SF 2776

as introduced - 79th Legislature (1995 - 1996) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to taxation; property; increasing the value 
  1.3             of homestead property subject to the one percent 
  1.4             classification rate; amending Minnesota Statutes 1994, 
  1.5             section 273.13, subdivision 22; Minnesota Statutes 
  1.6             1995 Supplement, section 273.1398, subdivision 1. 
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  Minnesota Statutes 1994, section 273.13, 
  1.9   subdivision 22, is amended to read: 
  1.10     Subd. 22.  [CLASS 1.] (a) Except as provided in subdivision 
  1.11  23, real estate which is residential and used for homestead 
  1.12  purposes is class 1.  The market value of class 1a property must 
  1.13  be determined based upon the value of the house, garage, and 
  1.14  land.  
  1.15     The first $72,000 $80,000 of market value of class 1a 
  1.16  property has a net class rate of one percent of its market value 
  1.17  and a gross class rate of 2.17 percent of its market value.  For 
  1.18  taxes payable in 1992, the market value of class 1a property 
  1.19  that exceeds $72,000 but does not exceed $115,000 has a class 
  1.20  rate of two percent of its market value; and the market value of 
  1.21  class 1a property that exceeds $115,000 has a class rate of 2.5 
  1.22  percent of its market value.  For taxes payable in 1993 and 
  1.23  thereafter, The market value of class 1a property that exceeds 
  1.24  $72,000 $80,000 has a class rate of two percent. 
  1.25     (b) Class 1b property includes homestead real estate or 
  1.26  homestead manufactured homes used for the purposes of a 
  2.1   homestead by 
  2.2      (1) any blind person, or the blind person and the blind 
  2.3   person's spouse; or 
  2.4      (2) any person, hereinafter referred to as "veteran," who: 
  2.5      (i) served in the active military or naval service of the 
  2.6   United States; and 
  2.7      (ii) is entitled to compensation under the laws and 
  2.8   regulations of the United States for permanent and total 
  2.9   service-connected disability due to the loss, or loss of use, by 
  2.10  reason of amputation, ankylosis, progressive muscular 
  2.11  dystrophies, or paralysis, of both lower extremities, such as to 
  2.12  preclude motion without the aid of braces, crutches, canes, or a 
  2.13  wheelchair; and 
  2.14     (iii) has acquired a special housing unit with special 
  2.15  fixtures or movable facilities made necessary by the nature of 
  2.16  the veteran's disability, or the surviving spouse of the 
  2.17  deceased veteran for as long as the surviving spouse retains the 
  2.18  special housing unit as a homestead; or 
  2.19     (3) any person who: 
  2.20     (i) is permanently and totally disabled and 
  2.21     (ii) receives 90 percent or more of total income from 
  2.22     (A) aid from any state as a result of that disability; or 
  2.23     (B) supplemental security income for the disabled; or 
  2.24     (C) workers' compensation based on a finding of total and 
  2.25  permanent disability; or 
  2.26     (D) social security disability, including the amount of a 
  2.27  disability insurance benefit which is converted to an old age 
  2.28  insurance benefit and any subsequent cost of living increases; 
  2.29  or 
  2.30     (E) aid under the federal Railroad Retirement Act of 1937, 
  2.31  United States Code Annotated, title 45, section 228b(a)5; or 
  2.32     (F) a pension from any local government retirement fund 
  2.33  located in the state of Minnesota as a result of that 
  2.34  disability; or 
  2.35     (4) any person who is permanently and totally disabled and 
  2.36  whose household income as defined in section 290A.03, 
  3.1   subdivision 5, is 150 percent or less of the federal poverty 
  3.2   level. 
  3.3      Property is classified and assessed under clause (4) only 
  3.4   if the government agency or income-providing source certifies, 
  3.5   upon the request of the homestead occupant, that the homestead 
  3.6   occupant satisfies the disability requirements of this paragraph.
