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Capital IconMinnesota Legislature

SF 2136

1st Engrossment - 87th Legislature (2011 - 2012) Posted on 05/30/2012 09:43am

KEY: stricken = removed, old language.
underscored = added, new language.
Line numbers 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 1.10 1.11 1.12 1.13 1.14 1.15 1.16 1.17 1.18 1.19 1.20 1.21 1.22 1.23 1.24 1.25 1.26 1.27 1.28 1.29 1.30 1.31 1.32 1.33 1.34 1.35 1.36 1.37 1.38 1.39 2.1 2.2 2.3 2.4 2.5 2.6 2.7 2.8 2.9 2.10 2.11 2.12 2.13 2.14 2.15 2.16 2.17 2.18 2.19 2.20 2.21 2.22 2.23 2.24 2.25 2.26 2.27
2.28 2.29 2.30
2.31 2.32 2.33 2.34 2.35 2.36 2.37 2.38 2.39
2.40
2.41 2.42 2.43 3.1 3.2 3.3 3.4 3.5 3.6 3.7
3.8
3.9 3.10 3.11 3.12 3.13 3.14 3.15 3.16
3.17
3.18 3.19 3.20 3.21 3.22 3.23 3.24 3.25 3.26 3.27 3.28 3.29 3.30 3.31 3.32 3.33 4.1 4.2 4.3 4.4 4.5 4.6 4.7 4.8 4.9 4.10 4.11 4.12 4.13 4.14 4.15 4.16 4.17 4.18 4.19 4.20 4.21 4.22 4.23 4.24 4.25 4.26 4.27 4.28 4.29 4.30 4.31 4.32 4.33 4.34 4.35 4.36 4.37 5.1 5.2 5.3 5.4 5.5 5.6 5.7 5.8 5.9 5.10 5.11 5.12 5.13 5.14 5.15 5.16 5.17 5.18 5.19 5.20 5.21 5.22
5.23
5.24 5.25 5.26 5.27 5.28
5.29
5.30 5.31 5.32 5.33 6.1 6.2 6.3 6.4 6.5 6.6 6.7 6.8 6.9 6.10 6.11 6.12 6.13
6.14
6.15 6.16 6.17 6.18 6.19 6.20 6.21 6.22 6.23 6.24
6.25
6.26 6.27 6.28 6.29 6.30 6.31 6.32 6.33 7.1 7.2 7.3 7.4 7.5 7.6 7.7 7.8 7.9 7.10 7.11 7.12 7.13 7.14 7.15 7.16 7.17 7.18 7.19 7.20
7.21
7.22 7.23 7.24 7.25 7.26 7.27 7.28 7.29 7.30 7.31 7.32 7.33
7.34
8.1 8.2 8.3 8.4 8.5 8.6 8.7
8.8
8.9 8.10 8.11 8.12 8.13 8.14 8.15 8.16 8.17 8.18 8.19 8.20 8.21 8.22 8.23 8.24
8.25 8.26
8.27 8.28 8.29 8.30 8.31 8.32 8.33 9.1 9.2 9.3 9.4 9.5 9.6 9.7 9.8 9.9 9.10 9.11 9.12 9.13 9.14 9.15 9.16 9.17 9.18 9.19 9.20 9.21 9.22 9.23 9.24 9.25 9.26 9.27 9.28 9.29 9.30 9.31 9.32 9.33 9.34 9.35 9.36 10.1 10.2 10.3 10.4 10.5 10.6 10.7 10.8 10.9 10.10 10.11 10.12 10.13 10.14 10.15 10.16 10.17 10.18 10.19 10.20 10.21 10.22 10.23 10.24 10.25 10.26 10.27 10.28 10.29 10.30 10.31 10.32 10.33 10.34 10.35 10.36 11.1 11.2 11.3 11.4 11.5 11.6 11.7 11.8 11.9 11.10 11.11 11.12 11.13 11.14 11.15 11.16 11.17 11.18 11.19 11.20 11.21 11.22 11.23 11.24 11.25 11.26 11.27 11.28 11.29
11.30 11.31
11.32 11.33 11.34 11.35 12.1 12.2 12.3 12.4 12.5 12.6 12.7 12.8 12.9 12.10 12.11 12.12 12.13 12.14 12.15 12.16 12.17 12.18 12.19 12.20 12.21 12.22 12.23 12.24 12.25 12.26 12.27 12.28 12.29 12.30 12.31 12.32 12.33 12.34 13.1 13.2 13.3 13.4 13.5 13.6 13.7 13.8 13.9 13.10 13.11 13.12 13.13 13.14 13.15 13.16 13.17 13.18 13.19 13.20 13.21 13.22 13.23 13.24 13.25 13.26 13.27 13.28 13.29 13.30 13.31 13.32 13.33 13.34 13.35 14.1 14.2 14.3 14.4 14.5 14.6 14.7 14.8 14.9 14.10 14.11 14.12 14.13 14.14 14.15 14.16 14.17 14.18 14.19 14.20 14.21 14.22 14.23 14.24 14.25 14.26 14.27 14.28 14.29 14.30 14.31 14.32 14.33 14.34 15.1 15.2 15.3 15.4 15.5 15.6 15.7 15.8 15.9 15.10
15.11 15.12
15.13 15.14 15.15 15.16 15.17 15.18 15.19 15.20 15.21 15.22 15.23 15.24 15.25 15.26 15.27 15.28 15.29 15.30 15.31 15.32 15.33 15.34 15.35 16.1 16.2 16.3 16.4 16.5 16.6 16.7 16.8 16.9 16.10 16.11 16.12 16.13 16.14 16.15 16.16 16.17 16.18 16.19 16.20 16.21 16.22 16.23 16.24 16.25 16.26 16.27 16.28 16.29 16.30 16.31 16.32 16.33 16.34 16.35 17.1 17.2 17.3 17.4 17.5 17.6 17.7 17.8 17.9 17.10 17.11 17.12 17.13 17.14 17.15 17.16 17.17 17.18 17.19 17.20 17.21 17.22 17.23 17.24 17.25 17.26 17.27 17.28 17.29 17.30 17.31 17.32 17.33 17.34 17.35 17.36 18.1 18.2
18.3 18.4
18.5 18.6 18.7 18.8 18.9 18.10 18.11 18.12 18.13 18.14 18.15 18.16 18.17 18.18 18.19 18.20 18.21 18.22 18.23 18.24 18.25 18.26 18.27 18.28 18.29 18.30 18.31 18.32 18.33 18.34 18.35 19.1 19.2 19.3 19.4 19.5 19.6 19.7 19.8 19.9 19.10 19.11 19.12 19.13 19.14 19.15 19.16 19.17 19.18 19.19 19.20 19.21 19.22 19.23 19.24 19.25 19.26 19.27 19.28 19.29 19.30 19.31 19.32 19.33 19.34 19.35 19.36
20.1 20.2
20.3 20.4 20.5 20.6 20.7 20.8 20.9 20.10 20.11 20.12 20.13 20.14 20.15 20.16 20.17 20.18 20.19 20.20 20.21 20.22 20.23 20.24
20.25
20.26 20.27 20.28 20.29 20.30 20.31 20.32 20.33 21.1 21.2 21.3 21.4 21.5 21.6 21.7 21.8 21.9 21.10 21.11 21.12 21.13 21.14 21.15 21.16 21.17 21.18 21.19 21.20 21.21 21.22 21.23 21.24 21.25 21.26 21.27 21.28 21.29 21.30 21.31 21.32 21.33 21.34 21.35 22.1 22.2 22.3 22.4 22.5 22.6 22.7 22.8 22.9 22.10 22.11 22.12 22.13 22.14 22.15 22.16 22.17 22.18 22.19 22.20 22.21 22.22 22.23 22.24 22.25 22.26 22.27 22.28 22.29 22.30 22.31 22.32 22.33 22.34 23.1 23.2 23.3 23.4 23.5 23.6 23.7
23.8
23.9 23.10
23.11 23.12 23.13 23.14 23.15 23.16
23.17 23.18
23.19 23.20 23.21 23.22 23.23 23.24
23.25 23.26
23.27 23.28 23.29 23.30 23.31
24.1 24.2
24.3 24.4 24.5 24.6
24.7 24.8
24.9 24.10 24.11 24.12 24.13
24.14 24.15
24.16 24.17 24.18 24.19 24.20 24.21 24.22 24.23 24.24 24.25 24.26 24.27
24.28 24.29
24.30 24.31 25.1 25.2 25.3 25.4 25.5 25.6 25.7 25.8 25.9 25.10 25.11 25.12 25.13 25.14 25.15 25.16 25.17 25.18 25.19 25.20 25.21 25.22 25.23 25.24 25.25 25.26 25.27 25.28 25.29 25.30 25.31 25.32 25.33 25.34 25.35 26.1 26.2 26.3 26.4 26.5 26.6 26.7 26.8 26.9 26.10 26.11 26.12 26.13 26.14 26.15 26.16 26.17 26.18
26.19 26.20
26.21 26.22 26.23 26.24 26.25 26.26 26.27 26.28 26.29 26.30 26.31 26.32 26.33 26.34 27.1 27.2 27.3 27.4 27.5 27.6 27.7 27.8 27.9 27.10 27.11 27.12 27.13
27.14 27.15
27.16 27.17 27.18 27.19 27.20 27.21 27.22 27.23 27.24 27.25 27.26 27.27 27.28 27.29 27.30
27.31 27.32
28.1 28.2
28.3 28.4 28.5 28.6 28.7
28.8
28.9 28.10 28.11 28.12
28.13 28.14
28.15 28.16 28.17 28.18 28.19 28.20 28.21 28.22 28.23 28.24 28.25 28.26 28.27 28.28 28.29 28.30 28.31
29.1
29.2 29.3 29.4 29.5 29.6 29.7 29.8 29.9 29.10 29.11 29.12 29.13 29.14 29.15 29.16 29.17 29.18 29.19
29.20
29.21 29.22 29.23 29.24 29.25 29.26 29.27 29.28 29.29 29.30 29.31 29.32 29.33 29.34 30.1 30.2 30.3 30.4 30.5 30.6 30.7 30.8 30.9 30.10 30.11 30.12 30.13 30.14 30.15 30.16 30.17 30.18 30.19 30.20 30.21 30.22 30.23 30.24 30.25 30.26 30.27 30.28 30.29 30.30 30.31 30.32 30.33 30.34
30.35
31.1 31.2 31.3
31.4
31.5 31.6 31.7 31.8 31.9 31.10 31.11 31.12 31.13 31.14 31.15 31.16 31.17 31.18 31.19 31.20 31.21 31.22 31.23 31.24 31.25 31.26 31.27 31.28 31.29 31.30 31.31 31.32 31.33 31.34 31.35
32.1
32.2 32.3 32.4 32.5 32.6 32.7 32.8 32.9 32.10 32.11 32.12 32.13 32.14 32.15 32.16 32.17 32.18 32.19 32.20 32.21 32.22 32.23 32.24 32.25 32.26 32.27 32.28 32.29 32.30 32.31 32.32 32.33 32.34 32.35 33.1 33.2 33.3 33.4 33.5 33.6 33.7 33.8 33.9 33.10 33.11 33.12 33.13 33.14 33.15 33.16 33.17 33.18 33.19 33.20 33.21 33.22 33.23 33.24 33.25 33.26 33.27 33.28 33.29 33.30 33.31 33.32 33.33 33.34 33.35 33.36 34.1 34.2 34.3 34.4 34.5 34.6 34.7 34.8 34.9 34.10 34.11 34.12 34.13 34.14 34.15 34.16 34.17 34.18 34.19 34.20 34.21 34.22 34.23 34.24 34.25 34.26 34.27 34.28 34.29 34.30 34.31 34.32 34.33 34.34 34.35 35.1 35.2 35.3 35.4 35.5 35.6 35.7 35.8 35.9 35.10 35.11 35.12 35.13 35.14 35.15 35.16 35.17 35.18 35.19 35.20 35.21 35.22 35.23 35.24 35.25 35.26 35.27 35.28 35.29 35.30 35.31 35.32 35.33 35.34 35.35 36.1 36.2 36.3 36.4 36.5 36.6 36.7 36.8 36.9 36.10 36.11 36.12 36.13 36.14 36.15 36.16 36.17 36.18 36.19 36.20 36.21 36.22 36.23 36.24 36.25 36.26 36.27 36.28 36.29
36.30
36.31 36.32 36.33 36.34 36.35 37.1 37.2 37.3 37.4 37.5 37.6 37.7 37.8 37.9 37.10 37.11 37.12 37.13 37.14 37.15 37.16 37.17 37.18 37.19 37.20 37.21 37.22 37.23 37.24 37.25 37.26 37.27 37.28 37.29 37.30 37.31 37.32 37.33 37.34 37.35 37.36 38.1 38.2 38.3 38.4 38.5 38.6 38.7 38.8 38.9 38.10 38.11 38.12 38.13 38.14 38.15 38.16 38.17 38.18 38.19 38.20 38.21 38.22 38.23 38.24 38.25 38.26 38.27 38.28 38.29 38.30 38.31 38.32 38.33 38.34 39.1 39.2 39.3 39.4 39.5 39.6 39.7 39.8 39.9 39.10 39.11 39.12 39.13 39.14 39.15 39.16 39.17 39.18 39.19 39.20 39.21 39.22 39.23 39.24 39.25 39.26 39.27 39.28 39.29 39.30 39.31 39.32 39.33 39.34 39.35 40.1 40.2 40.3 40.4 40.5 40.6 40.7 40.8 40.9 40.10 40.11 40.12 40.13 40.14 40.15 40.16 40.17 40.18 40.19 40.20 40.21 40.22 40.23 40.24 40.25 40.26 40.27 40.28 40.29 40.30 40.31 40.32 40.33 40.34 40.35 40.36 41.1 41.2 41.3 41.4 41.5 41.6 41.7 41.8 41.9 41.10 41.11 41.12 41.13 41.14 41.15 41.16 41.17 41.18 41.19 41.20 41.21 41.22 41.23 41.24 41.25 41.26 41.27 41.28 41.29 41.30 41.31 41.32 41.33 41.34 41.35 42.1 42.2 42.3 42.4 42.5 42.6 42.7 42.8 42.9 42.10 42.11 42.12 42.13 42.14 42.15 42.16 42.17
42.18
42.19 42.20 42.21 42.22 42.23 42.24 42.25 42.26 42.27 42.28 42.29 42.30 42.31 42.32 42.33 42.34 42.35 43.1 43.2 43.3 43.4 43.5 43.6 43.7 43.8 43.9 43.10 43.11 43.12 43.13 43.14 43.15 43.16 43.17 43.18 43.19 43.20 43.21 43.22 43.23 43.24 43.25 43.26 43.27 43.28 43.29 43.30 43.31 43.32 43.33 43.34 43.35 43.36 44.1 44.2 44.3 44.4 44.5 44.6 44.7 44.8 44.9 44.10 44.11 44.12 44.13 44.14 44.15 44.16 44.17 44.18 44.19 44.20 44.21 44.22 44.23 44.24 44.25 44.26 44.27 44.28 44.29 44.30 44.31 44.32 44.33 44.34 44.35 44.36 45.1 45.2 45.3 45.4 45.5 45.6 45.7 45.8 45.9 45.10 45.11 45.12 45.13 45.14 45.15 45.16 45.17 45.18 45.19 45.20 45.21 45.22 45.23 45.24 45.25 45.26 45.27 45.28 45.29 45.30 45.31 45.32 45.33 45.34 45.35 45.36 46.1 46.2 46.3 46.4 46.5 46.6 46.7 46.8 46.9 46.10 46.11 46.12 46.13 46.14 46.15 46.16 46.17 46.18 46.19 46.20 46.21 46.22 46.23 46.24 46.25 46.26 46.27 46.28 46.29 46.30 46.31 46.32 46.33 46.34 46.35 46.36 47.1 47.2 47.3 47.4 47.5 47.6 47.7 47.8 47.9 47.10 47.11 47.12 47.13 47.14 47.15 47.16 47.17 47.18 47.19 47.20 47.21 47.22 47.23 47.24 47.25 47.26 47.27 47.28 47.29 47.30 47.31 47.32 47.33 47.34 47.35 47.36 48.1 48.2 48.3 48.4
48.5 48.6
48.7 48.8 48.9 48.10 48.11 48.12 48.13 48.14 48.15 48.16 48.17 48.18 48.19 48.20 48.21 48.22 48.23 48.24 48.25 48.26 48.27 48.28
48.29
48.30 48.31 48.32 48.33 49.1 49.2 49.3 49.4 49.5 49.6 49.7 49.8 49.9 49.10 49.11 49.12 49.13 49.14 49.15 49.16
49.17
49.18 49.19 49.20 49.21 49.22 49.23 49.24 49.25 49.26 49.27 49.28
49.29
49.30 49.31 49.32 50.1 50.2 50.3 50.4 50.5 50.6 50.7 50.8 50.9 50.10 50.11 50.12 50.13 50.14 50.15 50.16 50.17 50.18 50.19 50.20 50.21 50.22 50.23 50.24
50.25
50.26 50.27 50.28 50.29 50.30 50.31
50.32
50.33 51.1 51.2 51.3 51.4 51.5 51.6 51.7 51.8 51.9 51.10 51.11 51.12 51.13 51.14 51.15 51.16 51.17 51.18 51.19 51.20 51.21 51.22 51.23 51.24 51.25 51.26 51.27 51.28 51.29 51.30 51.31 51.32 51.33 51.34 51.35 51.36 51.37 52.1 52.2 52.3 52.4 52.5 52.6 52.7 52.8 52.9 52.10 52.11 52.12 52.13 52.14 52.15 52.16 52.17 52.18 52.19 52.20 52.21 52.22 52.23 52.24 52.25 52.26 52.27 52.28 52.29 52.30 52.31 52.32 52.33 52.34 52.35 52.36 52.37 52.38 52.39 52.40 52.41 52.42 52.43 52.44 52.45 52.46 53.1 53.2 53.3 53.4 53.5 53.6 53.7 53.8 53.9 53.10 53.11 53.12 53.13 53.14 53.15 53.16 53.17 53.18 53.19 53.20 53.21 53.22 53.23 53.24 53.25
53.26 53.27
53.28 53.29 53.30 53.31 53.32 53.33 53.34 53.35 53.36 53.37 53.38 53.39 54.1 54.2 54.3 54.4 54.5 54.6 54.7 54.8 54.9 54.10 54.11 54.12 54.13 54.14 54.15 54.16 54.17 54.18 54.19 54.20 54.21 54.22 54.23 54.24 54.25 54.26 54.27 54.28 54.29 54.30
54.31
54.32 54.33 54.34 54.35 55.1 55.2 55.3 55.4 55.5 55.6 55.7 55.8 55.9 55.10
55.11 55.12
55.13 55.14 55.15 55.16 55.17 55.18 55.19 55.20 55.21 55.22 55.23 55.24 55.25 55.26 55.27 55.28 55.29 55.30 55.31 55.32 55.33 55.34 55.35 56.1 56.2 56.3 56.4 56.5 56.6 56.7 56.8 56.9 56.10 56.11 56.12 56.13 56.14 56.15 56.16 56.17 56.18 56.19 56.20 56.21 56.22 56.23 56.24 56.25 56.26 56.27 56.28 56.29 56.30 56.31 56.32 56.33 56.34 56.35 57.1 57.2 57.3 57.4 57.5 57.6 57.7 57.8 57.9 57.10 57.11 57.12 57.13 57.14 57.15 57.16 57.17 57.18 57.19 57.20 57.21 57.22 57.23 57.24 57.25 57.26
57.27
57.28 57.29 57.30
57.31 57.32
58.1 58.2 58.3
58.4 58.5 58.6 58.7 58.8 58.9 58.10 58.11 58.12 58.13 58.14 58.15 58.16 58.17 58.18 58.19 58.20 58.21 58.22 58.23 58.24 58.25 58.26 58.27 58.28 58.29 58.30 58.31 58.32 58.33 58.34 58.35 59.1 59.2 59.3 59.4 59.5 59.6 59.7 59.8 59.9 59.10 59.11 59.12 59.13 59.14 59.15 59.16
59.17 59.18
59.19 59.20 59.21 59.22 59.23 59.24
59.25
59.26 59.27 59.28 59.29 59.30 59.31 59.32 60.1 60.2 60.3 60.4 60.5 60.6 60.7 60.8 60.9 60.10 60.11 60.12 60.13 60.14 60.15 60.16 60.17 60.18 60.19 60.20 60.21 60.22 60.23 60.24 60.25 60.26 60.27 60.28 60.29 60.30 60.31 60.32 60.33 60.34 60.35 61.1 61.2
61.3
61.4 61.5 61.6 61.7 61.8 61.9 61.10 61.11 61.12
61.13 61.14
61.15 61.16 61.17 61.18 61.19 61.20 61.21 61.22 61.23 61.24 61.25 61.26 61.27 61.28 61.29 61.30 61.31
61.32 61.33
62.1 62.2 62.3 62.4 62.5 62.6 62.7 62.8 62.9 62.10 62.11 62.12 62.13 62.14
62.15 62.16
62.17 62.18 62.19 62.20 62.21 62.22 62.23 62.24 62.25 62.26 62.27 62.28 62.29 62.30 62.31 62.32 62.33 62.34 63.1 63.2 63.3 63.4 63.5 63.6 63.7 63.8 63.9 63.10 63.11 63.12 63.13 63.14
63.15
63.16 63.17 63.18 63.19 63.20 63.21 63.22 63.23 63.24 63.25 63.26 63.27 63.28 63.29 63.30 63.31 63.32 63.33 63.34 64.1 64.2 64.3 64.4 64.5 64.6 64.7 64.8
64.9 64.10
64.11 64.12 64.13 64.14 64.15 64.16 64.17 64.18 64.19 64.20 64.21 64.22 64.23 64.24 64.25 64.26 64.27 64.28 64.29 64.30 64.31 64.32 64.33 65.1 65.2 65.3 65.4 65.5 65.6
65.7 65.8
65.9 65.10 65.11 65.12 65.13 65.14
65.15 65.16
65.17 65.18 65.19 65.20 65.21 65.22 65.23 65.24
65.25 65.26
65.27 65.28 65.29 65.30 65.31 66.1 66.2
66.3 66.4
66.5 66.6 66.7
66.8
66.9 66.10 66.11
66.12
66.13 66.14 66.15 66.16 66.17 66.18 66.19 66.20 66.21 66.22 66.23 66.24 66.25 66.26 66.27 66.28 66.29 66.30 66.31 66.32 67.1 67.2 67.3 67.4 67.5 67.6 67.7 67.8 67.9 67.10 67.11 67.12 67.13 67.14 67.15 67.16 67.17 67.18 67.19 67.20 67.21 67.22 67.23 67.24 67.25 67.26 67.27 67.28 67.29 67.30 67.31
67.32
67.33 67.34
68.1 68.2
68.3 68.4
68.5 68.6 68.7 68.8 68.9 68.10 68.11 68.12 68.13 68.14 68.15 68.16 68.17
68.18
68.19 68.20 68.21 68.22 68.23 68.24 68.25 68.26 68.27 68.28 68.29 68.30 68.31 68.32 69.1 69.2 69.3 69.4 69.5 69.6 69.7 69.8 69.9 69.10 69.11 69.12
69.13
69.14 69.15 69.16 69.17 69.18
69.19
69.20 69.21
69.22 69.23 69.24 69.25 69.26 69.27 69.28 69.29 69.30 69.31 69.32 70.1 70.2 70.3 70.4 70.5 70.6 70.7 70.8 70.9
70.10
70.11 70.12 70.13 70.14 70.15 70.16 70.17 70.18 70.19 70.20 70.21 70.22 70.23 70.24
70.25
70.26 70.27 70.28 70.29 70.30 70.31 70.32 70.33 71.1 71.2 71.3 71.4 71.5 71.6
71.7
71.8 71.9 71.10 71.11 71.12 71.13 71.14 71.15 71.16 71.17 71.18 71.19 71.20 71.21 71.22 71.23 71.24 71.25 71.26 71.27 71.28 71.29 71.30 71.31 71.32 71.33 71.34 71.35 72.1 72.2 72.3 72.4 72.5 72.6 72.7 72.8 72.9 72.10 72.11 72.12 72.13 72.14 72.15 72.16 72.17 72.18 72.19 72.20 72.21 72.22 72.23 72.24 72.25
72.26 72.27
72.28 72.29 72.30 72.31
72.32
72.33 73.1 73.2 73.3 73.4 73.5 73.6 73.7
73.8
73.9 73.10 73.11 73.12 73.13 73.14 73.15 73.16 73.17 73.18 73.19 73.20 73.21 73.22 73.23 73.24 73.25 73.26 73.27 73.28 73.29 73.30 73.31 73.32 73.33 73.34 73.35 74.1 74.2 74.3 74.4 74.5 74.6 74.7 74.8 74.9 74.10 74.11 74.12 74.13
74.14
74.15 74.16 74.17 74.18 74.19 74.20 74.21 74.22 74.23 74.24 74.25 74.26 74.27 74.28 74.29 74.30 74.31 74.32 74.33 74.34 75.1 75.2 75.3 75.4 75.5 75.6 75.7 75.8 75.9 75.10 75.11 75.12 75.13 75.14 75.15 75.16 75.17 75.18 75.19 75.20 75.21 75.22 75.23 75.24 75.25 75.26 75.27 75.28 75.29 75.30 75.31 75.32 75.33 75.34
75.35
76.1 76.2 76.3 76.4 76.5 76.6 76.7 76.8
76.9
76.10 76.11 76.12 76.13 76.14 76.15
76.16
76.17 76.18 76.19 76.20 76.21 76.22 76.23 76.24
76.25
76.26 76.27 76.28 76.29 76.30 76.31
77.1
77.2 77.3 77.4 77.5 77.6 77.7 77.8 77.9
77.10
77.11 77.12 77.13 77.14 77.15 77.16 77.17 77.18 77.19 77.20 77.21 77.22 77.23
77.24
77.25 77.26
77.27 77.28 77.29 77.30 77.31 78.1 78.2 78.3 78.4 78.5 78.6 78.7 78.8 78.9 78.10 78.11 78.12 78.13 78.14 78.15 78.16 78.17 78.18 78.19 78.20 78.21
78.22 78.23 78.24 78.25 78.26 78.27 78.28 78.29 78.30 78.31 78.32 78.33 78.34 78.35 79.1 79.2 79.3 79.4 79.5
79.6 79.7 79.8 79.9 79.10 79.11 79.12 79.13 79.14 79.15 79.16
79.17 79.18 79.19 79.20 79.21 79.22 79.23 79.24 79.25 79.26 79.27
79.28 79.29 79.30 79.31
79.32 80.1 80.2 80.3 80.4 80.5 80.6 80.7 80.8 80.9 80.10 80.11 80.12 80.13 80.14 80.15 80.16 80.17 80.18 80.19 80.20 80.21 80.22 80.23 80.24 80.25 80.26 80.27 80.28 80.29 80.30 80.31 80.32 80.33
80.34 81.1 81.2 81.3 81.4 81.5 81.6 81.7 81.8 81.9 81.10 81.11 81.12 81.13 81.14 81.15
81.16 81.17 81.18 81.19 81.20 81.21 81.22 81.23 81.24 81.25 81.26 81.27 81.28 81.29 81.30 81.31 81.32 81.33 81.34 81.35 82.1 82.2 82.3 82.4
82.5 82.6 82.7 82.8 82.9 82.10 82.11 82.12 82.13 82.14 82.15 82.16 82.17 82.18 82.19 82.20 82.21 82.22 82.23 82.24 82.25 82.26 82.27 82.28 82.29 82.30 82.31 82.32 82.33 82.34 83.1 83.2 83.3 83.4 83.5 83.6 83.7 83.8 83.9 83.10 83.11 83.12 83.13 83.14 83.15 83.16 83.17 83.18 83.19 83.20 83.21 83.22 83.23 83.24 83.25 83.26 83.27 83.28 83.29 83.30 83.31 83.32 83.33 83.34 83.35 84.1 84.2 84.3 84.4 84.5 84.6 84.7 84.8 84.9 84.10 84.11 84.12 84.13 84.14 84.15 84.16 84.17 84.18 84.19 84.20 84.21 84.22 84.23 84.24 84.25 84.26 84.27 84.28 84.29 84.30 84.31 84.32 84.33 84.34 84.35 84.36 85.1 85.2 85.3 85.4 85.5 85.6 85.7
85.8 85.9 85.10 85.11 85.12 85.13 85.14 85.15 85.16 85.17 85.18 85.19
85.20 85.21 85.22 85.23 85.24 85.25 85.26 85.27 85.28 85.29 85.30 85.31 85.32 85.33 85.34 86.1 86.2 86.3 86.4 86.5 86.6 86.7 86.8 86.9 86.10 86.11 86.12 86.13 86.14 86.15 86.16 86.17 86.18 86.19 86.20 86.21 86.22 86.23 86.24 86.25 86.26 86.27 86.28 86.29 86.30 86.31 86.32
86.33 86.34 86.35 87.1 87.2 87.3 87.4 87.5 87.6 87.7 87.8 87.9 87.10 87.11 87.12 87.13 87.14 87.15 87.16 87.17 87.18 87.19 87.20 87.21 87.22 87.23 87.24 87.25 87.26 87.27 87.28 87.29 87.30 87.31 87.32 87.33 87.34 87.35 87.36 88.1 88.2 88.3 88.4 88.5 88.6 88.7 88.8 88.9 88.10 88.11 88.12 88.13 88.14 88.15
88.16 88.17 88.18 88.19 88.20 88.21 88.22 88.23 88.24 88.25 88.26 88.27 88.28 88.29 88.30 88.31 88.32 88.33 88.34 88.35 89.1 89.2 89.3 89.4 89.5 89.6 89.7 89.8 89.9 89.10 89.11 89.12 89.13 89.14 89.15 89.16 89.17 89.18 89.19 89.20 89.21 89.22 89.23 89.24 89.25 89.26 89.27 89.28 89.29 89.30 89.31 89.32 89.33 89.34 89.35 90.1 90.2 90.3 90.4 90.5 90.6
90.7 90.8 90.9 90.10 90.11 90.12 90.13 90.14 90.15 90.16 90.17 90.18 90.19 90.20 90.21 90.22 90.23 90.24 90.25 90.26 90.27 90.28 90.29 90.30 90.31 90.32 90.33 90.34 90.35 91.1 91.2 91.3 91.4 91.5 91.6 91.7 91.8 91.9 91.10 91.11 91.12 91.13 91.14 91.15 91.16 91.17 91.18 91.19 91.20 91.21
91.22 91.23 91.24 91.25 91.26 91.27 91.28 91.29 91.30 91.31 91.32 91.33 91.34 91.35 92.1 92.2 92.3 92.4 92.5 92.6 92.7 92.8 92.9 92.10 92.11 92.12 92.13 92.14 92.15 92.16 92.17 92.18 92.19 92.20 92.21 92.22 92.23 92.24 92.25 92.26 92.27 92.28 92.29 92.30 92.31 92.32 92.33 92.34 92.35 92.36 93.1 93.2 93.3 93.4 93.5 93.6 93.7 93.8 93.9 93.10 93.11 93.12 93.13 93.14 93.15 93.16 93.17
93.18 93.19 93.20 93.21 93.22 93.23 93.24 93.25 93.26 93.27 93.28 93.29 93.30 93.31 93.32 93.33 93.34 94.1 94.2 94.3 94.4 94.5 94.6 94.7
94.8 94.9 94.10 94.11 94.12 94.13 94.14 94.15 94.16 94.17 94.18 94.19 94.20 94.21 94.22 94.23 94.24 94.25 94.26 94.27 94.28 94.29 94.30 94.31 94.32 94.33 94.34 95.1 95.2
95.3 95.4 95.5 95.6 95.7 95.8 95.9 95.10 95.11 95.12 95.13 95.14 95.15 95.16 95.17 95.18 95.19 95.20 95.21 95.22 95.23 95.24 95.25 95.26 95.27 95.28 95.29 95.30 95.31 95.32 95.33 95.34 96.1 96.2 96.3 96.4 96.5
96.6 96.7 96.8 96.9 96.10 96.11 96.12 96.13 96.14 96.15 96.16 96.17 96.18 96.19 96.20 96.21 96.22 96.23 96.24 96.25 96.26 96.27 96.28 96.29 96.30 96.31 96.32 96.33 96.34 97.1 97.2 97.3 97.4 97.5 97.6 97.7 97.8 97.9 97.10 97.11 97.12
97.13 97.14 97.15 97.16 97.17 97.18 97.19 97.20 97.21 97.22 97.23 97.24 97.25 97.26 97.27 97.28 97.29 97.30 97.31 97.32 97.33 97.34 97.35 98.1 98.2 98.3 98.4 98.5
98.6 98.7 98.8 98.9
98.10 98.11 98.12 98.13 98.14 98.15
98.16 98.17 98.18 98.19 98.20
98.21 98.22 98.23 98.24 98.25 98.26 98.27
98.28 98.29 98.30 98.31 99.1 99.2 99.3 99.4 99.5 99.6 99.7 99.8 99.9 99.10 99.11 99.12 99.13 99.14 99.15 99.16 99.17
99.18 99.19 99.20 99.21 99.22 99.23 99.24 99.25 99.26 99.27 99.28 99.29 99.30 99.31 99.32
99.33 100.1 100.2 100.3 100.4 100.5 100.6 100.7 100.8 100.9 100.10 100.11 100.12 100.13 100.14 100.15 100.16 100.17 100.18
100.19 100.20 100.21 100.22 100.23 100.24 100.25 100.26 100.27 100.28 100.29
100.30 100.31 100.32 100.33 100.34 101.1 101.2 101.3 101.4 101.5 101.6 101.7 101.8 101.9 101.10
101.11 101.12 101.13 101.14 101.15 101.16 101.17 101.18 101.19 101.20 101.21 101.22 101.23 101.24 101.25 101.26 101.27 101.28
101.29 101.30 101.31 101.32 101.33 101.34 102.1 102.2 102.3 102.4 102.5 102.6 102.7 102.8 102.9 102.10 102.11 102.12 102.13 102.14 102.15 102.16 102.17
102.18 102.19 102.20 102.21 102.22
102.23 102.24 102.25 102.26 102.27 102.28 102.29 102.30 102.31 102.32 102.33 103.1 103.2 103.3 103.4 103.5 103.6 103.7 103.8
103.9 103.10 103.11
103.12 103.13 103.14 103.15 103.16 103.17 103.18 103.19 103.20 103.21 103.22 103.23 103.24
103.25 103.26 103.27 103.28 103.29 103.30 103.31 103.32 103.33 104.1 104.2 104.3 104.4 104.5 104.6 104.7 104.8 104.9 104.10 104.11 104.12 104.13 104.14
104.15 104.16 104.17 104.18 104.19 104.20 104.21 104.22 104.23 104.24 104.25 104.26 104.27 104.28 104.29 104.30 104.31 104.32 104.33 104.34 104.35 105.1 105.2 105.3 105.4 105.5 105.6 105.7 105.8 105.9 105.10 105.11 105.12 105.13 105.14 105.15 105.16 105.17 105.18 105.19 105.20 105.21 105.22 105.23 105.24 105.25 105.26 105.27 105.28 105.29 105.30 105.31 105.32 105.33 105.34 105.35 106.1 106.2 106.3 106.4 106.5 106.6 106.7 106.8 106.9 106.10 106.11 106.12 106.13 106.14 106.15 106.16 106.17 106.18 106.19 106.20 106.21 106.22 106.23 106.24 106.25 106.26 106.27
106.28 106.29 106.30 106.31 106.32 106.33 106.34 107.1 107.2 107.3 107.4 107.5 107.6 107.7 107.8 107.9
107.10 107.11 107.12 107.13 107.14 107.15 107.16 107.17 107.18 107.19 107.20 107.21 107.22 107.23 107.24 107.25 107.26 107.27 107.28 107.29 107.30 107.31 107.32 107.33 107.34 107.35 108.1 108.2 108.3 108.4 108.5 108.6 108.7 108.8 108.9 108.10 108.11 108.12 108.13 108.14 108.15 108.16 108.17 108.18 108.19 108.20 108.21 108.22 108.23 108.24 108.25 108.26 108.27 108.28 108.29 108.30 108.31 108.32 108.33 108.34 108.35 109.1 109.2 109.3 109.4 109.5 109.6 109.7 109.8 109.9 109.10 109.11 109.12 109.13 109.14 109.15
109.16 109.17 109.18 109.19 109.20 109.21 109.22
109.23 109.24 109.25 109.26 109.27 109.28 109.29 109.30 109.31 109.32 109.33 109.34 110.1 110.2 110.3 110.4 110.5 110.6 110.7 110.8 110.9 110.10 110.11 110.12 110.13 110.14 110.15 110.16 110.17 110.18 110.19 110.20 110.21 110.22 110.23 110.24 110.25 110.26 110.27 110.28 110.29 110.30 110.31 110.32 110.33 110.34 111.1 111.2 111.3 111.4 111.5 111.6 111.7 111.8 111.9 111.10 111.11 111.12
111.13 111.14 111.15 111.16 111.17 111.18 111.19 111.20 111.21 111.22 111.23 111.24 111.25 111.26 111.27 111.28 111.29 111.30 111.31 111.32 111.33 111.34 112.1 112.2
112.3 112.4 112.5 112.6 112.7 112.8 112.9 112.10 112.11 112.12
112.13 112.14 112.15 112.16 112.17 112.18 112.19
112.20 112.21
112.22 112.23 112.24 112.25 112.26 112.27 112.28 112.29 112.30 112.31 112.32 112.33 113.1 113.2 113.3 113.4 113.5 113.6 113.7 113.8 113.9 113.10 113.11 113.12 113.13 113.14 113.15 113.16
113.17 113.18 113.19 113.20 113.21 113.22 113.23 113.24 113.25 113.26 113.27 113.28 113.29 113.30 113.31 113.32 113.33 113.34 113.35 114.1 114.2 114.3
114.4 114.5 114.6 114.7 114.8 114.9 114.10 114.11 114.12 114.13 114.14
114.15 114.16 114.17 114.18 114.19 114.20 114.21 114.22 114.23 114.24 114.25 114.26 114.27 114.28 114.29 114.30 114.31 114.32 114.33 114.34 115.1 115.2 115.3 115.4 115.5 115.6 115.7 115.8
115.9 115.10 115.11 115.12 115.13 115.14 115.15 115.16 115.17 115.18 115.19 115.20 115.21 115.22 115.23
115.24 115.25
115.26 115.27 115.28 115.29 115.30 115.31 115.32
116.1 116.2
116.3 116.4 116.5 116.6 116.7 116.8 116.9 116.10 116.11 116.12 116.13 116.14 116.15 116.16 116.17 116.18 116.19 116.20 116.21 116.22 116.23 116.24 116.25 116.26 116.27 116.28 116.29 116.30 116.31 116.32 116.33 116.34 116.35 117.1 117.2 117.3 117.4 117.5 117.6 117.7 117.8 117.9 117.10 117.11 117.12 117.13 117.14 117.15 117.16 117.17 117.18 117.19 117.20 117.21 117.22 117.23 117.24 117.25 117.26 117.27 117.28 117.29 117.30 117.31 117.32 117.33 117.34 117.35 118.1 118.2
118.3 118.4
118.5 118.6 118.7 118.8 118.9 118.10 118.11 118.12 118.13 118.14 118.15 118.16 118.17 118.18 118.19 118.20 118.21 118.22 118.23 118.24 118.25 118.26 118.27 118.28
118.29 118.30 118.31 118.32 118.33 118.34 119.1 119.2 119.3 119.4 119.5 119.6 119.7 119.8 119.9 119.10 119.11 119.12
119.13 119.14 119.15 119.16 119.17 119.18 119.19 119.20 119.21 119.22 119.23 119.24 119.25 119.26 119.27 119.28 119.29 119.30 119.31 119.32 119.33 119.34 119.35 120.1 120.2 120.3 120.4 120.5 120.6 120.7
120.8 120.9 120.10 120.11 120.12 120.13 120.14 120.15 120.16
120.17
120.18 120.19 120.20 120.21 120.22 120.23
120.24 120.25 120.26
120.27 120.28 120.29 120.30 120.31 120.32 121.1 121.2 121.3
121.4 121.5 121.6 121.7
121.8 121.9 121.10 121.11 121.12 121.13 121.14 121.15 121.16 121.17 121.18 121.19 121.20 121.21 121.22 121.23 121.24 121.25 121.26 121.27 121.28
121.29 121.30 121.31
122.1 122.2
122.3 122.4 122.5 122.6 122.7 122.8 122.9 122.10 122.11 122.12 122.13 122.14 122.15 122.16 122.17 122.18
122.19 122.20 122.21
122.22 122.23 122.24 122.25 122.26 122.27 122.28 122.29 122.30
122.31
123.1 123.2 123.3 123.4 123.5 123.6 123.7 123.8 123.9 123.10 123.11 123.12 123.13 123.14 123.15 123.16 123.17 123.18 123.19 123.20 123.21 123.22 123.23 123.24 123.25 123.26 123.27 123.28 123.29 123.30 123.31 123.32 123.33 123.34 123.35 123.36 124.1 124.2 124.3 124.4 124.5 124.6 124.7 124.8 124.9 124.10 124.11 124.12 124.13 124.14 124.15 124.16 124.17 124.18 124.19 124.20 124.21 124.22 124.23 124.24
124.25
124.26 124.27 124.28 124.29 124.30 124.31 124.32 124.33 124.34 125.1 125.2 125.3 125.4 125.5 125.6 125.7 125.8 125.9 125.10 125.11 125.12 125.13 125.14 125.15 125.16 125.17 125.18 125.19 125.20 125.21 125.22 125.23 125.24 125.25 125.26 125.27 125.28 125.29 125.30 125.31 125.32 125.33 125.34
126.1 126.2 126.3
126.4 126.5 126.6 126.7 126.8 126.9 126.10 126.11 126.12 126.13 126.14 126.15 126.16 126.17 126.18 126.19 126.20 126.21 126.22 126.23 126.24 126.25 126.26 126.27 126.28
126.29 126.30 126.31
126.32 126.33 127.1 127.2 127.3 127.4 127.5 127.6 127.7 127.8 127.9
127.10 127.11 127.12
127.13 127.14 127.15 127.16 127.17 127.18 127.19 127.20 127.21 127.22 127.23 127.24 127.25 127.26
127.27 127.28 127.29
127.30 127.31 127.32 127.33 128.1 128.2 128.3 128.4 128.5 128.6 128.7 128.8 128.9 128.10 128.11 128.12 128.13 128.14 128.15 128.16 128.17 128.18 128.19 128.20 128.21 128.22 128.23 128.24
128.25 128.26 128.27
128.28 128.29 128.30 128.31 128.32 128.33 128.34 128.35 129.1 129.2 129.3
129.4
129.5 129.6 129.7
129.8 129.9
129.10 129.11 129.12 129.13 129.14 129.15 129.16 129.17 129.18 129.19 129.20 129.21 129.22 129.23 129.24 129.25 129.26 129.27 129.28 129.29 129.30 129.31 129.32 129.33 130.1 130.2 130.3 130.4 130.5 130.6 130.7 130.8 130.9 130.10 130.11 130.12 130.13 130.14 130.15 130.16 130.17
130.18
130.19 130.20 130.21 130.22 130.23 130.24 130.25 130.26 130.27 130.28 130.29 130.30 130.31 130.32 130.33 130.34 130.35 131.1 131.2 131.3 131.4 131.5 131.6 131.7 131.8
131.9 131.10
131.11 131.12 131.13 131.14 131.15
131.16 131.17
131.18 131.19 131.20 131.21 131.22 131.23 131.24 131.25 131.26 131.27 131.28 131.29 131.30 131.31 131.32 131.33 132.1 132.2 132.3 132.4 132.5 132.6 132.7 132.8 132.9 132.10 132.11 132.12 132.13 132.14 132.15 132.16 132.17 132.18 132.19 132.20 132.21 132.22 132.23 132.24 132.25 132.26 132.27 132.28 132.29 132.30 132.31 132.32 132.33 132.34 132.35 132.36 133.1 133.2 133.3 133.4 133.5 133.6 133.7 133.8 133.9 133.10 133.11 133.12 133.13 133.14 133.15 133.16 133.17 133.18 133.19 133.20 133.21 133.22 133.23 133.24 133.25 133.26 133.27 133.28 133.29 133.30 133.31 133.32 133.33 133.34 133.35 133.36 134.1 134.2 134.3 134.4 134.5 134.6 134.7 134.8 134.9 134.10 134.11 134.12 134.13 134.14 134.15 134.16 134.17 134.18 134.19 134.20 134.21 134.22 134.23 134.24 134.25 134.26 134.27 134.28 134.29 134.30 134.31 134.32 134.33 134.34 135.1 135.2 135.3
135.4 135.5
135.6 135.7 135.8 135.9 135.10 135.11 135.12 135.13 135.14 135.15 135.16 135.17 135.18 135.19 135.20 135.21 135.22 135.23 135.24 135.25 135.26 135.27 135.28 135.29 135.30 135.31 135.32 135.33 135.34 136.1 136.2 136.3 136.4 136.5 136.6 136.7 136.8 136.9 136.10 136.11 136.12 136.13 136.14 136.15 136.16 136.17 136.18 136.19 136.20 136.21 136.22 136.23 136.24 136.25 136.26 136.27 136.28 136.29
136.30 136.31
136.32 136.33 136.34 136.35 137.1 137.2 137.3 137.4 137.5 137.6 137.7 137.8 137.9
137.10 137.11 137.12
137.13 137.14 137.15 137.16 137.17 137.18 137.19 137.20 137.21 137.22 137.23 137.24
137.25 137.26 137.27 137.28 137.29 137.30 137.31 137.32 138.1 138.2 138.3 138.4 138.5 138.6 138.7 138.8 138.9 138.10 138.11 138.12
138.13 138.14 138.15 138.16 138.17 138.18 138.19 138.20 138.21 138.22 138.23
138.24
138.25 138.26
138.27

