Minnesota Legislature
Office of the Revisor of Statutes
Minnesota Session Laws - 1986, 1st Special Session
Key: (1) language to be deleted (2) new language
Laws of Minnesota 1986, First Special Session
CHAPTER 1-H.F.No. 1
An act relating to government in this state; updating
the income tax law to conform with federal tax law
changes; making administrative and technical changes
in the income tax law; providing for direct payments
of fire and police state aids; requiring a one-year
sales ratio study; changing dates for payments of
certain state aids; delaying date for payment of
second half taxes on agricultural property;
authorizing reciprocal agreements with other states
regarding interstate vehicles; requiring a report on
the sales ratio study; eliminating a durational
restriction on a special levy in Clearwater county;
providing for delay of certain aid payments and
altering computations; adjusting the computation and
payment of local government aids; expanding tax
clearance authority; expanding tax collection
authority of the department of revenue; authorizing
the department to file tax liens against homestead
property; increasing the rate of interest to be paid
on tax refunds; changing times for payment of certain
taxes on liquor, cigarettes, tobacco products, and
insurance premiums; imposing certain requirements on
liquor wholesalers; altering enterprise zone
provisions; providing for certain examinations;
delaying transfer of motor vehicle excise taxes;
reinstating the bottle tax; reducing the ethanol
credit and providing payments to ethanol producers;
adjusting income and asset criteria for recipients of
medical assistance; repealing the provision for
suspension of income tax indexing; making technical
changes in property tax and other miscellaneous tax
laws; transferring certain positions within the
department of natural resources; establishing
priorities for expenditure of additional revenues;
reducing certain appropriations for education with
certain conditions; adjusting complements; setting the
foundation formula allowance and the amount to be
raised by the basic maintenance mill rate; altering
certain education aid and levy formulas and
requirements; authorizing levies in certain school
districts; making changes in certain pension,
retirement, and social security provisions; limiting
eligibility for school bus driver endorsements;
providing for insurance coverage, expense allowances,
board duties, office location, class days, building
construction, approval on certain capital improvements
involving certain post-secondary education systems;
providing for community emergency response hazardous
substance protection; transferring certain funds
between agencies; requiring certain studies and
reports; imposing penalties; appropriating money;
amending Minnesota Statutes 1984, sections 15.38,
subdivision 3; 60A.15, subdivision 2; 60A.17, by
adding a subdivision; 69.021, subdivisions 4, 5, 7,
and 9; 69.031, subdivision 3; 69.54; 82.22,
subdivision 3; 82.27, by adding a subdivision;
121.901, subdivision 2; 123.71, subdivision 1;
124.195, subdivisions 3, 5, and by adding a
subdivision; 124.32, subdivision 1c; 124.573,
subdivision 3; 124.71, subdivision 2; 136.14; 148.10,
by adding a subdivision; 150A.08, by adding a
subdivision; 162.06, subdivision 1; 162.12,
subdivision 1; 270.12, subdivision 2; 270.69, by
adding a subdivision; 270.72, subdivisions 1, 2, and
3; 270A.03, subdivision 5; 273.072, subdivision 1;
273.1391, subdivision 3; 275.125, subdivision 9, and
by adding a subdivision; 276.09; 276.10; 276.11;
278.03; 279.01, as amended; 290.067, subdivision 2;
290.281, subdivision 5; 290.34, subdivision 2; 290.36;
290.50, subdivision 3; 290.53, subdivision 2; 290.56,
subdivision 3; 290.61; 290A.03, subdivision 8; 296.16,
subdivision 1; 296.17, subdivision 6, and by adding a
subdivision; 297.07, subdivisions 1 and 4; 297.23,
subdivision 1; 297.35, subdivisions 5 and 8; 297A.27,
by adding a subdivision; 297A.43; 297B.09, subdivision
2; 298.24, subdivision 1; 299F.21; 326.20, by adding a
subdivision; 364.09; and 477A.015; Minnesota Statutes
1985 Supplement, sections 15A.081, subdivision 8;
16A.15, subdivisions 1 and 6; 16A.1541; 60A.17,
subdivision 1a; 69.031, subdivision 1; 116C.63,
subdivision 4; 121.904, subdivision 4c; 124.155,
subdivision 2; 124.17, subdivision 1a; 124.195,
subdivision 11; 124.2131, subdivision 3; 124.2161,
subdivision 6; 124.2162, subdivision 2; 124.2163,
subdivision 2; 124.225, subdivisions 7b and 10;
124.245, subdivisions 1 and 3; 124.271, subdivision
2b; 124.573, subdivision 2; 124A.02, subdivisions 9
and 15; 124A.03, subdivision 1a; 129B.38, subdivision
1; 136C.07, subdivision 5a; 136C.35; 147.021, by
adding a subdivision; 256B.06, subdivision 1; 270.063;
270.69, subdivisions 2, 3, and 4; 270.76; 270.77;
273.11, subdivision 8; 273.124, subdivisions 6, 8, 9,
10, 11, and by adding a subdivision; 273.13,
subdivisions 15a, 26, 28, and 30; 273.1314,
subdivisions 6 and 16a, as amended; 273.136; 273.42,
subdivision 2; 274.19, subdivisions 1 and 8; 275.125,
subdivisions 8, 11a, and 11c; 278.05, subdivision 5;
279.06; 287.12; 287.29, subdivision 1; 290.01,
subdivision 20; 290.06, subdivision 3g; 290.068,
subdivision 3; 290.079, subdivision 1; 290.089,
subdivision 3; 290.09, subdivision 7; 290.091,
subdivision 2; 290.095, subdivisions 9 and 11; 290.10;
290.12, subdivision 2; 290.13, subdivision 1; 290.132,
subdivision 1; 290.14; 290.16, subdivisions 7 and 15;
290.17, subdivision 2; 290.21, subdivisions 4 and 8;
290.41, subdivision 1; 290.92, subdivision 2a; 290.93,
subdivision 10; 290A.03, subdivisions 3, 6, and 13;
296.02, subdivision 7; 296.22, subdivision 13; 297.35,
subdivision 1; 297C.02, by adding a subdivision;
297C.03, subdivision 1; 297C.04; 297C.05, subdivision
2; 298.28, subdivision 1; 354.43, subdivision 3;
354A.12, subdivision 2; 355.208; 355.287; 355.46,
subdivision 3; 477A.011, subdivisions 10 and 14;
477A.012; 477A.013; and 609.101; Laws 1985, chapter
289, section 5, subdivision 2; and section 7; Laws
1985, First Special Session chapter 12, article 1,
section 36, subdivision 3; article 2, section 15,
subdivision 2; article 3, section 28, subdivisions 9
and 10; article 4, section 11, subdivision 6; article
5, section 10, subdivisions 2 and 4; article 6,
section 28, subdivisions 11, 16, 17, and 20, article
8, section 60, subdivisions 1 and 4; section 62,
subdivisions 2, 3, 4, 6, 8, 9, 12, 13, 14, 15, and 17;
section 63, subdivisions 2 and 3; section 64,
subdivision 2; article 9, section 3, subdivisions 2
and 3; article 11, section 21, subdivision 3; chapter
14, article 11, section 13; proposing coding for new
law in Minnesota Statutes, chapters 41A; 135A; 256;
270; 276; 297A; and 299F; 458; repealing Minnesota
Statutes 1984, sections 69.031, subdivision 4; 121.495;
124A.031, subdivision 2; 136.063; 270.72, subdivision
5; 275.125, subdivision 16; 290.06, subdivision 15;
290.39, subdivision 1a; and 290A.04, subdivision 2f;
Minnesota Statutes 1985 Supplement, sections 16A.154;
124.245, subdivisions 2 and 5; 129B.38; 275.125,
subdivision 11b; and 290.06, subdivision 2f; Laws
1985, First Special Session chapter 14, article 21,
sections 16 and 17.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
ARTICLE 1
INCOME TAX UPDATE
Section 1. Minnesota Statutes 1985 Supplement, section
290.01, subdivision 20, is amended to read:
Subd. 20. [GROSS INCOME.] Except as otherwise provided in
this chapter, the term "gross income," as applied to
corporations includes every kind of compensation for labor or
personal services of every kind from any private or public
employment, office, position or services; income derived from
the ownership or use of property; gains or profits derived from
every kind of disposition of, or every kind of dealing in,
property; income derived from the transaction of any trade or
business; and income derived from any source.
The term "gross income" in its application to individuals,
estates, and trusts shall mean the adjusted gross income as
defined in the Internal Revenue Code of 1954, as amended through
the date specified herein for the applicable taxable year, with
the modifications specified in this subdivision and in
subdivisions 20a to 20f. For estates and trusts the adjusted
gross income shall be their federal taxable income as defined in
the Internal Revenue Code of 1954, as amended through the date
specified herein for the applicable taxable year, with the
modifications specified in this subdivision and in subdivisions
20a to 20f.
