SF 2212

as introduced - 82nd Legislature (2001 - 2002) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to taxation; exempting a portion of homestead 
  1.3             value from taxation; reducing property tax class 
  1.4             rates; providing a tax credit for business property; 
  1.5             increasing debt service and operating referendum 
  1.6             equalization revenues; providing that the general 
  1.7             education levy is a state levy and decreasing the 
  1.8             amount of the levy; increasing aids to local 
  1.9             governments and modifying the formula for their 
  1.10            distribution; providing for assumption by the state of 
  1.11            the cost of court administration and out-of-home 
  1.12            placements; eliminating the sales tax on purchases by 
  1.13            local units of government; appropriating money; 
  1.14            amending Minnesota Statutes 2000, sections 97A.065, 
  1.15            subdivision 2; 123B.53, subdivisions 4, 5; 123B.54; 
  1.16            126C.13, subdivisions 1, 4; 126C.17, subdivisions 5, 
  1.17            6, 7, 8; 179A.101, subdivision 1; 179A.102, 
  1.18            subdivision 6; 179A.103, subdivision 1; 256.01, 
  1.19            subdivision 2; 260.765, by adding a subdivision; 
  1.20            260.771, subdivision 4; 260B.331, subdivisions 1, 2; 
  1.21            260C.331, subdivisions 1, 2; 272.02, by adding a 
  1.22            subdivision; 273.13, subdivisions 22, 23, 24, 25, 31, 
  1.23            by adding a subdivision; 273.1319; 273.1382, 
  1.24            subdivisions 1, 1b, 2; 273.1398, subdivisions 1, 4a, 
  1.25            by adding subdivisions; 273.166, subdivision 1; 
  1.26            275.02; 275.065, subdivision 1; 297A.70, subdivisions 
  1.27            1, 2, 3; 297A.991, subdivision 2; 299D.03, subdivision 
  1.28            5; 357.021, subdivision 1a; 477A.011, subdivisions 27, 
  1.29            34, by adding subdivisions; 477A.013, subdivisions 8, 
  1.30            9; 477A.03, subdivision 2, by adding a subdivision; 
  1.31            480.181, subdivision 1; 487.33, subdivision 5; 574.34, 
  1.32            subdivision 1; proposing coding for new law in 
  1.33            Minnesota Statutes, chapter 273; repealing Minnesota 
  1.34            Statutes 2000, sections 126C.13, subdivisions 1, 2, 3; 
  1.35            273.13, subdivision 24a; 273.1382, subdivision 3; 
  1.36            477A.011, subdivisions 36, 37; 477A.03, subdivision 4. 
  1.37  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.38                             ARTICLE 1
  1.39                CLASSIFICATIONS, CREDITS, EXEMPTIONS
  1.40     Section 1.  Minnesota Statutes 2000, section 272.02, is 
  1.41  amended by adding a subdivision to read: 
  2.1      Subd. 45.  [HOMESTEAD EXEMPTION.] The first $15,000 of 
  2.2   market value of a homestead classified under section 273.13, 
  2.3   subdivision 22, is exempt, provided that the amount of the 
  2.4   exemption is increased as provided in section 273.13, 
  2.5   subdivision 34. 
  2.6      [EFFECTIVE DATE.] This section is effective for taxes 
  2.7   payable in 2002 and thereafter. 
  2.8      Sec. 2.  Minnesota Statutes 2000, section 273.13, 
  2.9   subdivision 22, is amended to read: 
  2.10     Subd. 22.  [CLASS 1.] (a) Except as provided in subdivision 
  2.11  23, real estate which is residential and used for homestead 
  2.12  purposes is class 1.  The market value of class 1a property must 
  2.13  be determined based upon the value of the house, garage, and 
  2.14  land.  
  2.15     The first $76,000 $110,000 of market value of class 1a 
  2.16  property in excess of the amount exempted under section 272.02, 
  2.17  subdivision 45, has a net class rate of one percent of its 
  2.18  market value; and the market value of class 1a property that 
  2.19  exceeds $76,000 $125,000 has a class rate of 1.65 1.5 percent of 
  2.20  its market value.  
  2.21     (b) Class 1b property includes homestead real estate or 
  2.22  homestead manufactured homes used for the purposes of a 
  2.23  homestead by 
  2.24     (1) any blind person, or the blind person and the blind 
  2.25  person's spouse; or 
  2.26     (2) any person, hereinafter referred to as "veteran," who: 
  2.27     (i) served in the active military or naval service of the 
  2.28  United States; and 
  2.29     (ii) is entitled to compensation under the laws and 
  2.30  regulations of the United States for permanent and total 
  2.31  service-connected disability due to the loss, or loss of use, by 
  2.32  reason of amputation, ankylosis, progressive muscular 
  2.33  dystrophies, or paralysis, of both lower extremities, such as to 
  2.34  preclude motion without the aid of braces, crutches, canes, or a 
  2.35  wheelchair; and 
  2.36     (iii) has acquired a special housing unit with special 
  3.1   fixtures or movable facilities made necessary by the nature of 
  3.2   the veteran's disability, or the surviving spouse of the 
  3.3   deceased veteran for as long as the surviving spouse retains the 
  3.4   special housing unit as a homestead; or 
  3.5      (3) any person who: 
  3.6      (i) is permanently and totally disabled and 
  3.7      (ii) receives 90 percent or more of total household income, 
  3.8   as defined in section 290A.03, subdivision 5, from 
  3.9      (A) aid from any state as a result of that disability; or 
  3.10     (B) supplemental security income for the disabled; or 
  3.11     (C) workers' compensation based on a finding of total and 
  3.12  permanent disability; or 
  3.13     (D) social security disability, including the amount of a 
  3.14  disability insurance benefit which is converted to an old age 
  3.15  insurance benefit and any subsequent cost of living increases; 
  3.16  or 
  3.17     (E) aid under the federal Railroad Retirement Act of 1937, 
  3.18  United States Code Annotated, title 45, section 228b(a)5; or 
  3.19     (F) a pension from any local government retirement fund 
  3.20  located in the state of Minnesota as a result of that 
  3.21  disability; or 
  3.22     (G) pension, annuity, or other income paid as a result of 
  3.23  that disability from a private pension or disability plan, 
  3.24  including employer, employee, union, and insurance plans and 
  3.25     (iii) has household income as defined in section 290A.03, 
  3.26  subdivision 5, of $50,000 or less; or 
  3.27     (4) any person who is permanently and totally disabled and 
  3.28  whose household income as defined in section 290A.03, 
  3.29  subdivision 5, is 275 percent or less of the federal poverty 
  3.30  level. 
  3.31     Property is classified and assessed under clause (4) only 
  3.32  if the government agency or income-providing source certifies, 
  3.33  upon the request of the homestead occupant, that the homestead 
  3.34  occupant satisfies the disability requirements of this paragraph.
  3.35     Property is classified and assessed pursuant to clause (1) 
  3.36  only if the commissioner of economic security certifies to the 
  4.1   assessor that the homestead occupant satisfies the requirements 
  4.2   of this paragraph.  
  4.3      Permanently and totally disabled for the purpose of this 
  4.4   subdivision means a condition which is permanent in nature and 
  4.5   totally incapacitates the person from working at an occupation 
  4.6   which brings the person an income.  The first $32,000 $17,000 of 
  4.7   market value of class 1b property in excess of the amount 
  4.8   exempted under section 272.02, subdivision 45, has a net class 
  4.9   rate of .45 percent of its market value.  The remaining market 
  4.10  value of class 1b property has a net class rate using the rates 
  4.11  for class 1 or class 2a property, whichever is appropriate, of 
  4.12  similar market value.  
  4.13     (c) Class 1c property is commercial use real property that 
  4.14  abuts a lakeshore line and is devoted to temporary and seasonal 
  4.15  residential occupancy for recreational purposes but not devoted 
  4.16  to commercial purposes for more than 250 days in the year 
  4.17  preceding the year of assessment, and that includes a portion 
  4.18  used as a homestead by the owner, which includes a dwelling 
  4.19  occupied as a homestead by a shareholder of a corporation that 
  4.20  owns the resort or a partner in a partnership that owns the 
  4.21  resort, even if the title to the homestead is held by the 
  4.22  corporation or partnership.  For purposes of this clause, 
  4.23  property is devoted to a commercial purpose on a specific day if 
  4.24  any portion of the property, excluding the portion used 
  4.25  exclusively as a homestead, is used for residential occupancy 
  4.26  and a fee is charged for residential occupancy.  Class 1c 
  4.27  property has a class rate of one percent of total market value 
  4.28  with the following limitation:  the area of the property must 
  4.29  not exceed 100 feet of lakeshore footage for each cabin or 
  4.30  campsite located on the property up to a total of 800 feet and 
  4.31  500 feet in depth, measured away from the lakeshore.  If any 
  4.32  portion of the class 1c resort property is classified as class 
  4.33  4c under subdivision 25, the entire property must meet the 
  4.34  requirements of subdivision 25, paragraph (d), clause (1), to 
  4.35  qualify for class 1c treatment under this paragraph. 
  4.36     (d) Class 1d property includes structures that meet all of 
  5.1   the following criteria: 
  5.2      (1) the structure is located on property that is classified 
  5.3   as agricultural property under section 273.13, subdivision 23; 
  5.4      (2) the structure is occupied exclusively by seasonal farm 
  5.5   workers during the time when they work on that farm, and the 
  5.6   occupants are not charged rent for the privilege of occupying 
  5.7   the property, provided that use of the structure for storage of 
  5.8   farm equipment and produce does not disqualify the property from 
  5.9   classification under this paragraph; 
  5.10     (3) the structure meets all applicable health and safety 
  5.11  requirements for the appropriate season; and 
  5.12     (4) the structure is not salable as residential property 
  5.13  because it does not comply with local ordinances relating to 
  5.14  location in relation to streets or roads. 
  5.15     The market value of class 1d property has the same class 
  5.16  rates as class 1a property under paragraph (a). 
  5.17     [EFFECTIVE DATE.] This section is effective for taxes 
  5.18  payable in 2002 and thereafter. 
  5.19     Sec. 3.  Minnesota Statutes 2000, section 273.13, 
  5.20  subdivision 23, is amended to read: 
  5.21     Subd. 23.  [CLASS 2.] (a) Class 2a property is agricultural 
  5.22  land including any improvements that is homesteaded.  The market 
  5.23  value of the house and garage and immediately surrounding one 
  5.24  acre of land has the same class rates as class 1a property under 
  5.25  subdivision 22.  The value of the remaining land including 
  5.26  improvements up to $115,000 has a net class rate of 0.35 0.3 
  5.27  percent of market value.  The value of class 2a property over 
  5.28  $115,000 of market value up to and including $600,000 $750,000 
  5.29  market value has a net class rate of 0.8 0.5 percent of market 
  5.30  value.  The remaining property over $600,000 $750,000 market 
  5.31  value has a class rate of 1.20 one percent of market value. 
  5.32     (b) Class 2b property is (1) real estate, rural in 
  5.33  character and used exclusively for growing trees for timber, 
  5.34  lumber, and wood and wood products; (2) real estate that is not 
  5.35  improved with a structure and is used exclusively for growing 
  5.36  trees for timber, lumber, and wood and wood products, if the 
  6.1   owner has participated or is participating in a cost-sharing 
  6.2   program for afforestation, reforestation, or timber stand 
  6.3   improvement on that particular property, administered or 
  6.4   coordinated by the commissioner of natural resources; (3) real 
  6.5   estate that is nonhomestead agricultural land; or (4) a landing 
  6.6   area or public access area of a privately owned public use 
  6.7   airport.  Class 2b property has a net class rate of 1.20 one 
  6.8   percent of market value. 
  6.9      (c) Agricultural land as used in this section means 
  6.10  contiguous acreage of ten acres or more, used during the 
  6.11  preceding year for agricultural purposes.  "Agricultural 
  6.12  purposes" as used in this section means the raising or 
  6.13  cultivation of agricultural products or enrollment in the 
  6.14  Reinvest in Minnesota program under sections 103F.501 to 
  6.15  103F.535 or the federal Conservation Reserve Program as 
  6.16  contained in Public Law Number 99-198.  Contiguous acreage on 
  6.17  the same parcel, or contiguous acreage on an immediately 
  6.18  adjacent parcel under the same ownership, may also qualify as 
  6.19  agricultural land, but only if it is pasture, timber, waste, 
  6.20  unusable wild land, or land included in state or federal farm 
  6.21  programs.  Agricultural classification for property shall be 
  6.22  determined excluding the house, garage, and immediately 
  6.23  surrounding one acre of land, and shall not be based upon the 
  6.24  market value of any residential structures on the parcel or 
  6.25  contiguous parcels under the same ownership. 
  6.26     (d) Real estate, excluding the house, garage, and 
  6.27  immediately surrounding one acre of land, of less than ten acres 
  6.28  which is exclusively and intensively used for raising or 
  6.29  cultivating agricultural products, shall be considered as 
  6.30  agricultural land.  
  6.31     Land shall be classified as agricultural even if all or a 
  6.32  portion of the agricultural use of that property is the leasing 
  6.33  to, or use by another person for agricultural purposes. 
  6.34     Classification under this subdivision is not determinative 
  6.35  for qualifying under section 273.111. 
  6.36     The property classification under this section supersedes, 
  7.1   for property tax purposes only, any locally administered 
  7.2   agricultural policies or land use restrictions that define 
  7.3   minimum or maximum farm acreage. 
  7.4      (e) The term "agricultural products" as used in this 
  7.5   subdivision includes production for sale of:  
  7.6      (1) livestock, dairy animals, dairy products, poultry and 
  7.7   poultry products, fur-bearing animals, horticultural and nursery 
  7.8   stock described in sections 18.44 to 18.61, fruit of all kinds, 
  7.9   vegetables, forage, grains, bees, and apiary products by the 
  7.10  owner; 
  7.11     (2) fish bred for sale and consumption if the fish breeding 
  7.12  occurs on land zoned for agricultural use; 
  7.13     (3) the commercial boarding of horses if the boarding is 
  7.14  done in conjunction with raising or cultivating agricultural 
  7.15  products as defined in clause (1); 
  7.16     (4) property which is owned and operated by nonprofit 
  7.17  organizations used for equestrian activities, excluding racing; 
  7.18     (5) game birds and waterfowl bred and raised for use on a 
  7.19  shooting preserve licensed under section 97A.115; 
  7.20     (6) insects primarily bred to be used as food for animals; 
  7.21  and 
  7.22     (7) trees, grown for sale as a crop, and not sold for 
  7.23  timber, lumber, wood, or wood products. 
  7.24     (f) If a parcel used for agricultural purposes is also used 
  7.25  for commercial or industrial purposes, including but not limited 
  7.26  to:  
  7.27     (1) wholesale and retail sales; 
  7.28     (2) processing of raw agricultural products or other goods; 
  7.29     (3) warehousing or storage of processed goods; and 
  7.30     (4) office facilities for the support of the activities 
  7.31  enumerated in clauses (1), (2), and (3), 
  7.32  the assessor shall classify the part of the parcel used for 
  7.33  agricultural purposes as class 1b, 2a, or 2b, whichever is 
  7.34  appropriate, and the remainder in the class appropriate to its 
  7.35  use.  The grading, sorting, and packaging of raw agricultural 
  7.36  products for first sale is considered an agricultural purpose.  
  8.1   A greenhouse or other building where horticultural or nursery 
  8.2   products are grown that is also used for the conduct of retail 
  8.3   sales must be classified as agricultural if it is primarily used 
  8.4   for the growing of horticultural or nursery products from seed, 
  8.5   cuttings, or roots and occasionally as a showroom for the retail 
  8.6   sale of those products.  Use of a greenhouse or building only 
  8.7   for the display of already grown horticultural or nursery 
  8.8   products does not qualify as an agricultural purpose.  
  8.9      The assessor shall determine and list separately on the 
  8.10  records the market value of the homestead dwelling and the one 
  8.11  acre of land on which that dwelling is located.  If any farm 
  8.12  buildings or structures are located on this homesteaded acre of 
  8.13  land, their market value shall not be included in this separate 
  8.14  determination.  
  8.15     (g) To qualify for classification under paragraph (b), 
  8.16  clause (4), a privately owned public use airport must be 
  8.17  licensed as a public airport under section 360.018.  For 
  8.18  purposes of paragraph (b), clause (4), "landing area" means that 
  8.19  part of a privately owned public use airport properly cleared, 
  8.20  regularly maintained, and made available to the public for use 
  8.21  by aircraft and includes runways, taxiways, aprons, and sites 
  8.22  upon which are situated landing or navigational aids.  A landing 
  8.23  area also includes land underlying both the primary surface and 
  8.24  the approach surfaces that comply with all of the following:  
  8.25     (i) the land is properly cleared and regularly maintained 
  8.26  for the primary purposes of the landing, taking off, and taxiing 
  8.27  of aircraft; but that portion of the land that contains 
  8.28  facilities for servicing, repair, or maintenance of aircraft is 
  8.29  not included as a landing area; 
  8.30     (ii) the land is part of the airport property; and 
  8.31     (iii) the land is not used for commercial or residential 
  8.32  purposes. 
  8.33  The land contained in a landing area under paragraph (b), clause 
  8.34  (4), must be described and certified by the commissioner of 
  8.35  transportation.  The certification is effective until it is 
  8.36  modified, or until the airport or landing area no longer meets 
  9.1   the requirements of paragraph (b), clause (4).  For purposes of 
  9.2   paragraph (b), clause (4), "public access area" means property 
  9.3   used as an aircraft parking ramp, apron, or storage hangar, or 
  9.4   an arrival and departure building in connection with the airport.
  9.5      [EFFECTIVE DATE.] This section is effective for taxes 
  9.6   payable in 2002 and thereafter. 
  9.7      Sec. 4.  Minnesota Statutes 2000, section 273.13, 
  9.8   subdivision 24, is amended to read: 
  9.9      Subd. 24.  [CLASS 3.] (a) Commercial and industrial 
  9.10  property and utility real and personal property is class 3a.  
  9.11     (1) Except as otherwise provided, each parcel of 
  9.12  commercial, industrial, or utility real property has a class 
  9.13  rate of 2.4 1.5 percent of the first tier of market value, and 
  9.14  3.4 three percent of the remaining market value.  In the case of 
  9.15  contiguous parcels of property owned by the same person or 
  9.16  entity, only the value equal to the first-tier value of the 
  9.17  contiguous parcels qualifies for the reduced class rate, except 
  9.18  that contiguous parcels owned by the same person or entity shall 
  9.19  be eligible for the first-tier value class rate on each separate 
  9.20  business operated by the owner of the property, provided the 
  9.21  business is housed in a separate structure.  For the purposes of 
  9.22  this subdivision, the first tier means the 
  9.23  first $150,000 $200,000 of market value.  Real property owned in 
  9.24  fee by a utility for transmission line right-of-way shall be 
  9.25  classified at the class rate for the higher tier.  
  9.26     For purposes of this subdivision, parcels are considered to 
  9.27  be contiguous even if they are separated from each other by a 
  9.28  road, street, waterway, or other similar intervening type of 
  9.29  property.  Connections between parcels that consist of power 
  9.30  lines or pipelines do not cause the parcels to be contiguous.  
