SF 2555

1st Engrossment - 91st Legislature (2019 - 2020) Posted on 04/25/2019 09:50am

A bill for an act
relating to taxation; making various policy and technical changes to individual
income and corporate franchise taxes, sales and use taxes, special taxes, property
taxes, gross revenues taxes, fire and police state aid, and other miscellaneous taxes
and tax provisions; amending Minnesota Statutes 2018, sections 6.495, subdivision
3; 144E.42, subdivision 2; 162.145, subdivision 3; 270B.08, subdivision 2; 270C.85,
subdivision 2; 270C.89, subdivisions 1, 2; 270C.91; 272.02, subdivisions 27, 81;
273.032; 273.061, subdivision 9; 273.0755; 273.113, subdivision 3; 273.119,
subdivision 2; 273.1231, subdivision 3; 273.124, subdivision 13; 273.13,
subdivisions 22, 34; 273.136, subdivision 2; 273.1384, subdivision 3; 273.1387,
subdivision 3; 273.18; 274.14; 274.16; 275.025, subdivision 1; 289A.08,
subdivision 6; 289A.25, subdivision 1; 289A.31, subdivision 2; 289A.37,
subdivision 6; 289A.38, subdivision 7; 290.0132, subdivision 26; 290.0137; 290.06,
subdivisions 2c, 2d; 290.0802, subdivisions 2, 3; 290.091, subdivision 2; 290.92,
subdivision 28; 290A.03, subdivisions 3, 4, 8; 290A.05; 290A.08; 290A.09;
290B.09, subdivision 1; 295.50, subdivisions 3, 4, 9b, 14, 15, by adding
subdivisions; 295.53, subdivision 1; 295.57, subdivision 5; 295.582, subdivision
1; 297A.61, subdivision 18; 297A.67, subdivisions 6, 12; 297A.70, subdivisions
3, 4, 16; 297A.71, subdivision 22; 297A.75, subdivision 1; 297A.84; 297A.85;
297B.01, subdivisions 14, 16; 297F.01, subdivisions 19, 23, by adding a
subdivision; 297I.20, subdivision 3; 298.018, subdivision 1, by adding a
subdivision; 298.282, subdivision 1; 353G.01, subdivision 9; 353G.05, subdivision
2; 353G.08, subdivisions 1, 1a; 353G.17, subdivision 2; 356.20, subdivision 4a;
356.219, subdivision 8; 423A.02, subdivisions 1b, 3; 423A.022, subdivisions 2,
4; 424A.016, subdivisions 2, 4; 424A.02, subdivisions 1, 3a, 10; 424A.03,
subdivision 2; 424A.05, subdivisions 2, 3, by adding a subdivision; 424A.07;
424A.091, subdivision 3; 424A.092, subdivisions 3, 4; 424A.093, subdivision 5;
424B.09; 462D.03, subdivision 2; 469.177, subdivision 1; Laws 2017, First Special
Session chapter 1, article 8, section 3; proposing coding for new law in Minnesota
Statutes, chapters 297I; 424A; proposing coding for new law as Minnesota Statutes,
chapters 477B; 477C; repealing Minnesota Statutes 2018, sections 69.011,
subdivisions 1, 2, 2b, 2c, 3, 4; 69.021, subdivisions 1, 2, 3, 4, 5, 7, 7a, 8, 9, 10, 11;
69.022; 69.031, subdivisions 1, 3, 5; 69.041; 69.051, subdivisions 1, 1a, 1b, 2, 3,
4; 69.33; 69.80; 270C.131; 275.29; 297I.25, subdivision 2.

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

ARTICLE 1

DEPARTMENT OF REVENUE INDIVIDUAL INCOME AND CORPORATE
FRANCHISE TAXES: POLICY CHANGES

Section 1.

Minnesota Statutes 2018, section 290.0132, subdivision 26, is amended to read:

Subd. 26.

Social Security benefits.

(a) A portion of Social Security benefits is allowed
as a subtraction. The subtraction equals the lesser of Social Security benefits or a maximum
subtraction subject to the limits under paragraphs (b), (c), and (d).

(b) For married taxpayers filing a joint return and surviving spouses, the maximum
subtraction equals $4,500. The maximum subtraction is reduced by 20 percent of provisional
income over $77,000. In no case is the subtraction less than zero.

(c) For single or head-of-household taxpayers, the maximum subtraction equals $3,500.
The maximum subtraction is reduced by 20 percent of provisional income over $60,200.
In no case is the subtraction less than zero.

(d) For married taxpayers filing separate returns, the maximum subtraction equals deleted text begin $2,250 deleted text end new text begin
one-half the maximum subtraction for joint returns under paragraph (b) new text end . The maximum
subtraction is reduced by 20 percent of provisional income over deleted text begin $38,500 deleted text end new text begin one-half the
threshold amount specified in paragraph (b) new text end . In no case is the subtraction less than zero.

(e) For purposes of this subdivision, "provisional income" means modified adjusted
gross income as defined in section 86(b)(2) of the Internal Revenue Code, plus one-half of
the Social Security benefits received during the taxable year, and "Social Security benefits"
has the meaning given in section 86(d)(1) of the Internal Revenue Code.

(f) The commissioner shall adjust the maximum subtraction and threshold amounts in
paragraphs (b) to (d) by the percentage determined pursuant to the provisions of section
1(f) of the Internal Revenue Code, except that in section 1(f)(3)(B) of the Internal Revenue
Code the word "2016" shall be substituted for the word "1992." For 2018, the commissioner
shall then determine the percentage change from the 12 months ending on August 31, 2016,
to the 12 months ending on August 31, 2017, and in each subsequent year, from the 12
months ending on August 31, 2016, to the 12 months ending on August 31 of the year
preceding the taxable year. The determination of the commissioner pursuant to this
subdivision must not be considered a rule and is not subject to the Administrative Procedure
Act contained in chapter 14, including section 14.386. The maximum subtraction and
threshold amounts as adjusted must be rounded to the nearest $10 amount. If the amount
ends in $5, the amount is rounded up to the nearest $10 amount.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after December
31, 2018.
new text end

Sec. 2.

Minnesota Statutes 2018, section 290.0137, is amended to read:

290.0137 ACCELERATED RECOGNITION OF CERTAIN INSTALLMENT
SALE GAINS.

(a) In the case of a nonresident individual or a person who becomes a nonresident
individual during the tax year, taxable net income shall include the deleted text begin allocable deleted text end amount realized
upon a sale of the assets of, or any interest in, an S corporation or partnership that operated
in Minnesota during the year of sale, including any income or gain to be recognized in future
years pursuant to an installment sale method of reporting under the Internal Revenue Code.

(1) For the purposes of this paragraph, an individual who becomes a nonresident of
Minnesota in any year after an installment sale is required to recognize the full amount of
any income or gain described in this paragraph on the individual's final Minnesota resident
tax return to the extent that such income has not been recognized in a prior year.

(2) For the purposes of this section, "realized" has the meaning given in section 1001(b)
of the Internal Revenue Code.

(3) For the purposes of this section, "installment sale" means any installment sale under
section 453 of the Internal Revenue Code and any other sale that is reported utilizing a
method of accounting authorized under subchapter E of the Internal Revenue Code that
allows taxpayers to delay reporting or recognizing a realized gain until a future year.

deleted text begin (4) For the purposes of this section, "allocable amount" means the full amount to be
apportioned to Minnesota under section 290.191 or 290.20, or the full amount to be assigned
to Minnesota under section 290.17.
deleted text end

(b) Notwithstanding paragraph (a), nonresident taxpayers may elect to defer recognizing
unrecognized installment sale gains by making an election under this paragraph. The election
must be filed on a form to be determined or prescribed by the commissioner and must be
filed by the due date of the individual income tax return, including any extension. Electing
taxpayers must make an irrevocable agreement to:

(1) file Minnesota tax returns in all subsequent years when gains from the installment
sales are recognized and reported to the Internal Revenue Service;

(2) allocate gains to the state of Minnesota as though the gains were realized in the year
of sale under section 290.17, 290.191, or 290.20; and

(3) include all relevant federal tax documents reporting the installment sale with
subsequent Minnesota tax returns.

(c) Income or gain recognized for Minnesota purposes pursuant to paragraph (a) must
be excluded from taxable net income in any future year that the taxpayer files a Minnesota
tax return to the extent that the income or gain has already been subject to tax pursuant to
paragraph (a).

new text begin EFFECTIVE DATE. new text end

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

Sec. 3.

Minnesota Statutes 2018, section 290.06, subdivision 2c, is amended to read:

Subd. 2c.

Schedules of rates for individuals, estates, and trusts.

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

(1) On the first $35,480, 5.35 percent;

(2) On all over $35,480, but not over $140,960, 7.05 percent;

(3) On all over $140,960, but not over $250,000, 7.85 percent;

(4) On all over $250,000, 9.85 percent.

Married individuals filing separate returns, estates, and trusts must compute their income
tax by applying the above rates to their taxable income, except that the income brackets
will be one-half of the above amounts new text begin after the adjustment required in subdivision 2d new text end .

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

(1) On the first $24,270, 5.35 percent;

(2) On all over $24,270, but not over $79,730, 7.05 percent;

(3) On all over $79,730, but not over $150,000, 7.85 percent;

(4) On all over $150,000, 9.85 percent.

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

(1) On the first $29,880, 5.35 percent;

(2) On all over $29,880, but not over $120,070, 7.05 percent;

(3) On all over $120,070, but not over $200,000, 7.85 percent;

(4) On all over $200,000, 9.85 percent.

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

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

(1) the numerator is the individual's Minnesota source federal adjusted gross income as
defined in section 62 of the Internal Revenue Code and increased by new text begin :
new text end

new text begin (i) new text end the additions required under deleted text begin section deleted text end new text begin sections new text end 290.0131, subdivisions 2 and 6 to 11, new text begin
and 290.0137, paragraph (a); new text end and reduced by

new text begin (ii) new text end the Minnesota assignable portion of the subtraction for United States government
interest under section 290.0132, subdivision 2, deleted text begin and deleted text end the subtractions under deleted text begin section deleted text end new text begin sections new text end
290.0132, subdivisions 9, 10, 14, 15, 17, and 18 new text begin , and 290.0137, paragraph (c) new text end , after applying
the allocation and assignability provisions of section 290.081, clause (a), or 290.17; and

(2) the denominator is the individual's federal adjusted gross income as defined in section
62 of the Internal Revenue Code, increased by new text begin :
new text end

new text begin (i) new text end the deleted text begin amounts specified in section deleted text end new text begin additions required under sections new text end 290.0131,
subdivisions 2 and 6 to 11, new text begin and 290.0137, paragraph (a); new text end and reduced by

new text begin (ii) new text end the deleted text begin amounts specified in section deleted text end new text begin subtractions under sections new text end 290.0132, subdivisions
2, 9, 10, 14, 15, 17, and 18 new text begin , and 290.0137, paragraph (c) new text end .

new text begin EFFECTIVE DATE. new text end

new text begin The amendment to paragraph (a) is effective for taxable years
beginning after December 31, 2018. The amendment to paragraph (e) is effective the day
following final enactment.
new text end

Sec. 4.

Minnesota Statutes 2018, section 290.06, subdivision 2d, is amended to read:

Subd. 2d.

Inflation adjustment of brackets.

(a) For taxable years beginning after
December 31, 2013, the minimum and maximum dollar amounts for each rate bracket for
which a tax is imposed in subdivision 2c shall be adjusted for inflation by the percentage
determined under paragraph (b). For the purpose of making the adjustment as provided in
this subdivision all of the rate brackets provided in subdivision 2c shall be the rate brackets
as they existed for taxable years beginning after December 31, 2012, and before January 1,
2014. The rate applicable to any rate bracket must not be changed. The dollar amounts
setting forth the tax shall be adjusted to reflect the changes in the rate brackets. The rate
brackets as adjusted must be rounded to the nearest $10 amount. If the rate bracket ends in
$5, it must be rounded up to the nearest $10 amount.

(b) The commissioner shall adjust the rate brackets and by the percentage determined
pursuant to the provisions of section 1(f) of the Internal Revenue Code, except that in section
1(f)(3)(B) the word "2012" shall be substituted for the word "1992." For 2014, the
commissioner shall then determine the percent change from the 12 months ending on August
31, 2012, to the 12 months ending on August 31, 2013, and in each subsequent year, from
the 12 months ending on August 31, 2012, to the 12 months ending on August 31 of the
year preceding the taxable year. new text begin The commissioner shall determine the rate bracket for
married filing separate returns after this adjustment is done. The rate bracket for married
filing separate must be one-half of the rate bracket for married filing joint. new text end The determination
of the commissioner pursuant to this subdivision shall not be considered a "rule" and shall
not be subject to the Administrative Procedure Act contained in chapter 14.

No later than December 15 of each year, the commissioner shall announce the specific
percentage that will be used to adjust the tax rate brackets.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after December
31, 2018.
new text end

ARTICLE 2

DEPARTMENT OF REVENUE INDIVIDUAL INCOME AND CORPORATE
FRANCHISE TAXES: TECHNICAL CHANGES

Section 1.

Minnesota Statutes 2018, section 289A.38, subdivision 7, is amended to read:

Subd. 7.

Federal tax changes.

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

new text begin (b) For the purposes of paragraph (a), a change or correction includes any case where a
taxpayer reaches a closing agreement or compromise with the Internal Revenue Service
under section 7121 or 7122 of the Internal Revenue Code.
new text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 2.

Minnesota Statutes 2018, section 290.92, subdivision 28, is amended to read:

Subd. 28.

Payments to horse racing license holders.

Effective with payments made
after April 1, 1988, any holder of a license issued by the Minnesota Racing Commission
who makes a payment for personal or professional services to a holder of a class C license
issued by the commission, except an amount paid as a purse, shall deduct from the payment
and withhold 6.25 percent of the amount as Minnesota withholding tax when the amount
paid to that individual by the same person during the calendar year exceeds $600. For
purposes of the provisions of this section, a payment to any person which is subject to
withholding under this subdivision must be treated as if the payment was a wage paid by
an employer to an employee. Every individual who is to receive a payment which is subject
to withholding under this subdivision shall furnish the license holder with a statement, made
under the penalties of perjury, containing the name, address, and Social Security account
number of the person receiving the payment. No withholding is required if the individual
presents a signed certificate from the individual's employer which states that the individual
is an employee of that employer. A nonresident individual who holds a class C license must
be treated as an athlete for purposes of applying the provisions of subdivision 4a and section
290.17, subdivision 2 deleted text begin (1)(b)(ii) deleted text end new text begin (a)(2)(ii) new text end .

new text begin EFFECTIVE DATE. new text end

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

Sec. 3.

Minnesota Statutes 2018, section 462D.03, subdivision 2, is amended to read:

Subd. 2.

Designation of qualified beneficiary.

(a) The account holder must designate
a first-time home buyer as the qualified beneficiary of the account deleted text begin by April 15 of the year deleted text end new text begin
in a form and manner prescribed by the commissioner new text end following the taxable year in which
the account was established. The account holder may be the qualified beneficiary. The
account holder may change the designated qualified beneficiary at any time, but no more
than one qualified beneficiary may be designated for an account at any one time. For purposes
of the one beneficiary restriction, a married couple qualifies as one beneficiary. Changing
the designated qualified beneficiary of an account does not affect computation of the ten-year
period under section 462D.06, subdivision 2.

(b) The commissioner shall establish a process for account holders to notify the state
that permits recording of the account, the account holder or holders, any transfers under
section 462D.04, subdivision 2, and the designated qualified beneficiary for each account.
This may be done upon filing the account holder's income tax return or in any other way
the commissioner determines to be appropriate.

new text begin EFFECTIVE DATE. new text end

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

ARTICLE 3

DEPARTMENT OF REVENUE; TOBACCO TAXES; TECHNICAL CHANGES

Section 1.

Minnesota Statutes 2018, section 297F.01, subdivision 19, is amended to read:

Subd. 19.

Tobacco products.

(a) "Tobacco products" means any product containing,
made, or derived from tobacco that is intended for human consumption, whether chewed,
smoked, absorbed, dissolved, inhaled, snorted, sniffed, or ingested by any other means, or
any component, part, or accessory of a tobacco product, including, but not limited to, cigars;
cheroots; stogies; periques; granulated, plug cut, crimp cut, ready rubbed, and other smoking
tobacco; snuff; snuff flour; cavendish; plug and twist tobacco; fine-cut and other chewing
tobacco; shorts; refuse scraps, clippings, cuttings and sweepings of tobacco, and other kinds
and forms of tobacco; but does not include cigarettes as defined in this section. new text begin Tobacco
products includes nicotine solution products. new text end Tobacco products excludes any tobacco product
that has been approved by the United States Food and Drug Administration for sale as a
tobacco cessation product, as a tobacco dependence product, or for other medical purposes,
and is being marketed and sold solely for such an approved purpose.

(b) Except for the imposition of tax under section 297F.05, subdivisions 3 and 4, tobacco
products includes a premium cigar, as defined in subdivision 13a.

new text begin EFFECTIVE DATE. new text end

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

Sec. 2.

Minnesota Statutes 2018, section 297F.01, is amended by adding a subdivision to
read:

new text begin Subd. 22b. new text end

new text begin Nicotine solution products. new text end

new text begin (a) "Nicotine solution products" means any
cartridge, bottle, or other package that contains nicotine made or derived from tobacco, that
is in a solution that is consumed, or meant to be consumed, through the use of a heating
element, power source, electronic circuit, or other electronic, chemical, or mechanical means
that produces vapor or aerosol. This paragraph expires December 31, 2019.
new text end

new text begin (b) Beginning January 1, 2020, "nicotine solution products" means any cartridge, bottle,
or other package that contains nicotine, including nicotine made or derived from tobacco
or sources other than tobacco, that is in a solution that is consumed, or meant to be consumed,
through the use of a heating element, power source, electronic circuit, or other electronic,
chemical, or mechanical means that produces vapor or aerosol.
new text end

new text begin (c) Nicotine solution products includes any electronic cigarette, electronic cigar, electronic
cigarillo, electronic pipe, or similar product or device, and any batteries, heating elements,
or other components, parts, or accessories sold with and meant to be used in the consumption
of a solution containing nicotine.
new text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 3.

Minnesota Statutes 2018, section 297F.01, subdivision 23, is amended to read:

Subd. 23.

Wholesale sales price.

new text begin (a) new text end "Wholesale sales price" means the price at which
a distributor purchases a tobacco product.

new text begin (b) When a distributor sells a cartridge, bottle, or other package of a solution containing
nicotine that is part of a kit that also includes a product, device, component, part, or accessory
described in subdivision 22b:
new text end

new text begin (1) the wholesale sales price is the price at which the distributor purchases the kit; except
that
new text end

new text begin (2) if the distributor also separately sells the same package of solution containing nicotine
that is sold with the kit and can isolate the cost of the package of solution containing nicotine,
then the wholesale sales price includes only the price at which the distributor separately
purchases the package of the solution containing nicotine and any taxes, charges, and costs
listed in paragraph (c).
new text end

new text begin (c) new text end Wholesale sales price includes the applicable federal excise tax, freight charges, or
packaging costs, regardless of whether they were included in the purchase price.

new text begin EFFECTIVE DATE. new text end

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

ARTICLE 4

MINNESOTACARE; TECHNICAL CHANGES

Section 1.

Minnesota Statutes 2018, section 295.50, is amended by adding a subdivision
to read:

new text begin Subd. 2b. new text end

new text begin Emergency medical reasons. new text end

new text begin "Emergency medical reasons" means a public
health emergency declaration pursuant to United States Code, title 42, section 247d; a
national security or peacetime emergency declared by the governor pursuant to section
12.31; or a situation involving an action by the commissioner of health pursuant to section
144.4197, 144.4198, or 151.37, subdivisions 2, paragraph (b), and 10, except that, for
purposes of this subdivision, a drug shortage not caused by a public health emergency shall
not constitute an emergency medical reason.
new text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 2.

Minnesota Statutes 2018, section 295.50, subdivision 3, is amended to read:

Subd. 3.

Gross revenues.

"Gross revenues" are total amounts received in money or
otherwise by:

(1) a hospital for patient services;

(2) a surgical center for patient services;

(3) a health care provider, other than a staff model health deleted text begin carrier deleted text end new text begin plan company new text end , for
patient services;

(4) a wholesale drug distributor for sale or distribution of legend drugs that are delivered
in Minnesota by the wholesale drug distributor, by common carrier, or by mail, unless the
legend drugs are delivered to another wholesale drug distributor who sells legend drugs
exclusively at wholesale deleted text begin . Legend drugs do not include nutritional products as defined in
Minnesota Rules, part 9505.0325, and blood and blood components deleted text end ; and

(5) a staff model health plan company as gross premiums for enrollees, co-payments,
deductibles, coinsurance, and fees for patient services.

new text begin EFFECTIVE DATE. new text end

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

Sec. 3.

Minnesota Statutes 2018, section 295.50, subdivision 4, is amended to read:

Subd. 4.

Health care provider.

(a) "Health care provider" means:

(1) a person whose health care occupation is regulated or required to be regulated by
the state of Minnesota furnishing any or all of the following goods or services directly to a
patient or consumer: medical, surgical, optical, visual, dental, hearing, nursing services,
drugs, laboratory, diagnostic or therapeutic services;

(2) a person who provides goods and services not listed in clause (1) that qualify for
reimbursement under the medical assistance program provided under chapter 256B;

(3) a staff model health plan company;

(4) an ambulance service required to be licensed; deleted text begin or
deleted text end

(5) a person who sells or repairs hearing aids and related equipment or prescription
eyewear deleted text begin . deleted text end new text begin ; or
new text end

new text begin (6) a person providing patient services, who does not otherwise meet the definition of
health care provider and is not specifically excluded in clause (b), who employs or contracts
with a health care provider as defined in clauses (1) to (5) to perform, supervise, otherwise
oversee, or consult with regarding patient services.
new text end

(b) Health care provider does not include:

(1) hospitals; medical supplies distributors, except as specified under paragraph (a),
clause (5); nursing homes licensed under chapter 144A or licensed in any other jurisdiction;
wholesale drug distributors; pharmacies; surgical centers; bus and taxicab transportation,
or any other providers of transportation services other than ambulance services required to
be licensed; supervised living facilities for persons with developmental disabilities, licensed
under Minnesota Rules, parts 4665.0100 to 4665.9900; housing with services establishments
required to be registered under chapter 144D; board and lodging establishments providing
only custodial services that are licensed under chapter 157 and registered under section
157.17 to provide supportive services or health supervision services; adult foster homes as
defined in Minnesota Rules, part 9555.5105; day training and habilitation services for adults
with developmental disabilities as defined in section 252.41, subdivision 3; boarding care
homes, as defined in Minnesota Rules, part 4655.0100; and adult day care centers as defined
in Minnesota Rules, part 9555.9600;

(2) home health agencies as defined in Minnesota Rules, part 9505.0175, subpart 15; a
person providing personal care services and supervision of personal care services as defined
in Minnesota Rules, part 9505.0335; a person providing home care nursing services as
defined in Minnesota Rules, part 9505.0360; and home care providers required to be licensed
under chapter 144A new text begin for home care services provided under chapter 144A new text end ;

(3) a person who employs health care providers solely for the purpose of providing
patient services to its employees;

(4) an educational institution that employs health care providers solely for the purpose
of providing patient services to its students if the institution does not receive fee for service
payments or payments for extended coverage; and

(5) a person who receives all payments for patient services from health care providers,
surgical centers, or hospitals for goods and services that are taxable to the paying health
care providers, surgical centers, or hospitals, as provided under section 295.53, subdivision
1, new text begin paragraph (b), new text end clause (3) or (4), or from a source of funds that is exempt from tax under
this chapter.

new text begin EFFECTIVE DATE. new text end

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

Sec. 4.

Minnesota Statutes 2018, section 295.50, is amended by adding a subdivision to
read:

new text begin Subd. 7a. new text end

new text begin Manufacturer. new text end

new text begin "Manufacturer" has the meaning provided in section 151.01,
subdivision 14a.
new text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 5.

Minnesota Statutes 2018, section 295.50, subdivision 9b, is amended to read:

Subd. 9b.

Patient services.

(a) "Patient services" means inpatient and outpatient services
and other goods and services provided by hospitals, surgical centers, or health care providers.
They include the following health care goods and services provided to a patient or consumer:

(1) bed and board;

(2) nursing services and other related services;

(3) use of hospitals, surgical centers, or health care provider facilities;

(4) medical social services;

(5) drugs, biologicals, supplies, appliances, and equipment;

(6) other diagnostic or therapeutic items or services;

(7) medical or surgical services;

(8) items and services furnished to ambulatory patients not requiring emergency care;
and

(9) emergency services.

(b) "Patient services" does not include:

(1) services provided to nursing homes licensed under chapter 144A;

(2) examinations for purposes of utilization reviews, insurance claims or eligibility,
litigation, and employment, including reviews of medical records for those purposes;

(3) services provided to and by community residential mental health facilities licensed
under Minnesota Rules, parts 9520.0500 to 9520.0670, and to and by residential treatment
programs for children with severe emotional disturbance licensed or certified under chapter
245A;

(4) services provided deleted text begin to and by community support programs and family community
support programs approved under Minnesota Rules, parts 9535.1700 to 9535.1760, or
certified as mental health rehabilitative services under chapter 256B; deleted text end new text begin under the following
programs: day treatment services as defined in section 245.462, subdivision 8; assertive
community treatment as described in section 256B.0622; adult rehabilitative mental health
services as described in section 256B.0623; adult crisis response services as described in
section 256B.0624; children's therapeutic services and supports as described in section
256B.0943; and children's mental health crisis response services as described in section
256B.0944;
new text end

(5) services provided to and by community mental health centers as defined in section
245.62, subdivision 2;

(6) services provided to and by assisted living programs and congregate housing
programs;

(7) hospice care services;

(8) home and community-based waivered services under sections 256B.0915, 256B.49,
and 256B.501;

(9) targeted case management services under sections 256B.0621; 256B.0625,
subdivisions 20, 20a, 33, and 44; and 256B.094; and

(10) services provided to the following: supervised living facilities for persons with
developmental disabilities licensed under Minnesota Rules, parts 4665.0100 to 4665.9900;
housing with services establishments required to be registered under chapter 144D; board
and lodging establishments providing only custodial services that are licensed under chapter
157 and registered under section 157.17 to provide supportive services or health supervision
services; adult foster homes as defined in Minnesota Rules, part 9555.5105; day training
and habilitation services for adults with developmental disabilities as defined in section
252.41, subdivision 3; boarding care homes as defined in Minnesota Rules, part 4655.0100;
adult day care services as defined in section 245A.02, subdivision 2a; and home health
agencies as defined in Minnesota Rules, part 9505.0175, subpart 15, or licensed under
chapter 144A.

new text begin EFFECTIVE DATE. new text end

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

Sec. 6.

Minnesota Statutes 2018, section 295.50, is amended by adding a subdivision to
read:

new text begin Subd. 10c. new text end

new text begin Pharmacy benefits manager. new text end

new text begin "Pharmacy benefits manager" means an entity
that performs pharmacy benefits management.
new text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 7.

Minnesota Statutes 2018, section 295.50, is amended by adding a subdivision to
read:

new text begin Subd. 13a. new text end

new text begin Third-party purchaser of health care services. new text end

new text begin "Third-party purchaser of
health care services" includes but is not limited to a health carrier or community integrated
service network that pays for health care services on behalf of patients or that reimburses,
indemnifies, compensates, or otherwise insures patients for health care services.
new text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 8.

Minnesota Statutes 2018, section 295.50, subdivision 14, is amended to read:

Subd. 14.

Wholesale drug distributor.

"Wholesale drug distributor" means deleted text begin a wholesale
drug distributor required to be licensed under sections 151.42 to 151.51. deleted text end new text begin any person engaged
in wholesale drug distribution including but not limited to manufacturers; repackagers;
own-label distributors; jobbers; brokers; warehouses, including manufacturers' and
distributors' warehouses, chain drug warehouses, and wholesale drug warehouses;
independent wholesale drug traders; and pharmacies that conduct wholesale drug distribution.
A wholesale drug distributor does not include a common carrier or individual hired primarily
to transport legend drugs.
new text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 9.

Minnesota Statutes 2018, section 295.50, subdivision 15, is amended to read:

Subd. 15.

Legend drug.

"Legend drug" means a drug that is required by federal law to
bear one of the following statements: "Caution: Federal law prohibits dispensing without
prescription" or "Rx only." new text begin Legend drugs do not include nutritional products as defined in
Minnesota Rules, part 9505.0325, subpart 1, and blood and blood components.
new text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 10.

Minnesota Statutes 2018, section 295.50, is amended by adding a subdivision to
read:

new text begin Subd. 16. new text end

new text begin Wholesale drug distribution. new text end

new text begin "Wholesale drug distribution" means the sale
or distribution of legend drugs to a person other than a consumer or patient, but does not
include:
new text end

new text begin (1) a sale between a division, subsidiary, parent, affiliated, or related company under
the common ownership and control of a corporate entity;
new text end

new text begin (2) the purchase or other acquisition, by a hospital or other health care entity that is a
member of a group purchasing organization, of a legend drug for its own use from the
organization or from other hospitals or health care entities that are members of such
organizations;
new text end

new text begin (3) the sale, purchase, or trade of a legend drug by a charitable organization described
in section 501(c)(3) of the Internal Revenue Code of 1986, as amended through December
31, 1988, to a nonprofit affiliate of the organization to the extent otherwise permitted by
law;
new text end

new text begin (4) the sale, purchase, or trade of a legend drug among hospitals or other health care
entities that are under common control;
new text end

new text begin (5) the sale, purchase, or trade of a legend drug for emergency medical reasons;
new text end

new text begin (6) the transfer of legend drugs by a retail pharmacy to another retail pharmacy to alleviate
a temporary shortage; or
new text end

new text begin (7) the distribution of legend drug samples by manufacturer representatives.
new text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 11.

Minnesota Statutes 2018, section 295.53, subdivision 1, is amended to read:

Subdivision 1.

new text begin Exclusions and new text end Exemptions.

(a) The following payments are excluded
from the gross revenues subject to the hospital, surgical center, or health care provider taxes
under sections 295.50 to 295.59:

deleted text begin (1) payments received for services provided under the Medicare program, including
payments received from the government, and organizations governed by sections 1833 and
1876 of title XVIII of the federal Social Security Act, United States Code, title 42, section
1395, and enrollee deductibles, coinsurance, and co-payments, whether paid by the Medicare
enrollee or by a Medicare supplemental coverage as defined in section 62A.011, subdivision
3, clause (10), or by Medicaid payments under title XIX of the federal Social Security Act.
Payments for services not covered by Medicare are taxable;
deleted text end

deleted text begin (2) payments received for home health care services;
deleted text end

deleted text begin (3) payments received from hospitals or surgical centers for goods and services on which
liability for tax is imposed under section 295.52 or the source of funds for the payment is
exempt under clause (1), (7), (10), or (14);
deleted text end

deleted text begin (4) payments received from health care providers for goods and services on which
liability for tax is imposed under this chapter or the source of funds for the payment is
exempt under clause (1), (7), (10), or (14);
deleted text end

deleted text begin (5) amounts paid for legend drugs, other than nutritional products and blood and blood
components, to a wholesale drug distributor who is subject to tax under section 295.52,
subdivision 3, reduced by reimbursements received for legend drugs otherwise exempt
under this chapter;
deleted text end

deleted text begin (6) deleted text end new text begin (1) new text end payments received by a health care provider or the wholly owned subsidiary of
a health care provider for care provided outside Minnesota;

deleted text begin (7) payments received from the chemical dependency fund under chapter 254B;
deleted text end

deleted text begin (8) payments received in the nature of charitable donations that are not designated for
providing patient services to a specific individual or group;
deleted text end

deleted text begin (9) payments received for providing patient services incurred through a formal program
of health care research conducted in conformity with federal regulations governing research
on human subjects. Payments received from patients or from other persons paying on behalf
of the patients are subject to tax;
deleted text end

deleted text begin (10) payments received from any governmental agency for services benefiting the public,
not including payments made by the government in its capacity as an employer or insurer
or payments made by the government for services provided under the MinnesotaCare
program or the medical assistance program governed by title XIX of the federal Social
Security Act, United States Code, title 42, sections 1396 to 1396v;
deleted text end

deleted text begin (11) deleted text end new text begin (2) new text end government payments received by the commissioner of human services for
state-operated services;

deleted text begin (12) deleted text end new text begin (3) new text end payments received by a health care provider for hearing aids and related
equipment or prescription eyewear delivered outside of Minnesota; new text begin and
new text end

deleted text begin (13) deleted text end new text begin (4) new text end payments received by an educational institution from student tuition, student
activity fees, health care service fees, government appropriations, donations, or grants, and
for services identified in and provided under an individualized education program as defined
in section 256B.0625 or Code of Federal Regulations, chapter 34, section 300.340(a). Fee
for service payments and payments for extended coverage are taxable deleted text begin ; deleted text end new text begin .
new text end

deleted text begin (14) payments received under the federal Employees Health Benefits Act, United States
Code, title 5, section 8909(f), as amended by the Omnibus Reconciliation Act of 1990.
Enrollee deductibles, coinsurance, and co-payments are subject to tax; and
deleted text end

deleted text begin (15) payments received under the federal Tricare program, Code of Federal Regulations,
title 32, section 199.17(a)(7). Enrollee deductibles, coinsurance, and co-payments are subject
to tax.
deleted text end

new text begin (b) The following payments are exempted from the gross revenues subject to hospital,
surgical center, or health care provider taxes under sections 295.50 to 295.59:
new text end

new text begin (1) payments received for services provided under the Medicare program, including
payments received from the government and organizations governed by sections 1833,
1853, and 1876 of title XVIII of the federal Social Security Act, United States Code, title
42, section 1395; and enrollee deductibles, co-insurance, and co-payments, whether paid
by the Medicare enrollee, by Medicare supplemental coverage as described in section
62A.011, subdivision 3, clause (10), or by Medicaid payments under title XIX of the federal
Social Security Act. Payments for services not covered by Medicare are taxable;
new text end

new text begin (2) payments received for home health care services;
new text end

new text begin (3) payments received from hospitals or surgical centers for goods and services on which
liability for tax is imposed under section 295.52 or the source of funds for the payment is
exempt under clauses (1), (6), (9), (10), or (11);
new text end

new text begin (4) payments received from the health care providers for goods and services on which
liability for tax is imposed under this chapter or the source of funds for the payment is
exempt under clause (1), (6), (9), (10), or (11);
new text end

new text begin (5) amounts paid for legend drugs to a wholesale drug distributor who is subject to tax
under section 295.52, subdivision 3, reduced by reimbursement received for legend drugs
otherwise exempt under this chapter;
new text end

new text begin (6) payments received from the chemical dependency fund under chapter 254B;
new text end

new text begin (7) payments received in the nature of charitable donations that are not designated for
providing patient services to a specific individual or group;
new text end

new text begin (8) payments received for providing patient services incurred through a formal program
of health care research conducted in conformity with federal regulations governing research
on human subjects. Payments received from patients or from other persons paying on behalf
of the patients are subject to tax;
new text end

new text begin (9) payments received from any governmental agency for services benefiting the public,
not including payments made by the government in its capacity as an employer or insurer
or payments made by the government for services provided under the MinnesotaCare
program or the medical assistance program governed by title XIX of the federal Social
Security Act, United States Code, title 42, section 1396 to 1396v;
new text end

new text begin (10) payments received under the federal Employees Health Benefits Act, United States
Code, title 5, section 8909(f), as amended by the Omnibus Reconciliation Act of 1990.
Enrollee deductibles, co-insurance, and co-payments are subject to tax;
new text end

new text begin (11) payments received under the federal Tricare program, Code of Federal Regulations,
title 32, section 199.17(a)(7). Enrollee deductibles, co-insurance, and co-payments are
subject to tax; and
new text end

new text begin (12) supplemental or enhanced payments authorized under section 256B.196 or 256B.197.
new text end

deleted text begin (b) deleted text end new text begin new text end new text begin (c) new text end Payments received by wholesale drug distributors for legend drugs sold directly
to veterinarians or veterinary bulk purchasing organizations are excluded from the gross
revenues subject to the wholesale drug distributor tax under sections 295.50 to 295.59.

deleted text begin (c) Supplemental or enhanced payments authorized under section 256B.19, subdivision
1c, 256B.196, or 256B.197 are excluded from gross revenues subject to the tax under sections
295.50 to 295.59.
deleted text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 12.