A bill for an act
relating to financing of state and local government; making policy, technical,
administrative, and clarifying changes to individual income, corporate franchise,
estate, property, sales and use, special, mineral, liquor, aggregate materials,
local, and other taxes and tax-related provisions; making technical, minor,
and clarifying changes in enterprise zone and economic development powers
and eliminating obsolete provisions; making clarifying, technical, and other
changes to the issuance of municipal bonds; modifying tax-exempt bonding
provisions; authorizing certain local governments to issue public debt; modifying
use of revenues and authorizing extension of certain sales and lodging taxes
for certain cities; requiring a solicitor nexus study; exempting certain cities
from 2011 aid payment penalties; amending Minnesota Statutes 2010, sections
13.4965, subdivision 3; 16A.46; 16C.16, subdivision 7; 41A.036, subdivision
2; 65B.84, subdivision 1; 117.025, subdivision 10; 126C.48, subdivision 8;
270.077; 270.41, subdivision 5; 270B.14, subdivision 3; 270C.38, subdivision 1;
270C.42, subdivision 2; 270C.69, subdivision 1; 272.01, subdivision 2; 272.02,
subdivision 77; 272.03, subdivision 9; 273.111, by adding a subdivision; 273.124,
subdivision 13; 273.13, subdivision 24; 273.1315, subdivisions 1, 2; 273.1398,
subdivision 4; 273.19, subdivision 1; 273.372, subdivision 4; 273.39; 275.065,
subdivision 3; 276A.01, subdivision 3; 279.06, subdivision 1; 287.20, by adding
a subdivision; 287.385, subdivision 7; 289A.02, by adding a subdivision;
289A.10, by adding a subdivision; 289A.12, by adding a subdivision; 289A.18,
by adding a subdivision; 289A.20, subdivision 3, by adding a subdivision;
289A.26, subdivisions 3, 4, 7, 9; 289A.38, subdivisions 7, 8, 9; 289A.42,
subdivision 2; 289A.55, subdivision 9; 289A.60, subdivisions 4, 24; 290.01,
subdivisions 6b, 19d, 29; 290.067, subdivision 1; 290.0921, subdivision 3;
290.095, subdivision 3; 290.17, subdivision 4; 290A.25; 290B.04, subdivision 2;
296A.22; 297A.665; 297A.8155; 297A.99, subdivision 4; 297E.14, subdivision
7; 297F.01, subdivision 23; 297F.09, subdivision 9; 297F.18, subdivision 7;
297G.04, subdivision 2; 297G.09, subdivision 8; 297G.17, subdivision 7;
297I.05, subdivision 11; 297I.30, by adding a subdivision; 297I.80, subdivision
1; 298.018, subdivision 2; 298.75, by adding a subdivision; 373.40, subdivisions
1, 2, 4; 383A.80, subdivision 4; 383B.80, subdivision 4; 469.015, subdivision
4; 469.033, subdivision 7; 469.166, subdivisions 3, 5, 6; 469.167, subdivision
2; 469.171, subdivisions 1, 4, 6a, 7, 9, 11; 469.172; 469.173, subdivisions 5, 6;
469.174, subdivisions 20, 25; 469.176, subdivision 7; 469.1763, subdivision
6; 469.1764, subdivision 1; 469.177, subdivision 1; 469.1793; 469.1813,
subdivision 6b; 473F.02, subdivision 3; 474A.02, subdivision 23a; 474A.04,
subdivision 1a; 474A.062; 474A.091, subdivision 3a; 475.521, subdivisions
2, 4; 475.58, subdivision 3b; 477A.017, subdivision 3; Minnesota Statutes
2011 Supplement, sections 270C.34, subdivision 1; 272.02, subdivisions 39,
97; 273.114, subdivision 6; 273.13, subdivisions 23, 25; 276.04, subdivision 2;
290.01, subdivisions 19b, 19c; 290.06, subdivision 2c; 290.0671, subdivision
1; 290.091, subdivision 2; 290.0922, subdivisions 2, 3; 291.03, subdivisions
8, 9, 10, 11; 297A.75, subdivision 1; 297I.05, subdivisions 7, 12; 297I.30,
subdivisions 1, 2; 298.01, subdivision 3; 373.01, subdivision 1; Laws 1971,
chapter 773, section 1, subdivision 2, as amended; Laws 1988, chapter 645,
section 3, as amended; Laws 1998, chapter 389, article 8, section 43, subdivision
3, as amended; Laws 2002, chapter 377, article 3, section 25, as amended; Laws
2003, chapter 127, article 12, section 28; Laws 2005, First Special Session
chapter 3, article 5, section 37, subdivisions 2, 4; Laws 2008, chapter 366, article
7, section 19, subdivision 3, as amended; Laws 2011, First Special Session
chapter 7, article 10, section 7; proposing coding for new law in Minnesota
Statutes, chapter 297I; repealing Minnesota Statutes 2010, sections 168A.40,
subdivisions 3, 4; 270C.991, subdivision 5; 272.02, subdivision 83; 272.69;
273.11, subdivision 22; 290.06, subdivisions 24, 32; 297A.68, subdivision
41; 469.042, subdivisions 2, 3, 4; 469.043; 469.059, subdivision 13; 469.129;
469.134; 469.162, subdivision 2; 469.1651; 469.166, subdivisions 7, 8, 9, 10, 11,
12; 469.167, subdivisions 1, 3; 469.168; 469.169, subdivisions 1, 2, 3, 4, 5, 6, 7,
8, 9, 10, 11, 13; 469.170, subdivisions 1, 2, 3, 4, 5, 5a, 5b, 5c, 5d, 5e, 6, 7, 8;
469.171, subdivisions 2, 5, 6b; 469.173, subdivisions 1, 3; 469.1765; 469.1791;
469.1799, subdivision 2; 469.301, subdivisions 1, 2, 3, 4, 5; 469.302; 469.303;
469.304; 469.321; 469.3215; 469.322; 469.323; 469.324; 469.325; 469.326;
469.327; 469.328; 469.329; 473.680; Laws 2009, chapter 88, article 4, section
23, as amended.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

ARTICLE 1

DEPARTMENT POLICY AND TECHNICAL: INCOME AND
CORPORATE FRANCHISE TAXES

Section 1.

Minnesota Statutes 2010, section 289A.02, is amended by adding a
subdivision to read:


new text begin Subd. 9. new text end

new text begin Field audit. new text end

new text begin "Field audit" means the physical presence of examiners
in the taxpayer's or taxpayer's representative's office conducting an examination of the
taxpayer with the intention of issuing an assessment or notice of change in tax or which
results in the issuing of an assessment or notice of change in tax. The examination may
include inspecting a taxpayer's place of business, tangible personal property, equipment,
computer systems and facilities, pertinent books, records, papers, vouchers, computer
printouts, accounts, and documents.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 2.

Minnesota Statutes 2010, section 289A.26, subdivision 3, is amended to read:


Subd. 3.

Short taxable year.

(a) new text begin A corporation or new text end an entity with a short taxable
year of less than 12 months, but at least four months, must pay estimated tax in equal
installments on or before the 15th day of the third, sixth, ninth, and final month of the
short taxable year, to the extent applicable based on the number of months in the short
taxable year.

(b) new text begin A corporation or new text end an entity is not required to make estimated tax payments for a
short taxable year unless its tax liability before the first day of the last month of the taxable
year can reasonably be expected to exceed $500.

(c) No payment is required for a short taxable year of less than four months.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 3.

Minnesota Statutes 2010, section 289A.26, subdivision 4, is amended to read:


Subd. 4.

Underpayment of estimated tax.

If there is an underpayment of estimated
tax by a corporationnew text begin or an entitynew text end , there shall be added to the tax for the taxable year an
amount determined at the rate in section 270C.40 on the amount of the underpayment,
determined under subdivision 5, for the period of the underpayment determined under
subdivision 6. This subdivision does not apply in the first taxable year that a corporation is
subject to the tax imposed under section 290.02new text begin or an entity is subject to the tax imposed
under section 290.05, subdivision 3
new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 4.

Minnesota Statutes 2010, section 289A.26, subdivision 7, is amended to read:


Subd. 7.

Required installments.

(a) Except as otherwise provided in this
subdivision, the amount of a required installment is 25 percent of the required annual
payment.

(b) Except as otherwise provided in this subdivision, the term "required annual
payment" means the lesser of:

(1) 100 percent of the tax shown on the return for the taxable year, or, if no return is
filed, 100 percent of the tax for that year; or

(2) 100 percent of the tax shown on the return of thenew text begin corporation ornew text end entity for the
preceding taxable year provided the return was for a full 12-month period, showed a
liability, and was filed by thenew text begin corporation ornew text end entity.

(c) Except for determining the first required installment for any taxable year,
paragraph (b), clause (2), does not apply in the case of a large corporation. The term
"large corporation" means a corporation or any predecessor corporation that had taxable
net income of $1,000,000 or more for any taxable year during the testing period. The
term "testing period" means the three taxable years immediately preceding the taxable
year involved. A reduction allowed to a large corporation for the first installment that is
allowed by applying paragraph (b), clause (2), must be recaptured by increasing the next
required installment by the amount of the reduction.

(d) In the case of a required installment, if the corporationnew text begin or entitynew text end establishes that
the annualized income installment is less than the amount determined in paragraph (a), the
amount of the required installment is the annualized income installment and the recapture
of previous quarters' reductions allowed by this paragraph must be recovered by increasing
later required installments to the extent the reductions have not previously been recovered.

(e) The "annualized income installment" is the excess, if any, of:

(1) an amount equal to the applicable percentage of the tax for the taxable year
computed by placing on an annualized basis the taxable income:

(i) for the first two months of the taxable year, in the case of the first required
installment;

(ii) for the first two months or for the first five months of the taxable year, in the
case of the second required installment;

(iii) for the first six months or for the first eight months of the taxable year, in the
case of the third required installment; and

(iv) for the first nine months or for the first 11 months of the taxable year, in the
case of the fourth required installment, over

(2) the aggregate amount of any prior required installments for the taxable year.

(3) For the purpose of this paragraph, the annualized income shall be computed
by placing on an annualized basis the taxable income for the year up to the end of the
month preceding the due date for the quarterly payment multiplied by 12 and dividing
the resulting amount by the number of months in the taxable year (2, 5, 6, 8, 9, or 11 as
the case may be) referred to in clause (1).

(4) The "applicable percentage" used in clause (1) is:

For the following
required
installments:
The applicable
percentage is:
1st
25
2nd
50
3rd
75
4th
100

(f)(1) If this paragraph applies, the amount determined for any installment must
be determined in the following manner:

(i) take the taxable income for the months during the taxable year preceding the
filing month;

(ii) divide that amount by the base period percentage for the months during the
taxable year preceding the filing month;

(iii) determine the tax on the amount determined under item (ii); and

(iv) multiply the tax computed under item (iii) by the base period percentage for the
filing month and the months during the taxable year preceding the filing month.

(2) For purposes of this paragraph:

(i) the "base period percentage" for a period of months is the average percent that the
taxable income for the corresponding months in each of the three preceding taxable years
bears to the taxable income for the three preceding taxable years;

(ii) the term "filing month" means the month in which the installment is required
to be paid;

(iii) this paragraph only applies if the base period percentage for any six consecutive
months of the taxable year equals or exceeds 70 percent; and

(iv) the commissioner may provide by rule for the determination of the base period
percentage in the case of reorganizations, new corporationsnew text begin or entitiesnew text end , and other similar
circumstances.

(3) In the case of a required installment determined under this paragraph, if thenew text begin
corporation or
new text end entity determines that the installment is less than the amount determined in
paragraph (a), the amount of the required installment is the amount determined under this
paragraph and the recapture of previous quarters' reductions allowed by this paragraph
must be recovered by increasing later required installments to the extent the reductions
have not previously been recovered.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 5.

Minnesota Statutes 2010, section 289A.26, subdivision 9, is amended to read:


Subd. 9.

Failure to file an estimate.

In the case ofnew text begin a corporation ornew text end an entity
that fails to file an estimated tax for a taxable year when one is required, the period of
the underpayment runs from the four installment dates in subdivision 2 or 3, whichever
applies, to the earlier of the periods in subdivision 6, clauses (1) and (2).

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 6.

Minnesota Statutes 2010, section 289A.38, subdivision 7, is amended to read:


Subd. 7.

Federal tax changes.

If the amount of income, items of tax preference,
deductions, or credits for any year of a taxpayer, or the wages paid by a taxpayer for
any period, as reported to the Internal Revenue Service is changed or corrected by the
commissioner of Internal Revenue or other officer of the United States or other competent
authority, or where a renegotiation of a contract or subcontract with the United States
results in a change in income, items of tax preference, deductions, credits, or withholding
tax, or, in the case of estate tax, where there are adjustments to the taxable estate, the
taxpayer shall report the change or correction or renegotiation results in writing to the
commissionernew text begin of revenuenew text end . The report must be deleted text begin submitted within 180 days after the
final determination and must be
deleted text end in the form of either an amended Minnesota estate,
withholding tax, corporate franchise tax, or income tax return conceding the accuracy of
the federal determination or a letter detailing how the federal determination is incorrect
or does not change the Minnesota tax. An amended Minnesota income tax return must
be accompanied by an amended property tax refund return, if necessary. A taxpayer
filing an amended federal tax return must also file a copy of the amended return with the
commissioner of revenue deleted text begin within 180 daysdeleted text end after filing the amended return.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 7.

Minnesota Statutes 2010, section 289A.38, subdivision 8, is amended to read:


Subd. 8.

deleted text begin Failure to report change or correction of federal returndeleted text end new text begin Time
requirement to report federal tax changes
new text end .

deleted text begin If a taxpayer fails to make a report as
required by subdivision 7, the commissioner may recompute the tax, including a refund,
based on information available to the commissioner. The tax may be recomputed within
six years after the report should have been filed, notwithstanding any period of limitations
to the contrary.
deleted text end new text begin A taxpayer must submit the report or file the amended return required by
subdivision 7 within 180 days after the final determination by the commissioner of internal
revenue or other officer of the United States or other competent authority of a change or
correction of the person's federal tax return or the filing of an amended federal tax return.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 8.

Minnesota Statutes 2010, section 289A.38, subdivision 9, is amended to read:


Subd. 9.

deleted text begin Report made of change or correction of federal returndeleted text end new text begin Limitations
on time for assessment for federal tax changes
new text end .

new text begin (a) new text end If a taxpayer deleted text begin is required to make adeleted text end new text begin
submits the
new text end report deleted text begin underdeleted text end new text begin or files the amended return as required bynew text end subdivision 7deleted text begin , and does
report the change or files a copy of the amended return
deleted text end new text begin at any time within six years after
the time period provided by subdivision 8
new text end , the commissioner may recompute and reassess
the tax due, including a refund (1) within one year after the report or amended return is
filed with the commissioner, notwithstanding any period of limitations to the contrary, or
(2) within any other applicable period stated in this section, whichever period is longer.
The period provided for the carryback of any amount of loss or credit is also extended as
provided in this subdivision, notwithstanding any law to the contrary.

new text begin (b) If a taxpayer fails to submit the report or file the amended return as required by
subdivision 7, the commissioner may recompute the tax, including a refund, based on
information available to the commissioner. The tax may be recomputed within six years
after the time period provided by subdivision 8, notwithstanding any period of limitations
to the contrary.
new text end

new text begin (c)new text end If the commissioner has completed a field audit of the taxpayer, and, but for this
subdivision, the commissioner's time period to adjust the tax has expired, the additional
tax due or refund is limited to only those changes that are required to be made to the
return which relate to the changes made on the federal return. This subdivision does not
apply to sales and use tax.

deleted text begin For purposes of this subdivision and section 289A.42, subdivision 2, a "field audit"
is the physical presence of examiners in the taxpayer's or taxpayer's representative's office
conducting an examination of the taxpayer with the intention of issuing an assessment or
notice of change in tax or which results in the issuing of an assessment or notice of change
in tax. The examination may include inspecting a taxpayer's place of business, tangible
personal property, equipment, computer systems and facilities, pertinent books, records,
papers, vouchers, computer printouts, accounts, and documents.
deleted text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 9.

Minnesota Statutes 2010, section 289A.42, subdivision 2, is amended to read:


Subd. 2.

Federal extensions.

When a taxpayer consents to an extension of time
for the assessment of federal withholding or income taxes, the period in which the
commissioner may recompute the tax is also extended, notwithstanding any period of
limitations to the contrary, as follows:

(1) for the periods provided in section 289A.38, subdivisions 8 and 9;

(2) for six months following the expiration of the extended federal period of
limitations when no change is made by the federal authority. If no change is made by the
federal authority, and, but for this subdivision, the commissioner's time period to adjust
the tax has expired, and if the commissioner has completed a field audit of the taxpayer, no
additional changes resulting in additional tax due or a refund may be made. deleted text begin For purposes
of this subdivision, "field audit" has the meaning given it in section 289A.38, subdivision 9.
deleted text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 10.

Minnesota Statutes 2010, section 289A.60, subdivision 24, is amended to read:


Subd. 24.

Penalty for failure to notify of federal change.

If a person fails to
report to the commissioner a change or correction of the person's federal return in the
mannernew text begin prescribed by section 289A.38, subdivision 7,new text end and new text begin within the 180-day new text end time new text begin period
new text end prescribed in section 289A.38, subdivision deleted text begin 7deleted text end new text begin 8new text end , there must be added to the tax an amount
equal to ten percent of the amount of any underpayment of Minnesota tax attributable to
the federal change.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 11.

Minnesota Statutes 2010, section 290.01, subdivision 6b, is amended to read:


Subd. 6b.

Foreign operating corporation.

The term "foreign operating
corporation," when applied to a corporation, means a domestic corporation with the
following characteristics:

(1) it is part of a unitary business at least one member of which is taxable in this state;

(2) it is not a foreign sales corporation under section 922 of the Internal Revenue
Code, as amended through December 31, 1999, for the taxable year;

(3) it is not an interest charge domestic international sales corporation under sections
992, 993, 994, and 995 of the Internal Revenue Code;

(4) deleted text begin either (i) it has in effect a valid election under section 936 of the Internal Revenue
Code; or (ii)
deleted text end at least 80 percent of the gross income from all sources of the corporation in
the tax year is active foreign business income; and

(5) for purposes of this subdivision, active foreign business income means gross
income that is (i) derived from sources without the United States, as defined in subtitle A,
chapter 1, subchapter N, part 1, of the Internal Revenue Code; and (ii) attributable to the
active conduct of a trade or business in a foreign country.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after
December 31, 2011.
new text end

Sec. 12.

Minnesota Statutes 2011 Supplement, section 290.01, subdivision 19b,
is amended to read:


Subd. 19b.

Subtractions from federal taxable income.

For individuals, estates,
and trusts, there shall be subtracted from federal taxable income:

(1) net interest income on obligations of any authority, commission, or
instrumentality of the United States to the extent includable in taxable income for federal
income tax purposes but exempt from state income tax under the laws of the United States;

(2) if included in federal taxable income, the amount of any overpayment of income
tax to Minnesota or to any other state, for any previous taxable year, whether the amount
is received as a refund or as a credit to another taxable year's income tax liability;

(3) the amount paid to others, less the amount used to claim the credit allowed under
section 290.0674, not to exceed $1,625 for each qualifying child in grades kindergarten
to 6 and $2,500 for each qualifying child in grades 7 to 12, for tuition, textbooks, and
transportation of each qualifying child in attending an elementary or secondary school
situated in Minnesota, North Dakota, South Dakota, Iowa, or Wisconsin, wherein a
resident of this state may legally fulfill the state's compulsory attendance laws, which
is not operated for profit, and which adheres to the provisions of the Civil Rights Act
of 1964 and chapter 363A. For the purposes of this clause, "tuition" includes fees or
tuition as defined in section 290.0674, subdivision 1, clause (1). As used in this clause,
"textbooks" includes books and other instructional materials and equipment purchased
or leased for use in elementary and secondary schools in teaching only those subjects
legally and commonly taught in public elementary and secondary schools in this state.
Equipment expenses qualifying for deduction includes expenses as defined and limited in
section 290.0674, subdivision 1, clause (3). "Textbooks" does not include instructional
books and materials used in the teaching of religious tenets, doctrines, or worship, the
purpose of which is to instill such tenets, doctrines, or worship, nor does it include books
or materials for, or transportation to, extracurricular activities including sporting events,
musical or dramatic events, speech activities, driver's education, or similar programs. No
deduction is permitted for any expense the taxpayer incurred in using the taxpayer's or
the qualifying child's vehicle to provide such transportation for a qualifying child. For
purposes of the subtraction provided by this clause, "qualifying child" has the meaning
given in section 32(c)(3) of the Internal Revenue Code;

(4) income as provided under section 290.0802;

(5) to the extent included in federal adjusted gross income, income realized on
disposition of property exempt from tax under section 290.491;

(6) to the extent not deducted or not deductible pursuant to section 408(d)(8)(E)
of the Internal Revenue Code in determining federal taxable income by an individual
who does not itemize deductions for federal income tax purposes for the taxable year, an
amount equal to 50 percent of the excess of charitable contributions over $500 allowable
as a deduction for the taxable year under section 170(a) of the Internal Revenue Code,
under the provisions of Public Law 109-1 and Public Law 111-126;

(7) for individuals who are allowed a federal foreign tax credit for taxes that do not
qualify for a credit under section 290.06, subdivision 22, an amount equal to the carryover
of subnational foreign taxes for the taxable year, but not to exceed the total subnational
foreign taxes reported in claiming the foreign tax credit. For purposes of this clause,
"federal foreign tax credit" means the credit allowed under section 27 of the Internal
Revenue Code, and "carryover of subnational foreign taxes" equals the carryover allowed
under section 904(c) of the Internal Revenue Code minus national level foreign taxes to
the extent they exceed the federal foreign tax credit;

(8) in each of the five tax years immediately following the tax year in which an
addition is required under subdivision 19a, clause (7), or 19c, clause deleted text begin (15)deleted text end new text begin (14)new text end , in the case
of a shareholder of a corporation that is an S corporation, an amount equal to one-fifth
of the delayed depreciation. For purposes of this clause, "delayed depreciation" means
the amount of the addition made by the taxpayer under subdivision 19a, clause (7), or
subdivision 19c, clause deleted text begin (15)deleted text end new text begin (14)new text end , in the case of a shareholder of an S corporation, minus
the positive value of any net operating loss under section 172 of the Internal Revenue
Code generated for the tax year of the addition. The resulting delayed depreciation
cannot be less than zero;

(9) job opportunity building zone income as provided under section 469.316;

(10) to the extent included in federal taxable income, the amount of compensation
paid to members of the Minnesota National Guard or other reserve components of the
United States military for active service, excluding compensation for services performed
under the Active Guard Reserve (AGR) program. For purposes of this clause, "active
service" means (i) state active service as defined in section 190.05, subdivision 5a, clause
(1); or (ii) federally funded state active service as defined in section 190.05, subdivision
5b
, but "active service" excludes service performed in accordance with section 190.08,
subdivision 3
;

(11) to the extent included in federal taxable income, the amount of compensation
paid to Minnesota residents who are members of the armed forces of the United States
or United Nations for active duty performed under United States Code, title 10; or the
authority of the United Nations;

(12) an amount, not to exceed $10,000, equal to qualified expenses related to a
qualified donor's donation, while living, of one or more of the qualified donor's organs
to another person for human organ transplantation. For purposes of this clause, "organ"
means all or part of an individual's liver, pancreas, kidney, intestine, lung, or bone marrow;
"human organ transplantation" means the medical procedure by which transfer of a human
organ is made from the body of one person to the body of another person; "qualified
expenses" means unreimbursed expenses for both the individual and the qualified donor
for (i) travel, (ii) lodging, and (iii) lost wages net of sick pay, except that such expenses
may be subtracted under this clause only once; and "qualified donor" means the individual
or the individual's dependent, as defined in section 152 of the Internal Revenue Code. An
individual may claim the subtraction in this clause for each instance of organ donation for
transplantation during the taxable year in which the qualified expenses occur;

(13) in each of the five tax years immediately following the tax year in which an
addition is required under subdivision 19a, clause (8), or 19c, clause deleted text begin (16)deleted text end new text begin (15)new text end , in the case
of a shareholder of a corporation that is an S corporation, an amount equal to one-fifth
of the addition made by the taxpayer under subdivision 19a, clause (8), or 19c, clause
deleted text begin (16)deleted text end new text begin (15)new text end , in the case of a shareholder of a corporation that is an S corporation, minus the
positive value of any net operating loss under section 172 of the Internal Revenue Code
generated for the tax year of the addition. If the net operating loss exceeds the addition for
the tax year, a subtraction is not allowed under this clause;

(14) to the extent included in the federal taxable income of a nonresident of
Minnesota, compensation paid to a service member as defined in United States Code, title
10, section 101(a)(5), for military service as defined in the Servicemembers Civil Relief
Act, Public Law 108-189, section 101(2);

(15) international economic development zone income as provided under section
469.325;

(16) to the extent included in federal taxable income, the amount of national service
educational awards received from the National Service Trust under United States Code,
title 42, sections 12601 to 12604, for service in an approved Americorps National Service
program;

(17) to the extent included in federal taxable income, discharge of indebtedness
income resulting from reacquisition of business indebtedness included in federal taxable
income under section 108(i) of the Internal Revenue Code. This subtraction applies only
to the extent that the income was included in net income in a prior year as a result of the
addition under section 290.01, subdivision 19a, clause (16); and

(18) the amount of the net operating loss allowed under section 290.095, subdivision
11, paragraph (c).

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after
December 31, 2011.
new text end

Sec. 13.

Minnesota Statutes 2011 Supplement, section 290.01, subdivision 19c,
is amended to read:


Subd. 19c.

Corporations; additions to federal taxable income.

For corporations,
there shall be added to federal taxable income:

(1) the amount of any deduction taken for federal income tax purposes for income,
excise, or franchise taxes based on net income or related minimum taxes, including but not
limited to the tax imposed under section 290.0922, paid by the corporation to Minnesota,
another state, a political subdivision of another state, the District of Columbia, or any
foreign country or possession of the United States;

(2) interest not subject to federal tax upon obligations of: the United States, its
possessions, its agencies, or its instrumentalities; the state of Minnesota or any other
state, any of its political or governmental subdivisions, any of its municipalities, or any
of its governmental agencies or instrumentalities; the District of Columbia; or Indian
tribal governments;

(3) exempt-interest dividends received as defined in section 852(b)(5) of the Internal
Revenue Code;

(4) the amount of any net operating loss deduction taken for federal income tax
purposes under section 172 or 832(c)(10) of the Internal Revenue Code or operations loss
deduction under section 810 of the Internal Revenue Code;

(5) the amount of any special deductions taken for federal income tax purposes
under sections 241 to 247 and 965 of the Internal Revenue Code;

(6) losses from the business of mining, as defined in section 290.05, subdivision 1,
clause (a), that are not subject to Minnesota income tax;

(7) the amount of any capital losses deducted for federal income tax purposes under
sections 1211 and 1212 of the Internal Revenue Code;

(8) the exempt foreign trade income of a foreign sales corporation under sections
921(a) and 291 of the Internal Revenue Code;

(9) the amount of percentage depletion deducted under sections 611 through 614 and
291 of the Internal Revenue Code;

(10) for certified pollution control facilities placed in service in a taxable year
beginning before December 31, 1986, and for which amortization deductions were elected
under section 169 of the Internal Revenue Code of 1954, as amended through December
31, 1985, the amount of the amortization deduction allowed in computing federal taxable
income for those facilities;

(11) the amount of any deemed dividend from a foreign operating corporation
determined pursuant to section 290.17, subdivision 4, paragraph (g). The deemed dividend
shall be reduced by the amount of the addition to income required by clauses new text begin (19), new text end (20),
(21), new text begin and new text end (22)deleted text begin , and (23)deleted text end ;

(12) the amount of a partner's pro rata share of net income which does not flow
through to the partner because the partnership elected to pay the tax on the income under
section 6242(a)(2) of the Internal Revenue Code;

deleted text begin (13) the amount of net income excluded under section 114 of the Internal Revenue
Code;
deleted text end

deleted text begin (14)deleted text end new text begin (13)new text end any increase in subpart F income, as defined in section 952(a) of the
Internal Revenue Code, for the taxable year when subpart F income is calculated without
regard to the provisions of Division C, title III, section 303(b) of Public Law 110-343;

deleted text begin (15)deleted text end new text begin (14)new text end 80 percent of the depreciation deduction allowed under section
168(k)(1)(A) and (k)(4)(A) of the Internal Revenue Code. For purposes of this clause, if
the taxpayer has an activity that in the taxable year generates a deduction for depreciation
under section 168(k)(1)(A) and (k)(4)(A) and the activity generates a loss for the taxable
year that the taxpayer is not allowed to claim for the taxable year, "the depreciation
allowed under section 168(k)(1)(A) and (k)(4)(A)" for the taxable year is limited to excess
of the depreciation claimed by the activity under section 168(k)(1)(A) and (k)(4)(A)
over the amount of the loss from the activity that is not allowed in the taxable year. In
succeeding taxable years when the losses not allowed in the taxable year are allowed, the
depreciation under section 168(k)(1)(A) and (k)(4)(A) is allowed;

deleted text begin (16)deleted text end new text begin (15)new text end 80 percent of the amount by which the deduction allowed by section 179 of
the Internal Revenue Code exceeds the deduction allowable by section 179 of the Internal
Revenue Code of 1986, as amended through December 31, 2003;

deleted text begin (17)deleted text end new text begin (16)new text end to the extent deducted in computing federal taxable income, the amount of
the deduction allowable under section 199 of the Internal Revenue Code;

deleted text begin (18)deleted text end new text begin (17)new text end for taxable years beginning before January 1, 2013, the exclusion allowed
under section 139A of the Internal Revenue Code for federal subsidies for prescription
drug plans;

deleted text begin (19)deleted text end new text begin (18)new text end the amount of expenses disallowed under section 290.10, subdivision 2;

deleted text begin (20)deleted text end new text begin (19)new text end an amount equal to the interest and intangible expenses, losses, and
costs paid, accrued, or incurred by any member of the taxpayer's unitary group to or for
the benefit of a corporation that is a member of the taxpayer's unitary business group
that qualifies as a foreign operating corporation. For purposes of this clause, intangible
expenses and costs include:

(i) expenses, losses, and costs for, or related to, the direct or indirect acquisition,
use, maintenance or management, ownership, sale, exchange, or any other disposition of
intangible property;

(ii) losses incurred, directly or indirectly, from factoring transactions or discounting
transactions;

(iii) royalty, patent, technical, and copyright fees;

(iv) licensing fees; and

(v) other similar expenses and costs.

For purposes of this clause, "intangible property" includes stocks, bonds, patents, patent
applications, trade names, trademarks, service marks, copyrights, mask works, trade
secrets, and similar types of intangible assets.

This clause does not apply to any item of interest or intangible expenses or costs paid,
accrued, or incurred, directly or indirectly, to a foreign operating corporation with respect
to such item of income to the extent that the income to the foreign operating corporation
is income from sources without the United States as defined in subtitle A, chapter 1,
subchapter N, part 1, of the Internal Revenue Code;

deleted text begin (21)deleted text end new text begin (20)new text end except as already included in the taxpayer's taxable income pursuant to
clause deleted text begin (20)deleted text end new text begin (19)new text end , any interest income and income generated from intangible property
received or accrued by a foreign operating corporation that is a member of the taxpayer's
unitary group. For purposes of this clause, income generated from intangible property
includes:

(i) income related to the direct or indirect acquisition, use, maintenance or
management, ownership, sale, exchange, or any other disposition of intangible property;

(ii) income from factoring transactions or discounting transactions;

(iii) royalty, patent, technical, and copyright fees;

(iv) licensing fees; and

(v) other similar income.

For purposes of this clause, "intangible property" includes stocks, bonds, patents, patent
applications, trade names, trademarks, service marks, copyrights, mask works, trade
secrets, and similar types of intangible assets.

This clause does not apply to any item of interest or intangible income received or accrued
by a foreign operating corporation with respect to such item of income to the extent that
the income is income from sources without the United States as defined in subtitle A,
chapter 1, subchapter N, part 1, of the Internal Revenue Code;

deleted text begin (22)deleted text end new text begin (21)new text end the dividends attributable to the income of a foreign operating corporation
that is a member of the taxpayer's unitary group in an amount that is equal to the dividends
paid deduction of a real estate investment trust under section 561(a) of the Internal
Revenue Code for amounts paid or accrued by the real estate investment trust to the
foreign operating corporation;

deleted text begin (23)deleted text end new text begin (22)new text end the income of a foreign operating corporation that is a member of the
taxpayer's unitary group in an amount that is equal to gains derived from the sale of real or
personal property located in the United States;

deleted text begin (24)deleted text end new text begin (23)new text end for taxable years beginning before January 1, 2010, the additional amount
allowed as a deduction for donation of computer technology and equipment under section
170(e)(6) of the Internal Revenue Code, to the extent deducted from taxable income; and

deleted text begin (25)deleted text end new text begin (24)new text end discharge of indebtedness income resulting from reacquisition of business
indebtedness and deferred under section 108(i) of the Internal Revenue Code.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after
December 31, 2011.
new text end

Sec. 14.

Minnesota Statutes 2010, section 290.01, subdivision 19d, is amended to read:


Subd. 19d.

Corporations; modifications decreasing federal taxable income.

For
corporations, there shall be subtracted from federal taxable income after the increases
provided in subdivision 19c:

(1) the amount of foreign dividend gross-up added to gross income for federal
income tax purposes under section 78 of the Internal Revenue Code;

(2) the amount of salary expense not allowed for federal income tax purposes due to
claiming the work opportunity credit under section 51 of the Internal Revenue Code;

(3) any dividend (not including any distribution in liquidation) paid within the
taxable year by a national or state bank to the United States, or to any instrumentality of
the United States exempt from federal income taxes, on the preferred stock of the bank
owned by the United States or the instrumentality;

(4) amounts disallowed for intangible drilling costs due to differences between
this chapter and the Internal Revenue Code in taxable years beginning before January
1, 1987, as follows:

(i) to the extent the disallowed costs are represented by physical property, an amount
equal to the allowance for depreciation under Minnesota Statutes 1986, section 290.09,
subdivision 7
, subject to the modifications contained in subdivision 19e; and

(ii) to the extent the disallowed costs are not represented by physical property, an
amount equal to the allowance for cost depletion under Minnesota Statutes 1986, section
290.09, subdivision 8;

(5) the deduction for capital losses pursuant to sections 1211 and 1212 of the
Internal Revenue Code, except that:

(i) for capital losses incurred in taxable years beginning after December 31, 1986,
capital loss carrybacks shall not be allowed;

(ii) for capital losses incurred in taxable years beginning after December 31, 1986,
a capital loss carryover to each of the 15 taxable years succeeding the loss year shall be
allowed;

(iii) for capital losses incurred in taxable years beginning before January 1, 1987, a
capital loss carryback to each of the three taxable years preceding the loss year, subject to
the provisions of Minnesota Statutes 1986, section 290.16, shall be allowed; and

(iv) for capital losses incurred in taxable years beginning before January 1, 1987,
a capital loss carryover to each of the five taxable years succeeding the loss year to the
extent such loss was not used in a prior taxable year and subject to the provisions of
Minnesota Statutes 1986, section 290.16, shall be allowed;

(6) an amount for interest and expenses relating to income not taxable for federal
income tax purposes, if (i) the income is taxable under this chapter and (ii) the interest and
expenses were disallowed as deductions under the provisions of section 171(a)(2), 265 or
291 of the Internal Revenue Code in computing federal taxable income;

(7) in the case of mines, oil and gas wells, other natural deposits, and timber for
which percentage depletion was disallowed pursuant to subdivision 19c, clause (9), a
reasonable allowance for depletion based on actual cost. In the case of leases the deduction
must be apportioned between the lessor and lessee in accordance with rules prescribed
by the commissioner. In the case of property held in trust, the allowable deduction must
be apportioned between the income beneficiaries and the trustee in accordance with the
pertinent provisions of the trust, or if there is no provision in the instrument, on the basis
of the trust's income allocable to each;

(8) for certified pollution control facilities placed in service in a taxable year
beginning before December 31, 1986, and for which amortization deductions were elected
under section 169 of the Internal Revenue Code of 1954, as amended through December
31, 1985, an amount equal to the allowance for depreciation under Minnesota Statutes
1986, section 290.09, subdivision 7;

(9) amounts included in federal taxable income that are due to refunds of income,
excise, or franchise taxes based on net income or related minimum taxes paid by the
corporation to Minnesota, another state, a political subdivision of another state, the
District of Columbia, or a foreign country or possession of the United States to the extent
that the taxes were added to federal taxable income under section 290.01, subdivision 19c,
clause (1), in a prior taxable year;

(10) 80 percent of royalties, fees, or other like income accrued or received from a
foreign operating corporation or a foreign corporation which is part of the same unitary
business as the receiving corporation, unless the income resulting from such payments or
accruals is income from sources within the United States as defined in subtitle A, chapter
1, subchapter N, part 1, of the Internal Revenue Code;

(11) income or gains from the business of mining as defined in section 290.05,
subdivision 1
, clause (a), that are not subject to Minnesota franchise tax;

(12) the amount of disability access expenditures in the taxable year which are not
allowed to be deducted or capitalized under section 44(d)(7) of the Internal Revenue Code;

(13) the amount of qualified research expenses not allowed for federal income tax
purposes under section 280C(c) of the Internal Revenue Code, but only to the extent that
the amount exceeds the amount of the credit allowed under section 290.068;

(14) the amount of salary expenses not allowed for federal income tax purposes due
to claiming the Indian employment credit under section 45A(a) of the Internal Revenue
Code;

deleted text begin (15) for a corporation whose foreign sales corporation, as defined in section 922
of the Internal Revenue Code, constituted a foreign operating corporation during any
taxable year ending before January 1, 1995, and a return was filed by August 15, 1996,
claiming the deduction under section 290.21, subdivision 4, for income received from
the foreign operating corporation, an amount equal to 1.23 multiplied by the amount of
income excluded under section 114 of the Internal Revenue Code, provided the income is
not income of a foreign operating company;
deleted text end

deleted text begin (16)deleted text end new text begin (15)new text end any decrease in subpart F income, as defined in section 952(a) of the
Internal Revenue Code, for the taxable year when subpart F income is calculated without
regard to the provisions of Division C, title III, section 303(b) of Public Law 110-343;

deleted text begin (17)deleted text end new text begin (16)new text end in each of the five tax years immediately following the tax year in which an
addition is required under subdivision 19c, clause deleted text begin (15)deleted text end new text begin (14)new text end , an amount equal to one-fifth
of the delayed depreciation. For purposes of this clause, "delayed depreciation" means the
amount of the addition made by the taxpayer under subdivision 19c, clause deleted text begin (15)deleted text end new text begin (14)new text end . The
resulting delayed depreciation cannot be less than zero;

deleted text begin (18)deleted text end new text begin (17)new text end in each of the five tax years immediately following the tax year in which an
addition is required under subdivision 19c, clause deleted text begin (16)deleted text end new text begin (15)new text end , an amount equal to one-fifth
of the amount of the addition; and

deleted text begin (19)deleted text end new text begin (18)new text end to the extent included in federal taxable income, discharge of indebtedness
income resulting from reacquisition of business indebtedness included in federal taxable
income under section 108(i) of the Internal Revenue Code. This subtraction applies only
to the extent that the income was included in net income in a prior year as a result of the
addition under section 290.01, subdivision 19c, clause deleted text begin (25)deleted text end new text begin (24)new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after
December 31, 2011.
new text end

Sec. 15.

Minnesota Statutes 2010, section 290.0921, subdivision 3, is amended to read:


Subd. 3.

Alternative minimum taxable income.

"Alternative minimum taxable
income" is Minnesota net income as defined in section 290.01, subdivision 19, and
includes the adjustments and tax preference items in sections 56, 57, 58, and 59(d), (e),
(f), and (h) of the Internal Revenue Code. If a corporation files a separate company
Minnesota tax return, the minimum tax must be computed on a separate company basis.
If a corporation is part of a tax group filing a unitary return, the minimum tax must be
computed on a unitary basis. The following adjustments must be made.

(1) For purposes of the depreciation adjustments under section 56(a)(1) and
56(g)(4)(A) of the Internal Revenue Code, the basis for depreciable property placed in
service in a taxable year beginning before January 1, 1990, is the adjusted basis for federal
income tax purposes, including any modification made in a taxable year under section
290.01, subdivision 19e, or Minnesota Statutes 1986, section 290.09, subdivision 7,
paragraph (c).

