SF 3011

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

  1.1                          A bill for an act 
  1.2             relating to taxation; property; changing the class 
  1.3             rates on certain property; changing the market value 
  1.4             credit maximum and phase-out; amending Minnesota 
  1.5             Statutes 2001 Supplement, sections 273.13, 
  1.6             subdivisions 23, 24, 31; 273.1384, subdivision 1. 
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  Minnesota Statutes 2001 Supplement, section 
  1.9   273.13, subdivision 23, is amended to read: 
  1.10     Subd. 23.  [CLASS 2.] (a) Class 2a property is agricultural 
  1.11  land including any improvements that is homesteaded.  The market 
  1.12  value of the house and garage and immediately surrounding one 
  1.13  acre of land has the same class rates as class 1a property under 
  1.14  subdivision 22.  The value of the remaining land including 
  1.15  improvements up to $115,000 has a class rate of 0.35 percent of 
  1.16  market value.  The value of class 2a over $115,000 and up to and 
  1.17  including $600,000 market value has a net class rate of 0.55 
  1.18  percent of market value.  The remaining property over $600,000 
  1.19  market value has a class rate of one percent of market value. 
  1.20     (b) Class 2b property is (1) real estate, rural in 
  1.21  character and used exclusively for growing trees for timber, 
  1.22  lumber, and wood and wood products; (2) real estate that is not 
  1.23  improved with a structure and is used exclusively for growing 
  1.24  trees for timber, lumber, and wood and wood products, if the 
  1.25  owner has participated or is participating in a cost-sharing 
  1.26  program for afforestation, reforestation, or timber stand 
  2.1   improvement on that particular property, administered or 
  2.2   coordinated by the commissioner of natural resources; (3) real 
  2.3   estate that is nonhomestead agricultural land; or (4) a landing 
  2.4   area or public access area of a privately owned public use 
  2.5   airport.  Class 2b property has a net class rate of one percent 
  2.6   of market value. 
  2.7      (c) Agricultural land as used in this section means 
  2.8   contiguous acreage of ten acres or more, used during the 
  2.9   preceding year for agricultural purposes.  "Agricultural 
  2.10  purposes" as used in this section means the raising or 
  2.11  cultivation of agricultural products or enrollment in the 
  2.12  Reinvest in Minnesota program under sections 103F.501 to 
  2.13  103F.535 or the federal Conservation Reserve Program as 
  2.14  contained in Public Law Number 99-198.  Contiguous acreage on 
  2.15  the same parcel, or contiguous acreage on an immediately 
  2.16  adjacent parcel under the same ownership, may also qualify as 
  2.17  agricultural land, but only if it is pasture, timber, waste, 
  2.18  unusable wild land, or land included in state or federal farm 
  2.19  programs.  Agricultural classification for property shall be 
  2.20  determined excluding the house, garage, and immediately 
  2.21  surrounding one acre of land, and shall not be based upon the 
  2.22  market value of any residential structures on the parcel or 
  2.23  contiguous parcels under the same ownership. 
  2.24     (d) Real estate, excluding the house, garage, and 
  2.25  immediately surrounding one acre of land, of less than ten acres 
  2.26  which is exclusively and intensively used for raising or 
  2.27  cultivating agricultural products, shall be considered as 
  2.28  agricultural land.  
  2.29     Land shall be classified as agricultural even if all or a 
  2.30  portion of the agricultural use of that property is the leasing 
  2.31  to, or use by another person for agricultural purposes. 
  2.32     Classification under this subdivision is not determinative 
  2.33  for qualifying under section 273.111. 
  2.34     The property classification under this section supersedes, 
  2.35  for property tax purposes only, any locally administered 
  2.36  agricultural policies or land use restrictions that define 
  3.1   minimum or maximum farm acreage. 
  3.2      (e) The term "agricultural products" as used in this 
  3.3   subdivision includes production for sale of:  
  3.4      (1) livestock, dairy animals, dairy products, poultry and 
  3.5   poultry products, fur-bearing animals, horticultural and nursery 
  3.6   stock described in sections 18.44 to 18.61, fruit of all kinds, 
  3.7   vegetables, forage, grains, bees, and apiary products by the 
  3.8   owner; 
  3.9      (2) fish bred for sale and consumption if the fish breeding 
  3.10  occurs on land zoned for agricultural use; 
  3.11     (3) the commercial boarding of horses if the boarding is 
  3.12  done in conjunction with raising or cultivating agricultural 
  3.13  products as defined in clause (1); 
  3.14     (4) property which is owned and operated by nonprofit 
  3.15  organizations used for equestrian activities, excluding racing; 
  3.16     (5) game birds and waterfowl bred and raised for use on a 
  3.17  shooting preserve licensed under section 97A.115; 
  3.18     (6) insects primarily bred to be used as food for animals; 
  3.19     (7) trees, grown for sale as a crop, and not sold for 
  3.20  timber, lumber, wood, or wood products; and 
  3.21     (8) maple syrup taken from trees grown by a person licensed 
  3.22  by the Minnesota department of agriculture under chapter 28A as 
  3.23  a food processor. 