  9.31  Property owners who have contiguous parcels of property that 
  9.32  constitute separate businesses that may qualify for the 
  9.33  first-tier class rate shall notify the assessor by July 1, for 
  9.34  treatment beginning in the following taxes payable year.  
  9.35     (2) Personal property that is:  (i) part of an electric 
  9.36  generation, transmission, or distribution system; or (ii) part 
 10.1   of a pipeline system transporting or distributing water, gas, 
 10.2   crude oil, or petroleum products; and (iii) not described in 
 10.3   clause (3), has a class rate as provided under clause (1) for 
 10.4   the first tier of market value and the remaining market value.  
 10.5   In the case of multiple parcels in one county that are owned by 
 10.6   one person or entity, only one first tier amount is eligible for 
 10.7   the reduced rate.  
 10.8      (3) The entire market value of personal property that is:  
 10.9   (i) tools, implements, and machinery of an electric generation, 
 10.10  transmission, or distribution system; (ii) tools, implements, 
 10.11  and machinery of a pipeline system transporting or distributing 
 10.12  water, gas, crude oil, or petroleum products; or (iii) the mains 
 10.13  and pipes used in the distribution of steam or hot or chilled 
 10.14  water for heating or cooling buildings, has a class rate as 
 10.15  provided under clause (1) for the remaining market value in 
 10.16  excess of the first tier. 
 10.17     (b) Employment property defined in section 469.166, during 
 10.18  the period provided in section 469.170, shall constitute class 
 10.19  3b.  The class rates for class 3b property are determined under 
 10.20  paragraph (a). 
 10.21     (c)(1) Subject to the limitations of clause (2), structures 
 10.22  which are (i) located on property classified as class 3a, (ii) 
 10.23  constructed under an initial building permit issued after 
 10.24  January 2, 1996, (iii) located in a transit zone as defined 
 10.25  under section 473.3915, subdivision 3, (iv) located within the 
 10.26  boundaries of a school district, and (v) not primarily used for 
 10.27  retail or transient lodging purposes, shall have a class rate 
 10.28  equal to the lesser of 2.975 percent or the class rate of the 
 10.29  second tier of the commercial property rate under paragraph (a) 
 10.30  on any portion of the market value that does not qualify for the 
 10.31  first tier class rate under paragraph (a).  As used in item (v), 
 10.32  a structure is primarily used for retail or transient lodging 
 10.33  purposes if over 50 percent of its square footage is used for 
 10.34  those purposes.  A class rate equal to the lesser of 2.975 
 10.35  percent or the class rate of the second tier of the commercial 
 10.36  property class rate under paragraph (a) shall also apply to 
 11.1   improvements to existing structures that meet the requirements 
 11.2   of items (i) to (v) if the improvements are constructed under an 
 11.3   initial building permit issued after January 2, 1996, even if 
 11.4   the remainder of the structure was constructed prior to January 
 11.5   2, 1996.  For the purposes of this paragraph, a structure shall 
 11.6   be considered to be located in a transit zone if any portion of 
 11.7   the structure lies within the zone.  If any property once 
 11.8   eligible for treatment under this paragraph ceases to remain 
 11.9   eligible due to revisions in transit zone boundaries, the 
 11.10  property shall continue to receive treatment under this 
 11.11  paragraph for a period of three years. 
 11.12     (2) This clause applies to any structure qualifying for the 
 11.13  transit zone reduced class rate under clause (1) on January 2, 
 11.14  1999, or any structure meeting any of the qualification criteria 
 11.15  in item (i) and otherwise qualifying for the transit zone 
 11.16  reduced class rate under clause (1).  Such a structure continues 
 11.17  to receive the transit zone reduced class rate until the 
 11.18  occurrence of one of the events in item (ii).  Property 
 11.19  qualifying under item (i)(D), that is located outside of a city 
 11.20  of the first class, qualifies for the transit zone reduced class 
 11.21  rate as provided in that item.  Property qualifying under item 
 11.22  (i)(E) qualifies for the transit zone reduced class rate as 
 11.23  provided in that item. 
 11.24     (i) A structure qualifies for the rate in this clause if it 
 11.25  is: 
 11.26     (A) property for which a building permit was issued before 
 11.27  December 31, 1998; or 
 11.28     (B) property for which a building permit was issued before 
 11.29  June 30, 2001, if: 
 11.30     (I) at least 50 percent of the land on which the structure 
 11.31  is to be built has been acquired or is the subject of signed 
 11.32  purchase agreements or signed options as of March 15, 1998, by 
 11.33  the entity that proposes construction of the project or an 
 11.34  affiliate of the entity; 
 11.35     (II) signed agreements have been entered into with one 
 11.36  entity or with affiliated entities to lease for the account of 
 12.1   the entity or affiliated entities at least 50 percent of the 
 12.2   square footage of the structure or the owner of the structure 
 12.3   will occupy at least 50 percent of the square footage of the 
 12.4   structure; and 
 12.5      (III) one of the following requirements is met: 
 12.6      the project proposer has submitted the completed data 
 12.7   portions of an environmental assessment worksheet by December 
 12.8   31, 1998; or 
 12.9      a notice of determination of adequacy of an environmental 
 12.10  impact statement has been published by April 1, 1999; or 
 12.11     an alternative urban areawide review has been completed by 
 12.12  April 1, 1999; or 
 12.13     (C) property for which a building permit is issued before 
 12.14  July 30, 1999, if: 
 12.15     (I) at least 50 percent of the land on which the structure 
 12.16  is to be built has been acquired or is the subject of signed 
 12.17  purchase agreements as of March 31, 1998, by the entity that 
 12.18  proposes construction of the project or an affiliate of the 
 12.19  entity; 
 12.20     (II) a signed agreement has been entered into between the 
 12.21  building developer and a tenant to lease for its own account at 
 12.22  least 200,000 square feet of space in the building; 
 12.23     (III) a signed letter of intent is entered into by July 1, 
 12.24  1998, between the building developer and the tenant to lease the 
 12.25  space for its own account; and 
 12.26     (IV) the environmental review process required by state law 
 12.27  was commenced by December 31, 1998; 
 12.28     (D) property for which an irrevocable letter of credit with 
 12.29  a housing and redevelopment authority was signed before December 
 12.30  31, 1998.  The structure shall receive the transit zone reduced 
 12.31  class rate during construction and for the duration of time that 
 12.32  the original tenants remain in the building.  Any unoccupied net 
 12.33  leasable square footage that is not leased within 36 months 
 12.34  after the certificate of occupancy has been issued for the 
 12.35  building shall not be eligible to receive the reduced class 
 12.36  rate.  This reduced class rate applies only if a qualifying 
 13.1   entity continues to own the property; 
 13.2      (E) property, located in a city of the first class, and for 
 13.3   which the building permits for the excavation, the parking ramp, 
 13.4   and the office tower were issued prior to April 1, 1999, shall 
 13.5   receive the reduced class rate during construction and for the 
 13.6   first five assessment years immediately following its initial 
 13.7   occupancy provided that, when completed, at least 25 percent of 
 13.8   the net leasable square footage must be occupied by a qualifying 
 13.9   entity each year during this time period.  In order to receive 
 13.10  the reduced class rate on the structure in any subsequent 
 13.11  assessment years, at least 50 percent of the rentable square 
 13.12  footage must be occupied by a qualifying entity.  This reduced 
 13.13  class rate applies only if a qualifying entity continues to own 
 13.14  the property. 
 13.15     (ii) A structure specified by this clause, other than a 
 13.16  structure qualifying under clause (i)(D) or (E), shall continue 
 13.17  to receive the transit zone reduced class rate until the 
 13.18  occurrence of one of the following events: 
 13.19     (A) if the structure upon initial occupancy will be owner 
 13.20  occupied by the entity initially constructing the structure or 
 13.21  an affiliated entity, the structure receives the reduced class 
 13.22  rate until the structure ceases to be at least 50 percent 
 13.23  occupied by the entity or an affiliated entity, provided, if the 
 13.24  portion of the structure occupied by that entity or an affiliate 
 13.25  of the entity is less than 85 percent, the transit zone class 
 13.26  rate reduction for the portion of structure not so occupied 
 13.27  terminates upon the leasing of such space to any nonaffiliated 
 13.28  entity; or 
 13.29     (B) if the structure is leased by a single entity or 
 13.30  affiliated entity at the time of initial occupancy, the 
 13.31  structure shall receive the reduced class rate until the 
 13.32  structure ceases to be at least 50 percent occupied by the 
 13.33  entity or an affiliated entity, provided, if the portion of the 
 13.34  structure occupied by that entity or an affiliate of the entity 
 13.35  is less than 85 percent, the transit zone class rate reduction 
 13.36  for the portion of structure not so occupied shall terminate 
 14.1   upon the leasing of such space to any nonaffiliated entity; or 
 14.2      (C) if the structure meets the criteria in item (i)(C), the 
 14.3   structure shall receive the reduced class rate until the 
 14.4   expiration of the initial lease term of the applicable tenants. 
 14.5      Percentages occupied or leased shall be determined based 
 14.6   upon net leasable square footage in the structure.  The assessor 
 14.7   shall allocate the value of the structure in the same fashion as 
 14.8   provided in the general law for portions of any structure 
 14.9   receiving and not receiving the transit tax class reduction as a 
 14.10  result of this clause. 
 14.11     (3) For purposes of paragraph (c), "qualifying entity" 
 14.12  means the entity owning the property on September 1, 2000, or an 
 14.13  affiliate of an entity that owned the property on September 1, 
 14.14  2000. 
 14.15     [EFFECTIVE DATE.] This section is effective for taxes 
 14.16  payable in 2002 and thereafter. 
 14.17     Sec. 5.  Minnesota Statutes 2000, section 273.13, 
 14.18  subdivision 25, is amended to read: 
 14.19     Subd. 25.  [CLASS 4.] (a) Class 4a is includes: 
 14.20     (1) residential real estate containing four two or more 
 14.21  units and used or held for use by the owner or by the tenants or 
 14.22  lessees of the owner as a residence for rental periods of 30 
 14.23  days or more.  Class 4a also includes; 
 14.24     (2) hospitals licensed under sections 144.50 to 144.56, 
 14.25  other than hospitals exempt under section 272.02, and contiguous 
 14.26  property used for hospital purposes, without regard to whether 
 14.27  the property has been platted or subdivided.  Class 4a property 
 14.28  in a city with a population of 5,000 or less, that is (1) 
 14.29  located outside of the metropolitan area, as defined in section 
 14.30  473.121, subdivision 2, or outside any county contiguous to the 
 14.31  metropolitan area, and (2) whose city boundary is at least 15 
 14.32  miles from the boundary of any city with a population greater 
 14.33  than 5,000 has a class rate of 2.15 percent of market value.  
 14.34  All other class 4a property has a class rate of 2.4 percent of 
 14.35  market value.  For purposes of this paragraph, population has 
 14.36  the same meaning given in section 477A.011, subdivision 3. 
 15.1      (b) Class 4b includes:; 
 15.2      (1) (3) residential real estate containing less than four 
 15.4   units that does not qualify as class 4bb 4b, other than seasonal 
 15.5   residential, and recreational; 
 15.6      (2) (4) manufactured homes not classified under any other 
 15.7   provision; 
 15.8      (3) (5) a dwelling, garage, and surrounding one acre of 
 15.9   property on a nonhomestead farm classified under subdivision 23, 
 15.10  paragraph (b) containing two or three units; 
 15.11     (4) (6) unimproved property that is classified residential 
 15.12  as determined under subdivision 33.  
 15.13     Class 4b 4a property has a class rate of 1.65 1.5 percent 
 15.14  of market value.  
 15.15     (c) (b) Class 4bb 4b includes: 
 15.16     (1) nonhomestead residential real estate containing one 
 15.17  unit, other than seasonal residential, and recreational; and 
 15.18     (2) a single family dwelling, garage, and surrounding one 
 15.19  acre of property on a nonhomestead farm classified under 
 15.20  subdivision 23, paragraph (b). 
 15.21     Class 4bb 4b has a class rate of 1.2 one percent on the 
 15.22  first $76,000 $125,000 of market value and a class rate of 1.65 
 15.23  1.5 percent of its market value that exceeds $76,000 $125,000. 
 15.24     Property that has been classified as seasonal recreational 
 15.25  residential property at any time during which it has been owned 
 15.26  by the current owner or spouse of the current owner does not 
 15.27  qualify for class 4bb 4b. 
 15.28     (d) (c) Class 4c property includes: 
 15.29     (1) except as provided in subdivision 22, paragraph (c), 
 15.30  real property devoted to temporary and seasonal residential 
 15.31  occupancy for recreation purposes, including real property 
 15.32  devoted to temporary and seasonal residential occupancy for 
 15.33  recreation purposes and not devoted to commercial purposes for 
 15.34  more than 250 days in the year preceding the year of 
 15.35  assessment.  For purposes of this clause, property is devoted to 
 15.36  a commercial purpose on a specific day if any portion of the 
 15.37  property is used for residential occupancy, and a fee is charged 
 16.1   for residential occupancy.  In order for a property to be 
 16.2   classified as class 4c, seasonal recreational residential for 
 16.3   commercial purposes, at least 40 percent of the annual gross 
 16.4   lodging receipts related to the property must be from business 
 16.5   conducted during 90 consecutive days and either (i) at least 60 
 16.6   percent of all paid bookings by lodging guests during the year 
 16.7   must be for periods of at least two consecutive nights; or (ii) 
 16.8   at least 20 percent of the annual gross receipts must be from 
 16.9   charges for rental of fish houses, boats and motors, 
 16.10  snowmobiles, downhill or cross-country ski equipment, or charges 
 16.11  for marina services, launch services, and guide services, or the 
 16.12  sale of bait and fishing tackle.  For purposes of this 
 16.13  determination, a paid booking of five or more nights shall be 
 16.14  counted as two bookings.  Class 4c also includes commercial use 
 16.15  real property used exclusively for recreational purposes in 
 16.16  conjunction with class 4c property devoted to temporary and 
 16.17  seasonal residential occupancy for recreational purposes, up to 
 16.18  a total of two acres, provided the property is not devoted to 
 16.19  commercial recreational use for more than 250 days in the year 
 16.20  preceding the year of assessment and is located within two miles 
 16.21  of the class 4c property with which it is used.  Class 4c 
 16.22  property classified in this clause also includes the remainder 
 16.23  of class 1c resorts provided that the entire property including 
 16.24  that portion of the property classified as class 1c also meets 
 16.25  the requirements for class 4c under this clause; otherwise the 
 16.26  entire property is classified as class 3.  Owners of real 
 16.27  property devoted to temporary and seasonal residential occupancy 
 16.28  for recreation purposes and all or a portion of which was 
 16.29  devoted to commercial purposes for not more than 250 days in the 
 16.30  year preceding the year of assessment desiring classification as 
 16.31  class 1c or 4c, must submit a declaration to the assessor 
 16.32  designating the cabins or units occupied for 250 days or less in 
 16.33  the year preceding the year of assessment by January 15 of the 
 16.34  assessment year.  Those cabins or units and a proportionate 
 16.35  share of the land on which they are located will be designated 
 16.36  class 1c or 4c as otherwise provided.  The remainder of the 
 17.1   cabins or units and a proportionate share of the land on which 
 17.2   they are located will be designated as class 3a.  The owner of 
 17.3   property desiring designation as class 1c or 4c property must 
 17.4   provide guest registers or other records demonstrating that the 
 17.5   units for which class 1c or 4c designation is sought were not 
 17.6   occupied for more than 250 days in the year preceding the 
 17.7   assessment if so requested.  The portion of a property operated 
 17.8   as a (1) restaurant, (2) bar, (3) gift shop, and (4) other 
 17.9   nonresidential facility operated on a commercial basis not 
 17.10  directly related to temporary and seasonal residential occupancy 
 17.11  for recreation purposes shall not qualify for class 1c or 4c; 
 17.12     (2) qualified property used as a golf course if: 
 17.13     (i) it is open to the public on a daily fee basis.  It may 
 17.14  charge membership fees or dues, but a membership fee may not be 
 17.15  required in order to use the property for golfing, and its green 
 17.16  fees for golfing must be comparable to green fees typically 
 17.17  charged by municipal courses; and 
 17.18     (ii) it meets the requirements of section 273.112, 
 17.19  subdivision 3, paragraph (d). 
 17.20     A structure used as a clubhouse, restaurant, or place of 
 17.21  refreshment in conjunction with the golf course is classified as 
 17.22  class 3a property; 
 17.23     (3) real property up to a maximum of one acre of land owned 
 17.24  by a nonprofit community service oriented organization; provided 
 17.25  that the property is not used for a revenue-producing activity 
 17.26  for more than six days in the calendar year preceding the year 
 17.27  of assessment and the property is not used for residential 
 17.28  purposes on either a temporary or permanent basis.  For purposes 
 17.29  of this clause, a "nonprofit community service oriented 
 17.30  organization" means any corporation, society, association, 
 17.31  foundation, or institution organized and operated exclusively 
 17.32  for charitable, religious, fraternal, civic, or educational 
 17.33  purposes, and which is exempt from federal income taxation 
 17.34  pursuant to section 501(c)(3), (10), or (19) of the Internal 
 17.35  Revenue Code of 1986, as amended through December 31, 1990.  For 
 17.36  purposes of this clause, "revenue-producing activities" shall 
 18.1   include but not be limited to property or that portion of the 
 18.2   property that is used as an on-sale intoxicating liquor or 3.2 
 18.3   percent malt liquor establishment licensed under chapter 340A, a 
 18.4   restaurant open to the public, bowling alley, a retail store, 
 18.5   gambling conducted by organizations licensed under chapter 349, 
 18.6   an insurance business, or office or other space leased or rented 
 18.7   to a lessee who conducts a for-profit enterprise on the 
 18.8   premises.  Any portion of the property which is used for 
 18.9   revenue-producing activities for more than six days in the 
 18.10  calendar year preceding the year of assessment shall be assessed 
 18.11  as class 3a.  The use of the property for social events open 
 18.12  exclusively to members and their guests for periods of less than 
 18.13  24 hours, when an admission is not charged nor any revenues are 
 18.14  received by the organization shall not be considered a 
 18.15  revenue-producing activity; 
 18.16     (4) post-secondary student housing of not more than one 
 18.17  acre of land that is owned by a nonprofit corporation organized 
 18.18  under chapter 317A and is used exclusively by a student 
 18.19  cooperative, sorority, or fraternity for on-campus housing or 
 18.20  housing located within two miles of the border of a college 
 18.21  campus; 
 18.22     (5) manufactured home parks as defined in section 327.14, 
 18.23  subdivision 3; 
 18.24     (6) real property that is actively and exclusively devoted 
 18.25  to indoor fitness, health, social, recreational, and related 
 18.26  uses, is owned and operated by a not-for-profit corporation, and 
 18.27  is located within the metropolitan area as defined in section 
 18.28  473.121, subdivision 2; and 
 18.29     (7) a leased or privately owned noncommercial aircraft 
 18.30  storage hangar not exempt under section 272.01, subdivision 2, 
 18.31  and the land on which it is located, provided that: 
 18.32     (i) the land is on an airport owned or operated by a city, 
 18.33  town, county, metropolitan airports commission, or group 
 18.34  thereof; and 
 18.35     (ii) the land lease, or any ordinance or signed agreement 
 18.36  restricting the use of the leased premise, prohibits commercial 
 19.1   activity performed at the hangar. 
