995.  Section 88, subdivision 2, is effective for taxes 
 60.12  payable in 1998, and section 88, subdivision 1, is effective for 
 60.13  the 1998-1999 school year, provided that if the legislature does 
 60.14  not pass and the governor does not approve legislation by the 
 60.15  conclusion of the 1997 session that states in its body that it 
 60.16  is replacing the provisions of the repealed chapters and 
 60.17  sections in section 88, the repealed chapters and sections are 
 60.18  reenacted. 
 60.19     Sections 10 to 71, and section 75, subdivision 3, will not 
 60.20  become effective if a bill styled as S.F. No. 944 is enacted 
 60.21  during the 1995 session of the legislature and that bill 
 60.22  provides for the imposition of levies by school districts for 
 60.23  taxes payable in 1996. 
 60.24                             ARTICLE 4
 60.25                           PROPERTY TAXES
 60.26     Section 1.  Minnesota Statutes 1994, section 216B.16, is 
 60.27  amended by adding a subdivision to read: 
 60.28     Subd. 6d.  [WIND ENERGY; PROPERTY TAX.] Contracts for the 
 60.29  purchase of electric energy produced by a wind energy conversion 
 60.30  system installed after June 1, 1995, and before January 1, 1997, 
 60.31  between a public utility and the owner or developer of the 
 60.32  system must provide for the public utility to be liable for 
 60.33  property taxes imposed on the system.  The commission shall 
 60.34  permit a public utility that is purchasing electricity produced 
 60.35  by a wind energy conversion system installed after June 1, 1995, 
 60.36  and before January 1, 1997, to recover in its rates payments 
 61.1   made by the public utility for property taxes paid on the system.
 61.2      Sec. 2.  Minnesota Statutes 1994, section 272.02, 
 61.3   subdivision 1, is amended to read: 
 61.4      Subdivision 1.  All property described in this section to 
 61.5   the extent herein limited shall be exempt from taxation: 
 61.6      (1) All public burying grounds. 
 61.7      (2) All public schoolhouses. 
 61.8      (3) All public hospitals. 
 61.9      (4) All academies, colleges, and universities, and all 
 61.10  seminaries of learning. 
 61.11     (5) All churches, church property, and houses of worship. 
 61.12     (6) Institutions of purely public charity except parcels of 
 61.13  property containing structures and the structures described in 
 61.14  section 273.13, subdivision 25, paragraph (c), clauses (1), (2), 
 61.15  and (3), or paragraph (d), other than those that qualify for 
 61.16  exemption under clause (25). 
 61.17     (7) All public property exclusively used for any public 
 61.18  purpose. 
 61.19     (8) Except for the taxable personal property enumerated 
 61.20  below, all personal property and the property described in 
 61.21  section 272.03, subdivision 1, paragraphs (c) and (d), shall be 
 61.22  exempt.  
 61.23     The following personal property shall be taxable:  
 61.24     (a) personal property which is part of an electric 
 61.25  generating, transmission, or distribution system or a pipeline 
 61.26  system transporting or distributing water, gas, crude oil, or 
 61.27  petroleum products or mains and pipes used in the distribution 
 61.28  of steam or hot or chilled water for heating or cooling 
 61.29  buildings and structures; 
 61.30     (b) railroad docks and wharves which are part of the 
 61.31  operating property of a railroad company as defined in section 
 61.32  270.80; 
 61.33     (c) personal property defined in section 272.03, 
 61.34  subdivision 2, clause (3); 
 61.35     (d) leasehold or other personal property interests which 
 61.36  are taxed pursuant to section 272.01, subdivision 2; 273.124, 
 62.1   subdivision 7; or 273.19, subdivision 1; or any other law 
 62.2   providing the property is taxable as if the lessee or user were 
 62.3   the fee owner; 
 62.4      (e) manufactured homes and sectional structures, including 
 62.5   storage sheds, decks, and similar removable improvements 
 62.6   constructed on the site of a manufactured home, sectional 
 62.7   structure, park trailer or travel trailer as provided in section 
 62.8   273.125, subdivision 8, paragraph (f); and 
 62.9      (f) flight property as defined in section 270.071.  
 62.10     (9) Personal property used primarily for the abatement and 
 62.11  control of air, water, or land pollution to the extent that it 
 62.12  is so used, and real property which is used primarily for 
 62.13  abatement and control of air, water, or land pollution as part 
 62.14  of an agricultural operation, as a part of a centralized 
 62.15  treatment and recovery facility operating under a permit issued 
 62.16  by the Minnesota pollution control agency pursuant to chapters 
 62.17  115 and 116 and Minnesota Rules, parts 7001.0500 to 7001.0730, 
 62.18  and 7045.0020 to 7045.1260, as a wastewater treatment facility 
 62.19  and for the treatment, recovery, and stabilization of metals, 
 62.20  oils, chemicals, water, sludges, or inorganic materials from 
 62.21  hazardous industrial wastes, or as part of an electric 
 62.22  generation system.  For purposes of this clause, personal 
 62.23  property includes ponderous machinery and equipment used in a 
 62.24  business or production activity that at common law is considered 
 62.25  real property. 
 62.26     Any taxpayer requesting exemption of all or a portion of 
 62.27  any real property or any equipment or device, or part thereof, 
 62.28  operated primarily for the control or abatement of air or water 
 62.29  pollution shall file an application with the commissioner of 
 62.30  revenue.  The equipment or device shall meet standards, rules, 
 62.31  or criteria prescribed by the Minnesota pollution control 
 62.32  agency, and must be installed or operated in accordance with a 
 62.33  permit or order issued by that agency.  The Minnesota pollution 
 62.34  control agency shall upon request of the commissioner furnish 
 62.35  information or advice to the commissioner.  On determining that 
 62.36  property qualifies for exemption, the commissioner shall issue 
 63.1   an order exempting the property from taxation.  The equipment or 
 63.2   device shall continue to be exempt from taxation as long as the 
 63.3   permit issued by the Minnesota pollution control agency remains 
 63.4   in effect. 
 63.5      (10) Wetlands.  For purposes of this subdivision, 
 63.6   "wetlands" means:  (i) land described in section 103G.005, 
 63.7   subdivision 18; (ii) land which is mostly under water, produces 
 63.8   little if any income, and has no use except for wildlife or 
 63.9   water conservation purposes, provided it is preserved in its 
 63.10  natural condition and drainage of it would be legal, feasible, 
 63.11  and economically practical for the production of livestock, 
 63.12  dairy animals, poultry, fruit, vegetables, forage and grains, 
 63.13  except wild rice; or (iii) land in a wetland preservation area 
 63.14  under sections 103F.612 to 103F.616.  "Wetlands" under items (i) 
 63.15  and (ii) include adjacent land which is not suitable for 
 63.16  agricultural purposes due to the presence of the wetlands, but 
 63.17  do not include woody swamps containing shrubs or trees, wet 
 63.18  meadows, meandered water, streams, rivers, and floodplains or 
 63.19  river bottoms.  Exemption of wetlands from taxation pursuant to 
 63.20  this section shall not grant the public any additional or 
 63.21  greater right of access to the wetlands or diminish any right of 
 63.22  ownership to the wetlands. 
 63.23     (11) Native prairie.  The commissioner of the department of 
 63.24  natural resources shall determine lands in the state which are 
 63.25  native prairie and shall notify the county assessor of each 
 63.26  county in which the lands are located.  Pasture land used for 
 63.27  livestock grazing purposes shall not be considered native 
 63.28  prairie for the purposes of this clause.  Upon receipt of an 
 63.29  application for the exemption provided in this clause for lands 
 63.30  for which the assessor has no determination from the 
 63.31  commissioner of natural resources, the assessor shall refer the 
 63.32  application to the commissioner of natural resources who shall 
 63.33  determine within 30 days whether the land is native prairie and 
 63.34  notify the county assessor of the decision.  Exemption of native 
 63.35  prairie pursuant to this clause shall not grant the public any 
 63.36  additional or greater right of access to the native prairie or 
 64.1   diminish any right of ownership to it. 
 64.2      (12) Property used in a continuous program to provide 
 64.3   emergency shelter for victims of domestic abuse, provided the 
 64.4   organization that owns and sponsors the shelter is exempt from 
 64.5   federal income taxation pursuant to section 501(c)(3) of the 
 64.6   Internal Revenue Code of 1986, as amended through December 31, 
 64.7   1992, notwithstanding the fact that the sponsoring organization 
 64.8   receives funding under section 8 of the United States Housing 
 64.9   Act of 1937, as amended. 
 64.10     (13) If approved by the governing body of the municipality 
 64.11  in which the property is located, property not exceeding one 
 64.12  acre which is owned and operated by any senior citizen group or 
 64.13  association of groups that in general limits membership to 
 64.14  persons age 55 or older and is organized and operated 
 64.15  exclusively for pleasure, recreation, and other nonprofit 
 64.16  purposes, no part of the net earnings of which inures to the 
 64.17  benefit of any private shareholders; provided the property is 
 64.18  used primarily as a clubhouse, meeting facility, or recreational 
 64.19  facility by the group or association and the property is not 
 64.20  used for residential purposes on either a temporary or permanent 
 64.21  basis. 
 64.22     (14) To the extent provided by section 295.44, real and 
 64.23  personal property used or to be used primarily for the 
 64.24  production of hydroelectric or hydromechanical power on a site 
 64.25  owned by the state or a local governmental unit which is 
 64.26  developed and operated pursuant to the provisions of section 
 64.27  103G.535. 
 64.28     (15) If approved by the governing body of the municipality 
 64.29  in which the property is located, and if construction is 
 64.30  commenced after June 30, 1983:  
 64.31     (a) a "direct satellite broadcasting facility" operated by 
 64.32  a corporation licensed by the federal communications commission 
 64.33  to provide direct satellite broadcasting services using direct 
 64.34  broadcast satellites operating in the 12-ghz. band; and 
 64.35     (b) a "fixed satellite regional or national program service 
 64.36  facility" operated by a corporation licensed by the federal 
 65.1   communications commission to provide fixed satellite-transmitted 
 65.2   regularly scheduled broadcasting services using satellites 
 65.3   operating in the 6-ghz. band. 
 65.4   An exemption provided by clause (15) shall apply for a period 
 65.5   not to exceed five years.  When the facility no longer qualifies 
 65.6   for exemption, it shall be placed on the assessment rolls as 
 65.7   provided in subdivision 4.  Before approving a tax exemption 
 65.8   pursuant to this paragraph, the governing body of the 
 65.9   municipality shall provide an opportunity to the members of the 
 65.10  county board of commissioners of the county in which the 
 65.11  facility is proposed to be located and the members of the school 
 65.12  board of the school district in which the facility is proposed 
 65.13  to be located to meet with the governing body.  The governing 
 65.14  body shall present to the members of those boards its estimate 
 65.15  of the fiscal impact of the proposed property tax exemption.  