For taxable years beginning after December 31, 2000, the amount of any remaining
modification made under section 290.01, subdivision 19e, or Minnesota Statutes 1986,
section 290.09, subdivision 7, paragraph (c), not previously deducted is a depreciation
allowance in the first taxable year after December 31, 2000.

(2) The portion of the depreciation deduction allowed for federal income tax
purposes under section 168(k) of the Internal Revenue Code that is required as an addition
under section 290.01, subdivision 19c, clause deleted text begin (15)deleted text end new text begin (14)new text end , is disallowed in determining
alternative minimum taxable income.

(3) The subtraction for depreciation allowed under section 290.01, subdivision
19d
, clause deleted text begin (17)deleted text end new text begin (16)new text end , is allowed as a depreciation deduction in determining alternative
minimum taxable income.

(4) The alternative tax net operating loss deduction under sections 56(a)(4) and 56(d)
of the Internal Revenue Code does not apply.

(5) The special rule for certain dividends under section 56(g)(4)(C)(ii) of the Internal
Revenue Code does not apply.

deleted text begin (6) The special rule for dividends from section 936 companies under section
56(g)(4)(C)(iii) does not apply.
deleted text end

deleted text begin (7)deleted text end new text begin (6)new text end The tax preference for depletion under section 57(a)(1) of the Internal
Revenue Code does not apply.

deleted text begin (8)deleted text end new text begin (7)new text end The tax preference for intangible drilling costs under section 57(a)(2) of the
Internal Revenue Code must be calculated without regard to subparagraph (E) and the
subtraction under section 290.01, subdivision 19d, clause (4).

deleted text begin (9)deleted text end new text begin (8)new text end The tax preference for tax exempt interest under section 57(a)(5) of the
Internal Revenue Code does not apply.

deleted text begin (10)deleted text end new text begin (9)new text end The tax preference for charitable contributions of appreciated property
under section 57(a)(6) of the Internal Revenue Code does not apply.

deleted text begin (11)deleted text end new text begin (10)new text end For purposes of calculating the tax preference for accelerated depreciation
or amortization on certain property placed in service before January 1, 1987, under section
57(a)(7) of the Internal Revenue Code, the deduction allowable for the taxable year is the
deduction allowed under section 290.01, subdivision 19e.

For taxable years beginning after December 31, 2000, the amount of any remaining
modification made under section 290.01, subdivision 19e, not previously deducted is a
depreciation or amortization allowance in the first taxable year after December 31, 2004.

deleted text begin (12)deleted text end new text begin (11)new text end For purposes of calculating the adjustment for adjusted current earnings
in section 56(g) of the Internal Revenue Code, the term "alternative minimum taxable
income" as it is used in section 56(g) of the Internal Revenue Code, means alternative
minimum taxable income as defined in this subdivision, determined without regard to the
adjustment for adjusted current earnings in section 56(g) of the Internal Revenue Code.

deleted text begin (13)deleted text end new text begin (12)new text end For purposes of determining the amount of adjusted current earnings
under section 56(g)(3) of the Internal Revenue Code, no adjustment shall be made under
section 56(g)(4) of the Internal Revenue Code with respect to (i) the amount of foreign
dividend gross-up subtracted as provided in section 290.01, subdivision 19d, clause (1),
(ii) the amount of refunds of income, excise, or franchise taxes subtracted as provided in
section 290.01, subdivision 19d, clause (9), or (iii) the amount of royalties, fees or other
like income subtracted as provided in section 290.01, subdivision 19d, clause (10).

deleted text begin (14)deleted text end new text begin (13)new text end Alternative minimum taxable income excludes the income from operating
in a job opportunity building zone as provided under section 469.317.

deleted text begin (15)deleted text end new text begin (14)new text end Alternative minimum taxable income excludes the income from operating
in a biotechnology and health sciences industry zone as provided under section 469.337.

deleted text begin (16)deleted text end new text begin (15)new text end Alternative minimum taxable income excludes the income from operating
in an international economic development zone as provided under section 469.326.

Items of tax preference must not be reduced below zero as a result of the
modifications in this subdivision.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after
December 31, 2011.
new text end

Sec. 16.

Minnesota Statutes 2010, section 290.095, subdivision 3, is amended to read:


Subd. 3.

Carryover.

(a) A net operating loss incurred in a taxable year: (i)
beginning after December 31, 1986, shall be a net operating loss carryover to each of the
15 taxable years following the taxable year of such loss; (ii) beginning before January 1,
1987, shall be a net operating loss carryover to each of the five taxable years following the
taxable year of such loss subject to the provisions of Minnesota Statutes 1986, section
290.095; and (iii) beginning before January 1, 1987, shall be a net operating loss carryback
to each of the three taxable years preceding the loss year subject to the provisions of
Minnesota Statutes 1986, section 290.095.

(b) The entire amount of the net operating loss for any taxable year shall be carried to
the earliest of the taxable years to which such loss may be carried. The portion of such loss
which shall be carried to each of the other taxable years shall be the excess, if any, of the
amount of such loss over the sum of the taxable net income, adjusted by the modifications
specified in subdivision 4, for each of the taxable years to which such loss may be carried.

(c) Where a corporation apportions its income under the provisions of section
290.191, the net operating loss deduction incurred in any taxable year shall be allowed to
the extent of the apportionment ratio of the loss yearnew text begin , plus the loss assigned by section
290.17, subdivision 2
new text end .

(d) The provisions of sections 381, 382, and 384 of the Internal Revenue Code apply
to carryovers in certain corporate acquisitions and special limitations on net operating loss
carryovers. The limitation amount determined under section 382 shall be applied to net
income, before apportionment, in each post change year to which a loss is carried.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 17.

Minnesota Statutes 2010, section 290.17, subdivision 4, is amended to read:


Subd. 4.

Unitary business principle.

(a) If a trade or business conducted wholly
within this state or partly within and partly without this state is part of a unitary business,
the entire income of the unitary business is subject to apportionment pursuant to section
290.191. Notwithstanding subdivision 2, paragraph (c), none of the income of a unitary
business is considered to be derived from any particular source and none may be allocated
to a particular place except as provided by the applicable apportionment formula. The
provisions of this subdivision do not apply to business income subject to subdivision 5,
income of an insurance company, or income of an investment company determined under
section 290.36.

(b) The term "unitary business" means business activities or operations which
result in a flow of value between them. The term may be applied within a single legal
entity or between multiple entities and without regard to whether each entity is a sole
proprietorship, a corporation, a partnership or a trust.

(c) Unity is presumed whenever there is unity of ownership, operation, and use,
evidenced by centralized management or executive force, centralized purchasing,
advertising, accounting, or other controlled interaction, but the absence of these
centralized activities will not necessarily evidence a nonunitary business. Unity is also
presumed when business activities or operations are of mutual benefit, dependent upon or
contributory to one another, either individually or as a group.

(d) Where a business operation conducted in Minnesota is owned by a business
entity that carries on business activity outside the state different in kind from that
conducted within this state, and the other business is conducted entirely outside the state, it
is presumed that the two business operations are unitary in nature, interrelated, connected,
and interdependent unless it can be shown to the contrary.

(e) Unity of ownership deleted text begin isdeleted text end new text begin doesnew text end not deleted text begin deemed todeleted text end exist when deleted text begin a corporation isdeleted text end new text begin two or
more corporations are
new text end involved unless deleted text begin that corporation is a member of a group of two or
more business entities and
deleted text end more than 50 percent of the voting stock of each deleted text begin member of
the group
deleted text end new text begin corporationnew text end is directly or indirectly owned by a common owner or by common
owners, either corporate or noncorporate, or by one or more of the member corporations
of the group. For this purpose, the term "voting stock" shall include membership interests
of mutual insurance holding companies formed under section 66A.40.

(f) The net income and apportionment factors under section 290.191 or 290.20 of
foreign corporations and other foreign entities which are part of a unitary business shall
not be included in the net income or the apportionment factors of the unitary business.
A foreign corporation or other foreign entity which is required to file a return under this
chapter shall file on a separate return basis. The net income and apportionment factors
under section 290.191 or 290.20 of foreign operating corporations shall not be included in
the net income or the apportionment factors of the unitary business except as provided in
paragraph (g).

(g) The adjusted net income of a foreign operating corporation shall be deemed to
be paid as a dividend on the last day of its taxable year to each shareholder thereof, in
proportion to each shareholder's ownership, with which such corporation is engaged in
a unitary business. Such deemed dividend shall be treated as a dividend under section
290.21, subdivision 4.

Dividends actually paid by a foreign operating corporation to a corporate shareholder
which is a member of the same unitary business as the foreign operating corporation shall
be eliminated from the net income of the unitary business in preparing a combined report
for the unitary business. The adjusted net income of a foreign operating corporation
shall be its net income adjusted as follows:

(1) any taxes paid or accrued to a foreign country, the commonwealth of Puerto
Rico, or a United States possession or political subdivision of any of the foregoing shall
be a deduction; and

(2) the subtraction from federal taxable income for payments received from foreign
corporations or foreign operating corporations under section 290.01, subdivision 19d,
clause (10), shall not be allowed.

If a foreign operating corporation incurs a net loss, neither income nor deduction
from that corporation shall be included in determining the net income of the unitary
business.

(h) For purposes of determining the net income of a unitary business and the factors
to be used in the apportionment of net income pursuant to section 290.191 or 290.20, there
must be included only the income and apportionment factors of domestic corporations or
other domestic entities other than foreign operating corporations that are determined to
be part of the unitary business pursuant to this subdivision, notwithstanding that foreign
corporations or other foreign entities might be included in the unitary business.

(i) Deductions for expenses, interest, or taxes otherwise allowable under this chapter
that are connected with or allocable against dividends, deemed dividends described
in paragraph (g), or royalties, fees, or other like income described in section 290.01,
subdivision 19d
, clause (10), shall not be disallowed.

(j) Each corporation or other entity, except a sole proprietorship, that is part of a
unitary business must file combined reports as the commissioner determines. On the
reports, all intercompany transactions between entities included pursuant to paragraph
(h) must be eliminated and the entire net income of the unitary business determined in
accordance with this subdivision is apportioned among the entities by using each entity's
Minnesota factors for apportionment purposes in the numerators of the apportionment
formula and the total factors for apportionment purposes of all entities included pursuant
to paragraph (h) in the denominators of the apportionment formula.

(k) If a corporation has been divested from a unitary business and is included in a
combined report for a fractional part of the common accounting period of the combined
report:

(1) its income includable in the combined report is its income incurred for that part
of the year determined by proration or separate accounting; and

(2) its sales, property, and payroll included in the apportionment formula must
be prorated or accounted for separately.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

ARTICLE 2

DEPARTMENT POLICY AND TECHNICAL: ESTATE TAXES

Section 1.

Minnesota Statutes 2010, section 289A.10, is amended by adding a
subdivision to read:


new text begin Subd. 1a. new text end

new text begin Recapture tax return required. new text end

new text begin If a disposition or cessation as provided
by section 291.03, subdivision 11, paragraph (a), has occurred, the qualified heir, as
defined under section 291.03, subdivision 8, paragraph (c), or personal representative of
the decedent's estate must submit a recapture tax return to the commissioner.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for estates of decedents dying after
June 30, 2011.
new text end

Sec. 2.

Minnesota Statutes 2010, section 289A.12, is amended by adding a subdivision
to read:


new text begin Subd. 18. new text end

new text begin Returns by qualified heirs. new text end

new text begin Within 24 months and within 36 months
after a decedent's death, a qualified heir, as defined under section 291.03, subdivision 8,
paragraph (c), must file a return with the commissioner relating to the qualified property
received from the decedent.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for estates of decedents dying after
June 30, 2011.
new text end

Sec. 3.

Minnesota Statutes 2010, section 289A.18, is amended by adding a subdivision
to read:


new text begin Subd. 3a. new text end

new text begin Recapture tax return. new text end

new text begin A recapture tax return is due within six months
after the date of the disposition or cessation as provided by section 291.03, subdivision
11, paragraph (a).
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for estates of decedents dying after
June 30, 2011.
new text end

Sec. 4.

Minnesota Statutes 2010, section 289A.20, subdivision 3, is amended to read:


Subd. 3.

Estate tax.

Taxes imposed by deleted text begin chapter 291deleted text end new text begin section 291.03, subdivision 1,new text end
take effect at and upon the death of the person whose estate is subject to taxation and are
due and payable on or before the expiration of nine months from that death.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for estates of decedents dying after
June 30, 2011.
new text end

Sec. 5.

Minnesota Statutes 2010, section 289A.20, is amended by adding a subdivision
to read:


new text begin Subd. 3a. new text end

new text begin Recapture tax. new text end

new text begin Taxes imposed by section 291.03, subdivision 11,
paragraph (b), are due and payable on or before the expiration of six months from the date
of disposition or cessation as provided by section 291.03, subdivision 11, paragraph (a).
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for estates of decedents dying after
June 30, 2011.
new text end

Sec. 6.

Minnesota Statutes 2011 Supplement, section 291.03, subdivision 8, is
amended to read:


Subd. 8.

Definitions.

(a) For purposes of this section, the following terms have the
meanings given in this subdivision.

(b) "Family member" means a family member as defined in section 2032A(e)(2) of
the Internal Revenue Codenew text begin or a trust whose present beneficiaries are all family members as
defined in section 2032A(e)(2) of the Internal Revenue Code
new text end .

(c) "Qualified heir" means a family member who acquired qualified property deleted text begin fromdeleted text end new text begin
upon the death of
new text end the decedent and satisfies the requirement under subdivision 9, clause
deleted text begin (6)deleted text end new text begin (8)new text end , or subdivision 10, clause deleted text begin (4)deleted text end new text begin (5)new text end , for the property.

(d) "Qualified property" means qualified small business property under subdivision
9 and qualified farm property under subdivision 10.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for estates of decedents dying after
June 30, 2011.
new text end

Sec. 7.

Minnesota Statutes 2011 Supplement, section 291.03, subdivision 9, is
amended to read:


Subd. 9.

Qualified small business property.

Property satisfying all of the following
requirements is qualified small business property:

(1) The value of the property was included in the federal adjusted taxable estate.

(2) The property consists of the assets of a trade or business or shares of stock or
other ownership interests in a corporation or other entity engaged in a trade or business.
deleted text begin The decedent or the decedent's spouse must have materially participated in the trade or
business within the meaning of section 469 of the Internal Revenue Code during the
taxable year that ended before the date of the decedent's death.
deleted text end Shares of stock in a
corporation or an ownership interest in another type of entity do not qualify under this
subdivision if the shares or ownership interests are traded on a public stock exchange at
any time during the three-year period ending on the decedent's date of death. new text begin For purposes
of this subdivision, an ownership interest includes those interests the decedent is deemed
to own pursuant to sections 2036, 2037, and 2038 of the Internal Revenue Code.
new text end

new text begin (3) During the decedent's taxable year that ended before the decedent's death, the
trade or business must not have been a passive activity within the meaning of section
469(c) of the Internal Revenue Code and the decedent or decedent's spouse must have
materially participated in the trade or business within the meaning of section 469(h) of the
Internal Revenue Code, excluding section 469(h)(3) of the Internal Revenue Code and
any other provision provided by Treasury Department regulation that substitutes material
participation in prior taxable years for material participation in the taxable year that ended
before the decedent's death.
new text end

deleted text begin (3)deleted text end new text begin (4)new text end The gross annual sales of the trade or business were $10,000,000 or less for
the last taxable year that ended before the date of the death of the decedent.

deleted text begin (4)deleted text end new text begin (5)new text end The property does not consist of cash deleted text begin ordeleted text end new text begin ,new text end cash equivalentsnew text begin , publicly traded
securities, or assets not used in the operation of the trade or business
new text end . For property
consisting of shares of stock or other ownership interests in an entity, the deleted text begin amountdeleted text end new text begin valuenew text end of
cash deleted text begin ordeleted text end new text begin ,new text end cash equivalentsnew text begin , publicly traded securities, or assets not used in the operation of
the trade or business
new text end held by the corporation or other entity must be deducted from the
value of the property qualifying under this subdivision in proportion to the decedent's
share of ownership of the entity on the date of death.

new text begin (6) The property does not consist of agricultural land as defined by section 500.24,
subdivision 2, paragraph (g). For property consisting of shares of stock or other ownership
interests in an entity, the value of agricultural land held by the corporation or other entity
must be deducted from the value of the property qualifying under this subdivision in
proportion to the decedent's share of ownership of the entity on the date of death.
new text end

deleted text begin (5)deleted text end new text begin (7)new text end The decedent continuously owned the propertynew text begin , including property the
decedent is deemed to own pursuant to sections 2036, 2037, and 2038 of the Internal
Revenue Code,
new text end for the three-year period ending on the date of death of the decedent.new text begin In
the case of a sole proprietor, if the property replaced similar property within the three-year
period, the replacement property will be treated as having been owned for the three-year
period ending on the date of death of the decedent.
new text end

deleted text begin (6) A family member continuously uses the property in the operation of the trade or
business for three years following the date of death of the decedent.
deleted text end

new text begin (8) For three years following the date of death of the decedent, the trade or business
is not a passive activity within the meaning of section 469(c) of the Internal Revenue
Code and a family member materially participates in the operation of the trade or business
within the meaning of section 469(h) of the Internal Revenue Code, excluding section
469(h)(3) of the Internal Revenue Code and any other provision provided by Treasury
Department regulation that substitutes material participation in prior taxable years for
material participation in the three years following the date of death of the decedent.
new text end

deleted text begin (7)deleted text end new text begin (9)new text end The estate and the qualified heir elect to treat the property as qualified small
business property and agree, in the form prescribed by the commissioner, to pay the
recapture tax under subdivision 11, if applicable.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for estates of decedents dying after
June 30, 2011.
new text end

Sec. 8.

Minnesota Statutes 2011 Supplement, section 291.03, subdivision 10, is
amended to read:


Subd. 10.

Qualified farm property.

Property satisfying all of the following
requirements is qualified farm property:

(1) The value of the property was included in the federal adjusted taxable estate.

(2) The property consists ofnew text begin agricultural land as defined by section 500.24,
subdivision 2, paragraph (g), and owned by
new text end a deleted text begin farm meeting the requirements ofdeleted text end new text begin person
or entity that is not excluded from owning agricultural land by
new text end section 500.24deleted text begin , and was
classified for property tax purposes as the homestead of the decedent or the decedent's
spouse or both under section 273.124, and as class 2a property under section 273.13,
subdivision 23
deleted text end .

(3) deleted text begin The decedent continuously owned thedeleted text end new text begin For new text end property deleted text begin fordeleted text end new text begin taxes payable in new text end the
deleted text begin three-year period ending on the datedeleted text end new text begin yearnew text end of new text begin the decedent's new text end death deleted text begin ofdeleted text end new text begin ,new text end the deleted text begin decedentdeleted text end new text begin property
was classified for property tax purposes as the homestead of the decedent or the decedent's
spouse or both under section 273.124, and as class 2a property under section 273.13,
subdivision 23
new text end .

(4) deleted text begin A family memberdeleted text end new text begin The decedent new text end continuously deleted text begin uses the property in the operation
of the trade or business
deleted text end new text begin owned the property, including property the decedent is deemed
to own pursuant to sections 2036, 2307, and 2308 of the Internal Revenue Code, for the
three-year period ending on the date of death of the decedent, either by ownership of the
agricultural land or pursuant to holding an interest in an entity that is not excluded from
owning agricultural land by section 500.24.
new text end

new text begin (5) The property is classified for property tax purposes as class 2a property under
section 273.13, subdivision 23,
new text end for three years following the date of death of the decedent.

deleted text begin (5)deleted text end new text begin (6)new text end The estate and the qualified heir elect to treat the property as qualified farm
property and agree, in a form prescribed by the commissioner, to pay the recapture tax
under subdivision 11, if applicable.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for estates of decedents dying after
June 30, 2011.
new text end

Sec. 9.

Minnesota Statutes 2011 Supplement, section 291.03, subdivision 11, is
amended to read:


Subd. 11.

Recapture tax.

(a) If, within three years after the decedent's death and
before the death of the qualified heir, the qualified heir disposes of any interest in the
qualified property, other than by a disposition to a family member, or a family member
ceases to deleted text begin use the qualified property which was acquired or passed from the decedentdeleted text end new text begin
satisfy the requirement under subdivision 9, clause (8); or 10, clause (5)
new text end , an additional
estate tax is imposed on the property.new text begin In the case of a sole proprietor, if the qualified heir
replaces qualified small business property excluded under subdivision 9 with similar
property, then the qualified heir will not be treated as having disposed of an interest in the
qualified property.
new text end

(b) The amount of the additional tax equals the amount of the exclusion claimed by
the estate under subdivision 8, paragraph (d), multiplied by 16 percent.

deleted text begin (c) The additional tax under this subdivision is due on the day which is six months
after the date of the disposition or cessation in paragraph (a).
deleted text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for estates of decedents dying after
June 30, 2011.
new text end

ARTICLE 3

DEPARTMENT POLICY AND TECHNICAL: PROPERTY TAX

Section 1.

Minnesota Statutes 2010, section 13.4965, subdivision 3, is amended to read:


Subd. 3.

Homestead new text begin and other new text end applications.

The classification and disclosure of
certain information collected to determine new text begin eligibility of property for a new text end homestead new text begin or other
new text end classificationnew text begin or benefit under section 273.13new text end are governed by deleted text begin sectiondeleted text end new text begin sectionsnew text end 273.124,
deleted text begin subdivisiondeleted text end new text begin subdivisionsnew text end 13new text begin , 13a, 13c, and 13d, and 273.1315new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 2.

Minnesota Statutes 2010, section 270.077, is amended to read:


270.077 TAXES CREDITED TO STATE AIRPORTS FUND.

All taxes levied under sections 270.071 to 270.079 must benew text begin collected by the
commissioner and
new text end credited to the state airports fund created in section 360.017.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for reports filed on July 1, 2012,
and thereafter.
new text end

Sec. 3.

Minnesota Statutes 2010, section 270.41, subdivision 5, is amended to read:


Subd. 5.

Prohibited activity.

A licensed assessor or other person employed by an
assessment jurisdiction or contracting with an assessment jurisdiction for the purpose
of valuing or classifying property for property tax purposes is prohibited from making
appraisals or analyses, accepting an appraisal assignment, or preparing an appraisal report
as defined in section 82B.021, subdivisions 2, 4, 6, and 7, on any property within the
assessment jurisdiction where the individual is employed or performing the duties of the
assessor under contract. Violation of this prohibition shall result in immediate revocation
of the individual's license to assess property for property tax purposes. This prohibition
must not be construed to prohibit an individual from carrying out any duties required
for the proper assessment of property for property tax purposes or performing duties
enumerated in section 273.061, subdivision 7 or 8. If a formal resolution has been adopted
by the governing body of a governmental unit, which specifies the purposes for which
such work will be done, this prohibition does not apply to appraisal activities undertaken
on behalf of and at the request of the governmental unit that has employed or contracted
with the individual. The resolution may only allow appraisal activities which are related to
condemnations, right-of-way acquisitions,new text begin land exchanges,new text end or special assessments.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 4.

Minnesota Statutes 2011 Supplement, section 270C.34, subdivision 1, is
amended to read:


Subdivision 1.

Authority.

(a) The commissioner may abate, reduce, or refund any
penalty or interest that is imposed by a law administered by the commissioner, or imposed
by section 270.0725, subdivision 1 or 2, new text begin or 270.075, new text end as a result of the late payment of tax
or late filing of a return, or any part of an additional tax charge under section 289A.25,
subdivision 2
, or 289A.26, subdivision 4, if the failure to timely pay the tax or failure
to timely file the return is due to reasonable cause, or if the taxpayer is located in a
presidentially declared disaster or in a presidentially declared state of emergency area or
in an area declared to be in a state of emergency by the governor under section 12.31.

(b) The commissioner shall abate any part of a penalty or additional tax charge
under section 289A.25, subdivision 2, or 289A.26, subdivision 4, attributable to erroneous
advice given to the taxpayer in writing by an employee of the department acting in
an official capacity, if the advice:

(1) was reasonably relied on and was in response to a specific written request of the
taxpayer; and

(2) was not the result of failure by the taxpayer to provide adequate or accurate
information.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 5.

Minnesota Statutes 2010, section 272.01, subdivision 2, is amended to read:


Subd. 2.

Exempt property used by private entity for profit.

(a) When any real or
personal property which is exempt from ad valorem taxes, and taxes in lieu thereof, is
leased, loaned, or otherwise made available and used by a private individual, association,
or corporation in connection with a business conducted for profit, there shall be imposed a
tax, for the privilege of so using or possessing such real or personal property, in the same
amount and to the same extent as though the lessee or user was the owner of such property.

(b) The tax imposed by this subdivision shall not apply to:

(1) property leased or used as a concession in or relative to the use in whole
or part of a public park, market, fairgrounds, port authority, economic development
authority established under chapter 469, municipal auditorium, municipal parking facility,
municipal museum, or municipal stadium;

(2) property of an airport owned by a city, town, county, or group thereof which is:

(i) leased to or used by any person or entity including a fixed base operator; and

(ii) used as a hangar for the storage or repair of aircraft or to provide aviation goods,
services, or facilities to the airport or general public;

the exception from taxation provided in this clause does not apply to:

(i) property located at an airport owned or operated by the Metropolitan Airports
Commission or by a city of over 50,000 population according to the most recent federal
census or such a city's airport authority; or

(ii) hangars leased by a private individual, association, or corporation in connection
with a business conducted for profit other than an aviation-related business;

(3) property constituting or used as a public pedestrian ramp or concourse in
connection with a public airport;

(4) property constituting or used as a passenger check-in area or ticket sale counter,
boarding area, or luggage claim area in connection with a public airport but not the
airports owned or operated by the Metropolitan Airports Commission or cities of over
50,000 population or an airport authority therein. Real estate owned by a municipality
in connection with the operation of a public airport and leased or used for agricultural
purposes is not exempt;

(5) property leased, loaned, or otherwise made available to a private individual,
corporation, or association under a cooperative farming agreement made pursuant to
section 97A.135; or

(6) property leased, loaned, or otherwise made available to a private individual,
corporation, or association under section 272.68, subdivision 4.

(c) Taxes imposed by this subdivision are payable as in the case of personal property
taxes and shall be assessed to the lessees or users of real or personal property in the same
manner as taxes assessed to owners of real or personal property, except that such taxes
shall not become a lien against the property. When due, the taxes shall constitute a debt
due from the lessee or user to the state, township, city, county, and school district for
which the taxes were assessed and shall be collected in the same manner as personal
property taxes. If property subject to the tax imposed by this subdivision is leased or used
jointly by two or more persons, each lessee or user shall be jointly and severally liable for
payment of the tax.

(d) The tax on real property of thenew text begin federal government, thenew text end state or any of its political
subdivisions that is leased by a private individual, association, or corporation and becomes
taxable under this subdivision or other provision of law must be assessed and collected as
a personal property assessment. The taxes do not become a lien against the real property.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 6.

Minnesota Statutes 2010, section 272.03, subdivision 9, is amended to read:


Subd. 9.

Person.

"Person" deleted text begin includesdeleted text end new text begin means an individual, association, estate, trust,
partnership,
new text end firm, company, or corporation.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 7.

Minnesota Statutes 2011 Supplement, section 273.114, subdivision 6, is
amended to read:


Subd. 6.

Additional taxes.

new text begin (a) new text end When real property which is being, or has been
valued and assessed under this section new text begin is sold, transferred, or new text end no longer qualifies under
subdivision 2, the portionnew text begin sold, transferred, ornew text end no longer qualifying shall be subject to
additional taxes in the amount equal to the difference between the taxes determined in
accordance with subdivision 3 and the amount determined under subdivision 4, provided
that the amount determined under subdivision 4 shall not be greater than it would have
been had the actual bona fide sale price of the real property at an arm's-length transaction
been used in lieu of the market value determined under subdivision 4. The additional taxes
shall be extended against the property on the tax list fornew text begin taxes payable innew text end the current year,
provided that no interest or penalties shall be levied on the additional taxes if timely paid
andnew text begin providednew text end that the additional taxes shall only be levied with respect to the current year
plus two prior years that the property has been valued and assessed under this section.

new text begin (b) In the case of a sale or transfer, the additional taxes under paragraph (a) shall not
be extended against the property if the new owner submits a successful application by the
later of May 1 of the current year or 30 days after the sale or transfer.
new text end

new text begin (c) For the purposes of this section, the following events do not constitute a sale or
transfer for property that qualified under subdivision 2 prior to the event:
new text end

new text begin (1) death of a property owner when the surviving owners retain ownership of the
property;
new text end

new text begin (2) divorce of a married couple when one of the spouses retains ownership of the
property;
new text end

new text begin (3) marriage of a single property owner when that owner retains ownership of the
property in whole or in part;
new text end

new text begin (4) the organization or reorganization of a farm ownership entity that is not prohibited
from owning agricultural land in this state under section 500.24, if all owners maintain the
same beneficial interest both before and after the organization or reorganization; and
new text end

new text begin (5) transfer of the property to a trust or trustee, provided that the individual owners
of the property are the grantors of the trust and they maintain the same beneficial interest
both before and after placement of the property in trust.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 8.

Minnesota Statutes 2010, section 273.124, subdivision 13, is amended to read:


Subd. 13.

Homestead application.

(a) A person who meets the homestead
requirements under subdivision 1 must file a homestead application with the county
assessor to initially obtain homestead classification.

(b) The format and contents of a uniform homestead application shall be prescribed
by the commissioner of revenue. The application must clearly inform the taxpayer that
this application must be signed by all owners who occupy the property or by the qualifying
relative and returned to the county assessor in order for the property to receive homestead
treatment.

(c) Every property owner applying for homestead classification must furnish to the
county assessor the Social Security number of each occupant who is listed as an owner
of the property on the deed of record, the name and address of each owner who does not
occupy the property, and the name and Social Security number of each owner's spouse who
occupies the property. The application must be signed by each owner who occupies the
property and by each owner's spouse who occupies the property, or, in the case of property
that qualifies as a homestead under subdivision 1, paragraph (c), by the qualifying relative.

If a property owner occupies a homestead, the property owner's spouse may not
claim another property as a homestead unless the property owner and the property owner's
spouse file with the assessor an affidavit or other proof required by the assessor stating that
the property qualifies as a homestead under subdivision 1, paragraph (e).

Owners or spouses occupying residences owned by their spouses and previously
occupied with the other spouse, either of whom fail to include the other spouse's name
and Social Security number on the homestead application or provide the affidavits or
other proof requested, will be deemed to have elected to receive only partial homestead
treatment of their residence. The remainder of the residence will be classified as
nonhomestead residential. When an owner or spouse's name and Social Security number
appear on homestead applications for two separate residences and only one application is
signed, the owner or spouse will be deemed to have elected to homestead the residence for
which the application was signed.

The Social Security numbers, state or federal tax returns or tax return information,
including the federal income tax schedule Fnew text begin ,new text end required by this sectiondeleted text begin ,deleted text end ornew text begin section 273.13,
and
new text end affidavits or other proofs of the property owners and spouses submitted under this
or another section to support a claim for a property tax homestead classificationnew text begin or other
classification or benefit under section 273.13,
new text end are private data on individuals as defined by
section 13.02, subdivision 12,new text begin or nonpublic data as defined in section 13.02, subdivision 9,new text end
but, notwithstanding that section, the privatenew text begin and nonpublicnew text end data may be disclosed to the
commissioner of revenue, or, for purposes of proceeding under the Revenue Recapture
Act to recover personal property taxes owing, to the county treasurer.

(d) If residential real estate is occupied and used for purposes of a homestead by a
relative of the owner and qualifies for a homestead under subdivision 1, paragraph (c), in
order for the property to receive homestead status, a homestead application must be filed
with the assessor. The Social Security number of each relative and spouse of a relative
occupying the property shall be required on the homestead application filed under this
subdivision. If a different relative of the owner subsequently occupies the property, the
owner of the property must notify the assessor within 30 days of the change in occupancy.
The Social Security number of a relative or relative's spouse occupying the property
is private data on individuals as defined by section 13.02, subdivision 12, but may be
disclosed to the commissioner of revenue, or, for the purposes of proceeding under the
Revenue Recapture Act to recover personal property taxes owing, to the county treasurer.

(e) The homestead application shall also notify the property owners that deleted text begin the
application filed under this section will not be mailed annually and that
deleted text end if the property
is granted homestead status for any assessment year, that same property shall remain
classified as homestead until the property is sold or transferred to another person, or
the owners, the spouse of the owner, or the relatives no longer use the property as their
homestead. Upon the sale or transfer of the homestead property, a certificate of value must
be timely filed with the county auditor as provided under section 272.115. Failure to
notify the assessor within 30 days that the property has been sold, transferred, or that the
owner, the spouse of the owner, or the relative is no longer occupying the property as a
homestead, shall result in the penalty provided under this subdivision and the property
will lose its current homestead status.

(f) deleted text begin If the homestead application is not returned within 30 days, the county will send a
second application to the present owners of record. The notice of proposed property taxes
prepared under section 275.065, subdivision 3, shall reflect the property's classification.
deleted text end If
a homestead application has not been filed with the county by December 15, the assessor
shall classify the property as nonhomestead for the current assessment year for taxes
payable in the following year, provided that the owner may be entitled to receive the
homestead classification by proper application under section 375.192.

new text begin Subd. 13a. new text end

new text begin Occupant list. new text end

deleted text begin (g)deleted text end At the request of the commissioner, each county
must give the commissioner a list that includes the name and Social Security number
of each occupant of homestead property who is the property owner, property owner's
spouse, qualifying relative of a property owner, or a spouse of a qualifying relative. The
commissioner shall use the information provided on the lists as appropriate under the law,
including for the detection of improper claims by owners, or relatives of owners, under
chapter 290A.

new text begin Subd. 13b. new text end

new text begin Improper homestead. new text end

deleted text begin (h)deleted text end new text begin (a)new text end If the commissioner finds that a
property owner may be claiming a fraudulent homestead, the commissioner shall notify
the appropriate counties. Within 90 days of the notification, the county assessor shall
investigate to determine if the homestead classification was properly claimed. If the
property owner does not qualify, the county assessor shall notify the county auditor who
will determine the amount of homestead benefits that had been improperly allowed. For the
purpose of this deleted text begin sectiondeleted text end new text begin subdivisionnew text end , "homestead benefits" means the tax reduction resulting
from the classification as a homestead under section 273.13, the taconite homestead credit
under section 273.135, the residential homestead and agricultural homestead credits under
section 273.1384, and the supplemental homestead credit under section 273.1391.

The county auditor shall send a notice to the person who owned the affected property
at the time the homestead application related to the improper homestead was filed,
demanding reimbursement of the homestead benefits plus a penalty equal to 100 percent
of the homestead benefits. The person notified may appeal the county's determination
by serving copies of a petition for review with county officials as provided in section
278.01 and filing proof of service as provided in section 278.01 with the Minnesota Tax
Court within 60 days of the date of the notice from the county. Procedurally, the appeal
is governed by the provisions in chapter 271 which apply to the appeal of a property tax
assessment or levy, but without requiring any prepayment of the amount in controversy. If
the amount of homestead benefits and penalty is not paid within 60 days, and if no appeal
has been filed, the county auditor shall certify the amount of taxes and penalty to the county
treasurer. The county treasurer will add interest to the unpaid homestead benefits and
penalty amounts at the rate provided in section 279.03 for real property taxes becoming
delinquent in the calendar year during which the amount remains unpaid. Interest may be
assessed for the period beginning 60 days after demand for payment was made.

If the person notified is the current owner of the property, the treasurer may add the
total amount of homestead benefits, penalty, interest, and costs to the ad valorem taxes
otherwise payable on the property by including the amounts on the property tax statements
under section 276.04, subdivision 3. The amounts added under this paragraph to the ad
valorem taxes shall include interest accrued through December 31 of the year preceding
the taxes payable year for which the amounts are first added. These amounts, when added
to the property tax statement, become subject to all the laws for the enforcement of real or
personal property taxes for that year, and for any subsequent year.

If the person notified is not the current owner of the property, the treasurer may
collect the amounts due under the Revenue Recapture Act in chapter 270A, or use any of
the powers granted in sections 277.20 and 277.21 without exclusion, to enforce payment
of the homestead benefits, penalty, interest, and costs, as if those amounts were delinquent
tax obligations of the person who owned the property at the time the application related
to the improperly allowed homestead was filed. The treasurer may relieve a prior owner
of personal liability for the homestead benefits, penalty, interest, and costs, and instead
extend those amounts on the tax lists against the property as provided in this paragraph
to the extent that the current owner agrees in writing. On all demands, billings, property
tax statements, and related correspondence, the county must list and state separately the
amounts of homestead benefits, penalty, interest and costs being demanded, billed or
assessed.

deleted text begin (i)deleted text end new text begin (b)new text end Any amount of homestead benefits recovered by the county from the property
owner shall be distributed to the county, city or town, and school district where the
property is located in the same proportion that each taxing district's levy was to the total
of the three taxing districts' levy for the current year. Any amount recovered attributable
to taconite homestead credit shall be transmitted to the St. Louis County auditor to be
deposited in the taconite property tax relief account. Any amount recovered that is
attributable to supplemental homestead credit is to be transmitted to the commissioner of
revenue for deposit in the general fund of the state treasury. The total amount of penalty
collected must be deposited in the county general fund.

deleted text begin (j)deleted text end new text begin (c)new text end If a property owner has applied for more than one homestead and the county
assessors cannot determine which property should be classified as homestead, the county
assessors will refer the information to the commissioner. The commissioner shall make
the determination and notify the counties within 60 days.

new text begin Subd. 13c. new text end

new text begin Property lists. new text end

deleted text begin (k)deleted text end In addition to lists of homestead properties, the
commissioner may ask the counties to furnish lists of all properties and the record owners.
The Social Security numbers and federal identification numbers that are maintained by
a county or city assessor for property tax administration purposes, and that may appear
on the lists retain their classification as private or nonpublic data; but may be viewed,
accessed, and used by the county auditor or treasurer of the same county for the limited
purpose of assisting the commissioner in the preparation of microdata samples under
section 270C.12.new text begin The commissioner shall use the information provided on the lists as
appropriate under the law, including for the detection of improper claims by owners, or
relatives of owners, under chapter 290A.
new text end

new text begin Subd. 13d. new text end

new text begin Homestead data. new text end

deleted text begin (l)deleted text end On or before April 30 each year beginning in 2007,
each county must provide the commissioner with the following data for each parcel of
homestead property by electronic means as defined in section 289A.02, subdivision 8:

deleted text begin (i)deleted text end new text begin (1)new text end the property identification number assigned to the parcel for purposes of
taxes payable in the current year;

deleted text begin (ii)deleted text end new text begin (2)new text end the name and Social Security number of each occupant of homestead property
who is the property owner, property owner's spouse, qualifying relative of a property
owner, or spouse of a qualifying relative;

deleted text begin (iii)deleted text end new text begin (3)new text end the classification of the property under section 273.13 for taxes payable
in the current year and in the prior year;

deleted text begin (iv)deleted text end new text begin (4)new text end an indication of whether the property was classified as a homestead for
taxes payable in the current year because of occupancy by a relative of the owner or
by a spouse of a relative;

deleted text begin (v)deleted text end new text begin (5)new text end the property taxes payable as defined in section 290A.03, subdivision 13, for
the current year and the prior year;

deleted text begin (vi)deleted text end new text begin (6)new text end the market value of improvements to the property first assessed for tax
purposes for taxes payable in the current year;

deleted text begin (vii)deleted text end new text begin (7)new text end the assessor's estimated market value assigned to the property for taxes
payable in the current year and the prior year;

deleted text begin (viii)deleted text end new text begin (8)new text end the taxable market value assigned to the property for taxes payable in the
current year and the prior year;

deleted text begin (ix)deleted text end new text begin (9)new text end whether there are delinquent property taxes owing on the homestead;

deleted text begin (x)deleted text end new text begin (10)new text end the unique taxing district in which the property is located; and

deleted text begin (xi)deleted text end new text begin (11)new text end such other information as the commissioner decides is necessary.

The commissioner shall use the information provided on the lists as appropriate
under the law, including for the detection of improper claims by owners, or relatives
of owners, under chapter 290A.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 9.

Minnesota Statutes 2011 Supplement, section 273.13, subdivision 23, is
amended to read:


Subd. 23.

Class 2.

(a) An agricultural homestead consists of class 2a agricultural
land that is homesteaded, along with any class 2b rural vacant land that is contiguous to
the class 2a land under the same ownership. The market value of the house and garage
and immediately surrounding one acre of land has the same class rates as class 1a or 1b
property under subdivision 22. The value of the remaining land including improvements
up to the first tier valuation limit of agricultural homestead property has a net class rate
of 0.5 percent of market value. The remaining property over the first tier has a class rate
of one percent of market value. For purposes of this subdivision, the "first tier valuation
limit of agricultural homestead property" and "first tier" means the limit certified under
section 273.11, subdivision 23.

(b) Class 2a agricultural land consists of parcels of property, or portions thereof, that
are agricultural land and buildings. Class 2a property has a net class rate of one percent of
market value, unless it is part of an agricultural homestead under paragraph (a). Class
2a property must also include any property that would otherwise be classified as 2b,
but is interspersed with class 2a property, including but not limited to sloughs, wooded
wind shelters, acreage abutting ditches, ravines, rock piles, land subject to a setback
requirement, and other similar land that is impractical for the assessor to value separately
from the rest of the property or that is unlikely to be able to be sold separately from
the rest of the property.

An assessor may classify the part of a parcel described in this subdivision that is used
for agricultural purposes as class 2a and the remainder in the class appropriate to its use.

(c) Class 2b rural vacant land consists of parcels of property, or portions thereof,
that are unplatted real estate, rural in character and not used for agricultural purposes,
including land used for growing trees for timber, lumber, and wood and wood products,
that is not improved with a structure. The presence of a minor, ancillary nonresidential
structure as defined by the commissioner of revenue does not disqualify the property from
classification under this paragraph. Any parcel of 20 acres or more improved with a
structure that is not a minor, ancillary nonresidential structure must be split-classified, and
ten acres must be assigned to the split parcel containing the structure. Class 2b property
has a net class rate of one percent of market value unless it is part of an agricultural
homestead under paragraph (a), or qualifies as class 2c under paragraph (d).

(d) Class 2c managed forest land consists of no less than 20 and no more than 1,920
acres statewide per taxpayer that is being managed under a forest management plan that
meets the requirements of chapter 290C, but is not enrolled in the sustainable forest
resource management incentive program. It has a class rate of .65 percent, provided that
the owner of the property must apply to the assessor in order for the property to initially
qualify for the reduced rate and provide the information required by the assessor to verify
that the property qualifies for the reduced rate. If the assessor receives the application
and information before May 1 in an assessment year, the property qualifies beginning
with that assessment year. If the assessor receives the application and information after
April 30 in an assessment year, the property may not qualify until the next assessment
year. The commissioner of natural resources must concur that the land is qualified. The
commissioner of natural resources shall annually provide county assessors verification
information on a timely basis. The presence of a minor, ancillary nonresidential structure
as defined by the commissioner of revenue does not disqualify the property from
classification under this paragraph.

