SF 1533

as introduced - 83rd Legislature (2003 - 2004) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to local government aid; providing local 
  1.3             government aids to cities; authorizing an optional 
  1.4             local sales tax; amending Minnesota Statutes 2002, 
  1.5             sections 477A.011, subdivisions 27, 34, by adding 
  1.6             subdivisions; 477A.013, subdivision 9, by adding 
  1.7             subdivisions; 477A.03, subdivision 2; repealing 
  1.8             Minnesota Statutes 2002, sections 477A.011, 
  1.9             subdivisions 28, 29, 30, 31, 32, 33, 36, 37; 477A.03, 
  1.10            subdivision 4. 
  1.11  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.12     Section 1.  Minnesota Statutes 2002, section 477A.011, 
  1.13  subdivision 27, is amended to read: 
  1.14     Subd. 27.  [REVENUE BASE.] "Revenue base" means the amount 
  1.15  levied for taxes payable in the previous year, including the 
  1.16  levy on the fiscal disparity distribution under section 276A.06, 
  1.17  subdivision 3, paragraph (a), or 473F.08, subdivision 3, 
  1.18  paragraph (a), and before reduction for the homestead and 
  1.19  agricultural credit aid under section 273.1398, subdivision 2, 
  1.20  equalization aid under section 477A.013, subdivision 5, and 
  1.21  disparity reduction aid under section 273.1398, subdivision 3; 
  1.22  plus the originally certified local government aid in the 
  1.23  previous year under sections 477A.011 and 477A.013; and the 
  1.24  taconite aids received in the previous year under sections 
  1.25  298.28 and 298.282. 
  1.26     [EFFECTIVE DATE.] This section is effective beginning with 
  1.27  aids payable in 2004. 
  1.28     Sec. 2.  Minnesota Statutes 2002, section 477A.011, 
  2.1   subdivision 34, is amended to read: 
  2.2      Subd. 34.  [CITY REVENUE NEED PER CAPITA.] (a) For a 
  2.3   city with a population equal to or greater than 2,500, except a 
  2.4   city that is part of the central cities group, "city revenue 
  2.5   need per capita" is the sum of (1) 3.462312 times the pre-1940 
  2.6   housing percentage; plus (2) 2.093826 times the commercial 
  2.7   industrial percentage; plus (3) 6.862552 times the population 
  2.8   decline percentage; plus (4) .00026 times the city population; 
  2.9   plus (5) 152.0141 its group revenue base per capita, plus (2) 
  2.10  one-half of the amount that the city's revenue base per capita 
  2.11  exceeds its group revenue base per capita.  The total city 
  2.12  revenue need per capita for a city may not exceed 150 percent of 
  2.13  its group revenue base per capita. 
  2.14     (b) For a city with a population less than 2,500 that is 
  2.15  part of the central cities group, "city revenue need" is the sum 
  2.16  of (1) 1.795919 times the pre-1940 housing percentage; plus (2) 
  2.17  1.562138 times the commercial industrial percentage; plus (3) 
  2.18  4.177568 times the population decline percentage; plus (4) 
  2.19  1.04013 times the transformed population; minus (5) 107.475. 
  2.20     (c) The city revenue need cannot be less than zero. 
  2.21     (d) For calendar year 1998 and subsequent years, the city 
  2.22  revenue need for a city, as determined in paragraphs (a) to (c), 
  2.23  is multiplied by the ratio of the annual implicit price deflator 
  2.24  for government consumption expenditures and gross investment for 
  2.25  state and local governments as prepared by the United States 
  2.26  Department of Commerce, for the most recently available year to 
  2.27  the 1993 implicit price deflator for state and local government 
  2.28  purchases for aids payable in 2004 is equal to the group revenue 
  2.29  base per capita.  For aids payable in 2005 and future years, its 
  2.30  "city revenue need" is equal to (1) its city revenue need in the 
  2.31  previous year multiplied by (2) one plus the percentage increase 
  2.32  in the implicit price deflator for government consumption 
  2.33  expenditures and gross investment for state and local 
  2.34  governments prepared by the Bureau of Economic Analysis of the 
  2.35  United States Department of Commerce for the 12-month period 
  2.36  ending March 31 of the previous year. 
  3.1      [EFFECTIVE DATE.] This section is effective beginning with 
  3.2   aids payable in 2004. 