 65.16  The tax exemption shall not be approved by the governing body 
 65.17  until the county board of commissioners has presented its 
 65.18  written comment on the proposal to the governing body or 30 days 
 65.19  have passed from the date of the transmittal by the governing 
 65.20  body to the board of the information on the fiscal impact, 
 65.21  whichever occurs first. 
 65.22     (16) Real and personal property owned and operated by a 
 65.23  private, nonprofit corporation exempt from federal income 
 65.24  taxation pursuant to United States Code, title 26, section 
 65.25  501(c)(3), primarily used in the generation and distribution of 
 65.26  hot water for heating buildings and structures.  
 65.27     (17) Notwithstanding section 273.19, state lands that are 
 65.28  leased from the department of natural resources under section 
 65.29  92.46. 
 65.30     (18) Electric power distribution lines and their 
 65.31  attachments and appurtenances, that are used primarily for 
 65.32  supplying electricity to farmers at retail.  
 65.33     (19) Transitional housing facilities.  "Transitional 
 65.34  housing facility" means a facility that meets the following 
 65.35  requirements.  (i) It provides temporary housing to individuals, 
 65.36  couples, or families.  (ii) It has the purpose of reuniting 
 66.1   families and enabling parents or individuals to obtain 
 66.2   self-sufficiency, advance their education, get job training, or 
 66.3   become employed in jobs that provide a living wage.  (iii) It 
 66.4   provides support services such as child care, work readiness 
 66.5   training, and career development counseling; and a 
 66.6   self-sufficiency program with periodic monitoring of each 
 66.7   resident's progress in completing the program's goals.  (iv) It 
 66.8   provides services to a resident of the facility for at least 
 66.9   three months but no longer than three years, except residents 
 66.10  enrolled in an educational or vocational institution or job 
 66.11  training program.  These residents may receive services during 
 66.12  the time they are enrolled but in no event longer than four 
 66.13  years.  (v) It is owned and operated or under lease from a unit 
 66.14  of government or governmental agency under a property 
 66.15  disposition program and operated by one or more organizations 
 66.16  exempt from federal income tax under section 501(c)(3) of the 
 66.17  Internal Revenue Code of 1986, as amended through December 31, 
 66.18  1992.  This exemption applies notwithstanding the fact that the 
 66.19  sponsoring organization receives financing by a direct federal 
 66.20  loan or federally insured loan or a loan made by the Minnesota 
 66.21  housing finance agency under the provisions of either Title II 
 66.22  of the National Housing Act or the Minnesota housing finance 
 66.23  agency law of 1971 or rules promulgated by the agency pursuant 
 66.24  to it, and notwithstanding the fact that the sponsoring 
 66.25  organization receives funding under Section 8 of the United 
 66.26  States Housing Act of 1937, as amended. 
 66.27     (20) Real and personal property, including leasehold or 
 66.28  other personal property interests, owned and operated by a 
 66.29  corporation if more than 50 percent of the total voting power of 
 66.30  the stock of the corporation is owned collectively by:  (i) the 
 66.31  board of regents of the University of Minnesota, (ii) the 
 66.32  University of Minnesota Foundation, an organization exempt from 
 66.33  federal income taxation under section 501(c)(3) of the Internal 
 66.34  Revenue Code of 1986, as amended through December 31, 1992, and 
 66.35  (iii) a corporation organized under chapter 317A, which by its 
 66.36  articles of incorporation is prohibited from providing pecuniary 
 67.1   gain to any person or entity other than the regents of the 
 67.2   University of Minnesota; which property is used primarily to 
 67.3   manage or provide goods, services, or facilities utilizing or 
 67.4   relating to large-scale advanced scientific computing resources 
 67.5   to the regents of the University of Minnesota and others. 
 67.6      (21) Wind energy conversion systems, as defined in section 
 67.7   216C.06, subdivision 12, installed after January 1, 1991, and 
 67.8   used as an electric power source. are exempt to the extent 
 67.9   provided in items (i) to (iii): 
 67.10     (i) systems installed after January 1, 1991, and before 
 67.11  January 1, 1995, are exempt; 
 67.12     (ii) systems installed on or after January 1, 1995, located 
 67.13  within the same county and owned by the same owner that produce 
 67.14  in aggregate two or less megawatts of electricity, as measured 
 67.15  by the nameplate rating, are exempt; 
 67.16     (iii) systems installed on or after January 1, 1995, 
 67.17  located within the same county and owned by the same owner that 
 67.18  produce in aggregate more than two megawatts of electricity, as 
 67.19  measured by the nameplate rating, are taxable to the following 
 67.20  extent:  
 67.21     (A) the foundation or pads are taxable upon installation; 
 67.22  and 
 67.23     (B) the devices in such a system that convert wind energy 
 67.24  to a form of usable energy and any supporting or protective 
 67.25  structures are exempt.  
 67.26     (22) Containment tanks, cache basins, and that portion of 
 67.27  the structure needed for the containment facility used to 
 67.28  confine agricultural chemicals as defined in section 18D.01, 
 67.29  subdivision 3, as required by the commissioner of agriculture 
 67.30  under chapter 18B or 18C. 
 67.31     (23) Photovoltaic devices, as defined in section 216C.06, 
 67.32  subdivision 13, installed after January 1, 1992, and used to 
 67.33  produce or store electric power. 
 67.34     (24) Real and personal property owned and operated by a 
 67.35  private, nonprofit corporation exempt from federal income 
 67.36  taxation pursuant to United States Code, title 26, section 
 68.1   501(c)(3), primarily used for an ice arena or ice rink, and used 
 68.2   primarily for youth and high school programs. 
 68.3      (25) A structure that is situated on real property that is 
 68.4   used for: 
 68.5      (i) housing for the elderly or for low- and moderate-income 
 68.6   families as defined in Title II of the National Housing Act, as 
 68.7   amended through December 31, 1990, and funded by a direct 
 68.8   federal loan or federally insured loan made pursuant to Title II 
 68.9   of the act; or 
 68.10     (ii) housing lower income families or elderly or 
 68.11  handicapped persons, as defined in section 8 of the United 
 68.12  States Housing Act of 1937, as amended. 
 68.13     In order for a structure to be exempt under (i) or (ii), it 
 68.14  must also meet each of the following criteria: 
 68.15     (A) is owned by an entity which is operated as a nonprofit 
 68.16  corporation organized under chapter 317A; 
 68.17     (B) is owned by an entity which has not entered into a 
 68.18  housing assistance payments contract under section 8 of the 
 68.19  United States Housing Act of 1937, or, if the entity which owns 
 68.20  the structure has entered into a housing assistance payments 
 68.21  contract under section 8 of the United States Housing Act of 
 68.22  1937, the contract provides assistance for less than 90 percent 
 68.23  of the dwelling units in the structure, excluding dwelling units 
 68.24  intended for management or maintenance personnel; 
 68.25     (C) operates an on-site congregate dining program in which 
 68.26  participation by residents is mandatory, and provides assisted 
 68.27  living or similar social and physical support services for 
 68.28  residents; and 
 68.29     (D) was not assessed and did not pay tax under chapter 273 
 68.30  prior to the 1991 levy, while meeting the other conditions of 
 68.31  this clause. 
 68.32     An exemption under this clause remains in effect for taxes 
 68.33  levied in each year or partial year of the term of its permanent 
 68.34  financing. 
 68.35     (26) Real and personal property that is located in the 
 68.36  Superior National Forest, and owned or leased and operated by a 
 69.1   nonprofit organization that is exempt from federal income 
 69.2   taxation under section 501(c)(3) of the Internal Revenue Code of 
 69.3   1986, as amended through December 31, 1992, and primarily used 
 69.4   to provide recreational opportunities for disabled veterans and 
 69.5   their families. 
 69.6      (27) Manure pits and appurtenances, which may include 
 69.7   slatted floors and pipes, installed or operated in accordance 
 69.8   with a permit, order, or certificate of compliance issued by the 
 69.9   Minnesota pollution control agency.  The exemption shall 
 69.10  continue for as long as the permit, order, or certificate issued 
 69.11  by the Minnesota pollution control agency remains in effect. 
 69.12     (28) Notwithstanding clause (8), item (a), attached 
 69.13  machinery and other personal property which is part of a 
 69.14  facility containing a cogeneration system as described in 
 69.15  section 216B.166, subdivision 2, paragraph (a), if the 
 69.16  cogeneration system has met the following criteria:  (i) the 
 69.17  system utilizes natural gas as a primary fuel and the 
 69.18  cogenerated steam initially replaces steam generated from 
 69.19  existing thermal boilers utilizing coal; (ii) the facility 
 69.20  developer is selected as a result of a procurement process 
 69.21  ordered by the public utilities commission; and (iii) 
 69.22  construction of the facility is commenced after July 1, 1994, 
 69.23  and before July 1, 1997. 
 69.24     (29) Real property acquired by a home rule charter city, 
 69.25  statutory city, county, town, or school district under a lease 
 69.26  purchase agreement or an installment purchase contract during 
 69.27  the term of the lease purchase agreement as long as and to the 
 69.28  extent that the property is used by the city, county, town, or 
 69.29  school district and devoted to a public use and to the extent it 
 69.30  is not subleased to any private individual, entity, association, 
 69.31  or corporation in connection with a business or enterprise 
 69.32  operated for profit. 
 69.33     Sec. 3.  Minnesota Statutes 1994, section 273.11, 
 69.34  subdivision 16, is amended to read: 
 69.35     Subd. 16.  [VALUATION EXCLUSION FOR CERTAIN IMPROVEMENTS.] 
 69.36  Improvements to homestead property made before January 2, 2003, 
 70.1   shall be fully or partially excluded from the value of the 
 70.2   property for assessment purposes provided that: 
 70.3      (1) the house is at least 35 years old at the time of the 
 70.4   improvement; and 
 70.5      (2) either: 
 70.6      (a) the assessor's estimated market value of the house on 
 70.7   January 2 of the current year is equal to or less than 
 70.8   $150,000,; or 
 70.9      (b) if the estimated market value of the house is over 
 70.10  $150,000 market value but is less than $300,000 on January 2 of 
 70.11  the current year, the property qualifies if: 
 70.12     (i) it is located in a city or town in which 50 percent or 
 70.13  more of the homes were constructed before 1960 based upon the 
 70.14  1990 federal census, and 
 70.15     (ii) the city or town's median family income based upon the 
 70.16  1990 federal census is less than the statewide median family 
 70.17  income based upon the 1990 federal census; or 
 70.18     (c) if the estimated market value of the house is over 
 70.19  $300,000 on January 2 of the current year, the property 
 70.20  qualifies if: 
 70.21     (i) it meets the qualifications of paragraph (b), items (i) 
 70.22  and (ii); and 
 70.23     (ii) it is located in a city of the first class within the 
 70.24  metropolitan area defined in section 473.121, subdivision 2. 