(i) The Internal Revenue Code of 1954, as amended through
December 31, 1980, and as amended by sections 302(b) and 501 to
509 of Public Law Number 97-34, shall be in effect for taxable
years beginning after December 31, 1980 including the provisions
of section 404 (relating to partial exclusions of dividends and
interest received by individuals) of the Crude Oil Windfall
Profit Tax Act of 1980, Public Law Number 96-223. The
provisions of Public Law Number 96-471 (relating to installment
sales) sections 122, 123, 126, 201, 202, 203, 204, 211, 213,
214, 251, 261, 264, 265, 311(g)(3), 313, 314(a)(1), 321(a), 501
to 507, 811, and 812 of the Economic Recovery Tax Act of 1981,
Public Law Number 97-34 and section 113 of Public Law Number
97-119 shall be effective at the same time that they become
effective for federal income tax purposes.
(ii) The Internal Revenue Code of 1954, as amended through
December 31, 1981, shall be in effect for taxable years
beginning after December 31, 1981. The provisions of sections
205(a), 214 to 222, 231, 232, 236, 247, 251, 252, 253, 265, 266,
285, 288, and 335 of the Tax Equity and Fiscal Responsibility
Act of 1982, Public Law Number 97-248, section 6(b)(2) and (3)
of the Subchapter S Revision Act of 1982, Public Law Number
97-354, section 517 of Public Law Number 97-424, sections 101(c)
and (d), 102(a), (aa), (f)(4), (g), (j), (l), 103(c), 104(b)(3),
105, 305(d), 306(a)(9) of Public Law Number 97-448, and sections
101 and 102 of Public Law Number 97-473 shall be effective at
the same time that they become effective for federal income tax
purposes. The Payment-in-Kind Tax Treatment Act of 1983, Public
Law Number 98-4, shall be effective at the same time that it
becomes effective for federal income tax purposes.
(iii) The Internal Revenue Code of 1954, as amended through
January 15, 1983, shall be in effect for taxable years beginning
after December 31, 1982.
(iv) The Internal Revenue Code of 1954, as amended through
December 31, 1983, shall be in effect for taxable years
beginning after December 31, 1983. The provisions of sections
13, 17, 25(b), 31, 32, 41 to 43, 52, 55, 56, 71 to 74, 77, 81,
82, 91, 92, 94, 101 to 103, 105 to 108, 111 to 113, 147(c), 171,
172, 174, 175, 179(a), 221, 223, 224, 421(b), 432, 481, 491,
512, 522 to 524, 554 to 557, 561, 611(a), 621 to 623, 626 to
628, 711(c), 712(d), 713(b), (e), (g), and (h), 721(a), (b),
(d), (g), (i), (o), (p), (r), (t), and (w), 722(e), 1001, 1026,
1061 to 1064, 1066, 1076, 1078, and 2638(b) of the Deficit
Reduction Act of 1984, Public Law Number 98-369, and section 1
of Public Law Number 98-611 shall be effective at the same time
that they become effective for federal income tax purposes.
(v) The Internal Revenue Code of 1954, as amended through
May 25, 1985, shall be in effect for taxable years beginning
after December 31, 1984. The provisions of sections 101, 102,
103, 201, and 202 of Public Law Number 99-121 shall be effective
at the same time that they become effective for federal income
tax purposes.
(vi) The Internal Revenue Code of 1954, as amended through
December 31, 1985, shall be in effect for taxable years
beginning after December 31, 1985.
References to the Internal Revenue Code of 1954 in
subdivisions 20a, 20b, 20e, and 20f mean the code in effect for
the purpose of defining gross income for the applicable taxable
year.
Sec. 2. Minnesota Statutes 1985 Supplement, section
290.079, subdivision 1, is amended to read:
Subdivision 1. [AMOUNT CONSTITUTING INTEREST.] For
purposes of this chapter, in the case of any contract for the
sale or exchange of property there shall be treated as interest
that part of a payment to which section 483 of the Internal
Revenue Code of 1954, as amended through December 31, 1984 1985,
applies. The treatment of loans with below-market interest
rates shall be the same as is provided in section 7872 of the
Internal Revenue Code of 1954, as amended through December 31,
1984 1985.
Sec. 3. Minnesota Statutes 1985 Supplement, section
290.09, subdivision 7, is amended to read:
Subd. 7. [DEPRECIATION.] (A) [CUMULATIVE DEPRECIATION.]
(a) There shall be allowed as a depreciation deduction a
reasonable allowance for the exhaustion, wear and tear
(including a reasonable allowance for obsolescence):
(1) of property used in the trade or business, or
(2) of property held for the production of income.
In the case of recovery property as provided in clause (c),
the deduction allowable under clause (c) shall be deemed to
constitute the reasonable allowance provided by this
subdivision, except for the provisions of Part (B) relating to
first year depreciation and except with respect to that portion
of the basis of the property to which section 167(k) of the
Internal Revenue Code of 1954, as amended through December 31,
1984 1985, applies.
(b) The term "reasonable allowance" as used in clause (a)
shall include (but shall not be limited to) an allowance
computed in accordance with regulations prescribed by the
commissioner, under any of the following methods:
(1) the straight line method.
(2) the declining balance method, using a rate not
exceeding twice the rate which would have been used had the
annual allowance been computed under the method described in
paragraph (1).
(3) the sum of the years-digits method, and
(4) any other consistent method productive of an annual
allowance, which, when added to all allowances for the period
commencing with the taxpayer's use of the property and including
the taxable year, does not, during the first two-thirds of the
useful life of the property, exceed the total of such allowances
which would have been used had such allowances been computed
under the method described in (2). Nothing in this clause shall
be construed to limit or reduce an allowance otherwise allowable
under clause (a).
(c) For purposes of this subdivision "reasonable allowance"
shall be the accelerated cost recovery system provisions of
section 168 of the Internal Revenue Code of 1954, as amended
through December 31, 1984 1985, except as provided in this
subdivision. In the case of recovery property within the
meaning of section 168 of the Internal Revenue Code of 1954, as
amended through December 31, 1984 1985, the term "reasonable
allowance" as used in clause (a) shall mean 85 percent of the
deduction allowed pursuant to section 168 of the Internal
Revenue Code of 1954 for property placed in service after
December 31, 1980 and for taxable years beginning before January
1, 1982.
For taxable years beginning after December 31, 1981 the
term reasonable allowance as used in clause (a) shall mean the
following percent of the deduction allowed pursuant to section
168 of the Internal Revenue Code of 1954, as amended through
December 31, 1984 1985:
(1) For 3, 5 and 10 year property and for 15 year public
utility property the allowable percentage is 83 percent and 80
percent for taxable years beginning after December 31, 1982.
(2) For 15 or, 18, or 19 year real property the allowable
percentage is 60 percent.
For property placed in service after December 31, 1980 the
term "reasonable allowance" as used in clause (a) shall mean 100
percent of the deduction allowed pursuant to section 168 of the
Internal Revenue Code of 1954 where the taxpayer uses for
federal income tax purposes the straight line method provided in
section 168(b)(3), (f)(12), or (j)(1) or a method provided in
section 168(e)(2) of the Internal Revenue Code of 1954, as
amended through December 31, 1984 1985. For property placed in
service after December 31, 1980 and for which the full amount of
the deduction allowed under section 168 of the Internal Revenue
Code of 1954, as amended through December 31, 1984 1985 has been
allowed, the remaining depreciable basis in those assets for
Minnesota purposes shall be a depreciation allowance computed by
using the straight line method over the following number of
years:
(1) 3 year property - 1 year.
(2) 5 year property - 2 years.
(3) 10 year property - 5 years.
(4) All 15 and, 18, and 19 year property - 7 years.
When an asset is exchanged for another asset including an
involuntary conversion and under the provision of the Internal
Revenue Code gain is not recognized in whole or in part on the
exchange of the first asset, the basis of the second asset shall
be the same as its federal basis provided that the difference in
basis due to the limitations provided in this clause can be
written off as provided in the preceding sentence.
After the full amount of the allowable deduction for that
property under the provision of section 168 of the Internal
Revenue Code of 1954, as amended through December 31, 1984 1985,
has been obtained, the remaining depreciable basis in those
assets for Minnesota purposes that shall be allowed as a
depreciation allowance as provided above shall include the
amount of any basis reduction made for federal purposes under
section 48(q) of the Internal Revenue Code, as amended through
December 31, 1984 1985, to reflect the investment tax credit.
No amount shall be allowed as a deduction under section 196 of
the Internal Revenue Code of 1954, as amended through December
31, 1984 1985.