Minnesota Statutes 2018, section 295.57, subdivision 5, is amended to read:

Subd. 5.

Exemption for amounts paid for legend drugs.

If a hospital, surgical center,
or health care provider cannot determine the actual cost or reimbursement of legend drugs
under the exemption provided in section 295.53, subdivision 1, paragraph deleted text begin (a) deleted text end new text begin (b) new text end , clause
(5), the following method must be used:

A hospital, surgical center, or health care provider must determine the amount paid for
legend drugs used during the month or quarter and multiply that amount by a ratio, the
numerator of which is the total amount received for taxable patient services, and the
denominator of which is the total amount received for all patient services, including amounts
exempt under section 295.53, subdivision 1 new text begin , paragraph (b) new text end . The result represents the allowable
exemption for the monthly or quarterly cost of drugs.

new text begin EFFECTIVE DATE. new text end

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

Sec. 13.

Minnesota Statutes 2018, section 295.582, subdivision 1, is amended to read:

Subdivision 1.

Tax expense transfer.

deleted text begin (a) A hospital, surgical center, or health care
provider that is subject to a tax under section 295.52, or a pharmacy that has paid additional
expense transferred under this section by a wholesale drug distributor, may transfer additional
expense generated by section 295.52 obligations on to all third-party contracts for the
purchase of health care services on behalf of a patient or consumer. Nothing shall prohibit
a pharmacy from transferring the additional expense generated under section 295.52 to a
pharmacy benefits manager. The additional expense transferred to the third-party purchaser
or a pharmacy benefits manager must not exceed the tax percentage specified in section
295.52 multiplied against the gross revenues received under the third-party contract, and
the tax percentage specified in section 295.52 multiplied against co-payments and deductibles
paid by the individual patient or consumer. The expense must not be generated on revenues
derived from payments that are excluded from the tax under section 295.53. All third-party
purchasers of health care services including, but not limited to, third-party purchasers
regulated under chapter 60A, 62A, 62C, 62D, 62H, 62N, 64B, 65A, 65B, 79, or 79A, or
under section 471.61 or 471.617, and pharmacy benefits managers must pay the transferred
expense in addition to any payments due under existing contracts with the hospital, surgical
center, pharmacy, or health care provider, to the extent allowed under federal law. A
third-party purchaser of health care services includes, but is not limited to, a health carrier
or community integrated service network that pays for health care services on behalf of
patients or that reimburses, indemnifies, compensates, or otherwise insures patients for
health care services. For purposes of this section, a pharmacy benefits manager means an
entity that performs pharmacy benefits management. A third-party purchaser or pharmacy
benefits manager shall comply with this section regardless of whether the third-party
purchaser or pharmacy benefits manager is a for-profit, not-for-profit, or nonprofit entity.
A wholesale drug distributor may transfer additional expense generated by section 295.52
obligations to entities that purchase from the wholesaler, and the entities must pay the
additional expense. Nothing in this section limits the ability of a hospital, surgical center,
pharmacy, wholesale drug distributor, or health care provider to recover all or part of the
section 295.52 obligation by other methods, including increasing fees or charges.
deleted text end

new text begin (a) The tax expense generated by section 295.52 may be transferred as follows:
new text end

new text begin (1) a hospital, surgical center, or health care provider subject to the tax under section
295.52 may transfer the tax expense to all third-party contracts for the purchase of health
care services on behalf of a patient or consumer;
new text end

new text begin (2) a wholesale drug distributor subject to the tax under section 295.52 may transfer the
tax expense to entities that purchase legend drugs from the wholesale drug distributor; and
new text end

new text begin (3) a pharmacy that has paid the tax expense transferred by a wholesale drug distributor
may transfer the tax expense to all third-party contracts for the purchase of health care
services on behalf of a patient or consumer. Nothing shall prohibit a pharmacy from
transferring the tax expense generated under section 295.52 to a pharmacy benefits manager.
new text end

new text begin (b) The transfer of the tax expense under paragraph (a) must comply with the following:
new text end

new text begin (1) the tax expense transferred to the third-party purchaser or a pharmacy benefits
manager must not exceed the tax percentage specified in section 295.52 multiplied against:
new text end

new text begin (i) gross revenues received under the third-party contract; and
new text end

new text begin (ii) co-payments and deductibles paid by the individual patient or consumer; and
new text end

new text begin (2) the tax expense must not be generated on revenues derived from payments that are
excluded or exempted from the tax under section 295.53.
new text end

new text begin (c) Payment of the transferred tax expense is required as follows:
new text end

new text begin (1) all third-party purchasers of health care services, including but not limited to
third-party purchasers regulated under chapter 60A, 62A, 62C, 62D, 62H, 62N, 64B, 65A,
65B, 79, or 79A, or under section 471.61 or 471.617, and pharmacy benefits managers must
pay the transferred expense. This is in addition to any payments due under existing contracts
with the hospital, surgical center, pharmacy, or health care provider, to the extent allowed
under federal law; and
new text end

new text begin (2) all entities that purchase legend drugs from a wholesale drug distributor must pay
the transferred expense.
new text end

new text begin (d) A third-party purchaser or pharmacy benefits manager must comply with this section
regardless of whether the third-party purchaser or pharmacy benefits manager is a for-profit,
not-for-profit, or nonprofit entity.
new text end

new text begin (e) Nothing in this section limits the ability of a hospital, surgical center, health care
provider, pharmacy, or wholesale drug distributor to recover all or part of the section 295.52
obligation by other methods, including increasing fees or charges.
new text end

deleted text begin (b) deleted text end new text begin new text end new text begin (f) new text end Any hospital, surgical center, or health care provider subject to a tax under section
295.52 or a pharmacy that has paid new text begin the new text end additional expense transferred under this section by
a wholesale drug distributor may file a complaint with the commissioner responsible for
regulating the third-party purchaser if at any time the third-party purchaser fails to comply
with deleted text begin paragraph (a) deleted text end new text begin this section new text end .

deleted text begin (c) deleted text end new text begin (g) new text end If the commissioner responsible for regulating the third-party purchaser finds at
any time that the third-party purchaser has not complied with deleted text begin paragraph (a) deleted text end new text begin this section new text end , the
commissioner may take enforcement action against a third-party purchaser which is subject
to the commissioner's regulatory jurisdiction and which does not allow a hospital, surgical
center, pharmacy, or provider to pass-through the tax new text begin expense new text end . The commissioner may by
order fine or censure the third-party purchaser or revoke or suspend the certificate of authority
or license of the third-party purchaser to do business in this state if the commissioner finds
that the third-party purchaser has not complied with this section. The third-party purchaser
may appeal the commissioner's order through a contested case hearing in accordance with
chapter 14.

new text begin EFFECTIVE DATE. new text end

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

ARTICLE 5

PROPERTY TAX POLICY

Section 1.

Minnesota Statutes 2018, section 162.145, subdivision 3, is amended to read:

Subd. 3.

Administration.

(a) Subject to funds made available by law, the commissioner
shall allocate all funds as provided in subdivision 4 and shall deleted text begin notify deleted text end new text begin , by June 1, certify to new text end
the commissioner of revenue new text begin the amounts to be paid new text end .

(b) Following deleted text begin notification deleted text end new text begin certification new text end from the commissioner deleted text begin of transportation deleted text end , the
commissioner of revenue shall distribute the specified funds to cities in the same manner
as local government aid under chapter 477A. An appropriation to the commissioner deleted text begin of
transportation deleted text end under this section is available to the commissioner of revenue for the purposes
specified in this paragraph.

(c) Notwithstanding other law to the contrary, in order to receive distributions under
this section, a city must conform to the standards in section 477A.017, subdivision 2. A city
that receives funds under this section must make and preserve records necessary to show
that the funds are spent in compliance with subdivision 4.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2019 and thereafter.
new text end

Sec. 2.

Minnesota Statutes 2018, section 273.124, subdivision 13, is amended to read:

Subd. 13.

Homestead application.

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

(b) The commissioner shall prescribe the content, format, and manner of the homestead
application required to be filed under this chapter pursuant to section 270C.30. The
application must clearly inform the taxpayer that this application must be signed by all
owners who occupy the property or by the qualifying relative and returned to the county
assessor in order for the property to receive homestead treatment.

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

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

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

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

(e) The homestead application shall also notify the property owners that if the property
is granted homestead status for any assessment year, that same property shall remain
classified as homestead until the property is sold or transferred to another person, or the
owners, the spouse of the owner, or the relatives no longer use the property as their
homestead. Upon the sale or transfer of the homestead property, a certificate of value must
be timely filed with the county auditor as provided under section 272.115. Failure to notify
the assessor within 30 days that the property has been sold, transferred, or that the owner,
the spouse of the owner, or the relative is no longer occupying the property as a homestead,
shall result in the penalty provided under this subdivision and the property will lose its
current homestead status.

(f) If a homestead application has not been filed with the county by December 15, the
assessor shall classify the property as nonhomestead for the current assessment year for
taxes payable in the following year, provided that the owner may be entitled to receive the
homestead classification by proper application under section 375.192.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for applications for homestead filed in
2020 and thereafter.
new text end

ARTICLE 6

DEPARTMENT OF REVENUE; PROPERTY TAXES; TECHNICAL CHANGES

Section 1.

Minnesota Statutes 2018, section 270C.85, subdivision 2, is amended to read:

Subd. 2.

Powers and duties.

The commissioner shall have and exercise the following
powers and duties in administering the property tax laws deleted text begin . deleted text end new text begin :
new text end

deleted text begin (a) deleted text end new text begin (1) new text end confer with, advise, and give the necessary instructions and directions to local
assessors and local boards of review throughout the state as to their duties under the laws
of the state deleted text begin . deleted text end new text begin ;
new text end

deleted text begin (b) deleted text end new text begin (2) new text end direct proceedings, actions, and prosecutions to be instituted to enforce the laws
relating to the liability and punishment of public officers and officers and agents of
corporations for failure or negligence to comply with the provisions of the property tax
laws, and cause complaints to be made against local assessors, members of boards of
equalization, members of boards of review, or any other assessing or taxing officer, to the
proper authority, for their removal from office for misconduct or negligence of duty deleted text begin . deleted text end new text begin ;
new text end

deleted text begin (c) deleted text end new text begin (3) new text end require county attorneys to assist in the commencement of prosecutions in actions
or proceedings for removal, forfeiture, and punishment, for violation of the property tax
laws in their respective districts or counties deleted text begin . deleted text end new text begin ;
new text end

deleted text begin (d) deleted text end new text begin (4) new text end require town, city, county, and other public officers to report new text begin and certify
new text end information new text begin , at the parcel level or in the aggregate, new text end as to the assessment new text begin and taxation new text end of new text begin real
and personal new text end property, and such other information as may be needful in the work of the
commissioner deleted text begin , in such form as the commissioner may prescribe deleted text end . new text begin The commissioner shall
prescribe the content, format, manner, and time of filing of all required reports and
certifications;
new text end

deleted text begin (e) deleted text end new text begin (5) new text end transmit to the governor, on or before the third Monday in December of each
even-numbered year, and to each member of the legislature, on or before November 15 of
each even-numbered year, the report of the department for the preceding years, showing all
the taxable property subject to the property tax laws and the value of the same, in tabulated
form deleted text begin . deleted text end new text begin ;
new text end

deleted text begin (f) deleted text end new text begin (6) new text end inquire into the methods of assessment and taxation and ascertain whether the
assessors faithfully discharge their duties deleted text begin . deleted text end new text begin ; and
new text end

deleted text begin (g) deleted text end new text begin (7) new text end assist local assessors in determining the estimated market value of industrial
special-use property. For purposes of this deleted text begin paragraph deleted text end new text begin clause new text end , "industrial special-use property"
means property that:

deleted text begin (1) deleted text end new text begin (i) new text end is designed and equipped for a particular type of industry;

deleted text begin (2) deleted text end new text begin (ii) new text end is not easily adapted to some other use due to the unique nature of the facilities;

deleted text begin (3) deleted text end new text begin (iii) new text end has facilities totaling at least 75,000 square feet in size; and

deleted text begin (4) deleted text end new text begin (iv) new text end has a total estimated market value of $10,000,000 or greater based on the
assessor's preliminary determination.

new text begin EFFECTIVE DATE. new text end

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

Sec. 2.

Minnesota Statutes 2018, section 270C.89, subdivision 1, is amended to read:

Subdivision 1.

Initial report.

Each county assessor shall file deleted text begin by April 1 deleted text end with the
commissioner a copy of deleted text begin the abstract deleted text end new text begin preliminary assessment information that the
commissioner may require under section 270C.85, subdivision 2, clause (4), new text end that will be
acted upon by the local and county boards of review. deleted text begin The abstract must list the real and
personal property in the county itemized by assessment districts. deleted text end The assessor of each county
in the state shall file with the commissioner, within ten working days following final action
of the local board of review or equalization and within five days following final action of
the county board of equalization, any changes made by the local or county board. deleted text begin The
information must be filed in the manner prescribed by the commissioner.
deleted text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 3.

Minnesota Statutes 2018, section 270C.89, subdivision 2, is amended to read:

Subd. 2.

Final report.

The final deleted text begin abstract of assessments deleted text end new text begin assessment information new text end after
adjustments by the State Board of Equalization and inclusion of any omitted property shall
be deleted text begin submitted deleted text end new text begin reported new text end to the commissioner deleted text begin on or before September 1 of each calendar year deleted text end new text begin
under section 270C.85, subdivision 2, clause (4) new text end . deleted text begin The final abstract must separately report
the captured tax capacity of tax increment financing districts under section 469.177,
subdivision 2, the areawide net tax capacity contribution values determined under sections
276A.05, subdivision 1, and 473F.07, subdivision 1, and the value subject to the power line
credit under section 273.42.
deleted text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 4.

Minnesota Statutes 2018, section 270C.91, is amended to read:

270C.91 RECORD OF PROCEEDINGS CHANGING NET TAX CAPACITY;
DUTIES OF COUNTY AUDITOR.

A record of all proceedings of the commissioner affecting any change in the net tax
capacity of any property, as revised by the State Board of Equalization, shall be kept by the
commissioner and a copy thereof, duly certified, shall be mailed each year to the auditor of
each county wherein such property is situated, on or before June 30 deleted text begin or 30 days after
submission of the abstract required by section 270C.89, whichever is later deleted text end . This record shall
specify the amounts or amount, or both, added to or deducted from the net tax capacity of
the real property of each of the several towns and cities, and of the real property not in towns
or cities, also the percent or amount of both, added to or deducted from the several classes
of personal property in each of the towns and cities, and also the amount added to or deducted
from the assessment of any person. The county auditor shall add to or deduct from such
tract or lot, or portion thereof, of any real property in the county the required percent or
amount, or both, on the net tax capacity thereof as it stood after equalized by the county
board, adding in each case a fractional sum of 50 cents or more, and deducting in each case
any fractional sum of less than 50 cents, so that no net tax capacity of any separate tract or
lot shall contain any fraction of a dollar; and add to, or deduct from, the several classes of
personal property in the county the required percent or amount, or both, on the net tax
capacity thereof as it stood after equalized by the county board, adding or deducting in
manner aforesaid any fractional sum so that no net tax capacity of any separate class of
personal property shall contain a fraction of a dollar, and add to or deduct from assessment
of any person, as they stood after equalization by the county board, the required amounts
to agree with the assessments as returned by the commissioner.

new text begin EFFECTIVE DATE. new text end

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

Sec. 5.

Minnesota Statutes 2018, section 273.061, subdivision 9, is amended to read:

Subd. 9.

Additional general duties.

Additional duties of the county assessor deleted text begin shall be deleted text end new text begin
are new text end as follows:

(1) to make all assessments, based upon the appraised values reported by the local
assessors or assistants and the county assessor's own knowledge of the value of the property
assessed;

(2) to personally view and determine the value of any property deleted text begin which deleted text end new text begin that new text end because of
its type or character may be difficult for the local assessor to appraise;

(3) to make all changes ordered by the local boards of review, relative to the net tax
capacity of the property of any individual, firm or corporation after notice has been given
and hearings held as provided by law;

(4) to enter all assessments in the assessment books, furnished by the county auditor,
with each book and the tabular statements for each book in correct balance;

(5) to prepare all assessment cards, charts, maps and any other forms prescribed by the
commissioner of revenue;

(6) to attend the meeting of the county board of equalization; to investigate and report
on any assessment ordered by said board; to enter all changes made by said board in the
assessment books and prepare deleted text begin the abstract of assessments for the commissioner of revenue deleted text end new text begin
information reported to the commissioner under section 270C.85, subdivision 2, clause (4) new text end ;
to enter all changes made by the State Board of Equalization in the assessment books; to
deduct all exemptions authorized by law from each assessment and certify to the county
auditor the taxable value of each parcel of land, as described and listed in the assessment
books by the county auditor, and the taxable value of the personal property of each person,
firm, or corporation assessed;

(7) to investigate and make recommendations relative to all applications for the abatement
of taxes or applications for the reduction of the net tax capacity of any property; new text begin and
new text end

(8) to perform all other duties relating to the assessment of property for the purpose of
taxation which may be required by the commissioner of revenue.

new text begin EFFECTIVE DATE. new text end

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

Sec. 6.

Minnesota Statutes 2018, section 273.0755, is amended to read:

273.0755 TRAINING AND EDUCATION OF PROPERTY TAX PERSONNEL.

(a) Beginning with the four-year period starting on July 1, 2000, every person licensed
by the state Board of Assessors at the Accredited Minnesota Assessor level or higher, shall
successfully complete a weeklong Minnesota laws course sponsored by the Department of
Revenue at least once in every four-year period. An assessor need not attend the course if
they successfully pass the test for the course.

(b) The commissioner of revenue may require that each county, and each city for which
the city assessor performs the duties of county assessor, have deleted text begin (i) deleted text end new text begin (1) new text end a person on the assessor's
staff who is certified by the Department of Revenue in sales ratio calculations, deleted text begin (ii) deleted text end new text begin (2) new text end an
officer or employee who is certified by the Department of Revenue in tax calculations, and
deleted text begin (iii) deleted text end new text begin (3) new text end an officer or employee who is certified by the Department of Revenue in the proper
preparation of deleted text begin abstracts of assessment. The commissioner of revenue may require that each
county have an officer or employee who is certified by the Department of Revenue in the
proper preparation of abstracts of tax lists deleted text end new text begin information reported to the commissioner under
section 270C.85, subdivision 2, clause (4) new text end . Certifications under this paragraph expire after
four years.

(c) Beginning with the four-year educational licensing period starting on July 1, 2004,
every Minnesota assessor licensed by the State Board of Assessors must attend and participate
in a seminar that focuses on ethics, professional conduct and the need for standardized
assessment practices developed and presented by the commissioner of revenue. This
requirement must be met at least once in every subsequent four-year period. This requirement
applies to all assessors licensed for one year or more in the four-year period.

(d) When the commissioner of revenue determines that an individual or board that
performs functions related to property tax administration has performed those functions in
a manner that is not uniform or equitable, the commissioner may require that the individual
or members of the board complete supplemental training. The commissioner may not require
that an individual complete more than 32 hours of supplemental training pursuant to this
paragraph. If the individual is required to complete supplemental training due to that
individual's membership on a local or county board of appeal and equalization, the
commissioner may not require that the individual complete more than two hours of
supplemental training.

new text begin EFFECTIVE DATE. new text end

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

Sec. 7.

Minnesota Statutes 2018, section 273.113, subdivision 3, is amended to read:

Subd. 3.

Reimbursement for lost revenue.

The county auditor shall certify to the
commissioner of revenue deleted text begin , as part of the abstracts of tax lists required to be filed with the
commissioner deleted text end under section deleted text begin 275.29 deleted text end new text begin 270C.85, subdivision 2, clause (4) new text end , the amount of tax
lost to the county from the property tax credit under subdivision 2. Any prior year adjustments
must also be certified deleted text begin in the abstracts of tax lists deleted text end . The commissioner of revenue shall review
the certifications to determine their accuracy. The commissioner may make the changes in
the certification that are considered necessary or return a certification to the county auditor
for corrections. The commissioner shall reimburse each taxing district, other than school
districts, for the taxes lost. The payments must be made at the time provided in section
473H.10 for payment to taxing jurisdictions in the same proportion that the ad valorem tax
is distributed. Reimbursements to school districts must be made as provided in section
273.1392. The amount necessary to make the reimbursements under this section is annually
appropriated from the general fund to the commissioner of revenue.

new text begin EFFECTIVE DATE. new text end

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

Sec. 8.

Minnesota Statutes 2018, section 273.119, subdivision 2, is amended to read:

Subd. 2.

Reimbursement for lost revenue.

The county may transfer money from the
county conservation account created in section 40A.152 to the county revenue fund to
reimburse the fund for the cost of the property tax credit. The county auditor shall certify
to the commissioner of revenue deleted text begin , as part of the abstracts of tax lists required to be filed with
the commissioner deleted text end under section deleted text begin 275.29 deleted text end new text begin 270C.85, subdivision 2, clause (4) new text end , the amount of
tax lost to the county from the property tax credit under subdivision 1 and the extent that
the tax lost exceeds funds available in the county conservation account. Any prior year
adjustments must also be certified deleted text begin in the abstracts of tax lists deleted text end . The commissioner of revenue
shall review the certifications to determine their accuracy. The commissioner may make
the changes in the certification that are considered necessary or return a certification to the
county auditor for corrections. The commissioner shall reimburse each taxing district, other
than school districts, from the Minnesota conservation fund under section 40A.151 for the
taxes lost in excess of the county account. The payments must be made at the time provided
in section 473H.10, subdivision 3, for payment to taxing jurisdictions in the same proportion
that the ad valorem tax is distributed.

new text begin EFFECTIVE DATE. new text end

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

Sec. 9.

Minnesota Statutes 2018, section 273.1231, subdivision 3, is amended to read:

Subd. 3.

Disaster or emergency area.

(a) "Disaster or emergency area" means a
geographic area for which:

(1)(i) the president of the United States, the secretary of agriculture, or the administrator
of the Small Business Administration has determined that a disaster exists pursuant to federal
law, or

(ii) a local emergency has been declared pursuant to section 12.29; and

(2) an application by the local unit of government requesting property tax relief under
this section has been received by the governor and approved by the executive council.

(b) The executive council must not approve an application unless:

(1) a completed disaster survey is included; and

(2) within the boundaries of the applicant, (i) the average damage for the buildings that
are damaged is at least $5,000, and (ii) either at least 25 taxable buildings were damaged,
or the total dollar amount of damage to all taxable buildings equals or exceeds one percent
of the total taxable market value of buildings for the applicant as reported to the commissioner
of revenue under section deleted text begin 270C.89, subdivision 2 deleted text end new text begin 270C.85, subdivision 2, clause (4) new text end , for the
assessment in the year prior to the year of the damage.

new text begin EFFECTIVE DATE. new text end

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

Sec. 10.

Minnesota Statutes 2018, section 273.136, subdivision 2, is amended to read:

Subd. 2.

Reduction amounts submitted to county.

The commissioner of revenue shall
determine, not later than April 1 of each year, the amount of reduction resulting from section
273.135 in each county containing a tax relief area as defined by section 273.134, paragraph
(b), basing determinations on a review of deleted text begin abstracts of tax lists submitted by the county
auditors pursuant to section 275.29 deleted text end new text begin information reported to the commissioner under section
270C.85, subdivision 2, clause (4) new text end . The commissioner may make changes deleted text begin in the abstracts
of tax lists deleted text end as deemed necessary. The commissioner of revenue, after such review, shall
submit to the St. Louis County auditor, on or before April 15, the amount of the first half
payment payable hereunder and on or before September 15 the amount of the second half
payment.

new text begin EFFECTIVE DATE. new text end

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

Sec. 11.

Minnesota Statutes 2018, section 273.1384, subdivision 3, is amended to read:

Subd. 3.

Credit reimbursements.

The county auditor shall determine the tax reductions
allowed under subdivision 2 within the county for each taxes payable year and shall certify
that amount to the commissioner of revenue deleted text begin as a part of the abstracts of tax lists submitted
by the county auditors under section 275.29 deleted text end new text begin under section 270C.85, subdivision 2, clause
(4) new text end . Any prior year adjustments shall also be certified deleted text begin on the abstracts of tax lists deleted text end . The
commissioner shall review the certifications for accuracy, and may make such changes as
are deemed necessary, or return the certification to the county auditor for correction. The
credit under this section must be used to proportionately reduce the net tax capacity-based
property tax payable to each local taxing jurisdiction as provided in section 273.1393.

new text begin EFFECTIVE DATE. new text end

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

Sec. 12.

Minnesota Statutes 2018, section 273.1387, subdivision 3, is amended to read:

Subd. 3.

Credit reimbursements.

The county auditor shall determine the tax reductions
allowed under this section within the county for each taxes payable year and shall certify
that amount to the commissioner of revenue deleted text begin as a part of the abstracts of tax lists submitted
under section 275.29 deleted text end new text begin under section 270C.85, subdivision 2, clause (4) new text end . Any prior year
adjustments shall also be certified deleted text begin on the abstracts of tax lists deleted text end . The commissioner shall
review the certifications for accuracy, and may make such changes as are deemed necessary,
or return the certification to the county auditor for correction. The credit under this section
must be used to reduce the school district net tax capacity-based property tax as provided
in section 273.1393.

new text begin EFFECTIVE DATE. new text end

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

Sec. 13.

Minnesota Statutes 2018, section 273.18, is amended to read:

273.18 LISTING, VALUATION, AND ASSESSMENT OF EXEMPT PROPERTY
BY COUNTY AUDITORS.

(a) In every sixth year after the year 2010, the county auditor shall enter the description
of each tract of real property exempt by law from taxation, with the name of the owner, and
the assessor shall value and assess the same in the same manner that other real property is
valued and assessed, and shall designate in each case the purpose for which the property is
used.

(b) deleted text begin For purposes of the apportionment of fire state aid under section 69.021, subdivision
7, deleted text end The county auditor shall include deleted text begin on the abstract of assessment of exempt real property
filed under this section deleted text end new text begin in the exempt property information that the commissioner may
require under section 270C.85, subdivision 2, clause (4) new text end , the total number of acres of all
natural resources lands for which in lieu payments are made under sections 477A.11 to
477A.14. The assessor shall estimate its market value, provided that if the assessor is not
able to estimate the market value of the land on a per parcel basis, the assessor shall furnish
the commissioner of revenue with an estimate of the average value per acre of this land
within the county.

new text begin EFFECTIVE DATE. new text end

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

Sec. 14.

Minnesota Statutes 2018, section 274.14, is amended to read:

274.14 LENGTH OF SESSION; RECORD.

The board must meet after the second Friday in June on at least one meeting day and
may meet for up to ten consecutive meeting days. The actual meeting dates must be contained
on the valuation notices mailed to each property owner in the county as provided in section
273.121. For this purpose, "meeting days" is defined as any day of the week excluding
Sunday. At the board's discretion, "meeting days" may include Saturday. No action taken
by the county board of review after June 30 is valid, except for corrections permitted in
sections 273.01 and 274.01. The county auditor shall keep an accurate record of the
proceedings and orders of the board. The record must be published like other proceedings
of county commissioners. A copy of the published record must be sent to the commissioner
of revenue deleted text begin , with the abstract of assessment required by section 274.16 deleted text end new text begin within five days
following final action of the county board of equalization new text end .

For counties that conduct either regular board of review meetings or open book meetings,
at least one of the meeting days must include a meeting that does not end before 7:00 p.m.
For counties that require taxpayer appointments for the board of review, appointments must
include some available times that extend until at least 7:00 p.m. The county may have a
Saturday meeting in lieu of, or in addition to, the extended meeting times under this
paragraph.

new text begin EFFECTIVE DATE. new text end

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

Sec. 15.

Minnesota Statutes 2018, section 274.16, is amended to read:

274.16 CORRECTED LISTS deleted text begin , ABSTRACTS deleted text end .

The county assessor or, in Ramsey County, the official designated by the board of county
commissioners shall calculate the changes of the assessment lists determined by the county
board of equalization, and make corrections accordingly, in the real or personal lists, or
both, and shall make deleted text begin duplicate abstracts deleted text end new text begin duplicates new text end of them. One must be filed in the assessor's
office, and one must be forwarded to the commissioner of revenue as provided in section
270C.89.

new text begin EFFECTIVE DATE. new text end

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

Sec. 16.

Minnesota Statutes 2018, section 275.025, subdivision 1, is amended to read:

Subdivision 1.

Levy amount.

The state general levy is levied against
commercial-industrial property and seasonal residential recreational property, as defined
in this section. The state general levy for commercial-industrial property is $784,590,000
for taxes payable in 2018 and thereafter. The state general levy for seasonal-recreational
property is $44,190,000 for taxes payable in 2018 and thereafter. The tax under this section
is not treated as a local tax rate under section 469.177 and is not the levy of a governmental
unit under chapters 276A and 473F.

The commissioner shall increase or decrease the preliminary or final rate for a year as
necessary to account for errors and tax base changes that affected a preliminary or final rate
for either of the two preceding years. Adjustments are allowed to the extent that the necessary
information is available to the commissioner at the time the rates for a year must be certified,
and for the following reasons:

(1) an erroneous report of taxable value by a local official;

(2) an erroneous calculation by the commissioner; and

(3) an increase or decrease in taxable value for commercial-industrial or seasonal
residential recreational property reported deleted text begin on the abstracts of tax lists submitted under section
275.29 that was not reported on the abstracts of assessment submitted under section 270C.89 deleted text end new text begin
to the commissioner under section 270C.85, subdivision 2, clause (4), new text end for the same year.

The commissioner may, but need not, make adjustments if the total difference in the tax
levied for the year would be less than $100,000.

new text begin EFFECTIVE DATE. new text end

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

Sec. 17.

Minnesota Statutes 2018, section 290B.09, subdivision 1, is amended to read:

Subdivision 1.

Determination; payment.

The county auditor shall determine the total
current year's deferred amount of property tax under this chapter in the county, and deleted text begin submit deleted text end new text begin
report new text end those amounts deleted text begin as part of the abstracts of tax lists submitted by the county auditors
under section 275.29 deleted text end new text begin to the commissioner under section 270C.85, subdivision 2, clause (4) new text end .
The commissioner may make changes deleted text begin in the abstracts of tax lists deleted text end as deemed necessary. The
commissioner of revenue, after such review, shall pay the deferred amount of property tax
to each county treasurer on or before August 31.

The county treasurer shall distribute as part of the October settlement the funds received
as if they had been collected as a part of the property tax.

new text begin EFFECTIVE DATE. new text end

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

Sec. 18.

Minnesota Statutes 2018, section 469.177, subdivision 1, is amended to read:

Subdivision 1.

Original net tax capacity.

(a) Upon or after adoption of a tax increment
financing plan, the auditor of any county in which the district is situated shall, upon request
of the authority, certify the original net tax capacity of the tax increment financing district
and that portion of the district overlying any subdistrict as described in the tax increment
financing plan and shall certify in each year thereafter the amount by which the original net
tax capacity has increased or decreased as a result of a change in tax exempt status of
property within the district and any subdistrict, reduction or enlargement of the district or
changes pursuant to subdivision 4. The auditor shall certify the amount within 30 days after
receipt of the request and sufficient information to identify the parcels included in the district.
The certification relates to the taxes payable year as provided in subdivision 6.

(b) If the classification under section 273.13 of property located in a district changes to
a classification that has a different assessment ratio, the original net tax capacity of that
property must be redetermined at the time when its use is changed as if the property had
originally been classified in the same class in which it is classified after its use is changed.

(c) The amount to be added to the original net tax capacity of the district as a result of
previously tax exempt real property within the district becoming taxable equals the net tax
capacity of the real property as most recently assessed pursuant to deleted text begin section 273.18 deleted text end new text begin information
reported to the commissioner under section 270C.85, subdivision 2, clause (4), new text end or, if that
assessment was made more than one year prior to the date of title transfer rendering the
property taxable, the net tax capacity assessed by the assessor at the time of the transfer. If
improvements are made to tax exempt property after the municipality approves the district
and before the parcel becomes taxable, the assessor shall, at the request of the authority,
separately assess the estimated market value of the improvements. If the property becomes
taxable, the county auditor shall add to original net tax capacity, the net tax capacity of the
parcel, excluding the separately assessed improvements. If substantial taxable improvements
were made to a parcel after certification of the district and if the property later becomes tax
exempt, in whole or part, as a result of the authority acquiring the property through
foreclosure or exercise of remedies under a lease or other revenue agreement or as a result
of tax forfeiture, the amount to be added to the original net tax capacity of the district as a
result of the property again becoming taxable is the amount of the parcel's value that was
included in original net tax capacity when the parcel was first certified. The amount to be
added to the original net tax capacity of the district as a result of enlargements equals the
net tax capacity of the added real property as most recently certified by the commissioner
of revenue as of the date of modification of the tax increment financing plan pursuant to
section 469.175, subdivision 4.

(d) If the net tax capacity of a property increases because the property no longer qualifies
under the Minnesota Agricultural Property Tax Law, section 273.111; the Minnesota Open
Space Property Tax Law, section 273.112; or the Metropolitan Agricultural Preserves Act,
chapter 473H, the Rural Preserve Property Tax Program under section 273.114, or because
platted, unimproved property is improved or market value is increased after approval of the
plat under section 273.11, subdivision 14a or 14b, the increase in net tax capacity must be
added to the original net tax capacity. If the net tax capacity of a property increases because
the property no longer qualifies for the homestead market value exclusion under section
273.13, subdivision 35, the increase in net tax capacity must be added to original net tax
capacity if the original construction of the affected home was completed before the date the
assessor certified the original net tax capacity of the district.