(e) Agricultural land as used in this section meansnew text begin :
new text end

new text begin (1)new text end contiguous acreage of ten acres or more, used during the preceding year for
agricultural purposesnew text begin ; or
new text end

new text begin (2) contiguous acreage used during the preceding year for an intensive livestock or
poultry confinement operation, provided that land used only for pasturing or grazing
does not qualify under this clause
new text end .

"Agricultural purposes" as used in this section means the raising, cultivation, drying,
or storage of agricultural products for sale, or the storage of machinery or equipment
used in support of agricultural production by the same farm entity. For a property to be
classified as agricultural based only on the drying or storage of agricultural products,
the products being dried or stored must have been produced by the same farm entity as
the entity operating the drying or storage facility. "Agricultural purposes" also includes
enrollment in the Reinvest in Minnesota program under sections 103F.501 to 103F.535 or
the federal Conservation Reserve Program as contained in Public Law 99-198 or a similar
state or federal conservation program if the property was classified as agricultural (i)
under this subdivision deleted text begin for the assessment year 2002deleted text end new text begin for taxes payable in 2003 because of
its enrollment in a qualifying program and the land remains enrolled
new text end or (ii) in the year
prior to its enrollment. Agricultural classification shall not be based upon the market value
of any residential structures on the parcel or contiguous parcels under the same ownership.

new text begin For purposes of this paragraph, "contiguous acreage" means all of, or a contiguous
portion of, a tax parcel as defined in section 272.193, or all of, or a contiguous portion of,
a set of contiguous tax parcels under section 272.193 that are owned by the same person.
new text end

(f) deleted text begin Real estate ofdeleted text end new text begin Agricultural land under this section also includes:
new text end

new text begin (1) contiguous acreage that isnew text end less than ten acresdeleted text begin , which isdeleted text end new text begin in size andnew text end exclusively deleted text begin or
intensively
deleted text end used new text begin in the preceding year new text end for raising or cultivating agricultural productsdeleted text begin , shall
be considered as agricultural land. To qualify under this paragraph, property that includes
a residential structure must be used intensively for one of the following purposes
deleted text end new text begin ; or
new text end

new text begin (2) contiguous acreage that contains a residence and is less than 11 acres in size, if
the contiguous acreage was used in the preceding year for one or more of the following
three uses
new text end :

(i) for new text begin an intensive grain new text end drying or storage deleted text begin of graindeleted text end new text begin operation,new text end or new text begin for intensive
machinery or equipment
new text end storage deleted text begin of machinery or equipmentdeleted text end new text begin activitiesnew text end used to support
agricultural activities new text begin conducted new text end on other parcels of property operated by the same deleted text begin farming
entity
deleted text end new text begin personnew text end ;

(ii) as a nursery, provided that only those acres used new text begin intensively new text end to produce nursery
stock are considered agricultural land;new text begin or
new text end

deleted text begin (iii) for livestock or poultry confinement, provided that land that is used only for
pasturing and grazing does not qualify; or
deleted text end

deleted text begin (iv)deleted text end new text begin (iii) new text end for new text begin intensive new text end market farming; for purposes of this paragraph, "market
farming" means the cultivation of one or more fruits or vegetables or production of animal
or other agricultural products for sale to local markets by the farmer or an organization
with which the farmer is affiliated.

new text begin For purposes of this paragraph, "contiguous acreage" means all of a tax parcel as defined
in section 272.193, or, all of a set of contiguous tax parcels under section 272.193 that
are owned by the same person.
new text end

(g) Land shall be classified as agricultural even if all or a portion of the agricultural
use of that property is the leasing to, or use by another person for agricultural purposes.

Classification under this subdivision is not determinative for qualifying under
section 273.111.

(h) The property classification under this section supersedes, for property tax
purposes only, any locally administered agricultural policies or land use restrictions that
define minimum or maximum farm acreage.

(i) The term "agricultural products" as used in this subdivision includes production
for sale of:

(1) livestock, dairy animals, dairy products, poultry and poultry products, fur-bearing
animals, horticultural and nursery stock, fruit of all kinds, vegetables, forage, grains,
bees, and apiary products by the owner;

(2) fish bred for sale and consumption if the fish breeding occurs on land zoned
for agricultural use;

(3) the commercial boarding of horses, which may include related horse training and
riding instruction, if the boarding is done on property that is also used for raising pasture
to graze horses or raising or cultivating other agricultural products as defined in clause (1);

(4) property which is owned and operated by nonprofit organizations used for
equestrian activities, excluding racing;

(5) game birds and waterfowl bred and raised (i) on a game farm licensed under
section 97A.105, provided that the annual licensing report to the Department of Natural
Resources, which must be submitted annually by March 30 to the assessor, indicates
that at least 500 birds were raised or used for breeding stock on the property during the
preceding year and that the owner provides a copy of the owner's most recent schedule F;
or (ii) for use on a shooting preserve licensed under section 97A.115;

(6) insects primarily bred to be used as food for animals;

(7) trees, grown for sale as a crop, including short rotation woody crops, and not
sold for timber, lumber, wood, or wood products; and

(8) maple syrup taken from trees grown by a person licensed by the Minnesota
Department of Agriculture under chapter 28A as a food processor.

(j) If a parcel used for agricultural purposes is also used for commercial or industrial
purposes, including but not limited to:

(1) wholesale and retail sales;

(2) processing of raw agricultural products or other goods;

(3) warehousing or storage of processed goods; and

(4) office facilities for the support of the activities enumerated in clauses (1), (2),
and (3),

the assessor shall classify the part of the parcel used for agricultural purposes as class
1b, 2a, or 2b, whichever is appropriate, and the remainder in the class appropriate to its
use. The grading, sorting, and packaging of raw agricultural products for first sale is
considered an agricultural purpose. A greenhouse or other building where horticultural
or nursery products are grown that is also used for the conduct of retail sales must be
classified as agricultural if it is primarily used for the growing of horticultural or nursery
products from seed, cuttings, or roots and occasionally as a showroom for the retail sale of
those products. Use of a greenhouse or building only for the display of already grown
horticultural or nursery products does not qualify as an agricultural purpose.

(k) The assessor shall determine and list separately on the records the market value
of the homestead dwelling and the one acre of land on which that dwelling is located. If
any farm buildings or structures are located on this homesteaded acre of land, their market
value shall not be included in this separate determination.

(l) Class 2d airport landing area consists of a landing area or public access area of
a privately owned public use airport. It has a class rate of one percent of market value.
To qualify for classification under this paragraph, a privately owned public use airport
must be licensed as a public airport under section 360.018. For purposes of this paragraph,
"landing area" means that part of a privately owned public use airport properly cleared,
regularly maintained, and made available to the public for use by aircraft and includes
runways, taxiways, aprons, and sites upon which are situated landing or navigational aids.
A landing area also includes land underlying both the primary surface and the approach
surfaces that comply with all of the following:

(i) the land is properly cleared and regularly maintained for the primary purposes of
the landing, taking off, and taxiing of aircraft; but that portion of the land that contains
facilities for servicing, repair, or maintenance of aircraft is not included as a landing area;

(ii) the land is part of the airport property; and

(iii) the land is not used for commercial or residential purposes.

The land contained in a landing area under this paragraph must be described and certified
by the commissioner of transportation. The certification is effective until it is modified,
or until the airport or landing area no longer meets the requirements of this paragraph.
For purposes of this paragraph, "public access area" means property used as an aircraft
parking ramp, apron, or storage hangar, or an arrival and departure building in connection
with the airport.

(m) Class 2e consists of land with a commercial aggregate deposit that is not actively
being mined and is not otherwise classified as class 2a or 2b, provided that the land is not
located in a county that has elected to opt-out of the aggregate preservation program as
provided in section 273.1115, subdivision 6. It has a class rate of one percent of market
value. To qualify for classification under this paragraph, the property must be at least
ten contiguous acres in size and the owner of the property must record with the county
recorder of the county in which the property is located an affidavit containing:

(1) a legal description of the property;

(2) a disclosure that the property contains a commercial aggregate deposit that is not
actively being mined but is present on the entire parcel enrolled;

(3) documentation that the conditional use under the county or local zoning
ordinance of this property is for mining; and

(4) documentation that a permit has been issued by the local unit of government
or the mining activity is allowed under local ordinance. The disclosure must include a
statement from a registered professional geologist, engineer, or soil scientist delineating
the deposit and certifying that it is a commercial aggregate deposit.

For purposes of this section and section 273.1115, "commercial aggregate deposit"
means a deposit that will yield crushed stone or sand and gravel that is suitable for use
as a construction aggregate; and "actively mined" means the removal of top soil and
overburden in preparation for excavation or excavation of a commercial deposit.

(n) When any portion of the property under this subdivision or subdivision 22 begins
to be actively mined, the owner must file a supplemental affidavit within 60 days from
the day any aggregate is removed stating the number of acres of the property that is
actively being mined. The acres actively being mined must be (1) valued and classified
under subdivision 24 in the next subsequent assessment year, and (2) removed from the
aggregate resource preservation property tax program under section 273.1115, if the
land was enrolled in that program. Copies of the original affidavit and all supplemental
affidavits must be filed with the county assessor, the local zoning administrator, and the
Department of Natural Resources, Division of Land and Minerals. A supplemental
affidavit must be filed each time a subsequent portion of the property is actively mined,
provided that the minimum acreage change is five acres, even if the actual mining activity
constitutes less than five acres.

(o) The definitions prescribed by the commissioner under paragraphs (c) and (d) are
not rules and are exempt from the rulemaking provisions of chapter 14, and the provisions
in section 14.386 concerning exempt rules do not apply.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 10.

Minnesota Statutes 2011 Supplement, section 273.13, subdivision 25, is
amended to read:


Subd. 25.

Class 4.

(a) Class 4a is residential real estate containing four or more
units and used or held for use by the owner or by the tenants or lessees of the owner
as a residence for rental periods of 30 days or more, excluding property qualifying for
class 4d. Class 4a also includes hospitals licensed under sections 144.50 to 144.56, other
than hospitals exempt under section 272.02, and contiguous property used for hospital
purposes, without regard to whether the property has been platted or subdivided. The
market value of class 4a property has a class rate of 1.25 percent.

(b) Class 4b includes:

(1) residential real estate containing less than four units that does not qualify as class
4bb, other than seasonal residential recreational property;

(2) manufactured homes not classified under any other provision;

(3) a dwelling, garage, and surrounding one acre of property on a nonhomestead
farm classified under subdivision 23, paragraph (b) containing two or three units; and

(4) unimproved property that is classified residential as determined under subdivision
33.

The market value of class 4b property has a class rate of 1.25 percent.

(c) Class 4bb includesdeleted text begin :
deleted text end

deleted text begin (1)deleted text end nonhomestead residential real estate containing one unit, other than seasonal
residential recreational property; and

deleted text begin (2)deleted text end a single family dwelling, garage, and surrounding one acre of property on a
nonhomestead farm classified under subdivision 23, paragraph (b).

Class 4bb property has the same class rates as class 1a property under subdivision 22.

Property that has been classified as seasonal residential recreational property at
any time during which it has been owned by the current owner or spouse of the current
owner does not qualify for class 4bb.

(d) Class 4c property includes:

(1) except as provided in subdivision 22, paragraph (c), real and personal property
devoted to commercial temporary and seasonal residential occupancy for recreation
purposes, for not more than 250 days in the year preceding the year of assessment. For
purposes of this clause, property is devoted to a commercial purpose on a specific day
if any portion of the property is used for residential occupancy, and a fee is charged for
residential occupancy. Class 4c property under this clause must contain three or more
rental units. A "rental unit" is defined as a cabin, condominium, townhouse, sleeping room,
or individual camping site equipped with water and electrical hookups for recreational
vehicles. A camping pad offered for rent by a property that otherwise qualifies for class
4c under this clause is also class 4c under this clause regardless of the term of the rental
agreement, as long as the use of the camping pad does not exceed 250 days. In order for a
property to be classified under this clause, either (i) the business located on the property
must provide recreational activities, at least 40 percent of the annual gross lodging receipts
related to the property must be from business conducted during 90 consecutive days,
and either (A) at least 60 percent of all paid bookings by lodging guests during the year
must be for periods of at least two consecutive nights; or (B) at least 20 percent of the
annual gross receipts must be from charges for providing recreational activities, or (ii) the
business must contain 20 or fewer rental units, and must be located in a township or a city
with a population of 2,500 or less located outside the metropolitan area, as defined under
section 473.121, subdivision 2, that contains a portion of a state trail administered by the
Department of Natural Resources. For purposes of item (i)(A), a paid booking of five or
more nights shall be counted as two bookings. Class 4c property also includes commercial
use real property used exclusively for recreational purposes in conjunction with other class
4c property classified under this clause and devoted to temporary and seasonal residential
occupancy for recreational purposes, up to a total of two acres, provided the property is
not devoted to commercial recreational use for more than 250 days in the year preceding
the year of assessment and is located within two miles of the class 4c property with which
it is used. In order for a property to qualify for classification under this clause, the owner
must submit a declaration to the assessor designating the cabins or units occupied for 250
days or less in the year preceding the year of assessment by January 15 of the assessment
year. Those cabins or units and a proportionate share of the land on which they are located
must be designated class 4c under this clause as otherwise provided. The remainder of the
cabins or units and a proportionate share of the land on which they are located will be
designated as class 3a. The owner of property desiring designation as class 4c property
under this clause must provide guest registers or other records demonstrating that the units
for which class 4c designation is sought were not occupied for more than 250 days in the
year preceding the assessment if so requested. The portion of a property operated as a
(1) restaurant, (2) bar, (3) gift shop, (4) conference center or meeting room, and (5) other
nonresidential facility operated on a commercial basis not directly related to temporary and
seasonal residential occupancy for recreation purposes does not qualify for class 4c. For
the purposes of this paragraph, "recreational activities" means renting ice fishing houses,
boats and motors, snowmobiles, downhill or cross-country ski equipment; providing
marina services, launch services, or guide services; or selling bait and fishing tackle;

(2) qualified property used as a golf course if:

(i) it is open to the public on a daily fee basis. It may charge membership fees or
dues, but a membership fee may not be required in order to use the property for golfing,
and its green fees for golfing must be comparable to green fees typically charged by
municipal courses; and

(ii) it meets the requirements of section 273.112, subdivision 3, paragraph (d).

A structure used as a clubhouse, restaurant, or place of refreshment in conjunction
with the golf course is classified as class 3a property;

(3) real property up to a maximum of three acres of land owned and used by a
nonprofit community service oriented organization and not used for residential purposes
on either a temporary or permanent basis, provided that:

(i) the property is not used for a revenue-producing activity for more than six days
in the calendar year preceding the year of assessment; or

(ii) the organization makes annual charitable contributions and donations at least
equal to the property's previous year's property taxes and the property is allowed to be
used for public and community meetings or events for no charge, as appropriate to the
size of the facility.

For purposes of this clause:

(A) "charitable contributions and donations" has the same meaning as lawful
gambling purposes under section 349.12, subdivision 25, excluding those purposes
relating to the payment of taxes, assessments, fees, auditing costs, and utility payments;

(B) "property taxes" excludes the state general tax;

(C) a "nonprofit community service oriented organization" means any corporation,
society, association, foundation, or institution organized and operated exclusively for
charitable, religious, fraternal, civic, or educational purposes, and which is exempt from
federal income taxation pursuant to section 501(c)(3), (8), (10), or (19) of the Internal
Revenue Code; and

(D) "revenue-producing activities" shall include but not be limited to property or that
portion of the property that is used as an on-sale intoxicating liquor or 3.2 percent malt
liquor establishment licensed under chapter 340A, a restaurant open to the public, bowling
alley, a retail store, gambling conducted by organizations licensed under chapter 349, an
insurance business, or office or other space leased or rented to a lessee who conducts a
for-profit enterprise on the premises.

Any portion of the property not qualifying under either item (i) or (ii) is class 3a. The use
of the property for social events open exclusively to members and their guests for periods
of less than 24 hours, when an admission is not charged nor any revenues are received by
the organization shall not be considered a revenue-producing activity.

The organization shall maintain records of its charitable contributions and donations
and of public meetings and events held on the property and make them available upon
request any time to the assessor to ensure eligibility. An organization meeting the
requirement under item (ii) must file an application by May 1 with the assessor for
eligibility for the current year's assessment. The commissioner shall prescribe a uniform
application form and instructions;

(4) postsecondary student housing of not more than one acre of land that is owned by
a nonprofit corporation organized under chapter 317A and is used exclusively by a student
cooperative, sorority, or fraternity for on-campus housing or housing located within two
miles of the border of a college campus;

(5)(i) manufactured home parks as defined in section 327.14, subdivision 3,
excluding manufactured home parks described in section 273.124, subdivision 3a, and (ii)
manufactured home parks as defined in section 327.14, subdivision 3, that are described in
section 273.124, subdivision 3a;

(6) real property that is actively and exclusively devoted to indoor fitness, health,
social, recreational, and related uses, is owned and operated by a not-for-profit corporation,
and is located within the metropolitan area as defined in section 473.121, subdivision 2;

(7) a leased or privately owned noncommercial aircraft storage hangar not exempt
under section 272.01, subdivision 2, and the land on which it is located, provided that:

(i) the land is on an airport owned or operated by a city, town, county, Metropolitan
Airports Commission, or group thereof; and

(ii) the land lease, or any ordinance or signed agreement restricting the use of the
leased premise, prohibits commercial activity performed at the hangar.

If a hangar classified under this clause is sold after June 30, 2000, a bill of sale must
be filed by the new owner with the assessor of the county where the property is located
within 60 days of the sale;

(8) a privately owned noncommercial aircraft storage hangar not exempt under
section 272.01, subdivision 2, and the land on which it is located, provided that:

(i) the land abuts a public airport; and

(ii) the owner of the aircraft storage hangar provides the assessor with a signed
agreement restricting the use of the premises, prohibiting commercial use or activity
performed at the hangar; and

(9) residential real estate, a portion of which is used by the owner for homestead
purposes, and that is also a place of lodging, if all of the following criteria are met:

(i) rooms are provided for rent to transient guests that generally stay for periods
of 14 or fewer days;

(ii) meals are provided to persons who rent rooms, the cost of which is incorporated
in the basic room rate;

(iii) meals are not provided to the general public except for special events on fewer
than seven days in the calendar year preceding the year of the assessment; and

(iv) the owner is the operator of the property.

The market value subject to the 4c classification under this clause is limited to five rental
units. Any rental units on the property in excess of five, must be valued and assessed as
class 3a. The portion of the property used for purposes of a homestead by the owner must
be classified as class 1a property under subdivision 22;

(10) real property up to a maximum of three acres and operated as a restaurant
as defined under section 157.15, subdivision 12, provided it: (A) is located on a lake
as defined under section 103G.005, subdivision 15, paragraph (a), clause (3); and (B)
is either devoted to commercial purposes for not more than 250 consecutive days, or
receives at least 60 percent of its annual gross receipts from business conducted during
four consecutive months. Gross receipts from the sale of alcoholic beverages must be
included in determining the property's qualification under subitem (B). The property's
primary business must be as a restaurant and not as a bar. Gross receipts from gift shop
sales located on the premises must be excluded. Owners of real property desiring 4c
classification under this clause must submit an annual declaration to the assessor by
February 1 of the current assessment year, based on the property's relevant information for
the preceding assessment year;

(11) lakeshore and riparian property and adjacent land, not to exceed six acres, used
as a marina, as defined in section 86A.20, subdivision 5, which is made accessible to
the public and devoted to recreational use for marina services. The marina owner must
annually provide evidence to the assessor that it provides services, including lake or river
access to the public by means of an access ramp or other facility that is either located on
the property of the marina or at a publicly owned site that abuts the property of the marina.
No more than 800 feet of lakeshore may be included in this classification. Buildings used
in conjunction with a marina for marina services, including but not limited to buildings
used to provide food and beverage services, fuel, boat repairs, or the sale of bait or fishing
tackle, are classified as class 3a property; and

(12) real and personal property devoted to noncommercial temporary and seasonal
residential occupancy for recreation purposes.

Class 4c property has a class rate of 1.5 percent of market value, except that (i) each
parcel of noncommercial seasonal residential recreational property under clause (12)
has the same class rates as class 4bb property, (ii) manufactured home parks assessed
under clause (5), item (i), have the same class rate as class 4b property, and the market
value of manufactured home parks assessed under clause (5), item (ii), has the same class
rate as class 4d property if more than 50 percent of the lots in the park are occupied by
shareholders in the cooperative corporation or association and a class rate of one percent if
50 percent or less of the lots are so occupied, (iii) commercial-use seasonal residential
recreational property and marina recreational land as described in clause (11), has a
class rate of one percent for the first $500,000 of market value, and 1.25 percent for the
remaining market value, (iv) the market value of property described in clause (4) has a
class rate of one percent, (v) the market value of property described in clauses (2), (6), and
(10) has a class rate of 1.25 percent, and (vi) that portion of the market value of property
in clause (9) qualifying for class 4c property has a class rate of 1.25 percent.

(e) Class 4d property is qualifying low-income rental housing certified to the assessor
by the Housing Finance Agency under section 273.128, subdivision 3. If only a portion
of the units in the building qualify as low-income rental housing units as certified under
section 273.128, subdivision 3, only the proportion of qualifying units to the total number
of units in the building qualify for class 4d. The remaining portion of the building shall be
classified by the assessor based upon its use. Class 4d also includes the same proportion of
land as the qualifying low-income rental housing units are to the total units in the building.
For all properties qualifying as class 4d, the market value determined by the assessor must
be based on the normal approach to value using normal unrestricted rents.

Class 4d property has a class rate of 0.75 percent.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxes payable in 2013 and
thereafter.
new text end

Sec. 11.

Minnesota Statutes 2010, section 273.1315, subdivision 1, is amended to read:


Subdivision 1.

Class 1b homestead declaration before 2009.

Any property owner
seeking classification and assessment of the owner's homestead as class 1b property
pursuant to section 273.13, subdivision 22, paragraph (b), on or before October 1, 2008,
shall file with the commissioner of revenue a 1b homestead declaration, on a form
prescribed by the commissioner. The declaration shall contain the following information:

deleted text begin (a)deleted text end new text begin (1)new text end the information necessary to verify that on or before June 30 of the filing year,
the property owner or the owner's spouse satisfies the requirements of section 273.13,
subdivision 22
, paragraph (b), for 1b classification; and

deleted text begin (b)deleted text end new text begin (2)new text end any additional information prescribed by the commissioner.

The declaration must be filed on or before October 1 to be effective for property
taxes payable during the succeeding calendar year. The declaration and any supplementary
information received from the property owner pursuant to this subdivision shall be subject
to chapter 270B. If approved by the commissioner, the declaration remains in effect until
the property no longer qualifies under section 273.13, subdivision 22, paragraph (b).
Failure to notify the commissioner within 30 days that the property no longer qualifies
under that paragraph because of a sale, change in occupancy, or change in the status
or condition of an occupant shall result in the penalty provided in section 273.124,
subdivision deleted text begin 13deleted text end new text begin 13bnew text end , computed on the basis of the class 1b benefits for the property, and
the property shall lose its current class 1b classification.

The commissioner shall provide to the assessor on or before November 1 a listing
of the parcels of property qualifying for 1b classification.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 12.

Minnesota Statutes 2010, section 273.1315, subdivision 2, is amended to read:


Subd. 2.

Class 1b homestead declaration 2009 and thereafter.

(a) Any property
owner seeking classification and assessment of the owner's homestead as class 1b property
pursuant to section 273.13, subdivision 22, paragraph (b), after October 1, 2008, shall file
with the county assessor a class 1b homestead declaration, on a form prescribed by the
commissioner of revenue. The declaration must contain the following information:

(1) the information necessary to verify that, on or before June 30 of the filing year,
the property owner or the owner's spouse satisfies the requirements of section 273.13,
subdivision 22, paragraph (b), for class 1b classification; and

(2) any additional information prescribed by the commissioner.

(b) The declaration must be filed on or before October 1 to be effective for property
taxes payable during the succeeding calendar year. The Social Security numbers and
income and medical information received from the property owner pursuant to this
subdivision are private data on individuals as defined in section 13.02. If approved by
the assessor, the declaration remains in effect until the property no longer qualifies under
section 273.13, subdivision 22, paragraph (b). Failure to notify the assessor within 30
days that the property no longer qualifies under that paragraph because of a sale, change in
occupancy, or change in the status or condition of an occupant shall result in the penalty
provided in section 273.124, subdivision deleted text begin 13deleted text end new text begin 13bnew text end , computed on the basis of the class 1b
benefits for the property, and the property shall lose its current class 1b classification.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 13.

Minnesota Statutes 2010, section 273.19, subdivision 1, is amended to read:


Subdivision 1.

Tax-exempt property; lease.

Except as provided in subdivision 3 or
4, tax-exempt property held under a lease for a term of at least one year, and not taxable
under section 272.01, subdivision 2, or under a contract for the purchase thereof, shall
be considered, for all purposes of taxation, as the property of the person holding it. In
this subdivision, "tax-exempt property" means property owned by the United States, the
statenew text begin or any of its political subdivisionsnew text end , a school, or any religious, scientific, or benevolent
society or institution, incorporated or unincorporated, or any corporation whose property
is not taxed in the same manner as other property. This subdivision does not apply to
property exempt from taxation under section 272.01, subdivision 2, paragraph (b), clauses
(2), (3), and (4), or to property exempt from taxation under section 272.0213.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 14.

Minnesota Statutes 2010, section 273.372, subdivision 4, is amended to read:


Subd. 4.

Administrative appeals.

(a) Companies that submit the reports under
section 270.82 or 273.371 by the date specified in that section, or by the date specified by
the commissioner in an extension, may appeal administratively to the commissioner prior
to bringing an action in court deleted text begin by submittingdeleted text end new text begin .
new text end

new text begin (b) Companies that must submit reports under section 270.82 must submitnew text end a written
request deleted text begin withdeleted text end new text begin tonew text end the commissioner for a conference within ten days after the date of the
commissioner's valuation certification or notice to the company, or by deleted text begin Maydeleted text end new text begin Junenew text end 15,
whichever is earlier.

new text begin (c) Companies that submit reports under section 273.371 must submit a written
request to the commissioner for a conference within ten days after the date of the
commissioner's valuation certification or notice to the company, or by July 1, whichever
is earlier.
new text end

new text begin (d)new text end The commissioner shall conduct the conference upon the commissioner's entire
files and records and such further information as may be offered. The conference must
be held no later than 20 days after the date of the commissioner's valuation certification
or notice to the company, or by the date specified by the commissioner in an extension.
Within 60 days after the conference the commissioner shall make a final determination of
the matter and shall notify the company promptly of the determination. The conference
is not a contested case hearing.

deleted text begin (b)deleted text end new text begin (e)new text end In addition to the opportunity for a conference under paragraph (a), the
commissioner shall also provide the railroad and utility companies the opportunity to
discuss any questions or concerns relating to the values established by the commissioner
through certification or notice in a less formal manner. This does not change or modify
the deadline for requesting a conference under paragraph (a), the deadline in section
271.06 for appealing an order of the commissioner, or the deadline in section 278.01 for
appealing property taxes in court.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective beginning with assessment year 2013.
new text end

Sec. 15.

Minnesota Statutes 2010, section 273.39, is amended to read:


273.39 RURAL AREA.

As used in sections 273.39 to 273.41, the term "rural area" shall be deemed to mean
any area of the state not included within the boundaries of any deleted text begin incorporateddeleted text end new text begin statutory
city or home rule charter
new text end city, and such term shall be deemed to include both farm and
nonfarm population thereof.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective beginning with assessment year 2012.
new text end

Sec. 16.

Minnesota Statutes 2010, section 279.06, subdivision 1, is amended to read:


Subdivision 1.

List and notice.

Within five days after the filing of such list, the
court administrator shall return a copy thereof to the county auditor, with a notice prepared
and signed by the court administrator, and attached thereto, which may be substantially in
the following form:

State of Minnesota
)
) ss.
County of
.
)
District Court
. Judicial District.

The state of Minnesota, to all persons, companies, or corporations who have or claim
any estate, right, title, or interest in, claim to, or lien upon, any of the several parcels of
land described in the list hereto attached:

The list of taxes and penalties on real property for the county of ...............................
remaining delinquent on the first Monday in January, ......., has been filed in the office of
the court administrator of the district court of said county, of which that hereto attached is a
copy. Therefore, you, and each of you, are hereby required to file in the office of said court
administrator, on or before the 20th day after the publication of this notice and list, your
answer, in writing, setting forth any objection or defense you may have to the taxes, or any
part thereof, upon any parcel of land described in the list, in, to, or on which you have or
claim any estate, right, title, interest, claim, or lien, and, in default thereof, judgment will
be entered against such parcel of land for the taxes on such list appearing against it, and
for all penalties, interest, and costs. Based upon said judgment, the land shall be sold to
the state of Minnesota on the second Monday in May, ....... deleted text begin The period of redemption for
all lands sold to the state at a tax judgment sale shall be three years from the date of sale to
the state of Minnesota if the land is within an incorporated area unless it is:
deleted text end

deleted text begin (a) nonagricultural homesteaded land as defined in section 273.13, subdivision 22;
deleted text end

deleted text begin (b) homesteaded agricultural land as defined in section 273.13, subdivision 23,
paragraph (a);
deleted text end

deleted text begin (c) seasonal residential recreational land as defined in section 273.13, subdivisions
22, paragraph (c)
, and 25, paragraph (d), clause (1), in which event the period of
redemption is five years from the date of sale to the state of Minnesota;
deleted text end

deleted text begin (d) abandoned property and pursuant to section 281.173 a court order has been
entered shortening the redemption period to five weeks; or
deleted text end

deleted text begin (e) vacant property as described under section 281.174, subdivision 2, and for which
a court order is entered shortening the redemption period under section 281.174.
deleted text end

deleted text begin The period of redemption for all other lands sold to the state at a tax judgment sale
shall be five years from the date of sale.
deleted text end

Inquiries as to the proceedings set forth above can be made to the county auditor of
..... county whose address is ......

(Signed) . ,
Court Administrator of the District Court of the
County of
.
(Here insert list.)

new text begin The notice must contain a narrative description of the various periods to redeem
specified in sections 281.17, 281.173, and 281.174, in the manner prescribed by the
commissioner of revenue under subdivision 2.
new text end

The list referred to in the notice shall be substantially in the following form:

List of real property for the county of ......................., on which taxes remain
delinquent on the first Monday in January, .......

Town of (Fairfield),

Township (40), Range (20),

Names (and Current
Filed Addresses) for
the Taxpayers and Fee
Owners and in Addition
Those Parties Who Have
Filed Their Addresses
Pursuant to section
276.041
Subdivision of
Section
Section
Tax Parcel
Number
Total Tax
and Penalty
$ cts.
John Jones (825 Fremont
Fairfield, MN 55000)
S.E. 1/4 of S.W. 1/4
10
23101
2.20
Bruce Smith (2059 Hand
Fairfield, MN 55000)
and Fairfield State
Bank (100 Main Street
Fairfield, MN 55000)
That part of N.E. 1/4
of S.W. 1/4 desc. as
follows: Beg. at the
S.E. corner of said N.E.
1/4 of S.W. 1/4; thence
N. along the E. line of
said N.E. 1/4 of S.W.
1/4 a distance of 600
ft.; thence W. parallel
with the S. line of said
N.E. 1/4 of S.W. 1/4
a distance of 600 ft.;
thence S. parallel with
said E. line a distance of
600 ft. to S. line of said
N.E. 1/4 of S.W. 1/4;
thence E. along said S.
line a distance of 600 ft.
to the point of beg.
21
33211
3.15

As to platted property, the form of heading shall conform to circumstances and be
substantially in the following form:

City of (Smithtown)

Brown's Addition, or Subdivision

Names (and Current
Filed Addresses) for
the Taxpayers and Fee
Owners and in Addition
Those Parties Who Have
Filed Their Addresses
Pursuant to section
276.041
Lot
Block
Tax Parcel
Number
Total Tax
and Penalty
$ cts.
John Jones (825 Fremont
Fairfield, MN 55000)
15
9
58243
2.20
Bruce Smith (2059 Hand
Fairfield, MN 55000)
and Fairfield State
Bank (100 Main Street
Fairfield, MN 55000)
16
9
58244
3.15

The names, descriptions, and figures employed in parentheses in the above forms are
merely for purposes of illustration.

The name of the town, township, range or city, and addition or subdivision, as the
case may be, shall be repeated at the head of each column of the printed lists as brought
forward from the preceding column.

Errors in the list shall not be deemed to be a material defect to affect the validity
of the judgment and sale.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for lists and notices required after
December 31, 2012.
new text end

Sec. 17.

Minnesota Statutes 2010, section 290A.25, is amended to read:


290A.25 VERIFICATION OF SOCIAL SECURITY NUMBERS.

Annually, the commissioner of revenue shall furnish a list to the county assessor
containing the names and Social Security numbers of persons who have applied for both
homestead classification under section 273.13 and a property tax refund as a renter
under this chapter.

Within 90 days of the notification, the county assessor shall investigate to determine
if the homestead classification was improperly claimed. If the property owner does
not qualify, the county assessor shall notify the county auditor who will determine the
amount of homestead benefits that has been improperly allowed. For the purpose of this
section, "homestead benefits" has the meaning given in section 273.124, subdivision
deleted text begin 13deleted text end
deleted text begin , paragraph (h)deleted text end new text begin 13bnew text end . The county auditor shall send a notice to persons who owned the
affected property at the time the homestead application related to the improper homestead
was filed, demanding reimbursement of the homestead benefits plus a penalty equal to
100 percent of the homestead benefits. The person notified may appeal the county's
determination with the Minnesota Tax Court within 60 days of the date of the notice from
the county as provided in section 273.124, subdivision deleted text begin 13deleted text end deleted text begin , paragraph (h)deleted text end new text begin 13bnew text end .

If the amount of homestead benefits and penalty is not paid within 60 days, and if
no appeal has been filed, the county auditor shall certify the amount of taxes and penalty
to the county treasurer. The county treasurer will add interest to the unpaid homestead
benefits and penalty amounts at the rate provided for delinquent personal property taxes
for the period beginning 60 days after demand for payment was made until payment. If
the person notified is the current owner of the property, the treasurer may add the total
amount of benefits, penalty, interest, and costs to the real estate taxes otherwise payable on
the property in the following year. If the person notified is not the current owner of the
property, the treasurer may collect the amounts due under the Revenue Recapture Act in
chapter 270A, or use any of the powers granted in sections 277.20 and 277.21 without
exclusion, to enforce payment of the benefits, penalty, interest, and costs, as if those
amounts were delinquent tax obligations of the person who owned the property at the time
the application related to the improperly allowed homestead was filed. The treasurer may
relieve a prior owner of personal liability for the benefits, penalty, interest, and costs, and
instead extend those amounts on the tax lists against the property for taxes payable in the
following year to the extent that the current owner agrees in writing.

Any amount of homestead benefits recovered by the county from the property owner
shall be distributed to the county, city or town, and school district where the property is
located in the same proportion that each taxing district's levy was to the total of the three
taxing districts' levy for the current year. Any amount recovered attributable to taconite
homestead credit shall be transmitted to the St. Louis County auditor to be deposited in
the taconite property tax relief account. Any amount recovered that is attributable to
supplemental homestead credit is to be transmitted to the commissioner of revenue for
deposit in the general fund of the state treasury. The total amount of penalty collected
must be deposited in the county general fund.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 18.

Minnesota Statutes 2010, section 290B.04, subdivision 2, is amended to read:


Subd. 2.

Approval; recording.

The commissioner shall approve all initial
applications that qualify under this chapter and shall notify qualifying homeowners on or
before December 1. The commissioner may investigate the facts or require confirmation
in regard to an application. The commissioner shall record or file a notice of qualification
for deferral, including the names of the qualifying homeowners and a legal description
of the property, in the office of the county recorder, or registrar of titles, whichever is
applicable, in the county where the qualifying property is located. The notice must state
that it serves as a notice of lien and that it includes deferrals under this section for future
years.new text begin The commissioner shall prescribe the form of the notice. Execution of the notice
by the original or facsimile signature of the commissioner or a delegate entitles them to
be recorded, and no other attestation, certification, or acknowledgment is necessary.
new text end The
homeowner shall pay the recording or filing fees for the notice, which, notwithstanding
section 357.18, shall be paid by the homeowner at the time of satisfaction of the lien.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for notices that are both executed
and recorded after June 30, 2012.
new text end

Sec. 19.

Minnesota Statutes 2011 Supplement, section 373.01, subdivision 1, is
amended to read:


Subdivision 1.

Public corporation; listed powers.

(a) Each county is a body politic
and corporate and may:

(1) Sue and be sued.

(2) Acquire and hold real and personal property for the use of the county, and lands
sold for taxes as provided by law.

(3) Purchase and hold for the benefit of the county real estate sold by virtue of
judicial proceedings, to which the county is a party.

(4) Sell, lease, and convey real or personal estate owned by the county, and give
contracts or options to sell, lease, or convey it, and make orders respecting it as deemed
conducive to the interests of the county's inhabitants.

(5) Make all contracts and do all other acts in relation to the property and concerns
of the county necessary to the exercise of its corporate powers.

(b) No sale, lease, or conveyance of real estate owned by the county, except the lease
of a residence acquired for the furtherance of an approved capital improvement project, nor
any contract or option for it, shall be valid, without first advertising for bids or proposals in
the official newspaper of the county for three consecutive weeks and once in a newspaper
of general circulation in the area where the property is located. The notice shall state the
time and place of considering the proposals, contain a legal description of any real estate,
and a brief description of any personal property. Leases that do not exceed $15,000 for any
one year may be negotiated and are not subject to the competitive bid procedures of this
section. All proposals estimated to exceed $15,000 in any one year shall be considered at
the time set for the bid opening, and the one most favorable to the county accepted, but the
county board may, in the interest of the county, reject any or all proposals.

(c) Sales of personal property the value of which is estimated to be $15,000 or
more shall be made only after advertising for bids or proposals in the county's official
newspaper, on the county's Web site, or in a recognized industry trade journal. At the same
time it posts on its Web site or publishes in a trade journal, the county must publish in the
official newspaper, either as part of the minutes of a regular meeting of the county board
or in a separate notice, a summary of all requests for bids or proposals that the county
advertises on its Web site or in a trade journal. After publication in the official newspaper,
on the Web site, or in a trade journal, bids or proposals may be solicited and accepted by
the electronic selling process authorized in section 471.345, subdivision 17. Sales of
personal property the value of which is estimated to be less than $15,000 may be made
either on competitive bids or in the open market, in the discretion of the county board.
"Web site" means a specific, addressable location provided on a server connected to the
Internet and hosting World Wide Web pages and other files that are generally accessible
on the Internet all or most of a day.

(d) Notwithstanding anything to the contrary herein, the county may, when acquiring
real property for county highway right-of-way, exchange parcels of real property of
substantially similar or equal value without advertising for bids. The estimated values for
these parcels shall be determined by the county assessor.

(e) Notwithstanding anything in this section to the contrary, the county may, when
acquiring real property for purposes other than county highway right-of-way, exchange
parcels of real property of substantially similar or equal value without advertising for bids.
The estimated values for these parcels must be determined by the county assessor or a
private appraisal performed by a licensed Minnesota real estate appraiser. new text begin For the purpose
of making these estimates, the county assessor need not be licensed under chapter 82B.
new text end Before giving final approval to any exchange of land, the county board shall hold a public
hearing on the exchange. At least two weeks before the hearing, the county auditor shall
post a notice in the auditor's office and the official newspaper of the county of the hearing
that contains a description of the lands affected.

(f) If real estate or personal property remains unsold after advertising for and
consideration of bids or proposals the county may employ a broker to sell the property.
The broker may sell the property for not less than 90 percent of its appraised market value
as determined by the county. The broker's fee shall be set by agreement with the county but
may not exceed ten percent of the sale price and must be paid from the proceeds of the sale.

(g) A county or its agent may rent a county-owned residence acquired for the
furtherance of an approved capital improvement project subject to the conditions set
by the county board and not subject to the conditions for lease otherwise provided by
paragraph (a), clause (4), and paragraphs (b), (c), (d), (f), and (h).

(h) In no case shall lands be disposed of without there being reserved to the county
all iron ore and other valuable minerals in and upon the lands, with right to explore for,
mine and remove the iron ore and other valuable minerals, nor shall the minerals and
mineral rights be disposed of, either before or after disposition of the surface rights,
otherwise than by mining lease, in similar general form to that provided by section 93.20
for mining leases affecting state lands. The lease shall be for a term not exceeding 50
years, and be issued on a royalty basis, the royalty to be not less than 25 cents per ton of
2,240 pounds, and fix a minimum amount of royalty payable during each year, whether
mineral is removed or not. Prospecting options for mining leases may be granted for
periods not exceeding one year. The options shall require, among other things, periodical
showings to the county board of the results of exploration work done.

(i) Notwithstanding anything in this subdivision to the contrary, the county may,
when selling real property owned in fee simple that cannot be improved because of
noncompliance with local ordinances regarding minimum area, shape, frontage, or access,
proceed to sell the nonconforming parcel without advertising for bid. At the county's
discretion, the real property may be restricted to sale to adjoining landowners or may be
sold to any other interested party. The property shall be sold to the highest bidder, but
in no case shall the property be sold for less than 90 percent of its fair market value as
determined by the county assessor. All owners of land adjoining the land to be sold shall
be given a written notice at least 30 days before the sale. This paragraph shall be liberally
construed to encourage the sale of nonconforming real property and promote its return to
the tax roles.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 20. new text begin REPEALER.
new text end

new text begin (a) new text end new text begin Minnesota Statutes 2010, section 272.69, new text end new text begin is repealed.
new text end

new text begin (b) new text end new text begin Minnesota Statutes 2010, section 273.11, subdivision 22, new text end new text begin is repealed.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin Paragraph (a) is effective the day following final enactment.
Paragraph (b) is effective for taxes payable in 2013 and thereafter.
new text end

ARTICLE 4

DEPARTMENT POLICY AND TECHNICAL: SALES AND USE
TAXES; SPECIAL TAXES

Section 1.

Minnesota Statutes 2010, section 65B.84, subdivision 1, is amended to read:


Subdivision 1.

Program described; commissioner's duties; appropriation.

(a)
The commissioner of commerce shall:

(1) develop and sponsor the implementation of statewide plans, programs, and
strategies to combat automobile theft, improve the administration of the automobile theft
laws, and provide a forum for identification of critical problems for those persons dealing
with automobile theft;

(2) coordinate the development, adoption, and implementation of plans, programs,
and strategies relating to interagency and intergovernmental cooperation with respect
to automobile theft enforcement;

(3) annually audit the plans and programs that have been funded in whole or in part
to evaluate the effectiveness of the plans and programs and withdraw funding should the
commissioner determine that a plan or program is ineffective or is no longer in need
of further financial support from the fund;

(4) develop a plan of operation including:

(i) an assessment of the scope of the problem of automobile theft, including areas
of the state where the problem is greatest;

(ii) an analysis of various methods of combating the problem of automobile theft;

(iii) a plan for providing financial support to combat automobile theft;

(iv) a plan for eliminating car hijacking; and

(v) an estimate of the funds required to implement the plan; and

(5) distribute money, in consultation with the commissioner of public safety,
pursuant to subdivision 3 from the automobile theft prevention special revenue account
for automobile theft prevention activities, including:

(i) paying the administrative costs of the program;

(ii) providing financial support to the State Patrol and local law enforcement
agencies for automobile theft enforcement teams;

(iii) providing financial support to state or local law enforcement agencies for
programs designed to reduce the incidence of automobile theft and for improved
equipment and techniques for responding to automobile thefts;

(iv) providing financial support to local prosecutors for programs designed to reduce
the incidence of automobile theft;

(v) providing financial support to judicial agencies for programs designed to reduce
the incidence of automobile theft;

(vi) providing financial support for neighborhood or community organizations or
business organizations for programs designed to reduce the incidence of automobile
theft and to educate people about the common methods of automobile theft, the models
of automobiles most likely to be stolen, and the times and places automobile theft is
most likely to occur; and

(vii) providing financial support for automobile theft educational and training
programs for state and local law enforcement officials, driver and vehicle services exam
and inspections staff, and members of the judiciary.