The provisions of section 168(i)(4) of the Internal Revenue
Code of 1954, as amended through December 31, 1984 1985 shall
apply to restrict research credit carrybacks and net operating
loss carrybacks which are allocable to elected qualified leased
property, notwithstanding section 290.068, subdivision 3, or
290.095, subdivision 3.
The provisions of section 280F of the Internal Revenue Code
of 1954, as amended through May 25 December 31, 1985, shall
apply to limit the depreciation deductions, (including the first
year depreciation deduction provided in paragraph (B)), for
luxury automobiles and other property as provided in that
section, and provided that if that section applies, the taxpayer
shall be allowed to deduct the same amount of depreciation as
was deducted for federal income tax purposes.
(d) Paragraphs (2), (3), and (4) of clause (b) shall apply
only in the case of property (other than intangible property)
described in clause (a) with a useful life of three years or
more.
(1) the construction, reconstruction, or erection of which
is completed after December 31, 1958, and then only to that
portion of the basis which is properly attributable to such
construction, reconstruction, or erection after December 31,
1958, or
(2) acquired after December 31, 1958, if the original use
of such property commenced with the taxpayer and commences after
such date.
(e) Where, under rules prescribed by the commissioner, the
taxpayer and the commissioner have, after June 30, 1959, entered
into an agreement in writing specifically dealing with the
useful life and rate of depreciation of any property, the rate
so agreed upon shall be binding on both the taxpayer and the
commissioner in the absence of facts or circumstances not taken
into consideration in the adoption of such agreement. The
responsibility of establishing the existence of such facts and
circumstances shall rest with the party initiating the
modification. Any change in the agreed rate and useful life
specified in the agreement shall not be effective for taxable
years before the taxable year in which notice in writing by
certified mail is served by the party to the agreement
initiating such change. This clause shall not apply with
respect to recovery property as defined in clause (c).
(f) In the absence of an agreement under clause (e)
containing a provision to the contrary, a taxpayer may at any
time elect in accordance with rules prescribed by the
commissioner to change from the method of depreciation
prescribed in clause (b)(2) to the method described in clause
(b)(1).
(g) The basis on which exhaustion, wear and tear, and
obsolescence are to be allowed in respect of any property shall
be the adjusted basis provided in this chapter for the purpose
of determining the gain on the sale or other disposition of such
property.
(B) [FIRST YEAR DEPRECIATION.] The term "reasonable
allowance" as used in this subdivision may, at the election of
the taxpayer, include an amount as provided under section 179 of
the Internal Revenue Code of 1954, as amended through December
31, 1984 1985.
Sec. 4. Minnesota Statutes 1985 Supplement, 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 adjusted gross income as defined
in the Internal Revenue Code;
(2) the taxpayer's federal tax preference items; less the
sum of
(i) interest income as defined in section 290.01,
subdivision 20b, clause (1); and
(ii) the amount of interest paid or accrued within the
taxable year on indebtedness to the extent that the amount does
not exceed qualified net investment income, as defined in
section 55(e)(5) of the Internal Revenue Code. Interest does
not include amounts deducted in computing federal adjusted gross
income or amounts that are not allowable under section 55(e)(8)
of the Internal Revenue Code.
In the case of an estate or trust, adjusted gross income
must be modified as provided in section 55(e)(6)(B) of the
Internal Revenue Code.
(b) "Federal tax preference items" means items as defined
in sections 57, 58, and 443(d) of the Internal Revenue Code,
modified as follows:
(1) The capital gain preference item shall be reduced where
the gain would be modified because some or all of the assets
have a higher basis for Minnesota purposes than for federal
purposes.
(2) In the case of a nonresident individual, or an estate
or trust, with a net operating loss that is a larger amount for
Minnesota than for federal, the capital gain preference item
shall be reduced to the extent it was reduced in the allowance
of the net operating loss.
(3) Federal preference items from the business of mining or
producing iron ore and other ores which are subject to the
occupation tax and exempt from taxation under section 290.05,
subdivision 1, shall not be a preference item for Minnesota.
(4) Other federal preference items to the extent not
allowed in the computation of Minnesota gross income, as
determined by the commissioner, are not preference items for
Minnesota.
(c) "Internal Revenue Code" means the Internal Revenue Code
of 1954, as amended through December 31, 1984 1985.
(d) "Regular tax" means the tax that would be imposed under
this chapter (without regard to this section), reduced by the
sum of the nonrefundable credits allowed under this chapter.
Sec. 5. Minnesota Statutes 1985 Supplement, section
290.132, subdivision 1, is amended to read:
Subdivision 1. [TAXABILITY OF CORPORATION ON
DISTRIBUTION.] No gain or loss shall be recognized to a
corporation on the distribution, with respect to its stock as
provided in section 311 of the Internal Revenue Code of 1954, as
amended through December 31, 1984 1985.
The effect on earnings and profits shall be determined
according to the provisions of section 312 of the Internal
Revenue Code of 1954, as amended through December 31, 1984 1985.
However, when determining earnings and profits in section 312(f)
and (g), the date December 31, 1932 shall be substituted for
February 28, 1913, and January 1, 1933 shall be substituted for
March 1, 1913.
Sec. 6. Minnesota Statutes 1985 Supplement, section
290.16, subdivision 7, is amended to read:
Subd. 7. [BONDS, OTHER EVIDENCES OF INDEBTEDNESS.] For the
purpose of this section, the treatment of bonds and other debt
instruments shall be governed by the provisions of sections 1271
to 1288 of the Internal Revenue Code of 1954, as amended through
December 31, 1984 1985.
Sec. 7. Minnesota Statutes 1985 Supplement, section
290.16, subdivision 15, is amended to read:
Subd. 15. [GAIN FROM DISPOSITIONS OF CERTAIN DEPRECIABLE
PROPERTY.] For purposes of this subdivision "depreciable
property" shall mean "Section 1245 property" or "Section 1245
recovery property" as those phrases are defined in section
1245(a) (3) or (5) of the Internal Revenue Code of 1954, as
amended through December 31, 1984 1985.
In determining net income of any corporate taxpayer, the
gain realized from the disposition of "depreciable property"
shall be treated in the same manner as is provided by section
1245 of the Internal Revenue Code of 1954, as amended through
December 31, 1984 1985 and regulations adopted pursuant thereto
except that the determination shall be made using the basis
computed under this chapter.
Sec. 8. Minnesota Statutes 1985 Supplement, section
290A.03, subdivision 3, is amended to read:
Subd. 3. [INCOME.] (1) "Income" means the sum of the
following:
(a) federal adjusted gross income as defined in the
Internal Revenue Code of 1954 as amended through May 25 December
31, 1985; and
(b) the sum of the following amounts to the extent not
included in clause (a):
(i) additions to federal adjusted gross income as provided
in section 290.01, subdivision 20a, clauses (1), (2), (3), and
(4);
(ii) all nontaxable income;
(iii) recognized net long-term capital gains;
(iv) dividends excluded from federal adjusted gross income
under section 116 of the Internal Revenue Code of 1954;
(v) cash public assistance and relief;
(vi) 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;
(vii) nontaxable interest received from the state or
federal government or any instrumentality or political
subdivision thereof;
(viii) workers' compensation;
(ix) unemployment benefits;
(x) nontaxable strike benefits;
(xi) 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;
(xii) the ordinary income portion of a lump sum
distribution under section 402(e) of the Internal Revenue Code
of 1954; and
(xiii) 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 of 1954; or deferred
compensation plan under section 457 of the Internal Revenue Code
of 1954.
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.
(2) "Income" does not include
(a) amounts excluded pursuant to the Internal Revenue Code,
sections 101(a), 102, 117, and 121;
(b) 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;
(c) surplus food or other relief in kind supplied by a
governmental agency;
(d) relief granted under this chapter;
(e) child support payments received under a temporary or
final decree of dissolution or legal separation; or
(f) the first $2,000 of household income if the claimant
was disabled on or before June 1 or attained the age of 65 prior
to June 1 of the year following the year for which the taxes
were levied or in which the rent was paid.
Sec. 9. [INSTRUCTIONS TO REVISOR.]
In the next edition of Minnesota Statutes, the revisor of
statutes shall substitute the phrase "Internal Revenue Code of
1954, as amended through December 31, 1985" for the words
"Internal Revenue Code of 1954, as amended through December 31,
1984" or "Internal Revenue Code of 1954, as amended through May
25, 1985" wherever the phrase occurs in chapter 290, except
sections 290.01, subdivision 20, and 290.068.
Sec. 10. [EFFECTIVE DATE.]