  3.7      Property is classified and assessed pursuant to clause (1) 
  3.8   only if the commissioner of economic security certifies to the 
  3.9   assessor that the homestead occupant satisfies the requirements 
  3.10  of this paragraph.  
  3.11     Permanently and totally disabled for the purpose of this 
  3.12  subdivision means a condition which is permanent in nature and 
  3.13  totally incapacitates the person from working at an occupation 
  3.14  which brings the person an income.  The first $32,000 market 
  3.15  value of class 1b property has a net class rate of .45 percent 
  3.16  of its market value and a gross class rate of .87 percent of its 
  3.17  market value.  The remaining market value of class 1b property 
  3.18  has a gross or net class rate using the rates for class 1 or 
  3.19  class 2a property, whichever is appropriate, of similar market 
  3.20  value.  
  3.21     (c) Class 1c property is commercial use real property that 
  3.22  abuts a lakeshore line and is devoted to temporary and seasonal 
  3.23  residential occupancy for recreational purposes but not devoted 
  3.24  to commercial purposes for more than 250 days in the year 
  3.25  preceding the year of assessment, and that includes a portion 
  3.26  used as a homestead by the owner, which includes a dwelling 
  3.27  occupied as a homestead by a shareholder of a corporation that 
  3.28  owns the resort or a partner in a partnership that owns the 
  3.29  resort, even if the title to the homestead is held by the 
  3.30  corporation or partnership.  For purposes of this clause, 
  3.31  property is devoted to a commercial purpose on a specific day if 
  3.32  any portion of the property, excluding the portion used 
  3.33  exclusively as a homestead, is used for residential occupancy 
  3.34  and a fee is charged for residential occupancy.  Class 1c 
  3.35  property has a class rate of one percent of total market value 
  3.36  for taxes payable in 1993 and thereafter with the following 
  4.1   limitation:  the area of the property must not exceed 100 feet 
  4.2   of lakeshore footage for each cabin or campsite located on the 
  4.3   property up to a total of 800 feet and 500 feet in depth, 
  4.4   measured away from the lakeshore.  
  4.5      Sec. 2.  Minnesota Statutes 1995 Supplement, section 
  4.6   273.1398, subdivision 1, is amended to read: 
  4.7      Subdivision 1.  [DEFINITIONS.] (a) In this section, the 
  4.8   terms defined in this subdivision have the meanings given them. 
  4.9      (b) "Unique taxing jurisdiction" means the geographic area 
  4.10  subject to the same set of local tax rates. 
  4.11     (c) "Net tax capacity" means the product of (i) the 
  4.12  appropriate net class rates for the year in which the aid is 
  4.13  payable, except that for aid payable in 1996 the class rate 
  4.14  applicable to all class 4a shall be 3.4 percent; and (ii) 
  4.15  estimated market values for the assessment two years prior to 
  4.16  that in which aid is payable.  For aid payable in 1997, the net 
  4.17  class rate applied to class 1a, 1b, and the part of class 2a 
  4.18  property consisting of the house, garage, and surrounding one 
  4.19  acre of land shall be two percent for the market value between 
  4.20  $72,000 and $80,000.  "Total net tax capacity" means the net tax 
  4.21  capacities for all property within the unique taxing 
  4.22  jurisdiction.  The total net tax capacity used shall be reduced 
  4.23  by the sum of (1) the unique taxing jurisdiction's net tax 
  4.24  capacity of commercial industrial property as defined in section 
  4.25  473F.02, subdivision 3, multiplied by the ratio determined 
  4.26  pursuant to section 473F.08, subdivision 6, for the 
  4.27  municipality, as defined in section 473F.02, subdivision 8, in 
  4.28  which the unique taxing jurisdiction is located, (2) the net tax 
  4.29  capacity of the captured value of tax increment financing 
  4.30  districts as defined in section 469.177, subdivision 2, and (3) 
  4.31  the net tax capacity of transmission lines deducted from a local 
  4.32  government's total net tax capacity under section 273.425.  For 
  4.33  purposes of determining the net tax capacity of property 
  4.34  referred to in clauses (1), (2), and (3), the net tax capacity 
  4.35  shall be multiplied by the ratio of the highest class rate for 
  4.36  class 3a property for taxes payable in the year in which the aid 
  5.1   is payable to the highest class rate for class 3a property in 
  5.2   the prior year.  Net tax capacity cannot be less than zero. 