  3.24     (f) If a parcel used for agricultural purposes is also used 
  3.25  for commercial or industrial purposes, including but not limited 
  3.26  to:  
  3.27     (1) wholesale and retail sales; 
  3.28     (2) processing of raw agricultural products or other goods; 
  3.29     (3) warehousing or storage of processed goods; and 
  3.30     (4) office facilities for the support of the activities 
  3.31  enumerated in clauses (1), (2), and (3), 
  3.32  the assessor shall classify the part of the parcel used for 
  3.33  agricultural purposes as class 1b, 2a, or 2b, whichever is 
  3.34  appropriate, and the remainder in the class appropriate to its 
  3.35  use.  The grading, sorting, and packaging of raw agricultural 
  3.36  products for first sale is considered an agricultural purpose.  
  4.1   A greenhouse or other building where horticultural or nursery 
  4.2   products are grown that is also used for the conduct of retail 
  4.3   sales must be classified as agricultural if it is primarily used 
  4.4   for the growing of horticultural or nursery products from seed, 
  4.5   cuttings, or roots and occasionally as a showroom for the retail 
  4.6   sale of those products.  Use of a greenhouse or building only 
  4.7   for the display of already grown horticultural or nursery 
  4.8   products does not qualify as an agricultural purpose.  
  4.9      The assessor shall determine and list separately on the 
  4.10  records the market value of the homestead dwelling and the one 
  4.11  acre of land on which that dwelling is located.  If any farm 
  4.12  buildings or structures are located on this homesteaded acre of 
  4.13  land, their market value shall not be included in this separate 
  4.14  determination.  
  4.15     (g) To qualify for classification under paragraph (b), 
  4.16  clause (4), a privately owned public use airport must be 
  4.17  licensed as a public airport under section 360.018.  For 
  4.18  purposes of paragraph (b), clause (4), "landing area" means that 
  4.19  part of a privately owned public use airport properly cleared, 
  4.20  regularly maintained, and made available to the public for use 
  4.21  by aircraft and includes runways, taxiways, aprons, and sites 
  4.22  upon which are situated landing or navigational aids.  A landing 
  4.23  area also includes land underlying both the primary surface and 
  4.24  the approach surfaces that comply with all of the following:  
  4.25     (i) the land is properly cleared and regularly maintained 
  4.26  for the primary purposes of the landing, taking off, and taxiing 
  4.27  of aircraft; but that portion of the land that contains 
  4.28  facilities for servicing, repair, or maintenance of aircraft is 
  4.29  not included as a landing area; 
  4.30     (ii) the land is part of the airport property; and 
  4.31     (iii) the land is not used for commercial or residential 
  4.32  purposes. 
  4.33  The land contained in a landing area under paragraph (b), clause 
  4.34  (4), must be described and certified by the commissioner of 
  4.35  transportation.  The certification is effective until it is 
  4.36  modified, or until the airport or landing area no longer meets 
  5.1   the requirements of paragraph (b), clause (4).  For purposes of 
  5.2   paragraph (b), clause (4), "public access area" means property 
  5.3   used as an aircraft parking ramp, apron, or storage hangar, or 
  5.4   an arrival and departure building in connection with the airport.
  5.5      [EFFECTIVE DATE.] This section is effective for taxes 
  5.6   levied in 2002, payable in 2003 and thereafter. 
  5.7      Sec. 2.  Minnesota Statutes 2001 Supplement, section 
  5.8   273.13, subdivision 24, is amended to read: 
  5.9      Subd. 24.  [CLASS 3.] (a) Commercial and industrial 
  5.10  property and utility real and personal property is class 3a.  