Section 1 is effective for taxable years beginning after
December 31, 1985, except as otherwise provided in clause (v) of
that section. Sections 2 to 7 are effective at the same time as
the federal changes are effective in 1985, as provided in Public
Law Number 99-121. Section 8 is effective for claims based on
rent paid in 1985 and thereafter and property taxes payable in
1986 and thereafter. Section 9 is effective for taxable years
beginning after December 31, 1985.
ARTICLE 2
INCOME TAX ADMINISTRATIVE
Section 1. Minnesota Statutes 1985 Supplement, section
290.12, subdivision 2, is amended to read:
Subd. 2. [ADJUSTMENTS.] In computing the amount of gain or
loss under subdivision 1 proper adjustment shall be made for any
expenditure, receipt, loss, or other item properly chargeable to
capital account by the taxpayer during his ownership thereof the
basis of the property is its adjusted basis for federal income
tax purposes, except as otherwise provided in this chapter. In
addition to other adjustments provided in this chapter, the
adjusted basis of property for federal income tax purposes shall
be increased by the amount of accelerated cost recovery system
depreciation which was allowed for federal income tax purposes
but not allowed for Minnesota income tax purposes under sections
290.01, subdivision 20f or 290.09, subdivision 7, paragraph
(A)(c). The basis shall be diminished by the amount of the
deductions for exhaustion, wear and tear, obsolescence,
amortization, depletion, and the allowance for amortization of
bond premium if an election to amortize was made in accordance
with section 290.09, subdivision 13, which could, during the
period of his ownership thereof, have been deducted by the
taxpayer under this chapter in respect of such property. In
addition, if the property was acquired before January 1, 1933,
the basis, if other than the fair market value as of such date,
shall be diminished by the amount of exhaustion, wear and tear,
obsolescence, amortization, or depletion actually sustained
before such date. In respect of any period since December 31,
1932, during which property was held by a person or an
organization not subject to income taxation under this chapter,
proper adjustment shall be made for exhaustion, wear and tear,
obsolescence, amortization, and depletion of such property to
the extent sustained. For the purpose of determining the amount
of these adjustments the taxpayer who sells or otherwise
disposes of property acquired by gift shall be treated as the
owner thereof from the time it was acquired by the last
preceding owner who did not acquire it by gift, and the taxpayer
who sells or otherwise disposes of property acquired by gift
through an inter vivos transfer in trust shall be treated as the
owner from the time it was acquired by the grantor.
No adjustment shall be made:
(1) for taxes or other carrying charges described in
section 290.10, clause (11), or
(2) for expenditures described in section 290.09,
subdivision 16 (relating to circulation expenditures), for which
deductions have been taken by the taxpayer in determining
taxable income for the taxable year or prior years the basis of
the property is its adjusted basis for federal income tax
purposes, except as otherwise provided in this chapter.
Sec. 2. Minnesota Statutes 1985 Supplement, section
290.17, subdivision 2, is amended to read:
Subd. 2. [OTHER TAXPAYERS.] In the case of an individual
who is not a full year resident, this subdivision applies to
determine what income is assignable to Minnesota for purposes of
determining the numerator of the fraction used in section
290.06, subdivision 2c. In the case of taxpayers not subject to
the provisions of subdivision 1, items of gross income shall be
assigned to this state or other states or countries in
accordance with the following principles:
(1)(a) The entire income of all resident or domestic
taxpayers from compensation for labor or personal services, or
from a business consisting principally of the performance of
personal or professional services, shall be assigned to this
state, and the income of nonresident taxpayers from such sources
shall be assigned to this state if, and to the extent that, the
labor or services are performed within it; all other income from
such sources shall be treated as income from sources without
this state.
(b) In the case of an individual who is a nonresident of
Minnesota and who is an athlete or entertainer, income from
compensation for labor or personal services performed within
this state shall be determined in the following manner.
(i) The amount of income to be assigned to Minnesota for an
individual who is a nonresident salaried athletic team employee
shall be determined by using a fraction in which the denominator
contains the total number of days in which the individual is
under a duty to perform for the employer, and the numerator is
the total number of those days spent in Minnesota. In order to
eliminate the need to file state or provincial income tax
returns in several states or provinces, Minnesota will exclude
from income any income assigned to Minnesota under the
provisions of this clause for a nonresident athlete who is
employed by an athletic team whose operations are not based in
this state and for a nonresident salaried entertainer who is
employed by an entertainment organization whose operations are
not based in this state if the state or province in which the
athletic team or entertainment organization is based provides a
similar income exclusion. If the state or province in which the
athletic team's or the entertainment organization's operations
are based does not have an income tax on an individual's
personal service income, it will be deemed that that state or
province has a similar income exclusion. As used in the
preceding sentence, the term "province" means a province of
Canada.
(ii) The amount of income to be assigned to Minnesota for
an individual who is a nonresident, and who is an athlete or
entertainer not listed in clause (i), or who is an entertainer,
for that person's athletic or entertainment performance in
Minnesota shall be determined by assigning to this state all
income from performances or athletic contests in this state.
(2) Income from the operation of a farm shall be assigned
to this state if the farm is located within this state and to
other states only if the farm is not located in this state.
Income from winnings on Minnesota pari-mutuel betting tickets
shall be assigned to this state. Income and gains received from
tangible property not employed in the business of the recipient
of such income or gains, and from tangible property employed in
the business of such recipient if such business consists
principally of the holding of such property and the collection
of the income and gains therefrom, shall be assigned to this
state if such property has a situs within it, and to other
states only if it has no situs in this state. Income or gains
from intangible personal property not employed in the business
of the recipient of such income or gains, and from intangible
personal property employed in the business of such recipient if
such business consists principally of the holding of such
property and the collection of the income and gains therefrom,
wherever held, whether in trust, or otherwise, shall be assigned
to this state if the recipient thereof is domiciled within this
state or is a resident trust or estate.
(3) Income derived from carrying on a trade or business,
including in the case of a business owned by natural persons the
income imputable to the owner for his services and the use of
his property therein, shall be assigned to this state if the
trade or business is conducted wholly within this state, and to
other states if conducted wholly without this state. This
provision shall not apply to business income subject to the
provisions of clause (1).
(4) When a trade or business is carried on partly within
and partly without this state, the entire income derived from
such trade or business, including income from intangible
property employed in such business and including, in the case of
a business owned by natural persons, the income imputable to the
owner for his services and the use of his property therein,
shall be governed, except as otherwise provided in sections
290.35 and 290.36, by the provisions of section 290.19,
notwithstanding any provisions of this subdivision to the
contrary. This shall not apply to business income subject to
the provisions of clause (1), nor shall it apply to income from
the operation of a farm which is subject to the provisions of
clause (2). For the purposes of this clause, a trade or
business located in Minnesota is carried on partly within and
partly without this state if tangible personal property is sold
by such trade or business and delivered or shipped to a
purchaser located outside the state of Minnesota.
If the trade or business carried on wholly or partly in
Minnesota is part of a unitary business, the entire income of
that unitary business shall be subject to apportionment under
section 290.19 except for business income subject to the
provisions of clause (1) and farm income subject to the
provisions of clause (2). The term "unitary business" shall
mean business activities or operations which are of mutual
benefit, dependent upon, or contributory to one another,
individually or as a group. Unity shall be presumed whenever
there is unity of ownership, operation, and use, evidenced by
centralized management or executive force, centralized
purchasing, advertising, accounting, or other controlled
interaction but the absence of these centralized activities will
not necessarily evidence a nonunitary business. Unity of
ownership will not be deemed to exist when a corporation is
involved unless that corporation is a member of a group of two
or more corporations more than 50 percent of the voting stock of
each member of the group is directly or indirectly owned by a
common owner or by common owners, either corporate or
noncorporate, or by one or more of the member corporations of
the group.
The entire income of a unitary business shall be subject to
apportionment as provided in section 290.19. None of the income
of a unitary business shall be considered as derived from any
particular source and none shall be allocated to any particular
place except as provided by the applicable apportionment formula.
In determining whether or not intangible property is
employed in a unitary business carried on partly within and
partly without this state so that income derived therefrom is
subject to apportionment under section 290.19 the following
rules and guidelines shall apply.
(a) Intangible property is employed in a business if the
business entity owning intangible property holds it as a means
of furthering the business operation of which a part is located
within the territorial confines of this state.
(b) Where a business operation conducted in Minnesota, is
owned by a business entity which carries on business activity
outside of the state different in kind from that conducted
within this state, and such other business is conducted entirely
outside the state, it will be presumed that the two business
operations are unitary in nature, interrelated, connected and
interdependent unless it can be shown to the contrary.