 70.25     Any house which has an estimated market value of $300,000 
 70.26  or more on January 2 of the current year is not eligible to 
 70.27  receive any property valuation exclusion under this section.  
 70.28  For purposes of determining this eligibility, "house" means land 
 70.29  and buildings.  
 70.30     The age of a residence is the number of years that the 
 70.31  residence has existed at its present site.  In the case of an 
 70.32  owner-occupied duplex or triplex, the improvement is eligible 
 70.33  regardless of which portion of the property was improved. 
 70.34     If the property lies in a jurisdiction which is subject to 
 70.35  a building permit process, a building permit must have been 
 70.36  issued prior to commencement of the improvement.  Any 
 71.1   improvement must add at least $1,000 to the value of the 
 71.2   property to be eligible for exclusion under this subdivision.  
 71.3   Only improvements to the structure which is the residence of the 
 71.4   qualifying homesteader or construction of or improvements to no 
 71.5   more than one two-car garage per residence qualify for the 
 71.6   provisions of this subdivision.  If an improvement was begun 
 71.7   between January 2, 1992, and January 2, 1993, any value added 
 71.8   from that improvement for the January 1994 and subsequent 
 71.9   assessments shall qualify for exclusion under this subdivision 
 71.10  provided that a building permit was obtained for the improvement 
 71.11  between January 2, 1992, and January 2, 1993.  Whenever a 
 71.12  building permit is issued for property currently classified as 
 71.13  homestead, the issuing jurisdiction shall notify the property 
 71.14  owner of the possibility of valuation exclusion under this 
 71.15  subdivision.  The assessor shall require an application, 
 71.16  including documentation of the age of the house from the owner, 
 71.17  if unknown by the assessor.  The application may be filed 
 71.18  subsequent to the date of the building permit provided that the 
 71.19  application is filed prior to the next assessment date. 
 71.20     After the adjournment of the 1994 county board of 
 71.21  equalization meetings, no exclusion may be granted for an 
 71.22  improvement by a local board of review or county board of 
 71.23  equalization unless (1) a building permit was issued prior to 
 71.24  the commencement of the improvement if the jurisdiction requires 
 71.25  a building permit, and (2) an application was completed on a 
 71.26  timely basis.  No abatement of the taxes for qualifying 
 71.27  improvements may be granted by a county board unless (1) a 
 71.28  building permit was issued prior to commencement of the 
 71.29  improvement if the jurisdiction requires a building permit, and 
 71.30  (2) an application was completed on a timely basis. 
 71.31     The assessor shall note the qualifying value of each 
 71.32  improvement on the property's record, and the sum of those 
 71.33  amounts shall be subtracted from the value of the property in 
 71.34  each year for ten years after the improvement has been made, at 
 71.35  which time an amount equal to 20 percent of the qualifying value 
 71.36  shall be added back in each of the five subsequent assessment 
 72.1   years.  The valuation exclusion shall terminate whenever (1) the 
 72.2   property is sold, or (2) the property is reclassified to a class 
 72.3   which does not qualify for treatment under this subdivision. 
 72.4   Improvements made by an occupant who is the purchaser of the 
 72.5   property under a conditional purchase contract do not qualify 
 72.6   under this subdivision unless the seller of the property is a 
 72.7   governmental entity.  The qualifying value of the property shall 
 72.8   be computed based upon the increase from that structure's market 
 72.9   value as of January 2 preceding the acquisition of the property 
 72.10  by the governmental entity. 
 72.11     The total qualifying value for a homestead may not exceed 
 72.12  $50,000.  The total qualifying value for a homestead with a 
 72.13  house that is less than 70 years old may not exceed $25,000.  
 72.14  The term "qualifying value" means the increase in estimated 
 72.15  market value resulting from the improvement if the improvement 
 72.16  occurs when the house is at least 70 years old, or one-half of 
 72.17  the increase in estimated market value resulting from the 
 72.18  improvement otherwise.  The $25,000 and $50,000 maximum 
 72.19  qualifying value under this subdivision may result from up to 
 72.20  three separate improvements to the homestead.  The application 
 72.21  shall state, in clear language, that if more than three 
 72.22  improvements are made to the qualifying property, a taxpayer may 
 72.23  choose which three improvements are eligible, provided that 
 72.24  after the taxpayer has made the choice and any valuation 
 72.25  attributable to those improvements has been excluded from 
 72.26  taxation, no further changes can be made by the taxpayer. 
 72.27     If 50 percent or more of the square footage of a structure 
 72.28  is voluntarily razed or removed, the valuation increase 
 72.29  attributable to any subsequent improvements to the remaining 
 72.30  structure does not qualify for the exclusion under this 
 72.31  subdivision.  If a structure is unintentionally or accidentally 
 72.32  destroyed by a natural disaster, the property is eligible for an 
 72.33  exclusion under this subdivision provided that the structure was 
 72.34  not completely destroyed.  The qualifying value on property 
 72.35  destroyed by a natural disaster shall be computed based upon the 
 72.36  increase from that structure's market value as determined on 
 73.1   January 2 of the year in which the disaster occurred.  A 
 73.2   property receiving benefits under the homestead disaster 
 73.3   provisions under section 273.123 is not disqualified from 
 73.4   receiving an exclusion under this subdivision.  If any 
 73.5   combination of improvements made to a structure after January 1, 
 73.6   1993, increases the size of the structure by 100 percent or 
 73.7   more, the valuation increase attributable to the portion of the 
 73.8   improvement that causes the structure's size to exceed 100 
 73.9   percent does not qualify for exclusion under this subdivision. 
 73.10     Sec. 4.  Minnesota Statutes 1994, section 273.124, 
 73.11  subdivision 1, is amended to read: 
 73.12     Subdivision 1.  [GENERAL RULE.] (a) Residential real estate 
 73.13  that is occupied and used for the purposes of a homestead by its 
 73.14  owner, who must be a Minnesota resident, is a residential 
 73.15  homestead.  
 73.16     Agricultural land, as defined in section 273.13, 
 73.17  subdivision 23, that is occupied and used as a homestead by its 
 73.18  owner, who must be a Minnesota resident, is an agricultural 
 73.19  homestead. 
 73.20     Dates for establishment of a homestead and homestead 
 73.21  treatment provided to particular types of property are as 
 73.22  provided in this section.  
 73.23     Property of a trustee, beneficiary, or grantor of a trust 
 73.24  is not disqualified from receiving homestead benefits if the 
 73.25  homestead requirements under this chapter are satisfied. 
 73.26     The assessor shall require proof, as provided in 
 73.27  subdivision 13, of the facts upon which classification as a 
 73.28  homestead may be determined.  Notwithstanding any other law, the 
 73.29  assessor may at any time require a homestead application to be 
 73.30  filed in order to verify that any property classified as a 
 73.31  homestead continues to be eligible for homestead status. 
 73.32     When there is a name change or a transfer of homestead 
 73.33  property, the assessor may reclassify the property in the next 
 73.34  assessment unless a homestead application is filed to verify 
 73.35  that the property continues to qualify for homestead 
 73.36  classification. 
 74.1      (b) For purposes of this section, homestead property shall 
 74.2   include property which is used for purposes of the homestead but 
 74.3   is separated from the homestead by a road, street, lot, 
 74.4   waterway, or other similar intervening property.  The term "used 
 74.5   for purposes of the homestead" shall include but not be limited 
 74.6   to uses for gardens, garages, or other outbuildings commonly 
 74.7   associated with a homestead, but shall not include vacant land 
 74.8   held primarily for future development.  In order to receive 
 74.9   homestead treatment for the noncontiguous property, the owner 
 74.10  shall apply for it to the assessor by July 1 of the year when 
 74.11  the treatment is initially sought.  After initial qualification 
 74.12  for the homestead treatment, additional applications for 
 74.13  subsequent years are not required. 
 74.14     (c) Residential real estate that is occupied and used for 
 74.15  purposes of a homestead by a relative of the owner is a 
 74.16  homestead but only to the extent of the homestead treatment that 
 74.17  would be provided if the related owner occupied the property.  
 74.18  For purposes of this paragraph and paragraph (f), "relative" 
 74.19  means a parent, stepparent, child, stepchild, grandparent, 
 74.20  grandchild, brother, sister, uncle, or aunt.  This relationship 
 74.21  may be by blood or marriage.  Property that was classified as 
 74.22  seasonal recreational residential property at the time when 
 74.23  treatment under this paragraph would first apply shall continue 
 74.24  to be classified as seasonal recreational residential property 
 74.25  for the first four assessment years beginning after the date 
 74.26  when the relative of the owner occupies the property as a 
 74.27  homestead will not be reclassified as a homestead unless it is 
 74.28  occupied as a homestead by the owner; this delay prohibition 
 74.29  also applies to property that, in the absence of this paragraph, 
 74.30  would have been classified as seasonal recreational residential 
 74.31  property at the time when the residence was constructed.  
 74.32  Neither the related occupant nor the owner of the property may 
 74.33  claim a property tax refund under chapter 290A for a homestead 
 74.34  occupied by a relative.  In the case of a residence located on 
 74.35  agricultural land, only the house, garage, and immediately 
 74.36  surrounding one acre of land shall be classified as a homestead 
 75.1   under this paragraph, except as provided in paragraph (d). 
 75.2      (d) Agricultural property that is occupied and used for 
 75.3   purposes of a homestead by a relative of the owner, is a 
 75.4   homestead, only to the extent of the homestead treatment that 
 75.5   would be provided if the related owner occupied the property, 
 75.6   and only if all of the following criteria are met: 
 75.7      (1) the relative who is occupying the agricultural property 
 75.8   is a son, daughter, father, or mother of the owner of the 
 75.9   agricultural property or a son or daughter of the spouse of the 
 75.10  owner of the agricultural property, 
 75.11     (2) the owner of the agricultural property must be a 
 75.12  Minnesota resident, 
 75.13     (3) the owner of the agricultural property must not receive 
 75.14  homestead treatment on any other agricultural property in 
 75.15  Minnesota, and 
 75.16     (4) the owner of the agricultural property is limited to 
 75.17  only one agricultural homestead per family under this paragraph. 