  5.11     (1) Except as otherwise provided, each parcel of 
  5.12  commercial, industrial, or utility real property has a class 
  5.13  rate of 1.5 percent of the first tier of market value, and 2.0 
  5.14  2.7 percent of the remaining market value.  In the case of 
  5.15  contiguous parcels of property owned by the same person or 
  5.16  entity, only the value equal to the first-tier value of the 
  5.17  contiguous parcels qualifies for the reduced class rate, except 
  5.18  that contiguous parcels owned by the same person or entity shall 
  5.19  be eligible for the first-tier value class rate on each separate 
  5.20  business operated by the owner of the property, provided the 
  5.21  business is housed in a separate structure.  For the purposes of 
  5.22  this subdivision, the first tier means the first $150,000 of 
  5.23  market value.  Real property owned in fee by a utility for 
  5.24  transmission line right-of-way shall be classified at the class 
  5.25  rate for the higher tier.  
  5.26     For purposes of this subdivision, parcels are considered to 
  5.27  be contiguous even if they are separated from each other by a 
  5.28  road, street, waterway, or other similar intervening type of 
  5.29  property.  Connections between parcels that consist of power 
  5.30  lines or pipelines do not cause the parcels to be contiguous.  
  5.31  Property owners who have contiguous parcels of property that 
  5.32  constitute separate businesses that may qualify for the 
  5.33  first-tier class rate shall notify the assessor by July 1, for 
  5.34  treatment beginning in the following taxes payable year.  
  5.35     (2) All railroad operating property and all property that 
  5.36  is:  (i) part of an electric generation, transmission, or 
  6.1   distribution system; or (ii) part of a pipeline system 
  6.2   transporting or distributing water, gas, crude oil, or petroleum 
  6.3   products; and (iii) not described in clause (3), has a class 
  6.4   rate as provided under clause (1) for the first tier of market 
  6.5   value and the remaining market value.  In the case of multiple 
  6.6   parcels in one county that are owned by one person or entity, 
  6.7   only one first tier amount is eligible for the reduced rate.  
  6.8      (3) The entire market value of personal property that is:  
  6.9   (i) tools, implements, and machinery of an electric generation, 
  6.10  transmission, or distribution system; (ii) tools, implements, 
  6.11  and machinery of a pipeline system transporting or distributing 
  6.12  water, gas, crude oil, or petroleum products; or (iii) the mains 
  6.13  and pipes used in the distribution of steam or hot or chilled 
  6.14  water for heating or cooling buildings, has a class rate as 
  6.15  provided under clause (1) for the remaining market value in 
  6.16  excess of the first tier. 
  6.17     (b) Employment property defined in section 469.166, during 
  6.18  the period provided in section 469.170, shall constitute class 
  6.19  3b.  The class rates for class 3b property are determined under 
  6.20  paragraph (a). 
  6.21     [EFFECTIVE DATE.] This section is effective for taxes 
  6.22  levied in 2002, payable in 2003 and thereafter. 
  6.23     Sec. 3.  Minnesota Statutes 2001 Supplement, section 
  6.24  273.13, subdivision 31, is amended to read: 
  6.25     Subd. 31.  [CLASS 5.] Class 5 property includes:  
  6.26     (1) unmined iron ore and low-grade iron-bearing formations 
  6.27  as defined in section 273.14; and 
  6.28     (2) all other property not otherwise classified. 
  6.29     Class 5 property has a class rate of 2.0 2.7 percent of 
  6.30  market value. 
  6.31     [EFFECTIVE DATE.] This section is effective for taxes 
  6.32  levied in 2002, payable in 2003 and thereafter. 
  6.33     Sec. 4.  Minnesota Statutes 2001 Supplement, section 
  6.34  273.1384, subdivision 1, is amended to read: 
  6.35     Subdivision 1.  [RESIDENTIAL HOMESTEAD MARKET VALUE 
  6.36  CREDIT.] Each county auditor shall determine a homestead credit 
  7.1   for each class 1a, 1b, 1c, and 2a homestead property within the 
  7.2   county equal to 0.4 0.5 percent of the market value of the 
  7.3   property.  The amount of homestead credit for a homestead may 
  7.4   not exceed $304 $380 and is reduced by .09 0.25 percent of the 
  7.5   market value in excess of $76,000.  In the case of an 
  7.6   agricultural or resort homestead, only the market value of the 
  7.7   house, garage, and immediately surrounding one acre of land is 
  7.8   eligible in determining the property's homestead credit. 
  7.9      [EFFECTIVE DATE.] This section is effective for taxes 
  7.10  levied in 2002, payable in 2003 and thereafter.