 19.2      If a hangar classified under this clause is sold after June 
 19.3   30, 2000, a bill of sale must be filed by the new owner with the 
 19.4   assessor of the county where the property is located within 60 
 19.5   days of the sale. 
 19.6      Class 4c property has a class rate of 1.65 1.5 percent of 
 19.7   market value, except that (i) each parcel of seasonal 
 19.8   residential recreational property not used for commercial 
 19.9   purposes has the same class rates as class 4bb 4b property, (ii) 
 19.10  manufactured home parks assessed under clause (5) have the same 
 19.11  class rate as class 4b 4a property, and (iii) property described 
 19.12  in paragraph (d) (c), clause (4), has the same class rate as the 
 19.13  rate applicable to the first tier of class 4bb 4b nonhomestead 
 19.14  residential real estate under paragraph (c) (b).  
 19.15     (e) (d) Class 4d property is qualifying low-income rental 
 19.16  housing certified to the assessor by the housing finance agency 
 19.17  under sections 273.126 and 462A.071.  Class 4d includes land in 
 19.18  proportion to the total market value of the building that is 
 19.19  qualifying low-income rental housing.  For all properties 
 19.20  qualifying as class 4d, the market value determined by the 
 19.21  assessor must be based on the normal approach to value using 
 19.22  normal unrestricted rents. 
 19.23     Class 4d property has a class rate of one .6 percent of 
 19.24  market value.  
 19.25     [EFFECTIVE DATE.] This section is effective for taxes 
 19.26  payable in 2002 and thereafter. 
 19.27     Sec. 6.  Minnesota Statutes 2000, section 273.13, 
 19.28  subdivision 31, is amended to read: 
 19.29     Subd. 31.  [CLASS 5.] Class 5 property includes:  
 19.30     (1) unmined iron ore and low-grade iron-bearing formations 
 19.31  as defined in section 273.14; and 
 19.32     (2) all other property not otherwise classified. 
 19.33     Class 5 property has a class rate of 3.4 three percent of 
 19.34  market value. 
 19.35     [EFFECTIVE DATE.] This section is effective for taxes 
 19.36  payable in 2002 and thereafter. 
 20.1      Sec. 7.  Minnesota Statutes 2000, section 273.13, is 
 20.2   amended by adding a subdivision to read: 
 20.3      Subd. 34.  [INFLATION ADJUSTMENT.] Beginning with the year 
 20.4   2002 assessment, for taxes payable in 2003, the commissioner of 
 20.5   revenue shall annually adjust the valuation limits specified in 
 20.6   subdivisions 22, 23, 24, and 25 and the homestead exemption 
 20.7   amount in section 272.02, subdivision 45, for inflation.  The 
 20.8   commissioner shall make the adjustments in accordance with 
 20.9   section 290.06, subdivision 2d, except that for the purposes of 
 20.10  this subdivision the percentage increase shall be determined 
 20.11  from the year ending on August 31, 2000, to the year ending on 
 20.12  August 31 of the year preceding the assessment year.  The 
 20.13  commissioner shall round the valuation limits to the nearest 
 20.14  $1,000.  The commissioner shall annually announce the valuation 
 20.15  limits at the time specified in section 290.06 for the 
 20.16  succeeding assessment year.  The determination of the 
 20.17  commissioner under this subdivision is not a rule under the 
 20.18  Administrative Procedure Act. 
 20.19     [EFFECTIVE DATE.] This section is effective for taxes 
 20.20  payable in 2002 and thereafter. 
 20.21     Sec. 8.  Minnesota Statutes 2000, section 273.1319, is 
 20.22  amended to read: 
 20.23     273.1319 [SINGLE FAMILY HOUSING; NONCOMPLIANCE; MINNEAPOLIS 
 20.24  AND ST. PAUL.] 
 20.25     (a) If the city determines that a residential rental 
 20.26  property classified as class 4bb 4b under section 273.13, 
 20.27  subdivision 25, is not in compliance with the city's applicable 
 20.28  rental licensing requirements and housing codes, the city shall 
 20.29  notify the property owner of the specific items that are not in 
 20.30  compliance.  The owner has 60 days to correct the noncompliance 
 20.31  items identified by the city.  If they have not been corrected 
 20.32  within the 60-day time period to the satisfaction of the city, 
 20.33  the city shall notify the assessor that the property is out of 
 20.34  compliance and is no longer eligible for the class 4bb property 
 20.35  classification.  Notwithstanding any other provision of law, the 
 20.36  assessor shall reclassify the property for the current 
 21.1   assessment year, for taxes payable in the following year as 
 21.2   class 4b 4a property.  The assessor shall notify the property 
 21.3   owner of the action. 
 21.4      (b) This section applies only to property located in the 
 21.5   cities of Minneapolis and St. Paul. 
 21.6      (c) This section is effective for each of the cities of 
 21.7   Minneapolis and St. Paul upon compliance with section 645.021, 
 21.8   subdivision 3, by the governing body of the city. 
 21.9      [EFFECTIVE DATE.] This section is effective for taxes 
 21.10  payable in 2002 and thereafter. 
 21.11     Sec. 9.  [273.1384] [BUSINESS PROPERTY TAX CREDIT.] 
 21.12     Subdivision 1.  [ELIGIBILITY; COMPUTATION.] Commercial and 
 21.13  industrial property classified under section 273.13, subdivision 
 21.14  24, is eligible for a state paid property tax credit that is 
 21.15  equal to the sum of: 
 21.16     (1) 50 percent of the tax that exceeds 2.5 percent of the 
 21.17  first $200,000 of market value; plus 
 21.18     (2) 50 percent of the tax that exceeds five percent of the 
 21.19  total market value of the property. 
 21.20     Personal property of an electric utility does not qualify 
 21.21  for the credit under this section.  
 21.22     The county auditor shall annually certify to the 
 21.23  commissioner of revenue the amount of credits payable under this 
 21.24  section. 
 21.25     Subd. 2.  [REIMBURSEMENT TO TAXING AUTHORITIES.] The 
 21.26  reimbursements must be paid to local governments other than 
 21.27  school districts at the times provided in section 477A.015 for 
 21.28  payment of local government aid to taxing jurisdictions.  The 
 21.29  reimbursements to school districts must be certified to the 
 21.30  commissioner of children, families, and learning and paid under 
 21.31  section 273.1392. 
 21.32     Subd. 3.  [APPROPRIATION.] There is annually appropriated 
 21.33  from the general fund to the commissioners of revenue and 
 21.34  children, families, and learning the amounts necessary to 
 21.35  replace the revenue lost to local units of government and school 
 21.36  districts as a result of the reduction in property taxes 
 22.1   provided in this section. 
 22.2      [EFFECTIVE DATE.] This section is effective for taxes 
 22.3   payable in 2002 and thereafter. 
 22.4      Sec. 10.  Minnesota Statutes 2000, section 273.166, 
 22.5   subdivision 1, is amended to read: 
 22.6      Subdivision 1.  [DEFINITIONS.] (a) "Current local tax rate" 
 22.7   has the meaning given it in section 273.1398, subdivision 1.  
 22.8      (b) "Growth adjustment factor" means the growth adjustment 
 22.9   factor used in the calculation of homestead and agricultural 
 22.10  credit aid for the payable year in which the manufactured home 
 22.11  homestead and agricultural credit aid is payable.  
 22.12     (c) "Net tax capacity" means the product of (1) the 
 22.13  appropriate net class rates for the year in which the aid is 
 22.14  payable, except that for aids payable in 1993 the class rate 
 22.15  applicable to class 4a shall be 3.5 percent; and the class rate 
 22.16  applicable to class 4b shall be 2.65 percent; and for aid 
 22.17  payable in 1994 the class rate applicable to class 4b shall be 
 22.18  2.4 percent, and (2) estimated market values of manufactured 
 22.19  homes assessed under section 273.125 for the assessment one year 
 22.20  prior to that in which the aid is payable.  "Total net tax 
 22.21  capacity" means the net tax capacities for all manufactured 
 22.22  homes within the taxing district assessed under section 
 22.23  273.125.  Net tax capacity cannot be less than zero.  
 22.24     (d) "Net tax capacity adjustment" means (1) the total 
 22.25  previous net tax capacity minus the total net tax capacity, 
 22.26  multiplied by (2) the taxing district's current local tax rate.  
 22.27  The net tax capacity adjustment cannot be less than zero.  
 22.28     (e) "Previous net tax capacity" means the product of the 
 22.29  appropriate net class rates for the year previous to the year in 
 22.30  which the aid is payable, and estimated market values of 
 22.31  manufactured homes assessed under section 273.125 for the 
 22.32  assessment one year prior to that in which the aid is payable.  
 22.33  "Total previous net tax capacity" means the previous net tax 
 22.34  capacities for all manufactured homes within the taxing district 
 22.35  assessed under section 273.125.  Previous net tax capacity 
 22.36  cannot be less than zero.  
 23.1      [EFFECTIVE DATE.] This section is effective for taxes 
 23.2   payable in 2002 and thereafter. 
 23.3      Sec. 11.  [REPEALER.] 
 23.4      Minnesota Statutes 2000, section 273.13, subdivision 24a, 
 23.5   is repealed. 
 23.6      [EFFECTIVE DATE.] This section is effective for taxes 
 23.7   payable in 2002 and thereafter. 
 23.8                              ARTICLE 2
 23.9                          EDUCATION FINANCE
 23.10     Section 1.  Minnesota Statutes 2000, section 123B.53, 
 23.11  subdivision 4, is amended to read: 
 23.12     Subd. 4.  [DEBT SERVICE EQUALIZATION REVENUE.] (a) The debt 
 23.13  service equalization revenue of a district equals the sum of the 
 23.14  first tier debt service equalization revenue and the second tier 
 23.15  debt service equalization revenue. 
 23.16     (b) The first tier debt service equalization revenue of a 
 23.17  district equals the greater of zero or the eligible debt service 
 23.18  revenue minus the amount raised by a levy of 12 percent times 
 23.19  the adjusted net tax capacity of the district minus the second 
 23.20  tier debt service equalization revenue of the district. 
 23.21     (c) The second tier debt service equalization revenue of a 
 23.22  district equals the greater of zero or the eligible debt service 
 23.23  revenue minus the amount raised by a levy of 20 percent times 
 23.24  the adjusted net tax capacity of the district. 
 23.25     Sec. 2.  Minnesota Statutes 2000, section 123B.53, 
 23.26  subdivision 5, is amended to read: 
 23.27     Subd. 5.  [EQUALIZED DEBT SERVICE LEVY.] To obtain debt 
 23.28  service equalization revenue, a district must levy an amount not 
 23.29  to exceed the district's debt service equalization revenue (a) 
 23.30  The equalized debt service levy of a district equals the sum of 
 23.31  the first tier equalized debt service levy and the second tier 
 23.32  equalized debt service levy. 
 23.33     (b) A district's first tier equalized debt service levy 
 23.34  equals the district's first tier debt service equalization 
 23.35  revenue times the lesser of one or the ratio of: 
 23.36     (1) the quotient derived by dividing the adjusted net tax 
 24.1   capacity of the district for the year before the year the levy 
 24.2   is certified by the adjusted pupil units in the district for the 
 24.3   school year ending in the year prior to the year the levy is 
 24.4   certified; to 
 24.5      (2) $4,000 $5,000. 
 24.6      (c) A district's second tier equalized debt service levy 
 24.7   equals the district's second tier debt service equalization 
 24.8   revenue times the lesser of one or the ratio of: 
 24.9      (1) the quotient derived by dividing the adjusted net tax 
 24.10  capacity of the district for the year before the year the levy 
 24.11  is certified by the adjusted pupil units in the district for the 
 24.12  school year ending in the year prior to the year the levy is 
 24.13  certified; to 
 24.14     (2) $10,000. 
 24.15     Sec. 3.  Minnesota Statutes 2000, section 123B.54, is 
 24.16  amended to read: 
 24.17     123B.54 [DEBT SERVICE APPROPRIATION.] 
 24.18     (a) $33,141,000 in fiscal year 2000, $29,400,000 in fiscal 
 24.19  year 2001, $26,934,000 $....... in fiscal year 2002, 2004 
 24.20  and $24,540,000 $....... in fiscal year 2003 2005 and each year 
 24.21  thereafter is appropriated from the general fund to the 
 24.22  commissioner of children, families, and learning for payment of 
 24.23  debt service equalization aid under section 123B.53.  
 24.24     (b) The appropriations in paragraph (a) must be reduced by 
 24.25  the amount of any money specifically appropriated for the same 
 24.26  purpose in any year from any state fund. 
 24.27     Sec. 4.  Minnesota Statutes 2000, section 126C.13, 
 24.28  subdivision 1, is amended to read: 
 24.29     Subdivision 1.  [GENERAL EDUCATION TAX RATE.] The 
 24.30  commissioner must establish the general education tax rate by 
 24.31  July 1 of each year for levies payable in the following year.  
 24.32  The general education tax capacity rate must be a rate, rounded 
 24.33  up to the nearest hundredth of a percent, that, when applied to 
 24.34  the adjusted net tax capacity for all districts, raises the 
 24.35  amount specified in this subdivision.  The general education tax 
 24.36  rate must be is the rate that raises $1,330,000,000 
 25.1   $1,240,000,000 for fiscal year 2001, 2003 and later fiscal 
 25.2   years.  The general education tax rate may not be changed due to 
 25.3   changes or corrections made to a district's adjusted net tax 
 25.4   capacity after the tax rate has been established.  
 25.5      [EFFECTIVE DATE.] This section is effective for taxes 
 25.6   payable in 2002 and thereafter. 
 25.7      Sec. 5.  Minnesota Statutes 2000, section 126C.13, 
 25.8   subdivision 4, is amended to read: 
 25.9      Subd. 4.  [GENERAL EDUCATION AID.] A district's general 
 25.10  education aid is the sum of the following amounts:  
 25.11     (1) the product of (i) the difference between the general 
 25.12  education revenue, excluding transition revenue and supplemental 
 25.13  revenue, and the general education levy, times (ii) the ratio of 
 25.14  the actual amount levied to the permitted levy; 
 25.15     (2) transition aid according to section 126C.10, 
 25.16  subdivision 22; 
 25.17     (3) supplemental aid according to section 127A.49; 
 25.18     (4) shared time aid according to section 126C.01, 
 25.19  subdivision 7; and 
 25.20     (5) referendum aid according to section 126C.17. 
 25.21     [EFFECTIVE DATE.] This section is effective for taxes 
 25.22  payable in 2002 and thereafter.  
 25.23     Sec. 6.  Minnesota Statutes 2000, section 126C.17, 
 25.24  subdivision 5, is amended to read: 
 25.25     Subd. 5.  [REFERENDUM EQUALIZATION REVENUE.] (a) For fiscal 
 25.26  year 2002, a district's referendum equalization revenue equals 
 25.27  the referendum equalization allowance lesser of the district's 
 25.28  referendum allowance under subdivision 1 or $415 times the 
 25.29  district's resident marginal cost pupil units for that 
 25.30  year.  For fiscal year 2003 and later, a district's referendum 
 25.31  equalization revenue equals the sum of the first tier referendum 
 25.32  equalization revenue and the second tier referendum equalization 
 25.33  revenue.  
 25.34     (b) The A district's first tier referendum equalization 
 25.35  revenue equals the district's first tier referendum equalization 
 25.36  allowance times the district's resident marginal cost pupil 
 26.1   units for that year. 
 26.2      (c) A district's first tier referendum equalization 
 26.3   allowance equals $350 for fiscal year 2000 and $415 for fiscal 
 26.4   year 2001 and later. 
 26.5      (c) Referendum equalization revenue must not exceed a 
 26.6   district's total referendum revenue for that year the lesser of 
 26.7   the district's referendum allowance under subdivision 1 or $600. 
 26.8      (d) A district's second tier referendum equalization 
 26.9   allowance equals the lesser of the district's referendum 
 26.10  allowance under subdivision 1 or $900 minus the district's first 
 26.11  tier referendum equalization allowance. 
 26.12     [EFFECTIVE DATE.] This section is effective for fiscal year 
 26.13  2002 and thereafter. 
 26.14     Sec. 7.  Minnesota Statutes 2000, section 126C.17, 
 26.15  subdivision 6, is amended to read: 
 26.16     Subd. 6.  [REFERENDUM EQUALIZATION LEVY.] (a) A district's 
 26.17  referendum equalization levy for a referendum levied against the 
 26.18  referendum market value of all taxable property as defined in 
 26.19  section 126C.01, subdivision 3 fiscal year 2002, equals the 
 26.20  district's referendum equalization revenue times the lesser of 
 26.21  one or the ratio of the district's referendum market value per 
 26.22  resident marginal cost pupil unit to $476,000. 
 26.23     (b) For fiscal year 2003 and later, a district's referendum 
 26.24  equalization levy for a referendum levied against the net tax 
 26.25  capacity of all taxable property equals the district's 
 26.26  referendum equalization revenue times the lesser of one or the 
 26.27  ratio of the district's adjusted net tax capacity per resident 
 26.28  marginal cost pupil unit to $8,404 equals the sum of the first 
 26.29  tier referendum equalization levy and the second tier referendum 
 26.30  equalization levy. 
 26.31     (c) A district's first tier referendum equalization levy 
 26.32  equals the district's first tier referendum equalization revenue 
 26.33  times the lesser of one or the ratio of the district's adjusted 
 26.34  residential assessed value per resident marginal cost pupil unit 
 26.35  to $6,400. 
 26.36     (d) A district's second tier referendum equalization levy 
 27.1   equals the district's second tier revenue times the lesser of 
 27.2   one or the ratio of the district's adjusted residential assessed 
 27.3   value per resident marginal cost pupil unit to $4,265. 
 27.4      [EFFECTIVE DATE.] This section is effective for fiscal year 
 27.5   2002 and thereafter. 
 27.6      Sec. 8.  Minnesota Statutes 2000, section 126C.17, 
 27.7   subdivision 7, is amended to read: 
 27.8      Subd. 7.  [REFERENDUM EQUALIZATION AID.] (a) A district's 
 27.9   referendum equalization aid equals the difference between its 
 27.10  referendum equalization revenue and levy. 
 27.11     (b) If a district's actual levy for first or second tier 
 27.12  referendum equalization revenue is less than its maximum levy 
 27.13  limit for that tier, aid for that tier shall be proportionately 
 27.14  reduced. 
 27.15     [EFFECTIVE DATE.] This section is effective for fiscal year 
 27.16  2003 and thereafter. 
 27.17     Sec. 9.  Minnesota Statutes 2000, section 126C.17, 
 27.18  subdivision 8, is amended to read: 
 27.19     Subd. 8.  [UNEQUALIZED REFERENDUM LEVY.] Each year, a 
 27.20  district may levy an amount equal to the difference between its 
 27.21  total referendum revenue according to subdivision 5 4 and its 
 27.22  equalized referendum aid and levy according to subdivisions 6 
 27.23  and 7 referendum equalization revenue according to subdivision 5.