(5) For purposes of this section, amounts received by a
nonresident from the United States, its agencies or
instrumentalities, the Federal Reserve Bank, the state of
Minnesota or any of its political or governmental subdivisions,
or a Minnesota volunteer fireman's relief association, by way of
payment as a pension, public employee retirement benefit, or any
combination thereof, or as a retirement or survivor's benefit
made from a plan qualifying under section 401, 403, 404, 408, or
409 of the Internal Revenue Code of 1954, as amended through
December 31, 1984, are not considered income derived from
carrying on a trade or business or from performing personal or
professional services in Minnesota, and are not taxable under
this chapter.
(6) All other items of gross income shall be assigned to
the taxpayer's domicile.
Sec. 3. Minnesota Statutes 1985 Supplement, section
290.21, subdivision 4, is amended to read:
Subd. 4. (a) 85 percent of dividends received by a
corporation during the taxable year from another corporation,
when the corporate stock with respect to which dividends are
paid does not constitute the stock in trade of the taxpayer or
would not be included in the inventory of the taxpayer, or does
not constitute property held by the taxpayer primarily for sale
to customers in the ordinary course of his trade or business, or
when the trade or business of the taxpayer does not consist
principally of the holding of the stocks and the collection of
the income and gains therefrom. The remaining 15 percent shall
be allowed if the recipient owns 80 percent or more of all the
voting stock of the other corporation and the dividends were
paid from income arising out of business done in this state by
the corporation paying the dividends. If the dividends were
declared from income arising out of business done within and
without this state, then a proportion of the remainder shall be
allowed as a deduction. The proportion must be that which the
amount of the taxable net income of the corporation paying the
dividends assignable or allocable to this state bears to the
entire net income of the corporation. The amounts must be
determined by the returns under this chapter of the corporation
paying the dividends for the taxable year preceding their
distribution. The burden is on the taxpayer to show that the
amount of remainder claimed as a deduction has been received
from income arising out of business done in this state.
(b) If the trade or business of the taxpayer consists
principally of the holding of the stocks and the collection of
the income and gains therefrom, dividends received by a
corporation during the taxable year from another corporation, if
the recipient owns 80 percent or more of all the voting stock of
the other corporation, from income arising out of business done
in this state by the corporation paying the dividends. If the
dividends were declared from income arising out of business done
within and without this state, then a proportion of the
dividends shall be allowed as a deduction. The proportion must
be that which the amount of the taxable net income of the
corporation paying the dividends assignable or allocable to this
state bears to the entire net income of the corporation. The
amounts must be determined by the returns under this chapter of
the corporation paying the dividends for the taxable year
preceding their distribution. The burden is on the taxpayer to
show that the amount of dividends claimed as a deduction has
been received from income arising out of business done in this
state.
(c) The dividend deduction provided in this subdivision
shall be allowed only with respect to dividends that are
included in a corporation's Minnesota taxable net income for the
taxable year.
The dividend deduction provided in this subdivision does
not apply to a dividend from a corporation which, for the
taxable year of the corporation in which the distribution is
made or for the next preceding taxable year of the corporation,
is a corporation exempt from tax under section 501 of the
Internal Revenue Code of 1954, as amended through December 31,
1984.
The dividend deduction provided in this subdivision applies
to the amount of regulated investment company dividends only to
the extent determined under section 854(b) of the Internal
Revenue Code of 1954, as amended through December 31, 1984.
The dividend deduction provided in this subdivision shall
not be allowed with respect to any dividend for which a
deduction is not allowed under the provisions of section 246(c)
of the Internal Revenue Code of 1954, as amended through
December 31, 1984.
(d) If dividends received by a corporation that does not
have nexus with Minnesota under the provisions of Public Law
Number 86-272 are included as income on the return of an
affiliated corporation permitted or required to file a combined
report under section 290.34, subdivision 2, then for purposes of
this subdivision the determination as to whether the trade or
business of the corporation consists principally of the holding
of stocks and the collection of income and gains therefrom shall
be made with reference to the trade or business of the
affiliated corporation having a nexus with Minnesota.
(e) Dividends received by a corporation from another
corporation which is organized under the laws of a foreign
country or a political subdivision of a foreign country, if the
dividends are paid from income arising from sources without the
United States, the commonwealth of Puerto Rico, and the
possessions of the United States. The deduction provided by
this clause does not apply if the corporate stock with respect
to which dividends are paid constitutes the stock in trade of
the taxpayer, or would be included in the inventory of the
taxpayer, or constitutes property held by the taxpayer primarily
for sale to customers in the ordinary course of the taxpayer's
trade or business, or if the trade or business of the taxpayer
consists principally of the holding of stocks and the collection
of the income or gains therefrom. No dividend may be deducted
under this clause if it is deducted under clause (a).
Sec. 4. Minnesota Statutes 1984, section 290.36, is
amended to read:
290.36 [INVESTMENT COMPANIES; REPORT OF NET INCOME;
COMPUTATION OF AMOUNT OF INCOME ALLOCABLE TO STATE.]
The taxable net income of investment companies shall be
computed and be exclusively as follows:
Each investment company transacting business as such in
this state shall report to the commissioner the net income
returned by the company for the taxable year to the United
States under the provisions of the Internal Revenue Code of
1954, as amended through December 31, 1983, less the credits
provided therein and subject to the adjustments required by this
chapter. The commissioner shall compute therefrom the taxable
net income of the investment company by assigning to this state
that proportion of such net income, less such credits which the
aggregate of the gross payments collected by the company during
the taxable year from old and new business upon investment
contracts issued by the company and held by residents of this
state, bears to the total amount of the gross payments collected
during such year by the company from such business upon
investment contracts issued by the company and held by persons
residing within the state and elsewhere.
As used in this section, the term "investment company"
means any person, co-partnership, association, or corporation,
whether local or foreign, coming within the purview of section
54.26, and who or which is registered under the Investment
Company Act of 1940 (15 U.S.C. 80a-1 and following), and who or
which solicits or receives payments to be made to himself or
itself and which issues therefor, or has issued therefor and has
or shall have outstanding so-called bonds, shares, coupons,
certificates of membership, or other evidences of obligation or
agreement or pretended agreement to return to the holders or
owners thereof money or anything of value at some future date;
and as to whom the gross payments received during the taxable
year in question upon outstanding investment contracts, plus
interest and dividends earned on investment contracts determined
by prorating the total dividends and interest for the taxable
year in question in the same proportion that certificate
reserves as defined by the Investment Company Act of 1940 is to
total assets, shall be at least 50 percent of the company's
gross payments upon investment contracts plus gross income from
all other sources except dividends from subsidiaries for the
taxable year in question. The term "investment contract" shall
mean any such so-called bonds, shares, coupons, certificates of
membership, or other evidences of obligation or agreement or
pretended agreement issued by an investment company.
Sec. 5. Minnesota Statutes 1984, section 290.56,
subdivision 3, is amended to read:
Subd. 3. [FAILURE TO REPORT CHANGE OR CORRECTION OF
FEDERAL RETURN.] If a taxpayer shall fail to report a change or
correction or renegotiation by the Commissioner of Internal
Revenue or other officer of the United States or other competent
authority or shall fail to file a copy of an amended return
within 90 days as required by subdivision 2, the commissioner
may, within six years thereafter, recompute the tax, including a
refundment thereof, based upon such information as may be
available to him, notwithstanding any period of limitations to
the contrary.
If a taxpayer reports the change, correction, or
renegotiation, or files the amended return after the 90-day
period required by subdivision 2 has expired, the time limit for
the commissioner to recompute and reassess the tax due under
this chapter, including making a refund, is the time limit
provided in subdivision 4 determined from the date the report or
amended return was filed with the commissioner.
Sec. 6. [EFFECTIVE DATE.]
Section 1 is effective for taxable years beginning after
December 31, 1980. Section 3 is effective for taxable years
beginning after June 30, 1985. Sections 2 and 4 are effective
for taxable years beginning after December 31, 1985. Section 5
is effective for reports or returns filed after the day of final
enactment.
ARTICLE 3
INCOME TAX TECHNICAL
Section 1. Minnesota Statutes 1985 Supplement, section
270.77, is amended to read:
270.77 [SUBSTANTIAL UNDERSTATEMENT OF LIABILITY.]
(a) The commissioner of revenue shall impose a penalty for
substantial understatement of liability of any tax payable to
the commissioner. Except as otherwise provided in this section,
the penalty must be determined under section 6661 of the
Internal Revenue Code of 1954, as amended through December 31,
1984.
(b) The provisions of section 6661 (b)(3) of the Internal
Revenue Code of 1954, as amended through December 31, 1984 do
not apply.
(c) The penalty is not limited to taxes imposed by chapter
290.