 75.18     Neither the related occupant nor the owner of the property 
 75.19  may claim a property tax refund under chapter 290A for a 
 75.20  homestead occupied by a relative qualifying under this 
 75.21  paragraph.  For purposes of this paragraph, "agricultural 
 75.22  property" means the house, garage, other farm buildings and 
 75.23  structures, and agricultural land. 
 75.24     Application must be made to the assessor by the owner of 
 75.25  the agricultural property to receive homestead benefits under 
 75.26  this paragraph.  The assessor may require the necessary proof 
 75.27  that the requirements under this paragraph have been met. 
 75.28     (e) In the case of property owned by a property owner who 
 75.29  is married, the assessor must not deny homestead treatment in 
 75.30  whole or in part if only one of the spouses occupies the 
 75.31  property and the other spouse is absent due to:  (1) marriage 
 75.32  dissolution proceedings, (2) legal separation, (3) employment or 
 75.33  self-employment in another location as provided under 
 75.34  subdivision 13, or (4) residence in a nursing home or boarding 
 75.35  care facility.  Homestead treatment, in whole or in part, shall 
 75.36  not be denied to the spouse of an owner if he or she previously 
 76.1   occupied the residence with the owner and the absence of the 
 76.2   owner is due to one of the prior four exceptions. 
 76.3      (f) If an individual is purchasing property with the intent 
 76.4   of claiming it as a homestead and is required by the terms of 
 76.5   the financing agreement to have a relative shown on the deed as 
 76.6   a coowner, the assessor shall allow a full homestead 
 76.7   classification and extend full homestead credit.  This provision 
 76.8   only applies to first-time purchasers, whether married or 
 76.9   single, or to a person who had previously been married and is 
 76.10  purchasing as a single individual for the first time.  The 
 76.11  application for homestead benefits must be on a form prescribed 
 76.12  by the commissioner and must contain the data necessary for the 
 76.13  assessor to determine if full homestead benefits are warranted. 
 76.14     Sec. 5.  Minnesota Statutes 1994, section 273.124, 
 76.15  subdivision 13, is amended to read: 
 76.16     Subd. 13.  [HOMESTEAD APPLICATION.] (a) A person who meets 
 76.17  the homestead requirements under subdivision 1 must file a 
 76.18  homestead application with the county assessor to initially 
 76.19  obtain homestead classification. 
 76.20     (b) On or before January 2, 1993, each county assessor 
 76.21  shall mail a homestead application to the owner of each parcel 
 76.22  of property within the county which was classified as homestead 
 76.23  for the 1992 assessment year.  The format and contents of a 
 76.24  uniform homestead application shall be prescribed by the 
 76.25  commissioner of revenue.  The commissioner shall consult with 
 76.26  the chairs of the house and senate tax committees on the 
 76.27  contents of the homestead application form.  The application 
 76.28  must clearly inform the taxpayer that this application must be 
 76.29  signed by all owners who occupy the property or by the 
 76.30  qualifying relative and returned to the county assessor in order 
 76.31  for the property to continue receiving homestead treatment.  The 
 76.32  envelope containing the homestead application shall clearly 
 76.33  identify its contents and alert the taxpayer of its necessary 
 76.34  immediate response. 
 76.35     (c) Every property owner applying for homestead 
 76.36  classification must furnish to the county assessor the social 
 77.1   security number of each occupant who is listed as an owner of 
 77.2   the property on the deed of record, the name and address of each 
 77.3   owner who does not occupy the property, and the name and social 
 77.4   security number of each owner's spouse who occupies the 
 77.5   property.  The application must be signed by each owner who 
 77.6   occupies the property and by each owner's spouse who occupies 
 77.7   the property, or, in the case of property that qualifies as a 
 77.8   homestead under subdivision 1, paragraph (c), by the qualifying 
 77.9   relative. 
 77.10     If a property owner occupies a homestead, the property 
 77.11  owner's spouse may not claim another property as a homestead 
 77.12  unless the property owner and the property owner's spouse file 
 77.13  with the assessor an affidavit or other proof required by the 
 77.14  assessor stating that the property owner's spouse does not 
 77.15  occupy the homestead because marriage dissolution proceedings 
 77.16  are pending, the spouses are legally separated, or the spouse's 
 77.17  employment or self-employment at a location distant from the 
 77.18  other spouse's place of employment requires the spouse to have a 
 77.19  separate homestead.  The assessor may require proof of 
 77.20  employment or self-employment and employment or self-employment 
 77.21  location, or proof of dissolution proceedings or legal 
 77.22  separation. 
 77.23     If the social security number or affidavit or other proof 
 77.24  is not provided, the county assessor shall classify the property 
 77.25  as nonhomestead.  Owners or spouses occupying residences owned 
 77.26  by their spouses and previously occupied with the other spouse, 
 77.27  either of whom fail to include the other spouse's name and 
 77.28  social security number of the homestead application or provide 
 77.29  the affidavits or other proof requested, will be deemed to have 
 77.30  elected to receive only partial homestead treatment of their 
 77.31  residence.  The remainder of the residence will be classified as 
 77.32  nonhomestead residential.  When an owner or spouse's name and 
 77.33  social security number appear on homestead applications for two 
 77.34  separate residences and only one application is signed, the 
 77.35  owner or spouse will be deemed to have elected to homestead the 
 77.36  residence for which the application was signed. 
 78.1      The social security numbers or affidavits or other proofs 
 78.2   of the property owners and spouses are private data on 
 78.3   individuals as defined by section 13.02, subdivision 12, but, 
 78.4   notwithstanding that section, the private data may be disclosed 
 78.5   to the commissioner of revenue, or, for purposes of proceeding 
 78.6   under the revenue recapture act to recover personal property 
 78.7   taxes owing, to the county treasurer. 
 78.8      (d) If residential real estate is occupied and used for 
 78.9   purposes of a homestead by a relative of the owner and qualifies 
 78.10  for a homestead under subdivision 1, paragraph (c), in order for 
 78.11  the property to receive homestead status, a homestead 
 78.12  application must be filed with the assessor.  The social 
 78.13  security number of each relative occupying the property and the 
 78.14  social security number of each owner who is related to an 
 78.15  occupant of the property shall be required on the homestead 
 78.16  application filed under this subdivision.  If a different 
 78.17  relative of the owner subsequently occupies the property, the 
 78.18  owner of the property must notify the assessor within 30 days of 
 78.19  the change in occupancy.  The social security number of a 
 78.20  relative occupying the property is private data on individuals 
 78.21  as defined by section 13.02, subdivision 12, but may be 
 78.22  disclosed to the commissioner of revenue.  
 78.23     (e) The homestead application shall also notify the 
 78.24  property owners that the application filed under this section 
 78.25  will not be mailed annually and that if the property is granted 
 78.26  homestead status for the 1993 assessment, or any assessment year 
 78.27  thereafter, that same property shall remain classified as 
 78.28  homestead until the property is sold or transferred to another 
 78.29  person, or the owners, the spouse of the owner, or the relatives 
 78.30  no longer use the property as their homestead.  Upon the sale or 
 78.31  transfer of the homestead property, a certificate of value must 
 78.32  be timely filed with the county auditor as provided under 
 78.33  section 272.115.  Failure to notify the assessor within 30 days 
 78.34  that the property has been sold, transferred, or that the owner, 
 78.35  the spouse of the owner, or the relative is no longer occupying 
 78.36  the property as a homestead, shall result in the penalty 
 79.1   provided under this subdivision and the property will lose its 
 79.2   current homestead status. 
 79.3      (f) If the homestead application is not returned within 30 
 79.4   days, the county will send a second application to the present 
 79.5   owners of record.  The notice of proposed property taxes 
 79.6   prepared under section 275.065, subdivision 3, shall reflect the 
 79.7   property's classification.  Beginning with assessment year 1993 
 79.8   for all properties, If a homestead application has not been 
 79.9   filed with the county by December 15, the assessor shall 
 79.10  classify the property as nonhomestead for the current assessment 
 79.11  year for taxes payable in the following year, provided that the 
 79.12  owner may be entitled to receive the homestead classification by 
 79.13  proper application under section 375.192. 
 79.14     (g) At the request of the commissioner, each county must 
 79.15  give the commissioner a list that includes the name and social 
 79.16  security number of each property owner and the property owner's 
 79.17  spouse occupying the property, or relative of a property owner, 
 79.18  applying for homestead classification under this subdivision.  
 79.19  The commissioner shall use the information provided on the lists 
 79.20  as appropriate under the law, including for the detection of 
 79.21  improper claims by owners, or relatives of owners, under chapter 
 79.22  290A.  
 79.23     (h) If, in comparing the lists supplied by the counties, 
 79.24  the commissioner finds that a property owner is claiming more 
 79.25  than one homestead, the commissioner shall notify the 
 79.26  appropriate counties.  Within 90 days of the notification, the 
 79.27  county assessor shall investigate to determine if the homestead 
 79.28  classification was properly claimed.  If the property owner does 
 79.29  not qualify, the county assessor shall notify the county auditor 
 79.30  who will determine the amount of homestead benefits that had 
 79.31  been improperly allowed.  For the purpose of this section, 
 79.32  "homestead benefits" means the tax reduction resulting from the 
 79.33  classification as a homestead under section 273.13, the taconite 
 79.34  homestead credit under section 273.135, and the supplemental 
 79.35  homestead credit under section 273.1391. 
 79.36     The county auditor shall send a notice to the owners of the 
 80.1   affected property, demanding reimbursement of the homestead 
 80.2   benefits plus a penalty equal to 100 percent of the homestead 
 80.3   benefits.  The property owners may appeal the county's 
 80.4   determination by filing a notice of appeal with the Minnesota 
 80.5   tax court within 60 days of the date of the notice from the 
 80.6   county.  If the amount of homestead benefits and penalty is not 
 80.7   paid within 60 days, and if no appeal has been filed, the county 
 80.8   auditor shall certify the amount of taxes and penalty to the 
 80.9   succeeding year's tax list to be collected as part of the 
 80.10  property taxes.  In the case of a manufactured home, the amount 
 80.11  shall be certified to the current year's tax list for collection.
 80.12     (i) Any amount of homestead benefits recovered by the 
 80.13  county from the property owner shall be distributed to the 
 80.14  county, city or town, and school district where the property is 
 80.15  located in the same proportion that each taxing district's levy 
 80.16  was to the total of the three taxing districts' levy for the 
 80.17  current year.  Any amount recovered attributable to taconite 
 80.18  homestead credit shall be transmitted to the St. Louis county 
 80.19  auditor to be deposited in the taconite property tax relief 
 80.20  account.  The total amount of penalty collected must be 
 80.21  deposited in the county general fund. 