(e) The amount to be subtracted from the original net tax capacity of the district as a
result of previously taxable real property within the district becoming tax exempt or
qualifying in whole or part for an exclusion from taxable market value, or a reduction in
the geographic area of the district, shall be the amount of original net tax capacity initially
attributed to the property becoming tax exempt, being excluded from taxable market value,
or being removed from the district. If the net tax capacity of property located within the tax
increment financing district is reduced by reason of a court-ordered abatement, stipulation
agreement, voluntary abatement made by the assessor or auditor or by order of the
commissioner of revenue, the reduction shall be applied to the original net tax capacity of
the district when the property upon which the abatement is made has not been improved
since the date of certification of the district and to the captured net tax capacity of the district
in each year thereafter when the abatement relates to improvements made after the date of
certification. The county auditor may specify reasonable form and content of the request
for certification of the authority and any modification thereof pursuant to section 469.175,
subdivision 4.

(f) If a parcel of property contained a substandard building or improvements described
in section 469.174, subdivision 10, paragraph (e), that were demolished or removed and if
the authority elects to treat the parcel as occupied by a substandard building under section
469.174, subdivision 10, paragraph (b), or by improvements under section 469.174,
subdivision 10, paragraph (e), the auditor shall certify the original net tax capacity of the
parcel using the greater of (1) the current net tax capacity of the parcel, or (2) the estimated
market value of the parcel for the year in which the building or other improvements were
demolished or removed, but applying the classification rates for the current year.

(g) For a redevelopment district qualifying under section 469.174, subdivision 10,
paragraph (a), clause (4), as a qualified disaster area, the auditor shall certify the value of
the land as the original tax capacity for any parcel in the district that contains a building
that suffered substantial damage as a result of the disaster or emergency.

new text begin EFFECTIVE DATE. new text end

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

Sec. 19. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2018, section 275.29, new text end new text begin is repealed.
new text end

new text begin EFFECTIVE DATE. new text end

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

ARTICLE 7

FIRE STATE AID; TECHNICAL CHANGES

Section 1.

new text begin [477B.01] DEFINITIONS.
new text end

new text begin Subdivision 1. new text end

new text begin Scope. new text end

new text begin Unless the language or context clearly indicates that a different
meaning is intended, the following words and terms, for the purposes of this chapter and
chapters 423A and 424A, have the meanings given to them.
new text end

new text begin Subd. 2. new text end

new text begin Commissioner. new text end

new text begin "Commissioner" means the commissioner of revenue.
new text end

new text begin Subd. 3. new text end

new text begin Company or insurance company. new text end

new text begin "Company" or "insurance company" has
the meaning given in section 60A.02, subdivision 4.
new text end

new text begin Subd. 4. new text end

new text begin Estimated market value. new text end

new text begin "Estimated market value" has the meaning given in
section 272.03, subdivision 14.
new text end

new text begin Subd. 5. new text end

new text begin Fire department. new text end

new text begin "Fire department" includes a municipal fire department and
an independent nonprofit firefighting corporation.
new text end

new text begin Subd. 6. new text end

new text begin Fire department service area. new text end

new text begin "Fire department service area" means the area
serviced by a qualifying fire department that meets the requirements of section 477B.02.
new text end

new text begin Subd. 7. new text end

new text begin Independent nonprofit firefighting corporation. new text end

new text begin "Independent nonprofit
firefighting corporation" means an independent nonprofit firefighting corporation that meets
the criteria in section 424A.094, subdivision 1, paragraph (a).
new text end

new text begin Subd. 8. new text end

new text begin Minnesota Fire Premium Report. new text end

new text begin "Minnesota Fire Premium Report" means
a form for reporting by insurance companies of (1) gross direct fire, lightning, sprinkler
leakage, and extended coverage premiums received upon risks located or to be performed
in this state less return premiums and dividends, and (2) other facts that the commissioner
may require.
new text end

new text begin Subd. 9. new text end

new text begin Municipal clerk. new text end

new text begin "Municipal clerk" means the person elected or appointed to
the position of municipal clerk or, if there is no such person, the chief financial official, the
chief administrative official, or the person primarily responsible for managing the finances
of a municipality.
new text end

new text begin Subd. 10. new text end

new text begin Municipality. new text end

new text begin (a) "Municipality" means:
new text end

new text begin (1) a home rule charter or statutory city;
new text end

new text begin (2) an organized town;
new text end

new text begin (3) a park district subject to chapter 398;
new text end

new text begin (4) the University of Minnesota; and
new text end

new text begin (5) an American Indian tribal government entity located within a federally recognized
American Indian reservation.
new text end

new text begin (b) This subdivision only applies to chapter 477B.
new text end

new text begin Subd. 11. new text end

new text begin Secretary. new text end

new text begin "Secretary" means the secretary of an independent nonprofit
firefighting corporation that has a subsidiary incorporated firefighters' relief association or
whose firefighters participate in the voluntary statewide volunteer firefighter retirement
plan.
new text end

new text begin Subd. 12. new text end

new text begin Voluntary statewide volunteer firefighter retirement plan. new text end

new text begin "Voluntary
statewide volunteer firefighter retirement plan" means the retirement plan established under
chapter 353G.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 2.

new text begin [477B.02] QUALIFYING FOR FIRE STATE AID.
new text end

new text begin Subdivision 1. new text end

new text begin Qualifications for fire state aid. new text end

new text begin A municipality or independent nonprofit
firefighting corporation qualifies to receive fire state aid if all the requirements of this section
are met.
new text end

new text begin Subd. 2. new text end

new text begin Establishment of fire department. new text end

new text begin (a) An independent nonprofit firefighting
corporation must be created under the nonprofit corporation act of this state operating for
the exclusive purpose of firefighting, or the governing body of a municipality must officially
establish a fire department.
new text end

new text begin (b) The fire department must have provided firefighting services for at least one calendar
year.
new text end

new text begin Subd. 3. new text end

new text begin Personnel and benefits requirements. new text end

new text begin (a) A fire department must have a
minimum of ten paid or volunteer firefighters, including a fire chief and assistant fire chief.
new text end

new text begin (b) The fire department must have regular scheduled meetings and frequent drills that
include instructions in firefighting tactics and in the use, care, and operation of all fire
apparatus and equipment.
new text end

new text begin (c) The fire department must have a separate subsidiary incorporated firefighters' relief
association that provides retirement benefits or must participate in the voluntary statewide
volunteer firefighter retirement plan; or if the municipality solely employs full-time
firefighters as defined in section 299N.03, subdivision 5, retirement coverage must be
provided by the public employees police and fire retirement plan.
new text end

new text begin (d) Notwithstanding paragraph (c), a municipality without a relief association as described
under section 424A.08, paragraph (a), may still qualify to receive fire state aid if all other
requirements of this section are met.
new text end

new text begin Subd. 4. new text end

new text begin Equipment requirements. new text end

new text begin The fire department must have all of the following
equipment, or the equivalent as determined by the state fire marshal, by December 31 of
the year preceding the certification required in subdivision 8:
new text end

new text begin (1) a motorized fire truck equipped with:
new text end

new text begin (i) a motorized pump;
new text end

new text begin (ii) a 250-gallon or larger water tank;
new text end

new text begin (iii) 300 feet of one inch or larger fire hose in two lines with combination spray and
straight stream nozzles;
new text end

new text begin (iv) five-gallon hand pumps - tank extinguisher or equivalent;
new text end

new text begin (v) a dry chemical extinguisher or equivalent;
new text end

new text begin (vi) ladders;
new text end

new text begin (vii) extension ladders;
new text end

new text begin (viii) pike poles;
new text end

new text begin (ix) crowbars;
new text end

new text begin (x) axes;
new text end

new text begin (xi) lanterns; and
new text end

new text begin (xii) fire coats, helmets, and boots;
new text end

new text begin (2) the items in clause (1) suitably housed in a building of good construction with facilities
for care of hoses and equipment;
new text end

new text begin (3) a reliable and adequate method of receiving fire alarms by telephone or with electric
siren and suitable means of sounding an alarm; and
new text end

new text begin (4) if response is to be provided outside the corporate limits of the municipality where
the fire department is located, another piece of motorized apparatus to make the response.
new text end

new text begin Subd. 5. new text end

new text begin Fire service contract or agreement; apportionment agreement filing
requirement. new text end

new text begin (a) Every municipality or independent nonprofit firefighting corporation must
file a copy of any duly executed and valid fire service contract or agreement with the
commissioner.
new text end

new text begin (b) If more than one fire department provides service to a municipality, the fire
departments furnishing service must enter into an agreement apportioning among themselves
the percentage of the population and the percentage of the estimated market value of each
shared service fire department service area. The agreement must be in writing and must be
filed with the commissioner.
new text end

new text begin Subd. 6. new text end

new text begin Compliance with rules. new text end

new text begin The fire department must meet all other requirements
that the commissioner establishes by rule.
new text end

new text begin Subd. 7. new text end

new text begin Financial reporting requirements. new text end

new text begin The financial reporting requirements of
section 424A.014 must be satisfied.
new text end

new text begin Subd. 8. new text end

new text begin PERA certification to commissioner. new text end

new text begin On or before February 1 each year, if
retirement coverage for a fire department is provided by the voluntary statewide volunteer
firefighter retirement plan, the executive director of the Public Employees Retirement
Association must certify the existence of retirement coverage.
new text end

new text begin Subd. 9. new text end

new text begin Fire department certification to commissioner. new text end

new text begin On or before March 15 of
each year, the municipal clerk or the secretary, and the fire chief, must jointly certify to the
commissioner that the fire department exists and meets the qualification requirements of
this section. The certification must be on a form prescribed by the commissioner and must
include all other information that the commissioner requires.
new text end

new text begin Subd. 10. new text end

new text begin Penalty for failure to file certification. new text end

new text begin (a) If the certification under
subdivision 9 is not filed with the commissioner on or before March 15, the commissioner
must notify the municipal clerk or the secretary that a penalty equal to a portion or all of
the current year aid will apply if the certification is not received within ten days of the
postmark date of the notification.
new text end

new text begin (b) The penalty for failure to file the certification under subdivision 9 is equal to the
amount of fire state aid determined for the municipality or the independent nonprofit
firefighting corporation for the current year, multiplied by five percent for each week or
fraction of a week that the certification is late. The penalty must be computed beginning
ten days after the postmark date of the commissioner's notification. Aid amounts forfeited
as a result of the penalty revert to the state general fund. Failure to receive the certification
form is not a defense for a failure to file.
new text end

new text begin Subd. 11. new text end

new text begin Determination by commissioner. new text end

new text begin The commissioner must determine which
municipalities and independent nonprofit firefighting corporations are qualified to receive
fire state aid directly or are qualified to receive the benefit of fire state aid paid to the
voluntary statewide volunteer firefighter retirement plan based on compliance with the
requirements of this section and the financial compliance report required under section
6.495, subdivision 3, if applicable. The commissioner may take into account any other
relevant information that comes to the attention of the commissioner when making the
determination.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 3.

new text begin [477B.03] CALCULATION OF FIRE STATE AID; APPEAL.
new text end

new text begin Subdivision 1. new text end

new text begin Certification and calculation of fire state aid. new text end

new text begin (a) On or before October
l, the commissioner must calculate the amount of fire state aid that each municipality or
independent nonprofit firefighting corporation is to receive.
new text end

new text begin (b) The commissioner must calculate an initial fire state aid allocation amount for each
municipality or independent nonprofit firefighting corporation under subdivision 4 and, if
applicable, a minimum fire state aid allocation amount for each municipality or independent
nonprofit firefighting corporation under subdivision 5. The municipality or independent
nonprofit firefighting corporation must be apportioned the greater of the amounts calculated
under subdivisions 4 and 5.
new text end

new text begin Subd. 2. new text end

new text begin Apportionment of fire state aid. new text end

new text begin (a) The amount of fire state aid available for
apportionment, before the addition of the minimum fire state aid allocation amount under
subdivision 5, is equal to 107 percent of the amount of premium taxes paid to the state upon
the fire, lightning, sprinkler leakage, and extended coverage premiums reported to the
commissioner by companies or insurance companies on the Minnesota Fire Premium Report.
This amount must be reduced by the amount required to pay the state auditor's costs and
expenses of the audits or exams of the firefighters' relief associations.
new text end

new text begin (b) The total amount available for apportionment must not be less than two percent of
the premiums less return premiums reported to the commissioner by companies or insurance
companies on the Minnesota Fire Premium Report after subtracting the following amounts:
new text end

new text begin (1) the amount required to pay the state auditor's costs and expenses of the audits or
exams of the firefighters' relief associations; and
new text end

new text begin (2) one percent of the premiums reported by township mutual insurance companies and
mutual property and casualty companies with total assets of $5,000,000 or less.
new text end

new text begin (c) The commissioner must apportion the fire state aid to each municipality or independent
nonprofit firefighting corporation qualified under section 477B.02 relative to the premiums
reported on the Minnesota Fire Premium Reports filed under this chapter.
new text end

new text begin (d) The commissioner must calculate the percentage of increase or decrease reflected in
the apportionment over or under the previous year's available state aid using the same
premiums as a basis for comparison.
new text end

new text begin Subd. 3. new text end

new text begin Population and estimated market value. new text end

new text begin (a) Official statewide federal census
figures must be used in calculations requiring the use of population figures under this chapter.
Increases or decreases in population disclosed by reason of any special census must not be
taken into consideration.
new text end

new text begin (b) The latest available estimated market value property figures must be used in
calculations requiring the use of estimated market value property figures under this chapter.
new text end

new text begin Subd. 4. new text end

new text begin Initial fire state aid allocation amount. new text end

new text begin (a) The initial fire state aid allocation
amount is the amount available for apportionment as fire state aid under subdivision 2,
without the inclusion of any additional funding amount to support a minimum fire state aid
amount under section 423A.02, subdivision 3. The initial fire state aid allocation amount
is allocated one-half in proportion to the population for each fire department service area
and one-half in proportion to the estimated market value of each fire department service
area, including (1) the estimated market value of tax-exempt property, and (2) the estimated
market value of natural resources lands receiving in lieu payments under sections 477A.11
to 477A.14 and 477A.17. The estimated market value of minerals is excluded.
new text end

new text begin (b) In the case of a municipality or independent nonprofit firefighting corporation
furnishing fire protection to other municipalities as evidenced by valid fire service contracts
filed with the commissioner under section 477B.02, subdivision 5, the distribution must be
adjusted proportionately to take into consideration the crossover fire protection service.
Necessary adjustments must be made to subsequent apportionments.
new text end

new text begin (c) In the case of municipalities or independent nonprofit firefighting corporations
qualifying for aid, the commissioner must calculate the state aid for the municipality or
independent nonprofit firefighting corporation on the basis of the population and the estimated
market value of the area furnished fire protection service by the fire department as evidenced
by fire service agreements filed with the commissioner under section 477B.02, subdivision
5.
new text end

new text begin (d) In the case of more than one fire department furnishing contracted fire service to a
municipality, the population and estimated market value in the apportionment agreement
filed with the commissioner under section 477B.02, subdivision 5, must be used in calculating
the state aid.
new text end

new text begin Subd. 5. new text end

new text begin Minimum fire state aid allocation amount. new text end

new text begin (a) The minimum fire state aid
allocation amount is the amount derived from any additional funding amount to support a
minimum fire state aid amount under section 423A.02, subdivision 3. The minimum fire
state aid allocation amount is allocated to municipalities or independent nonprofit firefighting
corporations with volunteer firefighters' relief associations or covered by the voluntary
statewide volunteer firefighter retirement plan. The amount is based on the number of active
volunteer firefighters who are (1) members of the relief association as reported to the Office
of the State Auditor in a specific annual financial reporting year as specified in paragraphs
(b) to (d), or (2) covered by the voluntary statewide volunteer firefighter retirement plan as
specified in paragraph (e).
new text end

new text begin (b) For relief associations established in calendar year 1993 or a prior year, the number
of active volunteer firefighters equals the number of active volunteer firefighters who were
members of the relief association as reported in the annual financial reporting for calendar
year 1993, but not to exceed 30 active volunteer firefighters.
new text end

new text begin (c) For relief associations established in calendar year 1994 through calendar year 1999,
the number of active volunteer firefighters equals the number of active volunteer firefighters
who were members of the relief association as reported in the annual financial reporting for
calendar year 1998 to the Office of the State Auditor, but not to exceed 30 active volunteer
firefighters.
new text end

new text begin (d) For relief associations established after calendar year 1999, the number of active
volunteer firefighters equals the number of active volunteer firefighters who are members
of the relief association as reported in the first annual financial reporting submitted to the
Office of the State Auditor, but not to exceed 20 active volunteer firefighters.
new text end

new text begin (e) If a relief association is terminated as a result of providing retirement coverage for
volunteer firefighters by the voluntary statewide volunteer firefighter retirement plan under
chapter 353G, the number of active volunteer firefighters equals the number of active
volunteer firefighters of the municipality or independent nonprofit firefighting corporation
covered by the statewide plan as certified by the executive director of the Public Employees
Retirement Association to the commissioner and the state auditor, but not to exceed 30
active firefighters.
new text end

new text begin Subd. 6. new text end

new text begin Corrective aid adjustments. new text end

new text begin Any adjustments needed to correct prior
misallocations must be made to subsequent fire state aid apportionments.
new text end

new text begin Subd. 7. new text end

new text begin Appeal. new text end

new text begin A municipality, an independent nonprofit firefighting corporation, a
fire relief association, or the voluntary statewide volunteer firefighter retirement plan may
object to the amount of fire state aid apportioned to it by filing a written request with the
commissioner to review and adjust the apportionment of funds within the state. The decision
of the commissioner is subject to appeal, review, and adjustment by the district court in the
county in which the applicable municipality or independent nonprofit firefighting corporation
is located or by the Ramsey County District Court with respect to the voluntary statewide
volunteer firefighter retirement plan.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 4.

new text begin [477B.04] APPROPRIATION, PAYMENT, AND ADMINISTRATION.
new text end

new text begin Subdivision 1. new text end

new text begin Payments. new text end

new text begin (a) The commissioner must make payments to the Public
Employees Retirement Association for deposit in the voluntary statewide volunteer firefighter
retirement fund on behalf of a municipality or independent nonprofit firefighting corporation
that is a member of the voluntary statewide volunteer firefighter retirement plan under
chapter 353G, or directly to a municipality or county designated by an independent nonprofit
firefighting corporation. The payment is equal to the amount of fire state aid apportioned
to the applicable fire state aid recipient under section 477B.03.
new text end

new text begin (b) Fire state aid is payable on October 1 annually. The amount of state aid due and not
paid by October 1 accrues interest payable to the recipient at the rate of one percent for each
month or part of a month that the amount remains unpaid after October 1.
new text end

new text begin (c) The interest under paragraph (b) does not apply when payment has not been made
by October 1 due to noncompliance with sections 424A.014 and 477B.02, subdivision 7.
new text end

new text begin Subd. 2. new text end

new text begin Appropriation. new text end

new text begin The amount necessary to make the payments under this section
and section 477B.03 is annually appropriated to the commissioner from the general fund.
new text end

new text begin Subd. 3. new text end

new text begin Deposit of state aid. new text end

new text begin (a) If the municipality or the independent nonprofit
firefighting corporation is covered by the voluntary statewide volunteer firefighter retirement
plan under chapter 353G, the executive director of the Public Employees Retirement
Association must credit the fire state aid against future municipal contribution requirements
under section 353G.08 and must notify the municipality or the independent nonprofit
firefighting corporation of the fire state aid so credited at least annually.
new text end

new text begin (b) If the municipality or the independent nonprofit firefighting corporation is not covered
by the voluntary statewide volunteer firefighter retirement plan, the treasurer of the
municipality must, within 30 days after receipt, transmit the fire state aid to the treasurer
of the duly incorporated firefighters' relief association if there is one organized and the
association has filed a financial report with the municipality pursuant to section 424A.014,
subdivision 1 or 2, whichever applies. If the relief association has not filed a financial report
with the municipality, the treasurer of the municipality must delay transmission of the fire
state aid to the relief association until the complete financial report is filed.
new text end

new text begin (c) The treasurer of the municipality must deposit the fire state aid money in the municipal
treasury if (1) the municipality or independent nonprofit firefighting corporation is not
covered by the voluntary statewide volunteer firefighter retirement plan, (2) there is no
relief association organized, (3) the association has dissolved, or (4) the association has
been removed as trustees of state aid. The money may be disbursed from the municipal
treasury only for the purposes and in the manner set forth in section 424A.08 or for the
payment of the employer contribution requirement with respect to firefighters covered by
the public employees police and fire retirement plan under section 353.65, subdivision 3.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 5.

new text begin [477B.05] SHORTFALL FROM GENERAL FUND.
new text end

new text begin (a) If the annual funding requirements of fire relief associations or consolidation accounts
under sections 424A.091 to 424A.095 or Laws 2013, chapter 111, article 5, sections 31 to
42, exceed all applicable revenue sources of a given year, including the insurance premium
taxes funding fire state aid under this chapter as set under section 297I.05, subdivisions 2,
3, and 4, the shortfall in the annual funding requirements must be paid from the general
fund to the extent appropriated by the legislature.
new text end

new text begin (b) Nothing in this section relieves any municipality from its obligation to a relief
association or consolidation account under law.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 6. new text begin PURPOSE.
new text end

new text begin It is the intent of the legislature to make Minnesota's fire and police state aid laws more
understandable by separating and recodifying disparate administration and compliance
provisions currently contained in chapter 69 of Minnesota Statutes. Due to the complexity
of the recodification, prior provisions are repealed on the effective date of the new provisions.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 7. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2018, sections 69.011, subdivisions 1, 2, 2b, 2c, 3, and 4; 69.021,
subdivisions 1, 2, 3, 4, 5, 7, 7a, 8, 9, 10, and 11; 69.031, subdivisions 1, 3, and 5; and 69.041, new text end new text begin
are repealed.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

ARTICLE 8

POLICE STATE AID; TECHNICAL CHANGES

Section 1.

new text begin [477C.01] DEFINITIONS.
new text end

new text begin Subdivision 1. new text end

new text begin Scope. new text end

new text begin Unless the language or context clearly indicates that a different
meaning is intended, the following words and terms, for the purposes of this chapter and
chapter 423A have the meanings given to them.
new text end

new text begin Subd. 2. new text end

new text begin Commissioner. new text end

new text begin "Commissioner" means the commissioner of revenue.
new text end

new text begin Subd. 3. new text end

new text begin Company or insurance company. new text end

new text begin "Company" or "insurance company" has
the meaning given in section 60A.02, subdivision 4.
new text end

new text begin Subd. 4. new text end

new text begin Minnesota Aid to Police Premium Report. new text end

new text begin "Minnesota Aid to Police Premium
Report" means a form for reporting the total gross premiums, less return premiums and
dividends, on all direct business received by an insurance company in this state during the
preceding calendar year, with reference to insurance written for perils contained in auto
insurance coverages as reported to the National Association of Insurance Commissioners
and the commissioner of commerce.
new text end

new text begin Subd. 5. new text end

new text begin Municipal clerk, municipal clerk-treasurer, or county auditor. new text end

new text begin "Municipal
clerk," "municipal clerk-treasurer," or "county auditor" means:
new text end

new text begin (1) the person elected or appointed to the position of municipal clerk, municipal
clerk-treasurer, or county auditor or, if there is no such person, the chief financial official
or the person primarily responsible for managing the finances of a municipality;
new text end

new text begin (2) for a park district, the secretary of the board of park district commissioners;
new text end

new text begin (3) for the University of Minnesota, the official designated by the Board of Regents;
new text end

new text begin (4) for the Metropolitan Airports Commission, the person designated by the commission;
new text end

new text begin (5) for the Departments of Natural Resources and Public Safety, the respective
commissioner of the agency; and
new text end

new text begin (6) for a tribal police department that exercises state arrest powers under section 626.90,
626.91, 626.92, or 626.93, the person designated by the applicable American Indian tribal
government.
new text end

new text begin Subd. 6. new text end

new text begin Municipality. new text end

new text begin (a) "Municipality" means:
new text end

new text begin (1) a home rule charter or statutory city;
new text end

new text begin (2) an organized town;
new text end

new text begin (3) a county;
new text end

new text begin (4) a park district subject to chapter 398;
new text end

new text begin (5) the University of Minnesota;
new text end

new text begin (6) an American Indian tribal government with a tribal police department that exercises
state arrest powers under section 626.90, 626.91, 626.92, or 626.93;
new text end

new text begin (7) the Metropolitan Airports Commission; and
new text end

new text begin (8) the Departments of Natural Resources and Public Safety with respect to peace officers
covered under chapter 352B.
new text end

new text begin (b) This subdivision only applies to chapter 477C.
new text end

new text begin Subd. 7. new text end

new text begin Peace officer. new text end

new text begin "Peace officer" means any person:
new text end

new text begin (1) whose primary source of income derived from wages is from direct employment by
a municipality as a law enforcement officer on a full-time basis of not less than 30 hours
per week;
new text end

new text begin (2) who has been employed for a minimum of six months before December 31 preceding
the date of the current year's certification under section 477C.02, subdivision 1;
new text end

new text begin (3) who is sworn to enforce the general criminal laws of the state and local ordinances;
new text end

new text begin (4) who is licensed by the Peace Officers Standards and Training Board and is authorized
to arrest with a warrant; and
new text end

new text begin (5) who is a member of the State Patrol retirement plan or the public employees police
and fire fund.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 2.

new text begin [477C.02] QUALIFYING FOR POLICE STATE AID.
new text end

new text begin Subdivision 1. new text end

new text begin Certification to commissioner. new text end

new text begin (a) A certification made under this
section must be filed with the commissioner on a form prescribed by the commissioner and
must include all other facts that the commissioner requires.
new text end

new text begin (b) Except as provided in subdivision 2, on or before March 15 annually, the municipal
clerk, municipal clerk-treasurer, or county auditor of each municipality employing one or
more peace officers must certify to the commissioner the number of peace officers employed
during the previous calendar year. No peace officer may be included in the certification by
more than one municipality for the same month.
new text end

new text begin (c) Credit for peace officers employed less than a full year must be apportioned. Each
full month of employment of a qualifying officer during the calendar year entitles the
employing municipality to credit for 1/12 of the payment for employment of a peace officer
for the entire year. For purposes of this chapter, employment of a peace officer begins when
the peace officer is entered on the payroll of the employing municipality.
new text end

new text begin Subd. 2. new text end

new text begin Departments of Natural Resources and Public Safety. new text end

new text begin On or before March
15 annually, the commissioner of natural resources must certify the number of peace officers
employed by the Enforcement Division and the commissioner of public safety must certify
the number of peace officers employed by the Bureau of Criminal Apprehension, the
Gambling Enforcement Division, and the State Patrol Division. The certification must be
on the form described in subdivision 1, paragraph (a). Peace officers certified under this
subdivision must be included in the total certifications under subdivision 1.
new text end

new text begin Subd. 3. new text end

new text begin Ineligibility of certain peace officers. new text end

new text begin A peace officer employed by the
University of Minnesota who is required by the Board of Regents to be a member of the
University of Minnesota faculty retirement plan is not eligible to be included in any police
state aid certification under this section.
new text end

new text begin Subd. 4. new text end

new text begin Penalty for failure to file certification. new text end

new text begin (a) If a certification under subdivision
1 or 2 is not filed with the commissioner on or before March 15, the commissioner must
notify the municipal clerk, municipal clerk-treasurer, or county auditor that a penalty equal
to a portion or all of its current year aid will apply if the certification is not received within
ten days.
new text end

new text begin (b) The penalty for failure to file the certification under subdivision 1 or 2 is equal to
the amount of police state aid determined for the municipality for the current year, multiplied
by five percent for each week or fraction of a week that the certification is late. The penalty
must be computed beginning ten days after the postmark date of the commissioner's
notification as required under this subdivision. All aid amounts forfeited as a result of the
penalty revert to the state general fund. Failure to receive the certification form may not be
used as a defense for a failure to file.
new text end

new text begin Subd. 5. new text end

new text begin Determination by commissioner. new text end

new text begin The commissioner must determine which
municipalities are qualified to receive police state aid based on compliance with the
requirements of this section. The commissioner may take into account any other relevant
information that comes to the attention of the commissioner when making the determination.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 3.

new text begin [477C.03] CALCULATION OF POLICE STATE AID; APPEAL.
new text end

new text begin Subdivision 1. new text end

new text begin Certification and calculation of police state aid. new text end

new text begin (a) On or before
October 1, the commissioner must calculate the amount of police state aid that each
municipality is to receive.
new text end

new text begin (b) The commissioner must calculate an excess police state aid amount for each
municipality under subdivision 3 and must reduce the apportionment amount for each
municipality based on the calculation.
new text end

new text begin Subd. 2. new text end

new text begin Apportionment of police state aid. new text end

new text begin (a) The total amount available for
apportionment as police state aid is equal to 104 percent of the amount of premium taxes
paid to the state on the premiums reported to the commissioner by companies or insurance
companies on the Minnesota Aid to Police Premium Report. The total amount for
apportionment for the police state aid program must not be less than two percent of the
amount of premiums reported to the commissioner by companies or insurance companies
on the Minnesota Aid to Police Premium Report.
new text end

new text begin (b) The commissioner must calculate the percentage of increase or decrease reflected in
the apportionment over or under the previous year's available state aid using the same
premiums as a basis for comparison.
new text end

new text begin (c) In addition to the amount for apportionment of police state aid under paragraph (a),
each year $100,000 must be apportioned for police state aid. An amount sufficient to pay
this increase is annually appropriated from the general fund.
new text end

new text begin (d) The commissioner must apportion police state aid to all municipalities in proportion
to the relationship that the total number of peace officers employed by that municipality for
the prior calendar year and the proportional or fractional number who were employed less
than a calendar year as credited under section 477C.02, subdivision 1, paragraph (c), bears
to the total number of peace officers employed by all municipalities subject to any reduction
under subdivision 3.
new text end

new text begin (e) Any necessary additional adjustments must be made to subsequent police state aid
apportionments.
new text end

new text begin Subd. 3. new text end

new text begin Apportionment reduction; excess police state aid. new text end

new text begin (a) The commissioner
must reduce the apportionment of police state aid under this section for eligible municipalities
by the amount of any excess police state aid calculated under this subdivision.
new text end

new text begin (b) The commissioner must calculate the amount of excess police state aid for each
municipality as follows:
new text end

new text begin (1) for municipalities in which police retirement coverage is provided wholly by the
public employees police and fire fund and all peace officers are members of the plan governed
by sections 353.63 to 353.657, the excess police state aid amount equals the amount of
police state aid apportioned under subdivision 2 that exceeds the employer's total prior
calendar year obligation as defined in paragraph (c), as certified by the executive director
of the Public Employees Retirement Association;
new text end

new text begin (2) for the Metropolitan Airports Commission, the excess police state aid amount equals
the amount of apportioned police aid calculated under subdivision 2 that exceeds the
commission's total prior calendar year obligation as defined in paragraph (c), as certified
by the executive director of the Public Employees Retirement Association; and
new text end

new text begin (3) for the Departments of Natural Resources and Public Safety, the excess police state
aid amount equals the amount of apportioned police aid calculated under subdivision 2 that
exceeds the employer's total prior calendar year obligation under section 352B.02, subdivision
1c, for plan members who are peace officers, as certified by the executive director of the
Minnesota State Retirement System.
new text end

new text begin (c) The municipality's total prior calendar year obligation with respect to the public
employees police and fire plan under paragraph (b), clause (1), is the total prior calendar
year obligation under section 353.65, subdivision 3, for police officers as defined in section
353.64, subdivisions 1, la, and 2, and the actual total prior calendar year obligation under
section 353.65, subdivision 3, for firefighters, as defined in section 353.64, subdivisions 1,
la, and 2, but not to exceed for those firefighters the applicable following employer calendar
year amount:
new text end

	new text begin Municipality new text end	new text begin Maximum Amount new text end
	new text begin Albert Lea new text end	new text begin $54,157.01 new text end
	new text begin Anoka new text end	new text begin 10,399.31 new text end
	new text begin Apple Valley new text end	new text begin 5,442.44 new text end
	new text begin Austin new text end	new text begin 49,864.73 new text end
	new text begin Bemidji new text end	new text begin 27,671.38 new text end
	new text begin Brooklyn Center new text end	new text begin 6,605.92 new text end
	new text begin Brooklyn Park new text end	new text begin 24,002.26 new text end
	new text begin Burnsville new text end	new text begin 15,956.00 new text end
	new text begin Cloquet new text end	new text begin 4,260.49 new text end
	new text begin Coon Rapids new text end	new text begin 39,920.00 new text end
	new text begin Cottage Grove new text end	new text begin 8,588.48 new text end
	new text begin Crystal new text end	new text begin 5,855.00 new text end
	new text begin East Grand Forks new text end	new text begin 51,009.88 new text end
	new text begin Edina new text end	new text begin 32,251.00 new text end
	new text begin Elk River new text end	new text begin 5,216.55 new text end
	new text begin Ely new text end	new text begin 13,584.16 new text end
	new text begin Eveleth new text end	new text begin 16,288.27 new text end
	new text begin Fergus Falls new text end	new text begin 6,742.00 new text end
	new text begin Fridley new text end	new text begin 33,420.64 new text end
	new text begin Golden Valley new text end	new text begin 11,744.61 new text end
	new text begin Hastings new text end	new text begin 16,561.00 new text end
	new text begin Hopkins new text end	new text begin 4,324.23 new text end
	new text begin International Falls new text end	new text begin 14,400.69 new text end
	new text begin Lakeville new text end	new text begin 782.35 new text end
	new text begin Lino Lakes new text end	new text begin 5,324.00 new text end
	new text begin Little Falls new text end	new text begin 7,889.41 new text end
	new text begin Maple Grove new text end	new text begin 6,707.54 new text end
	new text begin Maplewood new text end	new text begin 8,476.69 new text end
	new text begin Minnetonka new text end	new text begin 10,403.00 new text end
	new text begin Montevideo new text end	new text begin 1,307.66 new text end
	new text begin Moorhead new text end	new text begin 68,069.26 new text end
	new text begin New Hope new text end	new text begin 6,739.72 new text end
	new text begin North St. Paul new text end	new text begin 4,241.14 new text end
	new text begin Northfield new text end	new text begin 770.63 new text end
	new text begin Owatonna new text end	new text begin 37,292.67 new text end
	new text begin Plymouth new text end	new text begin 6,754.71 new text end
	new text begin Red Wing new text end	new text begin 3,504.01 new text end
	new text begin Richfield new text end	new text begin 53,757.96 new text end
	new text begin Rosemount new text end	new text begin 1,712.55 new text end
	new text begin Roseville new text end	new text begin 9,854.51 new text end
	new text begin St. Anthony new text end	new text begin 33,055.00 new text end
	new text begin St. Louis Park new text end	new text begin 53,643.11 new text end
	new text begin Thief River Falls new text end	new text begin 28,365.04 new text end
	new text begin Virginia new text end	new text begin 31,164.46 new text end
	new text begin Waseca new text end	new text begin 11,135.17 new text end
	new text begin West St. Paul new text end	new text begin 15,707.20 new text end
	new text begin White Bear Lake new text end	new text begin 6,521.04 new text end
	new text begin Woodbury new text end	new text begin 3,613.00 new text end
	new text begin any other municipality new text end	new text begin 0.00 new text end

new text begin (d) The total amount of excess police state aid must be deposited in the excess police
state aid account in the general fund, and administered and distributed as provided in
subdivision 4.
new text end

new text begin Subd. 4. new text end

new text begin Excess police state aid holding account. new text end

new text begin (a) The excess police state aid holding
account is established in the general fund. The excess police state aid holding account is
administered by the commissioner.
new text end

new text begin (b) Excess police state aid determined under subdivision 3 must be deposited annually
in the excess police state aid holding account.
new text end

new text begin (c) From the balance in the excess police state aid holding account, $900,000 must be
canceled annually to the general fund.
new text end

new text begin (d) On October 1 annually, one-half of the balance of the excess police state aid holding
account remaining after the deduction under paragraph (c) is appropriated for additional
amortization aid under section 423A.02, subdivision 1b.
new text end

new text begin (e) The remaining balance in the excess police state aid holding account, after the
deductions under paragraphs (c) and (d), must be canceled annually to the general fund.
new text end

new text begin Subd. 5. new text end

new text begin Appeal. new text end

new text begin A municipality may object to the amount of police state aid apportioned
to it by filing a written request with the commissioner to review and adjust the apportionment
of funds to the municipality. The decision of the commissioner is subject to appeal, review,
and adjustment by the district court in the county in which the applicable municipality is
located or by the Ramsey County District Court with respect to the Departments of Natural
Resources or Public Safety.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 4.

