as introduced - 80th Legislature (1997 - 1998) Posted on 12/15/2009 12:00am
1.1 A bill for an act 1.2 relating to finance; providing for school funding; 1.3 changing property class rates; expanding the property 1.4 tax refund program; providing a property tax refund to 1.5 certain businesses; providing for truth in budgeting; 1.6 modifying aids to local governments; exempting sales 1.7 of certain construction materials; imposing a future 1.8 schools facilities fee; changing the calculation of 1.9 fiscal disparities; requiring a study; appropriating 1.10 money; amending Minnesota Statutes 1996, sections 1.11 16A.103, subdivisions 1 and 2; 122.247, subdivision 3; 1.12 122.45, subdivision 3a; 122.531, subdivisions 4a and 1.13 9; 122.533; 122.535, subdivision 6; 124.17, 1.14 subdivision 1d; 124.239, subdivision 5; 124.2601, 1.15 subdivisions 2 and 3; 124.2711, subdivisions 1 and 5; 1.16 124.2713, subdivision 1; 124.2714; 124.2715, 1.17 subdivision 1; 124.2716, subdivision 2; 124.2725, 1.18 subdivisions 2, 6, 13, and 14; 124.2726, subdivisions 1.19 1 and 3; 124.2727, subdivision 6a; 124.312, 1.20 subdivision 5; 124.313; 124.4945; 124.83, subdivision 1.21 3; 124.91, subdivisions 1, 2, 5, and 7; 124.912, 1.22 subdivisions 1, 3, 6, and 7; 124.914, subdivisions 1, 1.23 2, 3, and 4; 124.916, subdivisions 1, 2, 3, and 4; 1.24 124.918, subdivision 8; 124A.22, subdivision 1; 1.25 124A.23, subdivision 1; 124A.292, subdivision 2; 1.26 273.13, subdivisions 24, 25, and by adding a 1.27 subdivision; 273.1398, subdivisions 1, 2, 3, and 8; 1.28 275.065, subdivisions 3, 5a, 6, and by adding a 1.29 subdivision; 275.08, subdivision 1b; 276.04, 1.30 subdivision 2; 276A.04; 276A.05, subdivisions 1 and 5; 1.31 276A.06, subdivisions 2, 3, and 5; 290A.04, 1.32 subdivisions 2 and 6; 297A.15, by adding a 1.33 subdivision; 297A.25, by adding a subdivision; 298.28, 1.34 subdivision 5, and by adding subdivisions; 469.177, 1.35 subdivisions 1a and 3; 473F.06; 473F.07, subdivisions 1.36 1 and 5; 473F.08, subdivisions 2, 3, and 5; 477A.011, 1.37 subdivisions 20, 35, 37, and by adding subdivisions; 1.38 477A.013, subdivisions 1, 8, and 9; 477A.014, by 1.39 adding a subdivision; and 477A.03, subdivisions 2 and 1.40 3; proposing coding for new law in Minnesota Statutes, 1.41 chapters 281A; and 477A; proposing coding for new law 1.42 as Minnesota Statutes, chapter 290B; repealing 1.43 Minnesota Statutes 1996, sections 124.2134; 124.225, 1.44 subdivisions 1, 3a, 7a, 7b, 7d, 7e, 7f, 8a, 8k, 8l, 1.45 8m, 9, 10, 13, 14, 15, 16, and 17; 124.226; 124.2442; 1.46 124.2601, subdivisions 4, 5, and 6; 124.2711, 2.1 subdivisions 2a and 3; 124.2713, subdivisions 6, 6a, 2.2 6b, and 7; 124.2715, subdivisions 2 and 3; 124.2716, 2.3 subdivisions 3 and 4; 124.2725, subdivisions 3, 4, 5, 2.4 and 7; 124.2727, subdivisions 6b, 6c, and 9; 124.314, 2.5 subdivision 2; 124.321; 124.91, subdivision 4; 2.6 124.912, subdivision 2; 124A.22, subdivisions 4a, 4b, 2.7 8a, 8b, 13d, and 13e; 124A.23, subdivisions 2, 3, and 2.8 4; 124A.26, subdivisions 2 and 3; 124A.292, 2.9 subdivisions 3 and 4; 124A.697; 124A.698; 124A.70, 2.10 subdivisions 1, 2, 3a, and 5; 124A.71; 124A.711; 2.11 124A.72; 124A.73; 273.13, subdivision 32; 276A.06, 2.12 subdivision 9; 473F.08, subdivision 8a; 477A.014, 2.13 subdivision 5; and 477A.05; Laws 1992, chapter 499, 2.14 article 7, section 31. 2.15 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 2.16 ARTICLE 1 2.17 SCHOOL FUNDING 2.18 Section 1. Minnesota Statutes 1996, section 122.247, 2.19 subdivision 3, is amended to read: 2.20 Subd. 3. [TRANSITIONALLEVYREVENUE.] The board of the 2.21 combined district, or the boards of combining districts that 2.22 have received voter approval for the combination under section 2.23 122.243, subdivision 2,may levyare eligible for state aid to 2.24 pay for the expenses of negotiation, administrative expenses 2.25 directly related to the transition from cooperation to 2.26 combination, and the cost of necessary new athletic and music 2.27 uniforms.The board or boards may levy this amount over three2.28or fewer years.All expenses must be approved by the 2.29 commissioner of children, families, and learning. The 2.30 commissioner may pay this state aid to a district over three or 2.31 fewer years. 2.32 Sec. 2. Minnesota Statutes 1996, section 122.45, 2.33 subdivision 3a, is amended to read: 2.34 Subd. 3a. (a) Liabilities of a dissolved district existing 2.35 at the time of the attachment other than bonded debt within the 2.36 purview of subdivision 2 shall be obligations of the 2.37 consolidated district after attachment (in the amount and kind 2.38 determined by the commissioner according to subdivision 1, where 2.39 a dissolved district is divided), for the payment of which the 2.40 consolidated district has a right to reimbursement byspecial2.41levy or leviesstate aid. The amount of reimbursement will be 2.42 equal to the liabilities of the dissolved district for which the 3.1 consolidated district is obligated less the aggregate of the 3.2 following which has been or will be received by the consolidated 3.3 district at or after the time of attachment from or as a result 3.4 of the dissolution and attachment of the dissolved district: 3.5 (1) all taxes inuring to the consolidating district upon 3.6 levies made by the dissolved district; 3.7 (2) all cash, bank accounts, investments, and other current 3.8 assets; 3.9 (3) earned state aids of the dissolved districts; 3.10 (4) returns from the sale of property of the dissolved 3.11 district. 3.12 (b) The amount ofsuch special levy so computed shall be3.13certified to the county auditor with the other tax requirements3.14of the consolidated district but separately stated and3.15identified. The auditor shall add the amount of special levy so3.16certified to the school rate for the territory in the3.17consolidated district which came from the dissolved district and3.18include it in the levy on the taxable property in that3.19territory; provided, the county auditor shall not spread more of3.20the amount certified for special levy in any year than will3.21amount to 20 percent of the school levy without the special3.22levy, leaving the remaining part of the certified amount for3.23levy in successive years without further certification. Any3.24amount of reimbursement to which it is entitled omitted by the3.25consolidated district from its initial certification for special3.26levy may be certified in a subsequent year for levy in the same3.27manner as the levy upon initial certification.3.28The levy authorized by this subdivision shall be in3.29addition to those otherwise authorized for a school district.3.30 state aid shall be calculated by the commissioner and may be 3.31 reduced at the commissioner's discretion for any liabilities 3.32 that the commissioner determines are inappropriate for 3.33 reimbursement. 3.34 Sec. 3. Minnesota Statutes 1996, section 122.531, 3.35 subdivision 4a, is amended to read: 3.36 Subd. 4a. [REORGANIZATION OPERATING DEBTLEVIESREVENUE.] 4.1 (a) A district that receives revenue under section 124.2725 for 4.2 cooperation or has combined according to sections 122.241 to 4.3 122.248may levyis eligible for state aid to eliminate 4.4 reorganization operating debt as defined in section 121.915, 4.5 clause (1).The amount of the debt must be certified over a4.6period of five years. After the effective date of combination4.7according to sections 122.241 to 122.248, the levy may be4.8certified and spread either4.9(1) only on the property in the combined district that4.10would have been taxable in the preexisting district that4.11incurred the debt, or4.12(2) on all of the taxable property in the combined district.4.13 (b) A district that has reorganized according to section 4.14 122.22 or 122.23may levyis eligible for state aid to eliminate 4.15 reorganization operating debt as defined in section 121.915, 4.16 clause (2).The amount of debt must be certified over a period4.17not to exceed five years and may be spread either4.18(1) only on the property in the newly created or enlarged4.19district which was taxable in the preexisting district that4.20incurred the debt, or4.21(2) on all of the taxable property in the newly created or4.22enlarged district.4.23 (c) The commissioner shall calculate the amount of 4.24 reorganization operating debt for each qualifying school 4.25 district. At the commissioner's discretion, the amount of the 4.26 state aid may be reduced for any school district. The 4.27 commissioner shall establish a schedule for the payment of state 4.28 aid. The schedule may extend for up to five years. 4.29 Sec. 4. Minnesota Statutes 1996, section 122.531, 4.30 subdivision 9, is amended to read: 4.31 Subd. 9. [LEVYREVENUE FOR SEVERANCE PAY OR EARLY 4.32 RETIREMENT INCENTIVES.] The school board of a newly created or 4.33 enlarged district to which part or all of a dissolved district 4.34 was attached according to section 122.22may levy foris 4.35 eligible for state aid payments for the cost of severance pay or 4.36 early retirement incentives for licensed and nonlicensed 5.1 employees who resign or retire early as a result of the 5.2 dissolution or consolidation, if the commissioner of children, 5.3 families, and learning approves the incentives and the amountto5.4be levied. The amount may be levied over a period of up to five5.5years and shall be spread in whole or in part on the property of5.6a preexisting district or the newly created or enlarged5.7district, as determined by the school board of the newly created5.8or enlarged districtof the incentives. The commissioner shall 5.9 establish a schedule for the payment of state aid. The schedule 5.10 may extend for up to five years. 5.11 Sec. 5. Minnesota Statutes 1996, section 122.533, is 5.12 amended to read: 5.13 122.533 [EXPENSES OF TRANSITION.] 5.14 The board of a district to which a dissolved district is 5.15 attached pursuant to section 122.22,may,is eligible for state 5.16 aid for the purpose of paying the expenses of negotiations and 5.17 other administrative expenses relating to the transition,. The 5.18 board of the district may enter into agreements with banks or 5.19 any person to take its orders at any rate of interest not to 5.20 exceed seven percent per annum. These orders shall be paid by 5.21 the treasurer of the district from district funds after the 5.22 effective date of the dissolution and attachment. 5.23 Notwithstanding the provisions of sections 124.226, 124.2716, 5.24 124.91, 124.912, 124.914, 124.916, and 124.918, the districtmay5.25 is, in the year the dissolution and attachment becomes 5.26 effective,levyeligible for state aid in an amount equal to the 5.27 amount of the orders issued pursuant to this subdivision and the 5.28 interest on these orders. No district shall issue orders for 5.29 fundsor make a levy pursuantaccording to this subdivision 5.30 without the commissioner's approval of the expenses to be paid 5.31 with the funds from the orders andlevystate aid. 5.32 Sec. 6. Minnesota Statutes 1996, section 122.535, 5.33 subdivision 6, is amended to read: 5.34 Subd. 6. [SEVERANCE PAY.] A district shall pay severance 5.35 pay to a teacher who is placed on unrequested leave of absence 5.36 by the district as a result of the agreement. A teacher is 6.1 eligible under this subdivision if the teacher: 6.2 (1) is a teacher, as defined in section 125.12, subdivision 6.3 1, but not a superintendent; 6.4 (2) has a continuing contract with the district according 6.5 to section 125.12, subdivision 4. 6.6 The amount of severance pay shall be equal to the teacher's 6.7 salary for the school year during which the teacher was placed 6.8 on unrequested leave of absence minus the gross amount the 6.9 teacher was paid during the 12 months following the teacher's 6.10 termination of salary, by an entity whose teachers by statute or 6.11 rule must possess a valid Minnesota teaching license, and minus 6.12 the amount a teacher receives as severance or other similar pay 6.13 according to a contract with the district or district policy. 6.14 These entities include, but are not limited to, the school 6.15 district that placed the teacher on unrequested leave of 6.16 absence, another school district in Minnesota, an education 6.17 district, an intermediate school district, a SC, a board formed 6.18 under section 471.59, a state residential academy, the Lola and 6.19 Rudy Perpich Minnesota center for arts education, a vocational 6.20 center, or a special education cooperative. These entities do 6.21 not include a school district in another state, a Minnesota 6.22 public post-secondary institution, or a state agency. Only 6.23 amounts earned by the teacher as a substitute teacher or in a 6.24 position requiring a valid Minnesota teaching license shall be 6.25 subtracted. A teacher may decline any offer of employment as a 6.26 teacher without loss of rights to severance pay. 6.27 To determine the amount of severance pay that is due for 6.28 the first six months following termination of the teacher's 6.29 salary, the district may require the teacher to provide 6.30 documented evidence of the teacher's employers and gross 6.31 earnings during that period. The district shall pay the teacher 6.32 the amount of severance pay it determines to be due from the 6.33proceeds of the levystate aid for this purpose. To determine 6.34 the amount of severance pay that is due for the second six 6.35 months of the 12 months following the termination of the 6.36 teacher's salary, the district may require the teacher to 7.1 provide documented evidence of the teacher's employers and gross 7.2 earnings during that period. The district shall pay the teacher 7.3 the amount of severance pay it determines to be due from 7.4 theproceeds of the levystate aid for this purpose. 7.5 A teacher who receives severance pay under this subdivision 7.6 waives all further reinstatement rights under section 125.12, 7.7 subdivision 6a or 6b. If the teacher receives severance pay, 7.8 the teacher shall not receive credit for any years of service in 7.9 the district paying severance pay prior to the year in which the 7.10 teacher becomes eligible to receive severance pay. 7.11 The severance pay is subject to section 465.72. The 7.12 districtmay levy annuallyis eligible for state aid according 7.13 to section 124.912, subdivision 1, for the severance pay. 7.14 Sec. 7. Minnesota Statutes 1996, section 124.17, 7.15 subdivision 1d, is amended to read: 7.16 Subd. 1d. [AFDC PUPIL UNITS.] AFDC pupil units for fiscal 7.17 year19932000 and thereafter must be computed according to this 7.18 subdivision. 7.19 (a) The AFDC concentration percentage for a district equals 7.20 the product of 100 times the ratio of: 7.21 (1) the number of pupils enrolled in the district from 7.22 families receiving aid to families with dependent children 7.23 according to subdivision 1e; to 7.24 (2) the number of pupils in average daily membership 7.25 according to subdivision 1e enrolled in the district. 7.26 (b) The AFDC pupil weighting factor for a district equals 7.27 the lesser of one or the quotient obtained by dividing the 7.28 district's AFDC concentration percentage by11.512.9. 7.29 (c) The AFDC pupil units for a district for fiscal year 7.3019932000 and thereafter equals the product of: 7.31 (1) the number of pupils enrolled in the district from 7.32 families receiving aid to families with dependent children 7.33 according to subdivision 1e; times 7.34 (2) the AFDC pupil weighting factor for the district; times 7.35 (3).67.75. 7.36 Sec. 8. Minnesota Statutes 1996, section 124.239, 8.1 subdivision 5, is amended to read: 8.2 Subd. 5. [LEVY AUTHORIZED.] A district, after local board 8.3 approval, may levy for costs related to an approved facility 8.4 plan as follows: 8.5 (a) if the district has indicated to the commissioner that 8.6 bonds will be issued, the district may levy for the principal 8.7 and interest payments on outstanding bonds issued according to 8.8 subdivision 3; or 8.9 (b) if the district has indicated to the commissioner that 8.10 the plan will be funded through levy, the district may levy 8.11 according to the schedule approved in the plan. 8.12 The authority to levy for costs related to an approved 8.13 facility plan under this section is limited to facilities plans 8.14 approved prior to July 1, 1997. 8.15 Sec. 9. Minnesota Statutes 1996, section 124.2601, 8.16 subdivision 2, is amended to read: 8.17 Subd. 2. [PROGRAMS FUNDED.] Adult basic education programs 8.18 established under section 124.26 and approved by the 8.19 commissioner are eligible forrevenueaid under this section. 8.20 Sec. 10. Minnesota Statutes 1996, section 124.2601, 8.21 subdivision 3, is amended to read: 8.22 Subd. 3. [AID.] Adult basic education aid for each 8.23 approved program equals the sum of 65 percent of the general 8.24 education formula allowance times the number of full-time 8.25 equivalent students in its adult basic education program and an 8.26 amount equal to .12 percent times the district's adjusted net 8.27 tax capacity for assessment year 1996. 8.28 Sec. 11. Minnesota Statutes 1996, section 124.2711, 8.29 subdivision 1, is amended to read: 8.30 Subdivision 1. [REVENUEAID.]The revenueState aid for 8.31 early childhood family education programs for a school district 8.32 equals $101.25for 1993 and later fiscal yearstimes the greater 8.33 of: 8.34 (1) 150; or 8.35 (2) the number of people under five years of age residing 8.36 in the school district on October 1 of the previous school year. 9.1 Sec. 12. Minnesota Statutes 1996, section 124.2711, 9.2 subdivision 5, is amended to read: 9.3 Subd. 5. [HOME VISITINGLEVYAID.] A school district that 9.4 enters into a collaborative agreement to provide education 9.5 services and social services to families with young childrenmay9.6levy an amountis eligible for state aid equal to $1.60 times 9.7 the number of people under five years of age residing in the 9.8 district on September 1 of the last school year.Levy revenue9.9under this subdivision shall not be included as revenue under9.10subdivision 1.The revenue shall be used for home visiting 9.11 programs under section 121.882, subdivision 2b. 9.12 Sec. 13. Minnesota Statutes 1996, section 124.2713, 9.13 subdivision 1, is amended to read: 9.14 Subdivision 1. [TOTAL COMMUNITY EDUCATION REVENUE.] 9.15 Community education revenue equals the sum of a district's 9.16 general community education revenue and youth service program 9.17 revenue. Community education revenue is provided entirely 9.18 through state aid. 9.19 Sec. 14. Minnesota Statutes 1996, section 124.2714, is 9.20 amended to read: 9.21 124.2714 [ADDITIONAL COMMUNITY EDUCATION REVENUE.] 9.22 (a) A district that is eligible under section 124.2713, 9.23 subdivision 2,may levy an amount upis eligible for aid equal 9.24 to the amount of revenue authorized by Minnesota Statutes 1986, 9.25 section 275.125, subdivision 8, clause (2). 9.26 (b) Beginning withleviesrevenue for fiscal year 1995, 9.27 thislevyrevenue must be reduced each year by the amount of any 9.28 increase in thelevyingdistrict's general community education 9.29 revenue under section 124.2713, subdivision 3, for that fiscal 9.30 year over the amount received by the district under section 9.31 124.2713, subdivision 3, for fiscal year 1994. 9.32 (c) Theproceeds of the levyrevenue may be used for the 9.33 purposes set forth in section 124.2713, subdivision 8. 9.34 Sec. 15. Minnesota Statutes 1996, section 124.2715, 9.35 subdivision 1, is amended to read: 9.36 Subdivision 1. [REVENUE AMOUNT.] A district that is 10.1 eligible according to section 124.2713, subdivision 2, may 10.2 receive revenue for a program for adults with disabilities. 10.3 Revenue for the program for adults with disabilities for a 10.4 district or a group of districts equals the lesser of: 10.5 (1) the actual expenditures for approved programs and 10.6 budgets; or 10.7 (2) $60,000. 10.8 Revenue is provided through state aid. 10.9 Sec. 16. Minnesota Statutes 1996, section 124.2716, 10.10 subdivision 2, is amended to read: 10.11 Subd. 2. [EXTENDED DAY REVENUE.] The extended day revenue 10.12 for an eligible school district equals the approved additional 10.13 cost of providing services to children with disabilities or 10.14 children experiencing family or related problems of a temporary 10.15 nature who participate in the extended day program. Extended 10.16 day revenue is provided through state aid. 10.17 Sec. 17. Minnesota Statutes 1996, section 124.2725, 10.18 subdivision 2, is amended to read: 10.19 Subd. 2. [COOPERATION AND COMBINATION REVENUE.] 10.20 Cooperation and combination revenue equals $100 times the pupil 10.21 units served in the district. For purposes of this section, 10.22 pupil units served means the number of resident and nonresident 10.23 pupil units in average daily membership receiving instruction in 10.24 the cooperating or combined district. A district may not 10.25 receive revenue under this section if itleviesreceives revenue 10.26 under section 124.912, subdivision 4. Cooperation and 10.27 combination revenue is provided through state aid. 10.28 Sec. 18. Minnesota Statutes 1996, section 124.2725, 10.29 subdivision 6, is amended to read: 10.30 Subd. 6. [ADDITIONAL AID.] In addition to the aid in 10.31 subdivision52, districts shall receive aid according to the 10.32 following: 10.33 (1) for districts that did not enter into an agreement 10.34 under section 122.541 at least three years before the date of a 10.35 successful referendum held under section 122.243, subdivision 2, 10.36 and combine without cooperating, $100 times the pupil units 11.1 served in the district in the first year of combination; or 11.2 (2) for districts that combine after one or two years of 11.3 cooperation, $100 times the actual pupil units served in each 11.4 district for the first year of cooperation and $100 times the 11.5 actual pupil units served in the combined district for the first 11.6 year of combination; or 11.7 (3) for districts that entered into an agreement under 11.8 section 122.541 at least three years before the date of a 11.9 successful referendum held under section 122.243, subdivision 2, 11.10 and combine without cooperating, $100 times the pupil units 11.11 served in the combined district for the first two years of 11.12 combination. 11.13 Sec. 19. Minnesota Statutes 1996, section 124.2725, 11.14 subdivision 13, is amended to read: 11.15 Subd. 13. [FAILURE TO COMBINE.] A district has failed to 11.16 combine if the commissioner disapproves of the plan according to 11.17 section 122.243, subdivision 1, or if a third referendum fails 11.18 under section 122.243, subdivision 2, or if the commissioner of 11.19 children, families, and learning determines that the districts 11.20 involved are not making sufficient progress toward combination. 11.21 (a) If a district has failed to combine, cooperation and 11.22 combination aid under subdivisions 5 and 6 shall not be paidand11.23the authority to levy under subdivision 4 ceases. The 11.24 commissioner shall reduce other aids due the district to recover 11.25 an amount equal to the aid paid under subdivision 6 plus the 11.26 difference between the aid paid under subdivision 5 and the aid 11.27 that would have been paid if the revenue had been $50 times the 11.28 pupil units served. 11.29 (b) If a district has failed to combine, theauthority to11.30levyeligibility for revenue for reorganization operating debt 11.31 under section 122.531, subdivision 4a, and for severance pay or 11.32 early retirement incentives under subdivision 15 ceases. 11.33 Sec. 20. Minnesota Statutes 1996, section 124.2725, 11.34 subdivision 14, is amended to read: 11.35 Subd. 14. [CESSATION OF REVENUE.] At any time the 11.36 districts cease cooperating, aid shall not be paidand the12.1authority to levy ceases. If a district ceases to cooperate for12.2all or a portion of a fiscal year for which a levy has been12.3certified under subdivision 3, the department of children,12.4families, and learning shall adjust the next levy certified by12.5the district by an amount in proportion to the part of the12.6fiscal year that the district did not cooperate. 12.7 Sec. 21. Minnesota Statutes 1996, section 124.2726, 12.8 subdivision 1, is amended to read: 12.9 Subdivision 1. [ELIGIBILITY AND USE.] A school district 12.10 that has been reorganized after June 30, 1994, under section 12.11 122.23 is eligible for consolidation transition revenue. 12.12 Revenue is equal to the sum of aid undersubdivision12.13 subdivisions 2 andlevy under subdivision3. Consolidation 12.14 transition revenue may only be used according to this section. 12.15 Revenue must be used for the following purposes and may be 12.16 distributed among these purposes at the discretion of the 12.17 district: 12.18 (1) to offer early retirement incentives as provided by 12.19 section 122.23, subdivision 20; 12.20 (2) to reduce operating debt as defined in section 121.915; 12.21 (3) to enhance learning opportunities for students in the 12.22 reorganized district; and 12.23 (4) for other costs incurred in the reorganization. 12.24 Revenue received and utilized under clause (3) or (4) may 12.25 be expended for operating, facilities, and/or equipment. 12.26 Revenue received under this section shall not be included in the 12.27 determination of the reduction under section 124A.26, 12.28 subdivision 1. 12.29 Sec. 22. Minnesota Statutes 1996, section 124.2726, 12.30 subdivision 3, is amended to read: 12.31 Subd. 3. [LEVYADDITIONAL AID.] If the aid available in 12.32 subdivision 2 is insufficient to cover the costs of the district 12.33 under section 122.23, subdivision 20, the district maylevy12.34 apply to the commissioner for state aid to cover the difference 12.35over a period of time not to exceed. The commissioner shall 12.36 evaluate the aid request and may award additional aid for a 13.1 period not to exceed three years. 13.2 Sec. 23. Minnesota Statutes 1996, section 124.2727, 13.3 subdivision 6a, is amended to read: 13.4 Subd. 6a. [DISTRICT COOPERATION REVENUE.] A district's 13.5 cooperation revenue is equal to the greater of $67 times the 13.6 actual pupil units or $25,000. District cooperation revenue is 13.7 provided through state aid. 13.8 Sec. 24. Minnesota Statutes 1996, section 124.312, 13.9 subdivision 5, is amended to read: 13.10 Subd. 5. [INTEGRATION AID.]For fiscal year 1996 and later13.11fiscal yearsIntegration revenue is provided through state aid 13.12 and equals the following amounts: 13.13 (1) for independent school district No. 709, Duluth, 13.14 $1,385,000 plus the sum of $660,000 and an amount equal to 2.0 13.15 percent times the district's adjusted net tax capacity for 13.16 assessment year 1994; 13.17 (2) for independent school district No. 625, St. Paul, 13.18 $8,090,700 plus the product of $197 and the district's actual 13.19 pupil units for that year; and 13.20 (3) for special school district No. 1, Minneapolis, 13.21 $9,368,300 plus the product of $197 and the district's actual 13.22 pupil units for that year. 13.23 Sec. 25. Minnesota Statutes 1996, section 124.313, is 13.24 amended to read: 13.25 124.313 [TARGETED NEEDS REVENUE.] 