 80.22     (j) If a property owner has applied for more than one 
 80.23  homestead and the county assessors cannot determine which 
 80.24  property should be classified as homestead, the county assessors 
 80.25  will refer the information to the commissioner.  The 
 80.26  commissioner shall make the determination and notify the 
 80.27  counties within 60 days. 
 80.28     (k) In addition to lists of homestead properties, the 
 80.29  commissioner may ask the counties to furnish lists of all 
 80.30  properties and the record owners. 
 80.31     Sec. 6.  Minnesota Statutes 1994, section 273.13, 
 80.32  subdivision 24, is amended to read: 
 80.33     Subd. 24.  [CLASS 3.] (a) Commercial and industrial 
 80.34  property and utility real and personal property, except class 5 
 80.35  property as identified in subdivision 31, clause (1), is class 
 80.36  3a.  It has a class rate of three percent of the first $100,000 
 81.1   of market value for taxes payable in 1993 and thereafter, and 
 81.2   5.06 percent of the market value over $100,000.  In the case of 
 81.3   state-assessed commercial, industrial, and utility property 
 81.4   owned by one person or entity, only one parcel has a reduced 
 81.5   class rate on the first $100,000 of market value.  In the case 
 81.6   of other commercial, industrial, and utility property owned by 
 81.7   one person or entity, only one parcel in each county has a 
 81.8   reduced class rate on the first $100,000 of market value, except 
 81.9   that: 
 81.10     (1) if the market value of the parcel is less than 
 81.11  $100,000, and additional parcels are owned by the same person or 
 81.12  entity in the same city or town within that county, the reduced 
 81.13  class rate shall be applied up to a combined total market value 
 81.14  of $100,000 for all parcels owned by the same person or entity 
 81.15  in the same city or town within the county; 
 81.16     (2) in the case of grain, fertilizer, and feed elevator 
 81.17  facilities, as defined in section 18C.305, subdivision 1, or 
 81.18  232.21, subdivision 8, the limitation to one parcel per owner 
 81.19  per county for the reduced class rate shall not apply, but there 
 81.20  shall be a limit of $100,000 of preferential value per site of 
 81.21  contiguous parcels owned by the same person or entity.  Only the 
 81.22  value of the elevator portion of each parcel shall qualify for 
 81.23  treatment under this clause.  For purposes of this subdivision, 
 81.24  contiguous parcels include parcels separated only by a railroad 
 81.25  or public road right-of-way; and 
 81.26     (3) in the case of property owned by a nonprofit charitable 
 81.27  organization that qualifies for tax exemption under section 
 81.28  501(c)(3) of the Internal Revenue Code of 1986, as amended 
 81.29  through December 31, 1993, if the property is used as a business 
 81.30  incubator, the limitation to one parcel per owner per county for 
 81.31  the reduced class rate shall not apply, provided that the 
 81.32  reduced rate applies only to the first $100,000 of value per 
 81.33  parcel owned by the organization.  As used in this clause, a 
 81.34  "business incubator" is a facility used for the development of 
 81.35  nonretail businesses, offering access to equipment, space, 
 81.36  services, and advice to the tenant businesses, for the purpose 
 82.1   of encouraging economic development, diversification, and job 
 82.2   creation in the area served by the organization. 
 82.3      To receive the reduced class rate on additional parcels 
 82.4   under clause (1), (2), or (3), the taxpayer must notify the 
 82.5   county assessor that the taxpayer owns more than one parcel that 
 82.6   qualifies under clause (1), (2), or (3). 
 82.7      (b) Employment property defined in section 469.166, during 
 82.8   the period provided in section 469.170, shall constitute class 
 82.9   3b and has a class rate of 2.3 percent of the first $50,000 of 
 82.10  market value and 3.6 percent of the remainder, except that for 
 82.11  employment property located in a border city enterprise zone 
 82.12  designated pursuant to section 469.168, subdivision 4, paragraph 
 82.13  (c), the class rate of the first $100,000 of market value and 
 82.14  the class rate of the remainder is determined under paragraph 
 82.15  (a), unless the governing body of the city designated as an 
 82.16  enterprise zone determines that a specific parcel shall be 
 82.17  assessed pursuant to the first clause of this sentence.  The 
 82.18  governing body may provide for assessment under the first clause 
 82.19  of the preceding sentence only for property which is located in 
 82.20  an area which has been designated by the governing body for the 
 82.21  receipt of tax reductions authorized by section 469.171, 
 82.22  subdivision 1. 
 82.23     (c) Structures which are (i) located on property classified 
 82.24  as class 3a, (ii) constructed after January 2, 1995, and (iii) 
 82.25  located in a transit zone as defined under section 473.3915, 
 82.26  shall have a class rate of four percent on that portion of the 
 82.27  market value in excess of $100,000.  The four percent rate shall 
 82.28  also apply to that portion of any class 3a structure located in 
 82.29  a transit zone constructed after January 2, 1995, even if the 
 82.30  remainder of the structure was constructed prior to January 2, 
 82.31  1995.  For the purposes of this paragraph, a structure shall be 
 82.32  considered to be located in a transit zone if any portion of the 
 82.33  structure lies within the zone. 
 82.34     Sec. 7.  Minnesota Statutes 1994, section 273.13, 
 82.35  subdivision 25, is amended to read: 
 82.36     Subd. 25.  [CLASS 4.] (a) Class 4a is residential real 
 83.1   estate containing four or more units and used or held for use by 
 83.2   the owner or by the tenants or lessees of the owner as a 
 83.3   residence for rental periods of 30 days or more.  Class 4a also 
 83.4   includes hospitals licensed under sections 144.50 to 144.56, 
 83.5   other than hospitals exempt under section 272.02, and contiguous 
 83.6   property used for hospital purposes, without regard to whether 
 83.7   the property has been platted or subdivided.  Class 4a property 
 83.8   has a class rate of 3.5 percent of market value for taxes 
 83.9   payable in 1992, and 3.4 percent of market value for taxes 
 83.10  payable in 1993 and thereafter. 
 83.11     (b) Class 4b includes: 
 83.12     (1) residential real estate containing less than four 
 83.13  units, other than seasonal residential, and recreational; 
 83.14     (2) manufactured homes not classified under any other 
 83.15  provision; 
 83.16     (3) a dwelling, garage, and surrounding one acre of 
 83.17  property on a nonhomestead farm classified under subdivision 23, 
 83.18  paragraph (b).  
 83.19     Class 4b property has a class rate of 2.8 percent of market 
 83.20  value for taxes payable in 1992, 2.5 percent of market value for 
 83.21  taxes payable in 1993, and 2.3 percent of market value for taxes 
 83.22  payable in 1994 and thereafter. 
 83.23     (c) Class 4c property includes: 
 83.24     (1) a structure that is:  
 83.25     (i) situated on real property that is used for housing for 
 83.26  the elderly or for low- and moderate-income families as defined 
 83.27  in Title II, as amended through December 31, 1990, of the 
 83.28  National Housing Act or the Minnesota housing finance agency law 
 83.29  of 1971, as amended, or rules promulgated by the agency and 
 83.30  financed by a direct federal loan or federally insured loan made 
 83.31  pursuant to Title II of the Act; or 
 83.32     (ii) situated on real property that is used for housing the 
 83.33  elderly or for low- and moderate-income families as defined by 
 83.34  the Minnesota housing finance agency law of 1971, as amended, or 
 83.35  rules adopted by the agency pursuant thereto and financed by a 
 83.36  loan made by the Minnesota housing finance agency pursuant to 
 84.1   the provisions of the act.  
 84.2      This clause applies only to property of a nonprofit or 
 84.3   limited dividend entity.  Property is classified as class 4c 
 84.4   under this clause for 15 years from the date of the completion 
 84.5   of the original construction or substantial rehabilitation, or 
 84.6   for the original term of the loan.  
 84.7      (2) a structure that is: 
 84.8      (i) situated upon real property that is used for housing 
 84.9   lower income families or elderly or handicapped persons, as 
 84.10  defined in section 8 of the United States Housing Act of 1937, 
 84.11  as amended; and 
 84.12     (ii) owned by an entity which has entered into a housing 
 84.13  assistance payments contract under section 8 which provides 
 84.14  assistance for 100 percent of the dwelling units in the 
 84.15  structure, other than dwelling units intended for management or 
 84.16  maintenance personnel.  Property is classified as class 4c under 
 84.17  this clause for the term of the housing assistance payments 
 84.18  contract, including all renewals, or for the term of its 
 84.19  permanent financing, whichever is shorter; and 
 84.20     (3) a qualified low-income building as defined in section 
 84.21  42(c)(2) of the Internal Revenue Code of 1986, as amended 
 84.22  through December 31, 1990, that (i) receives a low-income 
 84.23  housing credit under section 42 of the Internal Revenue Code of 
 84.24  1986, as amended through December 31, 1990; or (ii) meets the 
 84.25  requirements of that section and receives public financing, 
 84.26  except financing provided under sections 469.174 to 469.179, 
 84.27  which contains terms restricting the rents; or (iii) meets the 
 84.28  requirements of section 273.1317.  Classification pursuant to 
 84.29  this clause is limited to a term of 15 years.  The public 
 84.30  financing received must be from at least one of the following 
 84.31  sources:  government issued bonds exempt from taxes under 
 84.32  section 103 of the Internal Revenue Code of 1986, as amended 
 84.33  through December 31, 1993, the proceeds of which are used for 
 84.34  the acquisition or rehabilitation of the building; programs 
 84.35  under section 221(d)(3), 202, or 236, of Title II of the 
 84.36  National Housing Act; rental housing program funds under Section 
 85.1   8 of the United States Housing Act of 1937 or the market rate 
 85.2   family graduated payment mortgage program funds administered by 
 85.3   the Minnesota housing finance agency that are used for the 
 85.4   acquisition or rehabilitation of the building; public financing 
 85.5   provided by a local government used for the acquisition or 
 85.6   rehabilitation of the building, including grants or loans from 
 85.7   federal community development block grants, HOME block grants, 
 85.8   or residential rental bonds issued under chapter 474A; or other 
 85.9   rental housing program funds provided by the Minnesota housing 
 85.10  finance agency for the acquisition or rehabilitation of the 
 85.11  building. 