(d) A substantial understatement of liability for a tax not
imposed by chapter 290 is an understatement that exceeds ten
percent of the tax required to be shown on the return or $5,000,
whichever is greater. There must be added to the tax an amount
equal to ten percent of the amount of any underpayment
attributable to the understatement. There is a substantial
understatement of tax for the period if the amount of the
understatement for the period exceeds the greater of: (1) ten
percent of the tax required to be shown on the return for the
period; or (2)(a) $10,000 in the case of a corporation other
than an S corporation as defined in section 290.9725 when the
tax is imposed by chapter 290, or (b) $5,000 in the case of any
other taxpayer, and in the case of a corporation any tax not
imposed by chapter 290. The term "understatement" means the
excess of the amount of the tax required to be shown on the
return for the period, over the amount of the tax imposed which
is shown on the return. The amount of the understatement shall
be reduced by that portion of the understatement which is
attributable to the tax treatment of any item by the taxpayer if
there is or was substantial authority for the treatment, or any
item with respect to which the relevant facts affecting the
item's tax treatment are adequately disclosed in the return or
in a statement attached to the return. The special rules in
cases involving tax shelters provided in section 6661(b)(2)(C)
of the Internal Revenue Code of 1954, as amended through
December 31, 1985, shall apply and shall apply to a tax shelter
the principal purpose of which is the avoidance or evasion of
state taxes. The commissioner may abate all or any part of the
addition to the tax provided by this section on a showing by the
taxpayer that there was reasonable cause for the understatement,
or part of it, and that the taxpayer acted in good faith.
Sec. 2. Minnesota Statutes 1985 Supplement, section
290.06, subdivision 3g, is amended to read:
Subd. 3g. [INFLATION ADJUSTMENT OF CREDITS.] For taxable
years beginning after December 31, 1985, the credits provided
for individuals in subdivision 3f shall be adjusted for
inflation. The dollar amount of each credit for the prior year
in subdivision 3f shall be increased in the same manner as by
the same percentage provided in subdivision 2d for the expansion
of the tax rate brackets. The resulting amount must be rounded
to the nearest whole dollar amount.
Sec. 3. Minnesota Statutes 1984, section 290.067,
subdivision 2, is amended to read:
Subd. 2. [LIMITATIONS.] The credit for expenses incurred
for the care of each dependent shall not exceed $720 in any
taxable year, and the total credit for all dependents of a
claimant shall not exceed $1,440 in a taxable year. The total
credit shall be reduced according to the amount of the combined
federal adjusted gross income, plus the ordinary income portion
of any lump sum distribution under section 402(e) of the
Internal Revenue Code of 1954, as amended through December 31,
1983, of the claimant and his spouse, if any, as follows:
income up to $10,000, $720 maximum for one dependent,
$1,440 for all dependents;
income of $10,001 to $11,000, $660 maximum for one
dependent, $1,320 for all dependents;
income over $11,000, the maximum credit for one dependent
shall be reduced by $10 for every $200 of additional income, $20
for all dependents;
$24,001 and over, no credit.
A married claimant shall file his income tax return for the
year for which he claims the credit either jointly or separately
on one form with his spouse. In the case of a married claimant
only one spouse may claim the credit.
The commissioner shall construct and make available to
taxpayers tables showing the amount of the credit at various
levels of income and expenses. The tables shall follow the
schedule contained in this subdivision, except that the
commissioner may graduate the transitions between expenses and
income brackets.
Sec. 4. Minnesota Statutes 1985 Supplement, section
290.068, subdivision 3, is amended to read:
Subd. 3. [LIMITATION; CARRYBACK AND CARRYOVER.] (a)(1) The
credit for the taxable year shall not exceed the liability for
tax. "Liability for tax" for purposes of this section means the
tax imposed under this chapter for the taxable year reduced by
the sum of the nonrefundable credits allowed under this chapter.
(2) In the case of a corporation which is a partner in a
partnership, the credit allowed for the taxable year shall not
exceed the lesser of the amount determined under clause (1) for
the taxable year or an amount (separately computed with respect
to the corporation's interest in the trade or business or
entity) equal to the amount of tax attributable to that portion
of taxable income which is allocable or apportionable to the
corporation's interest in the trade or business or entity.
(b) If the amount of the credit determined under this
section for any taxable year exceeds the limitation under clause
(a), the excess shall be a research credit carryback to each of
the three preceding taxable years and a research credit
carryover to each of the 15 succeeding taxable years. The
entire amount of the excess unused credit for the taxable year
shall be carried first to the earliest of the taxable years to
which the credit may be carried and then to each successive year
to which the credit may be carried. The amount of the unused
credit which may be added under this clause shall not exceed the
taxpayer's liability for tax less the research credit for the
taxable year.
For the purposes of sections 290.46 and 290.50, if the
claim for refund relates to an overpayment attributable to a
research and experimental expenditure credit carryback under
this subdivision, in lieu of the period of limitation prescribed
in sections 290.46 and 290.50, the period of limitation shall be
that period which ends with the expiration of the 15th day of
the 45th month following the end of the taxable year in which
the research and experimental expenditure credit arises which
results in the carryback, plus any extension of time granted for
filing the return, but only if the return was filed within the
extended time. With respect to any portion of a credit
carryback from a taxable year attributable to a loss carryback
from a subsequent taxable year, the period of limitations shall
be that period which ends with the expiration of the 15th day of
the 45th month following the end of the subsequent taxable year,
plus any extension of time granted for filing the return, but
only if the return was filed within the extended time. In any
case in which a taxpayer is entitled to a refund in a carryback
year due to the carryback of a research and experimental
expenditure credit, interest shall be computed only from the end
of the taxable year in which the credit arises. With respect to
any portion of a credit carryback from a taxable year
attributable to a loss carryback from a subsequent taxable year,
interest shall be computed from the end of the subsequent
taxable year.
Sec. 5. Minnesota Statutes 1985 Supplement, section
290.089, subdivision 3, is amended to read:
Subd. 3. [STANDARD DEDUCTION.] In lieu of the deductions
provided in subdivision 2, an individual may claim or be allowed
a standard deduction as follows:
(a) Subject to modification pursuant to clause (b), the
standard deduction shall be an amount equal to ten percent of
the gross income of the taxpayer or the joint gross income of a
married couple filing a joint return, up to a maximum deduction
of $2,400.
In the case of a married individual filing a separate
return, the standard deduction is ten percent of the gross
income of the taxpayer, up to a maximum of $1,200, except that
the standard deduction shall not be allowed to either if the net
income of one of the spouses is determined without regard to the
standard deduction.
(b) For taxable years beginning after December 31, 1985,
the maximum amount of the standard deduction shall be adjusted
for inflation in by the same manner percentage as provided in
section 290.06, subdivision 2d, for the expansion of the rate
brackets. The commissioner shall then round the maximum amount
of the standard deduction to the nearest hundred dollar amount.
When adjusting the maximum amount of standard deduction for
inflation, the commissioner shall use the actual dollar amount
of the maximum amount of the standard deduction prior to
rounding the dollar amounts.
(c) The commissioner of revenue may establish a standard
deduction tax table incorporating the rates set forth in section
290.06, subdivision 2c, and the standard deduction, and the
personal credits. The tax of any individual taxpayer whose
gross income is less than $20,000 an amount determined by the
commissioner shall, if an election is made not to itemize
nonbusiness deductions, be computed in accordance with tables
prepared and issued by the commissioner of revenue. The tables
shall be prepared to reflect the allowance of the standard
deduction and the personal and dependent credits.
Sec. 6. Minnesota Statutes 1985 Supplement, 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 adjusted gross income as defined
in the Internal Revenue Code;
(2) the taxpayer's federal tax preference items;
(3) the amount of interest income as provided by section
290.01, subdivision 20a, clauses (1), (3), and (4); less the sum
of
(i) interest income as defined in section 290.01,
subdivision 20b, clause (1); and
(ii) an overpayment of state income tax as provided by
section 290.01, subdivision 20b, clause (4); and
(iii) the amount of interest paid or accrued within the
taxable year on indebtedness to the extent that the amount does
not exceed qualified net investment income, as defined in
section 55(e)(5) of the Internal Revenue Code. Interest does
not include amounts deducted in computing federal adjusted gross
income or amounts that are not allowable under section 55(e)(8)
of the Internal Revenue Code.
In the case of an estate or trust, adjusted gross income
must be modified as provided in section 55(e)(6)(B) of the
Internal Revenue Code and reduced by the deductions allowed
under sections 642(c), 651(a), and 661(a) of the Internal
Revenue Code.
(b) "Federal tax preference items" means items as defined
in sections 57, 58, and 443(d) of the Internal Revenue Code,
modified as follows:
(1) The capital gain preference item shall be reduced where
the gain would be modified because some or all of the assets
have a higher basis for Minnesota purposes than for federal
purposes.