13.26 For fiscal year 1996 and thereafter, a school district's 13.27 targeted needs revenue equals the sum of: 13.28 (1) assurance of mastery revenue according to section 13.29 124.311; plus 13.30 (2) the district's limited English proficiency revenue 13.31 computed according to section 124.273, subdivision 1d; plus 13.32 (3) integration revenue computed according to section 13.33 124.312, subdivision 4. 13.34 Sec. 26. Minnesota Statutes 1996, section 124.4945, is 13.35 amended to read: 13.36 124.4945 [LEVYSTATE AID FOR SEVERANCE PAY.] 14.1 A joint powers board established under section 124.494may14.2make a levyis eligible to receive state aid to provide 14.3 severance pay and early retirement incentives under section 14.4 125.611, for any teacher as defined under section 125.12, 14.5 subdivision 1, who is placed on unrequested leave as a result of 14.6 the cooperative secondary facility agreement.A joint powers14.7board making a levy shall certify to each participating district14.8tax levies sufficient to raise the amount necessary to provide14.9the district's portion of severance pay and early retirement14.10incentives. The tax levy certified to each district must be14.11expressed as a local tax rate, that, when applied to the14.12adjusted net tax capacity of all of the participating districts14.13raises the amount necessary to provide severance pay and early14.14retirement incentives. Each participating school district shall14.15include the levy in the next tax roll which it shall certify to14.16the county auditor, and shall remit the collections of the levy14.17to the joint powers board.The commissioner shall approve any 14.18 severance pay agreements or early retirement incentives and 14.19 determine the amount of state aid for the districts. 14.20 Sec. 27. Minnesota Statutes 1996, section 124.83, 14.21 subdivision 3, is amended to read: 14.22 Subd. 3. [HEALTH AND SAFETY REVENUE.] A district's health 14.23 and safety revenue for a fiscal year equals: 14.24 (1) the sum of (a) the total approved cost of the 14.25 district's hazardous substance plan for fiscal years 1985 14.26 through 1989, plus (b) the total approved cost of the district's 14.27 health and safety program for fiscal year 1990 through the 14.28 fiscal year to which the levy is attributable, minus 14.29 (2) the sum of (a) the district's total hazardous substance 14.30 aid and levy for fiscal years 1985 through 1989 under sections 14.31 124.245 and 275.125, subdivision 11c, plus (b) the district's 14.32 health and safety revenue under this subdivision, for years 14.33 before the fiscal year to which the levy is attributable, plus 14.34 (c) the amount of other federal, state, or local receipts for 14.35 the district's hazardous substance or health and safety programs 14.36 for fiscal year 1985 through the fiscal year to which the levy 15.1 is attributable. 15.2 The commissioner shall not approve any new health and 15.3 safety revenue plans after July 1, 1997. 15.4 Sec. 28. Minnesota Statutes 1996, section 124.91, 15.5 subdivision 1, is amended to read: 15.6 Subdivision 1. [TO LEASE BUILDING OR LAND.] When a 15.7 district finds it economically advantageous to rent or lease a 15.8 building or land for any instructional purposes or for school 15.9 storage or furniture repair, and it determines that the capital 15.10 expenditure facilities revenues authorized under sections 15.11 124.243 and 124A.22, subdivision 10, are insufficient for this 15.12 purpose, it may apply to the commissioner for permission to make 15.13 an additional capital expenditure levy for this purpose. The 15.14 commissioner shall not approve any levies under this section 15.15 after July 1, 1997. A school district that has approved levy 15.16 authority under this section may continue to levy for the 15.17 remainder of the lease amounts. An application for permission 15.18 to levy under this subdivision must contain financial 15.19 justification for the proposed levy, the terms and conditions of 15.20 the proposed lease, and a description of the space to be leased 15.21 and its proposed use. The criteria for approval of applications 15.22 to levy under this subdivision must include: the reasonableness 15.23 of the price, the appropriateness of the space to the proposed 15.24 activity, the feasibility of transporting pupils to the leased 15.25 building or land, conformity of the lease to the laws and rules 15.26 of the state of Minnesota, and the appropriateness of the 15.27 proposed lease to the space needs and the financial condition of 15.28 the district. The commissioner must not authorize a levy under 15.29 this subdivision in an amount greater than the cost to the 15.30 district of renting or leasing a building or land for approved 15.31 purposes. The proceeds of this levy must not be used for 15.32 custodial or other maintenance services. A district may not 15.33 levy under this subdivision for the purpose of leasing or 15.34 renting a district-owned building to itself. 15.35 Sec. 29. Minnesota Statutes 1996, section 124.91, 15.36 subdivision 2, is amended to read: 16.1 Subd. 2. [PRE-JULY 1990 LEASE PURCHASE, INSTALLMENT BUYS.] 16.2 For taxes payable prior to 1998, a district may annually levy 16.3 the amount needed to make payments required by a lease purchase 16.4 agreement, installment purchase agreement, or other deferred 16.5 payment agreement authorized by Minnesota Statutes 1989 16.6 Supplement, section 465.71, if: 16.7 (1) the agreement was approved by the commissioner before 16.8 July 1, 1990, according to Minnesota Statutes 1989 Supplement, 16.9 section 275.125, subdivision 11d; or 16.10 (2) the district levied in 1989 for the payments. 16.11 For fiscal years 1999 and later, the commissioner shall pay 16.12 state aid to each district in the amount needed to make the 16.13 payments authorized by this section. 16.14 Sec. 30. Minnesota Statutes 1996, section 124.91, 16.15 subdivision 5, is amended to read: 16.16 Subd. 5. [INTERACTIVE TELEVISION.] (a) A school district 16.17 with its central administrative office located within economic 16.18 development region one, two, three, four, five, six, seven, 16.19 eight, nine, and ten may apply to the commissioner of children, 16.20 families, and learning for ITV revenue up to the greater of .5 16.21 percent of the adjusted net tax capacity of the district or 16.22 $25,000 for the construction, maintenance, and lease costs of an 16.23 interactive television system for instructional purposes. The 16.24 approval by the commissioner of children, families, and learning 16.25 and the application procedures set forth in subdivision 1 shall 16.26 apply to the revenue in this subdivision. In granting the 16.27 approval, the commissioner must consider whether the district is 16.28 maximizing efficiency through peak use and off-peak use pricing 16.29 structures. The commissioner may not approve any new projects 16.30 after July 1, 1997. 16.31 (b) To obtain ITV revenue, a district may levy an amount 16.32 not to exceed the district's ITV revenue times the lesser of one 16.33 or the ratio of: 16.34 (1) the quotient derived by dividing the adjusted net tax 16.35 capacity of the district for the year before the year the levy 16.36 is certified by the actual pupil units in the district for the 17.1 year to which the levy is attributable; to 17.2 (2) 100 percent of the equalizing factor as defined in 17.3 section 124A.02, subdivision 8, for the year to which the levy 17.4 is attributable. 17.5 (c) A district's ITV aid is the difference between its ITV 17.6 revenue and the ITV levy. 17.7 (d) The revenue in the first year after reorganization for 17.8 a district that has reorganized under section 122.22, 122.23, or 17.9 122.241 to 122.247 shall be the greater of: 17.10 (1) the revenue computed for the reorganized district under 17.11 paragraph (a), or 17.12 (2)(i) for two districts that reorganized, 75 percent of 17.13 the revenue computed as if the districts involved in the 17.14 reorganization were separate, or 17.15 (ii) for three or more districts that reorganized, 50 17.16 percent of the revenue computed as if the districts involved in 17.17 the reorganization were separate. 17.18 (e) The revenue in paragraph (d) is increased by the 17.19 difference between the initial revenue and ITV lease costs for 17.20 leases that had been entered into by the preexisting districts 17.21 on the effective date of the consolidation or combination and 17.22 with a term not exceeding ten years. This increased revenue is 17.23 only available for the remaining term of the lease. However, in 17.24 no case shall the revenue exceed the amount available had the 17.25 preexisting districts received revenue separately. 17.26 Sec. 31. Minnesota Statutes 1996, section 124.91, 17.27 subdivision 7, is amended to read: 17.28 Subd. 7. [LEASE PURCHASE, INSTALLMENT BUYS.] (a) Upon 17.29 application to, and approval by, the commissioner in accordance 17.30 with the procedures and limits in subdivision 1, a district, as 17.31 defined in this subdivision, may: 17.32 (1) purchase real or personal property under an installment 17.33 contract or may lease real or personal property with an option 17.34 to purchase under a lease purchase agreement, by which 17.35 installment contract or lease purchase agreement title is kept 17.36 by the seller or vendor or assigned to a third party as security 18.1 for the purchase price, including interest, if any; and 18.2 (2)annually levyreceive state aid in the amounts 18.3 necessary to pay the district's obligations under the 18.4 installment contract or lease purchase agreement. 18.5 (b) The obligation created by the installment contract or 18.6 the lease purchase agreement must not be included in the 18.7 calculation of net debt for purposes of section 475.53, and does 18.8 not constitute debt under other law. An election is not 18.9 required in connection with the execution of the installment 18.10 contract or the lease purchase agreement. 18.11 (c) Theproceeds of the levy authorized bycommissioner 18.12 shall not authorize state aid under this subdivisionmust notto 18.13 be used to acquire a facility to be primarily used for athletic 18.14 or school administration purposes. 18.15 (d) For the purposes of this subdivision, "district" means: 18.16 (1) a school district required to have a comprehensive plan 18.17 for the elimination of segregation whose plan has been 18.18 determined by the commissioner to be in compliance with the 18.19 state board of education rules relating to equality of 18.20 educational opportunity and school desegregation; or 18.21 (2) a school district that participates in a joint program 18.22 for interdistrict desegregation with a district defined in 18.23 clause (1) if the facility acquired under this subdivision is to 18.24 be primarily used for the joint program. 18.25 (e)Notwithstanding subdivision 1, the prohibition against18.26a levy by a district to lease or rent a district-owned building18.27to itself does not apply to levies otherwise authorized by this18.28subdivision.18.29(f)For the purposes of this subdivision, any references in 18.30 subdivision 1 to building or land shall include personal 18.31 property. 18.32 Sec. 32. Minnesota Statutes 1996, section 124.912, 18.33 subdivision 1, is amended to read: 18.34 Subdivision 1. [STATUTORY OBLIGATIONS.](a)A school 18.35 district may levythe amount authorized for liabilities of18.36dissolved districts pursuant to section 122.45; the amounts19.1necessary to pay the district's obligations under section19.2268.06, subdivision 25; the amounts necessary to pay for job19.3placement services offered to employees who may become eligible19.4for benefits pursuant to section 268.08;the amounts necessary 19.5 to pay the district's obligations under section 127.05; the19.6amounts authorized by section 122.531; the amounts necessary to19.7pay the district's obligations under section 122.533; and for19.8severance pay required by sections 120.08, subdivision 3, and19.9122.535, subdivision 6. 19.10(b) Each year, a member district of an education district19.11that levies under this subdivision must transfer the amount of19.12revenue certified under paragraph (b) to the education district19.13board according to this subdivision. By June 20 and November 3019.14of each year, an amount must be transferred equal to:19.15(1) 50 percent times19.16(2) the amount certified in paragraph (b) minus homestead19.17and agricultural credit aid allocated for that levy according to19.18section 273.1398, subdivision 6.A school district is eligible 19.19 for state aid for the following purposes: 19.20 (1) liabilities for dissolved districts under section 19.21 122.45; 19.22 (2) the amounts necessary to pay the district's obligations 19.23 under section 268.06, subdivision 25; 19.24 (3) the amounts necessary to pay for job placement services 19.25 offered to employees who may become eligible for benefits 19.26 pursuant to section 268.08; 19.27 (4) the amounts authorized by section 122.531; 19.28 (5) the amounts necessary to pay the district's obligations 19.29 under section 122.533; and 19.30 (6) for severance pay required by sections 120.08, 19.31 subdivision 3, and 122.535, subdivision 6. 19.32 The commissioner shall consider all requests for state aid 19.33 under this subdivision and shall, at the commissioner's 19.34 discretion, approve, modify, or disapprove aid amounts. 19.35 Sec. 33. Minnesota Statutes 1996, section 124.912, 19.36 subdivision 3, is amended to read: 20.1 Subd. 3. [RULE COMPLIANCE.] Each year a district that is 20.2 required to implement a plan according to the requirements of 20.3 Minnesota Rules, parts 3535.0200 to 3535.2200,may levyis 20.4 eligible for state aid in an amountnot to exceed a net tax rate20.5ofequal to 2.0 percent times the adjusted net tax capacity of 20.6 the district fortaxes payable in 1991 and thereafterthe 20.7 preceding year. A district thatleviesreceives integration 20.8 revenue according tosubdivision 2 may not levy according20.9tosection 124.312 is not eligible for state aid under this 20.10 subdivision.Notwithstanding section 121.904, the entire amount20.11of this levy shall be recognized as revenue for the fiscal year20.12in which the levy is certified. This levy shall not be20.13considered in computing the aid reduction under section 124.155.20.14 Sec. 34. Minnesota Statutes 1996, section 124.912, 20.15 subdivision 6, is amended to read: 20.16 Subd. 6. [CRIME RELATED COSTS.]For taxes levied in 199120.17and subsequent years, payable in 1992 and subsequent years, each20.18school district may make a levy on all taxable property located20.19within the school district for the purposes specified in this20.20subdivision. The maximum amount which may be levied for all20.21costs under this subdivision shall be equal toState aid for 20.22 crime related costs equals $1 multiplied by the population of 20.23 the school district. For purposes of this subdivision, 20.24 "population" of the school district means the same as contained 20.25 in section 275.14. Theproceeds of the levystate aid must be 20.26 used for reimbursing the cities and counties who contract with 20.27 the school district for the following purposes: (1) to pay the 20.28 costs incurred for the salaries, benefits, and transportation 20.29 costs of peace officers and sheriffs for liaison services in the 20.30 district's middle and secondary schools; (2) to pay the costs 20.31 for a drug abuse prevention program as defined in Minnesota 20.32 Statutes 1991 Supplement, section 609.101, subdivision 3, 20.33 paragraph (f), in the elementary schools; or (3) to pay the 20.34 costs for a gang resistance education training curriculum in the 20.35 middle schools. The school district must initially attempt to 20.36 contract for these services with the police department of each 21.1 city or the sheriff's department of the county within the school 21.2 district containing the school receiving the services. If a 21.3 local police department or a county sheriff's department does 21.4 not wish to provide the necessary services, the district may 21.5 contract for these services with any other police or sheriff's 21.6 department located entirely or partially within the school 21.7 district's boundaries.The levy authorized under this21.8subdivision is not included in determining the school district's21.9levy limitations.21.10 Sec. 35. Minnesota Statutes 1996, section 124.912, 21.11 subdivision 7, is amended to read: 21.12 Subd. 7. [ICE ARENALEVYAID.] (a) Each year, an 21.13 independent school district operating and maintaining an ice 21.14 arena,may levyis eligible for state aid for the net 21.15 operational costs of the ice arena. Thelevyamount of state 21.16 aid may not exceed the net actual costs of operation of the 21.17 arena for the previous year. Net actual costs are defined as 21.18 operating costs less any operating revenues. 21.19 (b) Any school district operating and maintaining an ice 21.20 arena must demonstrate to the satisfaction of the office of 21.21 monitoring in the department of children, families, and learning 21.22 that the district will offer equal sports opportunities for male 21.23 and female students to use its ice arena, particularly in areas 21.24 of access to prime practice time, team support, and providing 21.25 junior varsity and younger level teams for girls' ice sports and 21.26 ice sports offerings. The commissioner shall consider all 21.27 requests for state aid under this subdivision and shall, at the 21.28 commissioner's discretion, approve, modify, or disapprove aid 21.29 amounts. 21.30 Sec. 36. Minnesota Statutes 1996, section 124.914, 21.31 subdivision 1, is amended to read: 21.32 Subdivision 1. [1977 STATUTORY OPERATING DEBT.] (1) In 21.33 each year in which so required by this subdivision, a district 21.34shall make an additional levyis eligible for state aid to 21.35 eliminate its statutory operating debt, determined as of June 21.36 30, 1977, and certified and adjusted by the commissioner.This22.1 State aid payments for fiscal years 1999 and later and the 22.2 previous local levy shall not be made in more than 30 successive 22.3 years and each year before it is made, it must be approved by 22.4 the commissioner and the approval shall specify its 22.5 amount.This levy shall be an amount which is equal to the22.6amount raised by a levy of a net tax rate of 1.66 percent times22.7the adjusted net tax capacity of the district for the preceding22.8year for taxes payable in 1991 and thereafter; provided that in22.9the last year in which the district is required to make this22.10levy, it shall levy an amount not to exceed the amount raised by22.11a levy of a net tax rate of 1.66 percent times the adjusted net22.12tax capacity of the district for the preceding year for taxes22.13payable in 1991 and thereafterThe state aid for each district 22.14 equals the amount raised by the levy for this purpose for taxes 22.15 payable in 1997. When the sum of the cumulativelevies made22.16pursuantrevenue received according to this subdivision and 22.17 transfers made according to section 121.912, subdivision 4, 22.18 equals an amount equal to the statutory operating debt of the 22.19 district, thelevystate aid shall be discontinued. 22.20 (2) The district shall establish a special account in the 22.21 general fund which shall be designated "appropriated fund 22.22 balance reserve account for purposes of reducing statutory 22.23 operating debt" on its books and records. This account shall 22.24 reflect thelevyrevenue authorized pursuant to this subdivision. 22.25 The proceeds of thislevyrevenue shall be used only for cash 22.26 flow requirements and shall not be used to supplement district 22.27 revenues or income for the purposes of increasing the district's 22.28 expenditures or budgets. 22.29 (3)Any district which is required to levy pursuant to this22.30subdivision shall certify the maximum levy allowable under22.31section 124A.23, subdivision 2, in that same year.22.32(4)Each district shall make permanent fund balance 22.33 transfers so that the total statutory operating debt of the 22.34 district is reflected in the general fund as of June 30, 1977. 22.35 Sec. 37. Minnesota Statutes 1996, section 124.914, 22.36 subdivision 2, is amended to read: 23.1 Subd. 2. [1983 OPERATING DEBT.] (1) Each year, a 23.2 districtmay make an additional levyis eligible for state aid 23.3 to eliminate a deficit in the net unappropriated operating funds 23.4 of the district, determined as of June 30, 1983, and certified 23.5 and adjusted by the commissioner. Thislevy may in each year be23.6an amount not to exceed the amount raised by a levy of a net tax23.7rate of 1.85 percent times the adjusted net tax capacity for23.8taxes payable in 1991 and thereafter of the district for the23.9preceding year as determined by the commissionerstate aid for 23.10 each district equals the amount raised by the district's levy 23.11 for this purpose for taxes payable in 1997. However, the total 23.12 amount of thislevyrevenue for all years it ismadereceived 23.13 shall not exceed the lesser of (a) the amount of the deficit in 23.14 the net unappropriated operating funds of the district as of 23.15 June 30, 1983, or (b) the amount of the aid reduction, according 23.16 to Laws 1981, Third Special Session chapter 2, article 2, 23.17 section 2, but excluding clauses (l), (m), (n), (o), and (p), 23.18 and Laws 1982, Third Special Session chapter 1, article 3, 23.19 section 6, to the district in fiscal year 1983. When the 23.20 cumulativelevies made pursuantrevenue received according to 23.21 this subdivisionequalequals the total amount permitted by this 23.22 subdivision, thelevystate aid shall be discontinued. 23.23 (2) The proceeds of thislevystate aid shall be used only 23.24 for cash flow requirements and shall not be used to supplement 23.25 district revenues or income for the purposes of increasing the 23.26 district's expenditures or budgets. 23.27(3) Any district that levies pursuant to this subdivision23.28shall certify the maximum levy allowable under section 124A.23,23.29subdivisions 2 and 2a, in that same year.23.30 Sec. 38. Minnesota Statutes 1996, section 124.914, 23.31 subdivision 3, is amended to read: 23.32 Subd. 3. [1985 OPERATING DEBT.] (1) Each year, a 23.33 districtmay levyis eligible for state aid to eliminate a 23.34 deficit in the net unappropriated balance in the general fund of 23.35 the district, determined as of June 30, 1985, and certified and 23.36 adjusted by the commissioner. Each yearthis levy may be an24.1amount not to exceed the amount raised by a levy of a net tax24.2rate of 1.85 percent times the adjusted net tax capacity for24.3taxes payable in 1991 and thereafter of the district for the24.4preceding yearthe state aid for each district equals the amount 24.5 raised by the district's levy for this purpose for taxes payable 24.6 in 1997. However, the total amount of thislevyrevenue for all 24.7 years it ismadereceived shall not exceed the amount of the 24.8 deficit in the net unappropriated balance in the general fund of 24.9 the district as of June 30, 1985. When the cumulativelevies24.10made pursuant torevenue received under this subdivisionequal24.11 equals the total amount permitted by this subdivision, thelevy24.12 state aid shall be discontinued. 24.13 (2) A district, if eligible, maylevyreceive revenue under 24.14 this subdivision or subdivision 2 but not both. 24.15 (3) The proceeds of thislevyrevenue shall be used only 24.16 for cash flow requirements and shall not be used to supplement 24.17 district revenues or income for the purposes of increasing the 24.18 district's expenditures or budgets. 24.19(4) Any district that levies pursuant to this subdivision24.20shall certify the maximum levy allowable under section 124A.23,24.21subdivision 2, in that same year.24.22 Sec. 39. Minnesota Statutes 1996, section 124.914, 24.23 subdivision 4, is amended to read: 24.24 Subd. 4. [1992 OPERATING DEBT.] (a) Fortaxes payable for24.25calendar year 2003fiscal year 2004 and earlier, a district that 24.26 has filed a plan pursuant to section 121.917, subdivision 4,may24.27levyis eligible for state aid, with the approval of the 24.28 commissioner, to eliminate a deficit in the net unappropriated 24.29 balance in the operating funds of the district, determined as of 24.30 June 30, 1992, and certified and adjusted by the commissioner. 24.31 Each year thislevy may be an amount not tostate aid shall not 24.32 exceed the lesser of: 24.33 (1) an amount raised bya levy of a net tax rate of one24.34percent times the adjusted net tax capacitythe district's levy 24.35 for this purpose for taxes payable in 1997; or 24.36 (2) $100,000. 25.1 This amount shall be reduced by referendum revenue authorized 25.2 under section 124A.03 pursuant to the plan filed under section 25.3 121.917. However, the total amount of thislevyrevenue for all 25.4 years it ismadereceived shall not exceed the amount of the 25.5 deficit in the net unappropriated balance in the operating funds 25.6 of the district as of June 30, 1992. When the cumulativelevies25.7made pursuant torevenue received under this subdivisionequal25.8 equals the total amount permitted by this subdivision, thelevy25.9 state aid shall be discontinued. 25.10 (b) A district, if eligible, maylevyreceive revenue under 25.11 this subdivision or subdivision 2 or 3, or under section 25.12 122.531, subdivision 4a, or Laws 1992, chapter 499, article 7, 25.13 sections 16 or 17, but not under more than one. 25.14 (c) The proceeds of thislevyrevenue shall be used only 25.15 for cash flow requirements and shall not be used to supplement 25.16 district revenues or income for the purposes of increasing the 25.17 district's expenditures or budgets. 