(b) The commissioner may not spend in any fiscal year more than ten percent of the
money in the fund for the program's administrative and operating costs. The commissioner
is annually appropriated and must distribute the amount of the proceeds credited to
the automobile theft prevention special revenue account each year, less the transfer
of $1,300,000 each year to the general fund described in section deleted text begin 168A.40, subdivision
4
deleted text end new text begin 297I.11, subdivision 2new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for premiums collected after June
30, 2012.
new text end

Sec. 2.

Minnesota Statutes 2010, section 287.20, is amended by adding a subdivision
to read:


new text begin Subd. 11. new text end

new text begin Partition. new text end

new text begin "Partition" means the division by conveyance of real property
that is held jointly or in common by two or more persons into individually owned interests.
If one of the co-owners gives consideration for all or a part of the individually owned
interest conveyed to them, that portion of the conveyance is not a part of the partition.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 3.

Minnesota Statutes 2010, section 297A.665, is amended to read:


297A.665 PRESUMPTION OF TAX; BURDEN OF PROOF.

(a) For the purpose of the proper administration of this chapter and to prevent
evasion of the tax, until the contrary is established, it is presumed that:

(1) all gross receipts are subject to the tax; and

(2) all retail sales for delivery in Minnesota are for storage, use, or other consumption
in Minnesota.

(b) The burden of proving that a sale is not a taxable retail sale is on the seller.
However, a seller is relieved of liability if:

(1) the seller obtains a fully completed exemption certificate or all the relevant
information required by section 297A.72, subdivision 2, at the time of the sale or within
90 days after the date of the sale; or

(2) if the seller has not obtained a fully completed exemption certificate or all the
relevant information required by section 297A.72, subdivision 2, within the time provided
in clause (1), within 120 days after a request for substantiation by the commissioner,
the seller either:

(i) obtains deleted text begin in good faithdeleted text end new text begin from the purchasernew text end a fully completed exemption certificate
or all the relevant information required by section 297A.72, subdivision 2, deleted text begin from the
purchaser
deleted text end new text begin taken in good faith which means that the exemption certificate claims an
exemption that (A) was statutorily available on the date of the transaction, (B) could be
applicable to the item for which the exemption is claimed, and (C) is reasonable for the
purchaser's type of business
new text end ; or

(ii) proves by other means that the transaction was not subject to tax.

(c) Notwithstanding paragraph (b), relief from liability does not apply to a seller who:

(1) fraudulently fails to collect the tax; or

(2) solicits purchasers to participate in the unlawful claim of an exemption.

new text begin (d) Notwithstanding paragraph (b), relief from liability does not apply to a seller
who has obtained information under paragraph (b), clause (2), if through the audit process
the commissioner finds the following:
new text end

new text begin (1) that at the time the information was provided the seller had knowledge or had
reason to know that the information relating to the exemption was materially false; or
new text end

new text begin (2) that the seller knowingly participated in activity intended to purposefully evade
the sales tax due on the transaction.
new text end

deleted text begin (d)deleted text end new text begin (e)new text end A certified service provider, as defined in section 297A.995, subdivision 2, is
relieved of liability under this section to the extent a seller who is its client is relieved of
liability.

deleted text begin (e)deleted text end new text begin (f)new text end A purchaser of tangible personal property or any items listed in section
297A.63 that are shipped or brought to Minnesota by the purchaser has the burden
of proving that the property was not purchased from a retailer for storage, use, or
consumption in Minnesota.

deleted text begin (f)deleted text end new text begin (g)new text end If a seller claims that certain sales are exempt and does not provide the
certificate, information, or proof required by paragraph (b), clause (2), within 120 days
after the date of the commissioner's request for substantiation, then the exemptions
claimed by the seller that required substantiation are disallowed.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 4.

Minnesota Statutes 2010, section 297F.01, subdivision 23, is amended to read:


Subd. 23.

Wholesale sales price.

"Wholesale sales price" means the price deleted text begin stated on
the price list in effect at the time of sale for which a manufacturer or person sells a tobacco
product to a distributor, exclusive of any discount, promotional offer, or other reduction.
For purposes of this subdivision, "price list" means the manufacturer's price at which
tobacco products are made available for sale to all distributors on an ongoing basis
deleted text end new text begin at which
a distributor purchases a tobacco product without any reduction for federal excise taxes,
freight charges, discounts, packaging, or other reductions. Wholesale sales price includes
the applicable federal excise tax regardless of whether it is included in the purchase price
new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for purchases made after December
31, 2012.
new text end

Sec. 5.

Minnesota Statutes 2010, section 297G.04, subdivision 2, is amended to read:


Subd. 2.

Tax credit.

A qualified brewer producing fermented malt beverages
is entitled to a tax credit of $4.60 per barrel on 25,000 barrels sold in any fiscal year
beginning July 1, regardless of the alcohol content of the product. Qualified brewers may
take the credit on the 18th day of each month, but the total credit allowed may not exceed
in any fiscal year the lesser of:

(1) the liability for tax; or

(2) $115,000.

For purposes of this subdivision, a "qualified brewer" means a brewer, whether
or not located in this state, manufacturing less than 100,000 barrels of fermented malt
beverages in the calendar year immediately preceding the deleted text begin calendardeleted text end new text begin fiscalnew text end year for which
the credit under this subdivision is claimed. In determining the number of barrels, all
brands or labels of a brewer must be combined. All facilities for the manufacture of
fermented malt beverages owned or controlled by the same person, corporation, or other
entity must be treated as a single brewer.new text begin A brewer is owned or controlled when more than
50 percent of the voting stock of each member of the group is directly or indirectly owned
by a common owner or by common owners, whether they are corporate or noncorporate.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for claims filed after December
31, 2012.
new text end

Sec. 6.

Minnesota Statutes 2011 Supplement, section 297I.05, subdivision 7, is
amended to read:


Subd. 7.

Nonadmitted insurance premium tax.

(a) A tax is imposed on surplus
lines brokers. The rate of tax is equal to three percent of the gross premiums less return
premiums paid by an insured whose home state is Minnesota.

(b) A tax is imposed on deleted text begin persons, firms, or corporationsdeleted text end new text begin a person, firm, corporation,
or purchasing group as defined in section 60E.02, or any member of a purchasing group,
new text end
that procure insurance directly from a nonadmitted insurer. The rate of tax is equal to two
percent of the gross premiums less return premiums paid by an insured whose home
state is Minnesota.

(c) No state other than the home state of an insured may require any premium tax
payment for nonadmitted insurance. When Minnesota is the home state of the insured,
as provided under section 297I.01, 100 percent of the gross premiums are taxable in
Minnesota with no allocation of the tax to other states.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for premiums received after
December 31, 2012.
new text end

Sec. 7.

Minnesota Statutes 2010, section 297I.05, subdivision 11, is amended to read:


Subd. 11.

Retaliatory provisions.

(a) If any other state or country imposes any
taxes, fines, deposits, penalties, licenses, or fees upon any insurance companies of this
state and their agents doing business in another state or country that are in addition to or in
excess of those imposed by the laws of this state upon foreign insurance companies and
their agents doing business in this state, the same taxes, fines, deposits, penalties, licenses,
and fees are imposed upon every similar insurance company of that state or country and
their agents doing or applying to do business in this state.

(b) If any conditions precedent to the right to do business in any other state or
country are imposed by the laws of that state or country, beyond those imposed upon
foreign companies by the laws of this state, the same conditions precedent are imposed
upon every similar insurance company of that state or country and their agents doing or
applying to do business in that state.

(c) For purposes of this subdivision, "taxes, fines, deposits, penalties, licenses, or
fees" means an amount of money that is deposited in the general revenue fund of the state
or other similar fund in another state or country and is not dedicated to a special purpose
or use or money deposited in the general revenue fund of the state or other similar fund in
another state or country and appropriated to the commissioner of commerce or insurance
for the operation of the Department of Commerce or other similar agency with jurisdiction
over insurance. Taxes, fines, deposits, penalties, licenses, or fees do not include:

(1) special purpose obligations or assessments imposed in connection with particular
kinds of insurance, including but not limited to assessments imposed in connection with
residual market mechanisms; or

(2) assessments made by the insurance guaranty association, life and health
guarantee association, or similar association.

(d) This subdivision applies to taxes imposed under subdivisions 1deleted text begin ,deleted text end new text begin ;new text end 3deleted text begin ,deleted text end new text begin ;new text end 4deleted text begin , 6, anddeleted text end new text begin ;new text end 12,
paragraph (a), clauses (1) and (2)new text begin ; and 14new text end .

(e) This subdivision does not apply to insurance companies organized or domiciled
in a state or country, the laws of which do not impose retaliatory taxes, fines, deposits,
penalties, licenses, or fees or which grant, on a reciprocal basis, exemptions from
retaliatory taxes, fines, deposits, penalties, licenses, or fees to insurance companies
domiciled in this state.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 8.

Minnesota Statutes 2011 Supplement, section 297I.05, subdivision 12, is
amended to read:


Subd. 12.

Other entities.

(a) A tax is imposed equal to two percent of:

(1) gross premiums less return premiums written for risks resident or located in
Minnesota by a risk retention group;

(2) gross premiums less return premiums received by an attorney in fact acting
in accordance with chapter 71A;

(3) gross premiums less return premiums received pursuant to assigned risk policies
and contracts of coverage under chapter 79;new text begin and
new text end

(4) the direct funded premium received by the reinsurance association under section
79.34 from self-insurers approved under section 176.181 and political subdivisions that
self-insuredeleted text begin ; anddeleted text end new text begin .
new text end

deleted text begin (5) gross premiums less return premiums paid to an insurer other than a licensed
insurance company or a surplus lines broker for coverage of risks resident or located in
Minnesota by a purchasing group or any members of the purchasing group to a broker or
agent for the purchasing group.
deleted text end

(b) A tax is imposed on a joint self-insurance plan operating under chapter 60F. The
rate of tax is equal to two percent of the total amount of claims paid during the fund year,
with no deduction for claims wholly or partially reimbursed through stop-loss insurance.

(c) A tax is imposed on a joint self-insurance plan operating under chapter 62H.
The rate of tax is equal to two percent of the total amount of claims paid during the
fund's fiscal year, with no deduction for claims wholly or partially reimbursed through
stop-loss insurance.

(d) A tax is imposed equal to the tax imposed under section 297I.05, subdivision 5,
on the gross premiums less return premiums on all coverages received by an accountable
provider network or agents of an accountable provider network in Minnesota, in cash or
otherwise, during the year.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for premiums received after
December 31, 2012.
new text end

Sec. 9.

new text begin [297I.11] AUTOMOBILE THEFT PREVENTION SURCHARGE.
new text end

new text begin Subdivision 1. new text end

new text begin Surcharge. new text end

new text begin Each insurer engaged in the writing of policies of
automobile insurance shall collect a surcharge, at the rate of 50 cents per vehicle
for every six months of coverage, on each policy of automobile insurance providing
comprehensive insurance coverage issued or renewed in this state. The surcharge may not
be considered premium for any purpose, including the computation of premium tax or
agents' commissions. The amount of the surcharge must be separately stated on either a
billing or policy declaration sent to an insured. Insurers shall remit the revenue derived
from this surcharge to the commissioner of revenue for purposes of the automobile theft
prevention program described in section 65B.84. For purposes of this subdivision, "policy
of automobile insurance" has the meaning given it in section 65B.14, covering only the
following types of vehicles as defined in section 168.002:
new text end

new text begin (1) a passenger automobile;
new text end

new text begin (2) a pickup truck;
new text end

new text begin (3) a van but not commuter vans as defined in section 168.126; or
new text end

new text begin (4) a motorcycle,
new text end

new text begin except that no vehicle with a gross vehicle weight in excess of 10,000 pounds is included
within this definition.
new text end

new text begin Subd. 2. new text end

new text begin Automobile theft prevention account. new text end

new text begin A special revenue account in
the state treasury shall be credited with the proceeds of the surcharge imposed under
subdivision 1. Of the revenue in the account, $1,300,000 each year must be transferred to
the general fund. Revenues in excess of $1,300,000 each year may be used only for the
automobile theft prevention program described in section 65B.84.
new text end

new text begin Subd. 3. new text end

new text begin Collection and administration. new text end

new text begin The commissioner shall collect and
administer the surcharge imposed by this section in the same manner as the taxes imposed
by this chapter. The commissioner is appropriated annually, from the automobile theft
prevention special revenue account, an amount to reimburse the Department of Revenue
for the costs incurred in administering and collecting the surcharge imposed under
subdivision 1.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for premiums collected after June
30, 2012.
new text end

Sec. 10.

Minnesota Statutes 2011 Supplement, section 297I.30, subdivision 1, is
amended to read:


Subdivision 1.

General rule.

On or before March 1, every taxpayer subject to
taxation under section 297I.05, subdivisions 1 to 5deleted text begin ,deleted text end new text begin ;new text end 7, paragraph (b)deleted text begin ,deleted text end new text begin ;new text end 12deleted text begin , paragraphs (a),
clauses (1) to (4), (b), (c), and (d),
deleted text end new text begin ;new text end and 14, shall file an annual return for the preceding
calendar year in the form prescribed by the commissioner.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for premiums received after
December 31, 2012.
new text end

Sec. 11.

Minnesota Statutes 2011 Supplement, section 297I.30, subdivision 2, is
amended to read:


Subd. 2.

Surplus lines brokers deleted text begin and purchasing groupsdeleted text end .

On or before February
15 and August 15 of each year, every surplus lines broker subject to taxation under
section 297I.05, subdivision 7, paragraph (a), deleted text begin and every purchasing group or member of
a purchasing group subject to tax under section 297I.05, subdivision 12, paragraph (a),
clause (5),
deleted text end shall file a return with the commissioner for the preceding six-month period
ending December 31, or June 30, in the form prescribed by the commissioner.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for premiums received after
December 31, 2012.
new text end

Sec. 12.

Minnesota Statutes 2010, section 297I.30, is amended by adding a subdivision
to read:


new text begin Subd. 10. new text end

new text begin Automobile theft prevention surcharge. new text end

new text begin On or before May 1, August
1, November 1, and February 1 of each year, every insurer required to pay the surcharge
under section 297I.11 shall file a return with the commissioner for the preceding
three-month period ending March 31, June 30, September 30, and December 31, in the
form prescribed by the commissioner.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for premiums collected after June
30, 2012.
new text end

Sec. 13.

Minnesota Statutes 2010, section 383A.80, subdivision 4, is amended to read:


Subd. 4.

Expiration.

The authority to impose the tax under this section expires
January 1, deleted text begin 2013deleted text end new text begin 2015new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 14.

Minnesota Statutes 2010, section 383B.80, subdivision 4, is amended to read:


Subd. 4.

Expiration.

The authority to impose the tax under this section expires
January 1, deleted text begin 2013deleted text end new text begin 2015new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 15.

Laws 2011, First Special Session chapter 7, article 10, section 7, is amended to
read:


Sec. 7. PURPOSE STATEMENTS; TAX EXPENDITURES.

Subdivision 1.

Authority.

This section is intended to fulfill the requirement under
Minnesota Statutes, section 3.192, that a bill creating, renewing, or continuing a tax
expenditure provide a purpose for the tax expenditure and a standard or goal against
which its effectiveness may be measured.

Subd. 2.

Estate tax exclusion for qualified farm and small business property.

The provisions of article 1, sections 3 through 8, providing an estate tax subtraction of
the combined value of qualified farm property and qualified small business property up
to $4,000,000 from the federal adjusted taxable estate, are intended to provide estate tax
reductions to owner-operators of family farms and small businesses to allow retention and
continued operation of those farms and businesses by the families.

Subd. 3.

Federal update.

The provisions of article 2, conforming Minnesota
individual income, corporate franchise, and estate taxes to changes in federal law, are
intended to simplify compliance with and administration of those taxes.

Subd. 4.

Sales tax exemption for ring tones.

The provisions of article 3, section 1,
exempting ring tones from sales taxation are intended (1) to bring the state of Minnesota
into compliance with the requirements of the streamlined sales tax agreement and (2) to
simplify the tax and to make compliance with the sales tax by remote sellers easier to
encourage congress to enact federal legislation allowing state and local governments to
require remote sellers to collect use tax on behalf of the state and its local governments.

Subd. 5.

new text begin Materials used in new text end minerals processing deleted text begin equipmentdeleted text end .

The provisions of
article 3, section 6, extending the sales tax exemption for certain deleted text begin equipmentdeleted text end new text begin milling and
grinding materials
new text end used in processing deleted text begin ofdeleted text end minerals is intended to provide sales tax treatment
for the nonferrous mining industry equivalent to that provided to the taconite mining
industry. Because these purchases are intermediate inputs to production, the legislature
does not consider this allowance to be a tax expenditure.

Subd. 6.

Sales tax deleted text begin exemption fordeleted text end new text begin onnew text end resold admission tickets.

The provisions
of article 3, section 8, deleted text begin providing an exemption for resold admission tickets bydeleted text end allowing
resale ticket sellersnew text begin (ticket resellers)new text end to claim a refund or provide a credit to the purchaser
of resold tickets for the value of sales tax paid on the original ticket, is intended to reduce
the competitive advantage of ticket resellers that do not have nexus in Minnesota deleted text begin requiring
them to collect Minnesota sales tax and to ensure
deleted text end new text begin while ensuringnew text end that deleted text begin resolddeleted text end new text begin the overall
sales tax remitted on
new text end admission ticketsnew text begin thatnew text end are deleted text begin subject todeleted text end new text begin sold to individuals or ticket
resellers, and then finally resold by ticket resellers, equals or exceeds
new text end sales tax deleted text begin onlydeleted text end on the
deleted text begin full,deleted text end new text begin sales price on thenew text end final retail deleted text begin pricedeleted text end new text begin salenew text end of the tickets. As a result, the legislature does
not consider this to be a tax expenditure.

Subd. 7.

Sales tax exemption for sales to townships.

The provisions of article 3,
sections 10 and 11, exempting goods and services purchased by townships, is intended
to provide state assistance for the functions of Minnesota townships not exempted under
current law.

Subd. 8.

Sales tax exemption; water purchases.

The provisions of article 3,
section 11, exempting water purchases by fire departments, fire protection districts, and
fire companies is intended to provide state assistance for this public safety function
of Minnesota local governments.

Subd. 9.

Emergency vehicles.

The provisions of article 3, section 12, extending
the sales tax exemption for lease of ambulances to other emergency vehicles are intended
to clarify the exemption and to provide consistent treatment of emergency vehicles. The
underlying purpose of the exemption is to provide state assistance to local governments
and other organizations that provide emergency response services.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective retroactively from July 21, 2011.
new text end

Sec. 16. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2010, section 168A.40, subdivisions 3 and 4, new text end new text begin are repealed.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for premiums collected after June
30, 2012.
new text end

ARTICLE 5

DEPARTMENT POLICY AND TECHNICAL: MINERALS

Section 1.

Minnesota Statutes 2011 Supplement, section 272.02, subdivision 97,
is amended to read:


Subd. 97.

Property used in business of mining subject to net proceeds tax.

The
following property used in the business of mining that is subject to the net proceeds tax
under section 298.015 is exempt:

(1) deposits of ores, metals, and minerals and the lands in which they are contained;

(2) all real and personal property used in mining, quarrying, producing, or refining
ores, minerals, or metals, including lands occupied by or used in connection with the
mining, quarrying, production, or ore refining facilities; and

(3) concentrate deleted text begin or direct reduced oredeleted text end .

This exemption applies for each year that a person subject to tax under section
298.015 uses the property for mining, quarrying, producing, or refining ores, metals, or
minerals.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 2.

Minnesota Statutes 2011 Supplement, section 298.01, subdivision 3, is
amended to read:


Subd. 3.

Occupation tax; other ores.

Every person engaged in the business of
mining, refining, or producing ores, metals, or minerals in this state, except iron ore or
taconite concentrates, shall pay an occupation tax to the state of Minnesota as provided
in this subdivision. For purposes of this subdivision, mining includes the application of
hydrometallurgical processes.new text begin Hydrometallurgical processes are processes that extract
the ores, metals, or minerals, by use of aqueous solutions that leach, concentrate, and
recover the ore, metal, or mineral.
new text end The tax is determined in the same manner as the tax
imposed by section 290.02, except that sections 290.05, subdivision 1, clause (a), 290.17,
subdivision 4
, and 290.191, subdivision 2, do not apply, and the occupation tax must
be computed by applying to taxable income the rate of 2.45 percent. A person subject
to occupation tax under this section shall apportion its net income on the basis of the
percentage obtained by taking the sum of:

(1) 75 percent of the percentage which the sales made within this state in connection
with the trade or business during the tax period are of the total sales wherever made in
connection with the trade or business during the tax period;

(2) 12.5 percent of the percentage which the total tangible property used by the
taxpayer in this state in connection with the trade or business during the tax period is of
the total tangible property, wherever located, used by the taxpayer in connection with the
trade or business during the tax period; and

(3) 12.5 percent of the percentage which the taxpayer's total payrolls paid or incurred
in this state or paid in respect to labor performed in this state in connection with the trade
or business during the tax period are of the taxpayer's total payrolls paid or incurred in
connection with the trade or business during the tax period.

The tax is in addition to all other taxes.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 3.

Minnesota Statutes 2010, section 298.018, subdivision 2, is amended to read:


Subd. 2.

Outside taconite assistance area.

The proceeds of the tax paid under
sections 298.015 to 298.017 on new text begin ores, metals, or new text end minerals deleted text begin and energy resourcesdeleted text end mined
or extracted outside of the taconite assistance area defined in section 273.1341, shall
be deposited in the general fund.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

ARTICLE 6

DEPARTMENT POLICY AND TECHNICAL: MISCELLANEOUS

Section 1.

Minnesota Statutes 2010, section 16A.46, is amended to read:


16A.46 LOST OR DESTROYED WARRANT DUPLICATE; INDEMNITY.

new text begin Subdivision 1. new text end

new text begin Duplicate warrant. new text end

The commissioner may issue a duplicate
of an unpaid warrant to an owner if the owner certifies that the original was lost or
destroyed. The commissioner may require certification be documented by affidavit.new text begin
The commissioner may refuse to issue a duplicate of an unpaid state warrant. If the
commissioner acts in good faith the commissioner is not liable, whether the application is
granted or denied.
new text end

new text begin Subd. 2. new text end

new text begin Original warrant is void. new text end

When the duplicate is issued, the original is
void. The commissioner may require an indemnity bond from the applicant to the state for
double the amount of the warrant for anyone damaged by the issuance of the duplicate.
The commissioner deleted text begin may refuse to issue a duplicate of an unpaid state warrant. If the
commissioner acts in good faith the commissioner is not liable, whether the application is
granted or denied
deleted text end new text begin is not liable to any holder who took the void original warrant for value,
whether the commissioner required an indemnity bond from the applicant or not
new text end .

new text begin Subd. 3. new text end

new text begin Unpaid refund or rebate. new text end

For an unpaid refund or rebate issued under a
tax law administered by the commissioner of revenue that has been lost or destroyed, an
affidavit is not required for the commissioner to issue a duplicate if the duplicate is issued
to the same name and Social Security number as the original warrant and that information
is verified on a tax return filed by the recipient.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 2.

Minnesota Statutes 2010, section 270C.38, subdivision 1, is amended to read:


Subdivision 1.

Sufficient notice.

new text begin (a) new text end If no method of notification of a written
determination or action of the commissioner is otherwise specifically provided for by
law, notice of the determination or action sent postage prepaid by United States mail to
the taxpayer or other person affected by the determination or action at the taxpayer's
or person's last known address, is sufficient. If the taxpayer or person being notified is
deceased or is under a legal disability, or, in the case of a corporation being notified that
has terminated its existence, notice to the last known address of the taxpayer, person, or
corporation is sufficient, unless the department has been provided with a new address by a
party authorized to receive notices from the commissioner.

new text begin (b) If a taxpayer or other person agrees to accept notification by electronic means,
notice of a determination or action of the commissioner sent by electronic mail to the
taxpayer's or person's last known electronic mailing address as provided for in section
325L.08 is sufficient.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 3.

Minnesota Statutes 2010, section 270C.42, subdivision 2, is amended to read:


Subd. 2.

Penalty for failure to pay electronically.

In addition to other applicable
penalties imposed by law, after notification from the commissioner to the taxpayer that
payments for a tax payable to the commissioner are required to be made by electronic
means, and the payments are remitted by some other means, there is a penalty in the
amount of five percent of each payment that should have been remitted electronically.
After the commissioner's initial notification to the taxpayer that payments are required to
be made by electronic means, the commissioner is not required to notify the taxpayer in
subsequent periods if the initial notification specified the amount of tax liability at which a
taxpayer is required to remit payments by electronic means. The penalty can be abated
under the abatement procedures prescribed in section 270C.34 if the failure to remit the
payment electronically is due to reasonable cause. The penalty bears interest at the rate
specified in section 270C.40 from the deleted text begin duedeleted text end date deleted text begin of the payment of the taxdeleted text end new text begin provided in
section 270C.40, subdivision 3,
new text end to the date of payment of the penalty.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 4.

Minnesota Statutes 2010, section 270C.69, subdivision 1, is amended to read:


Subdivision 1.

Notice and procedures.

(a) The commissioner may, within five years
after the date of assessment of the tax, or if a lien has been filed under section 270C.63,
within the statutory period for enforcement of the lien, give notice to any employer
deriving income which has a taxable situs in this state regardless of whether the income is
exempt from taxation, that an employee of that employer is delinquent in a certain amount
with respect to any taxes, including penalties, interest, and costs. The commissioner can
proceed under this section only if the tax is uncontested or if the time for appeal of the tax
has expired. The commissioner shall not proceed under this section until the expiration of
30 days after mailing to the taxpayer, at the taxpayer's last known address, a written notice
of (1) the amount of taxes, interest, and penalties due from the taxpayer and demand for
their payment, and (2) the commissioner's intention to require additional withholding by
the taxpayer's employer pursuant to this section. The effect of the notice shall expire one
year after it has been mailed to the taxpayer provided that the notice may be renewed by
mailing a new notice which is in accordance with this section. The renewed notice shall
have the effect of reinstating the priority of the original claim. The notice to the taxpayer
shall be in substantially the same form as that provided in section 571.72. The notice
shall further inform the taxpayer of the wage exemptions contained in section 550.37,
subdivision 14
. If no statement of exemption is received by the commissioner within 30
days from the mailing of the notice, the commissioner may proceed under this section.
The notice to the taxpayer's employer may be served by mail or by delivery by an agent of
the department and shall be in substantially the same form as provided in section 571.75.
Upon receipt of notice, the employer shall withhold from compensation due or to become
due to the employee, the total amount shown by the notice, subject to the provisions of
section 571.922. The employer shall continue to withhold each pay period until the notice
is released by the commissioner under section 270C.7109. Upon receipt of notice by the
employer, the claim of the state of Minnesota shall have priority over any subsequent
garnishments or wage assignments. The commissioner may arrange between the employer
and the employee for withholding a portion of the total amount due the employee each pay
period, until the total amount shown by the notice plus accrued interest has been withheld.

(b) The "compensation due" any employee is defined in accordance with the
provisions of section 571.921. The maximum withholding allowed under this section for
any one pay period shall be decreased by any amounts payable pursuant to a garnishment
action with respect to which the employer was served prior to being served with the notice
of delinquency and any amounts covered by any irrevocable and previously effective
assignment of wages; the employer shall give notice to the commissioner of the amounts
and the facts relating to such assignments within ten days after the service of the notice of
delinquency on the form provided by the commissioner as noted in this section.

(c) Within ten days after the expiration of such pay period, the employer shall remit
to the commissioner, on a form and in the manner prescribed by the commissioner, the
amount withheld during each pay period under this section.new text begin The employer must file all
wage levy disclosure forms and remit all wage levy payments by electronic means. The
requirement in this section to use electronic means may be waived by the commissioner
if the commissioner determines that the requirement causes an undue hardship. The
employer must request the waiver in the form and manner prescribed by the commissioner
before making their payment or submitting their disclosure form by mail. In determining
whether the electronic means requirement causes an undue hardship the commissioner
may consider unusual circumstances which may prevent the employer from using
electronic means and any other factor that the commissioner determines is pertinent.
"Unusual circumstances" includes not having access to a telephone or a computer, being
physically unable to use a telephone or a computer, or the telephone or computer system
available to the employer is incompatible with the department's system used for electronic
filing or payments.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for wage levy disclosures or wage
levy payments filed or made after December 31, 2012.
new text end

Sec. 5.

Minnesota Statutes 2010, section 287.385, subdivision 7, is amended to read:


Subd. 7.

Interest on penalties.

A penalty imposed under this chapter bears interest
from the date deleted text begin payment was required to be paid, including any extensions,deleted text end new text begin provided in
section 270C.40, subdivision 3,
new text end to the date of payment of the penalty.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 6.

Minnesota Statutes 2010, section 289A.55, subdivision 9, is amended to read:


Subd. 9.

Interest on penalties.

(a) A penalty imposed under section 289A.60,
subdivision 1
, 2, 2a, 4, 5, 6, or 21 bears interest from the date deleted text begin the return or payment
was required to be filed or paid, including any extensions
deleted text end new text begin provided in section 270C.40,
subdivision 3
new text end , to the date of payment of the penalty.

(b) A penalty not included in paragraph (a) bears interest only if it is not paid within
60 days from the date of notice. In that case interest is imposed from the date of notice
to the date of payment.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 7.

Minnesota Statutes 2010, section 289A.60, subdivision 4, is amended to read:


Subd. 4.

Substantial understatement of liability; penalty.

(a) The commissioner
of revenue shall impose a penalty for substantial understatement of any tax payable to the
commissioner, except a tax imposed under chapter 297A.

(b) There must be added to the tax an amount equal to 20 percent of the amount of any
underpayment attributable to the understatement. There is a substantial understatement of
tax for the period if the amount of the understatement for the period exceeds the greater of:

(1) ten percent of the tax required to be shown on the return for the period; or

(2)(i) $10,000 in the case of a mining company or a corporation, other than an S
corporation as defined in section 290.9725, when the tax is imposed by chapter 290 or
section 298.01 or 298.015, or

(ii) $5,000 in the case of any other taxpayer, and in the case of a mining company or
a corporation any tax not imposed by chapter 290 or section 298.01 or 298.015.

(c) For a corporation, other than an S corporation, there is also a substantial
understatement of tax for any taxable year if the amount of the understatement for the
taxable year exceeds the lesser of:

(1) ten percent of the tax required to be shown on the return for the taxable year
(or, if greater, $10,000); or

(2) $10,000,000.

(d) The term "understatement" means the excess of the amount of the tax required
to be shown on the return for the period, over the amount of the tax imposed that is
shown on the return. The excess must be determined without regard to items to which
subdivision 27 applies. The amount of the understatement shall be reduced by that part of
the understatement that is attributable to the tax treatment of any item by the taxpayer if
(1) there is or was substantial authority for the treatment, or (2)(i) any item with respect to
which the relevant facts affecting the item's tax treatment are adequately disclosed in the
return or in a statement attached to the return and (ii) there is a reasonable basis for the tax
treatment of the item. The exception for substantial authority under clause (1) does not
apply to positions listed by the Secretary of the Treasury under section 6662(d)(3) of the
Internal Revenue Code. A corporation does not have a reasonable basis for its tax treatment
of an item attributable to a multiple-party financing transaction if the treatment does not
clearly reflect the income of the corporation within the meaning of section 6662(d)(2)(B)
of the Internal Revenue Code. The special rules in cases involving tax shelters provided in
section 6662(d)(2)(C) of the Internal Revenue Code shall apply and shall apply to a tax
shelter the principal purpose of which is the avoidance or evasion of state taxes.

(e) The commissioner may abate all or any part of the addition to the tax provided
by this section on a showing by the taxpayer that there was reasonable cause for the
understatement, or part of it, and that the taxpayer acted in good faith. The additional tax
and penalty shall bear interest deleted text begin at the ratedeleted text end new text begin asnew text end specified in section 270C.40 deleted text begin from the time
the tax should have been paid
deleted text end until paid.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 8.

Minnesota Statutes 2010, section 296A.22, is amended to read:


296A.22 NONPAYMENT OF TAX; CIVIL PENALTIES.

Subdivision 1.

Penalty for failure to pay tax, general rule.

Upon the failure of
any person to pay any tax or fee when due, a penalty of one percent per day for the first
ten days of delinquency shall accrue, and thereafter the tax, fees, and penalty shall bear
interest at the rate specified in section 270C.40new text begin until paidnew text end .

Subd. 2.

Collection authority.

Upon such a failure to pay any tax or fees within the
time provided by this chapter, all taxes and fees imposed by this chapter shall become
immediately due and payable, and may be collected as provided in chapter 270C.

Subd. 3.

Operating without license.

If any person operates as a distributor, special
fuel dealer, bulk purchaser, or motor carrier without first securing the license required
under this chapter, any tax or fee imposed by this chapter shall become immediately due
and payable. A penalty of 25 percent is imposed upon the tax and fee due. The taxdeleted text begin ,deleted text end new text begin andnew text end
feesdeleted text begin , and penaltydeleted text end shall bear interest at the rate specified in section 270C.40.new text begin The penalty
imposed in this subdivision shall bear interest from the date provided in section 270C.40,
subdivision 3, to the date of payment of the penalty.
new text end

Subd. 4.

Unlawful use of dyed fuel.

(a) If any dyed fuel is sold or held for sale by a
person for any use which the person knows or has reason to know is not a nontaxable use
of the fuel; or if any dyed fuel is held for use or used in a licensed motor vehicle or for any
other use by a person for a use other than a nontaxable use and the person knew, or had
reason to know, that the fuel was so dyed; or if a person willfully alters, or attempts to
alter, the strength or composition of any dye or marking in any dyed fuel, then the person
shall pay a penalty in addition to the tax, if any.

(b) Except as provided in paragraph (c), the amount of penalty under paragraph (a)
for each act is the greater of $1,000, or $10 for each gallon of dyed fuel involved.

(c) With regard to a multiple violation under paragraph (a), the penalty shall be
applied by increasing the amount in paragraph (b) by the product of (1) such amount, and
(2) the number of prior penalties, if any, imposed by this section on the person, or a related
person, or any predecessor of the person or related person.

(d) If a penalty is imposed under this subdivision on a business entity, each officer,
employee, or agent of the entity who willfully participated in any act giving rise to the
penalty is jointly and severally liable with the entity for the penalty.

Subd. 5.

Receiver appointed.

In the event a suit is instituted as provided in
subdivision 2, the court shall, upon application, appoint a receiver of the property and
business of the delinquent defendant for the purpose of impounding the same as security
for any judgment which has been or may be recovered.

Subd. 6.

Sale prohibited under certain conditions.

No petroleum product shall
be unloaded or sold by any person or distributor whose tax and fees are the basis for
collection action under subdivision 2.

Subd. 7.

Payment of penalties.

The penalties imposed by this section are collected
and paid in the same manner as taxes.

Subd. 8.

Penalties are additional.

The civil penalties imposed by this section are in
addition to the criminal penalties imposed by this chapter.

Subd. 9.

Abatement of penalty.

(a) The commissioner may by written order
abate any penalty imposed under this section, if in the commissioner's opinion there is
reasonable cause to do so.

(b) A request for abatement of penalty must be filed with the commissioner within
60 days of the date the notice stating that a penalty has been imposed was mailed to
the taxpayer's last known address.

(c) If the commissioner issues an order denying a request for abatement of penalty,
the taxpayer may file an administrative appeal as provided in section 270C.35 or appeal to
Tax Court as provided in section 271.06. If the commissioner does not issue an order on
the abatement request within 60 days from the date the request is received, the taxpayer
may appeal to Tax Court as provided in section 271.06.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 9.

Minnesota Statutes 2010, section 297E.14, subdivision 7, is amended to read:


Subd. 7.

Interest on penalties.

(a) A penalty imposed under section 297E.12,
subdivision 1
, 2, 3, 4, or 5, bears interest from the date deleted text begin the return or payment was required
to be filed or paid, including any extensions
deleted text end new text begin provided in section 270C.40, subdivision 3new text end , to
the date of payment of the penalty.

(b) A penalty not included in paragraph (a) bears interest only if it is not paid within
ten days from the date of notice. In that case interest is imposed from the date of notice
to the date of payment.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 10.

Minnesota Statutes 2010, section 297F.09, subdivision 9, is amended to read:


Subd. 9.

Interest.

The amount of tax not timely paiddeleted text begin , together with any penalty
imposed in this section,
deleted text end bears interest at the rate specified in section 270C.40 from the
time such tax should have been paid until paid. new text begin The penalty imposed in this section bears
interest from the date provided in section 270C.40, subdivision 3, to the date of payment
of the penalty.
new text end Any interest and penalty is added to the tax and collected as a part of it.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 11.

Minnesota Statutes 2010, section 297F.18, subdivision 7, is amended to read:


Subd. 7.

Interest on penalties.

(a) A penalty imposed under section 297F.19,
subdivisions 2 to 7
, bears interest from the date deleted text begin the return or payment was required to be
filed or paid, including any extensions
deleted text end new text begin provided in section 270C.40, subdivision 3new text end , to the
date of payment of the penalty.

(b) A penalty not included in paragraph (a) bears interest only if it is not paid within
ten days from the date of the notice. In that case interest is imposed from the date of notice
to the date of payment.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 12.

Minnesota Statutes 2010, section 297G.09, subdivision 8, is amended to read:


Subd. 8.

Interest.

The amount of tax not timely paiddeleted text begin , together with any penalty
imposed by this chapter,
deleted text end bears interest at the rate specified in section 270C.40 from the
time the tax should have been paid until paid. new text begin Any penalty imposed by this chapter bears
interest from the date provided in section 270C.40, subdivision 3, to the date of payment
of the penalty.
new text end Any interest and penalty is added to the tax and collected as a part of it.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 13.

Minnesota Statutes 2010, section 297G.17, subdivision 7, is amended to read:


Subd. 7.

Interest on penalties.

(a) A penalty imposed under section 297G.18,
subdivisions 2 to 7
, bears interest from the date deleted text begin the return or payment was required to be
filed or paid, including any extensions
deleted text end new text begin provided in section 270C.40, subdivision 3new text end , to the
date of payment of the penalty.

(b) A penalty not included in paragraph (a) bears interest only if it is not paid within
ten days from the date of the notice. In that case interest is imposed from the date of notice
to the date of payment.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 14.

Minnesota Statutes 2010, section 297I.80, subdivision 1, is amended to read:


Subdivision 1.

Payable to commissioner.

(a) When interest is required under this
section, interest is computed at the rate specified in section 270C.40.

(b) If a tax or surcharge is not paid within the time named by law for payment, the
unpaid tax or surcharge bears interest from the date the tax or surcharge should have been
paid until the date the tax or surcharge is paid.

(c) Whenever a taxpayer is liable for additional tax or surcharge because of a
redetermination by the commissioner or other reason, the additional tax or surcharge
bears interest from the time the tax or surcharge should have been paid until the date the
tax or surcharge is paid.

(d) A penalty bears interest from the date deleted text begin the return or payment was required to be
filed or paid
deleted text end new text begin provided in section 270C.40, subdivision 3,new text end to the date of payment of the
penalty.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

ARTICLE 7

ECONOMIC DEVELOPMENT PROVISIONS CLEANUP

Section 1.

Minnesota Statutes 2010, section 16C.16, subdivision 7, is amended to read:


Subd. 7.

Economically disadvantaged areas.

(a) Except as otherwise provided in
paragraph (b), the commissioner may award up to a six percent preference in the amount
bid on state procurement to small businesses located in an economically disadvantaged
area.

(b) The commissioner may award up to a four percent preference in the amount bid
on state construction to small businesses located in an economically disadvantaged area.

(c) A business is located in an economically disadvantaged area if:

(1) the owner resides in or the business is located in a county in which the median
income for married couples is less than 70 percent of the state median income for married
couples;

(2) the owner resides in or the business is located in an area designated a labor
surplus area by the United States Department of Labor; or

(3) the business is a certified rehabilitation facility or extended employment provider
as described in chapter 268A.

(d) The commissioner may designate one or more areas designated as targeted
neighborhoods under section 469.202 or as new text begin border city new text end enterprise zones under section
deleted text begin 469.167deleted text end new text begin 469.166new text end as economically disadvantaged areas for purposes of this subdivision
if the commissioner determines that this designation would further the purposes of this
section. If the owner of a small business resides or is employed in a designated area, the
small business is eligible for any preference provided under this subdivision.

(e) The Department of Revenue shall gather data necessary to make the
determinations required by paragraph (c), clause (1), and shall annually certify counties
that qualify under paragraph (c), clause (1). An area designated a labor surplus area
retains that status for 120 days after certified small businesses in the area are notified of
the termination of the designation by the United States Department of Labor.

Sec. 2.

Minnesota Statutes 2010, section 41A.036, subdivision 2, is amended to read:


Subd. 2.

Small business development loans; preferences.

The following eligible
small businesses have preference among all business applicants for small business
development loans:

(1) businesses located in rural areas of the state that are experiencing the most
severe unemployment rates in the state;

(2) businesses that are likely to expand and provide additional permanent
employment in rural areas of the state, or enhance the quality of existing jobs in those
areas;

(3) businesses located in border communities that experience a competitive
disadvantage due to location;

(4) businesses that have been unable to obtain traditional financial assistance due to
a disadvantageous location, minority ownership, or other factors rather than due to the
business having been considered a poor financial risk;

(5) businesses that utilize state resources and reduce state dependence on outside
resources, and that produce products or services consistent with the long-term social and
economic needs of the state; and

(6) businesses located in deleted text begin designateddeleted text end new text begin border citynew text end enterprise zones, as described in
section deleted text begin 469.168deleted text end new text begin 469.166new text end .

Sec. 3.

Minnesota Statutes 2010, section 117.025, subdivision 10, is amended to read:


Subd. 10.

Public service corporation.

"Public service corporation" means a
utility, as defined by section 216E.01, subdivision 10; gas, electric, telephone, or cable
communications company; cooperative association; natural gas pipeline company;
crude oil or petroleum products pipeline company; municipal utility; municipality when
operating its municipally owned utilities; joint venture created pursuant to section 452.25
or 452.26; or municipal power or gas agency. Public service corporation also means a
municipality or public corporation when operating an airport under chapter 360 or 473, a
common carrier, a watershed district, or a drainage authority. deleted text begin Public service corporation
also means an entity operating a regional distribution center within an international
economic development zone designated under section 469.322.
deleted text end

Sec. 4.

Minnesota Statutes 2010, section 270B.14, subdivision 3, is amended to read:


Subd. 3.