  3.3      Sec. 3.  Minnesota Statutes 2002, section 477A.011, is 
  3.4   amended by adding a subdivision to read: 
  3.5      Subd. 38.  [CITY GROUP.] "City group" for a city is the 
  3.6   cluster group that the city is assigned to by the League of 
  3.7   Minnesota Cities report "Clustering Minnesota Cities," October 
  3.8   2002. 
  3.9      [EFFECTIVE DATE.] This section is effective beginning with 
  3.10  aids payable in 2004. 
  3.11     Sec. 4.  Minnesota Statutes 2002, section 477A.011, is 
  3.12  amended by adding a subdivision to read: 
  3.13     Subd. 39.  [GROUP REVENUE BASE PER CAPITA.] The "group 
  3.14  revenue base per capita" for a city is equal to (1) the sum of 
  3.15  the revenue base for all cities assigned to its city group, 
  3.16  divided by (2) the sum of the population for all cities assigned 
  3.17  to its city group. 
  3.18     [EFFECTIVE DATE.] This section is effective beginning with 
  3.19  aids payable in 2004. 
  3.20     Sec. 5.  Minnesota Statutes 2002, section 477A.011, is 
  3.21  amended by adding a subdivision to read: 
  3.22     Subd. 40.  [HIGHER EDUCATION EXEMPT PROPERTY; EXEMPT 
  3.23  PROPERTY RATIO.] "Higher education exempt property" for a city 
  3.24  means the sum of the market value of exempt property, as 
  3.25  reported in the most recently available abstract of exempt 
  3.26  property for buildings, residences, and land of public and 
  3.27  nonpublic academies, colleges, and universities located in the 
  3.28  city.  A city's "exempt property ratio" is the ratio of (1) its 
  3.29  higher education exempt property to (2) the sum of its higher 
  3.30  education exempt property and the market value for the taxable 
  3.31  property located in the city in the same assessment year. 
  3.32     [EFFECTIVE DATE.] This section is effective beginning with 
  3.33  aids payable in 2004. 
  3.34     Sec. 6.  Minnesota Statutes 2002, section 477A.011, is 
  3.35  amended by adding a subdivision to read: 
  3.36     Subd. 41.  [EXEMPT PROPERTY INDICATOR.] "Exempt property 
  4.1   indicator" for a city is equal to the following: 
  4.2      (1) zero if its exempt property ratio is less than five 
  4.3   percent; 
  4.4      (2) one if its exempt property ratio is five percent or 
  4.5   more but less than ten percent; 
  4.6      (3) two if its exempt property ratio is ten percent or more 
  4.7   but less than 15 percent; 
  4.8      (4) three if its exempt property ratio is 15 percent or 
  4.9   more but less than 20 percent; 
  4.10     (5) four if its exempt property ratio is 20 percent or more 
  4.11  but less than 25 percent; and 
  4.12     (6) five if its exempt property ratio is 25 percent or more.
  4.13     [EFFECTIVE DATE.] This section is effective beginning with 
  4.14  aids payable in 2004. 
  4.15     Sec. 7.  Minnesota Statutes 2002, section 477A.011, is 
  4.16  amended by adding a subdivision to read: 
  4.17     Subd. 42.  [OVERBURDEN FACTOR.] "Overburden factor" for a 
  4.18  city means the population of all the cities and towns with a 
  4.19  geographic center that is within 50 miles of the geographic 
  4.20  center of the city.  If a city or town located in that area is 
  4.21  closer to a different city with a population greater than or 
  4.22  equal to that of the first city, its population is not included 
  4.23  in determining the overburden factor.  Only cities that are a 
  4.24  county seat and are located outside of the seven county 
  4.25  metropolitan area may have an overburden factor greater than 
  4.26  zero. 
  4.27     [EFFECTIVE DATE.] This section is effective beginning with 
  4.28  aids payable in 2004. 
  4.29     Sec. 8.  Minnesota Statutes 2002, section 477A.013, is 
  4.30  amended by adding a subdivision to read: 
  4.31     Subd. 8a.  [HIGHER EDUCATION EXEMPT AID.] In calendar year 
  4.32  2004 and subsequent years, the higher education exempt aid for a 
  4.33  city is equal to the number of students attending institutions 
  4.34  of higher education in the city multiplied by its exempt 
  4.35  property indicator and by a compensation percentage.  The 
  4.36  compensation percent must be the same for all cities and must be 
  5.1   calculated by the department of revenue to distribute 
  5.2   $10,000,000 annually under this subdivision.  For purposes of 
  5.3   this subdivision, "number of students" means the number of 
  5.4   students as reported by the Minnesota higher education services 
  5.5   office for the most recently available academic year. 