25.18(d) Any district that levies pursuant to this subdivision25.19shall certify the maximum levy allowable under section 124A.23,25.20subdivision 2, in that same year.25.21 Sec. 40. Minnesota Statutes 1996, section 124.916, 25.22 subdivision 1, is amended to read: 25.23 Subdivision 1. [HEALTH INSURANCE.] (a) A school 25.24 districtmay levyis eligible for state aid in the amount 25.25 necessary to make employer contributions for insurance for 25.26 retired employees under this subdivision.Notwithstanding25.27section 121.904, 50 percent of the amount levied shall be25.28recognized as revenue for the fiscal year in which the levy is25.29certified. This levy shall not be considered in computing the25.30aid reduction under section 124.155.25.31 (b) The school board of a joint vocational technical 25.32 district formed under sections 136C.60 to 136C.69 and the school 25.33 board of a school district may provide employer-paid hospital, 25.34 medical, and dental benefits to a person who: 25.35 (1) is eligible for employer-paid insurance under 25.36 collective bargaining agreements or personnel plans in effect on 26.1 June 30, 1992; 26.2 (2) has at least 25 years of service credit in the public 26.3 pension plan of which the person is a member on the day before 26.4 retirement or, in the case of a teacher, has a total of at least 26.5 25 years of service credit in the teachers retirement 26.6 association, a first-class city teacher retirement fund, or any 26.7 combination of these; 26.8 (3) upon retirement is immediately eligible for a 26.9 retirement annuity; 26.10 (4) is at least 55 and not yet 65 years of age; and 26.11 (5) retires on or after May 15, 1992, and before July 21, 26.12 1992. 26.13 A school board paying insurance under this subdivision may 26.14 not exclude any eligible employees. 26.15 (c) An employee who is eligible both for the health 26.16 insurance benefit under this subdivision and for an early 26.17 retirement incentive under a collective bargaining agreement or 26.18 personnel plan established by the employer must select either 26.19 the early retirement incentive provided under the collective 26.20 bargaining agreement personnel plan or the incentive provided 26.21 under this subdivision, but may not receive both. For purposes 26.22 of this subdivision, a person retires when the person terminates 26.23 active employment and applies for retirement benefits. The 26.24 retired employee is eligible for single and dependent coverages 26.25 and employer payments to which the person was entitled 26.26 immediately before retirement, subject to any changes in 26.27 coverage and employer and employee payments through collective 26.28 bargaining or personnel plans, for employees in positions 26.29 equivalent to the position from which the employee retired. The 26.30 retired employee is not eligible for employer-paid life 26.31 insurance. Eligibility ceases when the retired employee attains 26.32 the age of 65, or when the employee chooses not to receive the 26.33 retirement benefits for which the employee has applied, or when 26.34 the employee is eligible for employer-paid health insurance from 26.35 a new employer. Coverages must be coordinated with relevant 26.36 health insurance benefits provided through the federally 27.1 sponsored Medicare program. 27.2 (d) Unilateral implementation of this section by a public 27.3 employer is not an unfair labor practice for purposes of chapter 27.4 179A. The authority provided in this subdivision for an 27.5 employer to pay health insurance costs for certain retired 27.6 employees is not subject to the limits in section 179A.20, 27.7 subdivision 2a. 27.8 (e) If a school districtleviesreceives revenue according 27.9 to this subdivision, it may not alsolevyreceive revenue 27.10 according to section 122.531, subdivision 9, for eligible 27.11 employees. 27.12 Sec. 41. Minnesota Statutes 1996, section 124.916, 27.13 subdivision 2, is amended to read: 27.14 Subd. 2. [RETIRED EMPLOYEE HEALTH BENEFITS.] Fortaxes27.15payable in 1996, 1997, 1998, and 1999fiscal year 2000 only, a 27.16 school districtmay levyis eligible for state aid in an amount 27.17 up to the amount the district is required by the collective 27.18 bargaining agreement in effect on March 30, 1992, to pay for 27.19 health insurance or unreimbursed medical expenses for licensed 27.20 and nonlicensed employees who have terminated services in the 27.21 employing district and withdrawn from active teaching service or 27.22 other active service, as applicable, before July 1, 1992. The 27.23 total amount of thelevystate aid for a district each year may 27.24 not exceed $300,000. 27.25Notwithstanding section 121.904, 50 percent of the proceeds27.26of this levy shall be recognized in the fiscal year in which it27.27is certified.27.28 Sec. 42. Minnesota Statutes 1996, section 124.916, 27.29 subdivision 3, is amended to read: 27.30 Subd. 3. [RETIREMENTLEVIESAID.](1) In addition to the27.31excess levy authorized in 1976 any district within a city of the27.32first class which was authorized in 1975 to make a retirement27.33levy under Minnesota Statutes 1974, section 275.127 and chapter27.34422A may levy an amount per pupil unit which is equal to the27.35amount levied in 1975 payable 1976, under Minnesota Statutes27.361974, section 275.127 and chapter 422A, divided by the number of28.1pupil units in the district in 1976-1977.28.2(2) In 1979 and each year thereafter, any district which28.3qualified in 1976 for an extra levy under paragraph (1) shall be28.4allowed to levy the same amount as levied for retirement in 197828.5under this clause reduced each year by ten percent of the28.6difference between the amount levied for retirement in 197128.7under Minnesota Statutes 1971, sections 275.127 and 422.01 to28.8422.54 and the amount levied for retirement in 1975 under28.9Minnesota Statutes 1974, section 275.127 and chapter 422A.28.10(3) In 1991 and each year thereafter, a district to which28.11this subdivision applies may levy an additional amount required28.12for contributions to the Minneapolis employees retirement fund28.13as a result of the maximum dollar amount limitation on state28.14contributions to the fund imposed under section 422A.101,28.15subdivision 3. The additional levy shall not exceed the most28.16recent amount certified by the board of the Minneapolis28.17employees retirement fund as the district's share of the28.18contribution requirement in excess of the maximum state28.19contribution under section 422A.101, subdivision 3.28.20(4) For taxes payable in 1994 and thereafter, special28.21school district No. 1, Minneapolis, and independent school28.22district No. 625, St. Paul, may levy for the increase in the28.23employer retirement fund contributions, under Laws 1992, chapter28.24598, article 5, section 1. Notwithstanding section 121.904, the28.25entire amount of this levy may be recognized as revenue for the28.26fiscal year in which the levy is certified. This levy shall not28.27be considered in computing the aid reduction under section28.28124.155.28.29 (1) For fiscal years 1999 and later, a district is eligible 28.30 for state aid equal to the amount of its retirement levies 28.31 certified under this subdivision for taxes payable in 1997. 28.32(5)(2) If the employer retirement fund contributions under 28.33 section 354A.12, subdivision 2a, are increased for fiscal year 28.34 1994 or later fiscal years, special school district No. 1, 28.35 Minneapolis, and independent school district No. 625, St. Paul, 28.36may levy in payable 1994 or later an amountare eligible for 29.1 state aid equal to the amount derived by applying the net 29.2 increase in the employer retirement fund contribution rate of 29.3 the respective teacher retirement fund association between 29.4 fiscal year 1993 and the fiscal year beginning in the year after 29.5 the levy is certified to the total covered payroll of the 29.6 applicable teacher retirement fund association.Notwithstanding29.7section 121.904, the entire amount of this levy may be29.8recognized as revenue for the fiscal year in which the levy is29.9certified. This levy shall not be considered in computing the29.10aid reduction under section 124.155. If an applicable school29.11district levies under this paragraph, they may not levy under29.12paragraph (4).29.13(6)(3) In addition to thelevystate aid authorized under 29.14 paragraph(5)(2), special school district No. 1, 29.15 Minneapolis,may also levy payable in 1997 or lateris also 29.16 eligible for additional state aid in an amount equal to the 29.17 contributions undersectionsections 423A.02, subdivision 3, and 29.18may also levy in payable 1994 or later an amount equal to the29.19state aid contribution under section354A.12, subdivision 3b. 29.20 Independent school district No. 625, St. Paul,may levy payable29.21in 1997 oris eligible for additional state aid in fiscal years 29.22 1999 and later in an amount equal to the supplemental 29.23 contributions under section 423A.02, subdivision 29.24 3.Notwithstanding section 121.904, the entire amount of these29.25levies may be recognized as revenue for the fiscal year in which29.26the levy is certified. These levies shall not be considered in29.27computing the aid reduction under section 124.155.29.28 Sec. 43. Minnesota Statutes 1996, section 124.916, 29.29 subdivision 4, is amended to read: 29.30 Subd. 4. [MINNEAPOLIS HEALTH INSURANCE SUBSIDY.] Each year 29.31 special school district No. 1, Minneapolis,may make an29.32additional levy not to exceedis eligible for state aid equal to 29.33 the amount raised by a net tax rate of .10 percent times the 29.34 adjusted net tax capacityfor taxes payable in 1991 and29.35thereafterof the property in the district forthe preceding29.36 assessment year 1996. The proceeds may be used only to 30.1 subsidize health insurance costs for eligible teachers as 30.2 provided in this section. 30.3 "Eligible teacher" means a retired teacher who was a basic 30.4 member of the Minneapolis teachers retirement fund association, 30.5 who retired before May 1, 1974, or who had 20 or more years of 30.6 basic member service in the Minneapolis teacher retirement fund 30.7 association and retired before June 30, 1983, and who is not 30.8 eligible to receive the hospital insurance benefits of the 30.9 federal Medicare program of the Social Security Act without 30.10 payment of a monthly premium. The district shall notify 30.11 eligible teachers that a subsidy is available. To obtain a 30.12 subsidy, an eligible teacher must submit to the school district 30.13 a copy of receipts for health insurance premiums paid. The 30.14 school district shall disburse the health insurance premium 30.15 subsidy to each eligible teacher according to a schedule 30.16 determined by the district, but at least annually. An eligible 30.17 teacher may receive a subsidy up to an amount equal to the 30.18 lesser of 90 percent of the cost of the eligible teacher's 30.19 health insurance or up to 90 percent of the cost of the number 30.20 two qualified plan of health coverage for individual policies 30.21 made available by the Minnesota comprehensive health association 30.22 under chapter 62E. 30.23 If funds remaining from the previous year's health 30.24 insurance subsidylevyrevenue, minus the previous year's 30.25 required subsidy amount, are sufficient to pay the estimated 30.26 current year subsidy, thelevystate aid must be discontinued 30.27 until the remaining funds are estimated by the school board to 30.28 be insufficient to pay the subsidy. 30.29 This subdivision does not extend benefits to teachers who 30.30 retire after June 30, 1983, and does not create a contractual 30.31 right or claim for altering the benefits in this subdivision. 30.32 This subdivision does not restrict the school district's right 30.33 to modify or terminate coverage under this subdivision. 30.34 Sec. 44. Minnesota Statutes 1996, section 124.918, 30.35 subdivision 8, is amended to read: 30.36 Subd. 8. [TACONITE PAYMENT AND OTHER REDUCTIONS.] (1) 31.1 Reductions in levies pursuant to section 124.918, subdivision 1, 31.2 and section 273.138, shall be made prior to the reductions in 31.3 clause (2). 31.4 (2) Notwithstanding any other law to the contrary, 31.5 districts which received payments pursuant to sections 298.018; 31.6 298.23 to 298.28, except an amount distributed under section 31.7 298.28, subdivision 4, paragraph (c), clause (ii); 298.34 to 31.8 298.39; 298.391 to 298.396; 298.405; and any law imposing a tax 31.9 upon severed mineral values, or recognized revenue pursuant to 31.10 section 477A.15; shall not include a portion of these aids in 31.11 their permissible levies pursuant to those sections, but instead 31.12 shall reduce the permissible levies authorized by this chapter 31.13 and chapter 124A by the greater of the following: 31.14 (a) an amount equal to 50 percent of the total dollar 31.15 amount of the payments received pursuant to those sections or 31.16 revenue recognized pursuant to section 477A.15 in the previous 31.17 fiscal year; or 31.18 (b) an amount equal to the total dollar amount of the 31.19 payments received pursuant to those sections or revenue 31.20 recognized pursuant to section 477A.15 in the previous fiscal 31.21 year less the product of the same dollar amount of payments or 31.22 revenue times the ratio of the maximum levy allowed the district 31.23 under Minnesota Statutes 1986, sections 124A.03, subdivision 2, 31.24 124A.06, subdivision 3a, 124A.08, subdivision 3a, 124A.10, 31.25 subdivision 3a, 124A.12, subdivision 3a, and 124A.14, 31.26 subdivision 5a, to the total levy allowed the district under 31.27 this section and Minnesota Statutes 1986, sections 124A.03, 31.28 124A.06, subdivision 3a, 124A.08, subdivision 3a, 124A.10, 31.29 subdivision 3a, 124A.12, subdivision 3a, 124A.14, subdivision 31.30 5a, and 124A.20, subdivision 2, for levies certified in 1986. 31.31 (3)No reduction pursuant to this subdivision shall reduce31.32the levy made by the district pursuant to section 124A.23, to an31.33amount less than the amount raised by a levy of a net tax rate31.34of 6.82 percent times the adjusted net tax capacity for taxes31.35payable in 1990 and thereafter of that district for the31.36preceding year as determined by the commissioner. The amount of32.1any increased levy authorized by referendum pursuant to section32.2124A.03, subdivision 2, shall not be reduced pursuant to this32.3subdivision.The amount of any levy authorized by 32.4 section124.912, subdivision 1,124.97 to make payments for 32.5 bonds issued and for interest thereon, shall not be reduced 32.6 pursuant to this subdivision. 32.7 (4) Before computing the reduction pursuant to this 32.8 subdivision of the capital expenditure facilities levy 32.9 authorized by section 124.243, the capital expenditure equipment 32.10 levy authorized by section 124.244, the health and safety levy 32.11 authorized by sections 124.83 and 124.91, subdivision 6, the 32.12 commissioner shall ascertain from each affected school district 32.13 the amount it proposes to levy under each section or 32.14 subdivision. The reduction shall be computed on the basis of 32.15 the amount so ascertained. 32.16 (5) Notwithstanding any law to the contrary, any amounts 32.17 received by districts in any fiscal year pursuant to sections 32.18 298.018; 298.23 to 298.28; 298.34 to 298.39; 298.391 to 298.396; 32.19 298.405; or any law imposing a tax on severed mineral values; 32.20 and not deducted from general education aid pursuant to section 32.21 124A.035, subdivision 5, clause (2), and not applied to reduce 32.22 levies pursuant to this subdivision shall be paid by the 32.23 district to the St. Louis county auditor in the following amount 32.24 by March 15 of each year, the amount required to be subtracted 32.25 from the previous fiscal year's general education aid pursuant 32.26 to section 124A.035, subdivision 5, which is in excess of the 32.27 general education aid earned for that fiscal year. The county 32.28 auditor shall deposit any amounts received pursuant to this 32.29 clause in the St. Louis county treasury for purposes of paying 32.30 the taconite homestead credit as provided in section 273.135. 32.31 Sec. 45. Minnesota Statutes 1996, section 124A.22, 32.32 subdivision 1, is amended to read: 32.33 Subdivision 1. [GENERAL EDUCATION REVENUE.](a) For fiscal32.34year 1996, the general education revenue for each district32.35equals the sum of the district's basic revenue, compensatory32.36education revenue, training and experience revenue, secondary33.1sparsity revenue, elementary sparsity revenue, and supplemental33.2revenue.33.3(b)For fiscal year 1997 and thereafter, the general 33.4 education revenue for each district equals the sum of the 33.5 district's basic revenue, compensatory education revenue, 33.6 secondary sparsity revenue, elementary sparsity revenue, 33.7 transportation sparsity, total operating capital revenue, 33.8 transition revenue, and supplemental revenue. For fiscal years 33.9 2000 and later, general education revenue is provided through 33.10 state aid. 33.11 Sec. 46. Minnesota Statutes 1996, section 124A.23, 33.12 subdivision 1, is amended to read: 33.13 Subdivision 1. [GENERAL EDUCATION STATEWIDE PROPERTY TAX 33.14RATE.] The commissioner of revenue shall establish the general 33.15 education statewide property tax rate by July 1 of each year for 33.16 levies payable in the following year. The general 33.17 education statewide property tax capacity rate shall be a rate,33.18rounded up to the nearest tenth of a percent,that, when applied 33.19 to the adjusted net tax capacity for alldistrictscounties, 33.20 raises the amount specified in this subdivision. The general 33.21 education statewide property tax rate shall be the rate that 33.22 raises$1,054,000,000 for fiscal year 1996 and33.23$1,359,000,000$1,363,000,000 for fiscal year19972000 and 33.24 later fiscal years.The general education tax rate may not be33.25changed due to changes or corrections made to a district's33.26adjusted net tax capacity after the tax rate has been33.27established.The commissioner of revenue shall calculate the 33.28 amount that shall be raised in each county and certify that 33.29 amount to the county auditor. The auditor shall extend the levy 33.30 against the net tax capacity in the county. 33.31 Sec. 47. Minnesota Statutes 1996, section 124A.292, 33.32 subdivision 2, is amended to read: 33.33 Subd. 2. [REVENUE.] Staff development incentive revenue is 33.34 equal to the number of teachers at the site times $25. Staff 33.35 development incentive revenue is provided through state aid. 33.36 Sec. 48. Minnesota Statutes 1996, section 275.08, 34.1 subdivision 1b, is amended to read: 34.2 Subd. 1b. [COMPUTATION OF TAX RATES.] The amounts 34.3 certified to be levied against net tax capacity under section 34.4 275.07 by an individual local government unit shall be divided 34.5 by the total net tax capacity of all taxable properties within 34.6 the local government unit's taxing jurisdiction. The resulting 34.7 ratio, the local government's local tax rate, multiplied by each 34.8 property's net tax capacity shall be each property's net tax 34.9 capacity tax for that local government unit before reduction by 34.10 any credits. 34.11 The general education statewide property tax levied within 34.12 each county under section 124A.23, subdivision 1, shall be 34.13 divided by the total net tax capacity of all taxable properties 34.14 within the county. The resulting ratio, the county's general 34.15 education statewide property tax rate, multiplied by each 34.16 property's net tax capacity, shall be each property's general 34.17 education statewide property tax before reduction by any credits. 34.18 Any amount certified to the county auditor to be levied 34.19 against market value shall be divided by the total referendum 34.20 market value of all taxable properties within the taxing 34.21 district. The resulting ratio, the taxing district's new 34.22 referendum tax rate, multiplied by each property's referendum 34.23 market value shall be each property's new referendum tax before 34.24 reduction by any credits. For the purposes of this subdivision, 34.25 "referendum market value" means the market value as defined in 34.26 section 124A.02, subdivision 3b. 34.27 Sec. 49. Minnesota Statutes 1996, section 298.28, is 34.28 amended by adding a subdivision to read: 34.29 Subd. 4a. [SCHOOL DISTRICT LEVY REDUCTION.] For taxes 34.30 payable in 1999 and later, a school district's levy reduction 34.31 under section 124.918, subdivision 8, is equal to the reduction 34.32 for taxes payable in 1998 times the ratio of the taxable tons in 34.33 the current year to the taxable tons in payable year 1998, but 34.34 not below zero. 34.35 Sec. 50. Minnesota Statutes 1996, section 298.28, is 34.36 amended by adding a subdivision to read: 35.1 Subd. 4b. [SCHOOL DISTRICT AID REDUCTION.] A school 35.2 district's taconite aid reduction to general education aid is 35.3 equal to one-third of its aid reduction for fiscal year 1999 35.4 times the ratio of the taxable tons in the current payable year 35.5 to the taxable tons in the payable year 1998. 35.6 Sec. 51. Minnesota Statutes 1996, section 469.177, 35.7 subdivision 1a, is amended to read: 35.8 Subd. 1a. [ORIGINAL LOCAL TAX RATE.] At the time of the 35.9 initial certification of the original net tax capacity for a tax 35.10 increment financing district or a subdistrict, the county 35.11 auditor shall certify the original local tax rate that applies 35.12 to the district or subdistrict. The original local tax rate is 35.13 the sum of all the local tax rates and the state tax rate that 35.14applyapplies to a property in the district or subdistrict. The 35.15 local tax rate to be certified is the rate in effect for the 35.16 same taxes payable year applicable to the tax capacity values 35.17 certified as the district's or subdistrict's original tax 35.18 capacity. The resulting tax capacity rate is the original local 35.19 tax rate for the life of the district or subdistrict. 35.20 Sec. 52. Minnesota Statutes 1996, section 469.177, 35.21 subdivision 3, is amended to read: 35.22 Subd. 3. [TAX INCREMENT, RELATIONSHIP TO CHAPTERS 276A AND 35.23 473F.] (a) Unless the governing body elects pursuant to clause 35.24 (b) the following method of computation shall apply: 35.25 (1) The original net tax capacity and the current net tax 35.26 capacity shall be determined before the application of the 35.27 fiscal disparity provisions of chapter 276A or 473F. Where the 35.28 original net tax capacity is equal to or greater than the 35.29 current net tax capacity, there is no captured net tax capacity 35.30 and no tax increment determination. Where the original net tax 35.31 capacity is less than the current net tax capacity, the 35.32 difference between the original net tax capacity and the current 35.33 net tax capacity is the captured net tax capacity. This amount 35.34 less any portion thereof which the authority has designated, in 35.35 its tax increment financing plan, to share with the local taxing 35.36 districts is the retained captured net tax capacity of the 36.1 authority. 36.2 (2) The county auditor shall exclude the retained captured 36.3 net tax capacity of the authority from the net tax capacity of 36.4 the state and local taxing districts in determining state and 36.5 local taxing district tax rates. The state and local tax rates 36.6 so determined are to be extended against the retained captured 36.7 net tax capacity of the authority as well as the net tax 36.8 capacity of the local taxing districts. The tax generated by 36.9 the extension of the lesser of (A) the sum of the state and 36.10 local taxing district tax rates or (B) the original local tax 36.11 rate to the retained captured net tax capacity of the authority 36.12 is the tax increment of the authority. 36.13 (b) The governing body may, by resolution approving the tax 36.14 increment financing plan pursuant to section 469.175, 36.15 subdivision 3, elect the following method of computation: 36.16 (1) The original net tax capacity shall be determined 36.17 before the application of the fiscal disparity provisions of 36.18 chapter 276A or 473F. The current net tax capacity shall 36.19 exclude any fiscal disparity commercial-industrial net tax 36.20 capacity increase between the original year and the current year 36.21 multiplied by the fiscal disparity ratio determined pursuant to 36.22 section 276A.06, subdivision 7, or 473F.08, subdivision 6. 36.23 Where the original net tax capacity is equal to or greater than 36.24 the current net tax capacity, there is no captured net tax 36.25 capacity and no tax increment determination. Where the original 36.26 net tax capacity is less than the current net tax capacity, the 36.27 difference between the original net tax capacity and the current 36.28 net tax capacity is the captured net tax capacity. This amount 36.29 less any portion thereof which the authority has designated, in 36.30 its tax increment financing plan, to share with the local taxing 36.31 districts is the retained captured net tax capacity of the 36.32 authority. 36.33 (2) The county auditor shall exclude the retained captured 36.34 net tax capacity of the authority from the net tax capacity of 36.35 the state and local taxing districts in determining state and 36.36 local taxing district tax rates. The state and local tax rates 37.1 so determined are to be extended against the retained captured 37.2 net tax capacity of the authority as well as the net tax 37.3 capacity of the local taxing districts. The tax generated by 37.4 the extension of the lesser of (A) the state and local taxing 37.5 district tax rates or (B) the original local tax rate to the 37.6 retained captured net tax capacity of the authority is the tax 37.7 increment of the authority. 37.8 (3) An election by the governing body pursuant to paragraph 37.9 (b) shall be submitted to the county auditor by the authority at 37.10 the time of the request for certification pursuant to 37.11 subdivision 1. 37.12 (c) The method of computation of tax increment applied to a 37.13 district pursuant to paragraph (a) or (b) shall remain the same 37.14 for the duration of the district, except that the governing body 37.15 may elect to change its election from the method of computation 37.16 in paragraph (a) to the method in paragraph (b). 