Administration of enterprise, job opportunity, and biotechnology
and health sciences industry zone programs.

The commissioner may disclose return
information relating to the taxes imposed by chapters 290 and 297A to the Department of
Employment and Economic Development or a municipality deleted text begin receiving andeleted text end new text begin with a border
city
new text end enterprise zone deleted text begin designationdeleted text end new text begin as defined new text end under section deleted text begin 469.169deleted text end new text begin 469.166,new text end but only as
necessary to administer the funding limitations under section 469.169deleted text begin , subdivision 7deleted text end , or
to the Department of Employment and Economic Development and appropriate officials
from the local government units in which a qualified business is located but only as
necessary to enforce the job opportunity building zone benefits under section 469.315, or
biotechnology and health sciences industry zone benefits under section 469.336.

Sec. 5.

Minnesota Statutes 2010, section 272.02, subdivision 77, is amended to read:


Subd. 77.

Property of housing and redevelopment authorities.

Property of
projects of housing and redevelopment authorities are exempt to the extent permitted by
deleted text begin sectionsdeleted text end new text begin sectionnew text end 469.042, subdivision 1deleted text begin , and 469.043, subdivisions 2 and 5deleted text end .

Sec. 6.

Minnesota Statutes 2010, section 273.13, subdivision 24, is amended to read:


Subd. 24.

Class 3.

deleted text begin (a)deleted text end Commercial and industrial property and utility real and
personal property is class 3a.

(1) Except as otherwise provided, each parcel of commercial, industrial, or utility
real property has a class rate of 1.5 percent of the first tier of market value, and 2.0 percent
of the remaining market value. In the case of contiguous parcels of property owned by the
same person or entity, only the value equal to the first-tier value of the contiguous parcels
qualifies for the reduced class rate, except that contiguous parcels owned by the same
person or entity shall be eligible for the first-tier value class rate on each separate business
operated by the owner of the property, provided the business is housed in a separate
structure. For the purposes of this subdivision, the first tier means the first $150,000 of
market value. Real property owned in fee by a utility for transmission line right-of-way
shall be classified at the class rate for the higher tier.

For purposes of this subdivision, parcels are considered to be contiguous even if
they are separated from each other by a road, street, waterway, or other similar intervening
type of property. Connections between parcels that consist of power lines or pipelines do
not cause the parcels to be contiguous. Property owners who have contiguous parcels of
property that constitute separate businesses that may qualify for the first-tier class rate shall
notify the assessor by July 1, for treatment beginning in the following taxes payable year.

(2) All personal property that is: (i) part of an electric generation, transmission, or
distribution system; or (ii) part of a pipeline system transporting or distributing water, gas,
crude oil, or petroleum products; and (iii) not described in clause (3), and all railroad
operating property has a class rate as provided under clause (1) for the first tier of market
value and the remaining market value. In the case of multiple parcels in one county that
are owned by one person or entity, only one first tier amount is eligible for the reduced rate.

(3) The entire market value of personal property that is: (i) tools, implements, and
machinery of an electric generation, transmission, or distribution system; (ii) tools,
implements, and machinery of a pipeline system transporting or distributing water, gas,
crude oil, or petroleum products; or (iii) the mains and pipes used in the distribution of
steam or hot or chilled water for heating or cooling buildings, has a class rate as provided
under clause (1) for the remaining market value in excess of the first tier.

deleted text begin (b) Employment property defined in section 469.166, during the period provided
in section 469.170, shall constitute class 3b. The class rates for class 3b property are
determined under paragraph (a).
deleted text end

Sec. 7.

Minnesota Statutes 2010, section 273.1398, subdivision 4, is amended to read:


Subd. 4.

Disparity reduction credit.

(a) Beginning with taxes payable in 1989,
class 4a, new text begin and new text end class 3adeleted text begin , and class 3bdeleted text end property qualifies for a disparity reduction credit if: (1)
the property is located in a border city that has an enterprise zone deleted text begin designated pursuant to
section 469.168, subdivision 4
deleted text end new text begin , as defined in section 469.166new text end ; (2) the property is located
in a city with a population greater than 2,500 and less than 35,000 according to the
1980 decennial census; (3) the city is adjacent to a city in another state or immediately
adjacent to a city adjacent to a city in another state; and (4) the adjacent city in the
other state has a population of greater than 5,000 and less than 75,000 according to the
1980 decennial census.

(b) The credit is an amount sufficient to reduce (i) the taxes levied on class 4a
property to 2.3 percent of the property's market value and (ii) the tax on class 3a deleted text begin and class
3b
deleted text end property to 2.3 percent of market value.

(c) The county auditor shall annually certify the costs of the credits to the
Department of Revenue. The department shall reimburse local governments for the
property taxes forgone as the result of the credits in proportion to their total levies.

Sec. 8.

Minnesota Statutes 2010, section 276A.01, subdivision 3, is amended to read:


Subd. 3.

Commercial-industrial property.

"Commercial-industrial property"
means the following categories of property, as defined in section 273.13, excluding that
portion of the property (i) that may, by law, constitute the tax base for a tax increment
pledged pursuant to deleted text begin section 469.042 or 469.162 ordeleted text end sections 469.174 to 469.178,
certification of which was requested prior to May 1, 1996, to the extent and while the tax
increment is so pledged; or (ii) that is exempt from taxation under section 272.02:

(1) that portion of class 5 property consisting of unmined iron ore and low-grade
iron-bearing formations as defined in section 273.14, tools, implements, and machinery,
except the portion of high voltage transmission lines, the value of which is deducted from
net tax capacity under section 273.425; and

(2) that portion of class 3 and class 5 property which is either used or zoned for
use for any commercial or industrial purpose, including property that becomes taxable
under section 298.25, except for such property which is, or, in the case of property under
construction, will when completed be used exclusively for residential occupancy and
the provision of services to residential occupants thereof. Property must be considered
as used exclusively for residential occupancy only if each of not less than 80 percent
of its occupied residential units is, or, in the case of property under construction, will
when completed be occupied under an oral or written agreement for occupancy over a
continuous period of not less than 30 days.

If the classification of property prescribed by section 273.13 is modified by
legislative amendment, the references in this subdivision are to the successor class or
classes of property, or portions thereof, that include the kinds of property designated
in this subdivision.

Sec. 9.

Minnesota Statutes 2011 Supplement, section 290.01, subdivision 19b, is
amended to read:


Subd. 19b.

Subtractions from federal taxable income.

For individuals, estates,
and trusts, there shall be subtracted from federal taxable income:

(1) net interest income on obligations of any authority, commission, or
instrumentality of the United States to the extent includable in taxable income for federal
income tax purposes but exempt from state income tax under the laws of the United States;

(2) if included in federal taxable income, the amount of any overpayment of income
tax to Minnesota or to any other state, for any previous taxable year, whether the amount
is received as a refund or as a credit to another taxable year's income tax liability;

(3) the amount paid to others, less the amount used to claim the credit allowed under
section 290.0674, not to exceed $1,625 for each qualifying child in grades kindergarten
to 6 and $2,500 for each qualifying child in grades 7 to 12, for tuition, textbooks, and
transportation of each qualifying child in attending an elementary or secondary school
situated in Minnesota, North Dakota, South Dakota, Iowa, or Wisconsin, wherein a
resident of this state may legally fulfill the state's compulsory attendance laws, which
is not operated for profit, and which adheres to the provisions of the Civil Rights Act
of 1964 and chapter 363A. For the purposes of this clause, "tuition" includes fees or
tuition as defined in section 290.0674, subdivision 1, clause (1). As used in this clause,
"textbooks" includes books and other instructional materials and equipment purchased
or leased for use in elementary and secondary schools in teaching only those subjects
legally and commonly taught in public elementary and secondary schools in this state.
Equipment expenses qualifying for deduction includes expenses as defined and limited in
section 290.0674, subdivision 1, clause (3). "Textbooks" does not include instructional
books and materials used in the teaching of religious tenets, doctrines, or worship, the
purpose of which is to instill such tenets, doctrines, or worship, nor does it include books
or materials for, or transportation to, extracurricular activities including sporting events,
musical or dramatic events, speech activities, driver's education, or similar programs. No
deduction is permitted for any expense the taxpayer incurred in using the taxpayer's or
the qualifying child's vehicle to provide such transportation for a qualifying child. For
purposes of the subtraction provided by this clause, "qualifying child" has the meaning
given in section 32(c)(3) of the Internal Revenue Code;

(4) income as provided under section 290.0802;

(5) to the extent included in federal adjusted gross income, income realized on
disposition of property exempt from tax under section 290.491;

(6) to the extent not deducted or not deductible pursuant to section 408(d)(8)(E)
of the Internal Revenue Code in determining federal taxable income by an individual
who does not itemize deductions for federal income tax purposes for the taxable year, an
amount equal to 50 percent of the excess of charitable contributions over $500 allowable
as a deduction for the taxable year under section 170(a) of the Internal Revenue Code,
under the provisions of Public Law 109-1 and Public Law 111-126;

(7) for individuals who are allowed a federal foreign tax credit for taxes that do not
qualify for a credit under section 290.06, subdivision 22, an amount equal to the carryover
of subnational foreign taxes for the taxable year, but not to exceed the total subnational
foreign taxes reported in claiming the foreign tax credit. For purposes of this clause,
"federal foreign tax credit" means the credit allowed under section 27 of the Internal
Revenue Code, and "carryover of subnational foreign taxes" equals the carryover allowed
under section 904(c) of the Internal Revenue Code minus national level foreign taxes to
the extent they exceed the federal foreign tax credit;

(8) in each of the five tax years immediately following the tax year in which an
addition is required under subdivision 19a, clause (7), or 19c, clause (15), in the case
of a shareholder of a corporation that is an S corporation, an amount equal to one-fifth
of the delayed depreciation. For purposes of this clause, "delayed depreciation" means
the amount of the addition made by the taxpayer under subdivision 19a, clause (7), or
subdivision 19c, clause (15), in the case of a shareholder of an S corporation, minus the
positive value of any net operating loss under section 172 of the Internal Revenue Code
generated for the tax year of the addition. The resulting delayed depreciation cannot be
less than zero;

(9) job opportunity building zone income as provided under section 469.316;

(10) to the extent included in federal taxable income, the amount of compensation
paid to members of the Minnesota National Guard or other reserve components of the
United States military for active service, excluding compensation for services performed
under the Active Guard Reserve (AGR) program. For purposes of this clause, "active
service" means (i) state active service as defined in section 190.05, subdivision 5a, clause
(1); or (ii) federally funded state active service as defined in section 190.05, subdivision
5b
, but "active service" excludes service performed in accordance with section 190.08,
subdivision 3
;

(11) to the extent included in federal taxable income, the amount of compensation
paid to Minnesota residents who are members of the armed forces of the United States
or United Nations for active duty performed under United States Code, title 10; or the
authority of the United Nations;

(12) an amount, not to exceed $10,000, equal to qualified expenses related to a
qualified donor's donation, while living, of one or more of the qualified donor's organs
to another person for human organ transplantation. For purposes of this clause, "organ"
means all or part of an individual's liver, pancreas, kidney, intestine, lung, or bone marrow;
"human organ transplantation" means the medical procedure by which transfer of a human
organ is made from the body of one person to the body of another person; "qualified
expenses" means unreimbursed expenses for both the individual and the qualified donor
for (i) travel, (ii) lodging, and (iii) lost wages net of sick pay, except that such expenses
may be subtracted under this clause only once; and "qualified donor" means the individual
or the individual's dependent, as defined in section 152 of the Internal Revenue Code. An
individual may claim the subtraction in this clause for each instance of organ donation for
transplantation during the taxable year in which the qualified expenses occur;

(13) in each of the five tax years immediately following the tax year in which an
addition is required under subdivision 19a, clause (8), or 19c, clause (16), in the case of a
shareholder of a corporation that is an S corporation, an amount equal to one-fifth of the
addition made by the taxpayer under subdivision 19a, clause (8), or 19c, clause (16), in the
case of a shareholder of a corporation that is an S corporation, minus the positive value of
any net operating loss under section 172 of the Internal Revenue Code generated for the
tax year of the addition. If the net operating loss exceeds the addition for the tax year, a
subtraction is not allowed under this clause;

(14) to the extent included in the federal taxable income of a nonresident of
Minnesota, compensation paid to a service member as defined in United States Code, title
10, section 101(a)(5), for military service as defined in the Servicemembers Civil Relief
Act, Public Law 108-189, section 101(2);

(15) deleted text begin international economic development zone income as provided under section
469.325;
deleted text end

deleted text begin (16)deleted text end to the extent included in federal taxable income, the amount of national service
educational awards received from the National Service Trust under United States Code,
title 42, sections 12601 to 12604, for service in an approved Americorps National Service
program;

deleted text begin (17)deleted text end new text begin (16)new text end to the extent included in federal taxable income, discharge of indebtedness
income resulting from reacquisition of business indebtedness included in federal taxable
income under section 108(i) of the Internal Revenue Code. This subtraction applies only
to the extent that the income was included in net income in a prior year as a result of the
addition under section 290.01, subdivision 19a, clause (16); and

deleted text begin (18)deleted text end new text begin (17)new text end the amount of the net operating loss allowed under section 290.095,
subdivision
11, paragraph (c).

Sec. 10.

Minnesota Statutes 2010, section 290.01, subdivision 29, is amended to read:


Subd. 29.

Taxable income.

The term "taxable income" means:

(1) for individuals, estates, and trusts, the same as taxable net income;

(2) for corporations, the taxable net income less

(i) the net operating loss deduction under section 290.095;

(ii) the dividends received deduction under section 290.21, subdivision 4;

(iii) the exemption for operating in a job opportunity building zone under section
469.317;new text begin and
new text end

(iv) the exemption for operating in a biotechnology and health sciences industry
zone under section 469.337deleted text begin ; and
deleted text end

deleted text begin (v) the exemption for operating in an international economic development zone
under section 469.326
deleted text end .

Sec. 11.

Minnesota Statutes 2011 Supplement, section 290.06, subdivision 2c, is
amended to read:


Subd. 2c.

Schedules of rates for individuals, estates, and trusts.

(a) The income
taxes imposed by this chapter upon married individuals filing joint returns and surviving
spouses as defined in section 2(a) of the Internal Revenue Code must be computed by
applying to their taxable net income the following schedule of rates:

(1) On the first $25,680, 5.35 percent;

(2) On all over $25,680, but not over $102,030, 7.05 percent;

(3) On all over $102,030, 7.85 percent.

Married individuals filing separate returns, estates, and trusts must compute their
income tax by applying the above rates to their taxable income, except that the income
brackets will be one-half of the above amounts.

(b) The income taxes imposed by this chapter upon unmarried individuals must be
computed by applying to taxable net income the following schedule of rates:

(1) On the first $17,570, 5.35 percent;

(2) On all over $17,570, but not over $57,710, 7.05 percent;

(3) On all over $57,710, 7.85 percent.

(c) The income taxes imposed by this chapter upon unmarried individuals qualifying
as a head of household as defined in section 2(b) of the Internal Revenue Code must be
computed by applying to taxable net income the following schedule of rates:

(1) On the first $21,630, 5.35 percent;

(2) On all over $21,630, but not over $86,910, 7.05 percent;

(3) On all over $86,910, 7.85 percent.

(d) In lieu of a tax computed according to the rates set forth in this subdivision, the
tax of any individual taxpayer whose taxable net income for the taxable year is less than
an amount determined by the commissioner must be computed in accordance with tables
prepared and issued by the commissioner of revenue based on income brackets of not
more than $100. The amount of tax for each bracket shall be computed at the rates set
forth in this subdivision, provided that the commissioner may disregard a fractional part of
a dollar unless it amounts to 50 cents or more, in which case it may be increased to $1.

(e) An individual who is not a Minnesota resident for the entire year must compute
the individual's Minnesota income tax as provided in this subdivision. After the
application of the nonrefundable credits provided in this chapter, the tax liability must
then be multiplied by a fraction in which:

(1) the numerator is the individual's Minnesota source federal adjusted gross income
as defined in section 62 of the Internal Revenue Code and increased by the additions
required under section 290.01, subdivision 19a, clauses (1), (5), (6), (7), (8), (9), (12),
(13), and (16) to (18), and reduced by the Minnesota assignable portion of the subtraction
for United States government interest under section 290.01, subdivision 19b, clause (1),
and the subtractions under section 290.01, subdivision 19b, clauses (8), (9), (13), (14),
deleted text begin (15), (17),deleted text end new text begin (16),new text end and deleted text begin (18)deleted text end new text begin (17)new text end , after applying the allocation and assignability provisions of
section 290.081, clause (a), or 290.17; and

(2) the denominator is the individual's federal adjusted gross income as defined in
section 62 of the Internal Revenue Code of 1986, increased by the amounts specified in
section 290.01, subdivision 19a, clauses (1), (5), (6), (7), (8), (9), (12), (13), and (16) to
(18), and reduced by the amounts specified in section 290.01, subdivision 19b, clauses (1),
(8), (9), (13), (14), deleted text begin (15), (17)deleted text end new text begin (16)new text end , and deleted text begin (18)deleted text end new text begin (17)new text end .

Sec. 12.

Minnesota Statutes 2010, section 290.067, subdivision 1, is amended to read:


Subdivision 1.

Amount of credit.

(a) A taxpayer may take as a credit against the
tax due from the taxpayer and a spouse, if any, under this chapter an amount equal to the
dependent care credit for which the taxpayer is eligible pursuant to the provisions of
section 21 of the Internal Revenue Code subject to the limitations provided in subdivision
2 except that in determining whether the child qualified as a dependent, income received
as a Minnesota family investment program grant or allowance to or on behalf of the child
must not be taken into account in determining whether the child received more than half
of the child's support from the taxpayer, and the provisions of section 32(b)(1)(D) of
the Internal Revenue Code do not apply.

(b) If a child who has not attained the age of six years at the close of the taxable year
is cared for at a licensed family day care home operated by the child's parent, the taxpayer
is deemed to have paid employment-related expenses. If the child is 16 months old or
younger at the close of the taxable year, the amount of expenses deemed to have been paid
equals the maximum limit for one qualified individual under section 21(c) and (d) of the
Internal Revenue Code. If the child is older than 16 months of age but has not attained the
age of six years at the close of the taxable year, the amount of expenses deemed to have
been paid equals the amount the licensee would charge for the care of a child of the same
age for the same number of hours of care.

(c) If a married couple:

(1) has a child who has not attained the age of one year at the close of the taxable
year;

(2) files a joint tax return for the taxable year; and

(3) does not participate in a dependent care assistance program as defined in section
129 of the Internal Revenue Code, in lieu of the actual employment related expenses paid
for that child under paragraph (a) or the deemed amount under paragraph (b), the lesser of
(i) the combined earned income of the couple or (ii) the amount of the maximum limit for
one qualified individual under section 21(c) and (d) of the Internal Revenue Code will
be deemed to be the employment related expense paid for that child. The earned income
limitation of section 21(d) of the Internal Revenue Code shall not apply to this deemed
amount. These deemed amounts apply regardless of whether any employment-related
expenses have been paid.

(d) If the taxpayer is not required and does not file a federal individual income tax
return for the tax year, no credit is allowed for any amount paid to any person unless:

(1) the name, address, and taxpayer identification number of the person are included
on the return claiming the credit; or

(2) if the person is an organization described in section 501(c)(3) of the Internal
Revenue Code and exempt from tax under section 501(a) of the Internal Revenue Code,
the name and address of the person are included on the return claiming the credit.

In the case of a failure to provide the information required under the preceding sentence,
the preceding sentence does not apply if it is shown that the taxpayer exercised due
diligence in attempting to provide the information required.

In the case of a nonresident, part-year resident, or a person who has earned income
not subject to tax under this chapter including earned income excluded pursuant to section
290.01, subdivision 19b, clause (9) deleted text begin or (15)deleted text end , the credit determined under section 21 of the
Internal Revenue Code must be allocated based on the ratio by which the earned income
of the claimant and the claimant's spouse from Minnesota sources bears to the total earned
income of the claimant and the claimant's spouse.

For residents of Minnesota, the subtractions for military pay under section 290.01,
subdivision 19b
, clauses (10) and (11), are not considered "earned income not subject to
tax under this chapter."

For residents of Minnesota, the exclusion of combat pay under section 112 of the
Internal Revenue Code is not considered "earned income not subject to tax under this
chapter."

Sec. 13.

Minnesota Statutes 2011 Supplement, section 290.0671, subdivision 1,
is amended to read:


Subdivision 1.

Credit allowed.

(a) An individual is allowed a credit against the tax
imposed by this chapter equal to a percentage of earned income. To receive a credit, a
taxpayer must be eligible for a credit under section 32 of the Internal Revenue Code.

(b) For individuals with no qualifying children, the credit equals 1.9125 percent of
the first $4,620 of earned income. The credit is reduced by 1.9125 percent of earned
income or adjusted gross income, whichever is greater, in excess of $5,770, but in no
case is the credit less than zero.

(c) For individuals with one qualifying child, the credit equals 8.5 percent of the first
$6,920 of earned income and 8.5 percent of earned income over $12,080 but less than
$13,450. The credit is reduced by 5.73 percent of earned income or adjusted gross income,
whichever is greater, in excess of $15,080, but in no case is the credit less than zero.

(d) For individuals with two or more qualifying children, the credit equals ten
percent of the first $9,720 of earned income and 20 percent of earned income over
$14,860 but less than $16,800. The credit is reduced by 10.3 percent of earned income
or adjusted gross income, whichever is greater, in excess of $17,890, but in no case is
the credit less than zero.

(e) For a nonresident or part-year resident, the credit must be allocated based on the
percentage calculated under section 290.06, subdivision 2c, paragraph (e).

(f) For a person who was a resident for the entire tax year and has earned income
not subject to tax under this chapter, including income excluded under section 290.01,
subdivision 19b
, clause (9) deleted text begin or (15)deleted text end , the credit must be allocated based on the ratio of
federal adjusted gross income reduced by the earned income not subject to tax under
this chapter over federal adjusted gross income. For purposes of this paragraph, the
subtractions for military pay under section 290.01, subdivision 19b, clauses (10) and (11),
are not considered "earned income not subject to tax under this chapter."

For the purposes of this paragraph, the exclusion of combat pay under section 112
of the Internal Revenue Code is not considered "earned income not subject to tax under
this chapter."

(g) For tax years beginning after December 31, 2007, and before December 31,
2010, the $5,770 in paragraph (b), the $15,080 in paragraph (c), and the $17,890 in
paragraph (d), after being adjusted for inflation under subdivision 7, are each increased by
$3,000 for married taxpayers filing joint returns. For tax years beginning after December
31, 2008, the commissioner shall annually adjust the $3,000 by the percentage determined
pursuant to the provisions of section 1(f) of the Internal Revenue Code, except that in
section 1(f)(3)(B), the word "2007" shall be substituted for the word "1992." For 2009,
the commissioner shall then determine the percent change from the 12 months ending on
August 31, 2007, to the 12 months ending on August 31, 2008, and in each subsequent
year, from the 12 months ending on August 31, 2007, to the 12 months ending on August
31 of the year preceding the taxable year. The earned income thresholds as adjusted
for inflation must be rounded to the nearest $10. If the amount ends in $5, the amount
is rounded up to the nearest $10. The determination of the commissioner under this
subdivision is not a rule under the Administrative Procedure Act.

(h) For tax years beginning after December 31, 2010, and before January 1, 2012,
the $5,770 in paragraph (b), the $15,080 in paragraph (c), and the $17,890 in paragraph
(d), after being adjusted for inflation under subdivision 7, are each increased by $5,000
for married taxpayers filing joint returns. For tax years beginning after December 31,
2010, and before January 1, 2012, the commissioner shall annually adjust the $5,000
by the percentage determined pursuant to the provisions of section 1(f) of the Internal
Revenue Code, except that in section 1(f)(3)(B), the word "2008" shall be substituted for
the word "1992." For 2011, the commissioner shall then determine the percent change
from the 12 months ending on August 31, 2008, to the 12 months ending on August
31, 2010. The earned income thresholds as adjusted for inflation must be rounded to
the nearest $10. If the amount ends in $5, the amount is rounded up to the nearest $10.
The determination of the commissioner under this subdivision is not a rule under the
Administrative Procedure Act.

(i) The commissioner shall construct tables showing the amount of the credit at
various income levels and make them available to taxpayers. The tables shall follow
the schedule contained in this subdivision, except that the commissioner may graduate
the transition between income brackets.

Sec. 14.

Minnesota Statutes 2011 Supplement, section 290.091, subdivision 2, is
amended to read:


Subd. 2.

Definitions.

For purposes of the tax imposed by this section, the following
terms have the meanings given:

(a) "Alternative minimum taxable income" means the sum of the following for
the taxable year:

(1) the taxpayer's federal alternative minimum taxable income as defined in section
55(b)(2) of the Internal Revenue Code;

(2) the taxpayer's itemized deductions allowed in computing federal alternative
minimum taxable income, but excluding:

(i) the charitable contribution deduction under section 170 of the Internal Revenue
Code;

(ii) the medical expense deduction;

(iii) the casualty, theft, and disaster loss deduction; and

(iv) the impairment-related work expenses of a disabled person;

(3) for depletion allowances computed under section 613A(c) of the Internal
Revenue Code, with respect to each property (as defined in section 614 of the Internal
Revenue Code), to the extent not included in federal alternative minimum taxable income,
the excess of the deduction for depletion allowable under section 611 of the Internal
Revenue Code for the taxable year over the adjusted basis of the property at the end of the
taxable year (determined without regard to the depletion deduction for the taxable year);

(4) to the extent not included in federal alternative minimum taxable income, the
amount of the tax preference for intangible drilling cost under section 57(a)(2) of the
Internal Revenue Code determined without regard to subparagraph (E);

(5) to the extent not included in federal alternative minimum taxable income, the
amount of interest income as provided by section 290.01, subdivision 19a, clause (1); and

(6) the amount of addition required by section 290.01, subdivision 19a, clauses (7)
to (9), (12), (13), and (16) to (18);

less the sum of the amounts determined under the following:

(1) interest income as defined in section 290.01, subdivision 19b, clause (1);

(2) an overpayment of state income tax as provided by section 290.01, subdivision
19b
, clause (2), to the extent included in federal alternative minimum taxable income;

(3) the amount of investment interest paid or accrued within the taxable year on
indebtedness to the extent that the amount does not exceed net investment income, as
defined in section 163(d)(4) of the Internal Revenue Code. Interest does not include
amounts deducted in computing federal adjusted gross income;

(4) amounts subtracted from federal taxable income as provided by section 290.01,
subdivision 19b
, clauses (6), (8) to deleted text begin (15)deleted text end new text begin (14)new text end , and deleted text begin (17)deleted text end new text begin (16)new text end ; and

(5) the amount of the net operating loss allowed under section 290.095, subdivision
11, paragraph (c).

In the case of an estate or trust, alternative minimum taxable income must be
computed as provided in section 59(c) of the Internal Revenue Code.

(b) "Investment interest" means investment interest as defined in section 163(d)(3)
of the Internal Revenue Code.

(c) "Net minimum tax" means the minimum tax imposed by this section.

(d) "Regular tax" means the tax that would be imposed under this chapter (without
regard to this section and section 290.032), reduced by the sum of the nonrefundable
credits allowed under this chapter.

(e) "Tentative minimum tax" equals 6.4 percent of alternative minimum taxable
income after subtracting the exemption amount determined under subdivision 3.

Sec. 15.

Minnesota Statutes 2010, section 290.0921, subdivision 3, is amended to read:


Subd. 3.

Alternative minimum taxable income.

"Alternative minimum taxable
income" is Minnesota net income as defined in section 290.01, subdivision 19, and
includes the adjustments and tax preference items in sections 56, 57, 58, and 59(d), (e),
(f), and (h) of the Internal Revenue Code. If a corporation files a separate company
Minnesota tax return, the minimum tax must be computed on a separate company basis.
If a corporation is part of a tax group filing a unitary return, the minimum tax must be
computed on a unitary basis. The following adjustments must be made.

(1) For purposes of the depreciation adjustments under section 56(a)(1) and
56(g)(4)(A) of the Internal Revenue Code, the basis for depreciable property placed in
service in a taxable year beginning before January 1, 1990, is the adjusted basis for federal
income tax purposes, including any modification made in a taxable year under section
290.01, subdivision 19e, or Minnesota Statutes 1986, section 290.09, subdivision 7,
paragraph (c).

For taxable years beginning after December 31, 2000, the amount of any remaining
modification made under section 290.01, subdivision 19e, or Minnesota Statutes 1986,
section 290.09, subdivision 7, paragraph (c), not previously deducted is a depreciation
allowance in the first taxable year after December 31, 2000.

(2) The portion of the depreciation deduction allowed for federal income tax
purposes under section 168(k) of the Internal Revenue Code that is required as an
addition under section 290.01, subdivision 19c, clause (15), is disallowed in determining
alternative minimum taxable income.

(3) The subtraction for depreciation allowed under section 290.01, subdivision 19d,
clause (17), is allowed as a depreciation deduction in determining alternative minimum
taxable income.

(4) The alternative tax net operating loss deduction under sections 56(a)(4) and 56(d)
of the Internal Revenue Code does not apply.

(5) The special rule for certain dividends under section 56(g)(4)(C)(ii) of the Internal
Revenue Code does not apply.

(6) The special rule for dividends from section 936 companies under section
56(g)(4)(C)(iii) does not apply.

(7) The tax preference for depletion under section 57(a)(1) of the Internal Revenue
Code does not apply.

(8) The tax preference for intangible drilling costs under section 57(a)(2) of the
Internal Revenue Code must be calculated without regard to subparagraph (E) and the
subtraction under section 290.01, subdivision 19d, clause (4).

(9) The tax preference for tax exempt interest under section 57(a)(5) of the Internal
Revenue Code does not apply.

(10) The tax preference for charitable contributions of appreciated property under
section 57(a)(6) of the Internal Revenue Code does not apply.

(11) For purposes of calculating the tax preference for accelerated depreciation or
amortization on certain property placed in service before January 1, 1987, under section
57(a)(7) of the Internal Revenue Code, the deduction allowable for the taxable year is the
deduction allowed under section 290.01, subdivision 19e.

For taxable years beginning after December 31, 2000, the amount of any remaining
modification made under section 290.01, subdivision 19e, not previously deducted is a
depreciation or amortization allowance in the first taxable year after December 31, 2004.

(12) For purposes of calculating the adjustment for adjusted current earnings in
section 56(g) of the Internal Revenue Code, the term "alternative minimum taxable
income" as it is used in section 56(g) of the Internal Revenue Code, means alternative
minimum taxable income as defined in this subdivision, determined without regard to the
adjustment for adjusted current earnings in section 56(g) of the Internal Revenue Code.

(13) For purposes of determining the amount of adjusted current earnings under
section 56(g)(3) of the Internal Revenue Code, no adjustment shall be made under section
56(g)(4) of the Internal Revenue Code with respect to (i) the amount of foreign dividend
gross-up subtracted as provided in section 290.01, subdivision 19d, clause (1), (ii) the
amount of refunds of income, excise, or franchise taxes subtracted as provided in section
290.01, subdivision 19d, clause (9), or (iii) the amount of royalties, fees or other like
income subtracted as provided in section 290.01, subdivision 19d, clause (10).

(14) Alternative minimum taxable income excludes the income from operating in a
job opportunity building zone as provided under section 469.317.

(15) Alternative minimum taxable income excludes the income from operating in a
biotechnology and health sciences industry zone as provided under section 469.337.

deleted text begin (16) Alternative minimum taxable income excludes the income from operating in an
international economic development zone as provided under section 469.326.
deleted text end

Items of tax preference must not be reduced below zero as a result of the
modifications in this subdivision.

Sec. 16.

Minnesota Statutes 2011 Supplement, section 290.0922, subdivision 2,
is amended to read:


Subd. 2.

Exemptions.

The following entities are exempt from the tax imposed
by this section:

(1) corporations exempt from tax under section 290.05;

(2) real estate investment trusts;

(3) regulated investment companies or a fund thereof; and

(4) entities having a valid election in effect under section 860D(b) of the Internal
Revenue Code;

(5) town and farmers' mutual insurance companies;

(6) cooperatives organized under chapter 308A or 308B that provide housing
exclusively to persons age 55 and over and are classified as homesteads under section
273.124, subdivision 3;new text begin and
new text end

(7) a qualified business as defined under section 469.310, subdivision 11, if for the
taxable year all of its property is located in a job opportunity building zone designated
under section 469.314 and all of its payroll is a job opportunity building zone payroll
under section 469.310deleted text begin ; anddeleted text end new text begin .
new text end

deleted text begin (8) an entity, if for the taxable year all of its property is located in an international
economic development zone designated under section 469.322, and all of its payroll is
international economic development zone payroll under section 469.321. The exemption
under this clause applies to taxable years beginning during the duration of the international
economic development zone.
deleted text end

Entities not specifically exempted by this subdivision are subject to tax under this
section, notwithstanding section 290.05.

Sec. 17.

Minnesota Statutes 2011 Supplement, section 290.0922, subdivision 3,
is amended to read:


Subd. 3.

Definitions.

(a) "Minnesota sales or receipts" means the total sales
apportioned to Minnesota pursuant to section 290.191, subdivision 5, the total receipts
attributed to Minnesota pursuant to section 290.191, subdivisions 6 to 8, and/or the
total sales or receipts apportioned or attributed to Minnesota pursuant to any other
apportionment formula applicable to the taxpayer.

(b) "Minnesota property" means total Minnesota tangible property as provided in
section 290.191, subdivisions 9 to 11, any other tangible property located in Minnesota,
but does not include: (1) the property of a qualified business as defined under section
469.310, subdivision 11, that is located in a job opportunity building zone designated under
section 469.314deleted text begin ,deleted text end new text begin and new text end (2) property of a qualified business located in a biotechnology and
health sciences industry zone designated under section 469.334deleted text begin , or (3) for taxable years
beginning during the duration of the zone, property of a qualified business located in the
international economic development zone designated under section 469.322
deleted text end . Intangible
property shall not be included in Minnesota property for purposes of this section.
Taxpayers who do not utilize tangible property to apportion income shall nevertheless
include Minnesota property for purposes of this section. On a return for a short taxable
year, the amount of Minnesota property owned, as determined under section 290.191,
shall be included in Minnesota property based on a fraction in which the numerator is the
number of days in the short taxable year and the denominator is 365.

(c) "Minnesota payrolls" means total Minnesota payrolls as provided in section
290.191, subdivision 12, but does not include: (1) the job opportunity building zone
payroll under section 469.310, subdivision 8, of a qualified business as defined under
section 469.310, subdivision 11, new text begin and new text end (2) biotechnology and health sciences industry zone
payrolls under section 469.330, subdivision 8deleted text begin , or (3) for taxable years beginning during
the duration of the zone, international economic development zone payrolls under section
469.321, subdivision 9
deleted text end . Taxpayers who do not utilize payrolls to apportion income shall
nevertheless include Minnesota payrolls for purposes of this section.

Sec. 18.

Minnesota Statutes 2011 Supplement, section 297A.75, subdivision 1, is
amended to read:


Subdivision 1.

Tax collected.

The tax on the gross receipts from the sale of the
following exempt items must be imposed and collected as if the sale were taxable and the
rate under section 297A.62, subdivision 1, applied. The exempt items include:

(1) capital equipment exempt under section 297A.68, subdivision 5;

(2) building materials for an agricultural processing facility exempt under section
297A.71, subdivision 13;

(3) building materials for mineral production facilities exempt under section
297A.71, subdivision 14;

(4) building materials for correctional facilities under section 297A.71, subdivision
3
;

(5) building materials used in a residence for disabled veterans exempt under section
297A.71, subdivision 11;

(6) elevators and building materials exempt under section 297A.71, subdivision 12;

(7) building materials for the Long Lake Conservation Center exempt under section
297A.71, subdivision 17;

(8) materials and supplies for qualified low-income housing under section 297A.71,
subdivision 23
;

(9) materials, supplies, and equipment for municipal electric utility facilities under
section 297A.71, subdivision 35;

(10) equipment and materials used for the generation, transmission, and distribution
of electrical energy and an aerial camera package exempt under section 297A.68,
subdivision 37;

(11) deleted text begin tangible personal property and taxable services and construction materials,
supplies, and equipment exempt under section 297A.68, subdivision 41;
deleted text end

deleted text begin (12)deleted text end commuter rail vehicle and repair parts under section 297A.70, subdivision
3, clause (11);

deleted text begin (13)deleted text end new text begin (12)new text end materials, supplies, and equipment for construction or improvement of
projects and facilities under section 297A.71, subdivision 40;

deleted text begin (14)deleted text end new text begin (13)new text end materials, supplies, and equipment for construction or improvement of a
meat processing facility exempt under section 297A.71, subdivision 41;

deleted text begin (15)deleted text end new text begin (14)new text end materials, supplies, and equipment for construction, improvement, or
expansion of an aerospace defense manufacturing facility exempt under section 297A.71,
subdivision 42; and

deleted text begin (16)deleted text end new text begin (15)new text end enterprise information technology equipment and computer software for
use in a qualified data center exempt under section 297A.68, subdivision 42.

Sec. 19.

Minnesota Statutes 2010, section 469.015, subdivision 4, is amended to read:


Subd. 4.

Exceptions.

(a) An authority need not require competitive bidding in the
following circumstances:

(1) in the case of a contract for the acquisition of a low-rent housing project:

(i) for which financial assistance is provided by the federal government;

(ii) which does not require any direct loan or grant of money from the municipality
as a condition of the federal financial assistance; and

(iii) for which the contract provides for the construction of the project upon land that
is either owned by the authority for redevelopment purposes or not owned by the authority
at the time of the contract but the contract provides for the conveyance or lease to the
authority of the project or improvements upon completion of construction;

(2) with respect to a structured parking facility:

(i) constructed in conjunction with, and directly above or below, a development; and

(ii) financed with the proceeds of tax increment or parking ramp general obligation
or revenue bonds;new text begin and
new text end

(3) deleted text begin until August 1, 2009, with respect to a facility built for the purpose of facilitating
the operation of public transit or encouraging its use:
deleted text end

deleted text begin (i) constructed in conjunction with, and directly above or below, a development; and
deleted text end

deleted text begin (ii) financed with the proceeds of parking ramp general obligation or revenue bonds
or with at least 60 percent of the construction cost being financed with funding provided
by the federal government; and
deleted text end

deleted text begin (4)deleted text end in the case of any building in which at least 75 percent of the usable square
footage constitutes a housing development project if:

(i) the project is financed with the proceeds of bonds issued under section 469.034 or
from nongovernmental sources;

(ii) the project is either located on land that is owned or is being acquired by the
authority only for development purposes, or is not owned by the authority at the time the
contract is entered into but the contract provides for conveyance or lease to the authority
of the project or improvements upon completion of construction; and

(iii) the authority finds and determines that elimination of the public bidding
requirements is necessary in order for the housing development project to be economical
and feasible.

(b) An authority need not require a performance bond for the following projects:

(1) a contract described in paragraph (a), clause (1);

(2) a construction change order for a housing project in which 30 percent of the
construction has been completed;

(3) a construction contract for a single-family housing project in which the authority
acts as the general construction contractor; or

(4) a services or materials contract for a housing project.

For purposes of this paragraph, "services or materials contract" does not include
construction contracts.

Sec. 20.

Minnesota Statutes 2010, section 469.033, subdivision 7, is amended to read:


Subd. 7.

Inactive authorities; transfer of funds; dissolution.

The authority may
transfer to the city in and for which it was created all property, assets, cash or other
funds held or used by the authority deleted text begin which were derived from the special benefit tax
for redevelopment levied pursuant to subdivision 6 prior to March 6, 1953, whenever
collected
deleted text end . Upon any such transfer, an authority shall not thereafter levy the tax or exercise
the redevelopment powers of sections 469.001 to 469.047. All cash or other funds
transferred to the city shall be used exclusively for permanent improvements in the city
or the retirement of debts or bonds incurred for permanent improvements in the city.
An authority which transfers its property, assets, cash, or other funds deleted text begin derived from the
special benefit tax for redevelopment and which has not entered into a contract with
the federal government with respect to any low-rent public housing project prior to
March 6, 1953,
deleted text end shall be dissolved as deleted text begin hereindeleted text end providednew text begin in this subdivisionnew text end . After a public
hearing after ten days' published notice thereof in a newspaper of general circulation in
the city, the governing body of a city in and for which an authority has been created
may dissolve the authority if the authority has not entered into any contract with the
federal government or any agency or instrumentality thereof for a loan or a grant with
respect to any urban redevelopment or low-rent public housing projectnew text begin that remains in
effect
new text end . The resolution or ordinance dissolving the authority shall be published in the
same manner in which ordinances are published in the city and the authority shall be
dissolved when the resolution or ordinance becomes finally effective. The clerk of the
governing body of the municipality shall furnish to the commissioner of employment and
economic development a certified copy of the resolution or ordinance of the governing
body dissolving the authority. All property, records, assets, cash, or other funds held or
used by an authority shall be transferred to and become the property of the municipality
and cash or other funds shall be used as herein provided. Upon dissolution of an authority,
all rights of an authority against any person, firm, or corporation shall accrue to and
be enforced by the municipality.

Sec. 21.

Minnesota Statutes 2010, section 469.166, subdivision 3, is amended to read:


Subd. 3.

new text begin Border city new text end enterprise zone.

"new text begin Border city new text end enterprise zone" means an area
in the state designated as deleted text begin suchdeleted text end new text begin an enterprise zonenew text end by the commissionernew text begin in the cities of
Breckenridge, Dilworth, East Grand Forks, Moorhead, or Ortonville
new text end .

Sec. 22.

Minnesota Statutes 2010, section 469.166, subdivision 5, is amended to read:


Subd. 5.

Municipality.

"Municipality" means a citydeleted text begin , or a county for an area located
outside the boundaries of a city. If an area lies in two or more cities or in both incorporated
and unincorporated areas, "municipality" shall include an entity formed pursuant to
section 471.59 by the governing bodies of the cities with jurisdiction over the incorporated
area and the counties with jurisdiction over the unincorporated area
deleted text end .

Sec. 23.

Minnesota Statutes 2010, section 469.166, subdivision 6, is amended to read:


Subd. 6.

Governing body.

"Governing body" means deleted text begin the county board in the case
of a county,
deleted text end the city council or other body designated by deleted text begin itsdeleted text end new text begin thenew text end charter deleted text begin in the case of adeleted text end new text begin
of the
new text end citydeleted text begin , or the tribal or federal agency recognized as the governing body of an Indian
reservation by the United States Secretary of the Interior
deleted text end .

Sec. 24.

Minnesota Statutes 2010, section 469.167, subdivision 2, is amended to read:


Subd. 2.

Duration.

The designation of deleted text begin an area as andeleted text end new text begin a border citynew text end enterprise zone
deleted text begin shall be effective for seven years after the date of designation, except that enterprise zones
in border cities eligible to receive allocations for tax reductions under section 469.169,
subdivisions 7 and 8
, and under section 469.171, subdivision 6a or 6b, shall be
deleted text end new text begin isnew text end effective
until terminated by resolution adopted by the city in which the border city enterprise
zone is located.

Sec. 25.

Minnesota Statutes 2010, section 469.171, subdivision 1, is amended to read:


Subdivision 1.