  5.3      (d) "Previous net tax capacity" means the product of the 
  5.4   appropriate net class rates for the year previous to the year in 
  5.5   which the aid is payable, and estimated market values for the 
  5.6   assessment two years prior to that in which aid is payable.  
  5.7   "Total previous net tax capacity" means the previous net tax 
  5.8   capacities for all property within the unique taxing 
  5.9   jurisdiction.  The total previous net tax capacity shall be 
  5.10  reduced by the sum of (1) the unique taxing jurisdiction's 
  5.11  previous net tax capacity of commercial-industrial property as 
  5.12  defined in section 473F.02, subdivision 3, multiplied by the 
  5.13  ratio determined pursuant to section 473F.08, subdivision 6, for 
  5.14  the municipality, as defined in section 473F.02, subdivision 8, 
  5.15  in which the unique taxing jurisdiction is located, (2) the 
  5.16  previous net tax capacity of the captured value of tax increment 
  5.17  financing districts as defined in section 469.177, subdivision 
  5.18  2, and (3) the previous net tax capacity of transmission lines 
  5.19  deducted from a local government's total net tax capacity under 
  5.20  section 273.425.  Previous net tax capacity cannot be less than 
  5.21  zero. 
  5.22     (e) "Equalized market values" are market values that have 
  5.23  been equalized by dividing the assessor's estimated market value 
  5.24  for the second year prior to that in which the aid is payable by 
  5.25  the assessment sales ratios determined by class in the 
  5.26  assessment sales ratio study conducted by the department of 
  5.27  revenue pursuant to section 124.2131 in the second year prior to 
  5.28  that in which the aid is payable.  The equalized market values 
  5.29  shall equal the unequalized market values divided by the 
  5.30  assessment sales ratio. 
  5.31     (f) "Equalized school levies" means the amounts levied for: 
  5.32     (1) general education under section 124A.23, subdivision 2; 
  5.33     (2) supplemental revenue under section 124A.22, subdivision 
  5.34  8a; 
  5.35     (3) capital expenditure facilities revenue under section 
  5.36  124.243, subdivision 3; 
  6.1      (4) capital expenditure equipment revenue under section 
  6.2   124.244, subdivision 2; 
  6.3      (5) basic transportation under section 124.226, subdivision 
  6.4   1; and 
  6.5      (6) referendum revenue under section 124A.03. 
  6.6      (g) "Current local tax rate" means the quotient derived by 
  6.7   dividing the taxes levied within a unique taxing jurisdiction 
  6.8   for taxes payable in the year prior to that for which aids are 
  6.9   being calculated by the total previous net tax capacity of the 
  6.10  unique taxing jurisdiction.  
  6.11     (h) For purposes of calculating and allocating homestead 
  6.12  and agricultural credit aid authorized pursuant to subdivision 2 
  6.13  and the disparity reduction aid authorized in subdivision 3, 
  6.14  "gross taxes levied on all properties," "gross taxes," or "taxes 
  6.15  levied" means the total net tax capacity based taxes levied on 
  6.16  all properties except that levied on the captured value of tax 
  6.17  increment districts as defined in section 469.177, subdivision 
  6.18  2, and that levied on the portion of commercial industrial 
  6.19  properties' assessed value or gross tax capacity, as defined in 
  6.20  section 473F.02, subdivision 3, subject to the areawide tax as 
  6.21  provided in section 473F.08, subdivision 6, in a unique taxing 
  6.22  jurisdiction.  "Gross taxes" are before any reduction for 
  6.23  disparity reduction aid but "taxes levied" are after any 
  6.24  reduction for disparity reduction aid.  Gross taxes levied or 
  6.25  taxes levied cannot be less than zero.  