37.17 Sec. 53. Minnesota Statutes 1996, section 473F.08, 37.18 subdivision 3, is amended to read: 37.19 Subd. 3. [APPORTIONMENT OF LEVY.] The county auditor shall 37.20 apportion the levy of each governmental unit in the auditor's 37.21 county in the manner prescribed by this subdivision. The 37.22 auditor shall: 37.23 (a) by August 20, determine the areawide portion of the 37.24 levy for each governmental unit by multiplying the local tax 37.25 rate of the governmental unit for the preceding levy year times 37.26 the distribution value set forth in subdivision 2, clause (b); 37.27 and 37.28 (b) by September 5, determine the local portion of the 37.29 current year's levy by subtracting the resulting amount from 37.30 clause (a) from the governmental unit's current year's levy. 37.31 For property taxes payable in 1999 only, a percentage of 37.32 the areawide portion of a school district's levy shall be 37.33 distributed to the state of Minnesota equal to the percentage 37.34 that the general education levy under section 124A.23 was the 37.35 school district's payable 1997 levy. The commissioner of 37.36 children, families, and learning shall certify the general 38.1 education levy percentage of each district's payable 1997 levy 38.2 to the administrative auditor by July 1, 1998, using the 38.3 definition of equalized levies found in section 273.1398, 38.4 subdivision 1. 38.5 Sec. 54. [REPEALER.] 38.6 Subdivision 1. [FISCAL YEAR 2000.] Minnesota Statutes 38.7 1996, sections 124.2134; 124.225, subdivisions 1, 3a, 7a, 7b, 38.8 7d, 7e, 7f, 8a, 8k, 8l, 8m, 9, 10, 13, 14, 15, 16, and 17; 38.9 124.226; 124.2442; 124.2601, subdivisions 4, 5, and 6; 124.2711, 38.10 subdivisions 2a and 3; 124.2713, subdivisions 6, 6a, 6b, and 7; 38.11 124.2715, subdivisions 2 and 3; 124.2716, subdivisions 3 and 4; 38.12 124.2725, subdivisions 3, 4, 5, and 7; 124.2727, subdivisions 38.13 6b, 6c, and 9; 124.314, subdivision 2; 124.321; 124.91, 38.14 subdivision 4; 124.912, subdivision 2; 124A.22, subdivisions 4a, 38.15 4b, 8a, 8b, 13d, and 13e; 124A.23, subdivisions 2, 3, and 4; 38.16 124A.26, subdivisions 2 and 3; 124A.292, subdivisions 3 and 4; 38.17 124A.697; 124A.698; 124A.70, subdivisions 1, 2, 3a, and 5; 38.18 124A.71; 124A.711; 124A.72; and 124A.73, are repealed for 38.19 revenue for fiscal year 2000. 38.20 Subd. 2. [JULY 1, 1997.] Laws 1992, chapter 499, article 38.21 7, section 31, is repealed. 38.22 Sec. 55. [EFFECTIVE DATE.] 38.23 Sections 1 to 47, 50, and 54, subdivision 1, are effective 38.24 beginning fiscal year 2000. Sections 48, 49, and 53 are 38.25 effective for property taxes payable in 1999 and thereafter. 38.26 Section 54, subdivision 2, is effective July 1, 1997. 38.27 ARTICLE 2 38.28 PROPERTY TAX CLASS RATES 38.29 Section 1. Minnesota Statutes 1996, section 273.13, 38.30 subdivision 24, is amended to read: 38.31 Subd. 24. [CLASS 3.] (a) Commercial and industrial 38.32 property and utility real and personal property, except class 5 38.33 property as identified in subdivision 31, clause (1), is class 38.34 3a. It has a class rate of three percent of the first $100,000 38.35 of market valuefor taxes payable in 1993 and thereafter, and 38.36 5.06 percent of the market value over $100,000 for taxes payable 39.1 in 1998 and 4.5 percent of the market value over $100,000 for 39.2 taxes payable in 1999 and thereafter. In the case of 39.3 state-assessed commercial, industrial, and utility property 39.4 owned by one person or entity, only one parcel has a reduced 39.5 class rate on the first $100,000 of market value. In the case 39.6 of other commercial, industrial, and utility property owned by 39.7 one person or entity, only one parcel in each county has a 39.8 reduced class rate on the first $100,000 of market value, except 39.9 that: 39.10 (1) if the market value of the parcel is less than 39.11 $100,000, and additional parcels are owned by the same person or 39.12 entity in the same city or town within that county, the reduced 39.13 class rate shall be applied up to a combined total market value 39.14 of $100,000 for all parcels owned by the same person or entity 39.15 in the same city or town within the county; 39.16 (2) in the case of grain, fertilizer, and feed elevator 39.17 facilities, as defined in section 18C.305, subdivision 1, or 39.18 232.21, subdivision 8, the limitation to one parcel per owner 39.19 per county for the reduced class rate shall not apply, but there 39.20 shall be a limit of $100,000 of preferential value per site of 39.21 contiguous parcels owned by the same person or entity. Only the 39.22 value of the elevator portion of each parcel shall qualify for 39.23 treatment under this clause. For purposes of this subdivision, 39.24 contiguous parcels include parcels separated only by a railroad 39.25 or public road right-of-way; and 39.26 (3) in the case of property owned by a nonprofit charitable 39.27 organization that qualifies for tax exemption under section 39.28 501(c)(3) of the Internal Revenue Code of 1986, as amended 39.29 through December 31, 1993, if the property is used as a business 39.30 incubator, the limitation to one parcel per owner per county for 39.31 the reduced class rate shall not apply, provided that the 39.32 reduced rate applies only to the first $100,000 of value per 39.33 parcel owned by the organization. As used in this clause, a 39.34 "business incubator" is a facility used for the development of 39.35 nonretail businesses, offering access to equipment, space, 39.36 services, and advice to the tenant businesses, for the purpose 40.1 of encouraging economic development, diversification, and job 40.2 creation in the area served by the organization. 40.3 To receive the reduced class rate on additional parcels 40.4 under clause (1), (2), or (3), the taxpayer must notify the 40.5 county assessor that the taxpayer owns more than one parcel that 40.6 qualifies under clause (1), (2), or (3). 40.7 (b) Employment property defined in section 469.166, during 40.8 the period provided in section 469.170, shall constitute class 40.9 3b and has a class rate of 2.3 percent of the first $50,000 of 40.10 market value and 3.6 percent of the remainder, except that for 40.11 employment property located in a border city enterprise zone 40.12 designated pursuant to section 469.168, subdivision 4, paragraph 40.13 (c), the class rate of the first $100,000 of market value and 40.14 the class rate of the remainder is determined under paragraph 40.15 (a), unless the governing body of the city designated as an 40.16 enterprise zone determines that a specific parcel shall be 40.17 assessed pursuant to the first clause of this sentence. The 40.18 governing body may provide for assessment under the first clause 40.19 of the preceding sentence only for property which is located in 40.20 an area which has been designated by the governing body for the 40.21 receipt of tax reductions authorized by section 469.171, 40.22 subdivision 1. 40.23 (c) Structures which are (i) located on property classified 40.24 as class 3a, (ii) constructed under an initial building permit 40.25 issued after January 2, 1996, (iii) located in a transit zone as 40.26 defined under section 473.3915, subdivision 3, (iv) located 40.27 within the boundaries of a school district, and (v) not 40.28 primarily used for retail or transient lodging purposes, shall 40.29 have a class rate of four percent on that portion of the market 40.30 value in excess of $100,000 and any market value under $100,000 40.31 that does not qualify for the three percent class rate under 40.32 paragraph (a). As used in item (v), a structure is primarily 40.33 used for retail or transient lodging purposes if over 50 percent 40.34 of its square footage is used for those purposes. The four 40.35 percent rate shall also apply to improvements to existing 40.36 structures that meet the requirements of items (i) to (v) if the 41.1 improvements are constructed under an initial building permit 41.2 issued after January 2, 1996, even if the remainder of the 41.3 structure was constructed prior to January 2, 1996. For the 41.4 purposes of this paragraph, a structure shall be considered to 41.5 be located in a transit zone if any portion of the structure 41.6 lies within the zone. If any property once eligible for 41.7 treatment under this paragraph ceases to remain eligible due to 41.8 revisions in transit zone boundaries, the property shall 41.9 continue to receive treatment under this paragraph for a period 41.10 of three years. 41.11 Sec. 2. Minnesota Statutes 1996, section 273.13, 41.12 subdivision 25, is amended to read: 41.13 Subd. 25. [CLASS 4.] (a) Class 4a is residential real 41.14 estate containing four or more units and used or held for use by 41.15 the owner or by the tenants or lessees of the owner as a 41.16 residence for rental periods of 30 days or more. Class 4a also 41.17 includes hospitals licensed under sections 144.50 to 144.56, 41.18 other than hospitals exempt under section 272.02, and contiguous 41.19 property used for hospital purposes, without regard to whether 41.20 the property has been platted or subdivided. Class 4a property 41.21 in a city with a population of 5,000 or less, that is (1) 41.22 located outside of the metropolitan area, as defined in section 41.23 473.121, subdivision 2, or outside any county contiguous to the 41.24 metropolitan area, and (2) whose city boundary is at least 15 41.25 miles from the boundary of any city with a population greater 41.26 than 5,000 has a class rate of 2.3 percent of market value for 41.27 taxes payable in 1996 and thereafter. All other Class 4a 41.28 property has a class rate of 3.4 percent of market value for 41.29 taxes payable in19961998 and 2.5 percent of market value for 41.30 taxes payable in 1999 and thereafter. For purposes of this 41.31 paragraph, population has the same meaning given in section 41.32 477A.011, subdivision 3. 41.33 (b) Class 4b includes: 41.34 (1) residential real estate containing less than four 41.35 units, other than seasonal residential, and recreational; 41.36 (2) manufactured homes not classified under any other 42.1 provision; 42.2 (3) a dwelling, garage, and surrounding one acre of 42.3 property on a nonhomestead farm classified under subdivision 23, 42.4 paragraph (b). 42.5 Class 4b property has a class rate of2.8 percent of market42.6value for taxes payable in 1992, 2.5 percent of market value for42.7taxes payable in 1993, and2.3 percent of market value for taxes 42.8 payable in19941998 and two percent of market value for taxes 42.9 payable in 1999 and thereafter. 42.10 (c) Class 4c property includes: 42.11 (1) a structure that is: 42.12 (i) situated on real property that is used for housing for 42.13 the elderly or for low- and moderate-income families as defined 42.14 in Title II, as amended through December 31, 1990, of the 42.15 National Housing Act or the Minnesota housing finance agency law 42.16 of 1971, as amended, or rules promulgated by the agency and 42.17 financed by a direct federal loan or federally insured loan made 42.18 pursuant to Title II of the Act; or 42.19 (ii) situated on real property that is used for housing the 42.20 elderly or for low- and moderate-income families as defined by 42.21 the Minnesota housing finance agency law of 1971, as amended, or 42.22 rules adopted by the agency pursuant thereto and financed by a 42.23 loan made by the Minnesota housing finance agency pursuant to 42.24 the provisions of the act. 42.25 This clause applies only to property of a nonprofit or 42.26 limited dividend entity. Property is classified as class 4c 42.27 under this clause for 15 years from the date of the completion 42.28 of the original construction or substantial rehabilitation, or 42.29 for the original term of the loan. 42.30 (2) a structure that is: 42.31 (i) situated upon real property that is used for housing 42.32 lower income families or elderly or handicapped persons, as 42.33 defined in section 8 of the United States Housing Act of 1937, 42.34 as amended; and 42.35 (ii) owned by an entity which has entered into a housing 42.36 assistance payments contract under section 8 which provides 43.1 assistance for 100 percent of the dwelling units in the 43.2 structure, other than dwelling units intended for management or 43.3 maintenance personnel. Property is classified as class 4c under 43.4 this clause for the term of the housing assistance payments 43.5 contract, including all renewals, or for the term of its 43.6 permanent financing, whichever is shorter; and 43.7 (3) a qualified low-income building as defined in section 43.8 42(c)(2) of the Internal Revenue Code of 1986, as amended 43.9 through December 31, 1990, that (i) receives a low-income 43.10 housing credit under section 42 of the Internal Revenue Code of 43.11 1986, as amended through December 31, 1990; or (ii) meets the 43.12 requirements of that section and receives public financing, 43.13 except financing provided under sections 469.174 to 469.179, 43.14 which contains terms restricting the rents; or (iii) meets the 43.15 requirements of section 273.1317. Classification pursuant to 43.16 this clause is limited to a term of 15 years. The public 43.17 financing received must be from at least one of the following 43.18 sources: government issued bonds exempt from taxes under 43.19 section 103 of the Internal Revenue Code of 1986, as amended 43.20 through December 31, 1993, the proceeds of which are used for 43.21 the acquisition or rehabilitation of the building; programs 43.22 under section 221(d)(3), 202, or 236, of Title II of the 43.23 National Housing Act; rental housing program funds under Section 43.24 8 of the United States Housing Act of 1937 or the market rate 43.25 family graduated payment mortgage program funds administered by 43.26 the Minnesota housing finance agency that are used for the 43.27 acquisition or rehabilitation of the building; public financing 43.28 provided by a local government used for the acquisition or 43.29 rehabilitation of the building, including grants or loans from 43.30 federal community development block grants, HOME block grants, 43.31 or residential rental bonds issued under chapter 474A; or other 43.32 rental housing program funds provided by the Minnesota housing 43.33 finance agency for the acquisition or rehabilitation of the 43.34 building. 43.35 For all properties described in clauses (1), (2), and (3) 43.36 and in paragraph (d), the market value determined by the 44.1 assessor must be based on the normal approach to value using 44.2 normal unrestricted rents unless the owner of the property 44.3 elects to have the property assessed under Laws 1991, chapter 44.4 291, article 1, section 55. If the owner of the property elects 44.5 to have the market value determined on the basis of the actual 44.6 restricted rents, as provided in Laws 1991, chapter 291, article 44.7 1, section 55, the property will be assessed at the rate 44.8 provided for class 4a or class 4b property, as appropriate. 44.9 Properties described in clauses (1)(ii), (3), and (4) may apply 44.10 to the assessor for valuation under Laws 1991, chapter 291, 44.11 article 1, section 55. The land on which these structures are 44.12 situated has the class rate given in paragraph (b) if the 44.13 structure contains fewer than four units, and the class rate 44.14 given in paragraph (a) if the structure contains four or more 44.15 units. This clause applies only to the property of a nonprofit 44.16 or limited dividend entity. 44.17 (4) a parcel of land, not to exceed one acre, and its 44.18 improvements or a parcel of unimproved land, not to exceed one 44.19 acre, if it is owned by a neighborhood real estate trust and at 44.20 least 60 percent of the dwelling units, if any, on all land 44.21 owned by the trust are leased to or occupied by lower income 44.22 families or individuals. This clause does not apply to any 44.23 portion of the land or improvements used for nonresidential 44.24 purposes. For purposes of this clause, a lower income family is 44.25 a family with an income that does not exceed 65 percent of the 44.26 median family income for the area, and a lower income individual 44.27 is an individual whose income does not exceed 65 percent of the 44.28 median individual income for the area, as determined by the 44.29 United States Secretary of Housing and Urban Development. For 44.30 purposes of this clause, "neighborhood real estate trust" means 44.31 an entity which is certified by the governing body of the 44.32 municipality in which it is located to have the following 44.33 characteristics: 44.34 (a) it is a nonprofit corporation organized under chapter 44.35 317A; 44.36 (b) it has as its principal purpose providing housing for 45.1 lower income families in a specific geographic community 45.2 designated in its articles or bylaws; 45.3 (c) it limits membership with voting rights to residents of 45.4 the designated community; and 45.5 (d) it has a board of directors consisting of at least 45.6 seven directors, 60 percent of whom are members with voting 45.7 rights and, to the extent feasible, 25 percent of whom are 45.8 elected by resident members of buildings owned by the trust; and 45.9 (5) except as provided in subdivision 22, paragraph (c), 45.10 real property devoted to temporary and seasonal residential 45.11 occupancy for recreation purposes, including real property 45.12 devoted to temporary and seasonal residential occupancy for 45.13 recreation purposes and not devoted to commercial purposes for 45.14 more than 250 days in the year preceding the year of 45.15 assessment. For purposes of this clause, property is devoted to 45.16 a commercial purpose on a specific day if any portion of the 45.17 property is used for residential occupancy, and a fee is charged 45.18 for residential occupancy. Class 4c also includes commercial 45.19 use real property used exclusively for recreational purposes in 45.20 conjunction with class 4c property devoted to temporary and 45.21 seasonal residential occupancy for recreational purposes, up to 45.22 a total of two acres, provided the property is not devoted to 45.23 commercial recreational use for more than 250 days in the year 45.24 preceding the year of assessment and is located within two miles 45.25 of the class 4c property with which it is used. Class 4c 45.26 property classified in this clause also includes the remainder 45.27 of class 1c resorts. Owners of real property devoted to 45.28 temporary and seasonal residential occupancy for recreation 45.29 purposes and all or a portion of which was devoted to commercial 45.30 purposes for not more than 250 days in the year preceding the 45.31 year of assessment desiring classification as class 1c or 4c, 45.32 must submit a declaration to the assessor designating the cabins 45.33 or units occupied for 250 days or less in the year preceding the 45.34 year of assessment by January 15 of the assessment year. Those 45.35 cabins or units and a proportionate share of the land on which 45.36 they are located will be designated class 1c or 4c as otherwise 46.1 provided. The remainder of the cabins or units and a 46.2 proportionate share of the land on which they are located will 46.3 be designated as class 3a. The first $100,000 of the market 46.4 value of the remainder of the cabins or units and a 46.5 proportionate share of the land on which they are located shall 46.6 have a class rate of three percent. The owner of property 46.7 desiring designation as class 1c or 4c property must provide 46.8 guest registers or other records demonstrating that the units 46.9 for which class 1c or 4c designation is sought were not occupied 46.10 for more than 250 days in the year preceding the assessment if 46.11 so requested. The portion of a property operated as a (1) 46.12 restaurant, (2) bar, (3) gift shop, and (4) other nonresidential 46.13 facility operated on a commercial basis not directly related to 46.14 temporary and seasonal residential occupancy for recreation 46.15 purposes shall not qualify for class 1c or 4c; 46.16 (6) real property up to a maximum of one acre of land owned 46.17 by a nonprofit community service oriented organization; provided 46.18 that the property is not used for a revenue-producing activity 46.19 for more than six days in the calendar year preceding the year 46.20 of assessment and the property is not used for residential 46.21 purposes on either a temporary or permanent basis. For purposes 46.22 of this clause, a "nonprofit community service oriented 46.23 organization" means any corporation, society, association, 46.24 foundation, or institution organized and operated exclusively 46.25 for charitable, religious, fraternal, civic, or educational 46.26 purposes, and which is exempt from federal income taxation 46.27 pursuant to section 501(c)(3), (10), or (19) of the Internal 46.28 Revenue Code of 1986, as amended through December 31, 1990. For 46.29 purposes of this clause, "revenue-producing activities" shall 46.30 include but not be limited to property or that portion of the 46.31 property that is used as an on-sale intoxicating liquor or 3.2 46.32 percent malt liquor establishment licensed under chapter 340A, a 46.33 restaurant open to the public, bowling alley, a retail store, 46.34 gambling conducted by organizations licensed under chapter 349, 46.35 an insurance business, or office or other space leased or rented 46.36 to a lessee who conducts a for-profit enterprise on the 47.1 premises. Any portion of the property which is used for 47.2 revenue-producing activities for more than six days in the 47.3 calendar year preceding the year of assessment shall be assessed 47.4 as class 3a. The use of the property for social events open 47.5 exclusively to members and their guests for periods of less than 47.6 24 hours, when an admission is not charged nor any revenues are 47.7 received by the organization shall not be considered a 47.8 revenue-producing activity; 47.9 (7) post-secondary student housing of not more than one 47.10 acre of land that is owned by a nonprofit corporation organized 47.11 under chapter 317A and is used exclusively by a student 47.12 cooperative, sorority, or fraternity for on-campus housing or 47.13 housing located within two miles of the border of a college 47.14 campus; and 47.15 (8) manufactured home parks as defined in section 327.14, 47.16 subdivision 3. 47.17 Class 4c property has a class rate of 2.3 percent of market 47.18 value, except that (i) for each parcel of seasonal residential 47.19 recreational property not used for commercial purposes under 47.20 clause (5) the first $72,000 of market value on each parcel has 47.21 a class rate of1.75 percent for taxes payable in 1997 and1.5 47.22 percent for taxes payable in 1998 and thereafter, and the market 47.23 value of each parcel that exceeds $72,000 has a class rate of 47.24 2.5 percent, and (ii) manufactured home parks assessed under 47.25 clause (8) have a class rate of two percent for taxes payable in 47.26 1996, and thereafter. 47.27 (d) Class 4d property includes: 47.28 (1) a structure that is: 47.29 (i) situated on real property that is used for housing for 47.30 the elderly or for low and moderate income families as defined 47.31 by the Farmers Home Administration; 47.32 (ii) located in a municipality of less than 10,000 47.33 population; and 47.34 (iii) financed by a direct loan or insured loan from the 47.35 Farmers Home Administration. Property is classified under this 47.36 clause for 15 years from the date of the completion of the 48.1 original construction or for the original term of the loan. 48.2 The class rates in paragraph (c), clauses (1), (2), and (3) 48.3 and this clause apply to the properties described in them, only 48.4 in proportion to occupancy of the structure by elderly or 48.5 handicapped persons or low and moderate income families as 48.6 defined in the applicable laws unless construction of the 48.7 structure had been commenced prior to January 1, 1984; or the 48.8 project had been approved by the governing body of the 48.9 municipality in which it is located prior to June 30, 1983; or 48.10 financing of the project had been approved by a federal or state 48.11 agency prior to June 30, 1983. For those properties, 4c or 4d 48.12 classification is available only for those units meeting the 48.13 requirements of section 273.1318. 48.14 Classification under this clause is only available to 48.15 property of a nonprofit or limited dividend entity. 48.16 In the case of a structure financed or refinanced under any 48.17 federal or state mortgage insurance or direct loan program 48.18 exclusively for housing for the elderly or for housing for the 48.19 handicapped, a unit shall be considered occupied so long as it 48.20 is actually occupied by an elderly or handicapped person or, if 48.21 vacant, is held for rental to an elderly or handicapped person. 48.22 (2) For taxes payable in 1992, 1993, and 1994, only, 48.23 buildings and appurtenances, together with the land upon which 48.24 they are located, leased by the occupant under the community 48.25 lending model lease-purchase mortgage loan program administered 48.26 by the Federal National Mortgage Association, provided the 48.27 occupant's income is no greater than 60 percent of the county or 48.28 area median income, adjusted for family size and the building 48.29 consists of existing single family or duplex housing. The lease 48.30 agreement must provide for a portion of the lease payment to be 48.31 escrowed as a nonrefundable down payment on the housing. To 48.32 qualify under this clause, the taxpayer must apply to the county 48.33 assessor by May 30 of each year. The application must be 48.34 accompanied by an affidavit or other proof required by the 48.35 assessor to determine qualification under this clause. 48.36 (3) Qualifying buildings and appurtenances, together with 49.1 the land upon which they are located, leased for a period of up 49.2 to five years by the occupant under a lease-purchase program 49.3 administered by the Minnesota housing finance agency or a 49.4 housing and redevelopment authority authorized under sections 49.5 469.001 to 469.047, provided the occupant's income is no greater 49.6 than 80 percent of the county or area median income, adjusted 49.7 for family size, and the building consists of two or less 49.8 dwelling units. The lease agreement must provide for a portion 49.9 of the lease payment to be escrowed as a nonrefundable down 49.10 payment on the housing. The administering agency shall verify 49.11 the occupants income eligibility and certify to the county 49.12 assessor that the occupant meets the income criteria under this 49.13 paragraph. To qualify under this clause, the taxpayer must 49.14 apply to the county assessor by May 30 of each year. For 49.15 purposes of this section, "qualifying buildings and 49.16 appurtenances" shall be defined as one or two unit residential 49.17 buildings which are unoccupied and have been abandoned and 49.18 boarded for at least six months. 49.19 Class 4d property has a class rate of two percent of market 49.20 value except that property classified under clause (3), shall 49.21 have the same class rate as class 1a property. 