 85.12     For all properties described in clauses (1), (2), and (3) 
 85.13  and in paragraph (d), the market value determined by the 
 85.14  assessor must be based on the normal approach to value using 
 85.15  normal unrestricted rents unless the owner of the property 
 85.16  elects to have the property assessed under Laws 1991, chapter 
 85.17  291, article 1, section 55.  If the owner of the property elects 
 85.18  to have the market value determined on the basis of the actual 
 85.19  restricted rents, as provided in Laws 1991, chapter 291, article 
 85.20  1, section 55, the property will be assessed at the rate 
 85.21  provided for class 4a or class 4b property, as appropriate.  
 85.22  Properties described in clauses (1)(ii), (3), and (4) may apply 
 85.23  to the assessor for valuation under Laws 1991, chapter 291, 
 85.24  article 1, section 55.  The land on which these structures are 
 85.25  situated has the class rate given in paragraph (b) if the 
 85.26  structure contains fewer than four units, and the class rate 
 85.27  given in paragraph (a) if the structure contains four or more 
 85.28  units.  This clause applies only to the property of a nonprofit 
 85.29  or limited dividend entity.  
 85.30     (4) a parcel of land, not to exceed one acre, and its 
 85.31  improvements or a parcel of unimproved land, not to exceed one 
 85.32  acre, if it is owned by a neighborhood real estate trust and at 
 85.33  least 60 percent of the dwelling units, if any, on all land 
 85.34  owned by the trust are leased to or occupied by lower income 
 85.35  families or individuals.  This clause does not apply to any 
 85.36  portion of the land or improvements used for nonresidential 
 86.1   purposes.  For purposes of this clause, a lower income family is 
 86.2   a family with an income that does not exceed 65 percent of the 
 86.3   median family income for the area, and a lower income individual 
 86.4   is an individual whose income does not exceed 65 percent of the 
 86.5   median individual income for the area, as determined by the 
 86.6   United States Secretary of Housing and Urban Development.  For 
 86.7   purposes of this clause, "neighborhood real estate trust" means 
 86.8   an entity which is certified by the governing body of the 
 86.9   municipality in which it is located to have the following 
 86.10  characteristics: 
 86.11     (a) it is a nonprofit corporation organized under chapter 
 86.12  317A; 
 86.13     (b) it has as its principal purpose providing housing for 
 86.14  lower income families in a specific geographic community 
 86.15  designated in its articles or bylaws; 
 86.16     (c) it limits membership with voting rights to residents of 
 86.17  the designated community; and 
 86.18     (d) it has a board of directors consisting of at least 
 86.19  seven directors, 60 percent of whom are members with voting 
 86.20  rights and, to the extent feasible, 25 percent of whom are 
 86.21  elected by resident members of buildings owned by the trust; and 
 86.22     (5) except as provided in subdivision 22, paragraph (c), 
 86.23  real property devoted to temporary and seasonal residential 
 86.24  occupancy for recreation purposes, including real property 
 86.25  devoted to temporary and seasonal residential occupancy for 
 86.26  recreation purposes and not devoted to commercial purposes for 
 86.27  more than 250 days in the year preceding the year of 
 86.28  assessment.  For purposes of this clause, property is devoted to 
 86.29  a commercial purpose on a specific day if any portion of the 
 86.30  property is used for residential occupancy, and a fee is charged 
 86.31  for residential occupancy.  Class 4c also includes commercial 
 86.32  use real property used exclusively for recreational purposes in 
 86.33  conjunction with class 4c property devoted to temporary and 
 86.34  seasonal residential occupancy for recreational purposes, up to 
 86.35  a total of two acres, provided the property is not devoted to 
 86.36  commercial recreational use for more than 250 days in the year 
 87.1   preceding the year of assessment and is located within two miles 
 87.2   of the class 4c property with which it is used.  Class 4c 
 87.3   property classified in this clause also includes the remainder 
 87.4   of class 1c resorts.  Owners of real property devoted to 
 87.5   temporary and seasonal residential occupancy for recreation 
 87.6   purposes and all or a portion of which was devoted to commercial 
 87.7   purposes for not more than 250 days in the year preceding the 
 87.8   year of assessment desiring classification as class 1c or 4c, 
 87.9   must submit a declaration to the assessor designating the cabins 
 87.10  or units occupied for 250 days or less in the year preceding the 
 87.11  year of assessment by January 15 of the assessment year.  Those 
 87.12  cabins or units and a proportionate share of the land on which 
 87.13  they are located will be designated class 1c or 4c as otherwise 
 87.14  provided.  The remainder of the cabins or units and a 
 87.15  proportionate share of the land on which they are located will 
 87.16  be designated as class 3a.  The first $100,000 of the market 
 87.17  value of the remainder of the cabins or units and a 
 87.18  proportionate share of the land on which they are located shall 
 87.19  have a class rate of three percent.  The owner of property 
 87.20  desiring designation as class 1c or 4c property must provide 
 87.21  guest registers or other records demonstrating that the units 
 87.22  for which class 1c or 4c designation is sought were not occupied 
 87.23  for more than 250 days in the year preceding the assessment if 
 87.24  so requested.  The portion of a property operated as a (1) 
 87.25  restaurant, (2) bar, (3) gift shop, and (4) other nonresidential 
 87.26  facility operated on a commercial basis not directly related to 
 87.27  temporary and seasonal residential occupancy for recreation 
 87.28  purposes shall not qualify for class 1c or 4c; 
 87.29     (6) real property up to a maximum of one acre of land owned 
 87.30  by a nonprofit community service oriented organization; provided 
 87.31  that the property is not used for a revenue-producing activity 
 87.32  for more than six days in the calendar year preceding the year 
 87.33  of assessment and the property is not used for residential 
 87.34  purposes on either a temporary or permanent basis.  For purposes 
 87.35  of this clause, a "nonprofit community service oriented 
 87.36  organization" means any corporation, society, association, 
 88.1   foundation, or institution organized and operated exclusively 
 88.2   for charitable, religious, fraternal, civic, or educational 
 88.3   purposes, and which is exempt from federal income taxation 
 88.4   pursuant to section 501(c)(3), (10), or (19) of the Internal 
 88.5   Revenue Code of 1986, as amended through December 31, 1990.  For 
 88.6   purposes of this clause, "revenue-producing activities" shall 
 88.7   include but not be limited to property or that portion of the 
 88.8   property that is used as an on-sale intoxicating liquor or 3.2 
 88.9   percent malt liquor establishment licensed under chapter 340A, a 
 88.10  restaurant open to the public, bowling alley, a retail store, 
 88.11  gambling conducted by organizations licensed under chapter 349, 
 88.12  an insurance business, or office or other space leased or rented 
 88.13  to a lessee who conducts a for-profit enterprise on the 
 88.14  premises.  Any portion of the property which is used for 
 88.15  revenue-producing activities for more than six days in the 
 88.16  calendar year preceding the year of assessment shall be assessed 
 88.17  as class 3a.  The use of the property for social events open 
 88.18  exclusively to members and their guests for periods of less than 
 88.19  24 hours, when an admission is not charged nor any revenues are 
 88.20  received by the organization shall not be considered a 
 88.21  revenue-producing activity; 
 88.22     (7) post-secondary student housing of not more than one 
 88.23  acre of land that is owned by a nonprofit corporation organized 
 88.24  under chapter 317A and is used exclusively by a student 
 88.25  cooperative, sorority, or fraternity for on-campus housing or 
 88.26  housing located within two miles of the border of a college 
 88.27  campus; and 
 88.28     (8) manufactured home parks as defined in section 327.14, 
 88.29  subdivision 3. 
 88.30     Class 4c property has a class rate of 2.3 percent of market 
 88.31  value, except that (i) for each parcel of seasonal residential 
 88.32  recreational property not used for commercial purposes under 
 88.33  clause (5) has a class rate of 2.2 percent of market value for 
 88.34  taxes payable in 1992, and for taxes payable in 1993 and 
 88.35  thereafter, the first $72,000 of market value on each parcel has 
 88.36  a class rate of two percent and the market value of each parcel 
 89.1   that exceeds $72,000 has a class rate of 2.5 percent, and (ii) 
 89.2   manufactured home parks assessed under clause (8) have a class 
 89.3   rate of two percent for taxes payable in 1993, 1994, and 1995 
 89.4   only.  
 89.5      (d) Class 4d property includes: 
 89.6      (1) a structure that is: 
 89.7      (i) situated on real property that is used for housing for 
 89.8   the elderly or for low and moderate income families as defined 
 89.9   by the Farmers Home Administration; 
 89.10     (ii) located in a municipality of less than 10,000 
 89.11  population; and 
 89.12     (iii) financed by a direct loan or insured loan from the 
 89.13  Farmers Home Administration.  Property is classified under this 
 89.14  clause for 15 years from the date of the completion of the 
 89.15  original construction or for the original term of the loan.  
 89.16     The class rates in paragraph (c), clauses (1), (2), and (3) 
 89.17  and this clause apply to the properties described in them, only 
 89.18  in proportion to occupancy of the structure by elderly or 
 89.19  handicapped persons or low and moderate income families as 
 89.20  defined in the applicable laws unless construction of the 
 89.21  structure had been commenced prior to January 1, 1984; or the 
 89.22  project had been approved by the governing body of the 
 89.23  municipality in which it is located prior to June 30, 1983; or 
 89.24  financing of the project had been approved by a federal or state 
 89.25  agency prior to June 30, 1983.  For those properties, 4c or 4d 
 89.26  classification is available only for those units meeting the 
 89.27  requirements of section 273.1318. 
 89.28     Classification under this clause is only available to 
 89.29  property of a nonprofit or limited dividend entity. 
 89.30     In the case of a structure financed or refinanced under any 
 89.31  federal or state mortgage insurance or direct loan program 
 89.32  exclusively for housing for the elderly or for housing for the 
 89.33  handicapped, a unit shall be considered occupied so long as it 
 89.34  is actually occupied by an elderly or handicapped person or, if 
 89.35  vacant, is held for rental to an elderly or handicapped person. 
 89.36     (2) For taxes payable in 1992, 1993, and 1994, only, 
 90.1   buildings and appurtenances, together with the land upon which 
 90.2   they are located, leased by the occupant under the community 
 90.3   lending model lease-purchase mortgage loan program administered 
 90.4   by the Federal National Mortgage Association, provided the 
 90.5   occupant's income is no greater than 60 percent of the county or 
 90.6   area median income, adjusted for family size and the building 
 90.7   consists of existing single family or duplex housing.  The lease 
 90.8   agreement must provide for a portion of the lease payment to be 
 90.9   escrowed as a nonrefundable down payment on the housing.  To 
 90.10  qualify under this clause, the taxpayer must apply to the county 
 90.11  assessor by May 30 of each year.  The application must be 
 90.12  accompanied by an affidavit or other proof required by the 
 90.13  assessor to determine qualification under this clause. 