 27.24     [EFFECTIVE DATE.] This section is effective for taxes 
 27.25  payable in 2002 and thereafter. 
 27.26     Sec. 10.  Minnesota Statutes 2000, section 273.1382, 
 27.27  subdivision 1, is amended to read: 
 27.28     Subdivision 1.  [EDUCATION CREDIT TAX RATE.] Each year, the 
 27.29  respective county auditors shall determine the initial tax rate 
 27.30  for each school district for the general education levy 
 27.31  certified under section 126C.13, subdivision 2 or 3.  That rate 
 27.32  plus the school district's education homestead credit tax rate 
 27.33  adjustment under section 275.08, subdivision 1e, shall be The 
 27.34  general education credit tax rate for the district is the rate 
 27.35  certified under section 275.02, subdivision 1.  
 27.36     [EFFECTIVE DATE.] This section is effective for taxes 
 28.1   payable in 2002 and subsequent years.  
 28.2      Sec. 11.  Minnesota Statutes 2000, section 273.1382, 
 28.3   subdivision 1b, is amended to read: 
 28.4      Subd. 1b.  [EDUCATION AGRICULTURAL CREDIT.] Property 
 28.5   classified as class 2a agricultural homestead or class 2b 
 28.6   agricultural nonhomestead or timberland is eligible for 
 28.7   education agricultural credit.  The credit is equal to 70 the 
 28.8   sum of 75 percent, in the case of agricultural homestead 
 28.9   property up to $600,000 in market value, or 63 percent, in the 
 28.10  case of all other agricultural property or timberland, of the 
 28.11  property's net tax capacity times the education credit tax rate 
 28.12  determined in subdivision 1, plus 33.3 percent of the property's 
 28.13  net tax capacity times the total school district levy on the 
 28.14  property other than the levy certified under section 126C.13, 
 28.15  subdivision 2 or 3.  The portion of class 2a property consisting 
 28.16  of the house, garage, and surrounding one acre of land is not 
 28.17  eligible for the credit under this subdivision, nor does its 
 28.18  market value count towards the valuation threshold contained in 
 28.19  this subdivision. 
 28.20     [EFFECTIVE DATE.] This section is effective for taxes 
 28.21  levied in 2001, payable in 2002, and thereafter. 
 28.22     Sec. 12.  Minnesota Statutes 2000, section 273.1382, 
 28.23  subdivision 2, is amended to read: 
 28.24     Subd. 2.  [CREDIT REIMBURSEMENTS VERIFICATION.] (a) The 
 28.25  commissioner of revenue shall determine verify the tax 
 28.26  reductions allowed under this section for each taxes payable 
 28.27  year, and for each school district based upon a review of the 
 28.28  abstracts of tax lists submitted by the county auditors under 
 28.29  section 275.29, and from any other information which the 
 28.30  commissioner deems relevant.  The commissioner of revenue shall 
 28.31  generally compute the tax reductions at the unique taxing 
 28.32  jurisdiction level, however the commissioner may compute the tax 
 28.33  reductions at a higher geographic level if that would have a 
 28.34  negligible impact, or if changes in the composition of unique 
 28.35  taxing jurisdictions do not permit computation at the unique 
 28.36  taxing jurisdiction level.  The commissioner's determinations 
 29.1   under this paragraph are not rules. 
 29.2      (b) The commissioner of revenue shall certify the total of 
 29.3   the tax reductions granted under this section for each taxes 
 29.4   payable year within each school district to the commissioner of 
 29.5   children, families, and learning after July 1 and on or before 
 29.6   August 1 of the taxes payable year.  The commissioner of 
 29.7   children, families, and learning shall reimburse each affected 
 29.8   school district for the amount of the property tax reductions 
 29.9   allowed under this section as provided in section 273.1392.  The 
 29.10  commissioner of children, families, and learning shall treat the 
 29.11  reimbursement payments as entitlements for the same state fiscal 
 29.12  year as certified, including with each district's initial 
 29.13  payment all amounts that would have been paid up to that date, 
 29.14  computed as if 90 percent of the annual reimbursement amount for 
 29.15  the district were being paid one-twelfth in each month of the 
 29.16  fiscal year.  
 29.17     [EFFECTIVE DATE.] This section is effective for taxes 
 29.18  payable in 2002 and subsequent years.  
 29.19     Sec. 13.  Minnesota Statutes 2000, section 275.02, is 
 29.20  amended to read: 
 29.21     275.02 [STATE LEVY, EXCEPTIONS; CERTIFICATION OF TAX RATE.] 
 29.22     Subdivision 1.  [GENERAL EDUCATION LEVY.] The For taxes 
 29.23  payable in 2002 and subsequent years, a state tax shall be 
 29.24  levied on all taxable property in the state at the rate 
 29.25  specified in section 126C.13, subdivision 1.  The rate of the 
 29.26  tax shall be certified by the state auditor to each county 
 29.27  auditor on or before November 15 annually. 
 29.28     Subd. 2.  [LEVY FOR PUBLIC DEBT.] The state levy under 
 29.29  subdivision 1 is in addition to any state levy certified by the 
 29.30  state auditor under article XI of the Minnesota Constitution.  A 
 29.31  levy certified by the state auditor under article XI shall be 
 29.32  certified by the state auditor to each county auditor by 
 29.33  November 1 for taxes payable in the following year and shall be 
 29.34  applied against the assessed value of all taxable property in 
 29.35  the state. 
 29.36     [EFFECTIVE DATE.] This section is effective for taxes 
 30.1   payable in 2002 and thereafter. 
 30.2      Sec. 14.  Minnesota Statutes 2000, section 275.065, 
 30.3   subdivision 1, is amended to read: 
 30.4      Subdivision 1.  [PROPOSED LEVY.] (a) Notwithstanding any 
 30.5   law or charter to the contrary, on or before September 15, each 
 30.6   taxing authority, other than a school district and including the 
 30.7   state for the state determined general education levy, shall 
 30.8   adopt a proposed budget and shall certify to the county auditor 
 30.9   the proposed or, in the case of a town, the final property tax 
 30.10  levy for taxes payable in the following year. 
 30.11     (b) On or before September 30, each school district shall 
 30.12  certify to the county auditor the proposed property tax levy for 
 30.13  taxes payable in the following year.  The school district shall 
 30.14  certify the proposed levy as: 
 30.15     (1) the state determined school levy amount as prescribed 
 30.16  under section 126C.13, subdivision 2; 
 30.17     (2) voter approved referendum and debt levies; and 
 30.18     (3) (2) the sum of the remaining school levies, or the 
 30.19  maximum levy limitation certified by the commissioner of 
 30.20  children, families, and learning according to section 126C.48, 
 30.21  subdivision 1, less the amounts levied under clauses 
 30.22  clause (1) and (2). 
 30.23     (c) If the board of estimate and taxation or any similar 
 30.24  board that establishes maximum tax levies for taxing 
 30.25  jurisdictions within a first class city certifies the maximum 
 30.26  property tax levies for funds under its jurisdiction by charter 
 30.27  to the county auditor by September 15, the city shall be deemed 
 30.28  to have certified its levies for those taxing jurisdictions. 
 30.29     (d) For purposes of this section, "taxing authority" 
 30.30  includes all home rule and statutory cities, towns, counties, 
 30.31  school districts, and special taxing districts as defined in 
 30.32  section 275.066.  Intermediate school districts that levy a tax 
 30.33  under chapter 124 or 136D, joint powers boards established under 
 30.34  sections 123A.44 to 123A.446, and common school districts No. 
 30.35  323, Franconia, and No. 815, Prinsburg, are also special taxing 
 30.36  districts for purposes of this section.  
 31.1      Sec. 15.  [REPEALER.] 
 31.2      Minnesota Statutes 2000, sections 126C.13, subdivisions 1, 
 31.3   2, and 3; and 273.1382, subdivision 3, are repealed.  
 31.4      [EFFECTIVE DATE.] This section is effective for taxes 
 31.5   payable in 2002 and subsequent years. 
 31.6                              ARTICLE 3
 31.7                         LOCAL GOVERNMENT AID
 31.8      Section 1.  Minnesota Statutes 2000, section 273.1398, 
 31.9   subdivision 1, is amended to read: 
 31.10     Subdivision 1.  [DEFINITIONS.] (a) In this section, the 
 31.11  terms defined in this subdivision have the meanings given them. 
 31.12     (b) "Unique taxing jurisdiction" means the geographic area 
 31.13  subject to the same set of local tax rates. 
 31.14     (c) "Previous net tax capacity" means the product of the 
 31.15  appropriate net class rates for the year previous to the year in 
 31.16  which the aid is payable, and estimated market values for the 
 31.17  assessment two years prior to that in which aid is payable.  
 31.18  "Total previous net tax capacity" means the previous net tax 
 31.19  capacities for all property within the unique taxing 
 31.20  jurisdiction.  The total previous net tax capacity shall be 
 31.21  reduced by the sum of (1) the unique taxing jurisdiction's 
 31.22  previous net tax capacity of commercial-industrial property as 
 31.23  defined in section 473F.02, subdivision 3, or 276A.01, 
 31.24  subdivision 3, multiplied by the ratio determined pursuant to 
 31.25  section 473F.08, subdivision 6, or 276A.06, subdivision 7, for 
 31.26  the municipality, as defined in section 473F.02, subdivision 8, 
 31.27  or 276A.01, subdivision 8, in which the unique taxing 
 31.28  jurisdiction is located, (2) the previous net tax capacity of 
 31.29  the captured value of tax increment financing districts as 
 31.30  defined in section 469.177, subdivision 2, and (3) the previous 
 31.31  net tax capacity of transmission lines deducted from a local 
 31.32  government's total net tax capacity under section 273.425.  
 31.33  Previous net tax capacity cannot be less than zero. 
 31.34     (d) "Equalized market values" are market values that have 
 31.35  been equalized by dividing the assessor's estimated market value 
 31.36  for the second year prior to that in which the aid is payable by 
 32.1   the assessment sales ratios determined by class in the 
 32.2   assessment sales ratio study conducted by the department of 
 32.3   revenue pursuant to section 127A.48 in the second year prior to 
 32.4   that in which the aid is payable.  The equalized market values 
 32.5   shall equal the unequalized market values divided by the 
 32.6   assessment sales ratio. 
 32.7      (e) "Equalized school levies" means the amounts levied for: 
 32.8      (1) general education under section 126C.13, subdivision 2; 
 32.9      (2) supplemental revenue under section 126C.10, subdivision 
 32.10  10; 
 32.11     (3) transition revenue under section 126C.10, subdivision 
 32.12  20; and 
 32.13     (4) referendum revenue under section 126C.17. 
 32.14     (f) "Current local tax rate" means the quotient derived by 
 32.15  dividing the taxes levied within a unique taxing jurisdiction 
 32.16  for taxes payable in the year prior to that for which aids are 
 32.17  being calculated by the total previous net tax capacity of the 
 32.18  unique taxing jurisdiction.  
 32.19     (g) For purposes of calculating and allocating homestead 
 32.20  and agricultural credit aid authorized pursuant to subdivision 2 
 32.21  and the disparity reduction aid authorized in subdivision 3, 
 32.22  "gross taxes levied on all properties," "gross taxes," or "taxes 
 32.23  levied" means the total net tax capacity based taxes levied on 
 32.24  all properties except that levied on the captured value of tax 
 32.25  increment districts as defined in section 469.177, subdivision 
 32.26  2, and that levied on the portion of commercial industrial 
 32.27  properties' assessed value or gross tax capacity, as defined in 
 32.28  section 473F.02, subdivision 3, subject to the areawide tax as 
 32.29  provided in section 473F.08, subdivision 6, in a unique taxing 
 32.30  jurisdiction.  "Gross taxes" are before any reduction for 
 32.31  disparity reduction aid but "taxes levied" are after any 
 32.32  reduction for disparity reduction aid.  Gross taxes levied or 
 32.33  taxes levied cannot be less than zero.  
 32.34     "Taxes levied" excludes equalized school levies. 
 32.35     (h) "Household adjustment factor" means the number of 
 32.36  households, for the year most recently determined as of July 1 
 33.1   in the aid calculation year, divided by the number of households 
 33.2   for the year immediately preceding the year for which the number 
 33.3   of households has most recently been determined as of July 1.  
 33.4   The household adjustment factor cannot be less than one.  
 33.5      (i) "Growth adjustment factor" means the household 
 33.6   adjustment factor in the case of counties.  In the case of 
 33.7   cities, towns, school districts, and special taxing districts, 
 33.8   the growth adjustment factor equals one.  The growth adjustment 
 33.9   factor cannot be less than one.  
 33.10     (j) "Homestead and agricultural credit base" means the 
 33.11  previous year's certified homestead and agricultural credit aid 
 33.12  determined under subdivision 2 less any permanent aid reduction 
 33.13  in the previous year to homestead and agricultural credit 
 33.14  aid and plus any permanent increase in the previous year to 
 33.15  homestead and agricultural credit aid.  
 33.16     (k) "Net tax capacity adjustment" means (1) the tax base 
 33.17  differential defined in subdivision 1a, multiplied by (2) the 
 33.18  unique taxing jurisdiction's current local tax rate.  The net 
 33.19  tax capacity adjustment cannot be less than zero. 
 33.20     (l) "Fiscal disparity adjustment" means a taxing 
 33.21  jurisdiction's fiscal disparity distribution levy under section 
 33.22  473F.08, subdivision 3, clause (a), or 276A.06, subdivision 3, 
 33.23  clause (a), for taxes payable in the year prior to that for 
 33.24  which aids are being calculated, multiplied by the ratio of the 
 33.25  tax base differential percent referenced in subdivision 1a for 
 33.26  the highest class rate for class 3 property for taxes payable in 
 33.27  the year prior to that for which aids are being calculated to 
 33.28  the highest class rate for class 3 property for taxes payable in 
 33.29  the second prior year to that for which aids are being 
 33.30  calculated.  In the case of school districts, the fiscal 
 33.31  disparity distribution levy shall exclude that part of the levy 
 33.32  attributable to equalized school levies. 
 33.33     [EFFECTIVE DATE.] This section is effective for aids 
 33.34  payable in calendar year 2002 and thereafter. 
 33.35     Sec. 2.  Minnesota Statutes 2000, section 273.1398, is 
 33.36  amended by adding a subdivision to read: 
 34.1      Subd. 4b.  [AID ADJUSTMENT FOR 2002 CITY LOCAL GOVERNMENT 
 34.2   AID INCREASES.] Payments to a city under subdivision 2 or 
 34.3   section 273.166 for calendar year 2002 are equal to (1) payments 
 34.4   under those sections in calendar year 2001 minus (2) the 
 34.5   difference between the amount the city is certified to receive 
 34.6   in aid under sections 477A.011 to 477A.014 in calendar year 2002 
 34.7   and what the city would have received in calendar year 2002 
 34.8   under the formula in Minnesota Statutes 2000, sections 477A.011 
 34.9   to 477A.014.  The amount of homestead and agricultural credit 
 34.10  aid remaining after the offset may not be less than zero. 
 34.11     [EFFECTIVE DATE.] This section is effective for aids 
 34.12  payable in calendar year 2002. 
 34.13     Sec. 3.  Minnesota Statutes 2000, section 273.1398, is 
 34.14  amended by adding a subdivision to read: 
 34.15     Subd. 4c.  [ADJUSTMENT FOR LOW-INCOME HOUSING 
 34.16  AID.] Payments to a city under subdivision 2 or section 273.166 
 34.17  for calendar year 2004 are permanently increased by the amount 
 34.18  certified to be paid to it in 2003 under section 477A.06. 
 34.19     [EFFECTIVE DATE.] This section is effective for aids 
 34.20  payable in calendar year 2004. 
 34.21     Sec. 4.  Minnesota Statutes 2000, section 273.1398, is 
 34.22  amended by adding a subdivision to read: 
 34.23     Subd. 4d.  [ADJUSTMENT FOR SELECTED CITIES.] Payments to a 
 34.24  city under subdivision 2 or section 273.166 shall be decreased 
 34.25  by $450,000 in calendar year 2009 if the city had an increased 
 34.26  city aid base for local government aid purposes in 2001 under 
 34.27  section 477A.01, subdivision 36, paragraph (f). 
 34.28     [EFFECTIVE DATE.] This section is effective for aids 
 34.29  payable in calendar years 2002 to 2008. 
 34.30     Sec. 5.  Minnesota Statutes 2000, section 477A.011, 
 34.31  subdivision 27, is amended to read: 
 34.32     Subd. 27.  [REVENUE BASE.] "Revenue base" means the amount 
 34.33  levied for taxes payable in the previous year, including the 
 34.34  levy on the fiscal disparity distribution under section 276A.06, 
 34.35  subdivision 3, paragraph (a), or 473F.08, subdivision 3, 
 34.36  paragraph (a), and before reduction for the homestead and 
 35.1   agricultural credit aid under section 273.1398, subdivision 2, 
 35.2   equalization aid under section 477A.013, subdivision 5, and 
 35.3   disparity reduction aid under section 273.1398, subdivision 3; 
 35.4   plus the originally certified local government aid in the 
 35.5   previous year under sections 477A.011 and 477A.013; the local 
 35.6   performance aid in the previous year under section 477A.05; the 
 35.7   homestead and agricultural credit aid in the previous year under 
 35.8   section 273.1398, subdivision 2; and the taconite aids received 
 35.9   in the previous year under sections 298.28 and 298.282. 
 35.10     [EFFECTIVE DATE.] This section is effective for aids 
 35.11  payable in calendar year 2002 and thereafter. 
 35.12     Sec. 6.  Minnesota Statutes 2000, section 477A.011, is 
 35.13  amended by adding a subdivision to read: 
 35.14     Subd. 27a.  [REVENUE BASE PER CAPITA.] "Revenue base per 
 35.15  capita" means a city's revenue base divided by the city's 
 35.16  population for two calendar years prior to the payable year of 
 35.17  the aids and levies used in calculating the revenue base. 
 35.18     [EFFECTIVE DATE.] This section is effective for aids 
 35.19  payable in calendar year 2002 and thereafter. 
 35.20     Sec. 7.  Minnesota Statutes 2000, section 477A.011, is 
 35.21  amended by adding a subdivision to read: 
 35.22     Subd. 27b.  [AVERAGE SMALL CITY PER CAPITA REVENUE 
 35.23  BASE.] "Average small city per capita revenue base" means the 
 35.24  sum of the revenue base per capita for all cities with a 
 35.25  population of less than 2,500 divided by the number of cities 
 35.26  with a population less than 2,500. 
 35.27     [EFFECTIVE DATE.] This section is effective for aids 
 35.28  payable in calendar year 2002 and thereafter. 
 35.29     Sec. 8.  Minnesota Statutes 2000, section 477A.011, 
 35.30  subdivision 34, is amended to read: 
 35.31     Subd. 34.  [PER CAPITA CITY REVENUE NEED.] (a) For a city 
 35.32  with a population equal to or greater than 2,500, "per capita 
 35.33  city revenue need" is the sum of (1) 3.462312 5.15088 times the 
 35.34  pre-1940 housing percentage; plus (2) 2.093826 1.94802 times the 
 35.35  commercial industrial percentage; plus (3) 6.862552 15.81637 
 35.36  times the population decline percentage; plus (4) .00026 times 
 36.1   the city population 4.72462 times the single-parent percentage; 
 36.2   plus (5) 152.0141 0.02877 times the heating degree days; minus 
 36.3   (6) 59.529. 