(2) In the case of a nonresident individual, or an estate
or trust, with a net operating loss that is a larger amount for
Minnesota than for federal, the capital gain preference item
shall be reduced to the extent it was reduced in the allowance
of the net operating loss.
(3) Federal preference items from the business of mining or
producing iron ore and other ores which are subject to the
occupation tax and exempt from taxation under section 290.05,
subdivision 1, shall not be a preference item for Minnesota.
(4) Other federal preference items to the extent not
allowed in the computation of Minnesota gross income, as
determined by the commissioner, are not preference items for
Minnesota.
(c) "Internal Revenue Code" means the Internal Revenue Code
of 1954, as amended through December 31, 1984.
(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.
Sec. 7. Minnesota Statutes 1985 Supplement, section
290.095, subdivision 9, is amended to read:
Subd. 9. [SPECIAL PERIOD OF LIMITATION WITH RESPECT TO NET
OPERATING LOSS CARRYBACKS.] For the purposes of sections 290.46
and 290.50 if the claim for refund relates to an overpayment
attributable to a net operating loss carryback under this
section or as the result in the case of an individual of an
adjustment of "federal adjusted gross income" because of the
carryback under section 172 of the Internal Revenue Code of
1954, as amended through December 31, 1983 1985, in lieu of the
period of limitation prescribed in sections 290.46 and 290.50,
the period shall be that period which ends with the expiration
of the 15th day of the 46th month (or the 45th month, in the
case of a corporation) following the end of the taxable year of
the net operating loss which results in such carryback or
adjustment of "federal adjusted gross income.," plus any
extension of time granted for filing the return, but only if the
return was filed within the extended time. During this extended
period, for taxable years beginning before January 1, 1985,
married individuals who elected to file separate returns or a
combined return may change their election and file a joint
return.
Sec. 8. Minnesota Statutes 1985 Supplement, section
290.095, subdivision 11, is amended to read:
Subd. 11. [CARRYBACK OR CARRYOVER ADJUSTMENTS.] (a) For
individuals the amount of a net operating loss that may be
carried back or carried over shall be the same dollar amount
allowable in the determination of federal adjusted gross
income. For estates and trusts the amount of a net operating
loss that may be carried back or carried over shall be the same
dollar amount allowable in the determination of federal taxable
income.
(b) The following adjustments to the amount of the net
operating loss that may be carried back or carried over must be
made for:
(1) Nonassignable income or losses for estates and trusts
as required by section 290.17, subdivision 2.
(2) Adjustments to the determination of federal adjusted
gross income that must be made because of changes in the
Internal Revenue Code that have not yet been adopted by the
legislature by updating the reference to the Internal Revenue
Code contained in section 290.01, subdivision 20.
(3) Gains or losses which result from the sale or other
disposition of property having a higher adjusted basis for
Minnesota income tax purposes than for federal income tax
purposes subject to the limitations contained in section 290.01,
subdivision 20b, clauses (2) and (3).
(4) Interest, taxes, and other expenses not allowed under
section 290.10, clause (9), for estates and trusts.
(5) The modification for accelerated cost recovery system
depreciation as provided in section 290.01, subdivision 20f.
(c)(1) The net operating loss carryback or carryover
applied as a deduction in the taxable year to which the net
operating loss is carried back or carried over shall be equal to
the net operating loss carryback or carryover applied in the
taxable year in arriving at federal adjusted gross income (or
federal taxable income for trusts and estates) subject to the
modifications contained in clause (b) and to the following
modifications:
(A) Increase the amount of carryback or carryover applied
in the taxable year by the amount of losses and interest, taxes
and other expenses not assignable or allowable to Minnesota
incurred in the taxable year.
(B) Decrease the amount of carryback or carryover applied
in the taxable year by the amount of income not assignable to
Minnesota earned in the taxable year.
(C) A taxpayer who is not a resident of Minnesota during
any part of the taxable year and who has no income assignable to
Minnesota during the taxable year shall apply no net operating
loss carryback or carryover in the taxable year.
(2) The provisions of section 172(b) of the Internal
Revenue Code of 1954 as amended through December 31, 1983
(relating to carrybacks and carryovers) shall apply. The net
operating loss carryback or carryover to the next consecutive
taxable year shall be the net operating loss carryback or
carryover as calculated in clause (c)(1) less the amount applied
in the earlier taxable year(s). No additional net operating
loss carryback or carryover shall be allowed if the entire
amount has been used to offset Minnesota income in a year
earlier than was possible on the federal return. A net
operating loss carryback or carryover that was allowed to offset
federal income in a year earlier than was possible on the
Minnesota return shall still be allowed to offset Minnesota
income but only if the loss was assignable to Minnesota in the
year the loss occurred.
(d) A net operating loss shall be allowed to be carried
back or carried forward only to the extent that loss was
assignable to Minnesota in the year the loss occurred or in the
year to which the loss was carried over, whichever would allow
more of the loss to be allowed for Minnesota purposes.
Sec. 9. Minnesota Statutes 1985 Supplement, section
290.10, is amended to read:
290.10 [NONDEDUCTIBLE ITEMS.]
In computing the net income no deduction shall in any case
be allowed for:
(1) personal, living or family expenses;
(2) amounts paid out for new buildings or for permanent
improvements or betterments made to increase the value of any
property or estate, except as otherwise provided in this chapter;
(3) amounts expended in restoring property or in making
good the exhaustion thereof for which an allowance is or has
been made;
(4) premiums paid on any life insurance policy covering the
life of the taxpayer or of any other person;
(5) the shrinkage in value, due to the lapse of time, of a
life or terminable interest of any kind in property acquired by
gift, devise, bequest or inheritance;
(6) losses from sales or exchanges of property, directly or
indirectly, between related taxpayers persons as defined and as
provided in section 267 of the Internal Revenue Code;
(7) in computing net income, no deduction shall be allowed
under section 290.09, subdivision 2, relating to expenses
incurred or under section 290.09, subdivision 3, relating to
interest accrued as provided in section 267 of the Internal
Revenue Code;
(8)(a) contributions by employees under the federal
railroad retirement act and the federal social security act;
(b) Payments to Minnesota or federal public employee retirement
funds; (c) 60 percent of the amount of taxes imposed on
self-employment income under section 1401 of the Internal
Revenue Code. Effective for taxable years beginning after
December 31, 1989, no deduction is allowed for self-employment
taxes where the taxpayer claimed a deduction for those taxes
under section 164(f) of the Internal Revenue Code;
(9) expenses, interest and taxes connected with or
allocable against the production or receipt of all income not
included in the measure of the tax imposed by this chapter,
except that for persons engaged in the business of mining or
producing iron ore, the mining of which is subject to the
occupation tax imposed by section 298.01, subdivision 1, this
shall not prevent a subtraction to the extent allowed under
section 290.01, subdivision 20b, clause (10)(b), or the
deduction by a corporate taxpayer of expenses and other items to
the extent that the expenses and other items are allowable under
section 290.09 and are not deductible, capitalizable, retainable
in basis, or taken into account by allowance or otherwise in
computing the occupation tax and do not exceed the amounts taken
for federal income tax purposes for that year. Occupation taxes
imposed under chapter 298, royalty taxes imposed under chapter
299, or depletion expenses may not be deducted under this clause;
(10) in situations where this chapter provides for a
subtraction from gross income of a specific dollar amount of an
item of income assignable to this state, and within the measure
of the tax imposed by this chapter, that portion of the federal
income tax liability assessed upon such income subtracted, and
any expenses attributable to earning such income, shall not be
deductible in computing net income;
(11) amounts paid or accrued for such taxes and carrying
charges as, under rules prescribed by the commissioner, are
chargeable to capital account with respect to property, if the
taxpayer elects, in accordance with such rules, to treat such
taxes or charges as so chargeable;
(12) no deduction or credit shall be allowed for any amount
paid or incurred during the taxable year in carrying on any
trade or business if the trade or business (or the activities
which comprise the trade or business) consists of trafficking in
controlled substances (within the meaning of schedule I and II
of the federal Controlled Substances Act) which is prohibited by
federal law or the law of Minnesota.
For purposes of this section, reference to the Internal
Revenue Code means the Internal Revenue Code of 1954, as amended
through December 31, 1984.
Sec. 10. Minnesota Statutes 1985 Supplement, section
290.13, subdivision 1, is amended to read:
Subdivision 1. [TRANSACTIONS IN WHICH NO GAIN OR LOSS IS
RECOGNIZED.] Gain or loss from transactions described in section
1031, 1032, 1035, 1036, or 1042 of the Internal Revenue Code of
1954, as amended through December 31, 1984 1985, shall be
recognized at the time and in the manner, including the basis
computation, provided in those sections.
Sec. 11. Minnesota Statutes 1985 Supplement, section
290.14, is amended to read:
290.14 [GAIN OR LOSS ON DISPOSITION OF PROPERTY, BASIS.]