 90.14     (3) Qualifying buildings and appurtenances, together with 
 90.15  the land upon which they are located, leased for a period of up 
 90.16  to five years by the occupant under a lease-purchase program 
 90.17  administered by the Minnesota housing finance agency or a 
 90.18  housing and redevelopment authority authorized under sections 
 90.19  469.001 to 469.047, provided the occupant's income is no greater 
 90.20  than 80 percent of the county or area median income, adjusted 
 90.21  for family size, and the building consists of two or less 
 90.22  dwelling units.  The lease agreement must provide for a portion 
 90.23  of the lease payment to be escrowed as a nonrefundable down 
 90.24  payment on the housing.  The administering agency shall verify 
 90.25  the occupants income eligibility and certify to the county 
 90.26  assessor that the occupant meets the income criteria under this 
 90.27  paragraph.  To qualify under this clause, the taxpayer must 
 90.28  apply to the county assessor by May 30 of each year.  For 
 90.29  purposes of this section, "qualifying buildings and 
 90.30  appurtenances" shall be defined as one or two unit residential 
 90.31  buildings which are unoccupied and have been abandoned and 
 90.32  boarded for at least six months. 
 90.33     Class 4d property has a class rate of two percent of market 
 90.34  value except that property classified under clause (3), shall 
 90.35  have the same class rate as class 1a property. 
 90.36     (e) Residential rental property that would otherwise be 
 91.1   assessed as class 4 property under paragraph (a); paragraph (b), 
 91.2   clauses (1) and (3); paragraph (c), clause (1), (2), (3), or 
 91.3   (4), is assessed at the class rate applicable to it under 
 91.4   Minnesota Statutes 1988, section 273.13, if it is found to be a 
 91.5   substandard building under section 273.1316.  Residential rental 
 91.6   property that would otherwise be assessed as class 4 property 
 91.7   under paragraph (d) is assessed at 2.3 percent of market value 
 91.8   if it is found to be a substandard building under section 
 91.9   273.1316. 
 91.10     Sec. 8.  Minnesota Statutes 1994, section 273.37, is 
 91.11  amended by adding a subdivision to read: 
 91.12     Subd. 3.  [WIND ENERGY CONVERSION SYSTEMS.] Taxable wind 
 91.13  energy conversion systems, situated upon land owned by another 
 91.14  person, which are not in good faith owned, operated, and 
 91.15  exclusively controlled by such other person, shall be listed and 
 91.16  assessed as personal property in the town or district where 
 91.17  situated, in the name of the owner. 
 91.18     Sec. 9.  Minnesota Statutes 1994, section 274.01, 
 91.19  subdivision 1, is amended to read: 
 91.20     Subdivision 1.  [ORDINARY BOARD; MEETINGS, DEADLINES, 
 91.21  GRIEVANCES.] (a) The town board of a town, or the council or 
 91.22  other governing body of a city, is the board of review except in 
 91.23  cities whose charters provide for a board of equalization.  The 
 91.24  county assessor shall fix a day and time when the board or the 
 91.25  board of equalization shall meet in the assessment districts of 
 91.26  the county.  On or before February 15 of each year the assessor 
 91.27  shall give written notice of the time to the city or town 
 91.28  clerk.  Notwithstanding the provisions of any charter to the 
 91.29  contrary, the meetings must be held between April 1 and May 31 
 91.30  each year.  The clerk shall give published and posted notice of 
 91.31  the meeting at least ten days before the date of the 
 91.32  meeting.  If at least 25 percent of the net tax capacity of the 
 91.33  city or town is noncommercial seasonal recreational residential 
 91.34  property classified under section 273.13, subdivision 25, the 
 91.35  meeting or, if more than one meeting is scheduled, at least one 
 91.36  of the meetings must be held on a Saturday.  The Saturday 
 92.1   meeting date must be contained on the notice of valuation of 
 92.2   real property under section 273.121.  The board shall meet at 
 92.3   the office of the clerk to review the assessment and 
 92.4   classification of property in the town or city.  No changes in 
 92.5   valuation or classification which are intended to correct errors 
 92.6   in judgment by the county assessor may be made by the county 
 92.7   assessor after the board of review or the county board of 
 92.8   equalization has adjourned; however, corrections of errors that 
 92.9   are merely clerical in nature or changes that extend homestead 
 92.10  treatment to property are permitted after adjournment until the 
 92.11  tax extension date for that assessment year.  The changes must 
 92.12  be fully documented and maintained in the assessor's office and 
 92.13  must be available for review by any person.  A copy of the 
 92.14  changes made during this period must be sent to the county board 
 92.15  no later than December 31 of the assessment year.  
 92.16     (b) The board shall determine whether the taxable property 
 92.17  in the town or city has been properly placed on the list and 
 92.18  properly valued by the assessor.  If real or personal property 
 92.19  has been omitted, the board shall place it on the list with its 
 92.20  market value, and correct the assessment so that each tract or 
 92.21  lot of real property, and each article, parcel, or class of 
 92.22  personal property, is entered on the assessment list at its 
 92.23  market value.  No assessment of the property of any person may 
 92.24  be raised unless the person has been duly notified of the intent 
 92.25  of the board to do so.  On application of any person feeling 
 92.26  aggrieved, the board shall review the assessment or 
 92.27  classification, or both, and correct it as appears just.  
 92.28     (c) A local board of review may reduce assessments upon 
 92.29  petition of the taxpayer but the total reductions must not 
 92.30  reduce the aggregate assessment made by the county assessor by 
 92.31  more than one percent.  If the total reductions would lower the 
 92.32  aggregate assessments made by the county assessor by more than 
 92.33  one percent, none of the adjustments may be made.  The assessor 
 92.34  shall correct any clerical errors or double assessments 
 92.35  discovered by the board of review without regard to the one 
 92.36  percent limitation.  
 93.1      (d) A majority of the members may act at the meeting, and 
 93.2   adjourn from day to day until they finish hearing the cases 
 93.3   presented.  The assessor shall attend, with the assessment books 
 93.4   and papers, and take part in the proceedings, but must not 
 93.5   vote.  The county assessor, or an assistant delegated by the 
 93.6   county assessor shall attend the meetings.  The board shall list 
 93.7   separately, on a form appended to the assessment book, all 
 93.8   omitted property added to the list by the board and all items of 
 93.9   property increased or decreased, with the market value of each 
 93.10  item of property, added or changed by the board, placed opposite 
 93.11  the item.  The county assessor shall enter all changes made by 
 93.12  the board in the assessment book.  
 93.13     (e) If a person fails to appear in person, by counsel, or 
 93.14  by written communication before the board after being duly 
 93.15  notified of the board's intent to raise the assessment of the 
 93.16  property, or if a person feeling aggrieved by an assessment or 
 93.17  classification fails to apply for a review of the assessment or 
 93.18  classification, the person may not appear before the county 
 93.19  board of equalization for a review of the assessment or 
 93.20  classification.  This paragraph does not apply if an assessment 
 93.21  was made after the board meeting, as provided in section 273.01, 
 93.22  or if the person can establish not having received notice of 
 93.23  market value at least five days before the local board of review 
 93.24  meeting.  
 93.25     (f) The board of review or the board of equalization must 
 93.26  complete its work and adjourn within 20 days from the time of 
 93.27  convening stated in the notice of the clerk, unless a longer 
 93.28  period is approved by the commissioner of revenue.  No action 
 93.29  taken after that date is valid.  All complaints about an 
 93.30  assessment or classification made after the meeting of the board 
 93.31  must be heard and determined by the county board of 
 93.32  equalization.  A nonresident may, at any time, before the 
 93.33  meeting of the board of review file written objections to an 
 93.34  assessment or classification with the county assessor.  The 
 93.35  objections must be presented to the board of review at its 
 93.36  meeting by the county assessor for its consideration. 
 94.1      Sec. 10.  Minnesota Statutes 1994, section 276.131, is 
 94.2   amended to read: 
 94.3      276.131 [DISTRIBUTION OF PENALTIES, INTEREST, AND COSTS.] 
 94.4      The penalties, interest, and costs collected on special 
 94.5   assessments and real and personal property taxes must be 
 94.6   distributed as follows: 
 94.7      (1) all penalties and interest collected on special 
 94.8   assessments against real or personal property must be 
 94.9   distributed to the taxing jurisdiction that levied the 
 94.10  assessment; 
 94.11     (2) 50 percent of all penalties and interest collected on 
 94.12  real and personal property taxes must be distributed to the 
 94.13  county in which the property is located, and the other 50 
 94.14  percent must be distributed to the school district in which the 
 94.15  property is located districts within the county.  The 
 94.16  distribution to the school district must be in accordance with 
 94.17  the provisions of section 124.10; and 
 94.18     (3) all costs collected by the county on special 
 94.19  assessments and on delinquent real and personal property taxes 
 94.20  must be distributed to the county in which the property is 
 94.21  located.  
 94.22     Sec. 11.  Minnesota Statutes 1994, section 279.01, 
 94.23  subdivision 1, is amended to read: 
 94.24     Subdivision 1.  Except as provided in subdivision 3 or 4, 
 94.25  on May 16 or 21 days after the postmark date on the envelope 
 94.26  containing the property tax statement, whichever is later, a 
 94.27  penalty shall accrue and thereafter be charged upon all unpaid 
 94.28  taxes on real estate on the current lists in the hands of the 
 94.29  county treasurer.  The penalty shall be at a rate of two percent 
 94.30  on homestead property until May 31 and four percent on June 1.  
 94.31  The penalty on nonhomestead property shall be at a rate of four 
 94.32  percent until May 31 and eight percent on June 1.  This penalty 
 94.33  shall not accrue until June 1 of each year, or 21 days after the 
 94.34  postmark date on the envelope containing the property tax 
 94.35  statements, whichever is later, on commercial use real property 
 94.36  used for seasonal residential recreational purposes and 
 95.1   classified as class 1c or 4c, and on other commercial use real 
 95.2   property classified as class 3a, provided that over 60 percent 
 95.3   of the gross income earned by the enterprise on the class 3a 
 95.4   property is earned during the months of May, June, July, and 
 95.5   August.  Any property owner of such class 3a property who pays 
 95.6   the first half of the tax due on the property after May 15 and 
 95.7   before June 1, or 21 days after the postmark date on the 
 95.8   envelope containing the property tax statement, whichever is 
 95.9   later, shall attach an affidavit to the payment attesting to 
 95.10  compliance with the income provision of this subdivision.  