  6.26     "Taxes levied" excludes equalized school levies. 
  6.27     (i) "Human services aids" means: 
  6.28     (1) aid to families with dependent children under sections 
  6.29  256.82, subdivision 1, and 256.935, subdivision 1; 
  6.30     (2) medical assistance under sections 256B.041, subdivision 
  6.31  5, and 256B.19, subdivision 1; 
  6.32     (3) general assistance medical care under section 256D.03, 
  6.33  subdivision 6; 
  6.34     (4) general assistance under section 256D.03, subdivision 
  6.35  2; 
  6.36     (5) work readiness under section 256D.03, subdivision 2; 
  7.1      (6) emergency assistance under section 256.871, subdivision 
  7.2   6; 
  7.3      (7) Minnesota supplemental aid under section 256D.36, 
  7.4   subdivision 1; 
  7.5      (8) preadmission screening and alternative care grants; 
  7.6      (9) work readiness services under section 256D.051; 
  7.7      (10) case management services under section 256.736, 
  7.8   subdivision 13; 
  7.9      (11) general assistance claims processing, medical 
  7.10  transportation and related costs; and 
  7.11     (12) medical assistance, medical transportation and related 
  7.12  costs. 
  7.13     (j) "Household adjustment factor" means the number of 
  7.14  households for the second most recent year preceding that in 
  7.15  which the aids are payable divided by the number of households 
  7.16  for the third most recent year.  The household adjustment factor 
  7.17  cannot be less than one.  
  7.18     (k) "Growth adjustment factor" means the household 
  7.19  adjustment factor in the case of counties.  In the case of 
  7.20  cities, towns, school districts, and special taxing districts, 
  7.21  the growth adjustment factor equals one.  The growth adjustment 
  7.22  factor cannot be less than one.  
  7.23     (l) For aid payable in 1992 and subsequent years, 
  7.24  "homestead and agricultural credit base" means the previous 
  7.25  year's certified homestead and agricultural credit aid 
  7.26  determined under subdivision 2 less any permanent aid reduction 
  7.27  in the previous year to homestead and agricultural credit aid 
  7.28  under section 477A.0132, plus, for aid payable in 1992, fiscal 
  7.29  disparity homestead and agricultural credit aid under 
  7.30  subdivision 2b.  
  7.31     (m) "Net tax capacity adjustment" means (1) the total 
  7.32  previous net tax capacity minus the total net tax capacity, 
  7.33  multiplied by (2) the unique taxing jurisdiction's current local 
  7.34  tax rate.  The net tax capacity adjustment cannot be less than 
  7.35  zero. 
  7.36     (n) "Fiscal disparity adjustment" means the difference 
  8.1   between (1) a taxing jurisdiction's fiscal disparity 
  8.2   distribution levy under section 473F.08, subdivision 3, clause 
  8.3   (a), for taxes payable in the year prior to that for which aids 
  8.4   are being calculated, and (2) the same distribution levy 
  8.5   multiplied by the ratio of the highest class rate for class 3 
  8.6   property for taxes payable in the year prior to that for which 
  8.7   aids are being calculated to the highest class rate for class 3 
  8.8   property for taxes payable in the second prior year to that for 
  8.9   which aids are being calculated.  In the case of school 
  8.10  districts, the fiscal disparity distribution levy shall exclude 
  8.11  that part of the levy attributable to equalized school levies. 
  8.12     Sec. 3.  [EFFECTIVE DATE.] 
  8.13     Section 1 is effective for taxes levied in 1996, payable in 
  8.14  1997, and thereafter.  Section 2 is effective for aid payable in 
  8.15  1997.