new text begin [477C.04] APPROPRIATION, PAYMENT, AND ADMINISTRATION.
new text end

new text begin Subdivision 1. new text end

new text begin Payments. new text end

new text begin (a) The commissioner must make payments to the municipality
equal to the amount of police state aid apportioned to the applicable state aid recipient under
section 477C.03.
new text end

new text begin (b) Police state aid is payable on October 1 annually. The amount of state aid due and
not paid by October 1 accrues interest payable to the recipient at the rate of one percent for
each month or part of a month that the amount remains unpaid after October 1.
new text end

new text begin Subd. 2. new text end

new text begin Appropriation. new text end

new text begin (a) The amount necessary to make the payments under this
section and section 477C.03 is annually appropriated to the commissioner from the general
fund.
new text end

new text begin (b) The police state aid apportioned to the Departments of Public Safety and Natural
Resources under section 477C.03 is allocated to the commissioner of management and
budget for transfer to the funds and accounts from which the salaries of peace officers
certified under section 477C.02, subdivision 2, are paid. On or before October l, the
commissioner of revenue must certify to the commissioners of public safety, natural
resources, and management and budget the amounts to be transferred from the appropriation
for police state aid. The commissioners of public safety and natural resources must certify
to the commissioner of management and budget the amounts to be credited to each of the
funds and accounts from which the peace officers employed by their respective departments
are paid.
new text end

new text begin Subd. 3. new text end

new text begin Deposit of state aid. new text end

new text begin (a) For a municipality in which police retirement coverage
is provided by the public employees police and fire fund and all peace officers are members
of the fund, including municipalities covered by section 353.665, the total state aid must
be applied toward the municipality's employer contribution to the public employees police
and fire fund under sections 353.65, subdivision 3, and 353.665, subdivision 8.
new text end

new text begin (b) The county treasurer, upon receipt of the police state aid for the county, must apply
the total state aid toward the county's employer contribution to the public employees police
and fire fund under section 353.65, subdivision 3.
new text end

new text begin (c) The designated Metropolitan Airports Commission official, upon receipt of the police
state aid for the Metropolitan Airports Commission, must apply the total police state aid
toward the commission's employer contribution for peace officers to the public employees
police and fire plan under section 353.65, subdivision 3.
new text end

new text begin (d) The commissioners of public safety and natural resources must allocate the police
state aid first for employer contributions funded from the general fund and then for employer
contributions funded from other funds. For peace officers employed by the Departments of
Natural Resources or Public Safety whose salaries are paid from the general fund, the
amounts transferred from the appropriation for police state aid must be canceled to the
general fund.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

ARTICLE 9

FIRE AND POLICE STATE AID; MISCELLANEOUS TECHNICAL CHANGES

Section 1.

new text begin [297I.26] FIRE AND POLICE PREMIUM REPORTS.
new text end

new text begin Subdivision 1. new text end

new text begin Filing reports. new text end

new text begin (a) Each company must file with the commissioner the
reports defined in sections 477B.01, subdivision 8, and 477C.01, subdivision 4, signed by
the authorized representative of the company, on or before March 1 annually. The fire and
extended coverage portion of multiperil package premiums and all other combination
premiums must be determined by applying percentages determined by the commissioner
or by rating bureaus recognized by the commissioner. The commissioner shall prescribe
the content, form, and manner of the reports.
new text end

new text begin (b) The commissioner must notify each company that fails to timely file the report
required under paragraph (a). The notice must demand that the company file the report
within 30 days. Where good cause exists, the commissioner may extend the period for filing
the report as long as a request for extension is filed by the company before the expiration
of the 30-day period.
new text end

new text begin Subd. 2. new text end

new text begin Penalties. new text end

new text begin (a) A company that fails to file the report on or before the due date
in subdivision 1 is liable for a penalty equal to $25 for each seven days, or fraction thereof,
that the report is delinquent, but not to exceed $200.
new text end

new text begin (b) Any person whose duty it is to file the report and who fails or refuses to file within
30 days after the postmark of the notice in subdivision 1 must be fined an amount of no
more than $1,000.
new text end

new text begin (c) Any company that knowingly makes and files an inaccurate or false report is liable
for a fine in an amount not less than $25 nor more than $1,000, as determined by the
commissioner, and the commissioner of commerce may revoke the company's certificate
of authority.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for reports filed after December 31, 2019.
new text end

Sec. 2.

new text begin [424A.014] FINANCIAL REPORT; BOND; EXAMINATION.
new text end

new text begin Subdivision 1. new text end

new text begin Financial report and audit. new text end

new text begin (a) The board of the Bloomington Fire
Department Relief Association and each volunteer firefighters relief association with assets
of at least $500,000 or liabilities of at least $500,000 in the prior year or in any previous
year, according to the applicable actuarial valuation or according to the financial report if
no valuation is required, must prepare a financial report covering the special and general
funds of the relief association for the preceding fiscal year, file the financial report, and
submit financial statements.
new text end

new text begin (b) The financial report must contain financial statements and disclosures that present
the true financial condition of the relief association and the results of relief association
operations in conformity with generally accepted accounting principles and in compliance
with the regulatory, financing, and funding provisions of this chapter and any other applicable
laws. The financial report must be countersigned by:
new text end

new text begin (1) the municipal clerk or clerk-treasurer of the municipality in which the relief
association is located if the relief association is a firefighters' relief association that is directly
associated with a municipal fire department;
new text end

new text begin (2) the municipal clerk or clerk-treasurer of the largest municipality in population that
contracts with the independent nonprofit firefighting corporation if the volunteer firefighter
relief association is a subsidiary of an independent nonprofit firefighting corporation, and
by the secretary of the independent nonprofit firefighting corporation; or
new text end

new text begin (3) the chief financial official of the county in which the volunteer firefighter relief
association is located or primarily located if the relief association is associated with a fire
department that is not located in or associated with an organized municipality.
new text end

new text begin (c) The financial report must be retained in the office of the Bloomington Fire Department
Relief Association or the volunteer firefighter relief association for public inspection and
must be filed with the governing body of the government subdivision in which the associated
fire department is located after the close of the fiscal year. One copy of the financial report
must be furnished to the state auditor after the close of the fiscal year.
new text end

new text begin (d) Audited financial statements must be attested to by a certified public accountant or
by the state auditor and must be filed with the state auditor on or before June 30 after the
close of the fiscal year. The state auditor may accept this report in lieu of the report required
in paragraph (c).
new text end

new text begin Subd. 2. new text end

new text begin Financial statement. new text end

new text begin (a) The board of each volunteer firefighter relief
association that is not required to file a financial report and audit under subdivision 1 must
prepare a detailed statement of the financial affairs for the preceding fiscal year of the relief
association's special and general funds in the style and form prescribed by the state auditor.
The detailed statement must show:
new text end

new text begin (1) the sources and amounts of all money received;
new text end

new text begin (2) all disbursements, accounts payable, and accounts receivable;
new text end

new text begin (3) the amount of money remaining in the treasury;
new text end

new text begin (4) total assets, including a listing of all investments;
new text end

new text begin (5) the accrued liabilities; and
new text end

new text begin (6) all other items necessary to show accurately the revenues and expenditures and
financial position of the relief association.
new text end

new text begin (b) The detailed financial statement of the special and general funds required under
paragraph (a) must be certified by a certified public accountant or by the state auditor in
accordance with agreed-upon procedures and forms prescribed by the state auditor. The
accountant must have at least five years of public accounting, auditing, or similar experience
and must not be an active, inactive, or retired member of the relief association or the fire
department.
new text end

new text begin (c) The detailed financial statement required under paragraph (a) must be countersigned
by:
new text end

new text begin (1) the municipal clerk or clerk-treasurer of the municipality;
new text end

new text begin (2) where applicable, the municipal clerk or clerk-treasurer of the largest municipality
in population that contracts with the independent nonprofit firefighting corporation if the
relief association is a subsidiary of an independent nonprofit firefighting corporation, and
by the secretary of the independent nonprofit firefighting corporation; or
new text end

new text begin (3) the chief financial official of the county in which the volunteer firefighter relief
association is located or primarily located if the relief association is associated with a fire
department that is not located in or associated with an organized municipality.
new text end

new text begin (d) The volunteer firefighters relief association board must submit a copy of the detailed
financial statement required under paragraph (a) that has been certified by the governing
body of the municipality to the state auditor on or before March 31 after the close of the
fiscal year.
new text end

new text begin (e) A certified public accountant or auditor who performs the agreed-upon procedures
under paragraph (b) is subject to the reporting requirement of section 6.67.
new text end

new text begin Subd. 3. new text end

new text begin Qualification. new text end

new text begin The state auditor may, upon a demonstration by a relief
association of hardship or an inability to conform, extend the deadline for reports under
subdivision 1 or 2, but not beyond November 30 following the due date. If the reports are
not received by November 30, the municipality or relief association forfeits its current year
state aid, and, until the state auditor receives the required information, the relief association
or municipality is ineligible to receive any future state aid. A municipality or relief association
does not qualify initially to receive, or be entitled subsequently to retain, fire state aid and
police and firefighter retirement supplemental state aid payable under chapter 477B and
section 423A.022 if the financial reporting requirement or the applicable requirements of
this chapter or any other statute or special law have not been complied with or are not
fulfilled.
new text end

new text begin Subd. 4. new text end

new text begin Treasurer bond. new text end

new text begin (a) The treasurer of the Bloomington Fire Department Relief
Association may not enter upon duties without having given the association a bond in a
reasonable amount acceptable to the municipality for the faithful discharge of duties
according to law.
new text end

new text begin (b) No treasurer of a relief association governed by sections 424A.091 to 424A.096 may
enter upon the duties of the office until the treasurer has given the association a good and
sufficient bond in an amount equal to at least ten percent of the assets of the relief association;
however, the amount of the bond need not exceed $500,000.
new text end

new text begin Subd. 5. new text end

new text begin Report by certain municipalities; exceptions. new text end

new text begin (a) The chief administrative
officer of each municipality that has a fire department but does not have a relief association
governed by sections 424A.091 to 424A.095 or Laws 2014, chapter 275, article 2, section
23, and that is not exempted under paragraph (b) or (c) must annually prepare a detailed
financial report of the receipts and disbursements by the municipality for fire protection
service during the preceding calendar year on a form prescribed by the state auditor. The
financial report must contain any information that the state auditor deems necessary to
disclose the sources of receipts and the purpose of disbursements for fire protection service.
The financial report must be signed by the municipal clerk or clerk-treasurer with the state
auditor on or before July 1 annually. The municipality does not qualify initially to receive,
and is not entitled subsequently to retain, any fire state aid and police and firefighter
retirement supplemental state aid payable under chapter 477B and section 423A.022 if the
financial reporting requirement or the applicable requirements of any other statute or special
law have not been complied with or are not fulfilled.
new text end

new text begin (b) Each municipality that has a fire department and provides retirement coverage to its
firefighters through the voluntary statewide volunteer firefighter retirement plan under
chapter 353G qualifies to have fire state aid transmitted to and retained in the statewide
volunteer firefighter retirement fund without filing a detailed financial report if the executive
director of the Public Employees Retirement Association certifies compliance by the
municipality with the requirements of sections 353G.04 and 353G.08, subdivision 1,
paragraph (e), and certifies conformity by the applicable fire chief with the requirements
of section 353G.07.
new text end

new text begin (c) Each municipality qualifies to receive fire state aid under chapter 477B without filing
a financial report under paragraph (a) if the municipality:
new text end

new text begin (1) has a fire department;
new text end

new text begin (2) does not have a volunteer firefighters relief association directly associated with its
fire department;
new text end

new text begin (3) does not participate in the statewide volunteer firefighter retirement plan under
chapter 353G;
new text end

new text begin (4) provides retirement coverage to its firefighters through the public employees police
and fire retirement plan under sections 353.63 to 353.68; and
new text end

new text begin (5) is certified by the executive director of the Public Employees Retirement Association
to the state auditor to have had an employer contribution under section 353.65, subdivision
3, for its firefighters for the immediately prior calendar year equal to or greater than its fire
state aid for the immediately prior calendar year.
new text end

new text begin Subd. 6. new text end

new text begin Notification by commissioner of revenue and state auditor. new text end

new text begin (a) The state
auditor, in performing an audit or examination, must notify the Legislative Commission on
Pensions and Retirement if the audit or examination reveals malfeasance, misfeasance, or
nonfeasance in office by relief association officials or municipal officials.
new text end

new text begin (b) The commissioner of revenue must notify the Legislative Commission on Pensions
and Retirement if the state auditor has not filed the required financial compliance reports
by July 1.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 3.

Minnesota Statutes 2018, section 424A.05, is amended by adding a subdivision to
read:

new text begin Subd. 3b. new text end

new text begin Authorized administrative expenses from special fund. new text end

new text begin (a) Notwithstanding
any provision of law to the contrary, the payment of the following necessary, reasonable,
and direct expenses of maintaining, protecting, and administering the special fund, when
provided for in the bylaws of the association and approved by the board of trustees,
constitutes authorized administrative expenses of a volunteer firefighters relief association
organized under any law of the state or the Bloomington Fire Department Relief Association:
new text end

new text begin (1) office expenses, including but not limited to rent, utilities, equipment, supplies,
postage, periodical subscriptions, furniture, fixtures, and salaries of administrative personnel;
new text end

new text begin (2) salaries of the officers of the association or their designees, and salaries of the
members of the board of trustees of the association if the salary amounts are approved by
the governing body of the entity that is responsible for meeting any minimum obligation
under section 424A.092 or 424A.093 or Laws 2013, chapter 111, article 5, sections 31 to
42, and the itemized expenses of relief association officers and board members that are
incurred as a result of fulfilling their responsibilities as administrators of the special fund;
new text end

new text begin (3) tuition, registration fees, organizational dues, and other authorized expenses of the
officers or members of the board of trustees incurred in attending educational conferences,
seminars, or classes relating to the administration of the relief association;
new text end

new text begin (4) audit and audit-related services, accounting and accounting-related services, and
actuarial, medical, legal, and investment and performance evaluation expenses;
new text end

new text begin (5) filing and application fees payable by the relief association to federal or other
government entities;
new text end

new text begin (6) reimbursement to the officers and members of the board of trustees or their designees,
for reasonable and necessary expenses actually paid and incurred in the performance of
their duties as officers or members of the board; and
new text end

new text begin (7) premiums on fiduciary liability insurance and official bonds for the officers, members
of the board of trustees, and employees of the relief association.
new text end

new text begin (b) All other expenses of the relief association must be paid from the general fund of
the association if one exists. If a relief association has only one fund, that fund is the special
fund for purposes of this subdivision. If a relief association has a special fund and a general
fund, the payment of any expense of the relief association that is directly related to the
purposes for which both funds were established must be apportioned between the two funds
on the basis of the benefits derived by each fund.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 4. new text begin REPEALER.
new text end

new text begin (a) new text end new text begin Minnesota Statutes 2018, sections 69.051, subdivisions 1, 1a, 1b, 2, 3, and 4; and
69.80, new text end new text begin are repealed.
new text end

new text begin (b) new text end new text begin Minnesota Statutes 2018, sections 69.33; and 297I.25, subdivision 2, new text end new text begin are repealed.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin Paragraph (a) is effective July 1, 2019. Paragraph (b) is effective
for reports filed after December 31, 2019.
new text end

ARTICLE 10

FIRE AND POLICE STATE AID; CONFORMING CHANGES

Section 1.

Minnesota Statutes 2018, section 6.495, subdivision 3, is amended to read:

Subd. 3.

Report to commissioner of revenue.

The state auditor shall file with the
commissioner of revenue a financial compliance report certifying for each relief association:

(1) the completion of the annual financial report required under section deleted text begin 69.051 deleted text end new text begin 424A.014 new text end
and the auditing or certification of those financial reports under subdivision 1; and

(2) the receipt of any actuarial valuations required under section 424A.093 or Laws
2013, chapter 111, article 5, sections 31 to 42.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 2.

Minnesota Statutes 2018, section 144E.42, subdivision 2, is amended to read:

Subd. 2.

Trust account.

(a) There is established in the general fund the Cooper/Sams
volunteer ambulance trust account and the Cooper/Sams volunteer ambulance award and
account.

(b) The trust account must be credited with:

(1) general fund appropriations for that purpose;

(2) transfers from the Cooper/Sams volunteer ambulance award and account; and

(3) investment earnings on those accumulated proceeds. The assets and income of the
trust account must be held and managed by the commissioner of management and budget
and the State Board of Investment for the benefit of the state of Minnesota and its general
creditors.

(c) The Cooper/Sams volunteer ambulance account must be credited with transfers from
the excess police state-aid holding account established in section deleted text begin 69.021, subdivision 11 deleted text end new text begin
477C.03, subdivision 4 new text end , any per-year-of-service allocation under section 144E.45, subdivision
2, paragraph (c), that was not made for an individual, and investment earnings on those
accumulated proceeds. The Cooper/Sams volunteer ambulance account must be managed
by the commissioner of management and budget and the State Board of Investment. From
the Cooper/Sams volunteer ambulance account to the trust account there must be transferred
to the Cooper/Sams volunteer ambulance trust account, as the Cooper/Sams volunteer
ambulance account balance permits, the following amounts:

(1) an amount equal to any general fund appropriation to the Cooper/Sams volunteer
ambulance trust account for that fiscal year; and

(2) an amount equal to the percentage of the remaining balance in the account after the
deduction of the amount under clause (1), as specified for the applicable fiscal year:

Fiscal year		Percentage
	1995	20
	1996	40
	1997	50
	1998	60
	1999	70
	2000	80
	2001	90
	2002 and thereafter	100

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 3.

Minnesota Statutes 2018, section 297I.20, subdivision 3, is amended to read:

Subd. 3.

Historic structure rehabilitation credit.

An insurance company may claim
a credit against the premiums tax imposed under this chapter equal to the amount of the
credit certificate issued to it, or to a person who has assigned the credit to the insurance
company, under section 290.0681. If the amount of the credit exceeds the liability for tax
under this chapter, the commissioner shall refund the excess to the insurance company. An
amount sufficient to pay the refunds under this section is appropriated to the commissioner
from the general fund. This credit does not affect the calculation of deleted text begin police and deleted text end fire new text begin state new text end aid
under section deleted text begin 69.021 deleted text end new text begin 477B.03 and police state aid under section 477C.03 new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 4.

Minnesota Statutes 2018, section 353G.01, subdivision 9, is amended to read:

Subd. 9.

Municipality.

"Municipality" means a governmental entity specified in section
deleted text begin 69.011, subdivision 1, paragraph (b), clauses (1), (2), and (5) deleted text end new text begin 477B.01, subdivision 10 new text end , a
city or township that has entered into a contract with an independent nonprofit firefighting
corporation, or a city or township that has entered into a contract with a joint powers entity
established under section 471.59.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 5.

Minnesota Statutes 2018, section 353G.05, subdivision 2, is amended to read:

Subd. 2.

Election of coverage; lump sum.

(a) The process for electing coverage of
volunteer firefighters by the lump-sum retirement division is initiated by a request to the
executive director for a cost analysis of the prospective retirement coverage under the
lump-sum retirement division.

(b) If the volunteer firefighters are currently covered by a lump-sum volunteer firefighter
relief association or a defined contribution volunteer firefighter relief association governed
by chapter 424A, the cost analysis of the prospective retirement coverage must be requested
jointly by the secretary of the volunteer firefighter relief association, following approval of
the request by the board of the volunteer firefighter relief association, and the chief
administrative officer of the entity associated with the relief association, following approval
of the request by the governing body of the entity associated with the relief association. If
the relief association is associated with more than one entity, the chief administrative officer
of each associated entity must execute the request. If the volunteer firefighters are not
currently covered by a volunteer firefighter relief association, the cost analysis of the
prospective retirement coverage must be requested by the chief administrative officer of
the entity operating the fire department. The request must be made in writing and must be
made on a form prescribed by the executive director.

(c) The cost analysis of the prospective retirement coverage by the lump-sum retirement
division of the statewide retirement plan must be based on the service pension amount under
section 353G.11 closest to the service pension amount provided by the volunteer firefighter
relief association if the relief association is a lump-sum defined benefit plan, or the amount
equal to 95 percent of the most current average account balance per relief association member
if the relief association is a defined contribution plan, or to the lowest service pension amount
under section 353G.11 if there is no volunteer firefighter relief association, rounded up, and
any other service pension amount designated by the requester or requesters. The cost analysis
must be prepared using a mathematical procedure certified as accurate by an approved
actuary retained by the Public Employees Retirement Association.

(d) If a cost analysis is requested and a volunteer deleted text begin firefighters' deleted text end new text begin firefighters new text end relief association
exists that has filed the information required under section deleted text begin 69.051 deleted text end new text begin 424A.014 new text end in a timely
fashion, upon request by the executive director, the state auditor shall provide the most
recent data available on the financial condition of the volunteer firefighter relief association,
the most recent firefighter demographic data available, and a copy of the current relief
association bylaws. If a cost analysis is requested, but no volunteer firefighter relief
association exists, the chief administrative officer of the entity operating the fire department
shall provide the demographic information on the volunteer firefighters serving as members
of the fire department requested by the executive director.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 6.

Minnesota Statutes 2018, section 353G.08, subdivision 1, is amended to read:

Subdivision 1.

Annual funding requirements; lump-sum retirement division.

(a)
Annually, the executive director shall determine the funding requirements of each account
in the lump-sum retirement division of the voluntary statewide volunteer firefighter retirement
plan on or before August 1. The funding requirements computed under this subdivision
must be determined using a mathematical procedure developed and certified as accurate by
the approved actuary retained by the Public Employees Retirement Association and must
be based on present value factors using a six percent interest rate, without any decrement
assumptions. The funding requirements must be certified to the entity or entities associated
with the fire department whose active firefighters are covered by the retirement plan.

(b) The overall funding balance of each lump-sum account for the current calendar year
must be determined in the following manner:

(1) The total accrued liability for all active and deferred members of the account as of
December 31 of the current year must be calculated based on the good time service credit
of active and deferred members as of that date.

(2) The total present assets of the account projected to December 31 of the current year,
including receipts by and disbursements from the account anticipated to occur on or before
December 31, must be calculated. To the extent possible, the market value of assets must
be utilized in making this calculation.

(3) The amount of the total present assets calculated under clause (2) must be subtracted
from the amount of the total accrued liability calculated under clause (1). If the amount of
total present assets exceeds the amount of the total accrued liability, then the account is
considered to have a surplus over full funding. If the amount of the total present assets is
less than the amount of the total accrued liability, then the account is considered to have a
deficit from full funding. If the amount of total present assets is equal to the amount of the
total accrued liability, then the special fund is considered to be fully funded.

(c) The financial requirements of each lump-sum account for the following calendar
year must be determined in the following manner:

(1) The total accrued liability for all active and deferred members of the account as of
December 31 of the calendar year next following the current calendar year must be calculated
based on the good time service used in the calculation under paragraph (b), clause (1),
increased by one year.

(2) The increase in the total accrued liability of the account for the following calendar
year over the total accrued liability of the account for the current year must be calculated.

(3) The amount of administrative expenses of the account must be calculated by
multiplying the per-person dollar amount of the administrative expenses for the most recent
prior calendar year by the number of active and deferred firefighters reported to PERA on
the most recent good time service credit certification form for each account.

(4) If the account is fully funded, the financial requirement of the account for the
following calendar year is the total of the amounts calculated under clauses (2) and (3).

(5) If the account has a deficit from full funding, the financial requirement of the account
for the following calendar year is the total of the amounts calculated under clauses (2) and
(3) plus an amount equal to one-tenth of the amount of the deficit from full funding of the
account.

(6) If the account has a surplus over full funding, the financial requirement of the account
for the following calendar year is the financial requirement of the account calculated as
though the account was fully funded under clause (4) and, if the account has also had a
surplus over full funding during the prior two years, additionally reduced by an amount
equal to one-tenth of the amount of the surplus over full funding of the account.

(d) The required contribution of the entity or entities associated with the fire department
whose active firefighters are covered by the lump-sum retirement division is the annual
financial requirements of the lump-sum account of the retirement plan under paragraph (c)
reduced by the amount of any fire state aid payable under deleted text begin sections 69.011 to 69.051 deleted text end new text begin chapter
477B new text end or police and firefighter retirement supplemental state aid payable under section
423A.022 that is reasonably anticipated to be received by the retirement plan attributable
to the entity or entities during the following calendar year, and an amount of interest on the
assets projected to be received during the following calendar year calculated at the rate of
six percent per annum. The required contribution must be allocated between the entities if
more than one entity is involved. A reasonable amount of anticipated fire state aid is an
amount that does not exceed the fire state aid actually received in the prior year multiplied
by the factor 1.035.

(e) The required contribution calculated in paragraph (d) must be paid to the retirement
plan on or before December 31 of the year for which it was calculated. If the contribution
is not received by the retirement plan by December 31, it is payable with interest at an
annual compound rate of six percent from the date due until the date payment is received
by the retirement plan. If the entity does not pay the full amount of the required contribution,
the executive director shall collect the unpaid amount under section 353.28, subdivision 6.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 7.

Minnesota Statutes 2018, section 353G.08, subdivision 1a, is amended to read:

Subd. 1a.

Annual funding requirements; monthly benefit retirement division.

(a)
Annually, the executive director shall determine the funding requirements of each monthly
benefit account in the voluntary statewide volunteer firefighter retirement plan on or before
August 1.

(b) The executive director must determine the funding requirements of a monthly benefit
account under this subdivision from:

(1) the most recent actuarial valuation normal cost, administrative expense, including
the cost of a regular actuarial valuation, and amortization results for the account determined
by the approved actuary retained by the retirement association under sections 356.215 and
356.216; and

(2) the standards for actuarial work, utilizing a six percent interest rate actuarial
assumption and other actuarial assumptions approved under section 356.215, subdivision
18:

(i) with that portion of any unfunded actuarial accrued liability attributable to a benefit
increase to be amortized over a period of 20 years from the date of the benefit change;

(ii) with that portion of any unfunded actuarial accrued liability attributable to an
assumption change or an actuarial method change to be amortized over a period of 20 years
from the date of the assumption or method change;

(iii) with that portion of any unfunded actuarial accrued liability attributable to an
investment loss to be amortized over a period of ten years from the date of investment loss;
and

(iv) with the balance of any net unfunded actuarial accrued liability to be amortized over
a period of five years from the date of the actuarial valuation.

(c) The required contributions of the entity or entities associated with the fire department
whose active firefighters are covered by the monthly benefit retirement division are the
annual financial requirements of the monthly benefit account of the retirement plan under
paragraph (b) reduced by the amount of any fire state aid payable under deleted text begin sections 69.011 to
69.051 deleted text end new text begin chapter 477B new text end , or any police and firefighter retirement supplemental state aid payable
under section 423A.022, that is reasonably anticipated to be received by the retirement plan
attributable to the entity or entities during the following calendar year. The required
contribution must be allocated between the entities if more than one entity is involved. A
reasonable amount of anticipated fire state aid is an amount that does not exceed the fire
state aid actually received in the prior year multiplied by the factor 1.035.

(d) The required contribution calculated in paragraph (c) must be paid to the retirement
plan on or before December 31 of the year for which it was calculated. If the contribution
is not received by the retirement plan by December 31, it is payable with interest at an
annual compound rate of six percent from the date due until the date payment is received
by the retirement plan. If the entity does not pay the full amount of the required contribution,
the executive director shall collect the unpaid amount under section 353.28, subdivision 6.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 8.

Minnesota Statutes 2018, section 353G.17, subdivision 2, is amended to read:

Subd. 2.

Approval by the relief association.

(a) Before a transfer of records, assets,
and liabilities from the retirement plan to a relief association may occur, the board of trustees
of the relief association shall adopt resolutions as follows:

(1) approving and accepting the transfer of records, assets, and liabilities from the
retirement plan; and

(2) amending the bylaws of the relief association as necessary to add the firefighters
whose benefits are being transferred from the retirement plan and to provide that each benefit
being transferred retains vesting, distribution, and other rights to which the firefighter, for
whom the benefit is being transferred, is entitled under the terms of the retirement plan to
the date of the transfer.

The board of trustees shall file a copy of the resolutions with the executive director.

(b) The board of trustees of the relief association shall file with the state auditor the
following:

(1) a copy of the resolutions required under paragraph (a);

(2) a copy of the bylaws of the relief association and any bylaw amendments;

(3) a copy of the relief association's investment policy;

(4) a statement that a board of trustees has been duly elected and each trustee's name,
address, telephone number, and e-mail address, if any;

(5) a copy of the most recent annual financial, investment, and plan administration report
filed under section deleted text begin 69.051 deleted text end new text begin 424A.014 new text end , unless the due date for the first report has not yet
occurred; and

(6) a copy of the documentation indicating that a special fund has been established with
a financial institution to receive a transfer of assets from the retirement plan.

(c) Upon receipt of the information and documents required under paragraph (b), the
state auditor shall issue to the relief association and the executive director written
confirmation of receipt of all required information and documents.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 9.

Minnesota Statutes 2018, section 356.20, subdivision 4a, is amended to read:

Subd. 4a.

Financial report for police or firefighters relief association.

For any police
or deleted text begin firefighter's deleted text end new text begin firefighters new text end relief association referred to in subdivision 2, clause (10) or (11),
a financial report that is duly filed and that meets the requirements of section deleted text begin 69.051 deleted text end
new text begin 424A.014 new text end is deemed to have met the requirements of subdivision 4.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 10.

Minnesota Statutes 2018, section 356.219, subdivision 8, is amended to read:

Subd. 8.

Timing of reports.

(a) For the Bloomington Fire Department Relief Association
and the volunteer firefighter relief associations, the information required under this section
must be submitted by the due date for reports required under section deleted text begin 69.051, subdivision 1
or 1a deleted text end new text begin 424A.014, subdivision 1 or 2 new text end , as applicable. If a relief association satisfies the definition
of a fully invested plan under subdivision 1, paragraph (b), for the calendar year covered
by the report required under section deleted text begin 69.051, subdivision 1 or 1a deleted text end new text begin 424A.014, subdivision 1
or 2 new text end , as applicable, the chief administrative officer of the covered pension plan shall certify
that compliance on a form prescribed by the state auditor. The state auditor shall transmit
annually to the State Board of Investment a list or lists of covered pension plans which
submitted certifications in order to facilitate reporting by the State Board of Investment
under paragraph (c).

(b) For the St. Paul Teachers Retirement Fund Association and the University of
Minnesota faculty supplemental retirement plan, the information required under this section
must be submitted to the state auditor by June 1 of each year.

(c) The State Board of Investment, on behalf of pension funds specified in subdivision
1, paragraph (c), shall report information required under this section by September 1 of each
year.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 11.

Minnesota Statutes 2018, section 423A.02, subdivision 1b, is amended to read:

Subd. 1b.

Additional amortization state aid.

(a) Annually, the commissioner shall
allocate the additional amortization state aid, if any, including any state aid in excess of the
limitation in subdivision 4, on the following basis:

(1) 47.1 percent to the city of Minneapolis to defray the employer costs associated with
police and firefighter retirement coverage;

(2) 25.8 percent as additional funding to support the minimum fire state aid for volunteer
firefighter relief associations under section deleted text begin 69.021, subdivision 7, paragraph (d) deleted text end new text begin 477B.03,
subdivision 5 new text end ;

(3) 12.9 percent to the city of Duluth to defray employer costs associated with police
and firefighter retirement coverage;

(4) 12.9 percent to the St. Paul Teachers Retirement Fund Association if the investment
performance requirement of paragraph (c) is met; and

(5) 1.3 percent to the city of Virginia to defray the employer contribution under section
353.665, subdivision 8, paragraph (d).

If there is no additional employer contribution under section 353.665, subdivision 8,
paragraph (b), certified under subdivision 1, paragraph (d), clause (2), with respect to the
former Minneapolis Police Relief Association and the former Minneapolis Fire Department
Relief Association, the commissioner shall allocate that 47.1 percent of the aid as follows:
49 percent to the Teachers Retirement Association, 21 percent to the St. Paul Teachers
Retirement Fund Association, and 30 percent as additional funding to support minimum
fire state aid for volunteer firefighter relief associations under section deleted text begin 69.021, subdivision
7, paragraph (d) deleted text end new text begin 477B.03, subdivision 5 new text end . If there is no employer contribution by the city of
Virginia under section 353.665, subdivision 8, paragraph (d), for the former Virginia Fire
Department Relief Association certified on or before June 30 by the executive director of
the Public Employees Retirement Association, the commissioner shall allocate that 1.3
percent of the aid as follows: 49 percent to the Teachers Retirement Association, 21 percent
to the St. Paul Teachers Retirement Fund Association, and 30 percent as additional funding
to support minimum fire state aid for volunteer firefighter relief associations under section
deleted text begin 69.021, subdivision 7, paragraph (d) deleted text end new text begin 477B.03, subdivision 5 new text end .