 36.4      (b) For a city with a population less than 2,500, "city 
 36.5   revenue need" is the sum of (1) 1.795919 times the pre-1940 
 36.6   housing percentage; plus (2) 1.562138 times the commercial 
 36.7   industrial percentage; plus (3) 4.177568 times the population 
 36.8   decline percentage; plus (4) 1.04013 times the transformed 
 36.9   population; minus (5) 107.475 "per capita city revenue need" is 
 36.10  equal to the lesser of (1) the sum of the city's revenue base 
 36.11  per capita for the four most recently available calendar years 
 36.12  divided by four, or (2) the average small city per capita 
 36.13  revenue base plus two-thirds of the amount of that city's 
 36.14  average revenue base per capita for the last four years which 
 36.15  exceeds the average small city per capita revenue base. 
 36.16     (c) The per capita city revenue need cannot be less than 
 36.17  zero. 
 36.18     (d) For calendar year 1998 and subsequent years, the city 
 36.19  revenue need for a city, as determined in paragraphs (a) to (c), 
 36.20  is multiplied by the ratio of the annual implicit price deflator 
 36.21  for government consumption expenditures and gross investment for 
 36.22  state and local governments as prepared by the United States 
 36.23  Department of Commerce, for the most recently available year to 
 36.24  the 1993 implicit price deflator for state and local government 
 36.25  purchases. 
 36.26     [EFFECTIVE DATE.] This section is effective for aids 
 36.27  payable in calendar year 2002 and thereafter. 
 36.28     Sec. 9.  Minnesota Statutes 2000, section 477A.011, is 
 36.29  amended by adding a subdivision to read: 
 36.30     Subd. 38.  [SINGLE-PARENT PERCENTAGE.] "Single parent 
 36.31  percentage" for a city is equal to 100 times the number of 
 36.32  households headed by a single parent in the city divided by the 
 36.33  total number of households for that city, as reported in the 
 36.34  most recently available federal census. 
 36.35     [EFFECTIVE DATE.] This section is effective for aids 
 36.36  payable in calendar year 2002 and thereafter. 
 37.1      Sec. 10.  Minnesota Statutes 2000, section 477A.011, is 
 37.2   amended by adding a subdivision to read: 
 37.3      Subd. 39.  [HEATING DEGREE DAYS.] "Heating degree days" for 
 37.4   a city is equal to the total number of heating degree days at 
 37.5   the closest reporting weather station for the period 1961 
 37.6   through 1990 as prepared by the state climatologist in the 
 37.7   department of natural resources.  For purposes of this 
 37.8   subdivision, "closest reporting weather station" means the 
 37.9   station closest to the city's center as measured by the city's 
 37.10  longitude and latitude as reported in the most recent federal 
 37.11  census. 
 37.12     [EFFECTIVE DATE.] This section is effective for aids 
 37.13  payable in calendar year 2002 and thereafter. 
 37.14     Sec. 11.  Minnesota Statutes 2000, section 477A.013, 
 37.15  subdivision 8, is amended to read: 
 37.16     Subd. 8.  [CITY FORMULA AID.] In calendar year 1994 2002 
 37.17  and subsequent years, the formula aid for a city is equal to the 
 37.18  need increase percentage multiplied by the difference between 
 37.19  (1) the per capita city's revenue need multiplied by its 
 37.20  population, and (2) the city's net tax capacity multiplied by 
 37.21  the a tax effort rate of 30 percent.  No city may have a formula 
 37.22  aid amount less than zero.  The need increase percentage must be 
 37.23  the same for all cities.  
 37.24     Notwithstanding the prior sentence, in 1995 only, the need 
 37.25  increase percentage for a city shall be twice the need increase 
 37.26  percentage applicable to other cities if:  
 37.27     (1) the city, in 1992 or 1993, transferred an amount from 
 37.28  governmental funds to their sewer and water fund, and 
 37.29     (2) the amount transferred exceeded their net levy for 
 37.30  taxes payable in the year in which the transfer occurred. 
 37.31     The applicable need increase percentage or percentages must 
 37.32  be calculated by the department of revenue so that the total of 
 37.33  the aid under subdivision 9 equals the total amount available 
 37.34  for aid under section 477A.03.  
 37.35     [EFFECTIVE DATE.] This section is effective for aids 
 37.36  payable in calendar year 2002 and thereafter. 
 38.1      Sec. 12.  Minnesota Statutes 2000, section 477A.013, 
 38.2   subdivision 9, is amended to read: 
 38.3      Subd. 9.  [CITY AID DISTRIBUTION.] (a) In calendar year 
 38.4   1994 and thereafter, each city shall receive an aid distribution 
 38.5   equal to the sum of (1) the city formula aid under subdivision 
 38.6   8, and (2) its city aid base 2002 and thereafter, each city 
 38.7   shall receive an aid distribution equal to its formula aid under 
 38.8   subdivision 8. 
 38.9      (b) The percentage increase for a first class city in 
 38.10  calendar year 1995 and thereafter shall not exceed the 
 38.11  percentage increase in the sum of the aid to all cities under 
 38.12  this section in the current calendar year compared to the sum of 
 38.13  the aid to all cities in the previous year. 
 38.14     (c) The total aid for any city, except a first class city, 
 38.15  shall not exceed the sum of (1) ten percent of the city's net 
 38.16  levy for the year prior to the aid distribution plus (2) its 
 38.17  total aid in the previous year before any increases or decreases 
 38.18  under sections 16A.711, subdivision 5, and 477A.0132. 
 38.19     (d) Notwithstanding paragraph (c), in 1995 only, for cities 
 38.20  which in 1992 or 1993 transferred an amount from governmental 
 38.21  funds to their sewer and water fund in an amount greater than 
 38.22  their net levy for taxes payable in the year in which the 
 38.23  transfer occurred, the total aid shall not exceed the sum of (1) 
 38.24  20 percent of the city's net levy for the year prior to the aid 
 38.25  distribution plus (2) its total aid in the previous year before 
 38.26  any increases or decreases under sections 16A.711, subdivision 
 38.27  5, and 477A.0132 The total aid under this section and under 
 38.28  sections 298.28 and 298.282 for any city must not exceed 90 
 38.29  percent of the city's revenue base in 2002. 
 38.30     [EFFECTIVE DATE.] This section is effective for aids 
 38.31  payable in calendar year 2002 and thereafter. 
 38.32     Sec. 13.  Minnesota Statutes 2000, section 477A.03, 
 38.33  subdivision 2, is amended to read: 
 38.34     Subd. 2.  [ANNUAL APPROPRIATION.] (a) A sum sufficient to 
 38.35  discharge the duties imposed by sections 477A.011 to 477A.014 is 
 38.36  annually appropriated from the general fund to the commissioner 
 39.1   of revenue.  
 39.2      (b) Aid payments to counties under section 477A.0121 are 
 39.3   limited to $20,265,000 in 1996.  Aid payments to counties under 
 39.4   section 477A.0121 are limited to $27,571,625 in 1997.  For aid 
 39.5   payable in 1998 and thereafter, the total aids paid under 
 39.6   section 477A.0121 are the amounts certified to be paid in the 
 39.7   previous year, adjusted for inflation as provided under 
 39.8   subdivision 3. 
 39.9      (c)(i) For aids payable in 1998 and thereafter, the total 
 39.10  aids paid to counties under section 477A.0122 are the amounts 
 39.11  certified to be paid in the previous year, adjusted for 
 39.12  inflation as provided under subdivision 3. 
 39.13     (ii) Aid payments to counties under section 477A.0122 in 
 39.14  2000 are further increased by an additional $20,000,000 in 2000. 
 39.15     (d) Aid payments to cities in 1999 under section 477A.013, 
 39.16  subdivision 9, are limited to $380,565,489.  For aids payable in 
 39.17  2000, the total aids paid under section 477A.013, subdivision 9, 
 39.18  are the amounts certified to be paid in the previous year, 
 39.19  adjusted for inflation as provided in subdivision 3, and 
 39.20  increased by the amount necessary to effectuate Laws 1999, 
 39.21  chapter 243, article 5, section 48, paragraph (b).  For aids 
 39.22  payable in 2001 through 2003, the total aids paid under section 
 39.23  477A.013, subdivision 9, are the amounts certified to be paid in 
 39.24  the previous year, adjusted for inflation as provided under 
 39.25  subdivision 3 5.  For aids payable in 2004, the total aids paid 
 39.26  under section 477A.013, subdivision 9, are the amounts certified 
 39.27  to be paid in the previous year, adjusted for inflation as 
 39.28  provided under subdivision 3, and increased by the amount 
 39.29  certified to be paid in 2003 under section 477A.06.  For aids 
 39.30  payable in 2005 and thereafter, the total aids paid under 
 39.31  section 477A.013, subdivision 9, are the amounts certified to be 
 39.32  paid in the previous year, adjusted for inflation as provided 
 39.33  under subdivision 3.  The additional amount authorized under 
 39.34  subdivision 4 is not included when calculating the appropriation 
 39.35  limits under this paragraph. 
 39.36     [EFFECTIVE DATE.] This section is effective for aids 
 40.1   payable in calendar year 2002 and thereafter. 
 40.2      Sec. 14.  Minnesota Statutes 2000, section 477A.03, is 
 40.3   amended by adding a subdivision to read: 
 40.4      Subd. 5.  [CITY AID ADJUSTMENT.] In 2003 and subsequent 
 40.5   years, the total aids paid under section 477A.013, subdivision 
 40.6   9, shall be increased by an amount equal to: 
 40.7      (1) the amount certified to be paid under that section in 
 40.8   the previous year, multiplied by 
 40.9      (2) one plus the percentage increase in the estimated total 
 40.10  revenues collected under sections 290.06, subdivision 2c, and 
 40.11  290.091, and chapter 297A in the fiscal year ended June 30 of 
 40.12  the year in which the aid is to be paid compared to the revenues 
 40.13  collected in the previous fiscal year.  For purposes of this 
 40.14  subdivision, "total revenues collected" are the revenues 
 40.15  collected prior to any rebate of collected revenues to taxpayers.
 40.16     [EFFECTIVE DATE.] This section is effective for aids 
 40.17  payable in 2003 and subsequent years. 
 40.18     Sec. 15.  [REPEALER.] 
 40.19     Minnesota Statutes 2000, sections 477A.011, subdivisions 36 
 40.20  and 37; and 477A.03, subdivision 4, are repealed. 
 40.21     [EFFECTIVE DATE.] This section is effective for aids 
 40.22  payable in calendar year 2002 and thereafter. 
 40.23                             ARTICLE 4
 40.24                  STATE ASSUMPTION OF COUNTY COSTS
 40.25     Section 1.  Minnesota Statutes 2000, section 97A.065, 
 40.26  subdivision 2, is amended to read: 
 40.27     Subd. 2.  [FINES AND FORFEITED BAIL.] (a) Fines and 
 40.28  forfeited bail collected from prosecutions of violations of:  
 40.29  the game and fish laws; sections 84.091 to 84.15; sections 84.81 
 40.30  to 84.91; section 169A.20, when the violation involved an 
 40.31  off-road recreational vehicle as defined in section 169A.03, 
 40.32  subdivision 16; chapter 348; and any other law relating to wild 
 40.33  animals or aquatic vegetation, must be paid to the treasurer of 
 40.34  the county where the violation is prosecuted.  The county 
 40.35  treasurer shall submit one-half of the receipts to the 
 40.36  commissioner and credit the balance to the county general 
 41.1   revenue fund except as provided in paragraphs (b), (c), and 
 41.2   (d).  In a county in a judicial district under section 480.181, 
 41.3   subdivision 1, paragraph (b), as added in Laws 1999, chapter 
 41.4   216, article 7, section 26 or section 15, the share that would 
 41.5   otherwise go to the county under this paragraph must be 
 41.6   submitted to the state treasurer for deposit in the state 
 41.7   treasury and credited to the general fund. 
 41.8      (b) The commissioner must reimburse a county, from the game 
 41.9   and fish fund, for the cost of keeping prisoners prosecuted for 
 41.10  violations under this section if the county board, by 
 41.11  resolution, directs:  (1) the county treasurer to submit all 
 41.12  fines and forfeited bail to the commissioner; and (2) the county 
 41.13  auditor to certify and submit monthly itemized statements to the 
 41.14  commissioner.  
 41.15     (c) The county treasurer shall submit one-half of the 
 41.16  receipts collected under paragraph (a) from prosecutions of 
 41.17  violations of sections 84.81 to 84.91, and 169A.20, except 
 41.18  receipts that are surcharges imposed under section 357.021, 
 41.19  subdivision 6, to the commissioner and credit the balance to the 
 41.20  county general fund.  The commissioner shall credit these 
 41.21  receipts to the snowmobile trails and enforcement account in the 
 41.22  natural resources fund. 
 41.23     (d) The county treasurer shall indicate the amount of the 
 41.24  receipts that are surcharges imposed under section 357.021, 
 41.25  subdivision 6, and shall submit all of those receipts to the 
 41.26  state treasurer. 
 41.27     Sec. 2.  Minnesota Statutes 2000, section 179A.101, 
 41.28  subdivision 1, is amended to read: 
 41.29     Subdivision 1.  [COURT EMPLOYEE UNITS.] (a) The state court 
 41.30  administrator shall meet and negotiate with the exclusive 
 41.31  representative of each of the units specified in this section.  
 41.32  The units provided in this section are the only appropriate 
 41.33  units for court employees.  Court employees, unless otherwise 
 41.34  excluded, are included within the units which include the 
 41.35  classifications to which they are assigned for purposes of 
 41.36  compensation.  Initial assignment of classifications to 
 42.1   bargaining units shall be made by the state court administrator 
 42.2   by August 15, 1999 of the year preceding the year in which the 
 42.3   state assumes the cost of court administration in the judicial 
 42.4   district in which the bargaining unit is located.  An exclusive 
 42.5   representative may appeal the initial assignment decision of the 
 42.6   state court administrator by filing a petition with the 
 42.7   commissioner within 45 days of being certified as the exclusive 
 42.8   representative for a judicial district.  The units in this 
 42.9   subdivision are the appropriate units of court employees. 
 42.10     (b) The judicial district unit consists of clerical, 
 42.11  administrative, and technical employees of a judicial district 
 42.12  under section 480.181, subdivision 1, paragraph (b), or of two 
 42.13  or more of these districts that are represented by the same 
 42.14  employee organization or one or more subordinate bodies of the 
 42.15  same employee organization.  The judicial district unit includes 
 42.16  individuals, not otherwise excluded, whose work is typically 
 42.17  clerical or secretarial in nature, including nontechnical data 
 42.18  recording and retrieval and general office work, and 
 42.19  individuals, not otherwise excluded, whose work is not typically 
 42.20  manual and which requires specialized knowledge or skills 
 42.21  acquired through two-year academic programs or equivalent 
 42.22  experience or on-the-job training. 
 42.23     (c) The appellate courts unit consists of clerical, 
 42.24  administrative, and technical employees of the court of appeals 
 42.25  and clerical, administrative, and technical employees of the 
 42.26  supreme court.  The appellate courts unit includes individuals, 
 42.27  not otherwise excluded, whose work is typically clerical or 
 42.28  secretarial in nature, including nontechnical data recording and 
 42.29  retrieval and general office work, and individuals, not 
 42.30  otherwise excluded, whose work is not typically manual and which 
 42.31  requires specialized knowledge or skills acquired through 
 42.32  two-year academic programs or equivalent experience or 
 42.33  on-the-job training. 
 42.34     (d) The court employees professional employee unit consists 
 42.35  of professional employees, not otherwise excluded, that are 
 42.36  employed by the supreme court, the court of appeals, or a 
 43.1   judicial district under section 480.181, subdivision 1, 
 43.2   paragraph (b). 
 43.3      (e) The court employees court reporter unit consists of 
 43.4   court reporters not otherwise excluded who are employed by a 
 43.5   judicial district under section 480.181, subdivision 1, 
 43.6   paragraph (a). 
 43.7      (f) Notwithstanding any provision of this chapter or any 
 43.8   other law to the contrary, judges may appoint and remove court 
 43.9   reporters at their pleasure. 
 43.10     (g) Copies of collective bargaining agreements entered into 
 43.11  under this section must be submitted to the legislative 
 43.12  coordinating commission for the commission's information. 
 43.13     Sec. 3.  Minnesota Statutes 2000, section 179A.102, 
 43.14  subdivision 6, is amended to read: 
 43.15     Subd. 6.  [CONTRACT AND REPRESENTATION RESPONSIBILITIES.] 
 43.16  (a) Notwithstanding the provisions of section 179A.101, the 
 43.17  exclusive representatives of units of court employees certified 
 43.18  prior to the effective date of the judicial district coming 
 43.19  under section 480.181, subdivision 1, paragraph (b), remain 
 43.20  responsible for administration of their contracts and for other 
 43.21  contractual duties and have the right to dues and fair share fee 
 43.22  deduction and other contractual privileges and rights until a 
 43.23  contract is agreed upon with the state court administrator for a 
 43.24  new unit established under section 179A.101 or until June 30, 
 43.25  2001, whichever is earlier.  Exclusive representatives of court 
 43.26  employees certified after the effective date of this section in 
 43.27  the judicial district are immediately upon certification 
 43.28  responsible for bargaining on behalf of employees within the 
 43.29  unit.  They are also responsible for administering grievances 
 43.30  arising under previous contracts covering employees included 
 43.31  within the unit which remain unresolved on June 30, 2001, or 
 43.32  upon agreement with the state court administrator on a contract 
 43.33  for a new unit established under section 179A.101, whichever is 
 43.34  earlier.  Where the employer does not object, these 
 43.35  responsibilities may be varied by agreement between the outgoing 
 43.36  and incoming exclusive representatives.  All other rights and 
 44.1   duties of representation begin on July 1, 2001 of the year in 
 44.2   which the state assumes the funding of court administration in 
 44.3   the judicial district, except that exclusive representatives 
 44.4   certified after the effective date of this section shall 
 44.5   immediately, upon certification, have the right to all employer 
 44.6   information and all forms of access to employees within the 
 44.7   bargaining unit which would be permitted to the current contract 
 44.8   holder, including the rights in section 179A.07, subdivision 6.  
 44.9   This section does not affect an existing collective bargaining 
 44.10  contract.  Incoming exclusive representatives of court employees 
 44.11  from judicial districts that come under section 480.181, 
 44.12  subdivision 1, paragraph (b), are immediately, upon 
 44.13  certification, responsible for bargaining on behalf of all 
 44.14  previously unrepresented employees assigned to their units.  All 
 44.15  other rights and duties of exclusive representatives begin on 
 44.16  July 1, 2001 of the year in which the state assumes the funding 
 44.17  of court administration in the judicial district. 
 44.18     (b) Nothing in Laws 1999, chapter 216, article 7, sections 
 44.19  3 to 15, or sections 2 to 4, 15, or 18, prevents an exclusive 
 44.20  representative certified after the effective date of sections 3 
 44.21  to 15 dates of those provisions from assessing fair share or 
 44.22  dues deductions immediately upon certification for employees in 
 44.23  a unit established under section 179A.101 if the employees were 
 44.24  unrepresented for collective bargaining purposes before that 
 44.25  certification. 