 95.11  Thereafter, for both homestead and nonhomestead property, on the 
 95.12  first day of each month beginning July 1, up to and including 
 95.13  October 1 following, an additional penalty of one percent for 
 95.14  each month shall accrue and be charged on all such unpaid taxes 
 95.15  provided that if the due date was extended beyond May 15 as the 
 95.16  result of any delay in mailing property tax statements no 
 95.17  additional penalty shall accrue if the tax is paid by the 
 95.18  extended due date.  If the tax is not paid by the extended due 
 95.19  date, then all penalties that would have accrued if the due date 
 95.20  had been May 15 shall be charged.  When the taxes against any 
 95.21  tract or lot exceed $50, one-half thereof may be paid prior to 
 95.22  May 16 or 21 days after the postmark date on the envelope 
 95.23  containing the property tax statement, whichever is later; and, 
 95.24  if so paid, no penalty shall attach; the remaining one-half 
 95.25  shall be paid at any time prior to October 16 following, without 
 95.26  penalty; but, if not so paid, then a penalty of two percent 
 95.27  shall accrue thereon for homestead property and a penalty of 
 95.28  four percent on nonhomestead property.  Thereafter, for 
 95.29  homestead property, on the first day of November an additional 
 95.30  penalty of four percent shall accrue and on the first day of 
 95.31  December following, an additional penalty of two percent shall 
 95.32  accrue and be charged on all such unpaid taxes.  Thereafter, for 
 95.33  nonhomestead property, on the first day of November and December 
 95.34  following, an additional penalty of four percent for each month 
 95.35  shall accrue and be charged on all such unpaid taxes.  If 
 95.36  one-half of such taxes shall not be paid prior to May 16 or 21 
 96.1   days after the postmark date on the envelope containing the 
 96.2   property tax statement, whichever is later, the same may be paid 
 96.3   at any time prior to October 16, with accrued penalties to the 
 96.4   date of payment added, and thereupon no penalty shall attach to 
 96.5   the remaining one-half until October 16 following.  
 96.6      This section applies to payment of personal property taxes 
 96.7   assessed against improvements to leased property, except as 
 96.8   provided by section 277.01, subdivision 3. 
 96.9      A county may provide by resolution that in the case of a 
 96.10  property owner that has multiple tracts or parcels with 
 96.11  aggregate taxes exceeding $50, payments may be made in 
 96.12  installments as provided in this subdivision. 
 96.13     The county treasurer may accept payments of more or less 
 96.14  than the exact amount of a tax installment due.  If the accepted 
 96.15  payment is less than the amount due, payments must be applied 
 96.16  first to the penalty accrued for the year the payment is made.  
 96.17  Acceptance of partial payment of tax does not constitute a 
 96.18  waiver of the minimum payment required as a condition for filing 
 96.19  an appeal under section 278.03 or any other law, nor does it 
 96.20  affect the order of payment of delinquent taxes under section 
 96.21  280.39. 
 96.22     Sec. 12.  Minnesota Statutes 1994, section 279.01, is 
 96.23  amended by adding a subdivision to read: 
 96.24     Subd. 4.  In the case of class 4c seasonal residential 
 96.25  recreational property not used for commercial purposes, 
 96.26  penalties shall accrue and be charged on unpaid taxes at the 
 96.27  times and at the rates provided in subdivision 1 for homestead 
 96.28  property. 
 96.29     Sec. 13.  [473.3915] [TRANSIT ZONES.] 
 96.30     Subdivision 1.  [DEFINITIONS.] For the purposes of this 
 96.31  section, the terms defined in subdivisions 2 and 3 have the 
 96.32  meaning given them. 
 96.33     Subd. 2.  [TRANSIT ROUTE.] "Transit route" means a route 
 96.34  along which transportation of passengers is provided by a motor 
 96.35  vehicle or other means of conveyance, including light rail 
 96.36  transit, by any person operating on a regular and continuing 
 97.1   basis as a common carrier on fixed routes and schedules.  
 97.2   "Transit route" does not include (1) a route along which 
 97.3   transportation is provided for children to or from school or for 
 97.4   passengers between a common carrier terminal station and a hotel 
 97.5   or motel, (2) transportation by common carrier railroad or by 
 97.6   taxi, (3) transportation furnished by a person solely for that 
 97.7   person's employees or customers, or (4) paratransit. 
 97.8      Subd. 3.  [TRANSIT ZONE.] "Transit zone" means the area 
 97.9   within one-quarter of a mile of a transit route that is also 
 97.10  within the metropolitan urban service area, as determined by the 
 97.11  council.  "Transit zone" includes any light rail transit route 
 97.12  for which funds for construction have been committed. 
 97.13     Subd. 4.  [TRANSIT ZONES; MAP AND PLAN.] For the purposes 
 97.14  of section 273.13, subdivision 24, the council shall designate 
 97.15  transit zones and identify them on a detailed map and in a 
 97.16  plan.  The council shall review the map and plan once a year and 
 97.17  revise them as necessary to indicate the current transit zones.  
 97.18  The council shall provide each county and city assessor in the 
 97.19  metropolitan area a copy of the current map and plan. 
 97.20     Sec. 14.  Minnesota Statutes 1994, section 477A.011, 
 97.21  subdivision 36, is amended to read: 
 97.22     Subd. 36.  [CITY AID BASE.] (a) Except as provided in 
 97.23  paragraph (b), "city aid base" means, for each city, the sum of 
 97.24  the local government aid and equalization aid it was originally 
 97.25  certified to receive in calendar year 1993 under Minnesota 
 97.26  Statutes 1992, section 477A.013, subdivisions 3 and 5, and the 
 97.27  amount of disparity reduction aid it received in calendar year 
 97.28  1993 under Minnesota Statutes 1992, section 273.1398, 
 97.29  subdivision 3. 
 97.30     (b) A city that in 1992 or 1993 transferred an amount from 
 97.31  governmental funds to its sewer and water fund, which amount 
 97.32  exceeded its net levy for taxes payable in the year in which the 
 97.33  transfer occurred, has a "city aid base" equal to the amount the 
 97.34  city was certified to receive in calendar year 1995 under 
 97.35  section 477A.013. 
 97.36     Sec. 15.  Laws 1992, chapter 511, article 2, section 45, is 
 98.1   amended by adding a subdivision to read: 
 98.2      Subd. 6a.  [HOUSING REDEVELOPMENT AUTHORITY; EXCEPTIONS.] 
 98.3   The requirements of subdivisions 2, 3, 4, and 5 do not apply in 
 98.4   order to qualify for the exemption if the student housing is 
 98.5   owned by the local housing and redevelopment authority, the 
 98.6   reduced cost of development due to the exemption is reflected in 
 98.7   lower rents, and a reasonable system is used to provide priority 
 98.8   to students in renting the dwelling units. 
 98.9      Sec. 16.  Laws 1992, chapter 511, article 2, section 45, 
 98.10  subdivision 7, is amended to read: 
 98.11     Subd. 7.  [EXPIRATION.] This section applies to student 
 98.12  housing approved by the state board before January 1, 1997.  The 
 98.13  property tax exemption for a student housing development is 
 98.14  limited to 20 years from the date of first occupancy.  This 
 98.15  section expires January 1, 2018. 
 98.16     Sec. 17.  Laws 1992, chapter 511, article 2, section 46, is 
 98.17  amended by adding a subdivision to read: 
 98.18     Subd. 6a.  [HOUSING REDEVELOPMENT AUTHORITY; EXCEPTIONS.] 
 98.19  The requirements of subdivisions 2, 3, 4, and 5 do not apply in 
 98.20  order to qualify for the exemption if the student housing is 
 98.21  owned by the local housing and redevelopment authority or by a 
 98.22  multicounty housing and redevelopment authority on land leased 
 98.23  from a city or school district, the reduced cost of development 
 98.24  due to the exemption is reflected in lower rents, and a 
 98.25  reasonable system is used to provide priority to students in 
 98.26  renting the dwelling units. 
 98.27     Sec. 18.  Laws 1992, chapter 511, article 2, section 46, 
 98.28  subdivision 7, is amended to read: 
 98.29     Subd. 7.  [EXPIRATION.] This section applies to student 
 98.30  housing approved by the state board before January 1, 1997.  The 
 98.31  property tax exemption for a student housing development is 
 98.32  limited to 20 years from the date of first occupancy.  This 
 98.33  section expires January 1, 2018. 
 98.34     Sec. 19.  [HACA REDUCTION; HENNEPIN COUNTY COURT 
 98.35  EMPLOYEES.] 
 98.36     There shall be deducted from the homestead and agricultural 
 99.1   credit aid payments to Hennepin county under Minnesota Statutes, 
 99.2   section 273.1398, an amount equal to $180,000 which represents 
 99.3   the cost to the state for the assumption of two Hennepin county 
 99.4   staff attorneys whose job function is that of court referees and 
 99.5   whose positions should have been transferred to the state as 
 99.6   part of the court takeover in Laws 1989, First Special Session 
 99.7   chapter 1, article 4.  One-half of the total amount shall be 
 99.8   deducted from each of the aid payments made in 1995 to Hennepin 
 99.9   county under Minnesota Statutes, section 273.1398.  The amount 
 99.10  of reduction made under this section shall be a permanent aid 
 99.11  reduction. 
 99.12     Sec. 20.  [TRANSIT ZONE MAP; DATE FIRST PRODUCED.] 
 99.13     The metropolitan council shall produce an initial version 
 99.14  of the transit zone map required under section 473.3915, 
 99.15  subdivision 4, by January 1, 1996. 
 99.16     Sec. 21.  [APPLICATION.] 
 99.17     Sections 13 and 20 apply in the counties of Anoka, Carver, 
 99.18  Dakota, Hennepin, Ramsey, Scott, and Washington. 
 99.19     Sec. 22.  [EFFECTIVE DATES.] 
 99.20     Section 1 is effective the day following final enactment.  
 99.21     Sections 2, 4, 5, and 8 are effective for taxes levied in 
 99.22  1995, payable in 1996, and thereafter, provided that the 
 99.23  provisions of section 4 restricting homestead classification for 
 99.24  seasonal recreational residential property applies to taxes 
 99.25  payable in 1996 and thereafter regardless of the date of 
 99.26  occupancy of the property or the date of filing of an 
 99.27  application for homestead classification by the relative of the 
 99.28  owner. 
 99.29     Section 3 is effective for improvements made in 1995 and 
 99.30  subsequent years. 
 99.31     Sections 6 and 9 are effective for 1996 assessments for 
 99.32  taxes payable in 1997 and subsequent years. 
 99.33     Sections 11 and 12 are effective for taxes levied in 1995, 
 99.34  payable in 1996, and thereafter. 
 99.35     Section 14 is effective for aids paid in 1996 and 
 99.36  thereafter.