(b) The allocation must be made by the commissioner of revenue on October 1 annually.

(c) With respect to the St. Paul Teachers Retirement Fund Association, annually, if the
teacher's association five-year average time-weighted rate of investment return does not
equal or exceed the performance of a composite portfolio assumed passively managed
(indexed) invested ten percent in cash equivalents, 60 percent in bonds and similar debt
securities, and 30 percent in domestic stock calculated using the formula under section
11A.04, clause (11), the aid allocation to the retirement fund under this section ceases until
the five-year annual rate of investment return equals or exceeds the performance of that
composite portfolio.

(d) The amounts required under this subdivision are the amounts annually appropriated
to the commissioner of revenue under section deleted text begin 69.021, subdivision 11 deleted text end new text begin 477B.03, subdivision
5 new text end , paragraph (d), if any, and the aid amounts in excess of the limitation in subdivision 4.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 12.

Minnesota Statutes 2018, section 423A.02, subdivision 3, is amended to read:

Subd. 3.

Reallocation of amortization state aid.

(a) Seventy percent of the difference
between $5,720,000 and the current year amortization aid distributed under subdivision 1
that is not distributed for any reason to a municipality must be distributed by the
commissioner of revenue according to this paragraph. The commissioner shall distribute
60 percent of the amounts derived under this paragraph to the Teachers Retirement
Association, and 40 percent to the St. Paul Teachers Retirement Fund Association to fund
the unfunded actuarial accrued liabilities of the respective funds. These payments must be
made on July 15 each fiscal year. If the St. Paul Teachers Retirement Fund Association or
the Teachers Retirement Association satisfies subdivision 5, eligibility for its portion of this
aid ceases. Amounts remaining in the undistributed balance account at the end of the
biennium if aid eligibility ceases cancel to the general fund.

(b) In order to receive amortization aid under paragraph (a), before June 30 annually
Independent School District No. 625, St. Paul, must make an additional contribution of
$800,000 each year to the St. Paul Teachers Retirement Fund Association.

(c) Thirty percent of the difference between $5,720,000 and the current year amortization
aid under subdivision 1 that is not distributed for any reason to a municipality must be
distributed under section deleted text begin 69.021, subdivision 7, paragraph (d) deleted text end new text begin 477B.03, subdivision 5 new text end , as
additional funding to support a minimum fire state aid amount for volunteer firefighter relief
associations.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 13.

Minnesota Statutes 2018, section 423A.022, subdivision 2, is amended to read:

Subd. 2.

Allocation.

(a) Of the total amount appropriated as supplemental state aid:

(1) 58.064 percent must be paid to the executive director of the Public Employees
Retirement Association for deposit in the public employees police and fire retirement fund
established by section 353.65, subdivision 1;

(2) 35.484 percent must be paid to municipalities other than municipalities solely
employing firefighters with retirement coverage provided by the public employees police
and fire retirement plan which qualified to receive fire state aid in that calendar year, allocated
in proportion to the most recent amount of fire state aid paid under section deleted text begin 69.021,
subdivision 7 deleted text end new text begin 477B.04 new text end , for the municipality bears to the most recent total fire state aid for
all municipalities other than the municipalities solely employing firefighters with retirement
coverage provided by the public employees police and fire retirement plan paid under section
deleted text begin 69.021, subdivision 7 deleted text end new text begin 477B.04 new text end , with the allocated amount for fire departments participating
in the voluntary statewide lump-sum volunteer firefighter retirement plan paid to the
executive director of the Public Employees Retirement Association for deposit in the fund
established by section 353G.02, subdivision 3, and credited to the respective account and
with the balance paid to the treasurer of each municipality for transmittal within 30 days of
receipt to the treasurer of the applicable volunteer firefighter relief association for deposit
in its special fund; and

(3) 6.452 percent must be paid to the executive director of the Minnesota State Retirement
System for deposit in the state patrol retirement fund.

(b) For purposes of this section, the term "municipalities" includes independent nonprofit
firefighting corporations that participate in the voluntary statewide lump-sum volunteer
firefighter retirement plan under chapter 353G or with subsidiary volunteer firefighter relief
associations operating under chapter 424A.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 14.

Minnesota Statutes 2018, section 423A.022, subdivision 4, is amended to read:

Subd. 4.

Payments; conditions prerequisite.

(a) The payments under this section must
be made on October 1 each year, with interest at one percent for each month, or portion of
a month, that the amount remains unpaid after October 1. Any necessary adjustments must
be made to subsequent payments.

(b) The provisions of deleted text begin sections 69.011 to 69.051 deleted text end new text begin chapter 477B and section 424A.014 new text end that
prevent municipalities and relief associations from being eligible for, or receiving fire state
aid under deleted text begin sections 69.011 to 69.051 deleted text end new text begin chapter 477B and section 424A.014 new text end until the applicable
financial reporting requirements have been complied with, apply to the amounts payable to
municipalities and relief associations under this section.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019, except the references to
Minnesota Statutes, chapter 477B, are effective for aids payable in 2020 and thereafter.
new text end

Sec. 15.

Minnesota Statutes 2018, section 424A.016, subdivision 2, is amended to read:

Subd. 2.

Defined contribution service pension eligibility.

(a) A relief association,
when its articles of incorporation or bylaws so provide, may pay out of the assets of its
special fund a defined contribution service pension to each of its members who:

(1) separates from active service with the fire department;

(2) reaches age 50;

(3) completes at least five years of active service as an active member of the fire
department to which the relief association is associated;

(4) completes at least five years of active membership with the relief association before
separation from active service; and

(5) complies with any additional conditions as to age, service, and membership that are
prescribed by the bylaws of the relief association.

(b) In the case of a member who has completed at least five years of active service as
an active member of the fire department to which the relief association is associated on the
date that the relief association is established and incorporated, the requirement that the
member complete at least five years of active membership with the relief association before
separation from active service may be waived by the board of trustees of the relief association
if the member completes at least five years of inactive membership with the relief association
before the date of the payment of the service pension. During the period of inactive
membership, the member is not entitled to receive any disability benefit coverage, is not
entitled to receive additional individual account allocation of fire state aid or municipal
contribution towards a service pension, and is considered to have the status of a person
entitled to a deferred service pension.

(c) The service pension earned by a volunteer under this chapter and the articles of
incorporation and bylaws of the relief association may be paid whether or not the municipality
or independent nonprofit firefighting corporation to which the relief association is associated
qualifies for the receipt of fire state aid under chapter deleted text begin 69 deleted text end new text begin 477B new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 16.

Minnesota Statutes 2018, section 424A.016, subdivision 4, is amended to read:

Subd. 4.

Individual accounts.

(a) An individual account must be established for each
firefighter who is a member of the relief association.

(b) To each individual active member account must be credited an equal share of:

(1) any amounts of fire state aid and police and firefighter retirement supplemental state
aid received by the relief association;

(2) any amounts of municipal contributions to the relief association raised from levies
on real estate or from other available municipal revenue sources exclusive of fire state aid;
and

(3) any amounts equal to the share of the assets of the special fund to the credit of:

(i) any former member who terminated active service with the fire department to which
the relief association is associated before meeting the minimum service requirement provided
for in subdivision 2, paragraph (b), and has not returned to active service with the fire
department for a period no shorter than five years; or

(ii) any retired member who retired before obtaining a full nonforfeitable interest in the
amounts credited to the individual member account under subdivision 2, paragraph (b), and
any applicable provision of the bylaws of the relief association. In addition, any investment
return on the assets of the special fund must be credited in proportion to the share of the
assets of the special fund to the credit of each individual active member account.
Administrative expenses of the relief association payable from the special fund may be
deducted from individual accounts in a manner specified in the bylaws of the relief
association.

(c) If the bylaws so permit and as the bylaws define, the relief association may credit
any investment return on the assets of the special fund to the accounts of inactive members.

(d) Amounts to be credited to individual accounts must be allocated uniformly for all
years of active service and allocations must be made for all years of service, except for caps
on service credit if so provided in the bylaws of the relief association. Amounts forfeited
under paragraph (b), clause (3), before a resumption of active service and membership under
section 424A.01, subdivision 6, remain forfeited and may not be reinstated upon the
resumption of active service and membership. The allocation method may utilize monthly
proration for fractional years of service, as the bylaws or articles of incorporation of the
relief association so provide. The bylaws or articles of incorporation may define a "month,"
but the definition must require a calendar month to have at least 16 days of active service.
If the bylaws or articles of incorporation do not define a "month," a "month" is a completed
calendar month of active service measured from the member's date of entry to the same date
in the subsequent month.

(e) At the time of retirement under subdivision 2 and any applicable provision of the
bylaws of the relief association, a retiring member is entitled to that portion of the assets of
the special fund to the credit of the member in the individual member account which is
nonforfeitable under subdivision 3 and any applicable provision of the bylaws of the relief
association based on the number of years of service to the credit of the retiring member.

(f) Annually, the secretary of the relief association shall certify the individual account
allocations to the state auditor at the same time that the annual financial statement or financial
report and audit of the relief association, whichever applies, is due under section deleted text begin 69.051 deleted text end new text begin
424A.014 new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 17.

Minnesota Statutes 2018, section 424A.02, subdivision 1, is amended to read:

Subdivision 1.

Authorization.

(a) A defined benefit relief association, when its articles
of incorporation or bylaws so provide, may pay out of the assets of its special fund a defined
benefit service pension to each of its members who: (1) separates from active service with
the fire department; (2) reaches age 50; (3) completes at least five years of active service
as an active member of the fire department to which the relief association is associated; (4)
completes at least five years of active membership with the relief association before
separation from active service; and (5) complies with any additional conditions as to age,
service, and membership that are prescribed by the bylaws of the relief association. A service
pension computed under this section may be prorated monthly for fractional years of service
as the bylaws or articles of incorporation of the relief association so provide. The bylaws
or articles of incorporation may define a "month," but the definition must require a calendar
month to have at least 16 days of active service. If the bylaws or articles of incorporation
do not define a "month," a "month" is a completed calendar month of active service measured
from the member's date of entry to the same date in the subsequent month. The service
pension earned by a volunteer firefighter under this chapter and the articles of incorporation
and bylaws of the volunteer firefighters relief association may be paid whether or not the
municipality or independent nonprofit firefighting corporation to which the relief association
is associated qualifies for the receipt of fire state aid under chapter deleted text begin 69 deleted text end new text begin 477B new text end .

(b) In the case of a member who has completed at least five years of active service as
an active member of the fire department to which the relief association is associated on the
date that the relief association is established and incorporated, the requirement that the
member complete at least five years of active membership with the relief association before
separation from active service may be waived by the board of trustees of the relief association
if the member completes at least five years of inactive membership with the relief association
before the date of the payment of the service pension. During the period of inactive
membership, the member is not entitled to receive disability benefit coverage, is not entitled
to receive additional service credit towards computation of a service pension, and is
considered to have the status of a person entitled to a deferred service pension under
subdivision 7.

(c) No municipality, independent nonprofit firefighting corporation, or joint powers
entity may delegate the power to take final action in setting a service pension or ancillary
benefit amount or level to the board of trustees of the relief association or to approve in
advance a service pension or ancillary benefit amount or level equal to the maximum amount
or level that this chapter would allow rather than a specific dollar amount or level.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 18.

Minnesota Statutes 2018, section 424A.02, subdivision 3a, is amended to read:

Subd. 3a.

Penalty for paying pension greater than applicable maximum.

(a) If a
defined benefit relief association pays a service pension greater than the maximum service
pension associated with the applicable average amount of available financing per active
covered firefighter under the table in subdivision 3, paragraph (c) or (d), whichever applies,
the maximum service pension under subdivision 3, paragraph (f), or the applicable maximum
service pension amount specified in subdivision 3, paragraph (g), whichever is less, the
state auditor shall:

(1) disqualify the municipality or the independent nonprofit firefighting corporation
associated with the relief association from receiving fire state aid by making the appropriate
notification to the municipality and the commissioner of revenue, with the disqualification
applicable for the next apportionment and payment of fire state aid; and

(2) order the treasurer of the applicable relief association to recover the amount of the
overpaid service pension or pensions from any retired firefighter who received an
overpayment.

(b) Fire state aid amounts from disqualified municipalities for the period of
disqualifications under paragraph (a), clause (1), must be credited to the amount of fire
insurance premium tax proceeds available for the next subsequent fire state aid
apportionment.

(c) The amount of any overpaid service pension recovered under paragraph (a), clause
(2), must be credited to the amount of fire insurance premium tax proceeds available for
the next subsequent fire state aid apportionment.

(d) The determination of the state auditor that a relief association has paid a service
pension greater than the applicable maximum must be made on the basis of the information
filed by the relief association and the municipality with the state auditor under deleted text begin sections
69.011, subdivision 2, and 69.051, subdivision 1 or 1a, whichever applies, deleted text end new text begin this chapter new text end and
any other relevant information that comes to the attention of the state auditor. The
determination of the state auditor is final. An aggrieved municipality, relief association, or
person may appeal the determination under section 480A.06.

(e) The state auditor may certify, upon learning that a relief association overpaid a service
pension based on an error in the maximum service pension calculation, the municipality or
independent nonprofit firefighting corporation associated with the relief association for fire
state aid if (1) there is evidence that the error occurred in good faith, and (2) the relief
association has initiated recovery of any overpayment amount. Notwithstanding paragraph
(c), all overpayments recovered under this paragraph must be credited to the relief
association's special fund.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 19.

Minnesota Statutes 2018, section 424A.02, subdivision 10, is amended to read:

Subd. 10.

Local approval of bylaw amendments; filing requirements.

(a) Each defined
benefit relief association to which this section applies must file a revised copy of its governing
bylaws with the state auditor upon the adoption of any amendment to its governing bylaws
by the relief association or upon the approval of any amendment to its governing bylaws
granted by the governing body of each municipality served by the fire department to which
the relief association is directly associated. Failure of the relief association to file a copy of
the bylaws or any bylaw amendments with the state auditor disqualifies the municipality
from the distribution of any future fire state aid until this filing requirement has been
completed.

(b) If the special fund of the relief association does not have a surplus over full funding
under section 424A.092, subdivision 3, paragraph (c), clause (5), or 424A.093, subdivision
4, and if the municipality is required to provide financial support to the special fund of the
relief association under section 424A.092 or 424A.093, no bylaw amendment which would
affect the amount of, the manner of payment of, or the conditions for qualification for service
pensions or ancillary benefits or disbursements other than administrative expenses authorized
under section deleted text begin 69.80 deleted text end new text begin 424A.05, subdivision 3b, new text end payable from the special fund of the relief
association is effective until it has been ratified as required under section 424A.092,
subdivision 6, or 424A.093, subdivision 6. If the special fund of the relief association has
a surplus over full funding under section 424A.092, subdivision 3, or 424A.093, subdivision
4, and if the municipality is not required to provide financial support to the special fund
under this section, the relief association may adopt or amend without municipal ratification
its articles of incorporation or bylaws which increase or otherwise affect the service pensions
or ancillary benefits payable from the special fund if authorized under section 424A.092,
subdivision 6, or 424A.093, subdivision 6.

(c) If the relief association pays only a lump-sum pension, the financial requirements
are to be determined by the board of trustees following the preparation of an estimate of
the expected increase in the accrued liability and annual accruing liability of the relief
association attributable to the change. If the relief association pays a monthly benefit service
pension, the financial requirements are to be determined by the board of trustees following
either an updated actuarial valuation including the proposed change or an estimate of the
expected actuarial impact of the proposed change prepared by the actuary of the relief
association. If a relief association adopts or amends its articles of incorporation or bylaws
without municipal ratification under this subdivision, and, subsequent to the amendment or
adoption, the financial requirements of the special fund under this section are such so as to
require financial support from the municipality, the provision which was implemented
without municipal ratification is no longer effective without municipal ratification, and any
service pensions or ancillary benefits payable after that date must be paid only in accordance
with the articles of incorporation or bylaws as amended or adopted with municipal
ratification.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 20.

Minnesota Statutes 2018, section 424A.03, subdivision 2, is amended to read:

Subd. 2.

Penalties for violations.

A municipality which has a fire department associated
with a relief association which violates the provisions of subdivision 1 is directly associated
or which contracts with an independent nonprofit firefighting corporation associated with
a relief association which violates the provisions of subdivision 1 is a subsidiary may not
be included in the apportionment of fire state aid deleted text begin to the applicable county auditor deleted text end new text begin and police
and firefighter retirement supplemental state aid payable new text end under deleted text begin section 69.021, subdivision
6, deleted text end new text begin chapter 477B and section 423A.022 new text end and may not be included in the apportionment of
fire state aid deleted text begin by the county auditor deleted text end to the various municipalities under section deleted text begin 69.021,
subdivision 7 deleted text end new text begin 477B.03 new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 21.

Minnesota Statutes 2018, section 424A.05, subdivision 2, is amended to read:

Subd. 2.

Special fund assets and revenues.

The special fund must be credited with all
fire state aid and police and firefighter retirement supplemental state aid received under
deleted text begin sections 69.011 to 69.051 deleted text end new text begin chapter 477B new text end and new text begin section new text end 423A.022, all taxes levied by or other
revenues received from the municipality under sections 424A.091 to 424A.096 or any
applicable special law requiring municipal support for the relief association, any funds or
property donated, given, granted or devised by any person which is specified for use for the
support of the special fund and any interest or investment return earned upon the assets of
the special fund. The treasurer of the relief association is the custodian of the assets of the
special fund and must be the recipient on behalf of the special fund of all revenues payable
to the special fund. The treasurer shall maintain adequate records documenting any
transaction involving the assets or the revenues of the special fund. These records and the
bylaws of the relief association are public and must be open for inspection by any member
of the relief association, any officer or employee of the state or of the municipality, or any
member of the public, at reasonable times and places.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 22.

Minnesota Statutes 2018, section 424A.05, subdivision 3, is amended to read:

Subd. 3.

Authorized disbursements from special fund.

(a) Disbursements from the
special fund may not be made for any purpose other than one of the following:

(1) for the payment of service pensions to retired members of the relief association if
authorized and paid under law and the bylaws governing the relief association;

(2) for the purchase of an annuity for the applicable person under section 424A.015,
subdivision 3, for the transfer of service pension or benefit amounts to the applicable person's
individual retirement account under section 424A.015, subdivision 4, or to the applicable
person's account in the Minnesota deferred compensation plan under section 424A.015,
subdivision 5;

(3) for the payment of temporary or permanent disability benefits to disabled members
of the relief association if authorized and paid under law and specified in amount in the
bylaws governing the relief association;

(4) for the payment of survivor benefits or for the payment of a death benefit to the estate
of the deceased active or deferred firefighter, if authorized and paid under law and specified
in amount in the bylaws governing the relief association;

(5) for the payment of the fees, dues and assessments to the Minnesota State Fire
Department Association and to the Minnesota State Fire Chiefs Association in order to
entitle relief association members to membership in and the benefits of these associations
or organizations;

(6) for the payment of insurance premiums to the state Volunteer Firefighters Benefit
Association, or an insurance company licensed by the state of Minnesota offering casualty
insurance, in order to entitle relief association members to membership in and the benefits
of the association or organization; and

(7) for the payment of administrative expenses of the relief association as authorized
under deleted text begin section 69.80 deleted text end new text begin subdivision 3b new text end .

(b) Checks or authorizations for electronic fund transfers for disbursements authorized
by this section must be signed by the relief association treasurer and at least one other elected
trustee who has been designated by the board of trustees to sign the checks or authorizations.
A relief association may make disbursements authorized by this subdivision by electronic
fund transfers only if the specific method of payment and internal control policies and
procedures regarding the method are approved by the board of trustees.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 23.

Minnesota Statutes 2018, section 424A.07, is amended to read:

424A.07 NONPROFIT FIREFIGHTING CORPORATIONS; ESTABLISHMENT
OF RELIEF ASSOCIATIONS.

Before paying any service pensions or retirement benefits under section 424A.02 or
before becoming entitled to receive any amounts of fire state aid upon transmittal from a
contracting municipality under section deleted text begin 69.031, subdivision 5 deleted text end new text begin 477B.04, subdivision 3 new text end , an
independent nonprofit firefighting corporation shall establish a volunteer firefighters relief
association governed by this chapter.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 24.

Minnesota Statutes 2018, section 424A.091, subdivision 3, is amended to read:

Subd. 3.

Remedy for noncompliance; determination.

(a) A municipality in which
there exists a firefighters relief association as specified in subdivision 1 which does not
comply with the applicable provisions of sections 424A.091 to 424A.096 or the provisions
of any applicable special law relating to the funding or financing of the association does
not qualify initially to receive, and is not entitled subsequently to retain, fire state aid under
deleted text begin sections 69.011 to 69.051 deleted text end new text begin chapter 477B new text end until the reason for the disqualification specified
by the state auditor is remedied, whereupon the municipality or relief association, if otherwise
qualified, is entitled to again receive fire state aid for the year occurring immediately
subsequent to the year in which the disqualification is remedied.

(b) The state auditor shall determine if a municipality to which a firefighters' relief
association is directly associated or a firefighters relief association fails to comply with the
provisions of sections 424A.091 to 424A.096 or the funding or financing provisions of any
applicable special law based upon the information contained in the annual financial report
of the firefighters relief association required under section deleted text begin 69.051 deleted text end new text begin 424A.014 new text end , the actuarial
valuation of the relief association, if applicable, the relief association officers' financial
requirements of the relief association and minimum municipal obligation determination
documentation under section 424A.092, subdivisions 3 and 4; 424A.093, subdivisions 4
and 5; or 424A.094, subdivision 2, if requested to be filed by the state auditor, the applicable
municipal or independent nonprofit firefighting corporation budget, if requested to be filed
by the state auditor, and any other relevant documents or reports obtained by the state
auditor.

(c) The municipality or independent nonprofit firefighting corporation and the associated
relief association are not eligible to receive or to retain fire state aid if:

(1) the relief association fails to prepare or to file the financial report or financial
statement under section deleted text begin 69.051 deleted text end new text begin 424A.014 new text end ;

(2) the relief association treasurer is not bonded in the manner and in the amount required
by deleted text begin section 69.051, subdivision 2 deleted text end new text begin 424A.014, subdivision 4 new text end ;

(3) the relief association officers fail to determine or improperly determine the accrued
liability and the annual accruing liability of the relief association under section 424A.092,
subdivisions 2, 2a, and 3, paragraph (c), clause (2), if applicable;

(4) if applicable, the relief association officers fail to obtain and file a required actuarial
valuation or the officers file an actuarial valuation that does not contain the special fund
actuarial liability calculated under the entry age normal actuarial cost method, the special
fund current assets, the special fund unfunded actuarial accrued liability, the special fund
normal cost under the entry age normal actuarial cost method, the amortization requirement
for the special fund unfunded actuarial accrued liability by the applicable target date, a
summary of the applicable benefit plan, a summary of the membership of the relief
association, a summary of the actuarial assumptions used in preparing the valuation, and a
signed statement by the actuary attesting to its results and certifying to the qualifications of
the actuary as an approved actuary under section 356.215, subdivision 1, paragraph (c);

(5) the municipality failed to provide a municipal contribution, or the independent
nonprofit firefighting corporation failed to provide a corporate contribution, in the amount
equal to the minimum municipal obligation if the relief association is governed under section
424A.092, or the amount necessary, when added to the fire state aid actually received in
the plan year in question, to at least equal in total the calculated annual financial requirements
of the special fund of the relief association if the relief association is governed under section
424A.093, and, if the municipal or corporate contribution is deficient, the municipality
failed to include the minimum municipal obligation certified under section 424A.092,
subdivision 3, or 424A.093, subdivision 5, in its budget and tax levy or the independent
nonprofit firefighting corporation failed to include the minimum corporate obligation certified
under section 424A.094, subdivision 2, in the corporate budget;

(6) the defined benefit relief association did not receive municipal ratification for the
most recent plan amendment when municipal ratification was required under section 424A.02,
subdivision 10; 424A.092, subdivision 6; or 424A.093, subdivision 6;

(7) the relief association invested special fund assets in an investment security that is
not authorized under section 424A.095;

(8) the relief association had an administrative expense that is not authorized under
section deleted text begin 69.80 or deleted text end 424A.05, subdivision 3 new text begin or 3b new text end , or the municipality had an expenditure that
is not authorized under section 424A.08;

(9) the relief association officers fail to provide a complete and accurate public pension
plan investment portfolio and performance disclosure under section 356.219;

(10) the relief association fails to obtain the acknowledgment from a broker of the
statement of investment restrictions under section 356A.06, subdivision 8b;

(11) the relief association officers permitted to occur a prohibited transaction under
section 356A.06, subdivision 9, or 424A.04, subdivision 2a, or failed to undertake correction
of a prohibited transaction that did occur; or

(12) the relief association pays a defined benefit service pension in an amount that is in
excess of the applicable service pension maximum under section 424A.02, subdivision 3.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019, except the reference to
Minnesota Statutes, chapter 477B, is effective for aids payable in 2020 and thereafter.
new text end

Sec. 25.

Minnesota Statutes 2018, section 424A.092, subdivision 3, is amended to read:

Subd. 3.

Financial requirements of relief association; minimum obligation of
municipality.

(a) During the month of July, the officers of the relief association shall
determine the overall funding balance of the special fund for the current calendar year, the
financial requirements of the special fund for the following calendar year and the minimum
obligation of the municipality with respect to the special fund for the following calendar
year in accordance with the requirements of this subdivision.

(b) The overall funding balance of the special fund for the current calendar year must
be determined in the following manner:

(1) The total accrued liability of the special fund for all active and deferred members of
the relief association as of December 31 of the current year must be calculated under
subdivisions 2 and 2a, if applicable.

(2) The total present assets of the special fund projected to December 31 of the current
year, including receipts by and disbursements from the special fund anticipated to occur on
or before December 31, must be calculated. To the extent possible, for those assets for which
a market value is readily ascertainable, the current market value as of the date of the
calculation for those assets must be utilized in making this calculation. For any asset for
which no market value is readily ascertainable, the cost value or the book value, whichever
is applicable, must be utilized in making this calculation.

(3) The amount of the total present assets of the special fund calculated under clause (2)
must be subtracted from the amount of the total accrued liability of the special fund calculated
under clause (1). If the amount of total present assets exceeds the amount of the total accrued
liability, then the special fund is considered to have a surplus over full funding. If the amount
of the total present assets is less than the amount of the total accrued liability, then the
special fund is considered to have a deficit from full funding. If the amount of total present
assets is equal to the amount of the total accrued liability, then the special fund is considered
to be fully funded.

(c) The financial requirements of the special fund for the following calendar year must
be determined in the following manner:

(1) The total accrued liability of the special fund for all active and deferred members of
the relief association as of December 31 of the calendar year next following the current
calendar year must be calculated under subdivisions 2 and 2a, if applicable.

(2) The increase in the total accrued liability of the special fund for the following calendar
year over the total accrued liability of the special fund for the current year must be calculated.

(3) The amount of anticipated future administrative expenses of the special fund must
be calculated by multiplying the dollar amount of the administrative expenses of the special
fund for the most recent prior calendar year by the factor of 1.035.

(4) If the special fund is fully funded, the financial requirements of the special fund for
the following calendar year are the total of the amounts calculated under clauses (2) and
(3).

(5) If the special fund has a deficit from full funding, the financial requirements of the
special fund for the following calendar year are the financial requirements of the special
fund calculated as though the special fund were fully funded under clause (4) plus an amount
equal to one-tenth of the original amount of the deficit from full funding of the special fund
as determined under clause (2) resulting either from an increase in the amount of the service
pension occurring in the last ten years or from a net annual investment loss occurring during
the last ten years until each increase in the deficit from full funding is fully retired. The
annual amortization contribution under this clause may not exceed the amount of the deficit
from full funding.

(6) If the special fund has a surplus over full funding, the financial requirements of the
special fund for the following calendar year are the financial requirements of the special
fund calculated as though the special fund were fully funded under clause (4) reduced by
an amount equal to one-tenth of the amount of the surplus over full funding of the special
fund.

(d) The minimum obligation of the municipality with respect to the special fund is the
financial requirements of the special fund reduced by the amount of any fire state aid and
police and firefighter retirement supplemental state aid payable under deleted text begin sections 69.011 to
69.051 deleted text end new text begin chapter 477B new text end and new text begin section new text end 423A.022 reasonably anticipated to be received by the
municipality for transmittal to the special fund during the following calendar year, an amount
of interest on the assets of the special fund projected to the beginning of the following
calendar year calculated at the rate of five percent per annum, and the amount of any
contributions to the special fund required by the relief association bylaws from the active
members of the relief association reasonably anticipated to be received during the following
calendar year. A reasonable amount of anticipated fire state aid is an amount that does not
exceed the fire state aid actually received in the prior year multiplied by the factor 1.035.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for aids payable in 2020 and thereafter.
new text end

Sec. 26.

Minnesota Statutes 2018, section 424A.092, subdivision 4, is amended to read:

Subd. 4.

Certification of financial requirements and minimum municipal obligation;
levy.

(a) The officers of the relief association shall certify the financial requirements of the
special fund of the relief association and the minimum obligation of the municipality with
respect to the special fund of the relief association as determined under subdivision 3 on or
before August 1 of each year. The certification must be made to the entity that is responsible
for satisfying the minimum obligation with respect to the special fund of the relief association.
If the responsible entity is a joint powers entity, the certification must be made in the manner
specified in the joint powers agreement, or if the joint powers agreement is silent on this
point, the certification must be made to the chair of the joint powers board.

(b) The financial requirements of the relief association and the minimum municipal
obligation must be included in the financial report or financial statement under section
deleted text begin 69.051 deleted text end new text begin 424A.014 new text end . The schedule forms related to the determination of the financial
requirements must be filed with the state auditor by March 31, annually, if the relief
association is required to file a financial statement under section deleted text begin 69.051, subdivision 1a deleted text end new text begin
424A.014, subdivision 2 new text end , or by June 30, annually, if the relief association is required to file
a financial report and audit under section deleted text begin 69.051, subdivision 1 deleted text end new text begin 424A.014, subdivision 1 new text end .

(c) The municipality shall provide for at least the minimum obligation of the municipality
with respect to the special fund of the relief association by tax levy or from any other source
of public revenue.

(d) The municipality may levy taxes for the payment of the minimum municipal obligation
without any limitation as to rate or amount and irrespective of any limitations imposed by
other provisions of law upon the rate or amount of taxation until the balance of the special
fund or any fund of the relief association has attained a specified level. In addition, any
taxes levied under this section must not cause the amount or rate of any other taxes levied
in that year or to be levied in a subsequent year by the municipality which are subject to a
limitation as to rate or amount to be reduced.

(e) If the municipality does not include the full amount of the minimum municipal
obligations in its levy for any year, the officers of the relief association shall certify that
amount to the county auditor, who shall spread a levy in the amount of the certified minimum
municipal obligation on the taxable property of the municipality.

(f) If the state auditor determines that a municipal contribution actually made in a plan
year was insufficient under section 424A.091, subdivision 3, paragraph (c), clause (5), the
state auditor may request a copy of the certifications under this subdivision from the relief
association or from the city. The relief association or the city, whichever applies, must
provide the certifications within 14 days of the date of the request from the state auditor.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 27.

Minnesota Statutes 2018, section 424A.093, subdivision 5, is amended to read:

Subd. 5.

Minimum municipal obligation.

(a) The officers of the relief association shall
determine the minimum obligation of the municipality with respect to the special fund of
the relief association for the following calendar year on or before August 1 of each year in
accordance with the requirements of this subdivision.

(b) The minimum obligation of the municipality with respect to the special fund is an
amount equal to the financial requirements of the special fund of the relief association
determined under subdivision 4, reduced by the estimated amount of any fire state aid and
police and firefighter retirement supplemental state aid payable under deleted text begin sections 69.011 to
69.051 deleted text end new text begin chapter 477B new text end and new text begin section new text end 423A.022 reasonably anticipated to be received by the
municipality for transmittal to the special fund of the relief association during the following
year and the amount of any anticipated contributions to the special fund required by the
relief association bylaws from the active members of the relief association reasonably
anticipated to be received during the following calendar year. A reasonable amount of
anticipated fire state aid is an amount that does not exceed the fire state aid actually received
in the prior year multiplied by the factor 1.035.

(c) The officers of the relief association shall certify the financial requirements of the
special fund of the relief association and the minimum obligation of the municipality with
respect to the special fund of the relief association as determined under subdivision 4 and
this subdivision by August 1 of each year. The certification must be made to the entity that
is responsible for satisfying the minimum obligation with respect to the special fund of the
relief association. If the responsible entity is a joint powers entity, the certification must be
made in the manner specified in the joint powers agreement, or if the joint powers agreement
is silent on this point, the certification must be made to the chair of the joint powers board.

(d) The financial requirements of the relief association and the minimum municipal
obligation must be included in the financial report or financial statement under section
deleted text begin 69.051 deleted text end new text begin 424A.014 new text end .

(e) The municipality shall provide for at least the minimum obligation of the municipality
with respect to the special fund of the relief association by tax levy or from any other source
of public revenue. The municipality may levy taxes for the payment of the minimum
municipal obligation without any limitation as to rate or amount and irrespective of any
limitations imposed by other provisions of law or charter upon the rate or amount of taxation
until the balance of the special fund or any fund of the relief association has attained a
specified level. In addition, any taxes levied under this section must not cause the amount
or rate of any other taxes levied in that year or to be levied in a subsequent year by the
municipality which are subject to a limitation as to rate or amount to be reduced.

(f) If the municipality does not include the full amount of the minimum municipal
obligation in its levy for any year, the officers of the relief association shall certify that
amount to the county auditor, who shall spread a levy in the amount of the minimum
municipal obligation on the taxable property of the municipality.

(g) If the state auditor determines that a municipal contribution actually made in a plan
year was insufficient under section 424A.091, subdivision 3, paragraph (c), clause (5), the
state auditor may request from the relief association or from the city a copy of the
certifications under this subdivision. The relief association or the city, whichever applies,
must provide the certifications within 14 days of the date of the request from the state auditor.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019, except the reference to
Minnesota Statutes, chapter 477B, is effective for aids payable in 2020 and thereafter.
new text end

Sec. 28.

Minnesota Statutes 2018, section 424B.09, is amended to read:

424B.09 ADMINISTRATIVE EXPENSES.

The payment of authorized administrative expenses of the subsequent volunteer
firefighters relief association must be from the special fund of the subsequent volunteer
firefighters relief association in accordance with section deleted text begin 69.80 deleted text end new text begin 424A.05, subdivision 3b new text end ,
and as provided for in the bylaws of the subsequent volunteer firefighters relief association
and approved by the board of trustees of the subsequent volunteer firefighters relief
association. The payment of any other expenses of the subsequent volunteer firefighters
relief association must be from the general fund of the subsequent volunteer firefighters
relief association in accordance with section deleted text begin 69.80 deleted text end new text begin 424A.05, subdivision 3b, new text end and as provided
for in the bylaws of the subsequent volunteer firefighters relief association and approved
by the board of trustees of the subsequent volunteer firefighters relief association.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 29. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2018, section 69.022, new text end new text begin is repealed.
new text end

new text begin EFFECTIVE DATE. new text end

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

ARTICLE 11

DEPARTMENT OF REVENUE; MISCELLANEOUS; POLICY CHANGES

Section 1.