  5.6      [EFFECTIVE DATE.] This section is effective beginning with 
  5.7   aids payable in 2004. 
  5.8      Sec. 9.  Minnesota Statutes 2002, section 477A.013, is 
  5.9   amended by adding a subdivision to read: 
  5.10     Subd. 8b.  [REGIONAL OVERBURDEN AID.] In calendar year 2004 
  5.11  and subsequent years, the regional overburden aid for a city is 
  5.12  equal to its overburden factor multiplied by the overburden 
  5.13  compensation percent.  The overburden compensation percent must 
  5.14  be the same for all cities and must be calculated by the 
  5.15  department of revenue to distribute $10,000,000 annually under 
  5.16  this subdivision. 
  5.17     [EFFECTIVE DATE.] This section is effective beginning with 
  5.18  aids payable in 2004. 
  5.19     Sec. 10.  Minnesota Statutes 2002, section 477A.013, is 
  5.20  amended by adding a subdivision to read: 
  5.21     Subd. 8c.  [ATTACHED MACHINERY AID.] In calendar year 2004 
  5.22  and subsequent years, any city which received at least $70 per 
  5.23  capita in attached machinery aid in calendar year 1983 shall 
  5.24  receive an amount equal to the amount of attached machinery aid 
  5.25  it received in calendar year 1983. 
  5.26     [EFFECTIVE DATE.] This section is effective beginning with 
  5.27  aids payable in 2004. 
  5.28     Sec. 11.  Minnesota Statutes 2002, section 477A.013, 
  5.29  subdivision 9, is amended to read: 
  5.30     Subd. 9.  [CITY AID DISTRIBUTION.] (a) In calendar year 
  5.31  2002 2004 and thereafter, each city shall receive an aid 
  5.32  distribution equal to the sum of (1) the city its formula aid 
  5.33  under subdivision 8, and (2) its city aid base higher education 
  5.34  exempt aid, (3) its regional overburden aid, and (4) its 
  5.35  attached machinery aid. 
  5.36     (b) The percentage increase for a first class city in 
  6.1   calendar year 1995 2004 and thereafter, except for 2002, shall 
  6.2   not exceed the percentage increase in the sum of the aid to all 
  6.3   cities under this section in the current calendar year compared 
  6.4   to the sum of the aid to all cities in the previous year.  For 
  6.5   aids payable in 2002 only, the amount of the aid paid to a first 
  6.6   class city shall not exceed the sum of its aid amount for 
  6.7   calendar year 2001 under this section and its aid payment in 
  6.8   calendar year 2001 under section 273.1398, subdivision 2, by 
  6.9   more than 2.5 percent. 
  6.10     (c) For aids payable in all years except 2002 2004 and 
  6.11  thereafter, the total aid for any city, except a first class 
  6.12  city, shall not exceed the sum of (1) ten percent of the city's 
  6.13  net levy for the year prior to the aid distribution plus (2) its 
  6.14  total aid in the previous year.  For aids payable in 2002 only, 
  6.15  the total aid for any city, except a first class city, shall not 
  6.16  exceed the sum of (1) 40 percent of the city's net levy for 
  6.17  taxes payable in the year prior to the aid distribution plus (2) 
  6.18  40 percent of its total aid in the previous year under section 
  6.19  273.1398, subdivision 2, plus (3) its total aid in the previous 
  6.20  year under this section. 
  6.21     [EFFECTIVE DATE.] This section is effective beginning with 
  6.22  aids payable in 2004. 
  6.23     Sec. 12.  Minnesota Statutes 2002, section 477A.013, is 
  6.24  amended by adding a subdivision to read: 
  6.25     Subd. 10.  [TRANSITION AID.] In calendar year 2004 and 
  6.26  thereafter, if the amount of aid a city receives under 
  6.27  subdivision 9 is less than the amount it received in the 
  6.28  previous year under that subdivision, and the reduction is 
  6.29  greater than three percent of its city net tax capacity, it 
  6.30  shall receive transition aid under this subdivision.  The amount 
  6.31  of aid shall be equal to the difference between (1) the amount 
  6.32  of aid it received under subdivision 9 in the previous year, and 
  6.33  (2) the amount of aid it is certified to receive under 
  6.34  subdivision 9 in the current year plus an amount equal to three 
  6.35  percent of its city net tax capacity. 
  6.36     [EFFECTIVE DATE.] This section is effective beginning with 
  7.1   aids payable in 2004. 