49.22 (e) Residential rental property that would otherwise be 49.23 assessed as class 4 property under paragraph (a); paragraph (b), 49.24 clauses (1) and (3); paragraph (c), clause (1), (2), (3), or 49.25 (4), is assessed at the class rate applicable to it under 49.26 Minnesota Statutes 1988, section 273.13, if it is found to be a 49.27 substandard building under section 273.1316. Residential rental 49.28 property that would otherwise be assessed as class 4 property 49.29 under paragraph (d) is assessed at 2.3 percent of market value 49.30 if it is found to be a substandard building under section 49.31 273.1316. 49.32 (f) Class 4e property consists of the residential portion 49.33 of any structure located within a city that was converted from 49.34 nonresidential use to residential use, provided that: 49.35 (1) the structure had formerly been used as a warehouse; 49.36 (2) the structure was originally constructed prior to 1940; 50.1 (3) the conversion was done after December 31, 1995, but 50.2 before January 1, 2003; and 50.3 (4) the conversion involved an investment of at least 50.4 $25,000 per residential unit. 50.5 Class 4e property has a class rate of 2.3 percent, provided 50.6 that a structure is eligible for class 4e classification only in 50.7 the 12 assessment years immediately following the conversion. 50.8 Sec. 3. Minnesota Statutes 1996, section 273.13, is 50.9 amended by adding a subdivision to read: 50.10 Subd. 34. [INFLATION ADJUSTMENT.] Beginning for property 50.11 taxes assessed in 1999, payable in 2000, the commissioner shall 50.12 annually adjust the valuation limits specified in subdivisions 50.13 22 and 23 for inflation. The commissioner shall make the 50.14 inflation adjustments in accordance with section 290.06, 50.15 subdivision 2d, except that for purposes of this subdivision the 50.16 percentage increase shall be determined from the year ending on 50.17 August 31, 1997, to the year ending on August 31 of the year 50.18 preceding the assessment year. The commissioner shall round the 50.19 valuation limits to the nearest $1,000 value. The commissioner 50.20 shall annually announce the adjusted valuation limits at the 50.21 same time provided under section 290.06. The determination of 50.22 the commissioner under this subdivision is not a rule under the 50.23 Administrative Procedure Act. 50.24 Sec. 4. [REPEALER.] 50.25 Minnesota Statutes 1996, section 273.13, subdivision 32, is 50.26 repealed. 50.27 Sec. 5. [EFFECTIVE DATE.] 50.28 Sections 1 to 4 are effective for taxes levied in 1998, 50.29 payable in 1999, and thereafter. 50.30 ARTICLE 3 50.31 STATE AIDS 50.32 Section 1. Minnesota Statutes 1996, section 273.1398, 50.33 subdivision 1, is amended to read: 50.34 Subdivision 1. [DEFINITIONS.] (a) In this section, the 50.35 terms defined in this subdivision have the meanings given them. 50.36 (b) "Unique taxing jurisdiction" means the geographic area 51.1 subject to the same set of local tax rates. 51.2 (c) "Previous net tax capacity" means the product of the 51.3 appropriate net class rates for the year previous to the year in 51.4 which the aid is payable, and estimated market values for the 51.5 assessment two years prior to that in which aid is payable. 51.6 "Total previous net tax capacity" means the previous net tax 51.7 capacities for all property within the unique taxing 51.8 jurisdiction. The total previous net tax capacity shall be 51.9 reduced by the sum of (1) the unique taxing jurisdiction's 51.10 previous net tax capacity of commercial-industrial property as 51.11 defined in section 473F.02, subdivision 3, or 276A.02, 51.12 subdivision 3, multiplied by the ratio determined pursuant to 51.13 section 473F.08, subdivision 6, or 276A.06, subdivision 7, for 51.14 the municipality, as defined in section 473F.02, subdivision 8, 51.15 or 276A.06, subdivision 7, in which the unique taxing 51.16 jurisdiction is located, (2) the previous net tax capacity of 51.17 the captured value of tax increment financing districts as 51.18 defined in section 469.177, subdivision 2, and (3) the previous 51.19 net tax capacity of transmission lines deducted from a local 51.20 government's total net tax capacity under section 273.425. 51.21 Previous net tax capacity cannot be less than zero. 51.22 (d) "Equalized market values" are market values that have 51.23 been equalized by dividing the assessor's estimated market value 51.24 for the second year prior to that in which the aid is payable by 51.25 the assessment sales ratios determined by class in the 51.26 assessment sales ratio study conducted by the department of 51.27 revenue pursuant to section 124.2131 in the second year prior to 51.28 that in which the aid is payable. The equalized market values 51.29 shall equal the unequalized market values divided by the 51.30 assessment sales ratio. 51.31 (e) "Equalized school levies" means the amounts levied for: 51.32 (1) general education under section 124A.23, subdivision 2; 51.33 (2) supplemental revenue under section 124A.22, subdivision 51.34 8a; 51.35 (3) transition revenue under section 124A.22, subdivision 51.36 13c; 52.1 (4) basic transportation under section 124.226, subdivision 52.2 1; and 52.3 (5) referendum revenue under section 124A.03. 52.4 (f) "Current local tax rate" means the quotient derived by 52.5 dividing the taxes levied within a unique taxing jurisdiction 52.6 for taxes payable in the year prior to that for which aids are 52.7 being calculated by the total previous net tax capacity of the 52.8 unique taxing jurisdiction. 52.9 (g) For purposes of calculating and allocating homestead 52.10 and agricultural credit aid authorized pursuant to subdivision 2 52.11 and the disparity reduction aid authorized in subdivision 3, 52.12 "gross taxes levied on all properties," "gross taxes," or "taxes 52.13 levied" means the total net tax capacity based taxes levied on 52.14 all properties except that levied on the captured value of tax 52.15 increment districts as defined in section 469.177, subdivision 52.16 2, and that levied on the portion of commercial industrial 52.17 properties' assessed value or gross tax capacity, as defined in 52.18 section 473F.02, subdivision 3, subject to the areawide tax as 52.19 provided in section 473F.08, subdivision 6, in a unique taxing 52.20 jurisdiction. "Gross taxes" are before any reduction for 52.21 disparity reduction aid but "taxes levied" are after any 52.22 reduction for disparity reduction aid. Gross taxes levied or 52.23 taxes levied cannot be less than zero. 52.24 "Taxes levied" excludes equalized school levies. 52.25 (h) "Household adjustment factor" means the number of 52.26 households for the second most recent year preceding that in 52.27 which the aids are payable divided by the number of households 52.28 for the third most recent year. The household adjustment factor 52.29 cannot be less than one. 52.30 (i)"Growth adjustment factor" means the household52.31adjustment factor in the case of counties. In the case of52.32cities, towns, school districts, and special taxing districts,52.33the growth adjustment factor equals one. The growth adjustment52.34factor cannot be less than one."Homestead and agricultural aid 52.35 reduction percentage" means the ratio of (1) two-thirds of the 52.36 increase in the city local government aid appropriation under 53.1 section 477A.03, subdivision 2, over the appropriated amount in 53.2 1998 to (2) the amount of total city homestead and agricultural 53.3 credit aid paid in 1998. 53.4 (j) "Homestead and agricultural credit base" means the 53.5 previous year's certified homestead and agricultural credit aid 53.6 determined under subdivision 2 less any permanent aid reduction 53.7 in the previous year to homestead and agricultural credit aid. 53.8 (k) "Net tax capacity adjustment" means (1) the tax base 53.9 differential defined in subdivision 1a, multiplied by (2) the 53.10 unique taxing jurisdiction's current local tax rate. The net 53.11 tax capacity adjustment cannot be less than zero. 53.12 (l) "Fiscal disparity adjustment" means a taxing 53.13 jurisdiction's fiscal disparity distribution levy under section 53.14 473F.08, subdivision 3, clause (a), or 276A.06, subdivision 3, 53.15 clause (a), for taxes payable in the year prior to that for 53.16 which aids are being calculated, multiplied by the ratio of the 53.17 tax base differential percent referenced in subdivision 1a for 53.18 the highest class rate for class 3 property for taxes payable in 53.19 the year prior to that for which aids are being calculated to 53.20 the highest class rate for class 3 property for taxes payable in 53.21 the second prior year to that for which aids are being 53.22 calculated. In the case of school districts, the fiscal 53.23 disparity distribution levy shall exclude that part of the levy 53.24 attributable to equalized school levies. 53.25 Sec. 2. Minnesota Statutes 1996, section 273.1398, 53.26 subdivision 2, is amended to read: 53.27 Subd. 2. [HOMESTEAD AND AGRICULTURAL CREDIT AID.] (a) 53.28 Homestead and agricultural credit aid for eachunique taxing53.29jurisdictioncity equalsthe product of (1) the homestead and53.30agricultural credit aid base, and (2) the growth adjustment53.31factor, plus the net tax capacity adjustment and the fiscal53.32disparity adjustmentthe city's certified homestead and 53.33 agricultural credit aid under this subdivision for calendar year 53.34 1998 multiplied by one minus the city's homestead and 53.35 agricultural aid reduction percentage. 53.36 (b) Homestead and agricultural credit aid for each county 54.1 and special taxing district equals its homestead and 54.2 agricultural credit base less 12.5 percent of its 1998 certified 54.3 homestead and agricultural credit aid under this subdivision. 54.4 (c) Homestead and agricultural credit aid is not paid to 54.5 school districts and towns. 54.6 Sec. 3. Minnesota Statutes 1996, section 273.1398, 54.7 subdivision 3, is amended to read: 54.8 Subd. 3. [DISPARITY REDUCTION AID.] For taxes payable in 54.9 1995, and subsequent years, the amount of disparity aid 54.10 certified for each taxing district except school districts 54.11 within each unique taxing jurisdiction for taxes payable in the 54.12 prior year shall be multiplied by the ratio of (1) the 54.13 jurisdiction's tax capacity using the class rates for taxes 54.14 payable in the year for which aid is being computed, to (2) its 54.15 tax capacity using the class rates for taxes payable in the year 54.16 prior to that for which aid is being computed, both based upon 54.17 market values for taxes payable in the year prior to that for 54.18 which aid is being computed. For the purposes of this aid 54.19 determination, disparity reduction aid certified for taxes 54.20 payable in the prior year for a taxing entity other than a town 54.21or school districtis deemed to be county government disparity 54.22 reduction aid. For taxes payable in 1992 and subsequent years, 54.23 the amount of disparity aid certified to each taxing 54.24 jurisdiction shall be reduced by any reductions required in the 54.25 current year or permanent reductions required in previous years 54.26 under section 477A.0132. Disparity reduction aid is not paid to 54.27 school districts. 54.28 Sec. 4. Minnesota Statutes 1996, section 273.1398, 54.29 subdivision 8, is amended to read: 54.30 Subd. 8. [APPROPRIATION.] An amount sufficient to pay the 54.31 aids and credits provided under this section for school 54.32 districts, intermediate school districts, or any group of school 54.33 districts levying as a single taxing entity, is annually 54.34 appropriated from the general fund to the commissioner of 54.35 children, families, and learning. An amount sufficient to pay 54.36 the aids and credits provided under this section for counties, 55.1 cities, towns, and special taxing districts is annually 55.2 appropriated from the general fund to the commissioner of 55.4 revenue. A jurisdiction's aid amount may be increased or 55.5 decreased based on any prior year adjustments for homestead 55.6 credit or other property tax credit or aid programs. 55.7 An amount equal to the difference between (1) the total 55.8 special taxing district homestead and agricultural credit aid 55.9 certified to be paid in 1998, and (2) the total special district 55.10 homestead and agricultural credit aid certified to be paid in 55.11 the current year is annually appropriated from the general fund 55.12 to the metropolitan council for metropolitan transit operations. 55.13 Sec. 5. Minnesota Statutes 1996, section 298.28, 55.14 subdivision 5, is amended to read: 55.15 Subd. 5. [COUNTIES.] (a)16.533 cents per taxable ton is 55.16 allocated to counties to be distributed, based upon 55.17 certification by the commissioner of revenue, under paragraphs 55.18 (b) to (d). 55.19 (b)1326 cents per taxable ton shall be distributed to the 55.20 county in which the taconite is mined or quarried or in which 55.21 the concentrate is produced, less any amount which is to be 55.22 distributed pursuant to paragraph (c). The apportionment 55.23 formula prescribed in subdivision 2 is the basis for the 55.24 distribution. 55.25 (c) If an electric power plant owned by and providing the 55.26 primary source of power for a taxpayer mining and concentrating 55.27 taconite is located in a county other than the county in which 55.28 the mining and the concentrating processes are conducted,one55.29cent2 cents per taxable ton of the tax distributed to the 55.30 counties pursuant to paragraph (b) and imposed on and collected 55.31 from such taxpayer shall be paid to the county in which the 55.32 power plant is located. 55.33 (d)3.57 cents per taxable ton shall be paid to the county 55.34 from which the taconite was mined, quarried or concentrated to 55.35 be deposited in the county road and bridge fund. If the mining, 55.36 quarrying and concentrating, or separate steps in any of those 55.37 processes are carried on in more than one county, the 56.1 commissioner shall follow the apportionment formula prescribed 56.2 in subdivision 2. 56.3 Sec. 6. Minnesota Statutes 1996, section 477A.011, is 56.4 amended by adding a subdivision to read: 56.5 Subd. 3b. [SPRAWL POPULATION.] For a city with a 56.6 population of 5,000 or more which is located outside of the 56.7 metropolitan area, the "sprawl population" is equal to the total 56.8 population of all municipalities and unorganized townships that 56.9 have a geographic center closer to the geographic center of that 56.10 city than to the geographic center of any other city with a 56.11 population of 5,000 or more. For a city with a population that 56.12 is less than 5,000 or a city located in the metropolitan area, 56.13 the sprawl population is zero. 56.14 Sec. 7. Minnesota Statutes 1996, section 477A.011, is 56.15 amended by adding a subdivision to read: 56.16 Subd. 3c. [ADJUSTED POPULATION.] "Adjusted population" is 56.17 the sum of a city's population plus five percent of the city's 56.18 sprawl population. 56.19 Sec. 8. Minnesota Statutes 1996, section 477A.011, is 56.20 amended by adding a subdivision to read: 56.21 Subd. 3d. [POVERTY ADJUSTED POPULATION.] "Poverty adjusted 56.22 population" means the sum of (1) the county's population, and 56.23 (2) three times the average unduplicated number of persons who 56.24 receive benefits per month under general assistance, medical 56.25 assistance, or AFDC, or its successor program, as determined 56.26 under section 256E.06. 56.27 Sec. 9. Minnesota Statutes 1996, section 477A.011, 56.28 subdivision 20, is amended to read: 56.29 Subd. 20. [CITYNET TAX CAPACITY.] "CityNet tax capacity" 56.30 for a local taxing jurisdiction means (1) the net tax capacity 56.31 computed using the net tax capacity rates in section 273.13, and 56.32 the market values for taxes payable in the year prior to the aid 56.33 distribution plus (2) acity'sjurisdiction's fiscal disparities 56.34 distribution tax capacity under section 276A.06, subdivision 2, 56.35 paragraph (b), or 473F.08, subdivision 2, paragraph (b), for 56.36 taxes payable in the year prior to that for which aids are being 57.1 calculated. The market value utilized in computingcitya 57.2 jurisdiction's net tax capacity shall be reduced by the sum of 57.3 (1)a city'sthe jurisdiction's market value of commercial 57.4 industrial property as defined in section 276A.01, subdivision 57.5 3, or 473F.02, subdivision 3, multiplied by the ratio determined 57.6 pursuant to section 276A.06, subdivision 2, paragraph (a), or 57.7 473F.08, subdivision 2, paragraph (a), (2) the market value of 57.8 the captured value of tax increment financing districts as 57.9 defined in section 469.177, subdivision 2, and (3) the market 57.10 value of transmission lines deducted froma city'sthe 57.11 jurisdiction's total net tax capacity under section 273.425. 57.12 The county or city net tax capacity will be computed using 57.13 equalized market values. 57.14 Sec. 10. Minnesota Statutes 1996, section 477A.011, is 57.15 amended by adding a subdivision to read: 57.16 Subd. 34a. [ADJUSTED CITY REVENUE NEED.] For metropolitan 57.17 cities that are: 57.18 (1) cities of the second, third, fourth, or fifth class; 57.19 and 57.20 (2) contiguous to a city of the first class or contiguous 57.21 to a city that is contiguous to a city of the first class; and 57.22 (3) have a median household income under $50,000 according 57.23 to the most recent census, 57.24 the adjusted city revenue need equals 1.2 times the city revenue 57.25 need. For all other cities, the adjusted city revenue need 57.26 equals the city revenue need. 57.27 Sec. 11. Minnesota Statutes 1996, section 477A.011, 57.28 subdivision 35, is amended to read: 57.29 Subd. 35. [TAX EFFORT RATE.] "Tax effort rate" for a type 57.30 of taxing jurisdiction means the sum of the net levy for 57.31 allcitiesjurisdictions of that type divided by the sum of the 57.32citynet tax capacity for allcitiesjurisdictions of that type. 57.33 For purposes of this section, "net levy" means thecitylevy, 57.34 after all adjustments, used for calculating the local tax rate 57.35 under section 275.08 for taxes payable in the year prior to the 57.36 aid distribution. The fiscal disparity distribution levy under 58.1 chapter 276A or 473F is included in net levy. 58.2 Sec. 12. Minnesota Statutes 1996, section 477A.011, 58.3 subdivision 37, is amended to read: 58.4 Subd. 37. [BASE REDUCTION PERCENTAGE.] "Base reduction 58.5 percentage" is a percentage equal to two-thirds of the product 58.6 of: (1) the difference between the amount available for city 58.7 aid under section 477A.03 for the year for which aid is being 58.8 calculated and the amount available for city aid under section 58.9 477A.03 for calendar year19941998, (2) divided by the sum of 58.10 the city aid base for all cities and (3) multiplied by 100. The 58.11 reduction percentage for any year may not be less than the 58.12 reduction percentage from the previous year.For aid paid in58.13calendar year 1994, the reduction percentage is zero.The 58.14 reduction percentage may not be more than 100 percent. 58.15 Sec. 13. Minnesota Statutes 1996, section 477A.011, is 58.16 amended by adding a subdivision to read: 58.17 Subd. 38. [ACRES.] The number of acres in a county are the 58.18 number of acres of land in the jurisdiction, according to the 58.19 most recent federal census, adjusted for any annexations and 58.20 detachments as provided under section 477A.014, subdivision 1. 58.21 Sec. 14. [477A.0125] [COUNTY AID DISTRIBUTIONS.] 58.22 Subdivision 1. [FORMULA AMOUNT.] In calendar year 1999 and 58.23 subsequent years, each county shall receive an aid amount equal 58.24 to the product of (1) an aid percentage, and (2) the sum of (i) 58.25 its poverty weighted population multiplied by 145; and (ii) its 58.26 acres of land multiplied by .40; minus its net tax capacity 58.27 multiplied by 50 percent of the county tax effort rate. The aid 58.28 percentage shall be calculated by the department of revenue so 58.29 that the total aid paid to counties under this section equals 58.30 the amount available for distribution under section 477A.03. 58.31 Sec. 15. Minnesota Statutes 1996, section 477A.013, 58.32 subdivision 1, is amended to read: 58.33 Subdivision 1. [TOWNS.]In 1994 each town that had levied58.34for taxes payable in the prior year a local tax rate of at least58.35.008 shall receive a distribution equal to the amount it58.36received in 1993 under this section before any nonpermanent59.1reductions made under section 477A.0132. In 1995 each town that59.2had levied for taxes payable in 1993 a local tax rate of at59.3least .008 shall receive a distribution equal to 102 percent of59.4the amount it received in 1994 under this section before any59.5increases or reductions under sections 16A.711, subdivision 5,59.6and 477A.0132. In 1996 and subsequent years each town that had59.7levied for taxes payable in 1993 a local tax rate of at least59.8.008 shall receive a distribution equal to the amount it59.9received in the previous year under this section, adjusted for59.10inflation as provided under section 477A.03, subdivision 3.In 59.11 calendar year 1999 and subsequent years, the amount of aid that 59.12 a town receives is equal to the sum of (1) its agricultural 59.13 homestead and agricultural credit aid under section 273.1398, 59.14 subdivision 2, for aid paid in calendar year 1998, and (2) the 59.15 amount it received in calendar year 1998 under this section. 59.16 Sec. 16. Minnesota Statutes 1996, section 477A.013, 59.17 subdivision 8, is amended to read: 59.18 Subd. 8. [CITY FORMULA AID.] In calendar year 1994 and 59.19 subsequent years, the formula aid for a city is equal to the 59.20 need increase percentage multiplied by the difference between 59.21 (1) the adjusted city's revenue need multiplied by its adjusted 59.22 population, and (2) the city's net tax capacity multiplied by 59.23 the tax effort rate. No city may have a formula aid amount less 59.24 than zero. The need increase percentage must be the same for 59.25 all cities. 59.26Notwithstanding the prior sentence, in 1995 only, the need59.27increase percentage for a city shall be twice the need increase59.28percentage applicable to other cities if:59.29(1) the city, in 1992 or 1993, transferred an amount from59.30governmental funds to their sewer and water fund, and59.31(2) the amount transferred exceeded their net levy for59.32taxes payable in the year in which the transfer occurred.59.33 The applicable need increase percentageor percentagesmust 59.34 be calculated by the department of revenue so that the total of 59.35 the aid under subdivision 9 equals the total amount available 59.36 for aid under section 477A.03. 60.1 Sec. 17. Minnesota Statutes 1996, section 477A.013, 60.2 subdivision 9, is amended to read: 60.3 Subd. 9. [CITY AID DISTRIBUTION.] (a) In calendar year 60.419941999 and thereafter, each city shall receive an aid 60.5 distribution equal to the sum of (1) the city formula aid under 60.6 subdivision 8, and (2) its city aid base multiplied by a 60.7 percentage equal to 100 minus the base reduction percentage. 60.8(b) The percentage increase for a first class city in60.9calendar year 1995 and thereafter shall not exceed the60.10percentage increase in the sum of the aid to all cities under60.11this section in the current calendar year compared to the sum of60.12the aid to all cities in the previous year.60.13(c) The total aid for any city, except a first class city,60.14shall not exceed the sum of (1) ten percent of the city's net60.15levy for the year prior to the aid distribution plus (2) its60.16total aid in the previous year before any increases or decreases60.17under sections 16A.711, subdivision 5, and 477A.0132.60.18(d) Notwithstanding paragraph (c), in 1995 only, for cities60.19which in 1992 or 1993 transferred an amount from governmental60.20funds to their sewer and water fund in an amount greater than60.21their net levy for taxes payable in the year in which the60.22transfer occurred, the total aid shall not exceed the sum of (1)60.2320 percent of the city's net levy for the year prior to the aid60.24distribution plus (2) its total aid in the previous year before60.25any increases or decreases under sections 16A.711, subdivision60.265, and 477A.0132.60.27 Sec. 18. Minnesota Statutes 1996, section 477A.014, is 60.28 amended by adding a subdivision to read: 60.29 Subd. 6. [APPROPRIATION.] The amount necessary to pay the 60.30 amounts certified under subdivision 4 is annually appropriated 60.31 from the general fund to the commissioner of revenue. 60.32 Sec. 19. Minnesota Statutes 1996, section 477A.03, 60.33 subdivision 2, is amended to read: 60.34 Subd. 2. [ANNUAL APPROPRIATION.] A sum sufficient to 60.35 discharge the duties imposed by sections 477A.011 to 477A.014 is 60.36 annually appropriated from the general fund to the commissioner 61.1 of revenue. For aids payable in19961999 and thereafter, the 61.2 total aids paid under sections477A.013, subdivision 9,61.3 477A.0121 and 477A.0122 are the amounts certified to be paid in 61.4 the previous year, adjusted for inflation as provided under 61.5 subdivision 3. For aid payable in 1999 and thereafter, aid 61.6 payments to counties under section477A.0121 are limited to61.7$20,265,000 in 1996.477A.0125 are limited to an amount equal to 61.8 the difference between (1) the total county homestead and 61.9 agricultural credit aid certified to be paid in 1998, adjusted 61.10 for inflation as provided in subdivision 3, and (2) the total 61.11 county homestead and agricultural credit aid certified to be 61.12 paid in the current year. For aid payable in 2000 and 61.13 thereafter, aid payments to counties under section 477A.0125 are 61.14 limited to an amount equal to the difference between (1) the sum 61.15 of the total county homestead and agricultural credit aid 61.16 certified to be paid in the previous year and the aid under 61.17 section 477A.0125 certified to be paid under the previous year, 61.18 adjusted for inflation as provided under subdivision 3, and (2) 61.19 the total county homestead and agricultural credit aid certified 61.20 to be paid in the current year. For aid payable in 1999, aid 61.21 payments tocounties under section 477A.0121 are limited to61.22$27,571,625 in 1997. For aid payable in 1998 and thereafter,61.23the total aids paid under section 477A.0121 are the amounts61.24certified to be paid in the previous year, adjusted for61.25inflation as provided under subdivision 3.cities under section 61.26 477A.013, subdivision 9, are limited to the amounts certified to 61.27 be paid the previous year, less the reduction under Minnesota 61.28 Statutes 1996, section 477A.014, subdivision 5, for the previous 61.29 year, multiplied by three times the adjustment for inflation 61.30 provided under subdivision 3. For aid payable in 2000 and 61.31 thereafter, aid payments to cities are limited to the aid 61.32 amounts certified to be paid in the previous year, multiplied by 61.33 three times the adjustment for inflation provided under 61.34 subdivision 3, paragraph (b). 