 44.26     Sec. 4.  Minnesota Statutes 2000, section 179A.103, 
 44.27  subdivision 1, is amended to read: 
 44.28     Subdivision 1.  [CONTRACTS.] Contracts for the period 
 44.29  commencing July 1, 2000, of the year in which the state assumes 
 44.30  the cost of court administration in the judicial district for 
 44.31  the judicial district court employees of judicial districts that 
 44.32  are under section 480.181, subdivision 1, paragraph (b), must be 
 44.33  negotiated with the state court administrator.  Negotiations for 
 44.34  those contracts may begin any time after July 1, 1999 of the 
 44.35  year before the state assumes the cost, and may be initiated by 
 44.36  either party notifying the other of the desire to begin the 
 45.1   negotiating process.  Negotiations are subject to this chapter. 
 45.2      Sec. 5.  Minnesota Statutes 2000, section 256.01, 
 45.3   subdivision 2, is amended to read: 
 45.4      Subd. 2.  [SPECIFIC POWERS.] Subject to the provisions of 
 45.5   section 241.021, subdivision 2, the commissioner of human 
 45.6   services shall: 
 45.7      (1) Administer and supervise all forms of public assistance 
 45.8   provided for by state law and other welfare activities or 
 45.9   services as are vested in the commissioner.  Administration and 
 45.10  supervision of human services activities or services includes, 
 45.11  but is not limited to, assuring timely and accurate distribution 
 45.12  of benefits, completeness of service, and quality program 
 45.13  management.  In addition to administering and supervising human 
 45.14  services activities vested by law in the department, the 
 45.15  commissioner shall have the authority to: 
 45.16     (a) require county agency participation in training and 
 45.17  technical assistance programs to promote compliance with 
 45.18  statutes, rules, federal laws, regulations, and policies 
 45.19  governing human services; 
 45.20     (b) monitor, on an ongoing basis, the performance of county 
 45.21  agencies in the operation and administration of human services, 
 45.22  enforce compliance with statutes, rules, federal laws, 
 45.23  regulations, and policies governing welfare services and promote 
 45.24  excellence of administration and program operation; 
 45.25     (c) develop a quality control program or other monitoring 
 45.26  program to review county performance and accuracy of benefit 
 45.27  determinations; 
 45.28     (d) require county agencies to make an adjustment to the 
 45.29  public assistance benefits issued to any individual consistent 
 45.30  with federal law and regulation and state law and rule and to 
 45.31  issue or recover benefits as appropriate; 
 45.32     (e) delay or deny payment of all or part of the state and 
 45.33  federal share of benefits and administrative reimbursement 
 45.34  according to the procedures set forth in section 256.017; 
 45.35     (f) make contracts with and grants to public and private 
 45.36  agencies and organizations, both profit and nonprofit, and 
 46.1   individuals, using appropriated funds; and 
 46.2      (g) enter into contractual agreements with federally 
 46.3   recognized Indian tribes with a reservation in Minnesota to the 
 46.4   extent necessary for the tribe to operate a federally approved 
 46.5   family assistance program or any other program under the 
 46.6   supervision of the commissioner.  The commissioner shall also 
 46.7   enter into contractual agreements with federally recognized 
 46.8   Indian tribes with a reservation in Minnesota to the extent 
 46.9   necessary for the tribe to operate placement programs for Indian 
 46.10  children, so that the tribes may receive direct federal and 
 46.11  state reimbursement, where appropriate, for the placement of 
 46.12  individual Indian children.  The commissioner shall consult with 
 46.13  the affected county or counties in the contractual agreement 
 46.14  negotiations, if the county or counties wish to be included, in 
 46.15  order to avoid the duplication of county and tribal assistance 
 46.16  program services.  The commissioner may establish necessary 
 46.17  accounts for the purposes of receiving and disbursing funds as 
 46.18  necessary for the operation of the programs. 
 46.19     (2) Inform county agencies, on a timely basis, of changes 
 46.20  in statute, rule, federal law, regulation, and policy necessary 
 46.21  to county agency administration of the programs. 
 46.22     (3) Administer and supervise all child welfare activities; 
 46.23  promote the enforcement of laws protecting handicapped, 
 46.24  dependent, neglected and delinquent children, and children born 
 46.25  to mothers who were not married to the children's fathers at the 
 46.26  times of the conception nor at the births of the children; 
 46.27  license and supervise child-caring and child-placing agencies 
 46.28  and institutions; supervise the care of children in boarding and 
 46.29  foster homes or in private institutions; and generally perform 
 46.30  all functions relating to the field of child welfare now vested 
 46.31  in the state board of control. 
 46.32     (4) Administer and supervise all noninstitutional service 
 46.33  to handicapped persons, including those who are visually 
 46.34  impaired, hearing impaired, or physically impaired or otherwise 
 46.35  handicapped.  The commissioner may provide and contract for the 
 46.36  care and treatment of qualified indigent children in facilities 
 47.1   other than those located and available at state hospitals when 
 47.2   it is not feasible to provide the service in state hospitals. 
 47.3      (5) Assist and actively cooperate with other departments, 
 47.4   agencies and institutions, local, state, and federal, by 
 47.5   performing services in conformity with the purposes of Laws 
 47.6   1939, chapter 431. 
 47.7      (6) Act as the agent of and cooperate with the federal 
 47.8   government in matters of mutual concern relative to and in 
 47.9   conformity with the provisions of Laws 1939, chapter 431, 
 47.10  including the administration of any federal funds granted to the 
 47.11  state to aid in the performance of any functions of the 
 47.12  commissioner as specified in Laws 1939, chapter 431, and 
 47.13  including the promulgation of rules making uniformly available 
 47.14  medical care benefits to all recipients of public assistance, at 
 47.15  such times as the federal government increases its participation 
 47.16  in assistance expenditures for medical care to recipients of 
 47.17  public assistance, the cost thereof to be borne in the same 
 47.18  proportion as are grants of aid to said recipients. 
 47.19     (7) Establish and maintain any administrative units 
 47.20  reasonably necessary for the performance of administrative 
 47.21  functions common to all divisions of the department. 
 47.22     (8) Act as designated guardian of both the estate and the 
 47.23  person of all the wards of the state of Minnesota, whether by 
 47.24  operation of law or by an order of court, without any further 
 47.25  act or proceeding whatever, except as to persons committed as 
 47.26  mentally retarded.  For children under the guardianship of the 
 47.27  commissioner whose interests would be best served by adoptive 
 47.28  placement, the commissioner may contract with a licensed 
 47.29  child-placing agency to provide adoption services.  A contract 
 47.30  with a licensed child-placing agency must be designed to 
 47.31  supplement existing county efforts and may not replace existing 
 47.32  county programs, unless the replacement is agreed to by the 
 47.33  county board and the appropriate exclusive bargaining 
 47.34  representative or the commissioner has evidence that child 
 47.35  placements of the county continue to be substantially below that 
 47.36  of other counties.  Funds encumbered and obligated under an 
 48.1   agreement for a specific child shall remain available until the 
 48.2   terms of the agreement are fulfilled or the agreement is 
 48.3   terminated. 
 48.4      (9) Act as coordinating referral and informational center 
 48.5   on requests for service for newly arrived immigrants coming to 
 48.6   Minnesota. 
 48.7      (10) The specific enumeration of powers and duties as 
 48.8   hereinabove set forth shall in no way be construed to be a 
 48.9   limitation upon the general transfer of powers herein contained. 
 48.10     (11) Establish county, regional, or statewide schedules of 
 48.11  maximum fees and charges which may be paid by county agencies 
 48.12  for medical, dental, surgical, hospital, nursing and nursing 
 48.13  home care and medicine and medical supplies under all programs 
 48.14  of medical care provided by the state and for congregate living 
 48.15  care under the income maintenance programs. 
 48.16     (12) Have the authority to conduct and administer 
 48.17  experimental projects to test methods and procedures of 
 48.18  administering assistance and services to recipients or potential 
 48.19  recipients of public welfare.  To carry out such experimental 
 48.20  projects, it is further provided that the commissioner of human 
 48.21  services is authorized to waive the enforcement of existing 
 48.22  specific statutory program requirements, rules, and standards in 
 48.23  one or more counties.  The order establishing the waiver shall 
 48.24  provide alternative methods and procedures of administration, 
 48.25  shall not be in conflict with the basic purposes, coverage, or 
 48.26  benefits provided by law, and in no event shall the duration of 
 48.27  a project exceed four years.  It is further provided that no 
 48.28  order establishing an experimental project as authorized by the 
 48.29  provisions of this section shall become effective until the 
 48.30  following conditions have been met: 
 48.31     (a) The secretary of health and human services of the 
 48.32  United States has agreed, for the same project, to waive state 
 48.33  plan requirements relative to statewide uniformity. 
 48.34     (b) A comprehensive plan, including estimated project 
 48.35  costs, shall be approved by the legislative advisory commission 
 48.36  and filed with the commissioner of administration.  
 49.1      (13) According to federal requirements, establish 
 49.2   procedures to be followed by local welfare boards in creating 
 49.3   citizen advisory committees, including procedures for selection 
 49.4   of committee members. 
 49.5      (14) Allocate federal fiscal disallowances or sanctions 
 49.6   which are based on quality control error rates for the aid to 
 49.7   families with dependent children program formerly codified in 
 49.8   sections 256.72 to 256.87, medical assistance, or food stamp 
 49.9   program in the following manner:  
 49.10     (a) One-half of the total amount of the disallowance shall 
 49.11  be borne by the county boards responsible for administering the 
 49.12  programs.  For the medical assistance and the AFDC program 
 49.13  formerly codified in sections 256.72 to 256.87, disallowances 
 49.14  shall be shared by each county board in the same proportion as 
 49.15  that county's expenditures for the sanctioned program are to the 
 49.16  total of all counties' expenditures for the AFDC program 
 49.17  formerly codified in sections 256.72 to 256.87, and medical 
 49.18  assistance programs.  For the food stamp program, sanctions 
 49.19  shall be shared by each county board, with 50 percent of the 
 49.20  sanction being distributed to each county in the same proportion 
 49.21  as that county's administrative costs for food stamps are to the 
 49.22  total of all food stamp administrative costs for all counties, 
 49.23  and 50 percent of the sanctions being distributed to each county 
 49.24  in the same proportion as that county's value of food stamp 
 49.25  benefits issued are to the total of all benefits issued for all 
 49.26  counties.  Each county shall pay its share of the disallowance 
 49.27  to the state of Minnesota.  When a county fails to pay the 
 49.28  amount due hereunder, the commissioner may deduct the amount 
 49.29  from reimbursement otherwise due the county, or the attorney 
 49.30  general, upon the request of the commissioner, may institute 
 49.31  civil action to recover the amount due. 
 49.32     (b) Notwithstanding the provisions of paragraph (a), if the 
 49.33  disallowance results from knowing noncompliance by one or more 
 49.34  counties with a specific program instruction, and that knowing 
 49.35  noncompliance is a matter of official county board record, the 
 49.36  commissioner may require payment or recover from the county or 
 50.1   counties, in the manner prescribed in paragraph (a), an amount 
 50.2   equal to the portion of the total disallowance which resulted 
 50.3   from the noncompliance, and may distribute the balance of the 
 50.4   disallowance according to paragraph (a).  
 50.5      (15) Develop and implement special projects that maximize 
 50.6   reimbursements and result in the recovery of money to the 
 50.7   state.  For the purpose of recovering state money, the 
 50.8   commissioner may enter into contracts with third parties.  Any 
 50.9   recoveries that result from projects or contracts entered into 
 50.10  under this paragraph shall be deposited in the state treasury 
 50.11  and credited to a special account until the balance in the 
 50.12  account reaches $1,000,000.  When the balance in the account 
 50.13  exceeds $1,000,000, the excess shall be transferred and credited 
 50.14  to the general fund.  All money in the account is appropriated 
 50.15  to the commissioner for the purposes of this paragraph. 
 50.16     (16) Have the authority to make direct payments to 
 50.17  facilities providing shelter to women and their children 
 50.18  according to section 256D.05, subdivision 3.  Upon the written 
 50.19  request of a shelter facility that has been denied payments 
 50.20  under section 256D.05, subdivision 3, the commissioner shall 
 50.21  review all relevant evidence and make a determination within 30 
 50.22  days of the request for review regarding issuance of direct 
 50.23  payments to the shelter facility.  Failure to act within 30 days 
 50.24  shall be considered a determination not to issue direct payments.
 50.25     (17) Have the authority to establish and enforce the 
 50.26  following county reporting requirements:  
 50.27     (a) The commissioner shall establish fiscal and statistical 
 50.28  reporting requirements necessary to account for the expenditure 
 50.29  of funds allocated to counties for human services programs.  
 50.30  When establishing financial and statistical reporting 
 50.31  requirements, the commissioner shall evaluate all reports, in 
 50.32  consultation with the counties, to determine if the reports can 
 50.33  be simplified or the number of reports can be reduced. 
 50.34     (b) The county board shall submit monthly or quarterly 
 50.35  reports to the department as required by the commissioner.  
 50.36  Monthly reports are due no later than 15 working days after the 
 51.1   end of the month.  Quarterly reports are due no later than 30 
 51.2   calendar days after the end of the quarter, unless the 
 51.3   commissioner determines that the deadline must be shortened to 
 51.4   20 calendar days to avoid jeopardizing compliance with federal 
 51.5   deadlines or risking a loss of federal funding.  Only reports 
 51.6   that are complete, legible, and in the required format shall be 
 51.7   accepted by the commissioner.  
 51.8      (c) If the required reports are not received by the 
 51.9   deadlines established in clause (b), the commissioner may delay 
 51.10  payments and withhold funds from the county board until the next 
 51.11  reporting period.  When the report is needed to account for the 
 51.12  use of federal funds and the late report results in a reduction 
 51.13  in federal funding, the commissioner shall withhold from the 
 51.14  county boards with late reports an amount equal to the reduction 
 51.15  in federal funding until full federal funding is received.  
 51.16     (d) A county board that submits reports that are late, 
 51.17  illegible, incomplete, or not in the required format for two out 
 51.18  of three consecutive reporting periods is considered 
 51.19  noncompliant.  When a county board is found to be noncompliant, 
 51.20  the commissioner shall notify the county board of the reason the 
 51.21  county board is considered noncompliant and request that the 
 51.22  county board develop a corrective action plan stating how the 
 51.23  county board plans to correct the problem.  The corrective 
 51.24  action plan must be submitted to the commissioner within 45 days 
 51.25  after the date the county board received notice of noncompliance.
 51.26     (e) The final deadline for fiscal reports or amendments to 
 51.27  fiscal reports is one year after the date the report was 
 51.28  originally due.  If the commissioner does not receive a report 
 51.29  by the final deadline, the county board forfeits the funding 
 51.30  associated with the report for that reporting period and the 
 51.31  county board must repay any funds associated with the report 
 51.32  received for that reporting period. 
 51.33     (f) The commissioner may not delay payments, withhold 
 51.34  funds, or require repayment under paragraph (c) or (e) if the 
 51.35  county demonstrates that the commissioner failed to provide 
 51.36  appropriate forms, guidelines, and technical assistance to 
 52.1   enable the county to comply with the requirements.  If the 
 52.2   county board disagrees with an action taken by the commissioner 
 52.3   under paragraph (c) or (e), the county board may appeal the 
 52.4   action according to sections 14.57 to 14.69. 
 52.5      (g) Counties subject to withholding of funds under 
 52.6   paragraph (c) or forfeiture or repayment of funds under 
 52.7   paragraph (e) shall not reduce or withhold benefits or services 
 52.8   to clients to cover costs incurred due to actions taken by the 
 52.9   commissioner under paragraph (c) or (e). 
 52.10     (18) Allocate federal fiscal disallowances or sanctions for 
 52.11  audit exceptions when federal fiscal disallowances or sanctions 
 52.12  are based on a statewide random sample for the foster care 
 52.13  program under title IV-E of the Social Security Act, United 
 52.14  States Code, title 42, in direct proportion to each county's 
 52.15  title IV-E foster care maintenance claim for that period. 
 52.16     (19) Be responsible for ensuring the detection, prevention, 
 52.17  investigation, and resolution of fraudulent activities or 
 52.18  behavior by applicants, recipients, and other participants in 
 52.19  the human services programs administered by the department. 
 52.20     (20) Require county agencies to identify overpayments, 
 52.21  establish claims, and utilize all available and cost-beneficial 
 52.22  methodologies to collect and recover these overpayments in the 
 52.23  human services programs administered by the department. 
 52.24     (21) Have the authority to administer a drug rebate program 
 52.25  for drugs purchased pursuant to the prescription drug program 
 52.26  established under section 256.955 after the beneficiary's 
 52.27  satisfaction of any deductible established in the program.  The 
 52.28  commissioner shall require a rebate agreement from all 
 52.29  manufacturers of covered drugs as defined in section 256B.0625, 
 52.30  subdivision 13.  Rebate agreements for prescription drugs 
 52.31  delivered on or after July 1, 2002, must include rebates for 
 52.32  individuals covered under the prescription drug program who are 
 52.33  under 65 years of age.  For each drug, the amount of the rebate 
 52.34  shall be equal to the basic rebate as defined for purposes of 
 52.35  the federal rebate program in United States Code, title 42, 
 52.36  section 1396r-8(c)(1).  This basic rebate shall be applied to 
 53.1   single-source and multiple-source drugs.  The manufacturers must 
 53.2   provide full payment within 30 days of receipt of the state 
 53.3   invoice for the rebate within the terms and conditions used for 
 53.4   the federal rebate program established pursuant to section 1927 
 53.5   of title XIX of the Social Security Act.  The manufacturers must 
 53.6   provide the commissioner with any information necessary to 
 53.7   verify the rebate determined per drug.  The rebate program shall 
 53.8   utilize the terms and conditions used for the federal rebate 
 53.9   program established pursuant to section 1927 of title XIX of the 
 53.10  Social Security Act. 
 53.11     (22) Operate the department's communication systems account 
 53.12  established in Laws 1993, First Special Session chapter 1, 
 53.13  article 1, section 2, subdivision 2, to manage shared 
 53.14  communication costs necessary for the operation of the programs 
 53.15  the commissioner supervises.  A communications account may also 
 53.16  be established for each regional treatment center which operates 
 53.17  communications systems.  Each account must be used to manage 
 53.18  shared communication costs necessary for the operations of the 
 53.19  programs the commissioner supervises.  The commissioner may 
 53.20  distribute the costs of operating and maintaining communication 
 53.21  systems to participants in a manner that reflects actual usage. 
 53.22  Costs may include acquisition, licensing, insurance, 
 53.23  maintenance, repair, staff time and other costs as determined by 
 53.24  the commissioner.  Nonprofit organizations and state, county, 
 53.25  and local government agencies involved in the operation of 
 53.26  programs the commissioner supervises may participate in the use 
 53.27  of the department's communications technology and share in the 
 53.28  cost of operation.  The commissioner may accept on behalf of the 
 53.29  state any gift, bequest, devise or personal property of any 
 53.30  kind, or money tendered to the state for any lawful purpose 
 53.31  pertaining to the communication activities of the department.  
