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Minnesota Legislature

Office of the Revisor of Statutes

Key: (1) language to be deleted (2) new language




                         Laws of Minnesota 1983 

                          CHAPTER 2--S.F.No. 41
           An act relating to public finance; delaying the 
          effective date of the requirement that certain 
          securities be in registered form; authorizing Ramsey 
          County to issue bonds or levy taxes to finance the 
          installation or improvement of heating, cooling, and 
          domestic hot water systems; amending Minnesota 
          Statutes 1982, sections 290.09, subdivision 3, as 
          amended; and 383A.411, by adding subdivisions; Laws 
          1982, Third Special Session chapter 1, article VII, 
          section 9; repealing Minnesota Statutes 1982, section 
          383A.411, subdivisions 1, 2, and 3. 
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
    Section 1.  Minnesota Statutes 1982, section 290.09, 
subdivision 3, as amended by Laws 1982, Third Special Session 
chapter 1, article 7, section 1, is amended to read: 
    Subd. 3.  [INTEREST.] (a) All interest paid or accrued 
within the taxable year on indebtedness, except as hereinafter 
provided. 
    (b) Interest paid or accrued within the taxable year on 
indebtedness incurred or continued to purchase or carry 
obligations or securities the income from which is excludable 
from gross income under sections 290.01, subdivisions 20 to 20f 
or 290.08, or shares of a regulated investment company which 
during the taxable year of the holder thereof distributes 
Minnesota exempt-interest dividends as defined in section 
290.01, subdivision 27, or on indebtedness described in section 
264(a)(2) and (3), (b) and (c) (relating to life insurance) of 
the Internal Revenue Code of 1954, as amended through December 
1, 1982 shall not be allowed as a deduction.  
    (c) If personal property or educational services are 
purchased under a contract the provisions of section 163(b) of 
the Internal Revenue Code of 1954, as amended through December 
1, 1982 shall apply. 
    (d) A cash basis taxpayer may elect to deduct interest as 
it accrues on a reverse mortgage loan as defined in section 
47.58, subdivision 1, rather than when it is actually paid.  
This election must be made, if at all, in the first taxable year 
in which it is available to the cash basis taxpayer and, if 
made, shall be binding on the taxpayer for each subsequent 
taxable year until maturity of the loan. 
    (e) In the case of a taxpayer other than a corporation, the 
amount of interest on investment indebtedness allowable as a 
deduction shall be allowed and limited as set forth in section 
163(d) of the Internal Revenue Code of 1954, as amended through 
December 1, 1982.  The limitation prescribed in section 
163(d)(1)(A) for married individuals who file separate returns 
shall also apply to married individuals who file separately on 
one return.  
    (f) A taxpayer may not deduct interest on indebtedness 
incurred or continued to purchase or carry obligations or 
shares, or to make deposits or other investments, the interest 
on which is described in section 116(c) of the Internal Revenue 
Code of 1954, as amended through December 1, 1982 to the extent 
such interest is excludable from gross income under section 116 
of the Internal Revenue Code of 1954 as amended through December 
1, 1982.  Interest and carrying costs in the case of straddles 
shall be treated as provided in section 263(g) of the Internal 
Revenue Code of 1954, as amended through December 1, 1982.  The 
deduction of original issue discount shall be allowed as 
provided in section 163(e) of the Internal Revenue Code of 1954, 
as amended through December 1, 1982.  
     (g) No deduction shall be allowed for interest on any 
registration-required obligation unless the obligation is in 
registered form as provided in section 163(f) of the Internal 
Revenue Code of 1954, as amended through December 1, 1982 
January 15, 1983. 
    Sec. 2.  Laws 1982, Third Special Session chapter 1, 
article 7, section 9, is amended to read: 
    Sec. 9.  [EFFECTIVE DATE.] 
    Section 1 is effective for taxable years beginning after 
December 31, 1982, except the provisions relating to original 
issue discount are effective at the same time as the provision 
became effective for federal tax purposes and the provisions 
relating to registration-required obligations are effective at 
the same time that section 306(b)(2) of Public Law Number 97-448 
is effective for federal tax purposes.  Sections 2 and 4 to 8 
are effective at the same time in 1982 as the provisions become 
effective for federal income tax purposes.  Section 3 is 
effective for taxable years beginning after December 31, 1982 
with respect to construction that commences after that date. 
    Sec. 3.  Minnesota Statutes 1982, section 383A.411, is 
amended by adding a subdivision to read: 
    Subd. 4.  Ramsey county may issue and sell from time to 
time general obligation bonds of the county in an aggregate 
principal amount not to exceed $5,000,000 to finance the 
construction, installation, modification, or improvement of 
heating, cooling, and domestic hot water systems serving 
buildings owned in whole or part, operated, or maintained by the 
county or the Ramsey county medical center commission.  The 
county shall pledge its full faith and credit and taxing powers 
for the payment of the bonds.  Except as provided in this 
section, the bonds shall be issued in accordance with Minnesota 
Statutes, chapter 475.  The bonds may be issued and sold without 
submitting the question of the issuance of the bonds to a vote 
by the people.  The bonds shall be in a form and bear interest 
at the rate that the county prescribes and shall be sold by the 
county to the bidder with the most favorable bid, after notice 
of the time and place for the receiving of the bids has been 
published according to law.  The bonds shall not be included in 
computing the net debt of the county under any law, and the 
taxes required for payment of the bonds and interest on them 
shall not be subject to any limitation provided by other law.  
    Sec. 4.  Minnesota Statutes 1982, section 383A.411, is 
amended by adding a subdivision to read: 
    Subd. 5.  In substitution of, but not in addition to, 
powers granted to Ramsey county in subdivision 4, Ramsey county 
may levy and collect a tax, not to exceed the lesser of 
$5,000,000 or two mills, upon all taxable property in Ramsey 
county to finance the construction, installation, modification, 
or improvement of heating, cooling, and domestic hot water 
systems serving buildings owned in whole or part, operated, or 
maintained by the county or Ramsey county medical center 
commission.  A levy made pursuant to this subdivision shall not 
be subject to any limitation provided by other law.  
     Sec. 5.  Minnesota Statutes 1982, section 383A.411, is 
amended by adding a subdivision to read: 
     Subd. 6.  The bonds described in subdivision 4 may not be 
issued and the tax described in subdivision 5 may not be levied 
until construction is commenced on a district heating system in 
St. Paul which is designed for heating or cooling or domestic 
hot water service to one or more buildings owned in whole or 
part, operated, or maintained by the county or the Ramsey county 
medical center commission.  
    Sec. 6.  [REPEALER.] 
    Minnesota Statutes 1982, section 383A.411, subdivisions 1, 
2, and 3 are repealed.  
    Sec. 7.  [EFFECTIVE DATE.] 
    Sections 1 and 2 are effective December 31, 1982.  Sections 
3, 4, 5, and 6 are effective the day after compliance with 
Minnesota Statutes, section 645.021, subdivision 3, by the 
governing body of Ramsey county.  
    Approved February 11, 1983