61.35 Sec. 20. Minnesota Statutes 1996, section 477A.03, 61.36 subdivision 3, is amended to read: 62.1 Subd. 3. [INFLATION ADJUSTMENT.] In 1996 and thereafter, 62.2 the amount paid under each section to be adjusted for inflation 62.3 shall be increased by an amount equal to: 62.4 (a) the amount certified to be paid under that section in 62.5 the previous year multiplied by 62.6 (b)one plusthe percentage increase in the implicit price 62.7 deflator for state and local government purchases of goods and 62.8 services prepared by the Bureau of Economic Analysis of the 62.9 United States Department of Commerce for the 12-month period 62.10 ending March 31 of the previous year. The percentage increase 62.11 used in this subdivision shall be no less than 2.5 percent and 62.12 no greater than 5.0 percent. 62.13 Sec. 21. [REPEALER.] 62.14 Minnesota Statutes, sections 477A.014, subdivision 5; and 62.15 477A.05, are repealed. 62.16 Sec. 22. [EFFECTIVE DATE.] 62.17 Sections 1 to 21 are effective for aids payable in 1999, 62.18 and thereafter. 62.19 ARTICLE 4 62.20 PROPERTY TAX REFUNDS 62.21 Section 1. Minnesota Statutes 1996, section 290A.04, 62.22 subdivision 2, is amended to read: 62.23 Subd. 2. [HOMEOWNERS.] A claimant whose property taxes 62.24 payable are in excess of the percentage of the household income 62.25 stated below shall pay an amount equal to the percent of income 62.26 shown for the appropriate household income level along with the 62.27 percent to be paid by the claimant of the remaining amount of 62.28 property taxes payable. The state refund equals the amount of 62.29 property taxes payable that remain, up to the state refund 62.30 amount shown below. 62.31PercentPercentMaximum62.32Household Incomeof IncomePaid byState62.33ClaimantRefund62.34$0 to 1,0291.2 percent18 percent$44062.351,030 to 2,0591.3 percent18 percent$44062.362,060 to 3,0991.4 percent20 percent$44062.373,100 to 4,1291.6 percent20 percent$44062.384,130 to 5,1591.7 percent20 percent$44062.395,160 to 7,2291.9 percent25 percent$44062.407,230 to 8,2592.1 percent25 percent$44062.418,260 to 9,2892.2 percent25 percent$44063.19,290 to 10,3192.3 percent30 percent$44063.210,320 to 11,3492.4 percent30 percent$44063.311,350 to 12,3892.5 percent30 percent$44063.412,390 to 14,4492.6 percent30 percent$44063.514,450 to 15,4792.8 percent35 percent$44063.615,480 to 16,5093.0 percent35 percent$44063.716,510 to 17,5493.2 percent40 percent$44063.817,550 to 21,6693.3 percent40 percent$44063.921,670 to 24,7693.4 percent45 percent$44063.1024,770 to 30,9593.5 percent45 percent$44063.1130,960 to 36,1193.5 percent45 percent$44063.1236,120 to 41,2793.7 percent50 percent$44063.1341,280 to 58,8294.0 percent50 percent$44063.1458,830 to 59,8594.0 percent50 percent$31063.1559,860 to 60,8894.0 percent50 percent$21063.1660,890 to 61,9294.0 percent50 percent$10063.17 Percent Percent Maximum 63.18 Household Income of Income Paid by State 63.19 Claimant Refund 63.20 $0 to 1,149 1.2 percent 18 percent $750 63.21 1,150 to 2,299 1.3 percent 18 percent $750 63.22 2,300 to 3,459 1.4 percent 20 percent $750 63.23 3,460 to 4,609 1.6 percent 20 percent $750 63.24 4,610 to 5,749 1.7 percent 20 percent $750 63.25 5,750 to 8,059 1.9 percent 25 percent $750 63.26 8,060 to 9,209 2.1 percent 25 percent $750 63.27 9,210 to 10,359 2.2 percent 25 percent $750 63.28 10,360 to 11,509 2.3 percent 30 percent $750 63.29 11,510 to 12,659 2.4 percent 30 percent $750 63.30 12,660 to 13,819 2.5 percent 30 percent $750 63.31 13,820 to 16,109 2.6 percent 30 percent $750 63.32 16,110 to 17,259 2.8 percent 35 percent $750 63.33 17,260 to 18,409 3.0 percent 35 percent $750 63.34 18,410 to 19,569 3.2 percent 40 percent $750 63.35 19,570 to 24,159 3.3 percent 40 percent $750 63.36 24,160 to 27,619 3.4 percent 45 percent $750 63.37 27,620 to 34,519 3.5 percent 45 percent $750 63.38 34,520 to 40,279 3.5 percent 45 percent $750 63.39 40,280 to 46,029 3.7 percent 50 percent $750 63.40 46,030 to 65,599 4.0 percent 50 percent $750 63.41 65,600 to 66,749 4.0 percent 50 percent $450 63.42 66,750 to 67,899 4.0 percent 50 percent $300 63.43 67,900 to 69,059 4.0 percent 50 percent $150 63.44 The payment made to a claimant shall be the amount of the 63.45 state refund calculated under this subdivision. No payment is 63.46 allowed if the claimant's household income is$61,930$69,060 or 63.47 more. 63.48 Sec. 2. Minnesota Statutes 1996, section 290A.04, 63.49 subdivision 6, is amended to read: 63.50 Subd. 6. [INFLATION ADJUSTMENT.] Beginning for property 63.51 tax refunds payable in calendar year 1996, the commissioner 63.52 shall annually adjust the dollar amounts of the income 63.53 thresholds and the maximum refunds under subdivisions 2 and 2a 63.54 for inflation. The commissioner shall make the inflation 63.55 adjustments in accordance with section 290.06, subdivision 2d, 63.56 except that for purposes of this subdivision the percentage 64.1 increase shall be determined from the year ending on August 31, 64.2 1994, to the year ending on August 31 of the year preceding that 64.3 in which the refund is payable. The commissioner shall not 64.4 adjust the dollar amounts under subdivision 2 for refunds that 64.5 are payable in calendar year 1999. Beginning for refunds 64.6 payable in 2000, the base year for adjustments of the dollar 64.7 amounts in subdivision 2 is the year ending August 31, 1998. 64.8 The commissioner shall use the appropriate percentage increase 64.9 to annually adjust the income thresholds and maximum refunds 64.10 under subdivisions 2 and 2a for inflation without regard to 64.11 whether or not the income tax brackets are adjusted for 64.12 inflation in that year. The commissioner shall round the 64.13 thresholds and the maximum amounts, as adjusted to the nearest 64.14 $10 amount. If the amount ends in $5, the commissioner shall 64.15 round it up to the next $10 amount. 64.16 The commissioner shall annually announce the adjusted 64.17 refund schedule at the same time provided under section 290.06. 64.18 The determination of the commissioner under this subdivision is 64.19 not a rule under the administrative procedure act. 64.20 Sec. 3. [290B.01] [CITATION.] 64.21 This chapter may be cited as the "State of Minnesota 64.22 Business Property Tax Refund Act." 64.23 Sec. 4. [290B.02] [PURPOSE.] 64.24 The purpose of this chapter is to provide property tax 64.25 relief to certain businesses that own or rent their places of 64.26 business. 64.27 Sec. 5. [290B.03] [DEFINITIONS.] 64.28 Subdivision 1. [GENERALLY.] The following terms when used 64.29 in this chapter have the meanings given to them in this section, 64.30 except where the context indicates a different meaning. 64.31 Subd. 2. [COMMISSIONER.] "Commissioner" means the 64.32 commissioner of revenue of the state of Minnesota. 64.33 Subd. 3. [EMPLOYMENT AND TRAINING SERVICES.] "Employment 64.34 and training services" means programs, activities, and services 64.35 that are designed to assist participants in obtaining and 64.36 retaining employment. 65.1 Subd. 4. [EMPLOYMENT AND TRAINING SERVICE 65.2 PROVIDER.] "Employment and training service provider" means: 65.3 (1) a public, private, or nonprofit employment and training 65.4 agency certified by the commissioner of economic security under 65.5 sections 268.0122, subdivision 3, and 268.871, subdivision 1, or 65.6 approved under section 256J.51, if enacted, and included in the 65.7 county plan submitted under section 256J.50, subdivision 6, if 65.8 enacted; 65.9 (2) a public, private, or nonprofit agency that is not 65.10 certified by the commissioner under clause (1), but with which a 65.11 county has contracted to provide employment and training 65.12 services; or 65.13 (3) a county agency, if the county has opted to provide 65.14 employment and training services. 65.15 Notwithstanding section 268.871, an employment and training 65.16 services provider meeting this definition may deliver employment 65.17 and training services under this chapter. 65.18 Subd. 5. [COUNTY AGENCY.] "County agency" means the agency 65.19 designated by the county board to implement financial assistance 65.20 for current programs and for MFIP-S and the agency responsible 65.21 for enforcement of child support collection, and a county or 65.22 multicounty agency that is authorized under sections 393.01, 65.23 subdivision 7, and 393.07, subdivision 2, to administer MFIP-S, 65.24 if enacted. 65.25 Subd. 6. [MINNESOTA FAMILY INVESTMENT PROGRAM-STATEWIDE OR 65.26 MFIP-S.] "Minnesota family investment program-statewide" or 65.27 "MFIP-S" means the assistance program authorized in chapters 65.28 256J and 256K, if enacted. 65.29 Subd. 7. [CLAIMANT.] (a) "Claimant" means a person or 65.30 business entity which filed a claim authorized by this chapter 65.31 during the calendar year. 65.32 (b) In the case of a claim relating to rent constituting 65.33 property taxes, the claimant must have conducted business in a 65.34 rented or leased unit on which ad valorem taxes or payments made 65.35 in lieu of ad valorem taxes, including payments of special 65.36 assessments imposed in lieu of ad valorem taxes, are payable at 66.1 some time during the calendar year covered by the claim. 66.2 Subd. 8. [RENT CONSTITUTING PROPERTY TAXES.] "Rent 66.3 constituting property taxes" means the amount of gross rent 66.4 actually paid in cash, or its equivalent, which is attributable 66.5 (1) to the property tax paid on the unit or (2) to the amount 66.6 paid in lieu of property taxes, in any calendar year by a 66.7 claimant for the right or occupancy of the claimant's Minnesota 66.8 place of business in the calendar year, and which rent 66.9 constitutes the basis, in the succeeding calendar year, of a 66.10 claim for relief under this chapter by the claimant. The amount 66.11 of rent attributable to property taxes paid or payments in lieu 66.12 made on the unit is determined by multiplying the gross rent 66.13 paid by the claimant for the calendar year for the unit by a 66.14 fraction, the numerator of which is the net tax on the property 66.15 where the unit is located and the denominator of which is the 66.16 total scheduled rent. In no case may the rent constituting 66.17 property taxes exceed 50 percent of the gross rent paid by the 66.18 claimant during that calendar year. 66.19 Subd. 9. [GROSS RENT.] "Gross rent" means rental paid for 66.20 the right of occupancy, at arms-length, of a place of business, 66.21 exclusive of charges for any other services furnished by the 66.22 landlord as a part of the rental agreement, whether expressly 66.23 set out in the rental agreement or not. If the landlord and 66.24 tenant have not dealt with each other at arms-length and the 66.25 commissioner determines that the gross rent charged was 66.26 excessive, the commissioner may adjust the gross rent to a 66.27 reasonable amount for purposes of this chapter. 66.28 Subd. 10. [TOTAL SCHEDULED RENT.] "Total scheduled rent" 66.29 means the sum of the monthly rents assigned to the rental units 66.30 in the property multiplied by 12. The assigned rents are the 66.31 rents effective on April 15. The rents must be an arms-length 66.32 rental, but not including charges for other services furnished 66.33 by the landlord as a part of the rental agreement. In 66.34 determining total scheduled rent, no deduction is allowed for 66.35 vacant units, uncollected rent, or reduced cash rents in units 66.36 occupied by employees or agents of the owner. 67.1 Subd. 11. [PROPERTY TAXES PAYABLE.] "Property taxes 67.2 payable" means the property tax exclusive of special 67.3 assessments, penalties, and interest payable on a claimant's 67.4 place of business after deductions for any state paid property 67.5 tax credits in any calendar year. In the case of a claimant who 67.6 makes ground lease payments, property taxes payable includes the 67.7 amount of the payments directly attributable to the property 67.8 taxes assessed against the parcel on which the building is 67.9 located. 67.10 Subd. 12. [NET TAX.] "Net tax" means: 67.11 (1) the property tax, exclusive of special assessments, 67.12 interest, and penalties, and after reduction for any state paid 67.13 property tax credits as required in subdivision 8; or 67.14 (2) the payments made in lieu of ad valorem taxes, 67.15 including payments of special assessments imposed in lieu of ad 67.16 valorem taxes, for the calendar year in which the rent was 67.17 paid. If a portion of the property is occupied as a place of 67.18 business or is used for other than business purposes, the net 67.19 tax shall be the amount of tax reduced by the percentage that 67.20 the nonbusiness use comprises of the total square footage of the 67.21 building. If a portion of the property is used for other than 67.22 business purposes, the county treasurer shall list on the 67.23 property tax statement the amount of net tax pertaining to the 67.24 business portion of the property. The amount of the net tax 67.25 shall not be reduced by an abatement or a court-ordered 67.26 reduction in the property tax on the property made after the 67.27 certificate of rent constituting property tax has been provided 67.28 to the renter. 67.29 Sec. 6. [290B.04] [REFUND ALLOWABLE.] 67.30 A refund shall be allowed to each claimant who: 67.31 (1) submits a certificate from the county agency of the 67.32 county where the property is located indicating that the 67.33 claimant has cooperated fully with the employment and training 67.34 service provider in providing employment and training 67.35 opportunities to MFIP-S participants; 67.36 (2) provides on-site day care services at no cost to 68.1 employees who work at the property for which the claim is made 68.2 under this section; or 68.3 (3) provides transportation assistance to employees who 68.4 work at the property in the form of employer-sponsored employee 68.5 van pools, or subsidized use of the local transit system. 68.6 For the purposes of clauses (1) to (3), a claimant 68.7 qualifies for a refund under this section, the amount of the 68.8 refund is equal to four percent of the net property tax or rent 68.9 constituting property tax payable on the property. The maximum 68.10 refund allowable to any claimant under this section is $15,000. 68.11 On or before December 1, 1997, the commissioner shall 68.12 estimate the cost of making the payments provided by this 68.13 section for taxes payable in 1998. If the estimated total 68.14 refund claims for taxes payable in 1996 exceed $......., the 68.15 commissioner shall first reduce the four percent refund rate 68.16 enough, but to no lower a rate than two percent, so that the 68.17 estimated total refund claims do not exceed the $....... 68.18 appropriation. If the commissioner estimates that total claims 68.19 will exceed $....... at a two percent refund rate, the 68.20 commissioner shall also reduce the $15,000 maximum refund amount 68.21 by enough so that total estimated refund claims do not exceed 68.22 $........ 68.23 The determinations of the revised thresholds by the 68.24 commissioner are not rules subject to chapter 14. 68.25 Sec. 7. [290B.05] [TIME FOR PAYMENT.] 68.26 Allowable claims filed according to the provisions of this 68.27 chapter shall be paid by the commissioner from the general fund 68.28 after September 15 and before September 30 or 60 days after 68.29 receipt of the application, whichever is later. 68.30 Sec. 8. [290B.06] [PROOF OF CLAIM.] 68.31 Every claimant shall supply to the department of revenue, 68.32 in support of the claim, proof of eligibility under this 68.33 chapter, including, but not limited to, amount of rent paid or 68.34 property taxes accrued, name and address of owner or managing 68.35 agent of property rented, changes in place of business, size, 68.36 and nature of property claimed as a place of business. 69.1 Sec. 9. [290B.07] [PROOF OF TAXES PAID.] 69.2 Every claimant who files a claim for relief for property 69.3 taxes payable shall include with the claim a property tax 69.4 statement or a reproduction of it in a form deemed satisfactory 69.5 by the commissioner indicating that there are no delinquent 69.6 property taxes on the place of business. Indication on the 69.7 property tax statement from the county treasurer that there are 69.8 no delinquent taxes on the place of business shall be sufficient 69.9 proof. Taxes included in a confession of judgment under section 69.10 279.37 shall not constitute delinquent taxes as long as the 69.11 claimant is current on the payments required to be made under 69.12 section 279.37. 69.13 Sec. 10. [290B.08] [PROPERTY TAX STATEMENT.] 69.14 The county treasurer shall prepare and send a sufficient 69.15 number of copies of the property tax statement to the owner, and 69.16 to the owner's escrow agent if the taxes are paid via an escrow 69.17 account, to enable the owner to comply with the filing 69.18 requirements of this chapter and to retain one copy as a 69.19 record. The property tax statement, in a form prescribed by the 69.20 commissioner, shall indicate the manner in which the claimant 69.21 may claim relief from the state and the amount of the tax for 69.22 which the applicant may claim relief. The statement shall also 69.23 indicate if there are delinquent property taxes on the property 69.24 in the preceding year. 69.25 Sec. 11. [290B.09] [CLAIM APPLIED AGAINST OUTSTANDING 69.26 LIABILITY.] 69.27 The amount of any claim otherwise payable under this 69.28 chapter may be applied by the commissioner against any 69.29 delinquent tax liability of the claimant payable to the 69.30 department of revenue. 69.31 Sec. 12. [290B.10] [LAPSE OF RIGHT TO RECEIVE CREDIT.] 69.32 If the commissioner cannot locate the claimant within two 69.33 years from the date that the original warrant was issued, or if 69.34 a claimant to whom a warrant has been issued does not cash that 69.35 warrant within two years from the date the warrant was issued, 69.36 the right to the credit shall lapse, and the warrant shall be 70.1 deposited in the general fund. 70.2 Sec. 13. [290B.11] [OWNER OR MANAGING AGENT TO FURNISH 70.3 RENT CERTIFICATE.] 70.4 Subdivision 1. [DUTY TO FURNISH.] The owner or managing 70.5 agent of any property for which rent is paid for occupancy as a 70.6 place of business must furnish a certificate of rent 70.7 constituting property tax to the person or business entity on 70.8 December 31, in the form prescribed by the commissioner. If the 70.9 business relocates before December 31, the owner or managing 70.10 agent may furnish the certificate to the business at the time of 70.11 moving, or mail the certificate to the forwarding address if an 70.12 address has been provided by the business. The certificate must 70.13 be made available to the business before February 1 of the year 70.14 following the year in which the rent was paid. The owner or 70.15 managing agent must retain a duplicate of each certificate or an 70.16 equivalent record showing the same information for a period of 70.17 three years. The duplicate or other record must be made 70.18 available to the commissioner upon request. 70.19 Subd. 2. [INFORMATION ON CERTIFICATE.] The certificate of 70.20 rent constituting property taxes must include the address of the 70.21 property, including the county, and the property tax parcel 70.22 identification number and any additional information that the 70.23 commissioner determines is appropriate. 70.24 Subd. 3. [FAILURE TO PROVIDE.] If the owner or managing 70.25 agent fails to provide the business with a certificate of rent 70.26 constituting property taxes, the commissioner shall allocate the 70.27 net tax on the building to the unit on a square footage basis or 70.28 other appropriate basis as the commissioner determines. The 70.29 business shall supply the commissioner with a statement from the 70.30 county treasurer that gives the amount of property tax on the 70.31 parcel, the address and property tax parcel identification 70.32 number of the property, and the number of units in the building. 70.33 Subd. 4. [REPORT TO COMMISSIONER.] By January 31 of the 70.34 year following the year in which the rent was collected, each 70.35 owner or managing agent shall report to the commissioner on a 70.36 form prescribed by the commissioner the net tax pertaining to 71.1 the business part of the property, the total scheduled rent, and 71.2 the fraction computed under section 290B.03, subdivision 7. A 71.3 copy of the property tax statement for taxes payable in that 71.4 year must be attached. 71.5 Sec. 14. [290B.12] [RULES.] 71.6 The commissioner shall promulgate rules which the 71.7 commissioner deems appropriate for the administration of this 71.8 chapter and shall also make available forms with instructions 71.9 for claimants as the commissioner deems necessary for the proper 71.10 administration of this chapter. The claim shall be in the form 71.11 the commissioner may prescribe. 71.12 Sec. 15. [290B.13] [ROUNDING.] 71.13 In computing the dollar amount of items on the property tax 71.14 refund claim form and accompanying schedules, items may be 71.15 rounded off to the nearest whole dollar amount, disregarding 71.16 amounts of less than 50 cents and increasing amounts of 50 cents 71.17 to 99 cents to the next highest dollar. 71.18 Sec. 16. [290B.14] [APPROPRIATION.] 71.19 $....... is appropriated from the general fund in the state 71.20 treasury to the commissioner of revenue to make the payments 71.21 required under section 290B.04. 71.22 Sec. 17. [EFFECTIVE DATE.] 71.23 This article is effective for claims based on property 71.24 taxes payable in 1999 and thereafter, and rent constituting 71.25 property taxes paid in 1998 and thereafter. 71.26 ARTICLE 5 71.27 TRUTH IN BUDGETING 71.28 Section 1. Minnesota Statutes 1996, section 16A.103, 71.29 subdivision 1, is amended to read: 71.30 Subdivision 1. [STATE REVENUE AND EXPENDITURES.] In 71.31 February and November each year, the commissioner shall prepare 71.32 and deliver to the governor and legislature a forecast of state 71.33 revenue and expenditures. The forecast must assume the 71.34 continuation of current laws and reasonable estimates of 71.35 projected growth in the national and state economies and 71.36 affected populations. Revenue must be estimated for all sources 72.1 provided for in current law. Expenditures must be estimated for 72.2 all obligations imposed by law and those projected to occur as a 72.3 result of inflation and variables outside the control of the 72.4 legislature. In addition, the commissioner shall forecast 72.5 Minnesota personal income for each of the years covered by the 72.6 forecast and include these estimates in the forecast documents. 72.7 A forecast prepared during the first fiscal year of a biennium 72.8 must cover that biennium and the next biennium. A forecast 72.9 prepared during the second fiscal year of a biennium must cover 72.10 that biennium and the next two bienniums. 72.11 In order to examine long-term trends in state government 72.12 revenues, the commissioner shall also consider in the forecast 72.13 and separately prepare and deliver to the governor and the 72.14 legislature, for each year beginning in 1990, a measure of the 72.15 inflation adjusted general fund revenue per capita. 72.16 Sec. 2. Minnesota Statutes 1996, section 16A.103, 72.17 subdivision 2, is amended to read: 72.18 Subd. 2. [LOCAL REVENUE.] In February and November of each 72.19 year, the commissioner of revenue shall prepare and deliver to 72.20 the governor and the legislature forecasts of revenue to be 72.21 received by school districts as a group, counties as a group, 72.22 and the group of cities and towns that have a population of more 72.23 than 2,500. The forecasts must assume the continuation of 72.24 current laws, projections of valuation changes in real property, 72.25 and reasonable estimates of projected growth in the national and 72.26 state economies and affected populations. Revenue must be 72.27 estimated for property taxes, state and federal aids, local 72.28 sales taxes, if any, and a single projection for all other 72.29 revenue for each group of affected local governmental units. As 72.30 part of the February forecast, the commissioner of revenue shall 72.31 report to the governor and legislature on which groups of local 72.32 government units exceeded the revenue targets of the governor 72.33 and legislature in the most recent biennium. 72.34 In order to examine long-term trends in local government 72.35 revenues, the commissioner shall also consider in the forecast 72.36 and separately prepare and deliver to the governor and the 73.1 legislature, for each year beginning in 1990, for counties as a 73.2 group, and for the group of cities and towns that have a 73.3 population of more than 2,500, a measure of the inflation 73.4 adjusted revenue base per capita. For cities, the inflation 73.5 adjusted revenue base must include an adjustment to account for 73.6 the need to replace tax increment revenue reductions due to 73.7 changes in the property tax system. 73.8 Sec. 3. Minnesota Statutes 1996, section 275.065, 73.9 subdivision 3, is amended to read: 73.10 Subd. 3. [NOTICE OF PROPOSED PROPERTY TAXES.] (a) The 73.11 county auditor shall prepare and the county treasurer shall 73.12 deliver after November 10 and on or before November 24 each 73.13 year, by first class mail to each taxpayer at the address listed 73.14 on the county's current year's assessment roll, a notice of 73.15 proposed property taxes and, in the case of a town, final 73.16 property taxes. 73.17 (b) The commissioner of revenue shall prescribe the form of 73.18 the notice. 