  7.2      Sec. 13.  Minnesota Statutes 2002, section 477A.013, is 
  7.3   amended by adding a subdivision to read: 
  7.4      Subd. 11.  [OPTIONAL LOCAL SALES TAX.] Notwithstanding 
  7.5   section 477A.016, or any other provision of law, ordinance, or 
  7.6   charter, a city which qualifies for transition aid under 
  7.7   subdivision 10 may choose to forego the aid and instead, by 
  7.8   ordinance, impose a sales and use tax of one-half of one percent 
  7.9   within the city.  The city shall notify the commissioner of 
  7.10  revenue of its intent to forego transition aid and impose the 
  7.11  tax by October 1 of the year preceding the year in which the aid 
  7.12  is scheduled to be paid.  The proceeds of the tax may be used 
  7.13  for any general city purpose.  The provisions of section 
  7.14  297A.99, except for subdivisions 2 and 3, govern the imposition, 
  7.15  administration, collection, and enforcement of the tax 
  7.16  authorized under this subdivision. 
  7.17     [EFFECTIVE DATE.] This section is effective beginning with 
  7.18  aids payable in 2004. 
  7.19     Sec. 14.  Minnesota Statutes 2002, section 477A.03, 
  7.20  subdivision 2, is amended to read: 
  7.21     Subd. 2.  [ANNUAL APPROPRIATION.] (a) A sum sufficient to 
  7.22  discharge the duties imposed by sections 477A.011 to 477A.014 is 
  7.23  annually appropriated from the general fund to the commissioner 
  7.24  of revenue.  
  7.25     (b) Aid payments to counties under section 477A.0121 are 
  7.26  limited to $20,265,000 in 1996.  Aid payments to counties under 
  7.27  section 477A.0121 are limited to $27,571,625 in 1997.  For aid 
  7.28  payable in 1998 and thereafter, the total aids paid under 
  7.29  section 477A.0121 are the amounts certified to be paid in the 
  7.30  previous year, adjusted for inflation as provided under 
  7.31  subdivision 3. 
  7.32     (c)(i) For aids payable in 1998 and thereafter, the total 
  7.33  aids paid to counties under section 477A.0122 are the amounts 
  7.34  certified to be paid in the previous year, adjusted for 
  7.35  inflation as provided under subdivision 3. 
  7.36     (ii) Aid payments to counties under section 477A.0122 in 
  8.1   2000 are further increased by an additional $20,000,000 in 2000. 
  8.2      (d) Aid payments to cities in 2002 under section 477A.013, 
  8.3   subdivision 9, are limited to the amounts certified to be paid 
  8.4   in the previous year, adjusted for inflation as provided in 
  8.5   subdivision 3, and increased by $140,000,000.  For aids payable 
  8.6   in 2003, the total aids paid under section 477A.013, subdivision 
  8.7   9, are the amounts certified to be paid in the previous year, 
  8.8   adjusted for inflation as provided under subdivision 3.  For 
  8.9   aids payable in 2004, the total aids paid under section 
  8.10  477A.013, subdivision 9, are the amounts certified to be paid in 
  8.11  the previous year, adjusted for inflation as provided under 
  8.12  subdivision 3, and increased by the amount certified to be paid 
  8.13  in 2003 under section 477A.06 equal to $597,600,000.  For aids 
  8.14  payable in 2005 and thereafter, the total aids paid under 
  8.15  section 477A.013, subdivision 9, are the amounts certified to be 
  8.16  paid in the previous year, adjusted for inflation as provided 
  8.17  under subdivision 3.  The additional amount authorized under 
  8.18  subdivision 4 is not included when calculating the appropriation 
  8.19  limits under this paragraph. 
  8.20     (e) Reimbursements made to counties under section 477A.0123 
  8.21  in calendar year 2005 and thereafter are limited to an amount 
  8.22  equal to the maximum allowed appropriation under this section in 
  8.23  the previous year, multiplied by a percent to be established by 
  8.24  law.  If no percent is established by law, the appropriation is 
  8.25  limited to the total amount appropriated for this purpose in the 
  8.26  previous year. 
  8.27     [EFFECTIVE DATE.] This section is effective beginning with 
  8.28  aids payable in 2004. 
  8.29     Sec. 15.  [REPEALER.] 
  8.30     Minnesota Statutes 2002, sections 477A.011, subdivisions 
  8.31  28, 29, 30, 31, 32, 33, 36, and 37; 477A.03, subdivision 4, are 
  8.32  repealed. 
  8.33     [EFFECTIVE DATE.] This section is effective beginning with 
  8.34  aids payable in 2004.