 53.32  Any money received for this purpose must be deposited in the 
 53.33  department's communication systems accounts.  Money collected by 
 53.34  the commissioner for the use of communication systems must be 
 53.35  deposited in the state communication systems account and is 
 53.36  appropriated to the commissioner for purposes of this section. 
 54.1      (23) Receive any federal matching money that is made 
 54.2   available through the medical assistance program for the 
 54.3   consumer satisfaction survey.  Any federal money received for 
 54.4   the survey is appropriated to the commissioner for this 
 54.5   purpose.  The commissioner may expend the federal money received 
 54.6   for the consumer satisfaction survey in either year of the 
 54.7   biennium. 
 54.8      (24) Incorporate cost reimbursement claims from First Call 
 54.9   Minnesota into the federal cost reimbursement claiming processes 
 54.10  of the department according to federal law, rule, and 
 54.11  regulations.  Any reimbursement received is appropriated to the 
 54.12  commissioner and shall be disbursed to First Call Minnesota 
 54.13  according to normal department payment schedules. 
 54.14     (25) Develop recommended standards for foster care homes 
 54.15  that address the components of specialized therapeutic services 
 54.16  to be provided by foster care homes with those services. 
 54.17     Sec. 6.  Minnesota Statutes 2000, section 260.765, is 
 54.18  amended by adding a subdivision to read: 
 54.19     Subd. 2a.  [FINANCIAL RESPONSIBILITY.] When an Indian child 
 54.20  is voluntarily placed in foster care by a tribal social services 
 54.21  agency, the commissioner shall be responsible for reimbursing 
 54.22  the nonfederal share of the costs of placement. 
 54.23     Sec. 7.  Minnesota Statutes 2000, section 260.771, 
 54.24  subdivision 4, is amended to read: 
 54.25     Subd. 4.  [EFFECT OF TRIBAL COURT PLACEMENT ORDERS.] To the 
 54.26  extent that any child subject to sections 260.755 to 260.835 is 
 54.27  otherwise eligible for social services, orders of a tribal court 
 54.28  concerning placement of such child shall have the same force and 
 54.29  effect as orders of a court of this state.  In any case where 
 54.30  the tribal court orders placement through a local social 
 54.31  services agency, the court shall provide to the local agency 
 54.32  notice and an opportunity to be heard regarding the 
 54.33  placement.  The commissioner shall reimburse the local social 
 54.34  services agency or tribal social services agency for the 
 54.35  nonfederal share of the costs for Indian children placed 
 54.36  according to a tribal court placement order.  Determination of 
 55.1   county of financial responsibility for the placement shall be 
 55.2   determined by the local social services agency in accordance 
 55.3   with section 256G.02, subdivision 4.  Disputes concerning the 
 55.4   county of financial responsibility shall be settled in the 
 55.5   manner prescribed in section 256G.09.  
 55.6      Sec. 8.  Minnesota Statutes 2000, section 260B.331, 
 55.7   subdivision 1, is amended to read: 
 55.8      Subdivision 1.  [CARE, EXAMINATION, OR TREATMENT.] (a)(1) 
 55.9   Whenever legal custody of a child is transferred by the court to 
 55.10  a local social services agency, or 
 55.11     (2) whenever legal custody is transferred to a person other 
 55.12  than the local social services agency, but under the supervision 
 55.13  of the local social services agency, and 
 55.14     (3) whenever a child is given physical or mental 
 55.15  examinations or treatment under order of the court, and no 
 55.16  provision is otherwise made by law for payment for the care, 
 55.17  examination, or treatment of the child, these costs are a charge 
 55.18  upon the welfare funds of the county in which proceedings are 
 55.19  held upon certification of the judge of juvenile court. 
 55.20     (b) The court shall order, and the local social services 
 55.21  agency shall require, the parents or custodian of a child, while 
 55.22  the child is under the age of 18, to use the total income and 
 55.23  resources attributable to the child for the period of care, 
 55.24  examination, or treatment, except for clothing and personal 
 55.25  needs allowance as provided in section 256B.35, to reimburse the 
 55.26  county for the cost of care, examination, or treatment.  Income 
 55.27  and resources attributable to the child include, but are not 
 55.28  limited to, social security benefits, supplemental security 
 55.29  income (SSI), veterans benefits, railroad retirement benefits 
 55.30  and child support.  When the child is over the age of 18, and 
 55.31  continues to receive care, examination, or treatment, the court 
 55.32  shall order, and the local social services agency shall require, 
 55.33  reimbursement from the child for the cost of care, examination, 
 55.34  or treatment from the income and resources attributable to the 
 55.35  child less the clothing and personal needs allowance.  
 55.36     (c) If the income and resources attributable to the child 
 56.1   are not enough to reimburse the county for the full cost of the 
 56.2   care, examination, or treatment, the court shall inquire into 
 56.3   the ability of the parents to support the child and, after 
 56.4   giving the parents a reasonable opportunity to be heard, the 
 56.5   court shall order, and the local social services agency shall 
 56.6   require, the parents to contribute to the cost of care, 
 56.7   examination, or treatment of the child.  Except in delinquency 
 56.8   cases where the victim is a member of the child's immediate 
 56.9   family, when determining the amount to be contributed by the 
 56.10  parents, the court shall use a fee schedule based upon ability 
 56.11  to pay that is established by the local social services agency 
 56.12  and approved by the commissioner of human services.  In 
 56.13  delinquency cases where the victim is a member of the child's 
 56.14  immediate family, the court shall use the fee schedule but may 
 56.15  also take into account the seriousness of the offense and any 
 56.16  expenses which the parents have incurred as a result of the 
 56.17  offense.  The income of a stepparent who has not adopted a child 
 56.18  shall be excluded in calculating the parental contribution under 
 56.19  this section. 
 56.20     (d) The court shall order the amount of reimbursement 
 56.21  attributable to the parents or custodian, or attributable to the 
 56.22  child, or attributable to both sources, withheld under chapter 
 56.23  518 from the income of the parents or the custodian of the 
 56.24  child.  A parent or custodian who fails to pay without good 
 56.25  reason may be proceeded against for contempt, or the court may 
 56.26  inform the county attorney, who shall proceed to collect the 
 56.27  unpaid sums, or both procedures may be used. 
 56.28     (e) If the court orders a physical or mental examination 
 56.29  for a child, the examination is a medically necessary service 
 56.30  for purposes of determining whether the service is covered by a 
 56.31  health insurance policy, health maintenance contract, or other 
 56.32  health coverage plan.  Court-ordered treatment shall be subject 
 56.33  to policy, contract, or plan requirements for medical 
 56.34  necessity.  Nothing in this paragraph changes or eliminates 
 56.35  benefit limits, conditions of coverage, copayments or 
 56.36  deductibles, provider restrictions, or other requirements in the 
 57.1   policy, contract, or plan that relate to coverage of other 
 57.2   medically necessary services.  
 57.3      (f) Costs charged to the county under this subdivision 
 57.4   shall be fully reimbursed by the commissioner of human services 
 57.5   from funds appropriated for that purpose. 
 57.6      Sec. 9.  Minnesota Statutes 2000, section 260B.331, 
 57.7   subdivision 2, is amended to read: 
 57.8      Subd. 2.  [COST OF GROUP FOSTER CARE.] Whenever a child is 
 57.9   placed in a group foster care facility as provided in section 
 57.10  260B.198, subdivision 1, clause (b) or (c), item (5), the cost 
 57.11  of providing the care shall, upon certification by the juvenile 
 57.12  court, be paid from the welfare fund of the county in which the 
 57.13  proceedings were held.  To reimburse the counties for the costs 
 57.14  of providing group foster care for delinquent children and to 
 57.15  promote the establishment of suitable group foster homes, the 
 57.16  state shall quarterly, from funds appropriated for that purpose, 
 57.17  reimburse counties 50 100 percent of the costs not paid by 
 57.18  federal and other available state aids and grants.  
 57.19  Reimbursement shall be prorated if the appropriation is 
 57.20  insufficient. 
 57.21     The commissioner of corrections shall establish procedures 
 57.22  for reimbursement and certify to the commissioner of finance 
 57.23  each county entitled to receive state aid under the provisions 
 57.24  of this subdivision.  Upon receipt of a certificate the 
 57.25  commissioner of finance shall issue a state warrant to the 
 57.26  county treasurer for the amount due, together with a copy of the 
 57.27  certificate prepared by the commissioner of corrections.  
 57.28     Sec. 10.  Minnesota Statutes 2000, section 260C.331, 
 57.29  subdivision 1, is amended to read: 
 57.30     Subdivision 1.  [CARE, EXAMINATION, OR TREATMENT.] (a) 
 57.31  Except where parental rights are terminated, 
 57.32     (1) whenever legal custody of a child is transferred by the 
 57.33  court to a local social services agency, 
 57.34     (2) whenever legal custody is transferred to a person other 
 57.35  than the local social services agency, but under the supervision 
 57.36  of the local social services agency, or 
 58.1      (3) whenever a child is given physical or mental 
 58.2   examinations or treatment under order of the court, and no 
 58.3   provision is otherwise made by law for payment for the care, 
 58.4   examination, or treatment of the child, these costs are a charge 
 58.5   upon the welfare funds of the county in which proceedings are 
 58.6   held upon certification of the judge of juvenile court. 
 58.7      (b) The court shall order, and the local social services 
 58.8   agency shall require, the parents or custodian of a child, while 
 58.9   the child is under the age of 18, to use the total income and 
 58.10  resources attributable to the child for the period of care, 
 58.11  examination, or treatment, except for clothing and personal 
 58.12  needs allowance as provided in section 256B.35, to reimburse the 
 58.13  county for the cost of care, examination, or treatment.  Income 
 58.14  and resources attributable to the child include, but are not 
 58.15  limited to, social security benefits, supplemental security 
 58.16  income (SSI), veterans benefits, railroad retirement benefits 
 58.17  and child support.  When the child is over the age of 18, and 
 58.18  continues to receive care, examination, or treatment, the court 
 58.19  shall order, and the local social services agency shall require, 
 58.20  reimbursement from the child for the cost of care, examination, 
 58.21  or treatment from the income and resources attributable to the 
 58.22  child less the clothing and personal needs allowance.  
 58.23     (c) If the income and resources attributable to the child 
 58.24  are not enough to reimburse the county for the full cost of the 
 58.25  care, examination, or treatment, the court shall inquire into 
 58.26  the ability of the parents to support the child and, after 
 58.27  giving the parents a reasonable opportunity to be heard, the 
 58.28  court shall order, and the local social services agency shall 
 58.29  require, the parents to contribute to the cost of care, 
 58.30  examination, or treatment of the child.  When determining the 
 58.31  amount to be contributed by the parents, the court shall use a 
 58.32  fee schedule based upon ability to pay that is established by 
 58.33  the local social services agency and approved by the 
 58.34  commissioner of human services.  The income of a stepparent who 
 58.35  has not adopted a child shall be excluded in calculating the 
 58.36  parental contribution under this section. 
 59.1      (d) The court shall order the amount of reimbursement 
 59.2   attributable to the parents or custodian, or attributable to the 
 59.3   child, or attributable to both sources, withheld under chapter 
 59.4   518 from the income of the parents or the custodian of the 
 59.5   child.  A parent or custodian who fails to pay without good 
 59.6   reason may be proceeded against for contempt, or the court may 
 59.7   inform the county attorney, who shall proceed to collect the 
 59.8   unpaid sums, or both procedures may be used. 
 59.9      (e) If the court orders a physical or mental examination 
 59.10  for a child, the examination is a medically necessary service 
 59.11  for purposes of determining whether the service is covered by a 
 59.12  health insurance policy, health maintenance contract, or other 
 59.13  health coverage plan.  Court-ordered treatment shall be subject 
 59.14  to policy, contract, or plan requirements for medical 
 59.15  necessity.  Nothing in this paragraph changes or eliminates 
 59.16  benefit limits, conditions of coverage, copayments or 
 59.17  deductibles, provider restrictions, or other requirements in the 
 59.18  policy, contract, or plan that relate to coverage of other 
 59.19  medically necessary services.  
 59.20     (f) Costs charged to the county under this subdivision 
 59.21  shall be fully reimbursed by the commissioner of human services 
 59.22  from funds appropriated for that purpose. 
 59.23     Sec. 11.  Minnesota Statutes 2000, section 260C.331, 
 59.24  subdivision 2, is amended to read: 
 59.25     Subd. 2.  [COST OF GROUP FOSTER CARE.] Whenever a child is 
 59.26  placed in a group foster care facility as provided in section 
 59.27  260C.201, subdivision 1, paragraph (b), clause (2) or (3), the 
 59.28  cost of providing the care shall, upon certification by the 
 59.29  juvenile court, be paid from the welfare fund of the county in 
 59.30  which the proceedings were held.  To reimburse the counties for 
 59.31  the costs of promoting the establishment of suitable group 
 59.32  foster homes, the state shall quarterly, from funds appropriated 
 59.33  for that purpose, reimburse counties 50 100 percent of the costs 
 59.34  not paid by federal and other available state aids and grants.  
 59.35  Reimbursement shall be prorated if the appropriation is 
 59.36  insufficient. 
 60.1      The commissioner of corrections shall establish procedures 
 60.2   for reimbursement and certify to the commissioner of finance 
 60.3   each county entitled to receive state aid under the provisions 
 60.4   of this subdivision.  Upon receipt of a certificate the 
 60.5   commissioner of finance shall issue a state warrant to the 
 60.6   county treasurer for the amount due, together with a copy of the 
 60.7   certificate prepared by the commissioner of corrections. 
 60.8      Sec. 12.  Minnesota Statutes 2000, section 273.1398, 
 60.9   subdivision 4a, is amended to read: 
 60.10     Subd. 4a.  [AID OFFSET FOR COURT COSTS.] (a) By July 15, 
 60.11  1999 of the year preceding the year in which the state assumes 
 60.12  the cost of court administration in the judicial district, the 
 60.13  supreme court shall determine and certify to the commissioner of 
 60.14  revenue for each county, other than counties located in the 
 60.15  eighth judicial district, the county's share of the costs 
 60.16  assumed under Laws 1999, chapter 216, article 7, and sections 2 
 60.17  to 4, 15, and 18, during the succeeding fiscal year beginning 
 60.18  July 1, 2000, less an amount equal to the county's share of 
 60.19  transferred fines collected by the district courts in the county 
 60.20  during the calendar year 1998 two years prior to the calendar 
 60.21  year in which the state assumes the cost of court administration 
 60.22  in the judicial district.  
 60.23     (b) Payments to a county under subdivision 2 or section 
 60.24  273.166 for the calendar year 2000 in which the state assumes 
 60.25  the cost of court administration in the judicial district must 
 60.26  be permanently reduced by an amount equal to 75 50 percent of 
 60.27  the net cost to the state for assumption of district court costs 
 60.28  as certified in paragraph (a). 
 60.29     (c) Payments to a county under subdivision 2 or section 
 60.30  273.166 for the calendar year 2001 succeeding the year in which 
 60.31  the state assumes the cost of court administration must be 
 60.32  permanently reduced by an amount equal to 25 50 percent of the 
 60.33  net cost to the state for assumption of district court costs as 
 60.34  certified in paragraph (a). 
 60.35     (d) Payments to a county under subdivision 2 for calendar 
 60.36  year 2001 are permanently increased by an amount equal to 7.5 
 61.1   percent of the county's share of transferred fines collected by 
 61.2   the district courts in the county during calendar year 1998, as 
 61.3   determined under paragraph (a).  If the amount determined in 
 61.4   paragraph (a) exceeds the amount of aid a county is scheduled to 
 61.5   be paid under subdivision 2 in 2000, then the county shall not 
 61.6   receive an aid increase under this paragraph. 
 61.7      Sec. 13.  Minnesota Statutes 2000, section 299D.03, 
 61.8   subdivision 5, is amended to read: 
 61.9      Subd. 5.  [FINES AND FORFEITED BAIL MONEY.] (a) All fines 
 61.10  and forfeited bail money, from traffic and motor vehicle law 
 61.11  violations, collected from persons apprehended or arrested by 
 61.12  officers of the state patrol, shall be paid by the person or 
 61.13  officer collecting the fines, forfeited bail money or 
 61.14  installments thereof, on or before the tenth day after the last 
 61.15  day of the month in which these moneys were collected, to the 
 61.16  county treasurer of the county where the violation occurred.  
 61.17  Three-eighths of these receipts shall be credited to the general 
 61.18  revenue fund of the county, except that in a county in a 
 61.19  judicial district under section 480.181, subdivision 1, 
 61.20  paragraph (b), as added in Laws 1999, chapter 216, article 7, 
 61.21  section 26, or section 15, this three-eighths share must be 
 61.22  transmitted to the state treasurer for deposit in the state 
 61.23  treasury and credited to the general fund.  The other 
 61.24  five-eighths of these receipts shall be transmitted by that 
 61.25  officer to the state treasurer and shall be credited as follows: 
 61.26     (1) In the fiscal year ending June 30, 1991, the first 
 61.27  $275,000 in money received by the state treasurer after June 4, 
 61.28  1991, must be credited to the transportation services fund, and 
 61.29  the remainder in the fiscal year credited to the trunk highway 
 61.30  fund. 
 61.31     (2) In fiscal year 1992, the first $215,000 in money 
 61.32  received by the state treasurer in the fiscal year must be 
 61.33  credited to the transportation services fund, and the remainder 
 61.34  credited to the trunk highway fund. 
 61.35     (3) In fiscal year 1993 and subsequent years, the entire 
 61.36  amount received by the state treasurer must be credited to the 
 62.1   trunk highway fund.  If, however, the violation occurs within a 
 62.2   municipality and the city attorney prosecutes the offense, and a 
 62.3   plea of not guilty is entered, one-third of the receipts shall 
 62.4   be credited to the general revenue fund of the county, one-third 
 62.5   of the receipts shall be paid to the municipality prosecuting 
 62.6   the offense, and one-third shall be transmitted to the state 
 62.7   treasurer as provided in this subdivision.  All costs of 
 62.8   participation in a nationwide police communication system 
 62.9   chargeable to the state of Minnesota shall be paid from 
 62.10  appropriations for that purpose. 
 62.11     (b) Notwithstanding any other provisions of law, all fines 
 62.12  and forfeited bail money from violations of statutes governing 
 62.13  the maximum weight of motor vehicles, collected from persons 
 62.14  apprehended or arrested by employees of the state of Minnesota, 
 62.15  by means of stationary or portable scales operated by these 
 62.16  employees, shall be paid by the person or officer collecting the 
 62.17  fines or forfeited bail money, on or before the tenth day after 
 62.18  the last day of the month in which the collections were made, to 
 62.19  the county treasurer of the county where the violation 
 62.20  occurred.  Five-eighths of these receipts shall be transmitted 
 62.21  by that officer to the state treasurer and shall be credited to 
 62.22  the highway user tax distribution fund.  Three-eighths of these 
 62.23  receipts shall be credited to the general revenue fund of the 
 62.24  county, except that in a county in a judicial district under 
 62.25  section 480.181, subdivision 1, paragraph (b), as added in Laws 
 62.26  1999, chapter 216, article 7, section 26, or section 15, this 
 62.27  three-eighths share must be transmitted to the state treasurer 
 62.28  for deposit in the state treasury and credited to the general 
 62.29  fund. 