Authorized types.

new text begin (a) new text end The following types of tax reductions may
be approved by the commissioner for businesses located in deleted text begin andeleted text end new text begin a border citynew text end enterprise
zonenew text begin , after the governing body of the border city has designated an area or areas, each
consisting of at least 100 acres, of the city not in excess of a total of 400 acres in which the
tax reductions may be provided
new text end :

(1) an exemption from the general sales tax imposed by chapter 297A for purchases
of construction materials or equipment for use in the zone if the purchase was made
after the date of application for the zone;

(2) a credit against the income tax of an employer for additional workers employed
in the zone, other than workers employed in construction, up to a maximum of $3,000
per employee per year;

(3) an income tax credit for a percentage of the cost of debt financing to construct
new or expanded facilities in the zone; and

(4) a state paid property tax credit for a portion of the property taxes paid by a new
commercial or industrial facility or the additional property taxes paid by an expansion of
an existing commercial or industrial facility in the zone.

new text begin (b) An application for a tax reduction under this subdivision may not be approved
unless the governing body finds that the construction or improvement of the facility is
not likely to have the effect of transferring existing employment from a location outside
of the municipality but within the state.
new text end

Sec. 26.

Minnesota Statutes 2010, section 469.171, subdivision 4, is amended to read:


Subd. 4.

Restriction.

The tax reductions provided by this section shall not
apply to (1) a facility the primary purpose of which is one of the following: retail food
and beverage services, automobile sales or service, or the provision of recreation or
entertainment, or a private or commercial golf course, country club, massage parlor, tennis
club, skating facility including roller skating, skateboard, and ice skating, racquet sports
facility, including any handball or racquetball court, hot tub facility, suntan facility, or
racetrack; (2) property of a public utility; (3) property used in the operation of a financial
institution; (4) property owned by a fraternal or veterans' organization; or (5) property of a
business operating under a franchise agreement that requires the business to be located in
the state; except thatdeleted text begin , in an enterprise zone designated under section 469.168, subdivision
4, paragraph (c)
, that is not in a city of the first class,
deleted text end tax reductions may be provided to
a retail food or beverage facility or an automobile sales or service facility, or a business
operating under a franchise agreement that requires the business to be located in this state
except for such a franchised retail food or beverage facility.

Sec. 27.

Minnesota Statutes 2010, section 469.171, subdivision 6a, is amended to read:


Subd. 6a.

Additional border city allocations.

deleted text begin In addition to tax reductions
authorized in section 469.169, subdivisions 7 and 8,
deleted text end The commissioner may allocate
$2,000,000 for tax reductions pursuant to subdivision 9 to new text begin border city new text end enterprise zones
deleted text begin designated under section 469.168, subdivision 4, paragraph (c), except for zones located
in cities of the first class
deleted text end . This money shall be allocated among the zones on a per
capita basis. deleted text begin Limits on the maximum allocation to a zone imposed by section 469.169,
subdivision 7
, do not apply to allocations made under this subdivision.
deleted text end Tax reductions
authorized by this subdivision may not be allocated to any property which is:

(1) a facility the primary purpose of which is one of the following: the provision
of recreation or entertainment, or a private or commercial golf course, country club,
massage parlor, tennis club, skating facility including roller skating, skateboard, and
ice skating, racquet sports facility, including any handball or racquetball court, hot tub
facility, suntan facility, or racetrack;

(2) property of a public utility;

(3) property used in the operation of a financial institution;

(4) property owned by a fraternal or veterans' organization;

(5) property of a retail food or beverage service business operating under a franchise
agreement that requires the business to be located in the state.

Sec. 28.

Minnesota Statutes 2010, section 469.171, subdivision 7, is amended to read:


Subd. 7.

Duration.

deleted text begin Each tax reduction provided to a business pursuant to this
subdivision shall terminate not longer than five years after the effective date of the tax
reduction for the business unless the business is located in a border city enterprise zone
designated under section 469.168, subdivision 4, paragraph (c), that is not a city of the
first class.
deleted text end Each tax reduction provided to a business that is located in a border city
enterprise zone deleted text begin designated under section 469.168, subdivision 4, paragraph (c), that is not
located in a city of the first class,
deleted text end may be provided until the allocations provided under
subdivision 6a, and under section 469.169, deleted text begin subdivisions 7 and 8deleted text end deleted text begin ,deleted text end have been expended.
Subject to the limitation in this subdivision, the tax reductions may be provided after
expiration of the zone's designation.

Sec. 29.

Minnesota Statutes 2010, section 469.171, subdivision 9, is amended to read:


Subd. 9.

Recapture.

Any business that (1) receives tax reductions authorized by
subdivisions 1 to 8deleted text begin , classification as employment property pursuant to section 469.170, or
an alternative local contribution under section 469.169, subdivision 5
deleted text end ; and (2) ceases to
operate its facility located within the new text begin border city new text end enterprise zone shall repay the amount of
the tax reduction or local contribution received during the two years immediately before
it ceased to operate in the zone.

The repayment must be paid to the state to the extent it represents a tax reduction
under subdivisions 1 to 8 and to the municipality to the extent it represents a property tax
reduction or other local contribution. Any amount repaid to the state must be credited
to the amount certified as available for tax reductions in the zone pursuant to deleted text begin section
469.169, subdivision 7
deleted text end new text begin the city's allocationnew text end . Any amount repaid to the municipality must
be used by the municipality for economic development purposes. The commissioner of
revenue may seek repayment of tax credits from a business ceasing to operate within an
enterprise zone by utilizing any remedies available for the collection of tax.

Sec. 30.

Minnesota Statutes 2010, section 469.171, subdivision 11, is amended to read:


Subd. 11.

Limitations; last eight months of duration.

This subdivision applies
only to state tax reductions first authorized by the municipality to be provided to a business
within eight months of the expiration of the new text begin border city new text end enterprise zone's designation.

Before agreeing with a business to provide tax reductions, the municipality must
submit the proposed tax reductions to the commissioner for approval. The commissioner
shall review and analyze the proposal in light of, at least: (1) the proposed investment that
the business will make in the zone, (2) the number and quality of new jobs that will be
created in the zone, (3) the overall positive impact on economic activity in the zone, and
(4) the extent to which the impacts in clauses (1) to (3) are dependent upon providing the
state tax reductions to the business. The commissioner shall disapprove the proposal if the
commissioner determines the public benefits of increased investment and employment
resulting from the tax reductions is disproportionately small relative to the cost of the
state tax reductions. If the commissioner disapproves of the proposal, the tax reductions
are not allowed to the business.

If the municipality submits the proposal to the commissioner before expiration
of the zone designation, the authority to grant the tax reductions continues until the
commissioner acts on the proposal.

Sec. 31.

Minnesota Statutes 2010, section 469.172, is amended to read:


469.172 DEVELOPMENT AND REDEVELOPMENT POWERS.

Notwithstanding any contrary provision of law or charter, any city deleted text begin of the first or
second class
deleted text end that contains deleted text begin andeleted text end new text begin a border citynew text end enterprise zone deleted text begin or that has been designated as
an enterprise zone
deleted text end may, in addition to its other powers, exercise the powers granted to
a governmental subdivision by sections 469.001 to 469.047, 469.048 to 469.068, and
469.109 to 469.113. Section 469.059, subdivision 15, deleted text begin shall applydeleted text end new text begin appliesnew text end to the city in
the exercise of the powers granted pursuant to this section. It may exercise the powers
assigned to redevelopment agencies pursuant to sections 469.152 to 469.165, without
limitation to further the purposes of sections 469.001 to 469.047, 469.048 to 469.068, and
469.109 to 469.134. It may exercise the powers set forth in sections 469.001 to 469.047,
469.048 to 469.068, and 469.109 to 469.164 without limitation to further the purposes
and policies set forth in sections 469.152 to 469.165. It may exercise the powers granted
by this subdivision and any other development or redevelopment powers authorized by
other laws, including sections 469.124 to 469.134 and 469.152 to 469.165, independently
or in conjunction with each other as though all the powers had been granted to a single
entity. Any project undertaken to accomplish the purposes of sections 469.001 to 469.047
that qualifies as single-family housing under section 462C.02, subdivision 4, deleted text begin shall bedeleted text end new text begin isnew text end
subject to the provisions of chapter 462C.

Upon expiration of the designation of the enterprise zone, the powers granted by
this subdivision may be exercised only with respect to any project, program, or activity
commenced or established prior to that date. The powers granted by this subdivision may
only be exercised within the zone.

Sec. 32.

Minnesota Statutes 2010, section 469.173, subdivision 5, is amended to read:


Subd. 5.

Information sharing.

Pursuant to section 270B.14, subdivision 3,
the commissioner of revenue may share information with the commissioner or with a
municipality receiving an enterprise zone designation, insofar as necessary to administer
the funding limitations provided by section 469.169deleted text begin , subdivision 7deleted text end .

Sec. 33.

Minnesota Statutes 2010, section 469.173, subdivision 6, is amended to read:


Subd. 6.

Zone boundary realignment.

The commissioner may approve specific
applications by a municipality to amend the boundaries of a new text begin border city enterprise new text end zone
deleted text begin or of an area or areas designated pursuant to section 469.171, subdivision 5,deleted text end at any time.
Boundaries of a zone may not be amended to create noncontiguous subdivisions. If the
commissioner approves the amended boundaries, the change is effective on the date of
approval. deleted text begin Notwithstanding the area limitation under section 469.168, subdivision 3, the
commissioner may approve a specific application to amend the boundaries of an enterprise
zone which is located within five municipalities and was designated in 1984, to increase
its area to not more than 800 acres, and may approve an additional specific application to
amend the boundaries of that enterprise zone to include a sixth municipality or to further
increase its area to include all or part of the territory of a town that surrounds one of
the five municipalities, or both.
deleted text end

deleted text begin Notwithstanding the area limitation under section 469.168, subdivision 3, the
commissioner may approve a specific application to amend the boundaries of an enterprise
zone that is located within four municipalities to include a fifth municipality. The addition
of the fifth municipality may only be approved after the existing municipalities, by
adoption of a resolution by each municipality's governing board, agree to the addition
of the fifth municipality.
deleted text end

Sec. 34.

Minnesota Statutes 2010, section 469.174, subdivision 20, is amended to read:


Subd. 20.

Internal Revenue Code.

"Internal Revenue Code" means the Internal
Revenue Code of 1986, as amended deleted text begin through December 31, 1993deleted text end .

Sec. 35.

Minnesota Statutes 2010, section 469.174, subdivision 25, is amended to read:


Subd. 25.

Increment.

"Increment," "tax increment," "tax increment revenues,"
"revenues derived from tax increment," and other similar terms for a district include:

(1) taxes paid by the captured net tax capacity, but excluding any excess taxes, as
computed under section 469.177;

(2) the proceeds from the sale or lease of property, tangible or intangible, to the
extent the property was purchased by the authority with tax increments;

(3) principal and interest received on loans or other advances made by the authority
with tax increments;

(4) interest or other investment earnings on or from tax increments;new text begin and
new text end

(5) repayments or return of tax increments made to the authority under agreements
for districts for which the request for certification was made after August 1, 1993deleted text begin ; and
deleted text end

deleted text begin (6) the market value homestead credit paid to the authority under section 273.1384deleted text end .

Sec. 36.

Minnesota Statutes 2010, section 469.176, subdivision 7, is amended to read:


Subd. 7.

Parcels not includable in districts.

(a) The authority may request
inclusion in a tax increment financing district and the county auditor may certify the
original tax capacity of a parcel or a part of a parcel that qualified under the provisions of
section 273.111 deleted text begin ordeleted text end new text begin ,new text end 273.112new text begin , 273.114,new text end or chapter 473H for taxes payable in any of the five
calendar years before the filing of the request for certification only for:

(1) a district in which 85 percent or more of the planned buildings and facilities
(determined on the basis of square footage) are a qualified manufacturing facility or a
qualified distribution facility or a combination of both; or

(2) a housing district.

(b)(1) A distribution facility means buildings and other improvements to real
property that are used to conduct activities in at least each of the following categories:

(i) to store or warehouse tangible personal property;

(ii) to take orders for shipment, mailing, or delivery;

(iii) to prepare personal property for shipment, mailing, or delivery; and

(iv) to ship, mail, or deliver property.

(2) A manufacturing facility includes space used for manufacturing or producing
tangible personal property, including processing resulting in the change in condition of the
property, and space necessary for and related to the manufacturing activities.

(3) To be a qualified facility, the owner or operator of a manufacturing or distribution
facility must agree to pay and pay 90 percent or more of the employees of the facility at
a rate equal to or greater than 160 percent of the federal minimum wage for individuals
over the age of 20.

Sec. 37.

Minnesota Statutes 2010, section 469.1763, subdivision 6, is amended to read:


Subd. 6.

Pooling permitted for deficits.

(a) This subdivision applies only to
districts for which the request for certification was made before August 1, 2001, and
without regard to whether the request for certification was made prior to August 1, 1979.

(b) The municipality for the district may transfer available increments from another
tax increment financing district located in the municipality, if the transfer is necessary to
eliminate a deficit in the district to which the increments are transferred. The municipality
may transfer increments as provided by this subdivision without regard to whether the
transfer or expenditure is authorized by the tax increment financing plan for the district
from which the transfer is made. A deficit in the district for purposes of this subdivision
means the lesser of the following two amounts:

(1)(i) the amount due during the calendar year to pay preexisting obligations of
the district; minus

(ii) the total increments collected or to be collected from properties located within
the district that are available for the calendar year including amounts collected in prior
years that are currently available; plus

(iii) total increments from properties located in other districts in the municipality
including amounts collected in prior years that are available to be used to meet the district's
obligations under this section, excluding this subdivision, or other provisions of law deleted text begin (but
excluding a special tax under section 469.1791 and the grant program under Laws 1997,
chapter 231, article 1, section 19, or Laws 2001, First Special Session chapter 5)
deleted text end ; or

(2) the reduction in increments collected from properties located in the district for
the calendar year as a result of the changes in class rates in Laws 1997, chapter 231, article
1; Laws 1998, chapter 389, article 2; and Laws 1999, chapter 243, and Laws 2001, First
Special Session chapter 5, or the elimination of the general education tax levy under
Laws 2001, First Special Session chapter 5.

The authority may compute the deficit amount under clause (1) only (without regard
to the limit under clause (2)) if the authority makes an irrevocable commitment, by
resolution, to use increments from the district to which increments are to be transferred and
any transferred increments are only used to pay preexisting obligations and administrative
expenses for the district that are required to be paid under section 469.176, subdivision
4h
, paragraph (a).

(c) A preexisting obligation means:

(1) bonds issued and sold before August 1, 2001, or bonds issued pursuant to a
binding contract requiring the issuance of bonds entered into before July 1, 2001, and
bonds issued to refund such bonds or to reimburse expenditures made in conjunction with
a signed contractual agreement entered into before August 1, 2001, to the extent that the
bonds are secured by a pledge of increments from the tax increment financing district; and

(2) binding contracts entered into before August 1, 2001, to the extent that the
contracts require payments secured by a pledge of increments from the tax increment
financing district.

(d) The municipality may require a development authority, other than a seaway port
authority, to transfer available increments including amounts collected in prior years that
are currently available for any of its tax increment financing districts in the municipality to
make up an insufficiency in another district in the municipality, regardless of whether the
district was established by the development authority or another development authority.
This authority applies notwithstanding any law to the contrary, but applies only to a
development authority that:

(1) was established by the municipality; or

(2) the governing body of which is appointed, in whole or part, by the municipality
or an officer of the municipality or which consists, in whole or part, of members of
the governing body of the municipality. The municipality may use this authority only
after it has first used all available increments of the receiving development authority to
eliminate the insufficiency and exercised any permitted action under section 469.1792,
subdivision 3
, for preexisting districts of the receiving development authority to eliminate
the insufficiency.

(e) The authority under this subdivision to spend tax increments outside of the area
of the district from which the tax increments were collected:

(1) is an exception to the restrictions under section 469.176, subdivisions 4b, 4c,
4d, 4e, 4i, and 4j
; the expenditure limits under section 469.176, subdivision 1c; and the
other provisions of this section; and the percentage restrictions under subdivision 2 must
be calculated after deducting increments spent under this subdivision from the total
increments for the district; and

(2) applies notwithstanding the provisions of the Tax Increment Financing Act in
effect for districts for which the request for certification was made before June 30, 1982,
or any other law to the contrary.

(f) If a preexisting obligation requires the development authority to pay an amount
that is limited to the increment from the district or a specific development within the
district and if the obligation requires paying a higher amount to the extent that increments
are available, the municipality may determine that the amount due under the preexisting
obligation equals the higher amount and may authorize the transfer of increments
under this subdivision to pay up to the higher amount. The existence of a guarantee of
obligations by the individual or entity that would receive the payment under this paragraph
is disregarded in the determination of eligibility to pool under this subdivision. The
authority to transfer increments under this paragraph may only be used to the extent
that the payment of all other preexisting obligations in the municipality due during the
calendar year have been satisfied.

(g) For transfers of increments made in calendar year 2005 and later, the reduction in
increments as a result of the elimination of the general education tax levy for purposes of
paragraph (b), clause (2), for a taxes payable year equals the general education tax rate
for the school district under Minnesota Statutes 2000, section 273.1382, subdivision 1,
for taxes payable in 2001, multiplied by the captured tax capacity of the district for the
current taxes payable year.

Sec. 38.

Minnesota Statutes 2010, section 469.1764, subdivision 1, is amended to read:


Subdivision 1.

Scope; application.

(a) This section applies to a tax increment
financing district or area added to a district, if the request for certification of the district or
the area added to the district was made after July 31, 1979, and before July 1, 1982.

(b) This section, section 469.1763, subdivision 6, and any special law applying to
the district are the exclusive authority to spend tax increments on activities located outside
of the geographic area of a tax increment financing district that is subject to this section.

(c) This section does not apply to increments from a district that is subject to the
provisions of this section, if:

(1) the district was decertified before the enactment of this section and all increments
spent on activities located outside of the geographic area of the district were repaid and
distributed as excess increments under section 469.176, subdivision 2; or

(2) the use of increments on activities located outside of the geographic area of
the district consists solely of payment of debt service on bonds under section 469.129,
subdivision 2
new text begin , before its repealnew text end , and any bonds issued to refund bonds issued under that
subdivision.

Sec. 39.

Minnesota Statutes 2010, section 469.177, subdivision 1, is amended to read:


Subdivision 1.

Original net tax capacity.

(a) Upon or after adoption of a tax
increment financing plan, the auditor of any county in which the district is situated shall,
upon request of the authority, certify the original net tax capacity of the tax increment
financing district and that portion of the district overlying any subdistrict as described in
the tax increment financing plan and shall certify in each year thereafter the amount by
which the original net tax capacity has increased or decreased as a result of a change in tax
exempt status of property within the district and any subdistrict, reduction or enlargement
of the district or changes pursuant to subdivision 4. The auditor shall certify the amount
within 30 days after receipt of the request and sufficient information to identify the parcels
included in the district. The certification relates to the taxes payable year as provided in
subdivision 6.

(b) If the classification under section 273.13 of property located in a district changes
to a classification that has a different assessment ratio, the original net tax capacity of that
property must be redetermined at the time when its use is changed as if the property had
originally been classified in the same class in which it is classified after its use is changed.

(c) The amount to be added to the original net tax capacity of the district as a result
of previously tax exempt real property within the district becoming taxable equals the net
tax capacity of the real property as most recently assessed pursuant to section 273.18 or, if
that assessment was made more than one year prior to the date of title transfer rendering
the property taxable, the net tax capacity assessed by the assessor at the time of the
transfer. If improvements are made to tax exempt property after the municipality approves
the district and before the parcel becomes taxable, the assessor shall, at the request of
the authority, separately assess the estimated market value of the improvements. If the
property becomes taxable, the county auditor shall add to original net tax capacity, the net
tax capacity of the parcel, excluding the separately assessed improvements. If substantial
taxable improvements were made to a parcel after certification of the district and if the
property later becomes tax exempt, in whole or part, as a result of the authority acquiring
the property through foreclosure or exercise of remedies under a lease or other revenue
agreement or as a result of tax forfeiture, the amount to be added to the original net tax
capacity of the district as a result of the property again becoming taxable is the amount
of the parcel's value that was included in original net tax capacity when the parcel was
first certified. The amount to be added to the original net tax capacity of the district as a
result of enlargements equals the net tax capacity of the added real property as most
recently certified by the commissioner of revenue as of the date of modification of the tax
increment financing plan pursuant to section 469.175, subdivision 4.

(d) If the net tax capacity of a property increases because the property no longer
qualifies under the Minnesota Agricultural Property Tax Law, section 273.111; the
Minnesota Open Space Property Tax Law, section 273.112; or the Metropolitan
Agricultural Preserves Act, chapter 473H, new text begin the Rural Preserve Property Tax Program under
section 273.114,
new text end or because platted, unimproved property is improved or market value
is increased after approval of the plat under section 273.11, subdivision deleted text begin 14deleted text end deleted text begin ,deleted text end 14adeleted text begin ,deleted text end or 14b,
the increase in net tax capacity must be added to the original net tax capacity.new text begin If the
net tax capacity of a property increases because the property no longer qualifies for the
homestead market value exclusion under section 273.13, subdivision 35, the increase in
net tax capacity must be added to original net tax capacity if the original construction of
the affected home was completed before the date the assessor certified the original net
tax capacity of the district.
new text end

(e) The amount to be subtracted from the original net tax capacity of the district as a
result of previously taxable real property within the district becoming tax exemptnew text begin or
qualifying in whole or part for an exclusion from taxable market value
new text end , or a reduction in
the geographic area of the district, shall be the amount of original net tax capacity initially
attributed to the property becoming tax exemptnew text begin , being excluded from taxable market
value,
new text end or being removed from the district. If the net tax capacity of property located within
the tax increment financing district is reduced by reason of a court-ordered abatement,
stipulation agreement, voluntary abatement made by the assessor or auditor or by order
of the commissioner of revenue, the reduction shall be applied to the original net tax
capacity of the district when the property upon which the abatement is made has not been
improved since the date of certification of the district and to the captured net tax capacity
of the district in each year thereafter when the abatement relates to improvements made
after the date of certification. The county auditor may specify reasonable form and content
of the request for certification of the authority and any modification thereof pursuant to
section 469.175, subdivision 4.

(f) If a parcel of property contained a substandard building or improvements
described in section 469.174, subdivision 10, paragraph (e), that were demolished or
removed and if the authority elects to treat the parcel as occupied by a substandard
building under section 469.174, subdivision 10, paragraph (b), or by improvements under
section 469.174, subdivision 10, paragraph (e), the auditor shall certify the original net tax
capacity of the parcel using the greater of (1) the current net tax capacity of the parcel, or
(2) the estimated market value of the parcel for the year in which the building or other
improvements were demolished or removed, but applying the class rates for the current
year.

(g) For a redevelopment district qualifying under section 469.174, subdivision 10,
paragraph (a), clause (4), as a qualified disaster area, the auditor shall certify the value of
the land as the original tax capacity for any parcel in the district that contains a building
that suffered substantial damage as a result of the disaster or emergency.

Sec. 40.

Minnesota Statutes 2010, section 469.1793, is amended to read:


469.1793 DEVELOPER OBLIGATIONS CONTINUED.

If a developer or other private entity agreed to make payments to the authority or
municipality to reimburse the municipality for the state aid offset under Minnesota Statutes
2000, section 273.1399, the obligation continues in effect, notwithstanding the repeal of
section 273.1399. deleted text begin Payments received by the development authority are increments for
purposes of the state grant program under section 469.1799.
deleted text end

Sec. 41.

Minnesota Statutes 2010, section 469.1813, subdivision 6b, is amended to
read:


Subd. 6b.

Extended duration limit.

deleted text begin (a)deleted text end Notwithstanding the provisions of
subdivision 6, a political subdivision may grant an abatement for a period of up to 20
years, if the abatement is for deleted text begin a qualified business.
deleted text end

deleted text begin (b) To be a qualified business for purposes of this subdivision, at least 50 percent of
the payroll of the operations of the business that qualify for the abatement must be for
employees engaged in one of the following lines of business or any combination of them:
deleted text end

deleted text begin (1) manufacturing;
deleted text end

deleted text begin (2) agricultural processing;
deleted text end

deleted text begin (3) mining;
deleted text end

deleted text begin (4) research and development;
deleted text end

deleted text begin (5) warehousing; or
deleted text end

deleted text begin (6) qualified high technology.
deleted text end

deleted text begin Alternatively, a qualified business also includesdeleted text end a taxpayer whose real and personal
property is subject to valuation under Minnesota Rules, chapter 8100.

deleted text begin (c)(1) "Manufacturing" means the material staging and production of tangible
personal property by procedures commonly regarded as manufacturing, processing,
fabrication, or assembling which changes some existing material into new shapes, new
qualities, or new combinations.
deleted text end

deleted text begin (2) "Mining" has the meaning given in section 613(c) of the Internal Revenue Code
of 1986.
deleted text end

deleted text begin (3) "Agricultural processing" means transforming, packaging, sorting, or grading
livestock or livestock products, agricultural commodities, or plants or plant products into
goods that are used for intermediate or final consumption including goods for nonfood use.
deleted text end

deleted text begin (4) "Research and development" means qualified research as defined in section
41(d) of the Internal Revenue Code of 1986.
deleted text end

deleted text begin (5) "Qualified high technology" means one or more of the following activities:
deleted text end

deleted text begin (i) advanced computing, which is any technology used in the design and development
of any of the following:
deleted text end

deleted text begin (A) computer hardware and software;
deleted text end

deleted text begin (B) data communications; and
deleted text end

deleted text begin (C) information technologies;
deleted text end

deleted text begin (ii) advanced materials, which are materials with engineered properties created
through the development of specialized process and synthesis technology;
deleted text end

deleted text begin (iii) biotechnology, which is any technology that uses living organisms, cells,
macromolecules, microorganisms, or substances from living organisms to make or modify
a product, improve plants or animals, or develop microorganisms for useful purposes;
deleted text end

deleted text begin (iv) electronic device technology, which is any technology that involves
microelectronics, semiconductors, electronic equipment, and instrumentation, radio
frequency, microwave, and millimeter electronics, and optical and optic-electrical devices,
or data and digital communications and imaging devices;
deleted text end

deleted text begin (v) engineering or laboratory testing related to the development of a product;
deleted text end

deleted text begin (vi) technology that assists in the assessment or prevention of threats or damage to
human health or the environment, including, but not limited to, environmental cleanup
technology, pollution prevention technology, or development of alternative energy sources;
deleted text end

deleted text begin (vii) medical device technology, which is any technology that involves medical
equipment or products other than a pharmaceutical product that has therapeutic or
diagnostic value and is regulated; or
deleted text end

deleted text begin (viii) advanced vehicles technology which is any technology that involves electric
vehicles, hybrid vehicles, or alternative fuel vehicles, or components used in the
construction of electric vehicles, hybrid vehicles, or alternative fuel vehicles. An electric
vehicle is a road vehicle that draws propulsion energy only from an onboard source of
electrical energy. A hybrid vehicle is a road vehicle that can draw propulsion energy from
both a consumable fuel and a rechargeable energy storage system.
deleted text end

deleted text begin (d) The authority to grant new abatements under this subdivision expires on July 1,
2004, except that the authority to grant new abatements for real and personal property
subject to valuation under Minnesota Rules, chapter 8100, does not expire.
deleted text end

Sec. 42.

Minnesota Statutes 2010, section 473F.02, subdivision 3, is amended to read:


Subd. 3.

Commercial-industrial property.

"Commercial-industrial property"
means the following categories of property, as defined in section 273.13, excluding that
portion of such property deleted text begin (1) which may, by law, constitute the tax base for a tax increment
pledged under section 469.042 or 469.162, certification of which was requested prior to
August 1, 1979, to the extent and while such tax increment is so pledged; or (2)
deleted text end which is
exempt from taxation under section 272.02:

(a) That portion of class 3 property defined in Minnesota Statutes 1971, section
273.13, consisting of stocks of merchandise and furniture and fixtures used therewith;
manufacturers' materials and manufactured articles; and tools, implements and machinery,
whether fixtures or otherwise.

(b) That portion of class 4 property defined in Minnesota Statutes 1971, section
273.13, which is either used or zoned for use for any commercial or industrial purpose,
except for such property which is, or, in the case of property under construction, will when
completed be used exclusively for residential occupancy and the provision of services
to residential occupants thereof. Property shall be considered as used exclusively for
residential occupancy only if each of not less than 80 percent of its occupied residential
units is, or, in the case of property under construction, will when completed be occupied
under an oral or written agreement for occupancy over a continuous period of not less
than 30 days.

If the classification of property prescribed by section 273.13 is modified by
legislative amendment, the references in this subdivision shall be to such successor class
or classes of property, or portions thereof, as embrace the kinds of property designated
in this subdivision.

Sec. 43. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2010, sections 272.02, subdivision 83; 290.06, subdivisions
24 and 32; 297A.68, subdivision 41; 469.042, subdivisions 2, 3, and 4; 469.043;
469.059, subdivision 13; 469.129; 469.134; 469.162, subdivision 2; 469.1651; 469.166,
subdivisions 7, 8, 9, 10, 11, and 12; 469.167, subdivisions 1 and 3; 469.168; 469.169,
subdivisions 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, and 13; 469.170, subdivisions 1, 2, 3, 4, 5, 5a,
5b, 5c, 5d, 5e, 6, 7, and 8; 469.171, subdivisions 2, 5, and 6b; 469.173, subdivisions 1
and 3; 469.1765; 469.1791; 469.1799, subdivision 2; 469.301, subdivisions 1, 2, 3, 4, and
5; 469.302; 469.303; 469.304; 469.321; 469.3215; 469.322; 469.323; 469.324; 469.325;
469.326; 469.327; 469.328; 469.329; and 473.680,
new text end new text begin are repealed.
new text end

Sec. 44. new text begin EFFECTIVE DATE.
new text end

new text begin This article is effective August 1, 2012, and the tax increment financing provisions
apply to all districts, regardless of when the request for certification was made, provided
that the adjustments to original tax capacity required under Minnesota Statutes, section
469.177, subdivision 1, apply only to exclusions that reduced taxable market value
beginning with taxes payable in 2012 or thereafter, regardless of when the law authorizing
the exclusion became effective.
new text end

ARTICLE 8

PUBLIC FINANCE

Section 1.

Minnesota Statutes 2010, section 373.40, subdivision 1, is amended to read:


Subdivision 1.

Definitions.

For purposes of this section, the following terms have
the meanings given.

(a) "Bonds" means an obligation as defined under section 475.51.

(b) "Capital improvement" means acquisition or betterment of public lands,
buildings, or other improvements within the county for the purpose of a county courthouse,
administrative building, health or social service facility, correctional facility, jail, law
enforcement center, hospital, morgue, library, park, qualified indoor ice arena, roads
and bridges,new text begin public works facilities, fairgrounds buildings, and records and data storage
facilities,
new text end and the acquisition of development rights in the form of conservation easements
under chapter 84C. An improvement must have an expected useful life of five years or
more to qualify. "Capital improvement" does not include a recreation or sports facility
building (such as, but not limited to, a gymnasium, ice arena, racquet sports facility,
swimming pool, exercise room or health spa), unless the building is part of an outdoor
park facility and is incidental to the primary purpose of outdoor recreation.

(c) "Metropolitan county" means a county located in the seven-county metropolitan
area as defined in section 473.121 or a county with a population of 90,000 or more.

(d) "Population" means the population established by the most recent of the
following (determined as of the date the resolution authorizing the bonds was adopted):

(1) the federal decennial census,

(2) a special census conducted under contract by the United States Bureau of the
Census, or

(3) a population estimate made either by the Metropolitan Council or by the state
demographer under section 4A.02.

(e) "Qualified indoor ice arena" means a facility that meets the requirements of
section 373.43.

(f) "Tax capacity" means total taxable market value, but does not include captured
market value.

Sec. 2.

Minnesota Statutes 2010, section 373.40, subdivision 2, is amended to read:


Subd. 2.

Application of election requirement.

(a) Bonds issued by a county
to finance capital improvements under an approved capital improvement plan are not
subject to the election requirements of section 375.18 or 475.58. The bonds must be
approved by vote of at least three-fifths of the members of the county board. In the case
of a metropolitan county, the bonds must be approved by vote of at least two-thirds of
the members of the county board.

(b) Before issuance of bonds qualifying under this section, the county must publish
a notice of its intention to issue the bonds and the date and time of a hearing to obtain
public comment on the matter. The notice must be published in the official newspaper
of the county or in a newspaper of general circulation in the county. The notice must be
published at least 14, but not more than 28, days before the date of the hearing.

(c) A county may issue the bonds only upon obtaining the approval of a majority of
the voters voting on the question of issuing the obligations, if a petition requesting a vote
on the issuance is signed by voters equal to five percent of the votes cast in the county in
the last new text begin county new text end general election and is filed with the county auditor within 30 days after
the public hearing. deleted text begin The commissioner of revenue shall prepare a suggested form of the
question to be presented at the election
deleted text end new text begin If the county elects not to submit the question to
the voters, the county shall not propose the issuance of bonds under this section for the
same purpose and in the same amount for a period of 365 days from the date of receipt
of the petition. If the question of issuing the bonds is submitted and not approved by the
voters, the provisions of section 475.58, subdivision 1a, apply
new text end .

Sec. 3.

Minnesota Statutes 2010, section 373.40, subdivision 4, is amended to read:


Subd. 4.

Limitations on amount.

A county may not issue bonds under this section
if the maximum amount of principal and interest to become due in any year on all the
outstanding bonds issued pursuant to this section (including the bonds to be issued) will
equal or exceed 0.12 percent of taxable market value of property in the county. Calculation
of the limit must be made using the taxable market value for the taxes payable year in
which the obligations are issued and soldnew text begin , provided that, for purposes of determining
the principal and interest due in any year, the county may deduct the amount of interest
expected to be paid or reimbursed to the county by the federal government in that year on
any outstanding bonds or the bonds to be issued
new text end . This section does not limit the authority
to issue bonds under any other special or general law.

Sec. 4.

Minnesota Statutes 2010, section 474A.02, subdivision 23a, is amended to read:


Subd. 23a.

Qualified bonds.

"Qualified bonds" means the specific type or types
of obligations that are subject to the annual volume cap. Qualified bonds include the
following types of obligations as defined in federal tax law:

(a) "public facility bonds" means "exempt facility bonds" as defined in federal
tax law, except for residential rental project bondsdeleted text begin , which are those obligations issued
to finance airports, docks and wharves, mass commuting facilities, facilities for the
furnishing of water, sewage facilities, solid waste disposal facilities, facilities for the
local furnishing of electric energy or gas, local district heating or cooling facilities, and
qualified hazardous waste facilities
deleted text end . New bonds and other obligations are ineligible to
receive state allocations or entitlement authority for public facility projects under this
section if they have been issued:

(1) for the purpose of refinancing, refunding, or otherwise defeasing existing debt;
and

(2) more than one calendar year prior to the date of application;

(b) "residential rental project bonds" which are those obligations issued to finance
qualified residential rental projects;

(c) "mortgage bonds";

(d) "small issue bonds" issued to finance manufacturing projects and the acquisition
or improvement of agricultural real or personal property under sections 41C.01 to 41C.13;

(e) "student loan bonds" issued by or on behalf of the Minnesota Office of Higher
Education;

(f) "redevelopment bonds";

(g) "governmental bonds" with a nonqualified amount in excess of $15,000,000 as
set forth in section 141(b)5 of federal tax law; and

(h) "enterprise zone facility bonds" issued to finance facilities located within
empowerment zones or enterprise communities, as authorized under deleted text begin Public Law 103-66,
section 13301
deleted text end new text begin section 1394 of the Internal Revenue Codenew text end .

Sec. 5.

Minnesota Statutes 2010, section 474A.04, subdivision 1a, is amended to read:


Subd. 1a.

Entitlement reservationsdeleted text begin ; carryforward; deductiondeleted text end .

Any amount
returned by an entitlement issuer before July 15 shall be reallocated through the housing
pool. Any amount returned on or after July 15 shall be reallocated through the unified
pool. An amount returned after the last Monday in November shall be reallocated to the
Minnesota housing finance agency. deleted text begin Any amount of bonding authority that an entitlement
issuer carries forward under federal tax law that is not permanently issued or for which
the governing body of the entitlement issuer has not enacted a resolution electing to use
the authority for mortgage credit certificates and has not provided a notice of issue to the
commissioner before 4:30 p.m. on the last business day in December of the succeeding
calendar year shall be deducted from the entitlement allocation for that entitlement issuer
in the next succeeding calendar year. Any amount deducted from an entitlement issuer's
allocation under this subdivision shall be reallocated to other entitlement issuers, the
housing pool, the small issue pool, and the public facilities pool on a proportional basis
consistent with section 474A.03.
deleted text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment
and applies to any bonding authority allocated in 2011 and subsequent years.
new text end

Sec. 6.

Minnesota Statutes 2010, section 474A.062, is amended to read:


474A.062 MINNESOTA OFFICE OF HIGHER EDUCATION 120-DAY
ISSUANCE EXEMPTION.

The Minnesota Office of Higher Education is exempt from the 120-day issuance
requirements in this chapter and may carry forward allocations for student loan bonds
deleted text begin into one successive calendar yeardeleted text end , subject to carryforward notice requirements of section
474A.131, subdivision 2.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment
and applies to any bonding authority allocated in 2011 and subsequent years.
new text end

Sec. 7.

Minnesota Statutes 2010, section 474A.091, subdivision 3a, is amended to read:


Subd. 3a.

Mortgage bonds.

(a) Bonding authority remaining in the unified pool on
October 1 is available for single-family housing programs for cities that applied in January
and received an allocation under section 474A.061, subdivision 2a, in the same calendar
year. The Minnesota Housing Finance Agency shall receive an allocation for mortgage
bonds pursuant to this section, minus any amounts for a city or consortium that intends to
issue bonds on its own behalf under paragraph (c).

(b) The agency may issue bonds on behalf of participating cities. The agency shall
request an allocation from the commissioner for all applicants who choose to have the
agency issue bonds on their behalf and the commissioner shall allocate the requested
amount to the agency. Allocations shall be awarded by the commissioner each Monday
commencing on the first Monday in October through the last Monday in November for
applications received by 4:30 p.m. on the Monday of the week preceding an allocation.

For cities who choose to have the agency issue bonds on their behalf, allocations
will be made loan by loan, on a first-come, first-served basis among the cities. The
agency shall submit an application fee pursuant to section 474A.03, subdivision 4, and an
application deposit equal to two percent of the requested allocation to the commissioner
when requesting an allocation from the unified pool. After awarding an allocation and
receiving a notice of issuance for mortgage bonds issued on behalf of the participating
cities, the commissioner shall transfer the application deposit to the Minnesota Housing
Finance Agency.

For purposes of paragraphs (a) to (d), "city" means a county or a consortium of
local government units that agree through a joint powers agreement to apply together
for single-family housing programs, and has the meaning given it in section 462C.02,
subdivision 6
. "Agency" means the Minnesota Housing Finance Agency.

(c) Any city that received an allocation pursuant to section 474A.061, subdivision
2a, paragraph (f)
, in the current year that wishes to receive an additional allocation from
the unified pool and issue bonds on its own behalf or pursuant to a joint powers agreement
shall notify the Minnesota Housing Finance Agency by the third Monday in September.
The total amount of allocation for mortgage bonds for a city choosing to issue bonds on its
own behalf or through a joint powers agreement is limited to the lesser of: (i) the amount
requested, or (ii) the product of the total amount available for mortgage bonds from the
unified pool, multiplied by the ratio of the population of each city that applied in January
and received an allocation under section 474A.061, subdivision 2a, in the same calendar
year, as determined by the most recent estimate of the city's population released by the
state demographer's office to the total of the population of all the cities that applied in
January and received an allocation under section 474A.061, subdivision 2a, in the same
calendar year. If a city choosing to issue bonds on its own behalf or through a joint powers
agreement is located within a county that has also chosen to issue bonds on its own behalf
or through a joint powers agreement, the city's population will be deducted from the
county's population in calculating the amount of allocations under this paragraph.

The Minnesota Housing Finance Agency shall notify each city choosing to issue
bonds on its own behalf or pursuant to a joint powers agreement of the amount of its
allocation by October 15. Upon determining the amount of the allocation of each choosing
to issue bonds on its own behalf or through a joint powers agreement, the agency shall
forward a list specifying the amounts allotted to each city.

A city that chooses to issue bonds on its own behalf or through a joint powers
agreement may request an allocation from the commissioner by forwarding an application
with an application fee pursuant to section 474A.03, subdivision 4, and an application
deposit equal to two percent of the requested amount to the commissioner no later than
4:30 p.m. on the Monday of the week preceding an allocation. Allocations to cities that
choose to issue bonds on their own behalf shall be awarded by the commissioner on
the first Monday after October 15 through the last Monday in November. No city may
receive an allocation from the commissioner after the last Monday in November. The
commissioner shall allocate the requested amount to the city or cities subject to the
limitations under this subdivision.

If a city issues mortgage bonds from an allocation received under this paragraph,
the issuer must provide for the recycling of funds into new loans. If the issuer is not
able to provide for recycling, the issuer must notify the commissioner in writing of the
reason that recycling was not possible and the reason the issuer elected not to have the
Minnesota Housing Finance Agency issue the bonds. "Recycling" means the use of money
generated from the repayment and prepayment of loans for further eligible loans or for the
redemption of bonds and the issuance of current refunding bonds.

(d) No entitlement city or county or city in an entitlement county may apply for or
be allocated authority to issue mortgage bonds or use mortgage credit certificates from
the unified pool.

(e) An allocation awarded to the agency for mortgage bonds under this section
may be carried forward by the agency deleted text begin into the next succeeding calendar yeardeleted text end subject to
notice requirements under section 474A.131 deleted text begin and is available until the last business day in
December of that succeeding calendar year
deleted text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment
and applies to any bonding authority allocated in 2011 and subsequent years.
new text end

Sec. 8.

Minnesota Statutes 2010, section 475.521, subdivision 2, is amended to read:


Subd. 2.

Election requirement.

(a) Bonds issued by a municipality to finance
capital improvements under an approved capital improvements plan are not subject to the
election requirements of section 475.58. The bonds must be approved by an affirmative
vote of three-fifths of the members of a five-member governing body. In the case of a
governing body having more or less than five members, the bonds must be approved by a
vote of at least two-thirds of the members of the governing body.

(b) Before the issuance of bonds qualifying under this section, the municipality
must publish a notice of its intention to issue the bonds and the date and time of the
hearing to obtain public comment on the matter. The notice must be published in the
official newspaper of the municipality or in a newspaper of general circulation in the
municipality. Additionally, the notice may be posted on the official Web site, if any, of the
municipality. The notice must be published at least 14 but not more than 28 days before
the date of the hearing.

(c) A municipality may issue the bonds only after obtaining the approval of a
majority of the voters voting on the question of issuing the obligations, if a petition
requesting a vote on the issuance is signed by voters equal to five percent of the votes cast
in the municipality in the last new text begin municipal new text end general election and is filed with the clerk within
30 days after the public hearing. deleted text begin The commissioner of revenue shall prepare a suggested
form of the question to be presented at the election
deleted text end new text begin If the municipality elects not to submit
the question to the voters, the municipality shall not propose the issuance of bonds under
this section for the same purpose and in the same amount for a period of 365 days from the
date of receipt of the petition. If the question of issuing the bonds is submitted and not
approved by the voters, the provisions of section 475.58, subdivision 1a, apply
new text end .