Minnesota Statutes 2018, section 270B.08, subdivision 2, is amended to read:

Subd. 2.

Revocation new text begin or cancellation new text end .

When a taxpayer's sales tax permit has been
revoked new text begin or canceled new text end under section 270C.722 new text begin or 297A.84 new text end , the commissioner may disclose new text begin
to any person new text end data identifying the holder of the revoked new text begin or canceled new text end permit, deleted text begin stating deleted text end the basis
for the revocation new text begin or cancellation, the date of the revocation or cancellation new text end , and deleted text begin stating
whether the deleted text end new text begin if a revoked or canceled new text end permit has been reinstated new text begin , the date upon which the
permit was reinstated new text end .

new text begin EFFECTIVE DATE. new text end

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

Sec. 2.

Minnesota Statutes 2018, section 297A.84, is amended to read:

297A.84 PERMITS ISSUED new text begin AND NOT ISSUED; CANCELLATION new text end .

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) The following definitions apply for the purposes of this
section.
new text end

new text begin (b) "Applicant" means an individual, corporation, or partnership. Applicant also includes
any officer of a corporation or member of a partnership.
new text end

new text begin (c) "Delinquent sales tax" means tax not paid by the date the tax was due and payable
under section 289A.20, subdivision 4, or an assessment not paid if the applicant has been
issued an order assessing sales and use tax under section 270C.33, subdivision 4.
new text end

new text begin Subd. 2. new text end

new text begin Permits issued. new text end

new text begin Except as provided in subdivision 3, new text end the commissioner deleted text begin shall deleted text end new text begin
must new text end issue a permit to each applicant who has complied with section 297A.83, and with
section 297A.92 if security is required. A person is considered to have a permit if the person
has a Minnesota tax identification number issued by the commissioner that is currently
active for taxes imposed by this chapter. A permit is valid until canceled or revoked. It is
not assignable and is valid only for the person in whose name it is granted and for the
transaction of business at the places designated on the permit.

new text begin Subd. 3. new text end

new text begin Permits not issued. new text end

new text begin (a) Except as provided in paragraph (b), the commissioner
must not issue a permit to an applicant if the applicant is liable for delinquent sales tax.
new text end

new text begin (b) The commissioner must issue a permit to an applicant if an appeal period of an order
assessing sales tax under section 270C.33, subdivision 5, has not ended. The commissioner
may cancel a permit issued under this paragraph in the manner provided in subdivision 4
if the applicant owes delinquent sales tax after the appeal period has ended.
new text end

new text begin Subd. 4. new text end

new text begin Nonconforming permits; cancellation; reissue. new text end

new text begin (a) If the commissioner issues
a permit that does not conform with the requirements of this section or applicable rules, the
commissioner may cancel the permit upon notice to the permit holder. The notice must be
served by first class and certified mail at the permit holder's last known address. The
cancellation is effective immediately.
new text end

new text begin (b) If a permit holder shows that a canceled permit was issued in conformance with the
requirements of this section and applicable rules, the commissioner must reissue the permit.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for permit applications filed after
December 31, 2019.
new text end

Sec. 3.

Minnesota Statutes 2018, section 297A.85, is amended to read:

297A.85 CANCELLATION OF PERMITS.

The commissioner may cancel a permit if one of the following conditions occurs:

(1) the permit holder has not filed a sales or use tax return for at least one year;

(2) the permit holder has not reported any sales or use tax liability on the permit holder's
returns for at least two years;

(3) the permit holder requests cancellation of the permit; deleted text begin or
deleted text end

(4) the permit is subject to cancellation deleted text begin pursuant to deleted text end new text begin under new text end section 270C.722, subdivision
2, paragraph (a) deleted text begin . deleted text end new text begin ; or
new text end

new text begin (5) the permit is subject to cancellation under section 297A.84.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for permit applications filed after
December 31, 2019.
new text end

Sec. 4. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2018, section 270C.131, new text end new text begin is repealed.
new text end

new text begin EFFECTIVE DATE. new text end

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

ARTICLE 12

DEPARTMENT OF REVENUE; MISCELLANEOUS; TECHNICAL CHANGES

Section 1.

Minnesota Statutes 2018, section 272.02, subdivision 27, is amended to read:

Subd. 27.

Superior National Forest; recreational property for use by deleted text begin disabled deleted text end
veterans new text begin with a disability new text end .

Real and personal property is exempt if it is located in the
Superior National Forest, and owned or leased and operated by a nonprofit organization
that is exempt from federal income taxation under section 501(c)(3) of the Internal Revenue
Code and primarily used to provide recreational opportunities for deleted text begin disabled deleted text end veterans new text begin with a
disability new text end and their families.

new text begin EFFECTIVE DATE. new text end

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

Sec. 2.

Minnesota Statutes 2018, section 272.02, subdivision 81, is amended to read:

Subd. 81.

Certain recreational property for deleted text begin disabled deleted text end veterans new text begin with a disability new text end .

Real
and personal property is exempt if it is located in a county in the metropolitan area with a
population of less than 500,000 according to the 2000 federal census, and owned or leased
and operated by a nonprofit organization, and primarily used to provide recreational
opportunities for deleted text begin disabled deleted text end veterans new text begin with a disability new text end and their families.

new text begin EFFECTIVE DATE. new text end

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

Sec. 3.

Minnesota Statutes 2018, section 273.032, is amended to read:

273.032 MARKET VALUE DEFINITION.

(a) Unless otherwise provided, for the purpose of determining any property tax levy
limitation based on market value or any limit on net debt, the issuance of bonds, certificates
of indebtedness, or capital notes based on market value, any qualification to receive state
aid based on market value, or any state aid amount based on market value, the terms "market
value," "estimated market value," and "market valuation," whether equalized or unequalized,
mean the estimated market value of taxable property within the local unit of government
before any of the following or similar adjustments for:

(1) the market value exclusions under:

(i) section 273.11, subdivisions 14a and 14c (vacant platted land);

(ii) section 273.11, subdivision 16 (certain improvements to homestead property);

(iii) section 273.11, subdivisions 19 and 20 (certain improvements to business properties);

(iv) section 273.11, subdivision 21 (homestead property damaged by mold);

(v) section 273.13, subdivision 34 (homestead of a deleted text begin disabled deleted text end veteran new text begin with a disability new text end or
family caregiver); or

(vi) section 273.13, subdivision 35 (homestead market value exclusion); or

(2) the deferment of value under:

(i) the Minnesota Agricultural Property Tax Law, section 273.111;

(ii) the Aggregate Resource Preservation Law, section 273.1115;

(iii) the Minnesota Open Space Property Tax Law, section 273.112;

(iv) the rural preserves property tax program, section 273.114; or

(v) the Metropolitan Agricultural Preserves Act, section 473H.10; or

(3) the adjustments to tax capacity for:

(i) tax increment financing under sections 469.174 to 469.1794;

(ii) fiscal disparities under chapter 276A or 473F; or

(iii) powerline credit under section 273.425.

(b) Estimated market value under paragraph (a) also includes the market value of
tax-exempt property if the applicable law specifically provides that the limitation,
qualification, or aid calculation includes tax-exempt property.

(c) Unless otherwise provided, "market value," "estimated market value," and "market
valuation" for purposes of property tax levy limitations and calculation of state aid, refer
to the estimated market value for the previous assessment year and for purposes of limits
on net debt, the issuance of bonds, certificates of indebtedness, or capital notes refer to the
estimated market value as last finally equalized.

(d) For purposes of a provision of a home rule charter or of any special law that is not
codified in the statutes and that imposes a levy limitation based on market value or any limit
on debt, the issuance of bonds, certificates of indebtedness, or capital notes based on market
value, the terms "market value," "taxable market value," and "market valuation," whether
equalized or unequalized, mean "estimated market value" as defined in paragraph (a).

new text begin EFFECTIVE DATE. new text end

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

Sec. 4.

Minnesota Statutes 2018, section 273.13, subdivision 22, is amended to read:

Subd. 22.

Class 1.

(a) Except as provided in subdivision 23 and in paragraphs (b) and
(c), real estate which is residential and used for homestead purposes is class 1a. In the case
of a duplex or triplex in which one of the units is used for homestead purposes, the entire
property is deemed to be used for homestead purposes. The market value of class 1a property
must be determined based upon the value of the house, garage, and land.

The first $500,000 of market value of class 1a property has a net classification rate of
one percent of its market value; and the market value of class 1a property that exceeds
$500,000 has a classification rate of 1.25 percent of its market value.

(b) Class 1b property includes homestead real estate or homestead manufactured homes
used for the purposes of a homestead by:

(1) any person who is blind as defined in section 256D.35, or the deleted text begin blind deleted text end person new text begin who is
blind new text end and the deleted text begin blind person's deleted text end spouse new text begin of the person who is blind new text end ;

(2) any person who is permanently and totally disabled or by the deleted text begin disabled deleted text end person new text begin with
a disability new text end and the deleted text begin disabled person's deleted text end spouse new text begin of the person with a disability new text end ; or

(3) the surviving spouse of a new text begin veteran who was new text end permanently and totally disabled deleted text begin veteran deleted text end
homesteading a property classified under this paragraph for taxes payable in 2008.

Property is classified and assessed under clause (2) only if the government agency or
income-providing source certifies, upon the request of the homestead occupant, that the
homestead occupant satisfies the disability requirements of this paragraph, and that the
property is not eligible for the valuation exclusion under subdivision 34.

Property is classified and assessed under paragraph (b) only if the commissioner of
revenue or the county assessor certifies that the homestead occupant satisfies the requirements
of this paragraph.

Permanently and totally disabled for the purpose of this subdivision means a condition
which is permanent in nature and totally incapacitates the person from working at an
occupation which brings the person an income. The first $50,000 market value of class 1b
property has a net classification rate of .45 percent of its market value. The remaining market
value of class 1b property is classified as class 1a or class 2a property, whichever is
appropriate.

(c) Class 1c property is commercial use real and personal property that abuts public
water as defined in section 103G.005, subdivision 15, or abuts a state trail administered by
the Department of Natural Resources, and is devoted to temporary and seasonal residential
occupancy for recreational purposes but not devoted to commercial purposes for more than
250 days in the year preceding the year of assessment, and that includes a portion used as
a homestead by the owner, which includes a dwelling occupied as a homestead by a
shareholder of a corporation that owns the resort, a partner in a partnership that owns the
resort, or a member of a limited liability company that owns the resort even if the title to
the homestead is held by the corporation, partnership, or limited liability company. For
purposes of this paragraph, property is devoted to a commercial purpose on a specific day
if any portion of the property, excluding the portion used exclusively as a homestead, is
used for residential occupancy and a fee is charged for residential occupancy. Class 1c
property must contain three or more rental units. A "rental unit" is defined as a cabin,
condominium, townhouse, sleeping room, or individual camping site equipped with water
and electrical hookups for recreational vehicles. Class 1c property must provide recreational
activities such as the rental of ice fishing houses, boats and motors, snowmobiles, downhill
or cross-country ski equipment; provide marina services, launch services, or guide services;
or sell bait and fishing tackle. Any unit in which the right to use the property is transferred
to an individual or entity by deeded interest, or the sale of shares or stock, no longer qualifies
for class 1c even though it may remain available for rent. A camping pad offered for rent
by a property that otherwise qualifies for class 1c is also class 1c, regardless of the term of
the rental agreement, as long as the use of the camping pad does not exceed 250 days. If
the same owner owns two separate parcels that are located in the same township, and one
of those properties is classified as a class 1c property and the other would be eligible to be
classified as a class 1c property if it was used as the homestead of the owner, both properties
will be assessed as a single class 1c property; for purposes of this sentence, properties are
deemed to be owned by the same owner if each of them is owned by a limited liability
company, and both limited liability companies have the same membership. The portion of
the property used as a homestead is class 1a property under paragraph (a). The remainder
of the property is classified as follows: the first $600,000 of market value is tier I, the next
$1,700,000 of market value is tier II, and any remaining market value is tier III. The
classification rates for class 1c are: tier I, 0.50 percent; tier II, 1.0 percent; and tier III, 1.25
percent. Owners of real and personal property devoted to temporary and seasonal residential
occupancy for recreation purposes in which all or a portion of the property was devoted to
commercial purposes for not more than 250 days in the year preceding the year of assessment
desiring classification as class 1c, must submit a declaration to the assessor designating the
cabins or units occupied for 250 days or less in the year preceding the year of assessment
by January 15 of the assessment year. Those cabins or units and a proportionate share of
the land on which they are located must be designated as class 1c as otherwise provided.
The remainder of the cabins or units and a proportionate share of the land on which they
are located must be designated as class 3a commercial. The owner of property desiring
designation as class 1c property must provide guest registers or other records demonstrating
that the units for which class 1c designation is sought were not occupied for more than 250
days in the year preceding the assessment if so requested. The portion of a property operated
as a (1) restaurant, (2) bar, (3) gift shop, (4) conference center or meeting room, and (5)
other nonresidential facility operated on a commercial basis not directly related to temporary
and seasonal residential occupancy for recreation purposes does not qualify for class 1c.

(d) Class 1d property includes structures that meet all of the following criteria:

(1) the structure is located on property that is classified as agricultural property under
section 273.13, subdivision 23;

(2) the structure is occupied exclusively by seasonal farm workers during the time when
they work on that farm, and the occupants are not charged rent for the privilege of occupying
the property, provided that use of the structure for storage of farm equipment and produce
does not disqualify the property from classification under this paragraph;

(3) the structure meets all applicable health and safety requirements for the appropriate
season; and

(4) the structure is not salable as residential property because it does not comply with
local ordinances relating to location in relation to streets or roads.

The market value of class 1d property has the same classification rates as class 1a property
under paragraph (a).

new text begin EFFECTIVE DATE. new text end

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

Sec. 5.

Minnesota Statutes 2018, section 273.13, subdivision 34, is amended to read:

Subd. 34.

Homestead of deleted text begin disabled deleted text end veteran new text begin with a disability new text end or family caregiver.

(a)
All or a portion of the market value of property owned by a veteran and serving as the
veteran's homestead under this section is excluded in determining the property's taxable
market value if the veteran has a service-connected disability of 70 percent or more as
certified by the United States Department of Veterans Affairs. To qualify for exclusion
under this subdivision, the veteran must have been honorably discharged from the United
States armed forces, as indicated by United States Government Form DD214 or other official
military discharge papers.

(b)(1) For a disability rating of 70 percent or more, $150,000 of market value is excluded,
except as provided in clause (2); and

(2) for a total (100 percent) and permanent disability, $300,000 of market value is
excluded.

(c) If a deleted text begin disabled deleted text end veteran new text begin with a disability new text end qualifying for a valuation exclusion under
paragraph (b), clause (2), predeceases the veteran's spouse, and if upon the death of the
veteran the spouse holds the legal or beneficial title to the homestead and permanently
resides there, the exclusion shall carry over to the benefit of the veteran's spouse for the
current taxes payable year and for eight additional taxes payable years or until such time
as the spouse remarries, or sells, transfers, or otherwise disposes of the property, whichever
comes first. Qualification under this paragraph requires an application under paragraph (h),
and a spouse must notify the assessor if there is a change in the spouse's marital status,
ownership of the property, or use of the property as a permanent residence.

(d) If the spouse of a member of any branch or unit of the United States armed forces
who dies due to a service-connected cause while serving honorably in active service, as
indicated on United States Government Form DD1300 or DD2064, holds the legal or
beneficial title to a homestead and permanently resides there, the spouse is entitled to the
benefit described in paragraph (b), clause (2), for eight taxes payable years, or until such
time as the spouse remarries or sells, transfers, or otherwise disposes of the property,
whichever comes first.

(e) If a veteran meets the disability criteria of paragraph (a) but does not own property
classified as homestead in the state of Minnesota, then the homestead of the veteran's primary
family caregiver, if any, is eligible for the exclusion that the veteran would otherwise qualify
for under paragraph (b).

(f) In the case of an agricultural homestead, only the portion of the property consisting
of the house and garage and immediately surrounding one acre of land qualifies for the
valuation exclusion under this subdivision.

(g) A property qualifying for a valuation exclusion under this subdivision is not eligible
for the market value exclusion under subdivision 35, or classification under subdivision 22,
paragraph (b).

(h) To qualify for a valuation exclusion under this subdivision a property owner must
apply to the assessor by July 1 of the first assessment year for which the exclusion is sought.
For an application received after July 1, the exclusion shall become effective for the following
assessment year. Except as provided in paragraph (c), the owner of a property that has been
accepted for a valuation exclusion must notify the assessor if there is a change in ownership
of the property or in the use of the property as a homestead.

(i) A first-time application by a qualifying spouse for the market value exclusion under
paragraph (d) must be made any time within two years of the death of the service member.

(j) For purposes of this subdivision:

(1) "active service" has the meaning given in section 190.05;

(2) "own" means that the person's name is present as an owner on the property deed;

(3) "primary family caregiver" means a person who is approved by the secretary of the
United States Department of Veterans Affairs for assistance as the primary provider of
personal care services for an eligible veteran under the Program of Comprehensive Assistance
for Family Caregivers, codified as United States Code, title 38, section 1720G; and

(4) "veteran" has the meaning given the term in section 197.447.

(k) If a veteran dying after December 31, 2011, did not apply for or receive the exclusion
under paragraph (b), clause (2), before dying, the veteran's spouse is entitled to the benefit
under paragraph (b), clause (2), for eight taxes payable years or until the spouse remarries
or sells, transfers, or otherwise disposes of the property if:

(1) the spouse files a first-time application within two years of the death of the service
member or by June 1, 2019, whichever is later;

(2) upon the death of the veteran, the spouse holds the legal or beneficial title to the
homestead and permanently resides there;

(3) the veteran met the honorable discharge requirements of paragraph (a); and

(4) the United States Department of Veterans Affairs certifies that:

(i) the veteran met the total (100 percent) and permanent disability requirement under
paragraph (b), clause (2); or

(ii) the spouse has been awarded dependency and indemnity compensation.

(l) The purpose of this provision of law providing a level of homestead property tax
relief for deleted text begin gravely disabled deleted text end veterans new text begin with a disability new text end , their primary family caregivers, and
their surviving spouses is to help ease the burdens of war for those among our state's citizens
who bear those burdens most heavily.

(m) By July 1, the county veterans service officer must certify the disability rating and
permanent address of each veteran receiving the benefit under paragraph (b) to the assessor.

new text begin EFFECTIVE DATE. new text end

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

Sec. 6.

Minnesota Statutes 2018, section 289A.08, subdivision 6, is amended to read:

Subd. 6.

Returns of married persons.

deleted text begin A husband and wife deleted text end new text begin Individuals who are married
to each other new text end must file a joint Minnesota income tax return if they filed a joint federal income
tax return. If the deleted text begin husband and wife deleted text end new text begin spouses new text end have elected to file separate federal income tax
returns, they must file separate Minnesota income tax returns. This election to file a joint
or separate return must be changed if they change their election for federal purposes. In the
event taxpayers desire to change their election, the change must be done in the manner and
on the form prescribed by the commissioner.

The determination of whether an individual is married shall be made under the provisions
of section 7703 of the Internal Revenue Code.

new text begin EFFECTIVE DATE. new text end

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

Sec. 7.

Minnesota Statutes 2018, section 289A.25, subdivision 1, is amended to read:

Subdivision 1.

Requirements to pay.

An individual, trust, S corporation, or partnership
must, when prescribed in subdivision 3, paragraph (b), make payments of estimated tax.
For individuals, the term "estimated tax" means the amount the taxpayer estimates is the
sum of the taxes imposed by chapter 290 for the taxable year. For trusts, S corporations,
and partnerships, the term estimated tax means the amount the taxpayer estimates is the
sum of the taxes for the taxable year imposed by chapter 290 and the composite income tax
imposed by section 289A.08, subdivision 7. If the individual is an infant or incompetent
person, the payments must be made by the individual's guardian. If joint payments on
estimated tax are made but a joint return is not made for the taxable year, the estimated tax
for that year may be treated as the estimated tax of either deleted text begin the husband or the wife deleted text end new text begin spouse new text end or
may be divided between them.

new text begin EFFECTIVE DATE. new text end

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

Sec. 8.

Minnesota Statutes 2018, section 289A.31, subdivision 2, is amended to read:

Subd. 2.

Joint income tax returns.

(a) If a joint income tax return is made by deleted text begin a husband
and wife deleted text end new text begin spouses new text end , the liability for the tax is joint and several. A spouse who qualifies for
relief from a liability attributable to an underpayment under section 6015(b) of the Internal
Revenue Code is relieved of the state income tax liability on the underpayment.

(b) In the case of individuals who were deleted text begin a husband and wife deleted text end new text begin married as determined in
section 7703 of the Internal Revenue Code new text end prior to the dissolution of their marriage or their
legal separation, or prior to the death of one of the individuals, for tax liabilities reported
on a joint or combined return, the liability of each person is limited to the proportion of the
tax due on the return that equals that person's proportion of the total tax due if deleted text begin the husband
and wife deleted text end new text begin each spouse new text end filed separate returns for the taxable year. This provision is effective
only when the commissioner receives written notice of the marriage dissolution, legal
separation, or death of a spouse from the deleted text begin husband or wife deleted text end new text begin surviving spouse new text end . No refund may
be claimed by an ex-spouse, legally separated or widowed spouse for any taxes paid more
than 60 days before receipt by the commissioner of the written notice.

(c) A request for calculation of separate liability pursuant to paragraph (b) for taxes
reported on a return must be made within six years after the due date of the return. For
calculation of separate liability for taxes assessed by the commissioner under section 289A.35
or 289A.37, the request must be made within six years after the date of assessment. The
commissioner is not required to calculate separate liability if the remaining unpaid liability
for which recalculation is requested is $100 or less.

new text begin EFFECTIVE DATE. new text end

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

Sec. 9.

Minnesota Statutes 2018, section 289A.37, subdivision 6, is amended to read:

Subd. 6.

Order of assessment if joint income tax return.

If a joint income tax return
is filed by deleted text begin a husband and wife deleted text end new text begin spouses new text end , an order of assessment may be a single joint notice.
If the commissioner has been notified by either spouse that that spouse's address has changed
and if that spouse requests it, then, instead of the single joint notice mailed to the last known
address of the deleted text begin husband and wife deleted text end new text begin spouses new text end , a duplicate or original of the joint notice must be
sent to the requesting spouse at the address designated by the requesting spouse. The other
joint notice must be mailed to the other spouse at that spouse's last known address. An
assessment is not invalid for failure to send it to a spouse if the spouse actually receives the
notice in the same period as if it had been mailed to that spouse at the correct address or if
the spouse has failed to provide an address to the commissioner other than the last known
address.

new text begin EFFECTIVE DATE. new text end

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

Sec. 10.

Minnesota Statutes 2018, section 290.0802, subdivision 2, is amended to read:

Subd. 2.

Subtraction.

(a) A qualified individual is allowed a subtraction from federal
taxable income of the individual's subtraction base amount. The excess of the subtraction
base amount over the taxable net income computed without regard to the subtraction for
the elderly or deleted text begin disabled deleted text end new text begin a person with a disability new text end under section 290.0132, subdivision 5,
may be used to reduce the amount of a lump sum distribution subject to tax under section
290.032.

(b)(1) The initial subtraction base amount equals

(i) $12,000 for a married taxpayer filing a joint return if a spouse is a qualified individual,

(ii) $9,600 for a single taxpayer, and

(iii) $6,000 for a married taxpayer filing a separate federal return.

(2) The qualified individual's initial subtraction base amount, then, must be reduced by
the sum of nontaxable retirement and disability benefits and one-half of the amount of
adjusted gross income in excess of the following thresholds:

(i) $18,000 for a married taxpayer filing a joint return if both spouses are qualified
individuals,

(ii) $14,500 for a single taxpayer or for a married couple filing a joint return if only one
spouse is a qualified individual, and

(iii) $9,000 for a married taxpayer filing a separate federal return.

(3) In the case of a qualified individual who is under the age of 65, the maximum amount
of the subtraction base may not exceed the taxpayer's disability income.

(4) The resulting amount is the subtraction base amount.

new text begin EFFECTIVE DATE. new text end

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

Sec. 11.

Minnesota Statutes 2018, section 290.0802, subdivision 3, is amended to read:

Subd. 3.

Restrictions; married couples.

Except in the case of deleted text begin a husband and wife deleted text end new text begin
spouses new text end who live apart at all times during the taxable year, if the taxpayer is married at the
close of the taxable year, the subtraction under subdivision 2 is allowable only if the taxpayers
file joint federal and state income tax returns for the taxable year.

new text begin EFFECTIVE DATE. new text end

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

Sec. 12.

Minnesota Statutes 2018, section 290.091, subdivision 2, is amended to read:

Subd. 2.

Definitions.

For purposes of the tax imposed by this section, the following
terms have the meanings given.

(a) "Alternative minimum taxable income" means the sum of the following for the taxable
year:

(1) the taxpayer's federal alternative minimum taxable income as defined in section
55(b)(2) of the Internal Revenue Code;

(2) the taxpayer's itemized deductions allowed in computing federal alternative minimum
taxable income, but excluding:

(i) the charitable contribution deduction under section 170 of the Internal Revenue Code;

(ii) the medical expense deduction;

(iii) the casualty, theft, and disaster loss deduction; and

(iv) the impairment-related work expenses of a deleted text begin disabled deleted text end person new text begin with a disability new text end ;

(3) for depletion allowances computed under section 613A(c) of the Internal Revenue
Code, with respect to each property (as defined in section 614 of the Internal Revenue Code),
to the extent not included in federal alternative minimum taxable income, the excess of the
deduction for depletion allowable under section 611 of the Internal Revenue Code for the
taxable year over the adjusted basis of the property at the end of the taxable year (determined
without regard to the depletion deduction for the taxable year);

(4) to the extent not included in federal alternative minimum taxable income, the amount
of the tax preference for intangible drilling cost under section 57(a)(2) of the Internal Revenue
Code determined without regard to subparagraph (E);

(5) to the extent not included in federal alternative minimum taxable income, the amount
of interest income as provided by section 290.0131, subdivision 2; and

(6) the amount of addition required by section 290.0131, subdivisions 9 to 11;

less the sum of the amounts determined under the following:

(i) interest income as defined in section 290.0132, subdivision 2;

(ii) an overpayment of state income tax as provided by section 290.0132, subdivision
3, to the extent included in federal alternative minimum taxable income;

(iii) the amount of investment interest paid or accrued within the taxable year on
indebtedness to the extent that the amount does not exceed net investment income, as defined
in section 163(d)(4) of the Internal Revenue Code. Interest does not include amounts deducted
in computing federal adjusted gross income;

(iv) amounts subtracted from federal taxable income as provided by section 290.0132,
subdivisions 7, 9 to 15, 17, 21, 24, and 26; and

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

In the case of an estate or trust, alternative minimum taxable income must be computed
as provided in section 59(c) of the Internal Revenue Code.

(b) "Investment interest" means investment interest as defined in section 163(d)(3) of
the Internal Revenue Code.

(c) "Net minimum tax" means the minimum tax imposed by this section.

(d) "Regular tax" means the tax that would be imposed under this chapter (without regard
to this section and section 290.032), reduced by the sum of the nonrefundable credits allowed
under this chapter.

(e) "Tentative minimum tax" equals 6.75 percent of alternative minimum taxable income
after subtracting the exemption amount determined under subdivision 3.

new text begin EFFECTIVE DATE. new text end

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

Sec. 13.

Minnesota Statutes 2018, section 290A.03, subdivision 3, is amended to read:

Subd. 3.

Income.

(a) "Income" means the sum of the following:

(1) federal adjusted gross income as defined in the Internal Revenue Code; and

(2) the sum of the following amounts to the extent not included in clause (1):

(i) all nontaxable income;

(ii) the amount of a passive activity loss that is not disallowed as a result of section 469,
paragraph (i) or (m) of the Internal Revenue Code and the amount of passive activity loss
carryover allowed under section 469(b) of the Internal Revenue Code;

(iii) an amount equal to the total of any discharge of qualified farm indebtedness of a
solvent individual excluded from gross income under section 108(g) of the Internal Revenue
Code;

(iv) cash public assistance and relief;

(v) any pension or annuity (including railroad retirement benefits, all payments received
under the federal Social Security Act, Supplemental Security Income, and veterans benefits),
which was not exclusively funded by the claimant or spouse, or which was funded exclusively
by the claimant or spouse and which funding payments were excluded from federal adjusted
gross income in the years when the payments were made;

(vi) interest received from the federal or a state government or any instrumentality or
political subdivision thereof;

(vii) workers' compensation;

(viii) nontaxable strike benefits;

(ix) the gross amounts of payments received in the nature of disability income or sick
pay as a result of accident, sickness, or other disability, whether funded through insurance
or otherwise;

(x) a lump-sum distribution under section 402(e)(3) of the Internal Revenue Code of
1986, as amended through December 31, 1995;

(xi) contributions made by the claimant to an individual retirement account, including
a qualified voluntary employee contribution; simplified employee pension plan;
self-employed retirement plan; cash or deferred arrangement plan under section 401(k) of
the Internal Revenue Code; or deferred compensation plan under section 457 of the Internal
Revenue Code, to the extent the sum of amounts exceeds the retirement base amount for
the claimant and spouse;

(xii) to the extent not included in federal adjusted gross income, distributions received
by the claimant or spouse from a traditional or Roth style retirement account or plan;

(xiii) nontaxable scholarship or fellowship grants;

(xiv) the amount of deduction allowed under section 199 of the Internal Revenue Code;

(xv) the amount of deduction allowed under section 220 or 223 of the Internal Revenue
Code;

(xvi) the amount deducted for tuition expenses under section 222 of the Internal Revenue
Code; and

(xvii) the amount deducted for certain expenses of elementary and secondary school
teachers under section 62(a)(2)(D) of the Internal Revenue Code.

In the case of an individual who files an income tax return on a fiscal year basis, the
term "federal adjusted gross income" shall mean federal adjusted gross income reflected in
the fiscal year ending in the calendar year. Federal adjusted gross income shall not be reduced
by the amount of a net operating loss carryback or carryforward or a capital loss carryback
or carryforward allowed for the year.

(b) "Income" does not include:

(1) amounts excluded pursuant to the Internal Revenue Code, sections 101(a) and 102;

(2) amounts of any pension or annuity which was exclusively funded by the claimant
or spouse and which funding payments were not excluded from federal adjusted gross
income in the years when the payments were made;

(3) to the extent included in federal adjusted gross income, amounts contributed by the
claimant or spouse to a traditional or Roth style retirement account or plan, but not to exceed
the retirement base amount reduced by the amount of contributions excluded from federal
adjusted gross income, but not less than zero;

(4) surplus food or other relief in kind supplied by a governmental agency;

(5) relief granted under this chapter;

(6) child support payments received under a temporary or final decree of dissolution or
legal separation; or

(7) restitution payments received by eligible individuals and excludable interest as
defined in section 803 of the Economic Growth and Tax Relief Reconciliation Act of 2001,
Public Law 107-16.

(c) The sum of the following amounts may be subtracted from income:

(1) for the claimant's first dependent, the exemption amount multiplied by 1.4;

(2) for the claimant's second dependent, the exemption amount multiplied by 1.3;

(3) for the claimant's third dependent, the exemption amount multiplied by 1.2;

(4) for the claimant's fourth dependent, the exemption amount multiplied by 1.1;

(5) for the claimant's fifth dependent, the exemption amount; and

(6) if the claimant or claimant's spouse deleted text begin was disabled deleted text end new text begin had a disability new text end or attained the age
of 65 on or before December 31 of the year for which the taxes were levied or rent paid,
the exemption amount.

(d) For purposes of this subdivision, the "exemption amount" means the exemption
amount under section 151(d) of the Internal Revenue Code for the taxable year for which
the income is reported; "retirement base amount" means the deductible amount for the
taxable year for the claimant and spouse under section 219(b)(5)(A) of the Internal Revenue
Code, adjusted for inflation as provided in section 219(b)(5)(C) of the Internal Revenue
Code, without regard to whether the claimant or spouse claimed a deduction; and "traditional
or Roth style retirement account or plan" means retirement plans under sections 401, 403,
408, 408A, and 457 of the Internal Revenue Code.

new text begin EFFECTIVE DATE. new text end

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

Sec. 14.

Minnesota Statutes 2018, section 290A.03, subdivision 4, is amended to read:

Subd. 4.

Household.

"Household" means a claimant and an individual related to the
claimant as deleted text begin husband or wife deleted text end new text begin the claimant's spouse new text end who are domiciled in the same homestead.

new text begin EFFECTIVE DATE. new text end

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

Sec. 15.

Minnesota Statutes 2018, section 290A.03, subdivision 8, is amended to read:

Subd. 8.

Claimant.

(a) "Claimant" means a person, other than a dependent, as defined
under sections 151 and 152 of the Internal Revenue Code disregarding section 152(b)(3)
of the Internal Revenue Code, who filed a claim authorized by this chapter and who was a
resident of this state as provided in chapter 290 during the calendar year for which the claim
for relief was filed.

(b) In the case of a claim relating to rent constituting property taxes, the claimant shall
have resided in a rented or leased unit on which ad valorem taxes or payments made in lieu
of ad valorem taxes, including payments of special assessments imposed in lieu of ad valorem
taxes, are payable at some time during the calendar year covered by the claim.

(c) "Claimant" shall not include a resident of a nursing home, intermediate care facility,
long-term residential facility, or a facility that accepts housing support payments whose
rent constituting property taxes is paid pursuant to the Supplemental Security Income
program under title XVI of the Social Security Act, the Minnesota supplemental aid program
under sections 256D.35 to 256D.54, the medical assistance program pursuant to title XIX
of the Social Security Act, or the housing support program under chapter 256I.

If only a portion of the rent constituting property taxes is paid by these programs, the
resident shall be a claimant for purposes of this chapter, but the refund calculated pursuant
to section 290A.04 shall be multiplied by a fraction, the numerator of which is income as
defined in subdivision 3, paragraphs (a) and (b), reduced by the total amount of income
from the above sources other than vendor payments under the medical assistance program
and the denominator of which is income as defined in subdivision 3, paragraphs (a) and (b),
plus vendor payments under the medical assistance program, to determine the allowable
refund pursuant to this chapter.