 62.30     Sec. 14.  Minnesota Statutes 2000, section 357.021, 
 62.31  subdivision 1a, is amended to read: 
 62.32     Subd. 1a.  [TRANSMITTAL OF FEES TO STATE TREASURER.] (a) 
 62.33  Every person, including the state of Minnesota and all bodies 
 62.34  politic and corporate, who shall transact any business in the 
 62.35  district court, shall pay to the court administrator of said 
 62.36  court the sundry fees prescribed in subdivision 2.  Except as 
 63.1   provided in paragraph (d), the court administrator shall 
 63.2   transmit the fees monthly to the state treasurer for deposit in 
 63.3   the state treasury and credit to the general fund.  
 63.4      (b) In a county which has a screener-collector position, 
 63.5   fees paid by a county pursuant to this subdivision shall be 
 63.6   transmitted monthly to the county treasurer, who shall apply the 
 63.7   fees first to reimburse the county for the amount of the salary 
 63.8   paid for the screener-collector position.  The balance of the 
 63.9   fees collected shall then be forwarded to the state treasurer 
 63.10  for deposit in the state treasury and credited to the general 
 63.11  fund.  In a county in a judicial district under section 480.181, 
 63.12  subdivision 1, paragraph (b), as added in Laws 1999, chapter 
 63.13  216, article 7, section 26, or section 15, which has a 
 63.14  screener-collector position, the fees paid by a county shall be 
 63.15  transmitted monthly to the state treasurer for deposit in the 
 63.16  state treasury and credited to the general fund.  A 
 63.17  screener-collector position for purposes of this paragraph is an 
 63.18  employee whose function is to increase the collection of fines 
 63.19  and to review the incomes of potential clients of the public 
 63.20  defender, in order to verify eligibility for that service. 
 63.21     (c) No fee is required under this section from the public 
 63.22  authority or the party the public authority represents in an 
 63.23  action for: 
 63.24     (1) child support enforcement or modification, medical 
 63.25  assistance enforcement, or establishment of parentage in the 
 63.26  district court, or in a proceeding under section 484.702; 
 63.27     (2) civil commitment under chapter 253B; 
 63.28     (3) the appointment of a public conservator or public 
 63.29  guardian or any other action under chapters 252A and 525; 
 63.30     (4) wrongfully obtaining public assistance under section 
 63.31  256.98 or 256D.07, or recovery of overpayments of public 
 63.32  assistance; 
 63.33     (5) court relief under chapter 260; 
 63.34     (6) forfeiture of property under sections 169A.63 and 
 63.35  609.531 to 609.5317; 
 63.36     (7) recovery of amounts issued by political subdivisions or 
 64.1   public institutions under sections 246.52, 252.27, 256.045, 
 64.2   256.25, 256.87, 256B.042, 256B.14, 256B.15, 256B.37, 260B.331, 
 64.3   and 260C.331, or other sections referring to other forms of 
 64.4   public assistance; 
 64.5      (8) restitution under section 611A.04; or 
 64.6      (9) actions seeking monetary relief in favor of the state 
 64.7   pursuant to section 16D.14, subdivision 5. 
 64.8      (d) The fees collected for child support modifications 
 64.9   under subdivision 2, clause (13), must be transmitted to the 
 64.10  county treasurer for deposit in the county general fund.  The 
 64.11  fees must be used by the county to pay for child support 
 64.12  enforcement efforts by county attorneys. 
 64.13     Sec. 15.  Minnesota Statutes 2000, section 480.181, 
 64.14  subdivision 1, is amended to read: 
 64.15     Subdivision 1.  [STATE EMPLOYEES; COMPENSATION.] (a) 
 64.16  District court referees, judicial officers, court reporters, law 
 64.17  clerks, district administration staff, other than district 
 64.18  administration staff in the second and fourth judicial 
 64.19  districts, guardian ad litem program coordinators and staff, and 
 64.20  other court employees under paragraph (b), are state employees 
 64.21  and are governed by the judicial branch personnel rules adopted 
 64.22  by the supreme court.  The supreme court, in consultation with 
 64.23  the conference of chief judges, shall establish the salary range 
 64.24  of these employees under the judicial branch personnel rules.  
 64.25  In establishing the salary ranges, the supreme court shall 
 64.26  consider differences in the cost of living in different areas of 
 64.27  the state. 
 64.28     (b) The court administrator and employees of the court 
 64.29  administrator who are in the fifth, seventh, eighth, or ninth 
 64.30  judicial district are state employees.  The court administrator 
 64.31  and employees of the court administrator in the remaining 
 64.32  judicial districts become state employees as follows: 
 64.33     (1) effective July 1, 2003, for the first and sixth 
 64.34  judicial districts; 
 64.35     (2) effective July 1, 2004, for the third and fourth 
 64.36  judicial districts; and 
 65.1      (3) effective July 1, 2005, for the second and tenth 
 65.2   judicial districts. 
 65.3      Sec. 16.  Minnesota Statutes 2000, section 487.33, 
 65.4   subdivision 5, is amended to read: 
 65.5      Subd. 5.  [ALLOCATION.] The court administrator shall 
 65.6   provide the county treasurer with the name of the municipality 
 65.7   or other subdivision of government where the offense was 
 65.8   committed which employed or provided by contract the arresting 
 65.9   or apprehending officer and the name of the municipality or 
 65.10  other subdivision of government which employed the prosecuting 
 65.11  attorney or otherwise provided for prosecution of the offense 
 65.12  for each fine or penalty and the total amount of fines or 
 65.13  penalties collected for each municipality or other subdivision 
 65.14  of government.  On or before the last day of each month, the 
 65.15  county treasurer shall pay over to the treasurer of each 
 65.16  municipality or subdivision of government within the county all 
 65.17  fines or penalties for parking violations for which complaints 
 65.18  and warrants have not been issued and one-third of all fines or 
 65.19  penalties collected during the previous month for offenses 
 65.20  committed within the municipality or subdivision of government 
 65.21  from persons arrested or issued citations by officers employed 
 65.22  by the municipality or subdivision or provided by the 
 65.23  municipality or subdivision by contract.  An additional 
 65.24  one-third of all fines or penalties shall be paid to the 
 65.25  municipality or subdivision of government providing prosecution 
 65.26  of offenses of the type for which the fine or penalty is 
 65.27  collected occurring within the municipality or subdivision, 
 65.28  imposed for violations of state statute or of an ordinance, 
 65.29  charter provision, rule or regulation of a city whether or not a 
 65.30  guilty plea is entered or bail is forfeited.  Except as provided 
 65.31  in section 299D.03, subdivision 5, or as otherwise provided by 
 65.32  law, all other fines and forfeitures and all fees and statutory 
 65.33  court costs collected by the court administrator shall be paid 
 65.34  to the county treasurer of the county in which the funds were 
 65.35  collected who shall dispense them as provided by law.  In a 
 65.36  county in a judicial district under section 480.181, subdivision 
 66.1   1, paragraph (b), as added in Laws 1999, chapter 216, article 7, 
 66.2   section 26, or section 15, all other fines, forfeitures, fees, 
 66.3   and statutory court costs must be paid to the state treasurer 
 66.4   for deposit in the state treasury and credited to the general 
 66.5   fund. 
 66.6      Sec. 17.  Minnesota Statutes 2000, section 574.34, 
 66.7   subdivision 1, is amended to read: 
 66.8      Subdivision 1.  [GENERAL.] Fines and forfeitures not 
 66.9   specially granted or appropriated by law shall be paid into the 
 66.10  treasury of the county where they are incurred, except in a 
 66.11  county in a judicial district under section 480.181, subdivision 
 66.12  1, paragraph (b), as added in Laws 1999, chapter 216, article 7, 
 66.13  section 26, or section 15, the fines and forfeitures must be 
 66.14  deposited in the state treasury and credited to the general fund.
 66.15     Sec. 18.  [TRANSITIONAL PROVISIONS.] 
 66.16     Subdivision 1.  [HIRING AND SALARY MORATORIUM.] A county 
 66.17  may not increase the number of employees in the county in a 
 66.18  position that is being transferred to state employment under 
 66.19  this act without approval of the supreme court, unless the 
 66.20  increase was authorized before January 1 of the year prior to 
 66.21  the year when the state assumes the cost of district court 
 66.22  administration in the judicial district in which the county is 
 66.23  located.  A county may not increase the salaries of these 
 66.24  employees without approval of the supreme court, unless the 
 66.25  increase is made under a plan adopted before January 1 of the 
 66.26  year prior to the year when the state assumes the cost of 
 66.27  district court administration in the judicial district in which 
 66.28  the county is located. 
 66.29     Subd. 2.  [TRANSFER OF PROPERTY.] The title to personal 
 66.30  property that is used in the scope of their employment by 
 66.31  employees being transferred to state employment under this 
 66.32  article is transferred to the state when they become state 
 66.33  employees.  
 66.34     Subd. 3.  [RULES.] The supreme court, in consultation with 
 66.35  the conference of chief judges, may adopt rules to implement 
 66.36  this section and sections 2 to 4 and 15.  
 67.1      Subd. 4.  [BUDGETS.] Notwithstanding any law to the 
 67.2   contrary, the fiscal year budgets for the year prior to the year 
 67.3   in which the state assumes the cost of court administration in 
 67.4   the judicial district for the court administrators' offices 
 67.5   being transferred to state employment under this section and 
 67.6   sections 2 to 4 and 15, including the number of complement 
 67.7   positions and salaries, must be submitted by the court 
 67.8   administrators to the supreme court.  The budgets must include 
 67.9   the current levels of funding and positions at the time of 
 67.10  submission as well as any requests for increases in funding and 
 67.11  positions. 
 67.12     Sec. 19.  [APPROPRIATIONS.] 
 67.13     (a) $....... is appropriated from the general fund to the 
 67.14  commissioner of human services for the biennium ending June 30, 
 67.15  2003, for purposes of reimbursing counties for the costs of 
 67.16  placements under Minnesota Statutes, sections 260B.331, 
 67.17  subdivision 1, paragraph (f); and 260C.331, subdivision 1, 
 67.18  paragraph (f). 
 67.19     (b) $....... is appropriated to the commissioner of 
 67.20  corrections from the general fund for the biennium ending June 
 67.21  30, 2003, for the purpose of reimbursing counties for the costs 
 67.22  of placements specified in Minnesota Statutes, sections 
 67.23  260B.331, subdivision 2; and 260C.331, subdivision 2. 
 67.24     Sec. 20.  [EFFECTIVE DATE.] 
 67.25     Sections 1, 13, 14, 16, and 17, are effective January 1, 
 67.26  2003, in the first and sixth judicial districts, January 1, 
 67.27  2004, in the third and fourth judicial districts, and January 1, 
 67.28  2005, in the second and tenth judicial districts. 
 67.29                             ARTICLE 5
 67.30                LOCAL GOVERNMENT SALES TAX EXEMPTION
 67.31     Section 1.  Minnesota Statutes 2000, section 297A.70, 
 67.32  subdivision 1, is amended to read: 
 67.33     Subdivision 1.  [SCOPE.] (a) The gross receipts from sales 
 67.34  of items to or by, and storage, distribution, use, or 
 67.35  consumption of items by the organizations listed in this section 
 67.36  are specifically exempted from the taxes imposed by this chapter.
 68.1      (b) Notwithstanding any law to the contrary enacted before 
 68.2   1992, only sales to governments and political subdivisions 
 68.3   listed in this section are exempt from the taxes imposed by this 
 68.4   chapter.  
 68.5      (c) "Sales" includes purchases under an installment 
 68.6   contract or lease purchase agreement under section 465.71. 
 68.7      [EFFECTIVE DATE.] This section is effective for sales and 
 68.8   purchases after June 30, 2001. 
 68.9      Sec. 2.  Minnesota Statutes 2000, section 297A.70, 
 68.10  subdivision 2, is amended to read: 
 68.11     Subd. 2.  [SALES TO GOVERNMENT.] (a) All sales, except 
 68.12  those listed in paragraph (b), to the following governments and 
 68.13  political subdivisions, or to the listed agencies or 
 68.14  instrumentalities of governments and political subdivisions, are 
 68.15  exempt: 
 68.16     (1) the United States and its agencies and 
 68.17  instrumentalities; 
 68.18     (2) school districts, the University of Minnesota, state 
 68.19  universities, community colleges, technical colleges, state 
 68.20  academies, and the Perpich Minnesota center for arts education, 
 68.21  and an instrumentality of a political subdivision that is 
 68.22  accredited as an optional/special function school by the North 
 68.23  Central Association of Colleges and Schools; 
 68.24     (3) hospitals and nursing homes owned and operated by 
 68.25  political subdivisions of the state political subdivisions of a 
 68.26  state and their agencies and instrumentalities; and 
 68.27     (4) other states or political subdivisions of other states, 
 68.28  if the sale would be exempt from taxation if it occurred in that 
 68.29  state; and 
 68.30     (5) sales to public libraries, public library systems, 
 68.31  multicounty, multitype library systems as defined in section 
 68.32  134.001, county law libraries under chapter 134A, state agency 
 68.33  libraries, the state library under section 480.09, and the 
 68.34  legislative reference library.  
 68.35     (b) This exemption does not apply to the sales of the 
 68.36  following products and services: 
 69.1      (1) building, construction, or reconstruction materials 
 69.2   purchased by a contractor or a subcontractor as a part of a 
 69.3   lump-sum contract or similar type of contract with a guaranteed 
 69.4   maximum price covering both labor and materials for use in the 
 69.5   construction, alteration, or repair of a building or facility; 
 69.6      (2) construction materials purchased by tax exempt entities 
 69.7   or their contractors to be used in constructing buildings or 
 69.8   facilities which will not be used principally by the tax exempt 
 69.9   entities; 
 69.10     (3) the leasing of a motor vehicle as defined in section 
 69.11  297B.01, subdivision 5, except for: 
 69.12     (i) leases entered into by the United States or its 
 69.13  agencies or instrumentalities; or 
 69.14     (ii) leases entered into by a political subdivision of 
 69.15  motor vehicles exempt from tax under chapter 297B; or 
 69.16     (4) meals and lodging as defined under section 297A.61, 
 69.17  subdivisions 3, paragraph (d), and 16, paragraph (c), except for 
 69.18  meals and lodging purchased directly by the United States or its 
 69.19  agencies or instrumentalities. 
 69.20     (c) As used in this subdivision, "school districts" means 
 69.21  public school entities and districts of every kind and nature 
 69.22  organized under the laws of the state of Minnesota, and any 
 69.23  instrumentality of a school district, as defined in section 
 69.24  471.59. 
 69.25     [EFFECTIVE DATE.] This section is effective for sales and 
 69.26  purchases after June 30, 2001. 
 69.27     Sec. 3.  Minnesota Statutes 2000, section 297A.70, 
 69.28  subdivision 3, is amended to read: 
 69.29     Subd. 3.  [SALES OF CERTAIN GOODS AND SERVICES TO 
 69.30  GOVERNMENT.] (a) The following sales to or use by the 
 69.31  specified persons, governments, and political subdivisions of 
 69.32  the state are exempt: 
 69.33     (1) supplies and equipment used to provide medical care in 
 69.34  the operation of an ambulance service owned and operated by a 
 69.35  political subdivision of the state; 
 69.36     (2) repair and replacement parts for emergency rescue 
 70.1   vehicles, fire trucks, and fire apparatus to a political 
 70.2   subdivision; 
 70.3      (3) machinery and equipment, except for motor vehicles, 
 70.4   used directly for mixed municipal solid waste management 
 70.5   services at a solid waste disposal facility as defined in 
 70.6   section 115A.03, subdivision 10; 
 70.7      (4) chore and homemaking services to a political 
 70.8   subdivision of the state to be provided to elderly or disabled 
 70.9   individuals; 
 70.10     (5) telephone services to the department of administration 
 70.11  that are used to provide telecommunications services through the 
 70.12  intertechnologies revolving fund; 
 70.13     (6) (2) firefighter personal protective equipment as 
 70.14  defined in paragraph (b), if purchased or authorized by and for 
 70.15  the use of an organized fire department, fire protection 
 70.16  district, or fire company regularly charged with the 
 70.17  responsibility of providing fire protection to the state or a 
 70.18  political subdivision; 
 70.19     (7) (3) bullet-resistant body armor that provides the 
 70.20  wearer with ballistic and trauma protection, if purchased by a 
 70.21  law enforcement agency of the state or a political subdivision 
 70.22  of the state, or a licensed peace officer, as defined in section 
 70.23  626.84, subdivision 1; and 
 70.24     (8) (4) motor vehicles purchased or leased by political 
 70.25  subdivisions of the state if the vehicles are exempt from 
 70.26  registration under section 168.012, subdivision 1, paragraph 
 70.27  (b), or exempt from taxation under section 473.448; 
 70.28     (9) equipment designed to process, dewater, and recycle 
 70.29  biosolids for wastewater treatment facilities of political 
 70.30  subdivisions, and materials incidental to installation of that 
 70.31  equipment; and materials used to construct buildings to house 
 70.32  the equipment, if the materials are purchased after June 30, 
 70.33  1998, and before July 1, 2001; and 
 70.34     (10) sales to a town of gravel and of machinery, equipment, 
 70.35  and accessories, except motor vehicles, used exclusively for 
 70.36  road and bridge maintenance, and leases by a town of motor 
 71.1   vehicles exempt from tax under section 297B.03, clause (10). 
 71.2      (b) For purposes of this subdivision, "firefighters 
 71.3   personal protective equipment" means helmets, including face 
 71.4   shields, chin straps, and neck liners; bunker coats and pants, 
 71.5   including pant suspenders; boots; gloves; head covers or hoods; 
 71.6   wildfire jackets; protective coveralls; goggles; self-contained 
 71.7   breathing apparatus; canister filter masks; personal alert 
 71.8   safety systems; spanner belts; optical or thermal imaging search 
 71.9   devices; and all safety equipment required by the Occupational 
 71.10  Safety and Health Administration. 
 71.11     [EFFECTIVE DATE.] This section is effective for sales and 
 71.12  purchases after June 30, 2001. 
 71.13     Sec. 4.  Minnesota Statutes 2000, section 297A.991, 
 71.14  subdivision 2, is amended to read: 
 71.15     Subd. 2.  [COMMISSIONER OF FINANCE TO REPORT.] In reporting 
 71.16  the sales tax and sales tax on motor vehicles collections to the 
 71.17  United States Department of Commerce, the commissioner of 
 71.18  finance shall exclude the estimated amount from the sales and 
 71.19  motor vehicle collections.  Sales tax and Sales tax on motor 
 71.20  vehicles revenues received from political subdivisions must be 
 71.21  reported as intergovernmental grants or similar 
 71.22  intergovernmental revenue.  The amount of the sales tax and 
 71.23  sales tax on motor vehicles paid by state agencies must be 
 71.24  reported as reduced state expenditures. 
 71.25     [EFFECTIVE DATE.] This section is effective for sales and 
 71.26  purchases after June 30, 2001.