Sec. 9.

Minnesota Statutes 2010, section 475.521, subdivision 4, is amended to read:


Subd. 4.

Limitations on amount.

A municipality may not issue bonds under
this section if the maximum amount of principal and interest to become due in any
year on all the outstanding bonds issued under this section, including the bonds to be
issued, will equal or exceed 0.16 percent of the taxable market value of property in the
municipality. Calculation of the limit must be made using the taxable market value for
the taxes payable year in which the obligations are issued and soldnew text begin , provided that, for
purposes of determining the principal and interest due in any year, the municipality may
deduct the amount of interest expected to be paid or reimbursed to the municipality by the
federal government in that year on any outstanding bonds or the bonds to be issued
new text end . In
the case of a municipality with a population of 2,500 or more, the bonds are subject to
the net debt limits under section 475.53. In the case of a shared facility in which more
than one municipality participates, upon compliance by each participating municipality
with the requirements of subdivision 2, the limitations in this subdivision and the net debt
represented by the bonds shall be allocated to each participating municipality in proportion
to its required financial contribution to the financing of the shared facility, as set forth in
the joint powers agreement relating to the shared facility. This section does not limit the
authority to issue bonds under any other special or general law.

Sec. 10.

Minnesota Statutes 2010, section 475.58, subdivision 3b, is amended to read:


Subd. 3b.

Street reconstruction.

(a) A municipality may, without regard to
the election requirement under subdivision 1, issue and sell obligations for street
reconstruction, if the following conditions are met:

(1) the streets are reconstructed under a street reconstruction plan that describes the
street reconstruction to be financed, the estimated costs, and any planned reconstruction
of other streets in the municipality over the next five years, and the plan and issuance of
the obligations has been approved by a vote of all of the members of the governing body
present at the meeting following a public hearing for which notice has been published in
the official newspaper at least ten days but not more than 28 days prior to the hearing; and

(2) if a petition requesting a vote on the issuance is signed by voters equal to
five percent of the votes cast in the last municipal general election and is filed with the
municipal clerk within 30 days of the public hearing, the municipality may issue the bonds
only after obtaining the approval of a majority of the voters voting on the question of the
issuance of the obligationsnew text begin . If the municipality elects not to submit the question to the
voters, the municipality shall not propose the issuance of bonds under this section for the
same purpose and in the same amount for a period of 365 days from the date of receipt
of the petition. If the question of issuing the bonds is submitted and not approved by the
voters, the provisions of subdivision 1a, apply
new text end .

(b) Obligations issued under this subdivision are subject to the debt limit of the
municipality and are not excluded from net debt under section 475.51, subdivision 4.

(c) For purposes of this subdivision, street reconstruction includes utility
replacement and relocation and other activities incidental to the street reconstruction, turn
lanes and other improvements having a substantial public safety function, realignments,
other modifications to intersect with state and county roads, and the local share of state
and county road projects.

(d) Except in the case of turn lanes, safety improvements, realignments, intersection
modifications, and the local share of state and county road projects, street reconstruction
does not include the portion of project cost allocable to widening a street or adding curbs
and gutters where none previously existed.

Sec. 11.

Laws 1971, chapter 773, section 1, subdivision 2, as amended by Laws 1974,
chapter 351, section 5, Laws 1976, chapter 234, sections 1 and 7, Laws 1978, chapter 788,
section 1, Laws 1981, chapter 369, section 1, Laws 1983, chapter 302, section 1, Laws
1988, chapter 513, section 1, Laws 1992, chapter 511, article 9, section 23, Laws 1998,
chapter 389, article 3, section 27, and Laws 2002, chapter 390, section 23, is amended to
read:


Subd. 2. For each of the years deleted text begin 2003 to 2013deleted text end new text begin 2012 to 2024new text end , the city of St. Paul is
authorized to issue bonds in the aggregate principal amount of deleted text begin $20,000,000deleted text end new text begin $25,000,000new text end
for each year.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 12.

Laws 2003, chapter 127, article 12, section 28, is amended to read:


Sec. 28. NURSING HOME BONDS AUTHORIZED.

Itasca County may issue bonds under Minnesota Statutes, sections 376.55 and
376.56, to finance the construction of a 35-bed nursing home facility to replace an existing
35-bed private facility located in the county. The bonds issued under this section deleted text begin mustdeleted text end new text begin
may
new text end be payable solely from revenues deleted text begin anddeleted text end new text begin ornew text end may deleted text begin notdeleted text end be general obligations of the county.

new text begin EFFECTIVE DATE; LOCAL APPROVAL. new text end

new text begin This section is effective the day after
the governing body of Itasca County and its chief clerical officer timely complete their
compliance with Minnesota Statutes, section 645.021, subdivisions 2 and 3.
new text end

Sec. 13. new text begin CARRYFORWARD OF BONDING AUTHORITY FOR 2008, 2009,
AND 2010; NO DEDUCTION FROM ENTITLEMENT ALLOCATION.
new text end

new text begin Notwithstanding Minnesota Statutes, section 474A.04, subdivision 1a, and Laws
2009, chapter 88, article 6, section 27, bonding authority that was allocated to an
entitlement issuer in 2008, 2009, and 2010 and that was carried forward under federal
tax law, but for which the entitlement issuer did not provide a notice of issue to the
commissioner of management and budget before 4:30 p.m. on the last business day of
December 2011 must not be deducted from the entitlement allocation for that entitlement
issuer in 2012.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment
and applies retroactively to rescind any reallocation by the commissioner of management
and budget under Minnesota Statutes, section 474A.04, subdivision 1a, of any amounts so
deducted.
new text end

Sec. 14. new text begin WOODBURY; EXEMPTION FROM REFERENDUM.
new text end

new text begin (a) Notwithstanding the referendum requirement in Minnesota Statutes, section
475.58, subdivision 1, or any other provision of law, the city of Woodbury may issue and
sell obligations to pay for the cost of renovating, improving, expanding, and equipping the
Bielenberg Sports Center, along with costs of issuance of the obligations and capitalized
interest, if:
new text end

new text begin (1) the obligations are secured by a pledge of revenues from the facility; and
new text end

new text begin (2) the city finds, based on analysis provided by a professional experienced in
finance, that the facility's revenues and a property tax levy equal to the maximum annual
property tax levy used to pay the bonds previously issued to finance, in whole or in part,
the facility will in the aggregate be sufficient to pay the obligations without the imposition
of an additional property tax levy pledged to the obligations.
new text end

new text begin (b) Before issuing bonds under this section, the city must publish a notice of its
intention to issue the bonds and the date and time of a hearing to obtain public comment
on the matter. The notice must be published on the official Web site of the city or in a
newspaper of general circulation in the city. The notice must be published at least 14 but
not more than 28 days before the date of the hearing. The city may issue the bonds only
upon obtaining the approval of a majority of the voters voting on the question of issuing
the obligations, if a petition requesting a vote on the issuance is signed by voters equal to
five percent of the votes cast in the city in the last general election and is filed with the city
clerk within 30 days after the public hearing.
new text end

new text begin EFFECTIVE DATE; LOCAL APPROVAL. new text end

new text begin This section is effective the day after
the governing body of the city of Woodbury and its chief clerical officer timely complete
their compliance with Minnesota Statutes, section 645.021, subdivisions 2 and 3.
new text end

ARTICLE 9

SALES TAXES

Section 1.

Minnesota Statutes 2010, section 297A.8155, is amended to read:


297A.8155 LIQUOR REPORTING REQUIREMENTS; PENALTY.

new text begin (a) new text end A person who sells liquor, as defined in section 295.75, subdivision 1, in
Minnesota to a retailer that sells liquor, shall file with the commissioner an annual
informational report, in the form and manner prescribed by the commissioner, indicating
the name, address, and Minnesota business identification number of each retailer, and the
total dollar amount of liquor sold to each retailer in the previous calendar year. The report
must be filed on or before March 31 following the close of the calendar year. A person
failing to file this report is subject to the penalty imposed under section 289A.60.new text begin A
person required to file a report under this section is not required to provide a copy of an
exemption certificate, as defined in section 297A.72, provided to the person by a retailer,
along with the annual informational report.
new text end

new text begin (b) A person who was required to submit an annual informational report under this
section to the commissioner of revenue during calendar year 2010 or 2011 is not required
to provide a copy of an exemption certificate or a retailer's tax identification number
along with the informational report.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin Paragraph (a) is effective for reports required to be filed
beginning in calendar year 2012 and thereafter. Paragraph (b) is effective the day following
final enactment and applies to reports required to be filed in calendar year 2010 or 2011.
new text end

Sec. 2.

Minnesota Statutes 2010, section 297A.99, subdivision 4, is amended to read:


Subd. 4.

Tax base.

(a) The tax applies to sales taxable under this chapter that occur
within the political subdivision.

(b) Taxable goods or services are subject to a political subdivision's sales tax, if they
are sourced to the political subdivision pursuant to section 297A.668.

new text begin (c) The requirement in paragraph (a) only applies to a local sales tax of general
applicability; and to local taxes on specific items such as lodging, food and beverage, and
admissions, if explicitly provided for in the authorizing law. The issue of whether the tax
is collected by the commissioner has no bearing on this subdivision.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective retroactively from July 1, 2011.
new text end

Sec. 3.

Laws 1998, chapter 389, article 8, section 43, subdivision 3, as amended by
Laws 2005, First Special Session chapter 3, article 5, section 28, and Laws 2011, First
Special Session chapter 7, article 4, section 5, is amended to read:


Subd. 3.

Use of revenues.

(a) Revenues received from the taxes authorized by
subdivisions 1 and 2 must be used by the city to pay for the cost of collecting and
administering the taxes and to pay for the following projects:

(1) transportation infrastructure improvements including regional highway and
airport improvements;

(2) improvements to the civic center complex;

(3) a municipal water, sewer, and storm sewer project necessary to improve regional
ground water quality; and

(4) construction of a regional recreation and sports center and other higher education
facilities available for both community and student use.

(b) The total amount of capital expenditures or bonds for projects listed in paragraph
(a) that may be paid from the revenues raised from the taxes authorized in this section
may not exceed $111,500,000. The total amount of capital expenditures or bonds for the
project in clause (4) that may be paid from the revenues raised from the taxes authorized
in this section may not exceed $28,000,000.

(c) In addition to the projects authorized in paragraph (a) and not subject to the
amount stated in paragraph (b), the city of Rochester may, if approved by the voters at an
election under subdivision 5, paragraph (c), use the revenues received from the taxes and
bonds authorized in this section to pay the costs of or bonds for the following purposes:

(1) $17,000,000 for capital expenditures and bonds for the following Olmsted
County transportation infrastructure improvements:

(i) County State Aid Highway 34 reconstruction;

(ii) Trunk Highway 63 and County State Aid Highway 16 interchange;

(iii) phase II of the Trunk Highway 52 and County State Aid Highway 22
interchange;

(iv) widening of County State Aid Highway 22 West Circle Drive; and

(v) 60th Avenue Northwest corridor preservation;

(2) $30,000,000 for city transportation projects including:

(i) Trunk Highway 52 and 65th Street interchange;

(ii) NW transportation corridor acquisition;

(iii) Phase I of the Trunk Highway 52 and County State Aid Highway 22 interchange;

(iv) Trunk Highway 14 and Trunk Highway 63 intersection;

(v) Southeast transportation corridor acquisition;

(vi) Rochester International Airport expansion; and

(vii) a transit operations center bus facility;

(3) $14,000,000 for the University of Minnesota Rochester academic and
complementary facilities;

(4) $6,500,000 for the Rochester Community and Technical College/Winona State
University career technical education and science and math facilities;

(5) $6,000,000 for the Rochester Community and Technical College regional
recreation facilities at University Center Rochester;

(6) $20,000,000 for the Destination Medical Community Initiative;

(7) $8,000,000 for the regional public safety and 911 dispatch center facilities;

(8) $20,000,000 for a regional recreation/senior center;

(9) $10,000,000 for an economic development fund; and

(10) $8,000,000 for downtown infrastructure.

(d) No revenues from the taxes raised from the taxes authorized in subdivisions 1
and 2 may be used to fund transportation improvements related to a railroad bypass that
would divert traffic from the city of Rochester.

(e) The city shall use $5,000,000 of the money allocated to the purpose in paragraph
(c), clause (9), for grants to the cities of Byron, Chatfield, Dodge Center, Dover, Elgin,
Eyota, Kasson, Mantorville, Oronoco, Pine Island, Plainview, St. Charles, Stewartville,
Zumbrota, Spring Valley, West Concord, deleted text begin anddeleted text end Hayfieldnew text begin , and any other city with a 2010
population of at least 1,000 that has a city boundary within 25 miles of the geographic
center of Rochester and is closer to Rochester than to any other city with a population of
20,000 or more,
new text end for economic development projects that these communities would fund
through their economic development authority or housing and redevelopment authority.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 4.

Laws 2002, chapter 377, article 3, section 25, as amended by Laws 2009,
chapter 88, article 4, section 19, and Laws 2010, chapter 389, article 5, section 3, is
amended to read:


Sec. 25. ROCHESTER LODGING TAX.

Subdivision 1.

Authorization.

Notwithstanding Minnesota Statutes, section
469.190 or 477A.016, or any other law, the city of Rochester may impose an additional
tax of one percent on the gross receipts from the furnishing for consideration of lodging at
a hotel, motel, rooming house, tourist court, or resort, other than the renting or leasing of it
for a continuous period of 30 days or more.

Subd. 1a.

Authorization.

Notwithstanding Minnesota Statutes, section 469.190
or 477A.016, or any other law, and in addition to the tax authorized by subdivision 1,
the city of Rochester may impose an additional tax of deleted text begin onedeleted text end new text begin threenew text end percent on the gross
receipts from the furnishing for consideration of lodging at a hotel, motel, rooming house,
tourist court, or resort, other than the renting or leasing of it for a continuous period of
30 days or more only upon the approval of the city governing body of a total financial
package for the project.

Subd. 2.

Disposition of proceeds.

(a) The gross proceeds from the tax imposed
under subdivision 1 must be used by the city to fund a local convention or tourism bureau
for the purpose of marketing and promoting the city as a tourist or convention center.

(b) The gross proceeds from the deleted text begin onedeleted text end new text begin threenew text end percent tax imposed under subdivision
1a shall be used to pay for (1) construction, renovation, improvement, and expansion of
the Mayo Civic Center and related skyway access, lighting, parking, or landscaping; and
(2) for payment of any principal, interest, or premium on bonds issued to finance the
construction, renovation, improvement, and expansion of the Mayo Civic Center Complex.

Subd. 2a.

Bonds.

The city of Rochester may issue, without an election, general
obligation bonds of the city, in one or more series, in the aggregate principal amount
not to exceed $43,500,000, to pay for capital and administrative costs for the design,
construction, renovation, improvement, and expansion of the Mayo Civic Center Complex,
and related skyway, access, lighting, parking, and landscaping. The city may pledge
the lodging tax authorized by subdivision 1a deleted text begin and the food and beverage tax authorized
under Laws 2009, chapter 88, article 4, section 23,
deleted text end to the payment of the bonds. The debt
represented by the bonds is not included in computing any debt limitations applicable to
the city, and the levy of taxes required by Minnesota Statutes, section 475.61, to pay the
principal of and interest on the bonds is not subject to any levy limitation or included in
computing or applying any levy limitation applicable to the city.

Subd. 3.

Expiration of taxing authority.

The authority of the city to impose a
tax under subdivision 1a shall expire when the principal and interest on any bonds or
other obligations issued prior to December 31, deleted text begin 2014deleted text end new text begin 2016new text end , to finance the construction,
renovation, improvement, and expansion of the Mayo Civic Center Complex and related
skyway access, lighting, parking, or landscaping have been paid, including any bonds
issued to refund such bonds, or at an earlier time as the city shall, by ordinance, determine.
Any funds remaining after completion of the project and retirement or redemption of the
bonds shall be placed in the general fund of the city.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day after the governing body of
the city of Rochester and its chief clerical officer comply with Minnesota Statutes, section
645.021, subdivisions 2 and 3.
new text end

Sec. 5.

Laws 2005, First Special Session chapter 3, article 5, section 37, subdivision 2,
is amended to read:


Subd. 2.

Use of revenues.

(a) Revenues received from the tax authorized by
subdivision 1 by the city of St. Cloud must be used for the cost of collecting and
administering the tax and to pay all or part of the capital or administrative costs of the
development, acquisition, construction, improvement, and securing and paying debt
service on bonds or other obligations issued to finance the following regional projects as
approved by the voters and specifically detailed in the referendum authorizing the taxnew text begin or
extending the tax
new text end :

(1) St. Cloud Regional Airport;

(2) regional transportation improvements;

(3) new text begin regional new text end community and aquatics centersnew text begin and facilitiesnew text end ;

(4) regional public libraries; and

(5) acquisition and improvement of regional park land and open space.

(b) Revenues received from the tax authorized by subdivision 1 by the cities of St.
Joseph, Waite Park, Sartell, Sauk Rapids, and St. Augusta must be used for the cost of
collecting and administering the tax and to pay all or part of the capital or administrative
costs of the development, acquisition, construction, improvement, and securing and paying
debt service on bonds or other obligations issued to fund the projects specifically approved
by the voters at the referendum authorizing the taxnew text begin or extending the taxnew text end . The portion of
revenues from the city going to fund the regional airport or regional library located in the
city of St. Cloud will be as required under the applicable joint powers agreement.

(c) The use of revenues received from the taxes authorized in subdivision 1 for
projects allowed under paragraphs (a) and (b) are limited to the amount authorized for
each project under the enabling referendum.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day after the governing body of
each city that approves it complies with Minnesota Statutes, section 645.021, subdivision
3.
new text end

Sec. 6.

Laws 2005, First Special Session chapter 3, article 5, section 37, subdivision 4,
is amended to read:


Subd. 4.

Termination of tax.

The tax imposed in the cities of St. Joseph, St. Cloud,
St. Augusta, Sartell, Sauk Rapids, and Waite Park under subdivision 1 expires when the
city council determines that sufficient funds have been collected from the tax to retire or
redeem the bonds and obligations authorized under subdivision 2, paragraph (a), but no
later than December 31, 2018.new text begin Notwithstanding Minnesota Statutes, section 297A.99,
subdivision 3, paragraphs (a), (c), and (d), a city may extend the tax imposed under
subdivision 1 through December 31, 2038, if approved under the referendum authorizing
the tax under subdivision 1 or if approved by voters of the city at a general election held
no later than November 6, 2017.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day after the governing body of
each city that approves it complies with Minnesota Statutes, section 645.021, subdivision
3.
new text end

Sec. 7.

Laws 2008, chapter 366, article 7, section 19, subdivision 3, as amended by
Laws 2011, First Special Session chapter 7, article 4, section 8, is amended to read:


Subd. 3.

Use of revenues.

Notwithstanding Minnesota Statutes, section 297A.99,
subdivision 3
, paragraph (b), the proceeds of the tax imposed under this section shall be
used to pay for the costs of new text begin improvements to the Sportsman Park/Ballfields, Riverside
Park, Lions Park/Pavilion, Cedar South Park also known as Eldorado Park, and Spring
Street Park; improvements to and extension of the River County bike trail;
new text end acquisitiondeleted text begin ,deleted text end new text begin
and
new text end constructiondeleted text begin , improvement, and development of regional parks, bicycle trails, park
land, open space, and
deleted text end new text begin of a new text end pedestrian deleted text begin walkways, as described in the city improvement plan
adopted by the city council by resolution on December 12, 2006, and
deleted text end new text begin walkway over
Interstate 94 and State Highway 24; and the acquisition of
new text end land and new text begin construction of
new text end buildings for a community and recreation center. The total amount of revenues from the
taxes in subdivisions 1 and 2 that may be used to fund these projects is $12,000,000
plus any associated bond costs.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day after compliance by the
governing body of the city of Clearwater with Minnesota Statutes, section 645.021,
subdivisions 2 and 3.
new text end

Sec. 8. new text begin CITY OF PROCTOR; LOCAL TAXES AUTHORIZED.
new text end

new text begin Subdivision 1. new text end

new text begin Food and beverage tax authorized. new text end

new text begin Notwithstanding Minnesota
Statutes, section 477A.016, or any ordinance, city charter, or other provision of law, the
city of Proctor may, by ordinance, impose a sales tax of up to one percent on the gross
receipts of all food and beverages sold by a restaurant or place of refreshment, as defined
by resolution of the city, that is located within the city. For purposes of this section, "food
and beverages" include retail on-sale of intoxicating liquor and fermented malt beverages.
new text end

new text begin Subd. 2. new text end

new text begin Entertainment tax. new text end

new text begin Notwithstanding Minnesota Statutes, section
477A.016, or any ordinance, city charter, or other provision of law, the city of Proctor
may, by ordinance, impose a tax of up to one percent on the gross receipts on admissions
to an entertainment event, as defined by resolution of the city, located within the city. For
purposes of this section, "entertainment event" means any event for which persons pay
money in order to be admitted to the premises and to be entertained, including, but not
limited to, theaters, concerts, sporting events, circuses, and fairs.
new text end

new text begin Subd. 3. new text end

new text begin Use of proceeds from authorized taxes. new text end

new text begin The proceeds of the taxes
imposed under subdivisions 1 and 2 must be used by the city to fund: (1) operational
costs of the Proctor recreation center, golf course, community center, and the South
St. Louis County fairgrounds; and (2) construction and improvement of walking and
bicycle trails and a multiuse civic center facility, parking improvements, festival and
event coordination, and improvements related to the redevelopment and realignment of a
road through the fairgrounds property recently ceded to the city of Proctor by the city of
Duluth. Authorized expenses include securing or paying debt service on bonds or other
obligations issued to finance construction and improvement projects.
new text end

new text begin Subd. 4. new text end

new text begin Collection, administration, and enforcement. new text end

new text begin The city may enter into
an agreement with the commissioner of revenue to administer, collect, and enforce the
taxes under subdivision 1. If the commissioner agrees to collect the tax, the provisions
of Minnesota Statutes, section 297A.99, related to collection, administration, and
enforcement apply.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day after the governing body of
the city of Proctor and its chief clerical officer comply with Minnesota Statutes, section
645.021, subdivisions 2 and 3.
new text end

Sec. 9. new text begin SOLICITOR NEXUS STUDY.
new text end

new text begin (a) The Department of Revenue shall conduct a study on solicitor nexus, which must
include: a review of similar laws proposed and enacted in other states and if enacted, their
revenue impacts; a discussion of the legal questions raised by state solicitor nexus laws; the
impact of Internet sales in Minnesota; the status and potential impact to states of federal
legislation on the issue; and any other information applicable to solicitor nexus laws.
new text end

new text begin (b) By January 15, 2013, the commissioner shall submit a report on the study
required under this section to the chairs and ranking minority members of the house of
representatives and senate committees with jurisdiction over taxation, of the findings of
the study and identification of issues for policy makers to consider in whether to adopt a
solicitor nexus provision.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 10. new text begin REPEALER.
new text end

new text begin Laws 2009, chapter 88, article 4, section 23, as amended by Laws 2010, chapter 389,
article 5, section 4,
new text end new text begin is repealed.
new text end

ARTICLE 10

PROPERTY TAXES

Section 1.

Minnesota Statutes 2010, section 126C.48, subdivision 8, is amended to read:


Subd. 8.

Taconite payment and other reductions.

(1) Reductions in levies
pursuant to subdivision 1 must be made prior to the reductions in clause (2).

(2) Notwithstanding any other law to the contrary, districts that have revenue
pursuant to sections 298.018; 298.225; 298.24 to 298.28, except an amount distributed
under sections 298.26; 298.28, subdivision 4, paragraphs (c), clause (ii), and (d); 298.34 to
298.39; 298.391 to 298.396; 298.405; 477A.15; and any law imposing a tax upon severed
mineral values must reduce the levies authorized by this chapter and chapters 120B, 122A,
123A, 123B, 124A, 124D, 125A, and 127A by deleted text begin 95 percent ofdeleted text end the previous year's revenue
specified under deleted text begin this clausedeleted text end new text begin sections 298.018; 298.225; 298.24 to 298.28, except an amount
distributed under sections 298.26; 298.28, subdivision 4, paragraphs (c), clause (ii), and
(d); 298.34 to 298.39; 298.391 to 298.396; 298.405; 477A.15; and any law imposing a
tax upon severed mineral values
new text end .

(3) The amount of any voter approved referendum, facilities down payment, and
debt levies shall not be reduced by more than 50 percent under this subdivision. In
administering this paragraph, the commissioner shall first reduce the nonvoter approved
levies of a district; then, if any payments, severed mineral value tax revenue or recognized
revenue under paragraph (2) remains, the commissioner shall reduce any voter approved
referendum levies authorized under section 126C.17; then, if any payments, severed
mineral value tax revenue or recognized revenue under paragraph (2) remains, the
commissioner shall reduce any voter approved facilities down payment levies authorized
under section 123B.63 and then, if any payments, severed mineral value tax revenue or
recognized revenue under paragraph (2) remains, the commissioner shall reduce any
voter approved debt levies.

(4) Before computing the reduction pursuant to this subdivision of the health and
safety levy authorized by sections 123B.57 and 126C.40, subdivision 5, the commissioner
shall ascertain from each affected school district the amount it proposes to levy under
each section or subdivision. The reduction shall be computed on the basis of the amount
so ascertained.

(5) To the extent the levy reduction calculated under paragraph (2) exceeds the
limitation in paragraph (3), an amount equal to the excess must be distributed from the
school district's distribution under sections 298.225, 298.28, and 477A.15 in the following
year to the cities and townships within the school district in the proportion that their
taxable net tax capacity within the school district bears to the taxable net tax capacity of
the school district for property taxes payable in the year prior to distribution. No city or
township shall receive a distribution greater than its levy for taxes payable in the year prior
to distribution. The commissioner of revenue shall certify the distributions of cities and
towns under this paragraph to the county auditor by September 30 of the year preceding
distribution. The county auditor shall reduce the proposed and final levies of cities and
towns receiving distributions by the amount of their distribution. Distributions to the cities
and towns shall be made at the times provided under section 298.27.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for levies certified in 2013 and later.
new text end

Sec. 2.

Minnesota Statutes 2011 Supplement, section 272.02, subdivision 39, is
amended to read:


Subd. 39.

Economic development; public purpose.

The holding of property by a
political subdivision of the state for later resale for economic development purposes shall
be considered a public purpose in accordance with subdivision 8 for a period not to exceed
deleted text begin ninedeleted text end new text begin tennew text end years, except that for property located in a city of 5,000 population or under that
is located outside of the metropolitan area as defined in section 473.121, subdivision 2, the
period must not exceed 15 years.

The holding of property by a political subdivision of the state for later resale (1)
which is purchased or held for housing purposes, or (2) which meets the conditions
described in section 469.174, subdivision 10, shall be considered a public purpose in
accordance with subdivision 8.

The governing body of the political subdivision which acquires property which is
subject to this subdivision shall after the purchase of the property certify to the city or
county assessor whether the property is held for economic development purposes or
housing purposes, or whether it meets the conditions of section 469.174, subdivision 10.
If the property is acquired for economic development purposes and buildings or other
improvements are constructed after acquisition of the property, and if more than one-half
of the floor space of the buildings or improvements which is available for lease to or use
by a private individual, corporation, or other entity is leased to or otherwise used by
a private individual, corporation, or other entity the provisions of this subdivision shall
not apply to the property. This subdivision shall not create an exemption from section
272.01, subdivision 2; 272.68; 273.19; or 469.040, subdivision 3; or other provision of
law providing for the taxation of or for payments in lieu of taxes for publicly held property
which is leased, loaned, or otherwise made available and used by a private person.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for assessment year 2012 and
thereafter and for taxes payable in 2013 and thereafter.
new text end

Sec. 3.

Minnesota Statutes 2010, section 273.111, is amended by adding a subdivision
to read:


new text begin Subd. 17. new text end

new text begin Appeal. new text end

new text begin If an assessor denies an application for valuation under this
section, the county board of appeal and equalization may hear an applicant's appeal of
the assessor's decision, as provided under section 274.13.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for appeals denied after June 30,
2011.
new text end

Sec. 4.

Minnesota Statutes 2010, section 275.065, subdivision 3, is amended to read:


Subd. 3.

Notice of proposed property taxes.

(a) The county auditor shall prepare
and the county treasurer shall deliver after November 10 and on or before November 24
each year, by first class mail to each taxpayer at the address listed on the county's current
year's assessment roll, a notice of proposed property taxes. Upon written request by
the taxpayer, the treasurer may send the notice in electronic form or by electronic mail
instead of on paper or by ordinary mail.

(b) The commissioner of revenue shall prescribe the form of the notice.

(c) The notice must inform taxpayers that it contains the amount of property taxes
each taxing authority proposes to collect for taxes payable the following year. In the
case of a town, or in the case of the state general tax, the final tax amount will be its
proposed tax. deleted text begin The notice must clearly statedeleted text end For each city that has a population over 500,
county, school district, regional library authority established under section 134.201, and
metropolitan taxing districts as defined in paragraph (i), new text begin the notice must state new text end the time and
place of a meeting for each taxing authority in which the budget and levy will be discussed
and public input allowed, prior to the final budget and levy determination. new text begin For each special
taxing district, the notice must: (1) list separately any levy by a special taxing district that
exceeds 25 percent of the total of all special taxing district levies; and (2) provide county
government contact information where additional information may be obtained for each
special taxing district.
new text end The taxing authorities must provide the county auditor with the
information to be included in the notice on or before the time it certifies its proposed
levy under subdivision 1. The public must be allowed to speak at that meeting, which
must occur after November 24 and must not be held before 6:00 p.m. It must provide a
telephone number for the taxing authority that taxpayers may call if they have questions
related to the notice and an address where comments will be received by mail, except that
no notice required under this section shall be interpreted as requiring the printing of a
personal telephone number or address as the contact information for a taxing authority. If
a taxing authority does not maintain public offices where telephone calls can be received
by the authority, the authority may inform the county of the lack of a public telephone
number and the county shall not list a telephone number for that taxing authority.

(d) The notice must state for each parcel:

(1) the market value of the property as determined under section 273.11, and used
for computing property taxes payable in the following year and for taxes payable in the
current year as each appears in the records of the county assessor on November 1 of the
current year; and, in the case of residential property, whether the property is classified as
homestead or nonhomestead. The notice must clearly inform taxpayers of the years to
which the market values apply and that the values are final values;

(2) the items listed below, shown separately by county, city or town, and state general
tax, net of the residential and agricultural homestead credit under section 273.1384, voter
approved school levy, other local school levy, new text begin a special taxing district levy that exceeds 25
percent of the total of all special taxing districts,
new text end and the sum of deleted text begin thedeleted text end new text begin all othernew text end special taxing
districts, and as a total of all taxing authorities:

(i) the actual tax for taxes payable in the current year; and

(ii) the proposed tax amount.

If the county levy under clause (2) includes an amount for a lake improvement
district as defined under sections 103B.501 to 103B.581, the amount attributable for that
purpose must be separately stated from the remaining county levy amount.

In the case of a town or the state general tax, the final tax shall also be its proposed
tax unless the town changes its levy at a special town meeting under section 365.52. If a
school district has certified under section 126C.17, subdivision 9, that a referendum will
be held in the school district at the November general election, the county auditor must
note next to the school district's proposed amount that a referendum is pending and that, if
approved by the voters, the tax amount may be higher than shown on the notice. In the
case of the city of Minneapolis, the levy for Minneapolis Park and Recreation shall be
listed separately from the remaining amount of the city's levy. In the case of the city of
St. Paul, the levy for the St. Paul Library Agency must be listed separately from the
remaining amount of the city's levy. In the case of Ramsey County, any amount levied
under section 134.07 may be listed separately from the remaining amount of the county's
levy. In the case of a parcel where tax increment or the fiscal disparities areawide tax
under chapter 276A or 473F applies, the proposed tax levy on the captured value or the
proposed tax levy on the tax capacity subject to the areawide tax must each be stated
separately and not included in the sum of the special taxing districts; and

(3) the increase or decrease between the total taxes payable in the current year and
the total proposed taxes, expressed as a percentage.

For purposes of this section, the amount of the tax on homesteads qualifying under
the senior citizens' property tax deferral program under chapter 290B is the total amount
of property tax before subtraction of the deferred property tax amount.

(e) The notice must clearly state that the proposed or final taxes do not include
the following:

(1) special assessments;

(2) levies approved by the voters after the date the proposed taxes are certified,
including bond referenda and school district levy referenda;

(3) a levy limit increase approved by the voters by the first Tuesday after the first
Monday in November of the levy year as provided under section 275.73;

(4) amounts necessary to pay cleanup or other costs due to a natural disaster
occurring after the date the proposed taxes are certified;

(5) amounts necessary to pay tort judgments against the taxing authority that become
final after the date the proposed taxes are certified; and

(6) the contamination tax imposed on properties which received market value
reductions for contamination.

(f) Except as provided in subdivision 7, failure of the county auditor to prepare or
the county treasurer to deliver the notice as required in this section does not invalidate the
proposed or final tax levy or the taxes payable pursuant to the tax levy.

(g) If the notice the taxpayer receives under this section lists the property as
nonhomestead, and satisfactory documentation is provided to the county assessor by the
applicable deadline, and the property qualifies for the homestead classification in that
assessment year, the assessor shall reclassify the property to homestead for taxes payable
in the following year.

(h) In the case of class 4 residential property used as a residence for lease or rental
periods of 30 days or more, the taxpayer must either:

(1) mail or deliver a copy of the notice of proposed property taxes to each tenant,
renter, or lessee; or

(2) post a copy of the notice in a conspicuous place on the premises of the property.

The notice must be mailed or posted by the taxpayer by November 27 or within
three days of receipt of the notice, whichever is later. A taxpayer may notify the county
treasurer of the address of the taxpayer, agent, caretaker, or manager of the premises to
which the notice must be mailed in order to fulfill the requirements of this paragraph.

(i) For purposes of this subdivision and subdivision 6, "metropolitan special taxing
districts" means the following taxing districts in the seven-county metropolitan area that
levy a property tax for any of the specified purposes listed below:

(1) Metropolitan Council under section 473.132, 473.167, 473.249, 473.325,
473.446, 473.521, 473.547, or 473.834;

(2) Metropolitan Airports Commission under section 473.667, 473.671, or 473.672;
and

(3) Metropolitan Mosquito Control Commission under section 473.711.

For purposes of this section, any levies made by the regional rail authorities in the
county of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter
398A shall be included with the appropriate county's levy.

(j) The governing body of a county, city, or school district may, with the consent
of the county board, include supplemental information with the statement of proposed
property taxes about the impact of state aid increases or decreases on property tax
increases or decreases and on the level of services provided in the affected jurisdiction.
This supplemental information may include information for the following year, the current
year, and for as many consecutive preceding years as deemed appropriate by the governing
body of the county, city, or school district. It may include only information regarding:

(1) the impact of inflation as measured by the implicit price deflator for state and
local government purchases;

(2) population growth and decline;

(3) state or federal government action; and

(4) other financial factors that affect the level of property taxation and local services
that the governing body of the county, city, or school district may deem appropriate to
include.

The information may be presented using tables, written narrative, and graphic
representations and may contain instruction toward further sources of information or
opportunity for comment.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for tax statements relating to taxes
payable in 2013 and thereafter.
new text end

Sec. 5.

Minnesota Statutes 2011 Supplement, section 276.04, subdivision 2, is
amended to read:


Subd. 2.

Contents of tax statements.

(a) The treasurer shall provide for the
printing of the tax statements. The commissioner of revenue shall prescribe the form of
the property tax statement and its contents. The tax statement must not state or imply
that property tax credits are paid by the state of Minnesota. The statement must contain
a tabulated statement of the dollar amount due to each taxing authority and the amount
of the state tax from the parcel of real property for which a particular tax statement is
prepared. The dollar amounts attributable to the county, the state tax, the voter approved
school tax, the other local school tax, the township or municipality, and the total of
the metropolitan special taxing districts as defined in section 275.065, subdivision 3,
paragraph (i), must be separately stated. The amounts due all other special taxing districts,
if any, may be aggregated except deleted text begin thatdeleted text end new text begin (1)new text end any levies made by the regional rail authorities
in the county of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under
chapter 398A shall be listed on a separate line directly under the appropriate county's
levynew text begin and (2) any levy by a special taxing district that exceeds 25 percent of the total of all
special taxing district levies on a tax statement must be separately stated
new text end . If the county
levy under this paragraph includes an amount for a lake improvement district as defined
under sections 103B.501 to 103B.581, the amount attributable for that purpose must be
separately stated from the remaining county levy amount. In the case of Ramsey County,
if the county levy under this paragraph includes an amount for public library service
under section 134.07, the amount attributable for that purpose may be separated from the
remaining county levy amount. The amount of the tax on homesteads qualifying under the
senior citizens' property tax deferral program under chapter 290B is the total amount of
property tax before subtraction of the deferred property tax amount. The amount of the
tax on contamination value imposed under sections 270.91 to 270.98, if any, must also
be separately stated. The dollar amounts, including the dollar amount of any special
assessments, may be rounded to the nearest even whole dollar. For purposes of this section
whole odd-numbered dollars may be adjusted to the next higher even-numbered dollar.
The amount of market value excluded under section 273.11, subdivision 16, if any, must
also be listed on the tax statement.

(b) The property tax statements for manufactured homes and sectional structures
taxed as personal property shall contain the same information that is required on the
tax statements for real property.

(c) Real and personal property tax statements must contain the following information
in the order given in this paragraph. The information must contain the current year tax
information in the right column with the corresponding information for the previous year
in a column on the left:

(1) the property's estimated market value under section 273.11, subdivision 1;

(2) the property's homestead market value exclusion under section 273.13,
subdivision 35;

(3) the property's taxable market value after reductions under sections 273.11,
subdivisions 1a and 16, and 273.13, subdivision 35;

(4) the property's gross tax, before credits;

(5) for homestead agricultural properties, the credit under section 273.1384;

(6) any credits received under sections 273.119; 273.1234 or 273.1235; 273.135;
273.1391; 273.1398, subdivision 4; 469.171; and 473H.10, except that the amount of
credit received under section 273.135 must be separately stated and identified as "taconite
tax relief"; and

(7) the net tax payable in the manner required in paragraph (a).

(d) If the county uses envelopes for mailing property tax statements and if the county
agrees, a taxing district may include a notice with the property tax statement notifying
taxpayers when the taxing district will begin its budget deliberations for the current
year, and encouraging taxpayers to attend the hearings. If the county allows notices to
be included in the envelope containing the property tax statement, and if more than
one taxing district relative to a given property decides to include a notice with the tax
statement, the county treasurer or auditor must coordinate the process and may combine
the information on a single announcement.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for tax statements relating to taxes
payable in 2013 and thereafter.
new text end

Sec. 6.

Minnesota Statutes 2010, section 298.75, is amended by adding a subdivision
to read:


new text begin Subd. 12. new text end

new text begin Tax may be imposed; Otter Tail County. new text end

new text begin (a) If Otter Tail County
does not impose a tax under this section and approves imposition of the tax under this
subdivision, the city of Vergas in Otter Tail County may impose the aggregate materials
tax under this section.
new text end

new text begin (b) For purposes of exercising the powers contained in this section, the "city" is
deemed to be the "county."
new text end

new text begin (c) All provisions in this section apply to the city of Vergas, except that all proceeds
of the tax must be retained by the city and used for the purposes described in subdivision 7.
new text end

new text begin (d) If Otter Tail County imposes an aggregate materials tax under this section, the
tax imposed by the city of Vergas under this subdivision is repealed on the effective
date of the Otter Tail County tax.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day after the governing body of
the city of Vergas and its chief clerical officer comply with Minnesota Statutes, section
645.021, subdivisions 2 and 3.
new text end

Sec. 7.

Minnesota Statutes 2010, section 477A.017, subdivision 3, is amended to read:


Subd. 3.

Conformity.

Other law to the contrary notwithstanding, in order to receive
distributions under sections 477A.011 to 477A.03, counties and cities must conform to
the standards set in subdivision 2 in making all financial reports required to be made to
the state auditor deleted text begin after June 30, 1984deleted text end new text begin by the deadline set by the state auditor. Counties and
cities that fail to submit the required information to the state auditor within 45 days of
the reporting deadline shall forfeit an amount equal to ten percent of the distributions
under sections 477A.011 to 477A.03. Counties and cities that fail to submit the required
information within 60 days of the reporting deadline shall forfeit an amount equal to 30
percent of the distributions. Counties and cities that fail to submit the required information
within 90 days of the reporting deadline shall forfeit an amount equal to 50 percent of the
distributions
new text end .

Sec. 8.

Laws 1988, chapter 645, section 3, as amended by Laws 1999, chapter 243,
article 6, section 9, Laws 2000, chapter 490, article 6, section 15, and Laws 2008, chapter
154, article 2, section 30, is amended to read:


Sec. 3. TAX; PAYMENT OF EXPENSES.

(a) The tax levied by the hospital district under Minnesota Statutes, section 447.34,
must not be levied at a rate that exceeds the amount authorized to be levied under that
section. The proceeds of the tax may be used for all purposes of the hospital district,
except as provided in paragraph (b).

(b) 0.015 percent of taxable market value of the tax in paragraph (a) may be used
deleted text begin solelydeleted text end new text begin by the Cook ambulance service and the Orr ambulance servicenew text end for the purpose of
deleted text begin capital expenditures as it relates todeleted text end new text begin :
new text end

new text begin (1)new text end ambulance acquisitions for the Cook ambulance service and the Orr ambulance
service deleted text begin and notdeleted text end new text begin ;
new text end

new text begin (2) attached and portable equipment for use in and for the ambulances; and
new text end

new text begin (3) parts and replacement parts for maintenance and repair of the ambulances.
new text end

new text begin The money may not be usednew text end for administrativenew text begin , operation, new text end or salary expenses.

new text begin (c) new text end The part of the levy referred to in paragraph (b) must be administered by the Cook
Hospital and passed on directly to the Cook area ambulance service board and the city of
Orr to be deleted text begin held in trust until funding for a new ambulance is needed by either the Cook
ambulance service or the Orr ambulance service
deleted text end new text begin used for the purposes in paragraph (b)new text end .

Sec. 9. new text begin 2011 CITY AID PENALTIES.
new text end

new text begin (a) Notwithstanding Minnesota Statutes, section 477A.017, subdivision 3, any city
that did not meet the requirements for filing calendar year 2010 financial reports with
the state auditor imposed under Minnesota Statutes, section 477A.017, subdivision 2,
shall receive its 2011 aid payment as calculated pursuant to Minnesota Statutes, section
477A.013, subdivision 11, provided that the forms are submitted to the state auditor by
March 31, 2012. The commissioner shall make payment to each qualifying city no later
than June 30, 2012.
new text end

new text begin (b) Up to $745,048 of the fiscal year 2012 appropriation for local government aid
in Minnesota Statutes, section 477A.013, subdivision 11, is available for the payment
under this section.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 10. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2010, section 270C.991, subdivision 5, new text end new text begin is repealed.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end