(d) Notwithstanding paragraph (c), if the claimant was a resident of the nursing home,
intermediate care facility, long-term residential facility, or facility for which the rent was
paid for the claimant by the housing support program for only a portion of the calendar year
covered by the claim, the claimant may compute rent constituting property taxes by
disregarding the rent constituting property taxes from the nursing home or facility and use
only that amount of rent constituting property taxes or property taxes payable relating to
that portion of the year when the claimant was not in the facility. The claimant's household
income is the income for the entire calendar year covered by the claim.

(e) In the case of a claim for rent constituting property taxes of a part-year Minnesota
resident, the income and rental reflected in this computation shall be for the period of
Minnesota residency only. Any rental expenses paid which may be reflected in arriving at
federal adjusted gross income cannot be utilized for this computation. When two individuals
of a household are able to meet the qualifications for a claimant, they may determine among
them as to who the claimant shall be. If they are unable to agree, the matter shall be referred
to the commissioner of revenue whose decision shall be final. If a homestead property owner
was a part-year Minnesota resident, the income reflected in the computation made pursuant
to section 290A.04 shall be for the entire calendar year, including income not assignable to
Minnesota.

(f) If a homestead is occupied by two or more renters, who are not deleted text begin husband and wife deleted text end new text begin
married to each other new text end , the rent shall be deemed to be paid equally by each, and separate
claims shall be filed by each. The income of each shall be each renter's household income
for purposes of computing the amount of credit to be allowed.

new text begin EFFECTIVE DATE. new text end

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

Sec. 16.

Minnesota Statutes 2018, section 290A.05, is amended to read:

290A.05 COMBINED HOUSEHOLD INCOME.

If a person occupies a homestead with another person deleted text begin or persons deleted text end not related to the person
as deleted text begin husband and wife deleted text end new text begin the person's spouse new text end , excluding dependents, roomers or boarders on
contract, and has property tax payable with respect to the homestead, the household income
of the claimant or claimants for the purpose of computing the refund allowed by section
290A.04 shall include the total income received by the other persons residing in the
homestead. For purposes of this section, "dependent" includes a parent of the claimant or
spouse who lives in the claimant's homestead and does not have an ownership interest in
the homestead. If a person occupies a homestead with another person or persons not related new text begin
to the person new text end as deleted text begin husband and wife deleted text end new text begin the person's spouse new text end or as dependents, the property tax
payable or rent constituting property tax shall be reduced as follows.

If the other person or persons are residing at the homestead under rental or lease
agreement, the amount of property tax payable or rent constituting property tax shall be that
portion not covered by the rental agreement.

new text begin EFFECTIVE DATE. new text end

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

Sec. 17.

Minnesota Statutes 2018, section 290A.08, is amended to read:

290A.08 ONE CLAIMANT PER HOUSEHOLD.

Only one claimant per household per year is entitled to relief under this chapter. Payment
of the claim for relief may be made payable to the deleted text begin husband and wife deleted text end new text begin spouses new text end as one claimant.
The commissioner, upon written request, may issue separate checks, to the deleted text begin husband and
wife deleted text end new text begin spouses new text end for one-half of the relief provided the original check has not been issued or
has been returned. Individuals related as deleted text begin husband and wife deleted text end new text begin spouses new text end who were married during
the year may elect to file a joint claim which shall include each spouse's income, rent
constituting property taxes, and property taxes payable. deleted text begin Husbands and wives deleted text end new text begin Spouses new text end who
were married for the entire year and were domiciled in the same household for the entire
year must file a joint claim. The maximum dollar amount allowable for a joint claim shall
not exceed the amount that one person could receive.

new text begin EFFECTIVE DATE. new text end

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

Sec. 18.

Minnesota Statutes 2018, section 290A.09, is amended to read:

290A.09 PROOF OF CLAIM.

Every claimant shall supply to the commissioner of revenue, in support of the claim,
proof of eligibility under this chapter, including but not limited to amount of rent paid or
property taxes accrued, name and address of owner or managing agent of property rented,
changes in homestead, household membership, household income, size and nature of property
claimed as a homestead.

deleted text begin Disabled deleted text end Persons new text begin with a disability new text end filing claims shall submit proof of disability in the
form and manner as the commissioner may prescribe. The department may require
examination and certification by the claimant's physician or by a physician designated by
the commissioner. The cost of any examination shall be borne by the claimant, unless the
examination proves the disability, in which case the cost of the examination shall be borne
by the commissioner.

A determination of disability of a claimant by the Social Security Administration under
Title II or Title XVI of the Social Security Act shall constitute presumptive proof of disability.

new text begin EFFECTIVE DATE. new text end

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

Sec. 19.

Minnesota Statutes 2018, section 297A.61, subdivision 18, is amended to read:

Subd. 18.

deleted text begin Disabled deleted text end new text begin Person with a disability new text end .

" deleted text begin Disabled deleted text end new text begin Person with a disability new text end " means
an individual who has a permanent and total disability as defined in section 273.13,
subdivision 22.

new text begin EFFECTIVE DATE. new text end

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

Sec. 20.

Minnesota Statutes 2018, section 297A.67, subdivision 6, is amended to read:

Subd. 6.

Other exempt meals.

(a) Prepared food, candy, and soft drinks purchased for
and served exclusively to individuals who are 60 years of age or over and their spouses or
to deleted text begin disabled deleted text end persons new text begin with a disability new text end and their spouses by governmental agencies, nonprofit
organizations, or churches, or pursuant to any program funded in whole or in part through
United States Code, title 42, sections 3001 through 3045, wherever delivered, prepared, or
served, are exempt. Taxable food sold through vending machines is not exempt.

(b) Prepared food, candy, and soft drinks purchased for and served exclusively to children
who are less than 14 years of age or deleted text begin disabled deleted text end children new text begin with a disability new text end who are less than
16 years of age and who are attending a child care or early childhood education program,
are exempt if they are:

(1) purchased by a nonprofit child care facility that is exempt under section 297A.70,
subdivision 4, and that primarily serves families with income of 250 percent or less of
federal poverty guidelines; and

(2) prepared at the site of the child care facility.

new text begin EFFECTIVE DATE. new text end

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

Sec. 21.

Minnesota Statutes 2018, section 297A.67, subdivision 12, is amended to read:

Subd. 12.

Parts and accessories used to make a motor vehicle deleted text begin disabled deleted text end accessible new text begin
to a person with a disability new text end .

Parts, accessories, and labor charges that are used solely to
modify a motor vehicle to make it deleted text begin disabled deleted text end accessible new text begin to persons with a disability new text end are exempt.

new text begin EFFECTIVE DATE. new text end

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

Sec. 22.

Minnesota Statutes 2018, section 297A.70, subdivision 3, is amended to read:

Subd. 3.

Sales of certain goods and services to government.

(a) The following sales
to or use by the specified governments and political subdivisions of the state are exempt:

(1) repair and replacement parts for emergency rescue vehicles, fire trucks, and fire
apparatus to a political subdivision;

(2) machinery and equipment, except for motor vehicles, used directly for mixed
municipal solid waste management services at a solid waste disposal facility as defined in
section 115A.03, subdivision 10;

(3) chore and homemaking services to a political subdivision of the state to be provided
to elderly new text begin individuals new text end or deleted text begin disabled individuals deleted text end new text begin persons with a disability new text end ;

(4) telephone services to the Office of MN.IT Services that are used to provide
telecommunications services through the MN.IT services revolving fund;

(5) firefighter personal protective equipment as defined in paragraph (b), if purchased
or authorized by and for the use of an organized fire department, fire protection district, or
fire company regularly charged with the responsibility of providing fire protection to the
state or a political subdivision;

(6) bullet-resistant body armor that provides the wearer with ballistic and trauma
protection, if purchased by a law enforcement agency of the state or a political subdivision
of the state, or a licensed peace officer, as defined in section 626.84, subdivision 1;

(7) motor vehicles purchased or leased by political subdivisions of the state if the vehicles
are exempt from registration under section 168.012, subdivision 1, paragraph (b), exempt
from taxation under section 473.448, or exempt from the motor vehicle sales tax under
section 297B.03, clause (12);

(8) equipment designed to process, dewater, and recycle biosolids for wastewater
treatment facilities of political subdivisions, and materials incidental to installation of that
equipment;

(9) the removal of trees, bushes, or shrubs for the construction and maintenance of roads,
trails, or firebreaks when purchased by an agency of the state or a political subdivision of
the state;

(10) purchases by the Metropolitan Council or the Department of Transportation of
vehicles and repair parts to equip operations provided for in section 174.90, including, but
not limited to, the Northstar Corridor Rail project; and

(11) purchases of water used directly in providing public safety services by an organized
fire department, fire protection district, or fire company regularly charged with the
responsibility of providing fire protection to the state or a political subdivision.

(b) For purposes of this subdivision, "firefighters personal protective equipment" means
helmets, including face shields, chin straps, and neck liners; bunker coats and pants, including
pant suspenders; boots; gloves; head covers or hoods; wildfire jackets; protective coveralls;
goggles; self-contained breathing apparatus; canister filter masks; personal alert safety
systems; spanner belts; optical or thermal imaging search devices; and all safety equipment
required by the Occupational Safety and Health Administration.

(c) For purchases of items listed in paragraph (a), clause (10), the tax must be imposed
and collected as if the rate under section 297A.62, subdivision 1, applied and then refunded
in the manner provided in section 297A.75.

new text begin EFFECTIVE DATE. new text end

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

Sec. 23.

Minnesota Statutes 2018, section 297A.70, subdivision 4, is amended to read:

Subd. 4.

Sales to nonprofit groups.

(a) All sales, except those listed in paragraph (b),
to the following "nonprofit organizations" are exempt:

(1) a corporation, society, association, foundation, or institution organized and operated
exclusively for charitable, religious, or educational purposes if the item purchased is used
in the performance of charitable, religious, or educational functions;

(2) any senior citizen group or association of groups that:

(i) in general limits membership to persons who are either age 55 or older, or deleted text begin physically
disabled deleted text end new text begin persons with a physical disability new text end ;

(ii) is organized and operated exclusively for pleasure, recreation, and other nonprofit
purposes, not including housing, no part of the net earnings of which inures to the benefit
of any private shareholders; and

(iii) is an exempt organization under section 501(c) of the Internal Revenue Code; and

(3) an organization that qualifies for an exemption for memberships under subdivision
12 if the item is purchased and used in the performance of the organization's mission.

For purposes of this subdivision, charitable purpose includes the maintenance of a cemetery
owned by a religious organization.

(b) This exemption does not apply to the following sales:

(1) building, construction, or reconstruction materials purchased by a contractor or a
subcontractor as a part of a lump-sum contract or similar type of contract with a guaranteed
maximum price covering both labor and materials for use in the construction, alteration, or
repair of a building or facility;

(2) construction materials purchased by tax-exempt entities or their contractors to be
used in constructing buildings or facilities that will not be used principally by the tax-exempt
entities;

(3) lodging as defined under section 297A.61, subdivision 3, paragraph (g), clause (2),
and prepared food, candy, soft drinks, and alcoholic beverages as defined in section 297A.67,
subdivision 2, except wine purchased by an established religious organization for sacramental
purposes or as allowed under subdivision 9a; and

(4) leasing of a motor vehicle as defined in section 297B.01, subdivision 11, except as
provided in paragraph (c).

(c) This exemption applies to the leasing of a motor vehicle as defined in section 297B.01,
subdivision 11, only if the vehicle is:

(1) a truck, as defined in section 168.002, a bus, as defined in section 168.002, or a
passenger automobile, as defined in section 168.002, if the automobile is designed and used
for carrying more than nine persons including the driver; and

(2) intended to be used primarily to transport tangible personal property or individuals,
other than employees, to whom the organization provides service in performing its charitable,
religious, or educational purpose.

(d) A limited liability company also qualifies for exemption under this subdivision if
(1) it consists of a sole member that would qualify for the exemption, and (2) the items
purchased qualify for the exemption.

new text begin EFFECTIVE DATE. new text end

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

Sec. 24.

Minnesota Statutes 2018, section 297A.70, subdivision 16, is amended to read:

Subd. 16.

Camp fees.

Fees to camps or other recreation facilities are exempt for:

(1) services primarily for children, adults accompanying children, or persons with
deleted text begin disabilities deleted text end new text begin a disability new text end ; or

(2) educational or religious activities;

deleted text begin and deleted text end new text begin if new text end the camp or facilities are owned and operated by an exempt organization under section
501(c)(3) of the Internal Revenue Code.

new text begin EFFECTIVE DATE. new text end

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

Sec. 25.

Minnesota Statutes 2018, section 297A.71, subdivision 22, is amended to read:

Subd. 22.

Materials used to make residential property deleted text begin disabled deleted text end accessible new text begin to persons
with a disability new text end .

Building materials and equipment sold to, or stored, used, or consumed
by, a nonprofit organization are exempt if:

(1) the materials and equipment are used or incorporated into modifying an existing
residential structure to make it deleted text begin disabled deleted text end accessible new text begin to persons with a disability new text end ; and

(2) the materials and equipment used in the modification would qualify for an exemption
under either subdivision 11 or 12 if made by the current owner of the residence.

For purposes of this subdivision, "nonprofit organization" means any nonprofit
corporation, society, association, foundation, or institution organized and operated exclusively
for charitable, religious, educational, or civic purposes; or a veterans' group exempt from
federal taxation under section 501(c), clause (19), of the Internal Revenue Code.

new text begin EFFECTIVE DATE. new text end

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

Sec. 26.

Minnesota Statutes 2018, section 297A.75, subdivision 1, is amended to read:

Subdivision 1.

Tax collected.

The tax on the gross receipts from the sale of the following
exempt items must be imposed and collected as if the sale were taxable and the rate under
section 297A.62, subdivision 1, applied. The exempt items include:

(1) building materials for an agricultural processing facility exempt under section
297A.71, subdivision 13;

(2) building materials for mineral production facilities exempt under section 297A.71,
subdivision 14;

(3) building materials for correctional facilities under section 297A.71, subdivision 3;

(4) building materials used in a residence for deleted text begin disabled deleted text end veterans new text begin with a disability new text end exempt
under section 297A.71, subdivision 11;

(5) elevators and building materials exempt under section 297A.71, subdivision 12;

(6) materials and supplies for qualified low-income housing under section 297A.71,
subdivision 23;

(7) materials, supplies, and equipment for municipal electric utility facilities under
section 297A.71, subdivision 35;

(8) equipment and materials used for the generation, transmission, and distribution of
electrical energy and an aerial camera package exempt under section 297A.68, subdivision
37;

(9) commuter rail vehicle and repair parts under section 297A.70, subdivision 3, paragraph
(a), clause (10);

(10) materials, supplies, and equipment for construction or improvement of projects and
facilities under section 297A.71, subdivision 40;

(11) materials, supplies, and equipment for construction, improvement, or expansion
of:

(i) an aerospace defense manufacturing facility exempt under Minnesota Statutes 2014,
section 297A.71, subdivision 42;

(ii) a biopharmaceutical manufacturing facility exempt under section 297A.71, subdivision
45;

(iii) a research and development facility exempt under Minnesota Statutes 2014, section
297A.71, subdivision 46; and

(iv) an industrial measurement manufacturing and controls facility exempt under
Minnesota Statutes 2014, section 297A.71, subdivision 47;

(12) enterprise information technology equipment and computer software for use in a
qualified data center exempt under section 297A.68, subdivision 42;

(13) materials, supplies, and equipment for qualifying capital projects under section
297A.71, subdivision 44, paragraph (a), clause (1), and paragraph (b);

(14) items purchased for use in providing critical access dental services exempt under
section 297A.70, subdivision 7, paragraph (c);

(15) items and services purchased under a business subsidy agreement for use or
consumption primarily in greater Minnesota exempt under section 297A.68, subdivision
44;

(16) building materials, equipment, and supplies for constructing or replacing real
property exempt under section 297A.71, subdivision 49; and

(17) building materials, equipment, and supplies for constructing or replacing real
property exempt under section 297A.71, subdivision 50, paragraph (b).

new text begin EFFECTIVE DATE. new text end

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

Sec. 27.

Minnesota Statutes 2018, section 297B.01, subdivision 14, is amended to read:

Subd. 14.

Purchase price.

(a) "Purchase price" means the total consideration valued in
money for a sale, whether paid in money or otherwise. The purchase price excludes the
amount of a manufacturer's rebate paid or payable to the purchaser. If a motor vehicle is
taken in trade as a credit or as part payment on a motor vehicle taxable under this chapter,
the credit or trade-in value allowed by the person selling the motor vehicle shall be deducted
from the total selling price to establish the purchase price of the vehicle being sold and the
trade-in allowance allowed by the seller shall constitute the purchase price of the motor
vehicle accepted as a trade-in. The purchase price in those instances where the motor vehicle
is acquired by gift or by any other transfer for a nominal or no monetary consideration shall
also include the average value of similar motor vehicles, established by standards and guides
as determined by the motor vehicle registrar. The purchase price in those instances where
a motor vehicle is manufactured by a person who registers it under the laws of this state
shall mean the manufactured cost of such motor vehicle and manufactured cost shall mean
the amount expended for materials, labor, and other properly allocable costs of manufacture,
except that in the absence of actual expenditures for the manufacture of a part or all of the
motor vehicle, manufactured costs shall mean the reasonable value of the completed motor
vehicle.

(b) The term "purchase price" shall not include the portion of the value of a motor vehicle
due solely to modifications necessary to make the motor vehicle deleted text begin disability deleted text end accessible new text begin to
persons with a disability new text end .

(c) The term "purchase price" shall not include the transfer of a motor vehicle by way
of gift between deleted text begin a husband and wife deleted text end new text begin spouses new text end or parent and child, or to a nonprofit organization
as provided under subdivision 16, paragraph (c), clause (6), nor shall it include the transfer
of a motor vehicle by a guardian to a ward when there is no monetary consideration and the
title to such vehicle was registered in the name of the guardian, as guardian, only because
the ward was a minor.

(d) The term "purchase price" shall not include the transfer of a motor vehicle as a gift
between a foster parent and foster child. For purposes of this subdivision, a foster relationship
exists, regardless of the age of the child, if (1) a foster parent's home is or was licensed as
a foster family home under Minnesota Rules, parts 2960.3000 to 2960.3340, and (2) the
county verifies that the child was a state ward or in permanent foster care.

(e) There shall not be included in "purchase price" the amount of any tax imposed by
the United States upon or with respect to retail sales whether imposed upon the retailer or
the consumer.

new text begin EFFECTIVE DATE. new text end

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

Sec. 28.

Minnesota Statutes 2018, section 297B.01, subdivision 16, is amended to read:

Subd. 16.

Sale, sells, selling, purchase, purchased, or acquired.

(a) "Sale," "sells,"
"selling," "purchase," "purchased," or "acquired" means any transfer of title of any motor
vehicle, whether absolutely or conditionally, for a consideration in money or by exchange
or barter for any purpose other than resale in the regular course of business.

(b) Any motor vehicle utilized by the owner only by leasing such vehicle to others or
by holding it in an effort to so lease it, and which is put to no other use by the owner other
than resale after such lease or effort to lease, shall be considered property purchased for
resale.

(c) The terms also shall include any transfer of title or ownership of a motor vehicle by
other means, for or without consideration, except that these terms shall not include:

(1) the acquisition of a motor vehicle by inheritance from or by bequest of, or
transfer-on-death of title by, a decedent who owned it;

(2) the transfer of a motor vehicle which was previously licensed in the names of two
or more joint tenants and subsequently transferred without monetary consideration to one
or more of the joint tenants;

(3) the transfer of a motor vehicle by way of gift from a limited used vehicle dealer
licensed under section 168.27, subdivision 4a, to an individual, when the transfer is with
no monetary or other consideration or expectation of consideration and the parties to the
transfer submit an affidavit to that effect at the time the title transfer is recorded;

(4) the transfer of a motor vehicle by gift between:

(i) spouses;

(ii) parents and a child; or

(iii) grandparents and a grandchild;

(5) the voluntary or involuntary transfer of a motor vehicle between deleted text begin a husband and wife deleted text end new text begin
spouses new text end in a divorce proceeding; or

(6) the transfer of a motor vehicle by way of a gift to an organization that is exempt from
federal income taxation under section 501(c)(3) of the Internal Revenue Code when the
motor vehicle will be used exclusively for religious, charitable, or educational purposes.

new text begin EFFECTIVE DATE. new text end

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

Sec. 29.

Minnesota Statutes 2018, section 298.018, subdivision 1, is amended to read:

Subdivision 1.

Within taconite assistance area.

The proceeds of the tax paid under
sections 298.015 and 298.016 on ores, metals, or minerals mined or extracted within the
taconite assistance area defined in section 273.1341, shall be allocated as follows:

(1) five percent to the city or town within which the minerals or energy resources are
mined or extracted, or within which the concentrate was produced. If the mining and
concentration, or different steps in either process, are carried on in more than one taxing
district, the commissioner shall apportion equitably the proceeds among the cities and towns
by attributing 50 percent of the proceeds of the tax to the operation of mining or extraction,
and the remainder to the concentrating plant and to the processes of concentration, and with
respect to each thereof giving due consideration to the relative extent of the respective
operations performed in each taxing district;

(2) ten percent to the taconite municipal aid account to be distributed as provided in
section 298.282 new text begin , subdivisions 1 and 2, on the dates provided under this section new text end ;

(3) ten percent to the school district within which the minerals or energy resources are
mined or extracted, or within which the concentrate was produced. If the mining and
concentration, or different steps in either process, are carried on in more than one school
district, distribution among the school districts must be based on the apportionment formula
prescribed in clause (1);

(4) 20 percent to a group of school districts comprised of those school districts wherein
the mineral or energy resource was mined or extracted or in which there is a qualifying
municipality as defined by section 273.134, paragraph (b), in direct proportion to school
district indexes as follows: for each school district, its pupil units determined under section
126C.05 for the prior school year shall be multiplied by the ratio of the average adjusted
net tax capacity per pupil unit for school districts receiving aid under this clause as calculated
pursuant to chapters 122A, 126C, and 127A for the school year ending prior to distribution
to the adjusted net tax capacity per pupil unit of the district. Each district shall receive that
portion of the distribution which its index bears to the sum of the indices for all school
districts that receive the distributions;

(5) 20 percent to the county within which the minerals or energy resources are mined
or extracted, or within which the concentrate was produced. If the mining and concentration,
or different steps in either process, are carried on in more than one county, distribution
among the counties must be based on the apportionment formula prescribed in clause (1),
provided that any county receiving distributions under this clause shall pay one percent of
its proceeds to the Range Association of Municipalities and Schools;

(6) 20 percent to St. Louis County acting as the counties' fiscal agent to be distributed
as provided in sections 273.134 to 273.136;

(7) five percent to the commissioner of Iron Range resources and rehabilitation for the
purposes of section 298.22;

(8) three percent to the Douglas J. Johnson economic protection trust fund; and

(9) seven percent to the taconite environmental protection fund.

deleted text begin The proceeds of the tax shall be distributed on July 15 each year.
deleted text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 30.

Minnesota Statutes 2018, section 298.018, is amended by adding a subdivision
to read:

new text begin Subd. 1a. new text end

new text begin Distribution date. new text end

new text begin The proceeds of the tax allocated under subdivision 1 shall
be distributed on December 15 each year. Any payment of proceeds received after December
15 shall be distributed on the next net proceeds tax distribution date.
new text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 31.

Minnesota Statutes 2018, section 298.282, subdivision 1, is amended to read:

Subdivision 1.

Distribution of taconite municipal aid account.

new text begin (a) new text end The amount
deposited with the county as provided in section 298.28, subdivision 3, must be distributed
as provided by this section among: (1) the municipalities comprising a taconite assistance
area under section 273.1341; (2) a township that contains a state park consisting primarily
of an underground iron ore mine; and (3) a city located within five miles of that state park,
each being referred to in this section as a qualifying municipality.

new text begin (b) The amount deposited in the state general fund as provided in section 298.018,
subdivision 1, must be distributed in the same manner as provided under paragraph (a)
except that subdivisions 3, 4, and 5 do not apply, and the distributions shall be made on the
dates provided under section 298.018, subdivision 1a.
new text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 32.

Laws 2017, First Special Session chapter 1, article 8, section 3, the effective date,
is amended to read:

EFFECTIVE DATE.

This section is effective for new text begin (1) new text end petitions and appeals filed after
June 30, 2017 new text begin , for which notices of entry of order are mailed before July 1, 2019, and (2)
notices of entry of order mailed after June 30, 2019 new text end .

new text begin EFFECTIVE DATE. new text end

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

APPENDIX

Repealed Minnesota Statutes: S2555-1

69.011 QUALIFYING FOR STATE AID.

Subdivision 1.

Definitions.

Unless the language or context clearly indicates that a different meaning is intended, the following words and terms, for the purposes of this chapter and chapters 423, 423A, 424 and 424A, have the meanings ascribed to them:

(a) "Commissioner" means the commissioner of revenue.

(b) "Municipality" means:

(1) a home rule charter or statutory city;

(2) an organized town;

(3) a park district subject to chapter 398;

(4) the University of Minnesota;

(5) for purposes of the fire state aid program only, an American Indian tribal government entity located within a federally recognized American Indian reservation;

(6) for purposes of the police state aid program only, an American Indian tribal government with a tribal police department which exercises state arrest powers under section 626.90, 626.91, 626.92, or 626.93;

(7) for purposes of the police state aid program only, the Metropolitan Airports Commission; and

(8) for purposes of the police state aid program only, the Department of Natural Resources and the Department of Public Safety with respect to peace officers covered under chapter 352B.

(c) "Minnesota Firetown Premium Report" means a form prescribed by the commissioner containing space for reporting by insurers of fire, lightning, sprinkler leakage and extended coverage premiums received upon risks located or to be performed in this state less return premiums and dividends.

(d) "Firetown" means the area serviced by any municipality having a qualified fire department or a qualified incorporated fire department having a subsidiary volunteer firefighters' relief association.

(e) "Estimated market value" means latest available estimated market value of all property in a taxing jurisdiction, whether the property is subject to taxation, or exempt from ad valorem taxation obtained from information which appears on abstracts filed with the commissioner of revenue or equalized by the State Board of Equalization.

(f) "Minnesota Aid to Police Premium Report" means a form prescribed by the commissioner for reporting by each fire and casualty insurer of all premiums received upon direct business received by it in this state, or by its agents for it, in cash or otherwise, during the preceding calendar year, with reference to insurance written for insuring against the perils contained in auto insurance coverages as reported in the Minnesota business schedule of the annual financial statement which each insurer is required to file with the commissioner in accordance with the governing laws or rules less return premiums and dividends.

(g) "Peace officer" means any person:

(1) whose primary source of income derived from wages is from direct employment by a municipality or county as a law enforcement officer on a full-time basis of not less than 30 hours per week;

(2) who has been employed for a minimum of six months prior to December 31 preceding the date of the current year's certification under subdivision 2, paragraph (b);

(3) who is sworn to enforce the general criminal laws of the state and local ordinances;

(4) who is licensed by the Peace Officers Standards and Training Board and is authorized to arrest with a warrant; and

(5) who is a member of the State Patrol retirement plan or the public employees police and fire fund.

(h) "Full-time equivalent number of peace officers providing contract service" means the integral or fractional number of peace officers which would be necessary to provide the contract service if all peace officers providing service were employed on a full-time basis as defined by the employing unit and the municipality receiving the contract service.

(i) "Retirement benefits other than a service pension" means any disbursement authorized under section 424A.05, subdivision 3, clauses (3) and (4).

(j) "Municipal clerk, municipal clerk-treasurer, or county auditor" means:

(1) for the police state aid program:

(i) the person who was elected or appointed to the specified position or, in the absence of the person, another person who is designated by the applicable governing body;

(ii) in a park district, the secretary of the board of park district commissioners;

(iii) in the case of the University of Minnesota, the official designated by the Board of Regents;

(iv) for the Metropolitan Airports Commission, the person designated by the commission;

(v) for the Department of Natural Resources or the Department of Public Safety, the respective commissioner;

(vi) for a tribal police department which exercises state arrest powers under section 626.90, 626.91, 626.92, or 626.93, the person designated by the applicable American Indian tribal government; and

(2) for the fire state aid program and fire relief association financial reports, the person who was elected or appointed to the specified position, or, for governmental entities other than counties, if the governing body of the governmental entity designates the position to perform the function, the chief financial official of the governmental entity or the chief administrative official of the governmental entity.

(k) "Voluntary statewide lump-sum volunteer firefighter retirement plan" means the retirement plan established by chapter 353G.

Subd. 2.

Qualification for fire or police state aid.

(a) Unless retirement coverage is provided by the voluntary statewide lump-sum volunteer firefighter retirement plan, in order to qualify to receive fire state aid, on or before March 15 annually, in conjunction with the financial report required pursuant to section 69.051, the clerk of each municipality having a duly organized fire department as provided in subdivision 4, or the secretary of each independent nonprofit firefighting corporation having a subsidiary incorporated firefighters' relief association, whichever is applicable, and the fire chief, shall jointly certify the existence of the municipal fire department or of the independent nonprofit firefighting corporation, whichever is applicable, which meets the minimum qualification requirements set forth in this subdivision, and the fire personnel and equipment of the municipal fire department or the independent nonprofit firefighting corporation as of the preceding December 31.

(b) Where retirement coverage is provided by the voluntary statewide lump-sum volunteer firefighter retirement plan, in order to qualify to receive fire state aid, on or before March 15, annually, the executive director of the Public Employees Retirement Association shall certify the existence of that coverage for each municipality and the municipal clerk or independent nonprofit firefighting corporation secretary, whichever applies, and the applicable fire chief shall certify the fire personnel and fire department equipment as of the preceding December 31.

(c) Except as provided in subdivision 2b, on or before March 15 annually, in order to qualify to receive police state aid, the clerk of each municipality and the auditor of each county employing one or more peace officers as defined in subdivision 1, paragraph (g), shall certify the number of such peace officers to the commissioner on forms prescribed by the commissioner. Credit for officers employed less than a full year must be apportioned. Each full month of employment of a qualifying officer during the calendar year entitles the employing municipality or county to credit for 1/12 of the payment for employment of a peace officer for the entire year. For purposes of sections 69.011 to 69.051, employment of a peace officer commences when the peace officer is entered on the payroll of the respective municipal police department or county sheriff's department. No peace officer may be included in the certification of the number of peace officers by more than one employing unit for the same month.

(d) A certification made under this subdivision must be filed with the commissioner, must be made on a form prescribed by the commissioner, and must include any other facts that the commissioner requires.

Subd. 2b.

Departments of Natural Resources and Public Safety.

(a) On or before each March 15, the commissioner of natural resources shall certify the number of peace officers as defined in subdivision 1, clause (g), employed by the Enforcement Division and the commissioner of public safety shall certify the number of peace officers as defined in subdivision 1, clause (g), employed by the Bureau of Criminal Apprehension, the Gambling Enforcement Division, and the State Patrol Division.

(b) The certification must be on a form prescribed by the commissioner. Peace officers certified under this paragraph must be included in the total certifications under subdivision 2.

Subd. 2c.

Ineligibility of certain police officers.

A police officer employed by the University of Minnesota who is required by the Board of Regents to be a member of the University of Minnesota faculty retirement plan is not eligible to be included in any police state-aid certification under this section.

Subd. 3.

Failure to file certificate deemed waiver.

(a) If a certification required by this section is not filed with the commissioner by the due date prescribed by this section, the commissioner shall notify the county, the municipality, or the nonprofit firefighting corporation that a portion or all of its current year aid will be forfeited if the certification is not received within ten days.

(b) The amount of aid forfeited is equal to the amount of state police aid or state fire aid determined for the county, the municipality, or the nonprofit firefighting corporation for the current year, multiplied by five percent for each week or fraction of a week that this certification is late. The penalty must be computed beginning ten days after the postmark date of the commissioner's notification as required under this subdivision. All forfeited aid amounts revert to the general fund in the state treasury. Failure to receive the certificate form may not be used as a defense for a failure to file.

Subd. 4.

Qualification for fire state aid.

(a) A municipality in this state qualifies to receive fire state aid if it meets the general requirements of paragraph (b) and if it meets the specific requirements of paragraph (c).

(b) Minimum qualifications for fire state aid include the following:

(1) having for more than one year an organized fire department and officially established by the governing body of the municipality or an independent nonprofit firefighting corporation created under the nonprofit corporation act of this state and operating exclusively for firefighting purposes and providing retirement and relief benefits to its members; and

(2) having a separate subsidiary incorporated firefighter's relief association providing retirement and relief benefits, or participating in the voluntary statewide lump-sum volunteer firefighter retirement plan or, if a paid fire department, having retirement coverage by the public employees police and fire retirement plan.

(c) Minimum requirements for fire state aid also include the following or their equivalent as determined by the state fire marshal:

(1) having ten paid or volunteer firefighters including a fire chief and assistant fire chief;

(2) having regular scheduled meetings and frequent drills including instructions in firefighting tactics and in the use, care, and operation of all fire apparatus and equipment;

(3) having a motorized fire truck equipped with a motorized pump, 250 gallon or larger water tank, 300 feet of one inch or larger fire hose in two lines with combination spray and straight stream nozzles, five-gallon hand pumps--tank extinguisher or equivalent, dry chemical extinguisher or equivalent, ladders, extension ladders, pike poles, crow bars, axes, lanterns, fire coats, helmets, and boots;

(4) having apparatus suitably housed in a building of good construction with facilities for care of hose and equipment;

(5) having a reliable and adequate method of receiving fire alarms by telephone or with electric siren and suitable means of sounding an alarm;

(6) if response is to be provided outside the corporate limits of the municipality wherein the fire department is located, having another piece of motorized apparatus to make the response; and

(7) meeting other requirements that the commissioner establishes by rule.

69.021 REPORTING PREMIUMS; CALCULATION OF AID.

Subdivision 1.

Minnesota Firetown Premium Report and Minnesota Aid to Police Premium Report.

The commissioner shall, at the time of mailing tax forms, send blank copies of the Minnesota Firetown Premium Report and when applicable the Minnesota Aid to Police Premium Report to each insurer, including township and farmers mutual insurance companies licensed to write insurance as described in section 69.011, subdivision 1, clauses (c) and (f) in this state. These reports must contain space for the insurers name, address, gross premiums less return premiums, dividends, net premiums, certification and other facts that the commissioner may require.

Subd. 2.

Report of premiums.

(a) Each insurer, including township and farmers mutual insurers where applicable, shall return to the commissioner the reports described in subdivision 1 certified by its secretary and president or chief financial officer.

(b) The Minnesota Firetown Premium Report must contain a true and accurate statement of the total premium for all gross direct fire, lightning, sprinkler leakage, and extended coverage insurance of all domestic mutual insurers and the total premiums for all gross direct fire, lightning, sprinkler leakage and extended coverage insurance of all other insurers, less return premiums and dividends received by them on that business written or done during the preceding calendar year upon property located within the state or brought into the state for temporary use. The fire and extended coverage portion of multiperil and multiple peril package premiums and all other combination premiums must be determined by applying percentages determined by the commissioner or by rating bureaus recognized by the commissioner.