73.19 (c) The notice must inform taxpayers that it contains the 73.20 amount of property taxes each taxing authority other than a town 73.21 proposes to collect for taxes payable the following year and, 73.22 for a town, the amount of its final levy. It must clearly state 73.23 that each taxing authority, including regional library districts 73.24 established under section 134.201, and including the 73.25 metropolitan taxing districts as defined in paragraph (i), but 73.26 excluding all other special taxing districts, school districts, 73.27 and towns, will hold a public meeting to receive public 73.28 testimony on the proposed budget and proposed or final property 73.29 tax levy, or, in case of a school district, on the current73.30budget and proposed property tax levy. It must clearly state 73.31 the time and place of each taxing authority's meeting and an 73.32 address where comments will be received by mail. 73.33 (d) The notice must state for each parcel the following 73.34 items listed in this sequential order: 73.35 (1) the market value of the property as determined under 73.36 section 273.11, and used for computing property taxes payable in 74.1 the following year and for taxes payable in the current year; 74.2 and, in the case of residential property, whether the property 74.3 is classified as homestead or nonhomestead. The notice must 74.4 clearly inform taxpayers of the years to which the market values 74.5 apply and that the values are final values; 74.6 (2) the property tax amount for the following year based on 74.7 each taxing authority's constant spending levy amount. This 74.8 amount must be listed by county, city or town, school district, 74.9 the state education tax, the total of the special taxing 74.10 districts, the tax increment tax, if any, the fiscal disparities 74.11 tax, if any, and a total of all taxing authorities; 74.12 (3) the proposed property tax amount for the following year 74.13byfor the county, the city or town, the school district 74.14excess referenda levy, remaining school district levy, regional74.15library district, if in existence, the total of the metropolitan74.16special taxing districts as defined in paragraph (i) and, the 74.17 state education tax, the sum of theremainingspecial taxing 74.18 districts, andasa total of all the taxing authorities,74.19including all special taxing districts, the proposed or, for. 74.20 For a town, the proposed amount is its final net tax on the 74.21 property for taxes payable the following yearand the actual tax74.22for taxes payable the current year. If a school district has 74.23 certified under section 124A.03, subdivision 2, that a 74.24 referendum will be held in the school district at the November 74.25 general election, the county auditor must note next to the 74.26 school district's proposed amount that a referendum is pending 74.27 and that, if approved by the voters, the tax amount may be 74.28 higher than shown on the notice.For the purposes of this74.29subdivision, "school district excess referenda levy" means74.30school district taxes for operating purposes approved at74.31referendums, including those taxes based on net tax capacity as74.32well as those based on market value. "School district excess74.33referenda levy" does not include school district taxes for74.34capital expenditures approved at referendums or school district74.35taxes to pay for the debt service on bonds approved at74.36referenda.In the case of the city of Minneapolis, the levy for 75.1 the Minneapolis library board and the levy for Minneapolis park 75.2 and recreation shall be listed separately from the remaining 75.3 amount of the city's levy. In the case of a parcel where tax 75.4 increment or the fiscal disparities areawide tax under chapter 75.5 276A or 473F applies, the proposed tax levy on the captured 75.6 value or the proposed tax levy on the tax capacity subject to 75.7 the areawide tax must each be stated separately and not included 75.8 in the sum of the special taxing districts;and75.9(3)(4) the increase or decreaseinbetween the amounts in 75.10clauseclauses (2)from taxes payable in the current year to75.11proposed or, for a town, final taxes payable the following year,75.12 and (3) expressed as a dollar amount and as a percentage; and 75.13 (5) the total actual taxes for the current year for all 75.14 taxing authorities for the parcel. 75.15 (e) The notice must clearly state that the proposed or 75.16 final taxes do not include the following: 75.17 (1) special assessments; 75.18 (2) levies approved by the voters after the date the 75.19 proposed taxes are certified, including bond referenda, school 75.20 district levy referenda, and levy limit increase referenda; 75.21 (3) amounts necessary to pay cleanup or other costs due to 75.22 a natural disaster occurring after the date the proposed taxes 75.23 are certified; 75.24 (4) amounts necessary to pay tort judgments against the 75.25 taxing authority that become final after the date the proposed 75.26 taxes are certified; and 75.27 (5) the contamination tax imposed on properties which 75.28 received market value reductions for contamination. 75.29 (f) Except as provided in subdivision 7, failure of the 75.30 county auditor to prepare or the county treasurer to deliver the 75.31 notice as required in this section does not invalidate the 75.32 proposed or final tax levy or the taxes payable pursuant to the 75.33 tax levy. 75.34 (g) If the notice the taxpayer receives under this section 75.35 lists the property as nonhomestead and the homeowner provides 75.36 satisfactory documentation to the county assessor that the 76.1 property is owned and used as the owner's homestead, the 76.2 assessor shall reclassify the property to homestead for taxes 76.3 payable in the following year. 76.4 (h) In the case of class 4 residential property used as a 76.5 residence for lease or rental periods of 30 days or more, the 76.6 taxpayer must either: 76.7 (1) mail or deliver a copy of the notice of proposed 76.8 property taxes to each tenant, renter, or lessee; or 76.9 (2) post a copy of the notice in a conspicuous place on the 76.10 premises of the property. 76.11 The notice must be mailed or posted by the taxpayer by 76.12 November 27 or within three days of receipt of the notice, 76.13 whichever is later. A taxpayer may notify the county treasurer 76.14 of the address of the taxpayer, agent, caretaker, or manager of 76.15 the premises to which the notice must be mailed in order to 76.16 fulfill the requirements of this paragraph. 76.17 (i) For purposes of this subdivision, subdivisions 5a and 76.18 6, "metropolitan special taxing districts" means the following 76.19 taxing districts in the seven-county metropolitan area that levy 76.20 a property tax for any of the specified purposes listed below: 76.21 (1) metropolitan council under section 473.132, 473.167, 76.22 473.249, 473.325, 473.446, 473.521, 473.547, or 473.834; 76.23 (2) metropolitan airports commission under section 473.667, 76.24 473.671, or 473.672; and 76.25 (3) metropolitan mosquito control commission under section 76.26 473.711. 76.27 For purposes of this section, any levies made by the 76.28 regional rail authorities in the county of Anoka, Carver, 76.29 Dakota, Hennepin, Ramsey, Scott, or Washington under chapter 76.30 398A shall be included with the appropriate county's levy and 76.31 shall be discussed at that county's public hearing. 76.32(j) For taxes levied in 1996, payable in 1997 only, in the76.33case of a statutory or home rule charter city or town that76.34exercises the local levy option provided in section 473.388,76.35subdivision 7, the notice of its proposed taxes may include a76.36statement of the amount by which its proposed tax increase for77.1taxes payable in 1997 is attributable to its exercise of that77.2option, together with a statement that the levy of the77.3metropolitan council was decreased by a similar amount because77.4of the exercise of that option.77.5 Sec. 4. Minnesota Statutes 1996, section 275.065, is 77.6 amended by adding a subdivision to read: 77.7 Subd. 3a. [CONSTANT SPENDING LEVY AMOUNT.] (a) For 77.8 purposes of this section, "constant spending levy amount" for 77.9 calendar year 1999 for a county, school district, city, town, or 77.10 special taxing district means the proposed property tax levy 77.11 that the taxing authority would need to levy so that the sum of 77.12 its levy, including its fiscal disparities distribution levy 77.13 under section 276A.06, subdivision 3, clause (a), or 473F.08, 77.14 subdivision 3, clause (a), plus its property tax aid amounts and 77.15 tax increment revenues would equal the product of: 77.16 (1) the 1998 property tax levy including its fiscal 77.17 disparities distribution levy under section 276A.06, subdivision 77.18 3, clause (a), or 473F.08, subdivision 3, clause (a), plus the 77.19 current property tax aids, plus current tax increment revenues; 77.20 (2) for a county, city, or town, its population growth 77.21 rate; and 77.22 (3) the implicit price deflator. 77.23 (b) For purposes of this section, "constant spending levy 77.24 amount" for calendar year 2000 and subsequent years for a 77.25 county, school district, city, town, or special taxing district 77.26 means the proposed property tax levy that the taxing authority 77.27 would need to levy so that the sum of its levy, including its 77.28 fiscal disparities distribution levy under section 276A.06, 77.29 subdivision 3, clause (a), or 473F.08, subdivision 3, clause 77.30 (a), plus its property tax aid amounts would equal the product 77.31 of: 77.32 (1) the current year property tax levy including its fiscal 77.33 disparities distribution levy under section 276A.06, subdivision 77.34 3, clause (a), or 473F.08, subdivision 3, clause (a), plus the 77.35 current property tax aids; 77.36 (2) for a county, city, or town, its population growth 78.1 rate; and 78.2 (3) the implicit price deflator. 78.3 (c) For the purposes of this subdivision: 78.4 (1) "property tax aids" includes homestead and agricultural 78.5 credit aid and disparity reduction aid under section 273.1398, 78.6 local government aid under sections 477A.012, 477A.0125, and 78.7 477A.013; county criminal justice aid under section 477A.0121; 78.8 family preservation aid under section 477A.0122, and taconite 78.9 aid; 78.10 (2) "tax increment revenues" means the product of the 78.11 taxing authority's tax rate for the current year and the total 78.12 tax increment captured net tax capacity; 78.13 (3) "population growth rate" means the greater of one or 78.14 the ratio of the city population for the most current 12-month 78.15 period available, divided by the city population for the 78.16 12-month period previous to the most current year available; and 78.17 (4) "implicit price deflator" means one plus the rate of 78.18 increase in the implicit price deflator for state and local 78.19 government purchases of goods and services prepared by the 78.20 Bureau of Economic Analysis of the United States Department of 78.21 Commerce for the most current 12-month period available. 78.22 (d) For purposes of the state education tax, "constant 78.23 spending levy amount" means the state education tax in the 78.24 current year. 78.25 Sec. 5. Minnesota Statutes 1996, section 275.065, 78.26 subdivision 5a, is amended to read: 78.27 Subd. 5a. [PUBLIC ADVERTISEMENT.] (a) A city that has a 78.28 population of more than 2,500, county, a metropolitan special 78.29 taxing district as defined in subdivision 3, paragraph (i), or a 78.30 regional library district established under section 134.201, or78.31school districtshall advertise in a newspaper a notice of its 78.32 intent to adopt a budget and property tax levyor, in the case78.33of a school district, to review its current budget and78.34proposedfor property taxes payable in the following year, at a 78.35 public hearing. The notice must be published not less than two 78.36 business days nor more than six business days before the hearing. 79.1 The advertisement must be at least one-eighth page in size 79.2 of a standard-size or a tabloid-size newspaper. The 79.3 advertisement must not be placed in the part of the newspaper 79.4 where legal notices and classified advertisements appear. The 79.5 advertisement must be published in an official newspaper of 79.6 general circulation in the taxing authority. The newspaper 79.7 selected must be one of general interest and readership in the 79.8 community, and not one of limited subject matter. The 79.9 advertisement must appear in a newspaper that is published at 79.10 least once per week. 79.11 For purposes of this section, the metropolitan special 79.12 taxing district's advertisement must only be published in the 79.13 Minneapolis Star and Tribune and the Saint Paul Pioneer Press. 79.14 (b) The advertisement for metropolitan special taxing 79.15 districts and regional library districts must be in the 79.16 following form, except that the notice for a school district may79.17include references to the current budget in regard to proposed79.18property taxes. 79.19 "NOTICE OF 79.20 PROPOSED PROPERTY TAXES 79.21 (City/County/School District/Metropolitan 79.22 Special Taxing District/Regional 79.23 Library District) of ......... 79.24 The governing body of ........ will soon hold budget hearings 79.25 and vote on the property taxes for (city/county/metropolitan 79.26 special taxing district/regional library district services that 79.27 will be provided in199_/school district services that will be79.28provided in 199_ and 199_(year)). 79.29 NOTICE OF PUBLIC HEARING: 79.30 All concerned citizens are invited to attend a public hearing 79.31 and express their opinions on the proposed (city/county/school79.32district/metropolitan special taxing district/regional library 79.33 district) budget and property taxes,or in the case of a school79.34district, its current budget and proposed property taxes,79.35 payable in the following year. The hearing will be held on 79.36 (Month/Day/Year) at (Time) at (Location, Address)." 80.1 (c) The advertisement for cities and counties must be in 80.2 the following form. 80.3 "NOTICE OF PROPOSED 80.4 TOTAL BUDGET AND PROPERTY TAXES 80.5 The (city/county) governing body or board of commissioners will 80.6 hold a public hearing to discuss the budget and to vote on the 80.7 amount of property taxes to collect for services the 80.8 (city/county) will provide in (year). 80.9 80.10 SPENDING: The total budget amounts below compare 80.11 (city's/county's) (year) total actual budget with the amount the 80.12 (city/county) proposes to spend in (year). 80.13 80.14 (Year) Total Proposed (Year) Change from 80.15 Actual Budget Budget (Year)-(Year) 80.16 80.17 $....... $....... ...% 80.18 80.19 TAXES: The property tax amounts below compare that portion of 80.20 the current budget levied in property taxes in (city/county) for 80.21 (year) with the property taxes the (city/county) proposes to 80.22 collect in (year). 80.23 80.24 (Year) Property Proposed (Year) Change from 80.25 Taxes Property Taxes (Year)-(Year) 80.26 80.27 $....... $....... ...% 80.28 80.29 ATTEND THE PUBLIC HEARING 80.30 All (city/county) residents are invited to attend the public 80.31 hearing of the (city/county) to express your opinions on the 80.32 budget and the proposed amount of (year) property taxes. The 80.33 hearing will be held on: 80.34 (Month/Day/Year/Time) 80.35 (Location/Address) 80.36 If the discussion of the budget cannot be completed, a time and 81.1 place for continuing the discussion will be announced at the 81.2 hearing. You are also invited to send your written comments to: 81.3 (City/County) 81.4 (Location/Address)" 81.5 (d) For purposes of this subdivision, the budget amounts 81.6 listed on the advertisement mean: 81.7 (1) for cities, the total government fund expenditures, as 81.8 defined by the state auditor under section 471.6965, less any 81.9 expenditures for improvements or services that are specially 81.10 assessed or charged under chapter 429, 430, 435, or the 81.11 provisions of any other law or charter; and 81.12 (2) for counties, the total government fund expenditures, 81.13 as defined by the state auditor under section 375.169, less any 81.14 expenditures for direct payments to recipients or providers for 81.15 the human service aids listed in section 273.1398, subdivision 81.16 1, paragraph (i). 81.17(c)(e) A city with a population of over 500 but not more 81.18 than 2,500 must advertise by posted notice as defined in section 81.19 645.12, subdivision 1. The advertisement must be posted at the 81.20 time provided in paragraph (a). It must be in the form required 81.21 in paragraph (b). 81.22(d)(f) For purposes of this subdivision, the population of 81.23 a city is the most recent population as determined by the state 81.24 demographer under section 4A.02. 81.25(e)(g) The commissioner of revenue, subject to the 81.26 approval of the chairs of the house and senate tax committees, 81.27 shall prescribe the form and format of the advertisement. 81.28(f) For calendar year 1993, each taxing authority required81.29to publish an advertisement must include on the advertisement a81.30statement that information on the increases or decreases of the81.31total budget, including employee and independent contractor81.32compensation in the prior year, current year, and proposed81.33budget year will be discussed at the hearing.81.34(g) Notwithstanding paragraph (f), for 1993, the81.35commissioner of revenue shall prescribe the form, format, and81.36content of an advertisement comparing current and proposed82.1expense budgets for the metropolitan council, the metropolitan82.2airports commission, and the metropolitan mosquito control82.3commission. The expense budget must include occupancy,82.4personnel, contractual and capital improvement expenses. The82.5form, format, and content of the advertisement must be approved82.6by the chairs of the house and senate tax committees prior to82.7publication.82.8 Sec. 6. Minnesota Statutes 1996, section 275.065, 82.9 subdivision 6, is amended to read: 82.10 Subd. 6. [PUBLIC HEARING; ADOPTION OF BUDGET AND LEVY.] 82.11 Between November 29 and December 20, the governing bodies of a 82.12 city that has a population over 500, county, metropolitan 82.13 special taxing districts as defined in subdivision 3, paragraph 82.14 (i), and regional library districts shall each hold a public 82.15 hearing to discuss and seek public comment on its final budget 82.16 and property tax levy for taxes payable in the following year, 82.17 andthe governing body of the school districtshall hold a 82.18 public hearing to review its current budget and proposed 82.19 property tax levy for taxes payable in the following year. The 82.20 metropolitan special taxing districts shall be required to hold 82.21 only a single joint public hearing, the location of which will 82.22 be determined by the affected metropolitan agencies. 82.23 At a subsequent hearing, each county,school district,82.24 city, and metropolitan special taxing district may amend its 82.25 proposed property tax levy and must adopt a final property tax 82.26 levy. Each county, city, and metropolitan special taxing 82.27 district may also amend its proposed budget and must adopt a 82.28 final budget at the subsequent hearing.A school district is82.29not required to adopt its final budget at the subsequent82.30hearing.The subsequent hearing of a taxing authority must be 82.31 held on a date subsequent to the date of the taxing authority's 82.32 initial public hearing, or subsequent to the date of its 82.33 continuation hearing if a continuation hearing is held. The 82.34 subsequent hearing may be held at a regularly scheduled board or 82.35 council meeting or at a special meeting scheduled for the 82.36 purposes of the subsequent hearing. The subsequent hearing of a 83.1 taxing authority does not have to be coordinated by the county 83.2 auditor to prevent a conflict with an initial hearing, a 83.3 continuation hearing, or a subsequent hearing of any other 83.4 taxing authority. All subsequent hearings must be held prior to 83.5 five working days after December 20 of the levy year. 83.6 The time and place of the subsequent hearing must be 83.7 announced at the initial public hearing or at the continuation 83.8 hearing. 83.9 The property tax levy certified under section 275.07 by a 83.10 city, county, metropolitan special taxing district, regional 83.11 library district, or school district must not exceed the 83.12 proposed levy determined under subdivision 1, except by an 83.13 amount up to the sum of the following amounts: 83.14 (1) the amount of a school district levy whose voters 83.15 approved a referendum to increase taxes under section 124.82, 83.16 subdivision 3,124A.03, subdivision 2, or 124B.03, subdivision83.172,after the proposed levy was certified; 83.18 (2) the amount of a city or county levy approved by the 83.19 voters after the proposed levy was certified; 83.20 (3) the amount of a levy to pay principal and interest on 83.21 bonds approved by the voters under section 475.58 after the 83.22 proposed levy was certified; 83.23 (4) the amount of a levy to pay costs due to a natural 83.24 disaster occurring after the proposed levy was certified, if 83.25 that amount is approved by the commissioner of revenue under 83.26 subdivision 6a; 83.27 (5) the amount of a levy to pay tort judgments against a 83.28 taxing authority that become final after the proposed levy was 83.29 certified, if the amount is approved by the commissioner of 83.30 revenue under subdivision 6a; 83.31 (6) the amount of an increase in levy limits certified to 83.32 the taxing authority by the commissioner of children, families, 83.33 and learning or the commissioner of revenue after the proposed 83.34 levy was certified; and 83.35 (7) the amount required under section 124.755. 83.36 At the hearing under this subdivision, the percentage 84.1 increase in property taxes proposed by the taxing authority, if 84.2 any, and the specific purposes for which property tax revenues 84.3 are being increased must be discussed. 84.4 During the discussion, the governing body shall hear 84.5 comments regarding a proposed increase and explain the reasons 84.6 for the proposed increase. The public shall be allowed to speak 84.7 and to ask questions. At the subsequent hearing held as 84.8 provided in this subdivision, the governing body, other than the84.9governing body of a school district,shall adopt its final 84.10 property tax levy prior to adopting its final budget. 84.11 If the hearing is not completed on its scheduled date, the 84.12 taxing authority must announce, prior to adjournment of the 84.13 hearing, the date, time, and place for the continuation of the 84.14 hearing. The continued hearing must be held at least five 84.15 business days but no more than 14 business days after the 84.16 original hearing. 84.17 The hearing must be held after 5:00 p.m. if scheduled on a 84.18 day other than Saturday. No hearing may be held on a Sunday. 84.19 The governing body of a county shall hold a hearing on the 84.20 second Tuesday in December each year, and may hold additional 84.21 hearings on other dates before December 20 if necessary for the 84.22 convenience of county residents. If the county needs a 84.23 continuation of its hearing, the continued hearing shall be held 84.24 on the third Tuesday in December. If the third Tuesday in 84.25 December falls on December 21, the county's continuation hearing 84.26 shall be held on Monday, December 20. The county auditor shall 84.27 provide for the coordination of hearing dates for all cities and 84.28 school districts within the county. 84.29 The metropolitan special taxing districts shall hold a 84.30 joint public hearing on the first Monday of December. A 84.31 continuation hearing, if necessary, shall be held on the second 84.32 Monday of December. 84.33 By August 10,each school board andthe board of the 84.34 regional library district shall certify to the county auditors 84.35 of the counties in which the school district or regional library 84.36 district is located the dates on which it elects to hold its 85.1 hearings and any continuations. If aschool board orregional 85.2 library district does not certify the dates by August 10, the 85.3 auditor will assign the hearing date. The dates elected or 85.4 assigned must not conflict with the hearing dates of the county 85.5 or the metropolitan special taxing districts. By August 20, the 85.6 county auditor shall notify the clerks of the cities within the 85.7 county of the dates on whichschool districts andregional 85.8 library districts have elected to hold their hearings. At the 85.9 time a city certifies its proposed levy under subdivision 1 it 85.10 shall certify the dates on which it elects to hold its hearings 85.11 and any continuations. For its initial hearing and for the 85.12 subsequent hearing at which the final property tax levy will be 85.13 adopted, the city must not select dates that conflict with the 85.14 county hearing dates, metropolitan special taxing district 85.15 dates, or with those elected by or assigned to theschool85.16districts orregional library district in which the city is 85.17 located. For continuation hearings, the city may select dates 85.18 that conflict with other taxing authorities' dates if the city 85.19 deems it necessary. 85.20 The county hearing dates and the city, metropolitan special 85.21 taxing district, and regional library district, and school85.22districthearing dates must be designated on the notices 85.23 required under subdivision 3. The continuation dates need not 85.24 be stated on the notices. 85.25 This subdivision does not apply to towns, school districts, 85.26 and special taxing districts other than regional library 85.27 districts and metropolitan special taxing districts. 85.28 Notwithstanding the requirements of this section, the 85.29 employer is required to meet and negotiate over employee 85.30 compensation as provided for in chapter 179A. 85.31 Sec. 7. Minnesota Statutes 1996, section 276.04, 85.32 subdivision 2, is amended to read: 85.33 Subd. 2. [CONTENTS OF TAX STATEMENTS.] (a) The treasurer 85.34 shall provide for the printing of the tax statements. The 85.35 commissioner of revenue shall prescribe the form of the property 85.36 tax statement and its contents. The statement must contain a 86.1 tabulated statement of the dollar amount due to each taxing 86.2 authority and the state from the parcel of real property for 86.3 which a particular tax statement is prepared. The dollar 86.4 amounts due the county, state general education tax, the school 86.5 district, township or municipality, the total of the 86.6 metropolitan special taxing districts as defined in section 86.7 275.065, subdivision 3, paragraph (i),school district excess86.8referenda levy, remaining school district levy, and the total of86.9other voter approved referenda levies based on market value86.10under section 275.61must be separately stated. The amounts due 86.11 all other special taxing districts, if any, may be 86.12 aggregated.For the purposes of this subdivision, "school86.13district excess referenda levy" means school district taxes for86.14operating purposes approved at referenda, including those taxes86.15based on net tax capacity as well as those based on market86.16value. "School district excess referenda levy" does not include86.17school district taxes for capital expenditures approved at86.18referendums or school district taxes to pay for the debt service86.19on bonds approved at referenda.The amount of the tax on 86.20 contamination value imposed under sections 270.91 to 270.98, if 86.21 any, must also be separately stated. The dollar amounts, 86.22 including the dollar amount of any special assessments, may be 86.23 rounded to the nearest even whole dollar. For purposes of this 86.24 section whole odd-numbered dollars may be adjusted to the next 86.25 higher even-numbered dollar. The amount of market value 86.26 excluded under section 273.11, subdivision 16, if any, must also 86.27 be listed on the tax statement. The statement shall include the 86.28 following sentence, printed in upper case letters in boldface 86.29 print: "THE STATE OF MINNESOTA DOES NOT RECEIVE ANY PROPERTY86.30TAX REVENUES.THE STATE OF MINNESOTA REDUCES YOUR PROPERTY TAX 86.31 BY PAYING CREDITS AND REIMBURSEMENTS TO LOCAL UNITS OF 86.32 GOVERNMENT." 86.33 (b) The property tax statements for manufactured homes and 86.34 sectional structures taxed as personal property shall contain 86.35 the same information that is required on the tax statements for 86.36 real property. 87.1 (c) Real and personal property tax statements must contain 87.2 the following information in the order given in this paragraph. 87.3 The information must contain the current year tax information in 87.4 the right column with the corresponding information for the 87.5 previous year in a column on the left: 87.6 (1) the property's estimated market value under section 87.7 273.11, subdivision 1; 87.8 (2) the property's taxable market value after reductions 87.9 under section 273.11, subdivisions 1a and 16; 87.10 (3) the property's gross tax, calculated bymultiplying the87.11property's gross tax capacity times the total local tax rate and87.12 adding the property's total property tax tothe resultthe sum 87.13 of the aids enumerated in clause (4); 87.14 (4) a total of the following aids: 87.15 (i) education aids payable under chapters 124 and 124A; 87.16 (ii) local government aids for cities, towns, and counties 87.17 under chapter 477A; and 87.18 (iii) disparity reduction aid under section 273.1398; 87.19(5) for homestead residential and agricultural properties,87.20the homestead and agricultural credit aid apportioned to the87.21property. This amount is obtained by multiplying the total87.22local tax rate by the difference between the property's gross87.23and net tax capacities under section 273.13. This amount must87.24be separately stated and identified as "homestead and87.25agricultural credit." For purposes of comparison with the87.26previous year's amount for the statement for taxes payable in87.271990, the statement must show the homestead credit for taxes87.28payable in 1989 under section 273.13, and the agricultural87.29credit under section 273.132 for taxes payable in 1989;87.30 (6) any credits received under sections 273.119; 273.123; 87.31 273.135; 273.1391; 273.1398, subdivision 4; 469.171; and 87.32 473H.10, except that the amount of credit received under section 87.33 273.135 must be separately stated and identified as "taconite 87.34 tax relief"; and 87.35 (7) the net tax payable in the manner required in paragraph 87.36 (a). 88.1 (d) If the county uses envelopes for mailing property tax 88.2 statements and if the county agrees, a taxing district may 88.3 include a notice with the property tax statement notifying 88.4 taxpayers when the taxing district will begin its budget 88.5 deliberations for the current year, and encouraging taxpayers to 88.6 attend the hearings. If the county allows notices to be 88.7 included in the envelope containing the property tax statement, 88.8 and if more than one taxing district relative to a given 88.9 property decides to include a notice with the tax statement, the 88.10 county treasurer or auditor must coordinate the process and may 88.11 combine the information on a single announcement. 88.12 The commissioner of revenue shall certify to the county 88.13 auditor the actual or estimated aids enumerated in clauses (3) 88.14 and (4) that local governments will receive in the following 88.15 year.In the case of a county containing a city of the first88.16class, for taxes levied in 1991, and for all counties for taxes88.17levied in 1992 and thereafter,The commissioner must certify 88.18 this amount by September 1 of each year. 88.19 Sec. 8. [DEPARTMENT OF REVENUE; STATE BUDGET STUDY.] 88.20 The commissioner of revenue shall study the feasibility of 88.21 enacting "truth in budgeting" requirements for state 88.22 government. The study shall consider ways to make the state 88.23 budget and state budget procedures more accessible and 88.24 understandable to state taxpayers. The study shall also 88.25 consider ways to increase taxpayer participation in the state 88.26 budget process, including the feasibility of public budget 88.27 presentations and hearings in selected locations around the 88.28 state. The commissioner shall report to the legislature on the 88.29 results of the study by January 15, 1998. 88.30 Sec. 9. [EFFECTIVE DATE.] 88.31 Sections 3 and 4 are effective for notices prepared 88.32 beginning in 1998 for taxes payable in 1999, and thereafter. 88.33 Section 5 is effective for newspaper advertisements 88.34 prepared beginning in 1998 for taxes payable in 1999, and 88.35 thereafter. 88.36 Section 6 is effective for public hearings beginning in 89.1 1998, and thereafter. 89.2 Section 7 is effective for property tax statements prepared 89.3 in 1999, and thereafter. 89.4 Section 8 is effective the day following final enactment. 89.5 ARTICLE 6 89.6 SALES TAX 89.7 Section 1. Minnesota Statutes 1996, section 297A.15, is 89.8 amended by adding a subdivision to read: 89.9 Subd. 8. [REFUND; APPROPRIATION.] Notwithstanding the 89.10 provisions of section 297A.25, subdivision 62, the tax on sales 89.11 of construction materials and supplies, shall be imposed and 89.12 collected as if the rate under section 297A.02, subdivision 1, 89.13 applied. Upon application by the purchaser, on forms prescribed 89.14 by the commissioner, a refund equal to the reduction in the tax 89.15 due as a result of the application of the exemption under 89.16 section 297A.25, subdivision 62, shall be paid to the 89.17 purchaser. The application must include sufficient information 89.18 to permit the commissioner to verify the sales tax paid. The 89.19 application shall include information necessary for the 89.20 commissioner initially to verify that the purchases qualified 89.21 for the exemption under section 297A.25, subdivision 62. No 89.22 more than two applications for refunds may be filed under this 89.23 subdivision in a calendar year. Unless otherwise specifically 89.24 provided by this subdivision, the provisions of section 289A.40 89.25 apply to the refunds payable under this subdivision. There is 89.26 annually appropriated to the commissioner of revenue the amount 89.27 required to make the refunds. 89.28 The amount to be refunded shall bear interest at the rate 89.29 in section 270.76 from the date the refund claim is filed with 89.30 the commissioner. 89.31 Sec. 2. Minnesota Statutes 1996, section 297A.25, is 89.32 amended by adding a subdivision to read: 89.33 Subd. 62. [CONSTRUCTION MATERIALS; FIRST CLASS 89.34 CITIES.] Construction materials and supplies are exempt from the 89.35 tax imposed under this chapter, regardless of whether purchased 89.36 by the owner or a contractor, subcontractor, or builder, if the 90.1 materials and supplies are used or consumed in the construction 90.2 or physical expansion of structures or facilities classified as 90.3 class 3 property under section 273.13, subdivision 24, and 90.4 located within a city of the first class. 90.5 The tax on the gross receipts for construction materials 90.6 and supplies exempt under this section must be imposed and 90.7 collected as if the sale were taxable and then refunded to the 90.8 taxpayer as prescribed in section 297A.15, subdivision 8. 90.9 Sec. 3. [EFFECTIVE DATE.] 90.10 Sections 1 and 2 are effective for sales of construction 90.11 materials and supplies after June 30, 1997. 90.12 ARTICLE 7 90.13 SCHOOL FACILITIES CHARGES 90.14 Section 1. [281A.01] [SCHOOL FACILITY CHARGES.] 90.15 Subdivision 1. [REVENUE DEPARTMENT.] The commissioner of 90.16 revenue shall administer the future school facilities fee 90.17 program. 90.18 Subd. 2. [DEFINITIONS.] For purposes of this section the 90.19 following terms have the meanings given them. "2020 MUSA" means 90.20 the 2020 metropolitan urban service area established in the 90.21 local comprehensive plans that are approved by the metropolitan 90.22 council. "Qualifying area" means the land designated for urban 90.23 services in the 2020 MUSA but not that land included in the 90.24 metropolitan urban service area designated for urban services 90.25 contained in local comprehensive plans that were approved by the 90.26 metropolitan council on or before July 1, 1997. 90.27 Subd. 3. [APPLICATION.] The future school facilities fee 90.28 applies to new residential construction in qualifying areas for 90.29 which residential zoning is approved after July 1, 1997. 90.30 Subd. 4. [FUTURE SCHOOL FACILITY FEE AMOUNT.] A future 90.31 school facility fee of $1,000 per bedroom must be imposed 90.32 against each new residential unit constructed within the 90.33 qualifying area defined in subdivision 2. The fee is payable to 90.34 the commissioner of revenue and shall be due within 60 days from 90.35 the date the construction is substantially completed. 90.36 Subd. 5. [EXEMPTION.] The future school facilities fee 91.1 does not apply to construction projects providing low-or 91.2 moderate-income housing if the need for such housing has been 91.3 identified in the comprehensive plan of the municipality in 91.4 which the residential construction occurs. 91.5 Subd. 6. [REVENUE RESERVED.] Fees collected by the 91.6 commissioner of revenue must be placed in a reserved account. 91.7 The commissioner may recover its costs associated with the 91.8 legal, administrative, and other expenses related to the future 91.9 school facilities fee. The remainder must be placed in trust 91.10 and held for school facility construction projects that occur in 91.11 the attendance areas from which the fees were collected. 91.12 Subd. 7. [DISTRIBUTION OF FEES TO SCHOOL DISTRICTS.] A 91.13 school district that is building a new school facility or making 91.14 capital improvements to a school building that is located within 91.15 the geographic region defined in subdivision 2 shall notify the 91.16 commissioner of revenue of its construction project. The 91.17 commissioner shall transfer any revenue held in trust for a 91.18 school building project in that attendance area in the school 91.19 district to the school district. 91.20 Subd. 8. [REVENUE USES.] Future school facilities fees 91.21 paid by the commissioner to a school district must be used only 91.22 for the costs associated with constructing a new school 91.23 facility, repaying the principal and interest on bonds issued 91.24 for the construction of a school facility, or capital 91.25 improvements to an existing school facility, located within that 91.26 attendance area. 91.27 Subd. 9. [NOTICE; RECORDING.] A future school facility fee 91.28 constitutes a lien upon the property, and must be recorded, and 91.29 a purchaser of real property must be notified of any future 91.30 school facility fees due. 91.31 Sec. 2. [EFFECTIVE DATE.] 91.32 Section 1 is effective July 1, 1997. 91.33 ARTICLE 8 91.34 FISCAL DISPARITIES 91.35 Section 1. Minnesota Statutes 1996, section 276A.04, is 91.36 amended to read: 92.1 276A.04 [INCREASE IN NET TAX CAPACITY.] 92.2 ByJulyAugust 15 of 1997 and each subsequent year, the 92.3 auditor of each county in the area shall determine the amount, 92.4 if any, by which the net tax capacity determinedin the92.5preceding yearpursuant to section 276A.03, of 92.6 commercial-industrial property subject to taxation within each 92.7 municipality in the county exceeds the net tax capacity in 1995 92.8 of commercial-industrial property subject to taxation within 92.9 that municipality. If a municipality is located in two or more 92.10 counties within the area, the auditors of those counties shall 92.11 certify the data required by section 276A.03 to the county 92.12 auditor responsible for allocating the levies of that 92.13 municipality between or among the affected counties. That 92.14 county auditor shall determine the amount of the net excess, if 92.15 any, for the municipality under this section, and certify that 92.16 amount under section 276A.05. The increase in total net tax 92.17 capacity determined by this section must be reduced by the 92.18 amount of any decreases in the net tax capacity of 92.19 commercial-industrial property resulting from any court 92.20 decisions, court-related stipulation agreements, or abatements 92.21 for a prior year, and only in the amount of such decreases made 92.22 during the 12-month period ending on May 1 of the current 92.23 assessment year, where the decreases, if originally reflected in 92.24 the determination of a prior year's net tax capacity under 92.25 section 276A.03, would have resulted in a smaller contribution 92.26 from the municipality in that year. An adjustment for the 92.27 decreases shall be made only if the municipality made a 92.28 contribution in a prior year based on the higher net tax 92.29 capacity of the commercial-industrial property. 92.30 Sec. 2. Minnesota Statutes 1996, section 276A.05, 92.31 subdivision 1, is amended to read: 92.32 Subdivision 1. [AREAWIDE NET TAX CAPACITY.] Each county 92.33 auditor shall certify the determinations under sections 276A.03 92.34 and 276A.04 to the administrative auditor on or before August192.35 15 of each year. The administrative auditor shall determine an 92.36 amount equal to 40 percent of the sum of the amounts certified 93.1 pursuant to section 276A.04. The resulting amount shall be 93.2 known as the "areawide net tax capacity for ........(year)." 93.3 Sec. 3. Minnesota Statutes 1996, section 276A.05, 93.4 subdivision 5, is amended to read: 93.5 Subd. 5. [CERTIFICATION.] The product of the procedure 93.6 prescribed by subdivision 4 shall be known as the "areawide net 93.7 tax capacity for ......(year) attributable to 93.8 ..........(municipality)." The administrative auditor shall 93.9 certify the product to the auditor of the county in which the 93.10 municipality is located on or beforeAugustSeptember 15. 93.11 Sec. 4. Minnesota Statutes 1996, section 276A.06, 93.12 subdivision 2, is amended to read: 93.13 Subd. 2. [DEFINITION.] The net tax capacity of a 93.14 governmental unit is its net tax capacity as determined in 93.15 accordance with other provisions of law including section 93.16 469.177, subdivision 3, subject to the following adjustments: 93.17 (a) There must be subtracted from its net tax capacity, in 93.18 each municipality in which the governmental unit exercises ad 93.19 valorem taxing jurisdiction, an amount that bears the same 93.20 proportion to 40 percent of the amount certified in that year 93.21 pursuant to sections 276A.04 and 276A.05 for the municipality as 93.22 the totalpreceding year'snet tax capacity of 93.23 commercial-industrial property which is subject to the taxing 93.24 jurisdiction of the governmental unit within the municipality, 93.25 determined without regard to section 469.177, subdivision 3, 93.26 bears to the totalpreceding year'snet tax capacity of 93.27 commercial-industrial property within the municipality, 93.28 determined without regard to section 469.177, subdivision 3. 93.29 (b) There must be added to its net tax capacity, in each 93.30 municipality in which the governmental unit exercises ad valorem 93.31 taxing jurisdiction, an amount which bears the same proportion 93.32 to the areawide net tax capacity for the year attributable to 93.33 that municipality as the totalpreceding year'snet tax capacity 93.34 of residential property which is subject to the taxing 93.35 jurisdiction of the governmental unit within the municipality 93.36 bears to the totalpreceding year'snet tax capacity of 94.1 residential property of the municipality. 94.2 Sec. 5. Minnesota Statutes 1996, section 276A.06, 94.3 subdivision 3, is amended to read: 94.4 Subd. 3. [APPORTIONMENT OF LEVY.] The county auditor shall 94.5 apportion the levy of each governmental unit in the county in 94.6 the manner prescribed by this subdivision. The auditor shall: 94.7 (a)by August 20 of 1997 and each subsequent year,94.8 determine the areawide portion of the levy for each governmental 94.9 unit by multiplying the local tax rate of the governmental unit 94.10 for theprecedingcurrent levy year times the distribution value 94.11 set forth in subdivision 2, clause (b); and 94.12 (b)by September 5 of 1997 and each subsequent year,94.13 determine the local portion of the current year's levy by 94.14 subtracting the resulting amount from clause (a) from the 94.15 governmental unit's current year's levy. 94.16 Sec. 6. Minnesota Statutes 1996, section 276A.06, 94.17 subdivision 5, is amended to read: 94.18 Subd. 5. [AREAWIDE TAX RATE.] (a) On or beforeAugust 2594.19 February 5 of1997 andeachsubsequentyear, the county auditor 94.20 shall certify to the administrative auditor that portion of the 94.21 levy of each governmental unit determined pursuant to 94.22 subdivision 3, clause (a). The administrative auditor shall 94.23 then determine the areawide tax rate sufficient to yield an 94.24 amount equal to the sum of the levies from the areawide net tax 94.25 capacity. 94.26 (b) On or beforeSeptember 1February 10 of each year, the 94.27 administrative auditor shall certify the areawide tax rate to 94.28 each of the county auditors. 94.29 For the purposes of the notice required under section 94.30 275.065, the deadline for the certification under paragraph (a) 94.31 is October 10, and the deadline for certification under 94.32 paragraph (b) is October 15. 94.33 For any governmental unit for which the county auditor has 94.34 not yet determined the local tax rate by January 31, the county 94.35 auditor shall determine the areawide portion of the levy based 94.36 on an estimated tax rate. In the following year, the 95.1 distribution levy of the unit must be adjusted to correct for 95.2 the difference between the distribution levy actually received 95.3 and the distribution levy that would have been received if the 95.4 actual tax rate had been used. 95.5 Sec. 7. Minnesota Statutes 1996, section 473F.06, is 95.6 amended to read: 95.7 473F.06 [INCREASE IN NET TAX CAPACITY.] 95.8 On or beforeJulyAugust 15 of each year, the auditor of 95.9 each county in the area shall determine the amount, if any, by 95.10 which the net tax capacity determinedin the preceding year95.11 under section 473F.05, of commercial-industrial property subject 95.12 to taxation within each municipality in the auditor's county 95.13 exceeds the net tax capacity in 1971 of commercial-industrial 95.14 property subject to taxation within that municipality. If a 95.15 municipality is located in two or more counties within the area, 95.16 the auditors of those counties shall certify the data required 95.17 by section 473F.05 to the county auditor who is responsible 95.18 under other provisions of law for allocating the levies of that 95.19 municipality between or among the affected counties. That 95.20 county auditor shall determine the amount of the net excess, if 95.21 any, for the municipality under this section, and certify that 95.22 amount under section 473F.07. Notwithstanding any other 95.23 provision of sections 473F.01 to 473F.13 to the contrary, in the 95.24 case of a municipality which is designated on July 24, 1971, as 95.25 a redevelopment area under section 401(a)(4) of the Public Works 95.26 and Economic Development Act of 1965, Public Law Number 89-136, 95.27 the increase in its net tax capacity of commercial-industrial 95.28 property for purposes of this section shall be determined in 95.29 each year by using as a base the net tax capacity of 95.30 commercial-industrial property in that municipality in the 1989 95.31 assessment year, rather than the net tax capacity of such 95.32 property in 1971. The increase in total net tax capacity 95.33 determined by this section shall be reduced by the amount of any 95.34 decreases in net tax capacity of commercial-industrial property 95.35 resulting from any court decisions, court related stipulation 95.36 agreements, or abatements for a prior year, and only in the 96.1 amount of such decreases made during the 12-month period ending 96.2 on May 1 of the current assessment year, where such decreases, 96.3 if originally reflected in the determination of a prior year's 96.4 net tax capacity under section 473F.05, would have resulted in a 96.5 smaller contribution from the municipality in that year. An 96.6 adjustment for such decreases shall be made only if the 96.7 municipality made a contribution in a prior year based on the 96.8 higher net tax capacity of the commercial-industrial property. 96.9 Sec. 8. Minnesota Statutes 1996, section 473F.07, 96.10 subdivision 1, is amended to read: 96.11 Subdivision 1. [AREAWIDE NET TAX CAPACITY.] Each county 96.12 auditor shall certify the determinations under sections 473F.05 96.13 and 473F.06 to the administrative auditor on or before August196.14 15 of each year. 96.15 The administrative auditor shall determine an amount equal 96.16 to 40 percent of the sum of the amounts certified under section 96.17 473F.06. The resulting amount shall be known as the "areawide 96.18 net tax capacity for ........(year)." 96.19 Sec. 9. Minnesota Statutes 1996, section 473F.07, 96.20 subdivision 5, is amended to read: 96.21 Subd. 5. [CERTIFICATION TO COUNTY AUDITOR.] The result of 96.22 the procedure prescribed by subdivision 4 shall be known as the 96.23 "areawide net tax capacity for ........(year) attributable to 96.24 ..................(municipality)." The administrative auditor 96.25 shall certify such product to the auditor of the county in which 96.26 the municipality is located on or beforeAugustSeptember 15. 96.27 Sec. 10. Minnesota Statutes 1996, section 473F.08, 96.28 subdivision 2, is amended to read: 96.29 Subd. 2. [COMPUTATION OF NET TAX CAPACITY.] The net tax 96.30 capacity of a governmental unit is its net tax capacity, as 96.31 determined in accordance with other provisions of law including 96.32 section 469.177, subdivision 3, subject to the following 96.33 adjustments: 96.34 (a) There shall be subtracted from its net tax capacity, in 96.35 each municipality in which the governmental unit exercises ad 96.36 valorem taxing jurisdiction, an amount which bears the same 97.1 proportion to 40 percent of the amount certified in that year 97.2 under sections 473F.06 and 473F.07 for the municipality as the 97.3 totalpreceding year'snet tax capacity of commercial-industrial 97.4 property which is subject to the taxing jurisdiction of the 97.5 governmental unit within the municipality, determined without 97.6 regard to section 469.177, subdivision 3, bears to the total 97.7preceding year'snet tax capacity of commercial-industrial 97.8 property within the municipality, determined without regard to 97.9 section 469.177, subdivision 3; 97.10 (b) There shall be added to its net tax capacity, in each 97.11 municipality in which the governmental unit exercises ad valorem 97.12 taxing jurisdiction, an amount which bears the same proportion 97.13 to the areawide net tax capacity for the year attributable to 97.14 that municipality as the totalpreceding year'snet tax capacity 97.15 of residential property which is subject to the taxing 97.16 jurisdiction of the governmental unit within the municipality 97.17 bears to the totalpreceding year'snet tax capacity of 97.18 residential property of the municipality. 97.19 Sec. 11. Minnesota Statutes 1996, section 473F.08, 97.20 subdivision 3, is amended to read: 97.21 Subd. 3. [APPORTIONMENT OF LEVY.] The county auditor shall 97.22 apportion the levy of each governmental unit in the auditor's 97.23 county in the manner prescribed by this subdivision. The 97.24 auditor shall: 97.25 (a)by August 20,determine the areawide portion of the 97.26 levy for each governmental unit by multiplying the local tax 97.27 rate of the governmental unit for theprecedingcurrent levy 97.28 year times the distribution value set forth in subdivision 2, 97.29 clause (b); and 97.30 (b)by September 5,determine the local portion of the 97.31 current year's levy by subtracting the resulting amount from 97.32 clause (a) from the governmental unit's current year's levy. 97.33 Sec. 12. Minnesota Statutes 1996, section 473F.08, 97.34 subdivision 5, is amended to read: 97.35 Subd. 5. [AREAWIDE TAX RATE.] (a) On or beforeAugust 2597.36 February 5 of each year, the county auditor shall certify to the 98.1 administrative auditor that portion of the levy of each 98.2 governmental unit determined under subdivisions 3, clause (a), 98.3 3a, and 3b. The administrative auditor shall then determine the 98.4 areawide tax rate sufficient to yield an amount equal to the sum 98.5 of such levies from the areawide net tax capacity. 98.6 (b) On or beforeSeptember 1February 10 of each year, the 98.7 administrative auditor shall certify the areawide tax rate to 98.8 each of the county auditors. 98.9 For the purposes of the notice required under section 98.10 275.065, the deadline for the certification under paragraph (a) 98.11 is October 10, and the deadline for certification under 98.12 paragraph (b) is October 15. 98.13 For any governmental unit for which the county auditor has 98.14 not yet determined the local tax rate by January 31, the county 98.15 auditor shall determine the areawide portion of the levy based 98.16 on an estimated tax rate. In the following year, the 98.17 distribution levy of the unit must be adjusted to correct for 98.18 the difference between the distribution levy actually received 98.19 and the distribution levy that would have been received if the 98.20 actual tax rate had been used. 98.21 Sec. 13. [REPEALER.] 98.22 Minnesota Statutes 1996, sections 276A.06, subdivision 9; 98.23 and 473F.08, subdivision 8a, are repealed. 98.24 Sec. 14. [EFFECTIVE DATE.] 98.25 Sections 1 to 13 are effective for taxes payable in 1999 98.26 and subsequent years.