(c) The Minnesota Aid to Police Premium Report must contain a true and accurate statement of the total premiums, less return premiums and dividends, on all direct business received by such insurer in this state, or by its agents for it, in cash or otherwise, during the preceding calendar year, with reference to insurance written for perils described in section 69.011, subdivision 1, clause (f).

Subd. 3.

Penalty for fraudulent, incorrect, incomplete returns and late filing of report.

(a) When it appears to the commissioner that any insurer has made an incomplete or inaccurate report, the commissioner shall return the report and demand that a complete and accurate report be filed. If the insurer fails to file a report on or before March 1, annually, the insurer is liable and shall pay $25 for each seven days, or fraction thereof, that the report is delinquent, but not to exceed $200. If the insurer fails to file a corrected report within 30 days after demand, the insurer is liable for the penalties provided in paragraph (b) or (c) for knowingly filing an inaccurate or false report.

(b) Any insurer which knowingly makes and files an inaccurate or false report is liable to a fine in an amount of not less than $25 nor more than $1,000, as determined by the commissioner, and additionally the commissioner of commerce may revoke the insurer's certificate of authority.

(c) Any person whose duty it is to make the report who fails or refuses to make it within 30 days after notification by the commissioner shall be fined an amount of not more than $1,000.

(d) Failure of the insurer to receive a reporting form does not excuse the insurer from filing the report.

Subd. 4.

Determination of qualified state aid recipients; certification to commissioner of management and budget.

(a) The commissioner shall determine which municipalities and independent nonprofit firefighting corporations are qualified to receive fire state aid directly or are qualified to receive the benefit of fire state aid paid to the voluntary statewide lump-sum volunteer firefighter retirement plan and which municipalities and counties are qualified to receive police state aid.

(b) The commissioner shall determine qualification for state aid upon receipt of:

(1) the fire department personnel and equipment certification or the police department and qualified peace officers certificate, whichever applies, required under section 69.011;

(2) the financial compliance report required under section 6.495, subdivision 3, if applicable; and

(3) any other relevant information which comes to the attention of the commissioner.

(c) Upon completion of the determination, on or before October 1, the commissioner shall calculate the amount of:

(1) the police state aid which each county or municipality is to receive under subdivisions 5, 6, 7a, and 10; and

(2) the fire state aid which each municipality or nonprofit firefighting corporation is to receive under subdivisions 5 and 7.

(d) The commissioner shall certify to the commissioner of management and budget the name of each county or municipality, and the amount of state aid which each county or municipality is to receive, in the case of police state aid. The commissioner shall certify to the commissioner of management and budget the name of each municipality or independent nonprofit firefighting corporation and the amount of state aid which each municipality or independent nonprofit firefighting corporation is to receive directly or the amount of state aid which the voluntary statewide lump-sum volunteer firefighter retirement plan is qualified to receive on behalf of the municipality or corporation, in the case of fire state aid.

Subd. 5.

Calculation of state aid.

(a) The amount of fire state aid available for apportionment, before the addition of the minimum fire state aid allocation amount under subdivision 7, is equal to 107 percent of the amount of premium taxes paid to the state upon the fire, lightning, sprinkler leakage, and extended coverage premiums reported to the commissioner by insurers on the Minnesota Firetown Premium Report. This amount must be reduced by the amount required to pay the state auditor's costs and expenses of the audits or exams of the firefighters relief associations.

The total amount for apportionment in respect to fire state aid must not be less than two percent of the premiums reported to the commissioner by insurers on the Minnesota Firetown Premium Report after subtracting the following amounts:

(1) the amount required to pay the state auditor's costs and expenses of the audits or exams of the firefighters relief associations; and

(2) one percent of the premiums reported by township mutual insurance companies and mutual property and casualty companies with total assets of $5,000,000 or less.

(b) The total amount for apportionment as police state aid is equal to 104 percent of the amount of premium taxes paid to the state on the premiums reported to the commissioner by insurers on the Minnesota Aid to Police Premium Report. The total amount for apportionment in respect to the police state aid program must not be less than two percent of the amount of premiums reported to the commissioner by insurers on the Minnesota Aid to Police Premium Report.

(c) The commissioner shall calculate the percentage of increase or decrease reflected in the apportionment over or under the previous year's available state aid using the same premiums as a basis for comparison.

(d) In addition to the amount for apportionment of police state aid under paragraph (b), each year $100,000 must be apportioned for police state aid. An amount sufficient to pay this increase is annually appropriated from the general fund.

Subd. 7.

Apportionment of fire state aid to municipalities and relief associations.

(a) The commissioner shall apportion the fire state aid relative to the premiums reported on the Minnesota Firetown Premium Reports filed under this chapter to each municipality and/or firefighters relief association qualified under section 69.011, subdivision 4.

(b) The commissioner shall calculate an initial fire state aid allocation amount for each municipality or fire department under paragraph (c) and, if applicable, a minimum fire state aid allocation amount for each municipality or fire department under paragraph (d). The municipality or fire department must be apportioned the larger fire state aid amount.

(c) The initial fire state aid allocation amount is the amount available for apportionment as fire state aid under subdivision 5, without the inclusion of any additional funding amount to support a minimum fire state aid amount under section 423A.02, subdivision 3, allocated one-half in proportion to the population as shown in the last official statewide federal census for each fire town and one-half in proportion to the estimated market value of each fire town, including (1) the estimated market value of tax-exempt property and (2) the estimated market value of natural resources lands receiving in lieu payments under sections 477A.11 to 477A.14, but excluding the estimated market value of minerals. In the case of incorporated or municipal fire departments furnishing fire protection to other cities, towns, or townships as evidenced by valid fire service contracts filed with the commissioner, the distribution must be adjusted proportionately to take into consideration the crossover fire protection service. Necessary adjustments must be made to subsequent apportionments. In the case of municipalities or independent fire departments qualifying for the aid, the commissioner shall calculate the state aid for the municipality or relief association on the basis of the population and the estimated market value of the area furnished fire protection service by the fire department as evidenced by duly executed and valid fire service agreements filed with the commissioner. If one or more fire departments are furnishing contracted fire service to a city, town, or township, only the population and estimated market value of the area served by each fire department may be considered in calculating the state aid and the fire departments furnishing service shall enter into an agreement apportioning among themselves the percent of the population and the percent of the estimated market value of each shared service area. The agreement must be in writing and must be filed with the commissioner.

(d) The minimum fire state aid allocation amount is the amount in addition to the initial fire state allocation amount that is derived from any additional funding amount to support a minimum fire state aid amount under section 423A.02, subdivision 3, and allocated to municipalities with volunteer firefighters relief associations or covered by the voluntary statewide lump-sum volunteer firefighter retirement plan based on the number of active volunteer firefighters who are members of the relief association as reported in the annual financial reporting for the calendar year 1993 to the Office of the State Auditor, but not to exceed 30 active volunteer firefighters, so that all municipalities or fire departments with volunteer firefighters relief associations receive in total at least a minimum fire state aid amount per 1993 active volunteer firefighter to a maximum of 30 firefighters. If a relief association is established after calendar year 1993 and before calendar year 2000, the number of active volunteer firefighters who are members of the relief association as reported in the annual financial reporting for calendar year 1998 to the Office of the State Auditor, but not to exceed 30 active volunteer firefighters, shall be used in this determination. If a relief association is established after calendar year 1999, the number of active volunteer firefighters who are members of the relief association as reported in the first annual financial reporting submitted to the Office of the State Auditor, but not to exceed 20 active volunteer firefighters, must be used in this determination. If a relief association is terminated as a result of providing retirement coverage for volunteer firefighters by the voluntary statewide lump-sum volunteer firefighter retirement plan under chapter 353G, the number of active volunteer firefighters of the municipality covered by the statewide plan as certified by the executive director of the Public Employees Retirement Association to the commissioner and the state auditor, but not to exceed 30 active firefighters, must be used in this determination.

(e) Unless the firefighters of the applicable fire department are members of the voluntary statewide lump-sum volunteer firefighter retirement plan, the fire state aid must be paid to the treasurer of the municipality where the fire department is located and the treasurer of the municipality shall, within 30 days of receipt of the fire state aid, transmit the aid to the relief association if the relief association has filed a financial report with the treasurer of the municipality and has met all other statutory provisions pertaining to the aid apportionment. If the firefighters of the applicable fire department are members of the voluntary statewide lump-sum volunteer firefighter retirement plan, the fire state aid must be paid to the executive director of the Public Employees Retirement Association and deposited in the voluntary statewide lump-sum volunteer firefighter retirement fund.

(f) The commissioner may make rules to permit the administration of the provisions of this section.

(g) Any adjustments needed to correct prior misallocations must be made to subsequent fire state aid apportionments.

Subd. 7a.

Apportionment of police state aid.

(a) Subject to the reduction provided for under subdivision 10, the commissioner shall apportion the police state aid to each municipality, to each county, and to the Departments of Natural Resources and Public Safety in the following manner:

(1) for all municipalities maintaining police departments, counties, the Department of Natural Resources, and the Department of Public Safety, the police state aid must be distributed in proportion to the relationship that the total number of peace officers, as determined under section 69.011, subdivision 1, paragraph (g), and subdivision 2, paragraph (b), employed by that employing unit for 12 calendar months and the proportional or fractional number who were employed less than 12 months bears to the total number of peace officers employed by all municipalities, counties, the Departments of Natural Resources and Public Safety, subject to any reduction under subdivision 10;

(2) for each municipality which contracts with the county for police service, a proportionate amount of the state aid distributed to the county based on the full-time equivalent number of peace officers providing contract service to that municipality must be credited against the municipality's contract obligation; and

(3) for each municipality which contracts with another municipality for police service, a proportionate amount of the state aid distributed to the municipality providing contract service based on the full-time equivalent number of peace officers providing contract service to that municipality on a full-time equivalent basis must be credited against the contract obligation of the municipality receiving contract service.

(b) Any necessary additional adjustments must be made to subsequent police state aid apportionments.

Subd. 8.

Population and estimated market value.

(a) In computations relating to fire state aid requiring the use of population figures, only official statewide federal census figures may be used. Increases or decreases in population disclosed by reason of any special census must not be taken into consideration.

(b) In calculations relating to fire state aid requiring the use of estimated market value property figures, only the latest available estimated market value property figures may be used.

Subd. 9.

Appeal.

(a) In the event that a municipality, a county, a fire relief association, the Department of Natural Resources, the Department of Public Safety, or the voluntary statewide lump-sum volunteer firefighter retirement plan, feels itself to be aggrieved, it may request the commissioner to review and adjust the apportionment of funds within the county in the case of police state aid, or within the state in the case of fire state aid.

(b) The decision of the commissioner is subject to appeal, review, and adjustment by the district court in the county in which the applicable municipality or fire department is located or by the Ramsey County District Court with respect to the Department of Natural Resources, the Department of Public Safety, or the voluntary statewide lump-sum volunteer firefighter retirement plan.

Subd. 10.

Reduction in police state aid apportionment.

(a) The commissioner of revenue shall reduce the apportionment of police state aid under subdivisions 5, paragraph (b), 6, and 7a, for eligible employer units by the amount of any excess police state aid.

(b) "Excess police state aid" is:

(1) for counties and for municipalities in which police retirement coverage is provided wholly by the public employees police and fire fund and all police officers are members of the plan governed by sections 353.63 to 353.657, the amount in excess of the employer's total prior calendar year obligation as defined in paragraph (c), as certified by the executive director of the Public Employees Retirement Association;

(2) for the Metropolitan Airports Commission, the amount in excess of the commission's total prior calendar year obligation as defined in paragraph (c), as certified by the executive director of the Public Employees Retirement Association; and

(3) for the Department of Natural Resources and for the Department of Public Safety, the amount in excess of the employer's total prior calendar year obligation under section 352B.02, subdivision 1c, for plan members who are peace officers under section 69.011, subdivision 1, paragraph (g), as certified by the executive director of the Minnesota State Retirement System.

(c) The employer's total prior calendar year obligation with respect to the public employees police and fire plan under paragraph (b), clause (1), is the total prior calendar year obligation under section 353.65, subdivision 3, for police officers as defined in section 353.64, subdivisions 1, 1a, and 2, and the actual total prior calendar year obligation under section 353.65, subdivision 3, for firefighters, as defined in section 353.64, subdivisions 1, 1a, and 2, but not to exceed for those firefighters the applicable following employer calendar year amount:

	Municipality	Maximum Amount
	Albert Lea	$54,157.01
	Anoka	10,399.31
	Apple Valley	5,442.44
	Austin	49,864.73
	Bemidji	27,671.38
	Brooklyn Center	6,605.92
	Brooklyn Park	24,002.26
	Burnsville	15,956.00
	Cloquet	4,260.49
	Coon Rapids	39,920.00
	Cottage Grove	8,588.48
	Crystal	5,855.00
	East Grand Forks	51,009.88
	Edina	32,251.00
	Elk River	5,216.55
	Ely	13,584.16
	Eveleth	16,288.27
	Fergus Falls	6,742.00
	Fridley	33,420.64
	Golden Valley	11,744.61
	Hastings	16,561.00
	Hopkins	4,324.23
	International Falls	14,400.69
	Lakeville	782.35
	Lino Lakes	5,324.00
	Little Falls	7,889.41
	Maple Grove	6,707.54
	Maplewood	8,476.69
	Minnetonka	10,403.00
	Montevideo	1,307.66
	Moorhead	68,069.26
	New Hope	6,739.72
	North St. Paul	4,241.14
	Northfield	770.63
	Owatonna	37,292.67
	Plymouth	6,754.71
	Red Wing	3,504.01
	Richfield	53,757.96
	Rosemount	1,712.55
	Roseville	9,854.51
	St. Anthony	33,055.00
	St. Louis Park	53,643.11
	Thief River Falls	28,365.04
	Virginia	31,164.46
	Waseca	11,135.17
	West St. Paul	15,707.20
	White Bear Lake	6,521.04
	Woodbury	3,613.00
	any other municipality	0.00

(d) The total amount of excess police state aid must be deposited in the excess police state-aid account in the general fund, administered and distributed as provided in subdivision 11.

Subd. 11.

Excess police state-aid holding account.

(a) The excess police state-aid holding account is established in the general fund. The excess police state-aid holding account must be administered by the commissioner.

(b) Excess police state aid determined according to subdivision 10, must be deposited annually in the excess police state-aid holding account.

(c) From the balance in the excess police state-aid holding account, $900,000 must be canceled annually to the general fund.

(d) On October 1 of each year, one-half of the balance of the excess police state-aid holding account remaining after the deduction under paragraph (c) is appropriated for additional amortization aid under section 423A.02, subdivision 1b.

(e) Annually, the remaining balance in the excess police state-aid holding account, after the deductions under paragraphs (c) and (d) cancels to the general fund.

69.022 VOLUNTEER RETENTION STIPEND AID PILOT.

Subdivision 1.

Definitions.

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

(b) "Commissioner," unless otherwise specified, means the commissioner of public safety.

(c) "Emergency medical services provider" means a licensee as defined under section 144E.001, subdivision 8.

(d) "Independent nonprofit firefighting corporation" has the same meaning as used in chapter 424A.

(e) "Municipality" has the meaning given in section 69.011, but only if the municipality uses one or more qualified volunteers to provide service.

(f) "Qualified entity" means an emergency medical services provider, independent nonprofit firefighting corporation, or municipality.

(g) "Qualified volunteer" means one of the following types of volunteers who has provided service, for the entire prior calendar year, to one or more qualified entities:

(1) a volunteer firefighter as defined in section 299N.03, subdivision 7;

(2) a volunteer ambulance attendant as defined in section 144E.001, subdivision 15; or

(3) an emergency medical responder as defined in section 144E.001, subdivision 6, who provides emergency medical services as a volunteer.

(h) "Pilot area" means the following groups of counties:

(1) southern Minnesota, consisting of the counties of Faribault, Fillmore, Freeborn, Houston, and Watonwan;

(2) west central Minnesota, consisting of the counties of Chippewa, Kandiyohi, Redwood, and Renville;

(3) central Minnesota, consisting of the counties of Morrison and Todd; and

(4) north central Minnesota, consisting of the counties of Beltrami, Clearwater, and Mahnomen.

Subd. 2.

Certification.

By June 1 of the calendar year following the year in which the qualified volunteer provided service, the commissioner shall certify to the commissioner of revenue each qualified volunteer's name and the qualified entity for which the qualified volunteer provided service, but the commissioner must remove duplicate listings of qualified volunteers who provided service to more than one qualified entity so that each qualified volunteer is listed only once. The commissioner shall also certify to the commissioner of revenue the total amount of aid to be paid to each qualified entity under subdivision 3. For qualified entities that are not municipalities, the commissioner must indicate the municipality to which the aid is to be paid, as designated by the qualified entity.

Subd. 3.

Aid payment and calculation.

The commissioner of revenue shall pay aid to qualified entities located in the pilot area to provide funds for the qualified entities to pay annual volunteer retention stipends to qualified volunteers who provide services to the qualified entities. A qualified entity is located in the pilot area if it is a municipality located in whole or in part in the pilot area, or if it is an emergency medical services provider or independent nonprofit firefighting corporation with its main office located in the pilot area. The amount of the aid equals $500 multiplied by the number of qualified volunteers. For purposes of calculating this aid, each individual providing volunteer service, regardless of the different types of service provided, is one qualified volunteer. The commissioner of revenue shall pay the aid to qualified entities by July 15 of the calendar year following the year in which the qualified volunteer provided service. If a qualified entity is not a municipality, the commissioner shall pay the aid to the treasurer of the municipality designated by the qualified entity. The treasurer of the municipality shall, within 30 days of receipt of the aid, transmit the aid to the qualified entity.

Subd. 4.

Application.

Each year each qualified entity in the pilot area may apply to the commissioner for aid under this section. The application must be made at the time and in the form prescribed by the commissioner and must provide sufficient information to permit the commissioner to determine the applicant's entitlement to aid under this section.

Subd. 5.

Payment of stipends.

A qualified entity receiving state aid under this section must pay the aid as retention stipends of $500 to qualified volunteers no later than September 15 of the year in which the aid was received.

Subd. 6.

Report.

No later than January 15, 2018, the commissioner must report to the chairs and ranking minority members of the legislative committees having jurisdiction over public safety and taxes in the senate and the house of representatives, in compliance with sections 3.195 and 3.197, on aid paid under this section. The report must include:

(1) for each county in the pilot area, a listing of the qualified entities that received aid in each of the three years of the pilot;

(2) the amount of aid paid to each qualified entity that received aid in each of the three years of the pilot; and

(3) for each qualified entity that received aid, the number of qualified volunteers who were paid stipends in each of the three years of the pilot, and the number of qualified volunteers in the year preceding the pilot.

The report must also provide information on the number of qualified volunteers providing service to qualified entities in comparison counties in each of the three years of the pilot and in the year preceding the pilot, and must summarize changes in the number of qualified volunteers during the year preceding the pilot and during the three years of the pilot both within the pilot area and in the comparison counties. For purposes of this subdivision, "comparison counties" means counties designated by the commissioner to include at least half of the counties that border each group of counties in the pilot area, as specified in subdivision 1. Qualified entities in comparison counties must provide information to the commissioner necessary to the report in this subdivision in the form and manner required by the commissioner.

Subd. 7.

Appropriation.

An amount sufficient to pay the state aid under this section is appropriated from the general fund to the commissioner of revenue.

Subd. 8.

Sunset.

This section expires for aid payable after calendar year 2017, except that the reporting requirement in subdivision 6 remains in effect through 2018.

69.031 COMMISSIONER OF MANAGEMENT AND BUDGET; WARRANT, APPROPRIATION, PAYMENT AND ADMINISTRATION.

Subdivision 1.

Commissioner's warrant.

(a) The commissioner of management and budget shall issue to the Public Employees Retirement Association on behalf of a municipality or independent nonprofit firefighting corporation that is a member of the voluntary statewide lump-sum volunteer firefighter retirement plan under chapter 353G, to the Department of Natural Resources, the Department of Public Safety, or the county, municipality, or independent nonprofit firefighting corporation certified to the commissioner of management and budget by the commissioner a warrant for an amount equal to the amount of fire state aid or police state aid, whichever applies, certified for the applicable state aid recipient by the commissioner under section 69.021.

(b) Fire state aid and police state aid is payable on October 1 annually. The amount of state aid due and not paid by October 1 accrues interest payable to the state aid recipient at the rate of one percent for each month or part of a month that the amount remains unpaid after October 1.

Subd. 3.

Appropriations.

There is hereby appropriated annually from the state general fund to the commissioner of revenue amounts sufficient to make the police state aid payments and the fire state aid payments specified in this section and section 69.021.

Subd. 5.

Deposit of state aid.

(a) If the municipality or the independent nonprofit firefighting corporation is covered by the voluntary statewide lump-sum volunteer firefighter retirement plan under chapter 353G, the executive director shall credit the fire state aid against future municipal contribution requirements under section 353G.08 and shall notify the municipality or independent nonprofit firefighting corporation of the fire state aid so credited at least annually. If the municipality or the independent nonprofit firefighting corporation is not covered by the voluntary statewide lump-sum volunteer firefighter retirement plan, the municipal treasurer shall, within 30 days after receipt, transmit the fire state aid to the treasurer of the duly incorporated firefighters' relief association if there is one organized and the association has filed a financial report with the municipality. If the relief association has not filed a financial report with the municipality, the municipal treasurer shall delay transmission of the fire state aid to the relief association until the complete financial report is filed. If the municipality or independent nonprofit firefighting corporation is not covered by the voluntary statewide lump-sum volunteer firefighter retirement plan, if there is no relief association organized, or if the association has dissolved or has been removed as trustees of state aid, then the treasurer of the municipality shall deposit the money in the municipal treasury and the money may be disbursed only for the purposes and in the manner set forth in section 424A.08 or for the payment of the employer contribution requirement with respect to firefighters covered by the public employees police and fire retirement plan under section 353.65, subdivision 3.

(b) For a municipality in which police retirement coverage is provided by the public employees police and fire fund and all peace officers are members of the fund, including municipalities covered by section 353.665, the total state aid must be applied toward the municipality's employer contribution to the public employees police and fire fund under sections 353.65, subdivision 3, and 353.665, subdivision 8.

(c) The county treasurer, upon receipt of the police state aid for the county, shall apply the total state aid toward the county's employer contribution to the public employees police and fire fund under section 353.65, subdivision 3.

(d) The designated Metropolitan Airports Commission official, upon receipt of the police state aid for the Metropolitan Airports Commission, shall apply the total police state aid toward the commission's employer contribution for police officers to the public employees police and fire plan under section 353.65, subdivision 3.

(e) The police state aid apportioned to the Departments of Public Safety and Natural Resources under section 69.021, subdivision 7a, is appropriated to the commissioner of management and budget for transfer to the funds and accounts from which the salaries of peace officers certified under section 69.011, subdivision 2b, are paid. The commissioner of revenue shall certify to the commissioners of public safety, natural resources, and management and budget the amounts to be transferred from the appropriation for police state aid. The commissioners of public safety and natural resources shall certify to the commissioner of management and budget the amounts to be credited to each of the funds and accounts from which the peace officers employed by their respective departments are paid. Each commissioner shall allocate the police state aid first for employer contributions for employees funded from the general fund and then for employer contributions for employees funded from other funds. For peace officers whose salaries are paid from the general fund, the amounts transferred from the appropriation for police state aid must be canceled to the general fund.

69.041 SHORTFALL FROM GENERAL FUND.

(a) If the annual funding requirements of fire or police relief associations or consolidation accounts under sections 424A.091 to 424A.095, or Laws 2013, chapter 111, article 5, sections 31 to 42, exceed all applicable revenue sources of a given year, including the insurance premium taxes funding the applicable fire or police state aid as set under section 297I.05, subdivisions 2, 3, and 4, the shortfall in the annual funding requirements must be paid from the general fund to the extent appropriated by the legislature.

(b) Nothing in this section may be deemed to relieve any municipality from its obligation to a relief association or consolidation account under law.

69.051 FINANCIAL REPORT, BOND, EXAMINATION.

Subdivision 1.

Financial report and audit.

(a) The board of the Bloomington Fire Department Relief Association and each volunteer firefighters relief association as defined in section 424A.001, subdivision 4, with assets of at least $500,000 or liabilities of at least $500,000 in the prior year or in any previous year, according to the applicable actuarial valuation or according to the financial report if no valuation is required, shall prepare a financial report covering the special and general funds of the relief association for the preceding fiscal year, file the financial report, and submit financial statements.

(b) The financial report must contain financial statements and disclosures which present the true financial condition of the relief association and the results of relief association operations in conformity with generally accepted accounting principles and in compliance with the regulatory, financing and funding provisions of this chapter and any other applicable laws. The financial report must be countersigned by:

(1) the municipal clerk or clerk-treasurer of the municipality in which the relief association is located if the relief association is a firefighters relief association which is directly associated with a municipal fire department; or

(2) by the municipal clerk or clerk-treasurer of the largest municipality in population which contracts with the independent nonprofit firefighting corporation if the volunteer firefighter relief association is a subsidiary of an independent nonprofit firefighting corporation and by the secretary of the independent nonprofit firefighting corporation; or

(3) by the chief financial official of the county in which the volunteer firefighter relief association is located or primarily located if the relief association is associated with a fire department that is not located in or associated with an organized municipality.

(c) The financial report must be retained in its office for public inspection and must be filed with the governing body of the government subdivision in which the associated fire department is located after the close of the fiscal year. One copy of the financial report must be furnished to the state auditor after the close of the fiscal year.

(d) Audited financial statements must be attested to by a certified public accountant or by the state auditor and must be filed with the state auditor within 180 days after the close of the fiscal year. The state auditor may accept this report in lieu of the report required in paragraph (c).

Subd. 1a.

Financial statement.

(a) The board of each volunteer firefighter relief association, as defined in section 424A.001, subdivision 4, that is not required to file a financial report and audit under subdivision 1 must prepare a detailed statement of the financial affairs for the preceding fiscal year of the relief association's special and general funds in the style and form prescribed by the state auditor. The detailed statement must show:

(1) the sources and amounts of all money received;

(2) all disbursements, accounts payable and accounts receivable;

(3) the amount of money remaining in the treasury;

(4) total assets, including a listing of all investments;

(5) the accrued liabilities; and

(6) all other items necessary to show accurately the revenues and expenditures and financial position of the relief association.

(b) The detailed financial statement of the special and general funds required under paragraph (a) must be certified by a certified public accountant or by the state auditor in accordance with agreed-upon procedures and forms prescribed by the state auditor. The accountant must have at least five years of public accounting, auditing, or similar experience, and must not be an active, inactive, or retired member of the relief association or the fire department.

(c) The detailed financial statement required under paragraph (a) must be countersigned by:

(1) the municipal clerk or clerk-treasurer of the municipality; or

(2) where applicable, by the municipal clerk or clerk-treasurer of the largest municipality in population which contracts with the independent nonprofit firefighting corporation if the relief association is a subsidiary of an independent nonprofit firefighting corporation and by the secretary of the independent nonprofit firefighting corporation; or

(3) by the chief financial official of the county in which the volunteer firefighter relief association is located or primarily located if the relief association is associated with a fire department that is not located in or associated with an organized municipality.

(d) The volunteer firefighters' relief association board must file the detailed financial statement required under paragraph (a) in the relief association office for public inspection and present it to the governing body of the municipality within 45 days after the close of the fiscal year, and must submit a copy of the certified detailed financial statement to the state auditor within 90 days of the close of the fiscal year.

(e) A certified public accountant or auditor who performs the agreed-upon procedures under paragraph (b) is subject to the reporting requirements of section 6.67.

Subd. 1b.

Qualification.

The state auditor may, upon a demonstration by a relief association of hardship or an inability to conform, extend the deadline for reports under subdivisions 1 or 1a, but not beyond November 30th following the due date. If the reports are not received by November 30th, the municipality or relief association forfeits its current year state aid, and, until the state auditor receives the required information, the relief association or municipality is ineligible to receive any future state aid. A municipality or firefighters' relief association does not qualify initially to receive, or be entitled subsequently to retain, state aid under this chapter if the financial reporting requirement or the applicable requirements of this chapter or any other statute or special law have not been complied with or are not fulfilled.

Subd. 2.

Treasurers bond.

(a) The treasurer of the Bloomington Fire Department Relief Association may not enter upon duties without having given the association a bond in a reasonable amount acceptable to the municipality for the faithful discharge of duties according to law.

(b) No treasurer of a relief association governed by sections 424A.091 to 424A.096 may enter upon the duties of the office until the treasurer has given the association a good and sufficient bond in an amount equal to at least ten percent of the assets of the relief association; however, the amount of the bond need not exceed $500,000.

Subd. 3.

Report by certain municipalities; exceptions.

(a) The chief administrative officer of each municipality which has an organized fire department but which does not have a firefighters' relief association governed by sections 424A.091 to 424A.095 or Laws 2014, chapter 275, article 2, section 23, and which is not exempted under paragraph (b) or (c) shall annually prepare a detailed financial report of the receipts and disbursements by the municipality for fire protection service during the preceding calendar year on a form prescribed by the state auditor. The financial report must contain any information which the state auditor deems necessary to disclose the sources of receipts and the purpose of disbursements for fire protection service. The financial report must be signed by the municipal clerk or clerk-treasurer of the municipality. The financial report must be filed by the municipal clerk or clerk-treasurer with the state auditor on or before July 1 annually. The municipality does not qualify initially to receive, and is not entitled subsequently to retain, state aid under this chapter if the financial reporting requirement or the applicable requirements of this chapter or any other statute or special law have not been complied with or are not fulfilled.

(b) Each municipality that has an organized fire department and provides retirement coverage to its firefighters through the voluntary statewide lump-sum volunteer firefighter retirement plan under chapter 353G qualifies to have fire state aid transmitted to and retained in the statewide lump-sum volunteer firefighter retirement fund without filing a detailed financial report if the executive director of the Public Employees Retirement Association certifies compliance by the municipality with the requirements of sections 353G.04 and 353G.08, paragraph (e), and certifies conformity by the applicable fire chief with the requirements of section 353G.07.

(c) Each municipality qualifies to receive fire state aid under this chapter without filing a financial report under paragraph (a) if the municipality:

(1) has an organized fire department;

(2) does not have a volunteer firefighters relief association directly associated with its fire department;

(3) does not participate in the statewide lump-sum volunteer firefighter retirement plan under chapter 353G;

(4) provides retirement coverage to its firefighters through the public employees police and fire retirement plan under sections 353.63 to 353.68; and

(5) is certified by the executive director of the Public Employees Retirement Association to the state auditor to have had an employer contribution under section 353.65, subdivision 3, for its firefighters for the immediately prior calendar year equal to or greater than its fire state aid for the immediately prior calendar year.

Subd. 4.

Notification by commissioner and state auditor.

(a) The state auditor, in performing an audit or examination, shall notify the Legislative Commission on Pensions and Retirement if the audit or examination reveals malfeasance, misfeasance, or nonfeasance in office by relief association officials or municipal officials.

(b) The commissioner shall notify the Legislative Commission on Pensions and Retirement if the state auditor has not filed the required financial compliance reports by July 1.

69.33 REPORT; AMOUNT OF PREMIUMS RECEIVED BY INSURANCE COMPANIES.

For purposes of the first class city fire insurance premium tax surcharge aid program under section 297I.10, the commissioner shall enclose in the annual statement blank that is sent to all fire insurance companies doing business in this state a blank form containing the names of all cities of the first class and require these companies, at the time of making their annual statements to the commissioner, to state on these blanks the amount of premiums received by them upon properties insured within the corporate limits of the cities named thereon during the year ending December 31st last past. Thereafter, before July first each year, the commissioner shall certify to the commissioner of management and budget the information thus obtained, together with the amount of the tax for the benefit of the pension plans covering firefighters in cities of the first class paid in such year by these companies upon these insurance premiums.

69.80 AUTHORIZED ADMINISTRATIVE EXPENSES.

(a) Notwithstanding any provision of law to the contrary, the payment of the following necessary, reasonable and direct expenses of maintaining, protecting and administering the special fund, when provided for in the bylaws of the association and approved by the board of trustees, constitutes authorized administrative expenses of a volunteer firefighters' relief association organized under any law of this state or the Bloomington Fire Department Relief Association:

(1) office expense, including, but not limited to, rent, utilities, equipment, supplies, postage, periodical subscriptions, furniture, fixtures, and salaries of administrative personnel;

(2) salaries of the officers of the association, or their designees, and salaries of the members of the board of trustees of the association if the salary amounts are approved by the governing body of the entity that is responsible for meeting any minimum obligation under section 424A.092 or 424A.093, or Laws 2013, chapter 111, article 5, sections 31 to 42, and the itemized expenses of relief association officers and board members that are incurred as a result of fulfilling their responsibilities as administrators of the special fund;

(3) tuition, registration fees, organizational dues, and other authorized expenses of the officers or members of the board of trustees incurred in attending educational conferences, seminars, or classes relating to the administration of the relief association;

(4) audit and audit-related services, accounting and accounting-related services, and actuarial, medical, legal, and investment and performance evaluation expenses;

(5) filing and application fees payable by the relief association to federal or other governmental entities;

(6) reimbursement to the officers and members of the board of trustees, or their designees, for reasonable and necessary expenses actually paid and incurred in the performance of their duties as officers or members of the board; and

(7) premiums on fiduciary liability insurance and official bonds for the officers, members of the board of trustees, and employees of the relief association.

(b) Any other expenses of the relief association must be paid from the general fund of the association, if one exists. If a relief association has only one fund, that fund is the special fund for purposes of this section. If a relief association has a special fund and a general fund, and any expense of the relief association that is directly related to the purposes for which both funds were established, the payment of that expense must be apportioned between the two funds on the basis of the benefits derived by each fund.

270C.131 EXPLORE MINNESOTA TOURISM TAX REPORT.

Within 30 days of the end of each quarter, the Department of Revenue shall provide Explore Minnesota Tourism with a quarterly report of comparisons of quarterly sales taxes collected under the Standard Industrial Classification System, or equivalent codes in the North America Industry Classification System, in the following areas:

(1) SIC 70, lodging;

(2) SIC 79, amusement and recreation; and

(3) SIC 58, eating and drinking.

275.29 ABSTRACTS TO COMMISSIONER OF REVENUE.

Not later than March 31, in each year, the county auditor shall make and transmit to the commissioner of revenue, in such form as may be prescribed by the commissioner of revenue, complete abstracts of the tax lists of the county, showing the number of acres of land assessed; its value, including the structures thereon; the value of town and city lots, including structures; the total value of all taxable personal property in the several assessment districts; the aggregate amount of all taxable property in the county, and the total amount of taxes levied therein for state, county, town, and all other purposes for that year.

297I.25 INFORMATION RETURNS.

Subd. 2.

Firetown and police premium reports.

To the extent required by section 69.021, each insurer shall file with the commissioner a Minnesota firetown premium report and Minnesota aid to police premium report.