Except as otherwise provided in this chapter, the basis for
determining the gain or loss from the sale or other disposition
of property acquired on or after January 1, 1933, shall be the
cost to the taxpayer of such property its adjusted basis for
federal income tax purposes, with the following exceptions:
(1) If the property should have been included in the last
inventory, it shall be the last inventory value thereof;
(2) If the property was acquired by gift, it shall be the
same as it would be if it were being sold or otherwise disposed
of by the last preceding owner not acquiring it by gift; if the
facts required for this determination cannot be ascertained, it
shall be the fair market value as of the date, or approximate
date, of acquisition by the last preceding owner, as nearly as
the requisite facts can be ascertained by the commissioner;
(3) If the property was acquired by gift through an inter
vivos transfer in trust, it shall be the same as it would be if
it were being sold or otherwise disposed of by the grantor;
(4) Except as otherwise provided in this clause, the basis
of property in the hands of a person acquiring the property from
a decedent or to whom the property passed from a decedent shall,
if not sold, exchanged or otherwise disposed of before the
decedent's death by the person, be the fair market value of the
property at the date of decedent's death or, in the case of an
election under section 2032 (relating to alternate valuation) of
the Internal Revenue Code of 1954, as amended through December
31, 1983, its valuation at the applicable valuation date
prescribed by that section, or in the case of an election under
section 2032A (relating to valuation of farm real property) of
the Internal Revenue Code of 1954, as amended through December
31, 1983, its value determined by that section.
For the purposes of the preceding paragraph, the following
property shall be considered to have been acquired from or to
have passed from the decedent:
(a) property acquired by bequest, devise, or inheritance,
or by the decedent's estate from the decedent;
(b) property transferred by the decedent during his
lifetime in trust to pay the income for life to or on the order
or direction of the decedent, with the right reserved to the
decedent at all times before his death to revoke the trust;
(c) property transferred by the decedent during his
lifetime in trust to pay the income for life to or on the order
or direction of the decedent with the right reserved to the
decedent at all times before his death to make any change in the
enjoyment thereof through the exercise of a power to alter,
amend, or terminate the trust;
(d) property passing without full and adequate
consideration under a general power of appointment exercised by
the decedent by will;
(e) in the case of a decedent's dying after December 31,
1956, property acquired from the decedent by reason of death,
form of ownership, or other conditions (including property
acquired through the exercise or nonexercise of a power of
appointment), if by reason thereof the property is required to
be included in determining the value of the decedent's gross
estate for Minnesota inheritance or estate tax purposes. In
this case, if the property is acquired before the death of the
decedent, the basis shall be the amount determined under the
first paragraph of this clause reduced by the amount allowed to
the taxpayer as deductions in computing taxable net income under
this chapter or prior Minnesota income tax laws for exhaustion,
wear and tear, obsolescence, amortization, and depletion on the
property before the death of the decedent. The basis shall be
applicable to the property commencing on the death of the
decedent. This paragraph shall not apply to annuities and
property described in paragraphs (a), (b), (c) and (d) of this
clause.
This clause shall not apply to property which constitutes a
right to receive an item of income in respect of a decedent
under section 290.077.
(5) If substantially identical property was acquired in the
place of stocks or securities which were sold or disposed of and
in respect of which loss was not allowed as a deduction under
section 290.089 or 290.09, subdivision 5, the basis in the case
of property so acquired shall be the same as that provided in
section 1091 of the Internal Revenue Code of 1954, as amended
through December 31, 1983.
(6) Neither the basis nor the adjusted basis of any portion
of real property shall, in the case of a lessor of the property,
be increased or diminished on account of income derived by the
lessor in respect of the property and excludable from gross
income under section 290.08, subdivision 14.
If an amount representing any part of the value of real
property attributable to buildings erected or other improvements
made by a lessee in respect of the property was included in
gross income of the lessor for any taxable year beginning before
January 1, 1943, the basis of each portion of the property shall
be properly adjusted for the amount included in gross income.
(1) Corporations, partnerships, or individuals subject to
the occupation tax under Minnesota Statutes, chapter 298, shall
use the occupation tax basis;
(7) (2) The basis of property subject to the provisions of
section 1034 of the Internal Revenue Code of 1954, as amended
through December 31, 1983 1985 (relating to the rollover of gain
on sale of principal residence) shall be the same as the basis
for federal income tax purposes. The basis shall be increased
by the amount of gain realized on the sale of a principal
residence outside of Minnesota, while a nonresident of this
state, which gain was not recognized because of the provisions
of section 1034.
Sec. 12. Minnesota Statutes 1985 Supplement, section
290.21, subdivision 4, is amended to read:
Subd. 4. (a) 85 percent of dividends received by a
corporation during the taxable year from another corporation,
when the corporate stock with respect to which dividends are
paid does not constitute the stock in trade of the taxpayer or
would not be included in the inventory of the taxpayer, or does
not constitute property held by the taxpayer primarily for sale
to customers in the ordinary course of his trade or business, or
when the trade or business of the taxpayer does not consist
principally of the holding of the stocks and the collection of
the income and gains therefrom. The remaining 15 percent shall
be allowed if the recipient owns 80 percent or more of all the
voting stock of the other corporation.
(b) If the trade or business of the taxpayer consists
principally of the holding of the stocks and the collection of
the income and gains therefrom, dividends received by a
corporation during the taxable year from another corporation, if
the recipient owns 80 percent or more of all the voting stock of
the other corporation.
(c) The dividend deduction provided in this subdivision
shall be allowed only with respect to dividends that are
included in a corporation's Minnesota taxable net income for the
taxable year.
The dividend deduction provided in this subdivision does
not apply to a dividend from a corporation which, for the
taxable year of the corporation in which the distribution is
made or for the next preceding taxable year of the corporation,
is a corporation exempt from tax under section 501 of the
Internal Revenue Code of 1954, as amended through December 31,
1984.
The dividend deduction provided in this subdivision applies
to the amount of regulated investment company dividends only to
the extent determined under section 854(b) of the Internal
Revenue Code of 1954, as amended through December 31, 1984.
The dividend deduction provided in this subdivision shall
not be allowed with respect to any dividend for which a
deduction is not allowed under the provisions of section 246(c)
of the Internal Revenue Code of 1954, as amended through
December 31, 1984.
(d) If dividends received by a corporation that does not
have nexus with Minnesota under the provisions of Public Law
Number 86-272 are included as income on the return of an
affiliated corporation permitted or required to file a combined
report under section 290.34, subdivision 2, then for purposes of
this subdivision the determination as to whether the trade or
business of the corporation consists principally of the holding
of stocks and the collection of income and gains therefrom shall
be made with reference to the trade or business of the
affiliated corporation having a nexus with Minnesota.
(e) Dividends received by a corporation from another
corporation which is organized under the laws of a foreign
country or a political subdivision of a foreign country, if the
dividends are paid from income arising from sources without the
United States, the commonwealth of Puerto Rico, and the
possessions of the United States. The deduction provided by
this clause does not apply if the corporate stock with respect
to which dividends are paid constitutes the stock in trade of
the taxpayer, or would be included in the inventory of the
taxpayer, or constitutes property held by the taxpayer primarily
for sale to customers in the ordinary course of the taxpayer's
trade or business, or if the trade or business of the taxpayer
consists principally of the holding of stocks and the collection
of the income or gains therefrom, or if the dividends are paid
by a FSC as defined in section 922 of the Internal Revenue Code
of 1954, as amended through December 31, 1985. No dividend may
be deducted under this clause if it is deducted under clause (a).
Sec. 13. Minnesota Statutes 1985 Supplement, section
290.21, subdivision 8, is amended to read:
Subd. 8. [FOREIGN SOURCE ROYALTIES.] (a) Rentals, fees,
and royalties accrued or received from a foreign corporation for
the use of or for the privilege of using outside of the United
States patents, copyrights, secret processes and formulas, good
will, know-how, trademarks, trade brands, franchises, and other
like property. Rentals, fees, or royalties deducted under this
subdivision shall not be included in the taxpayer's
apportionment factors under section 290.19, subdivision 1,
clause (1)(a) or (2)(a)(1). The preceding sentence shall not be
construed to imply that nondeductible rentals, fees, and
royalties from such properties are or were included in or
excluded from the apportionment factors under any other
provision of law.
(b) A corporation is allowed the deduction provided by this
subdivision only if during the taxable year it received or
accrued at least 80 percent of its gross income from sources as
defined in clause (a) and from dividends received from foreign
corporations. A corporation's gross income for purposes of
paragraphs (b) and (c) shall be computed without regard to the
requirement of section 290.34, subdivision 2, that a combined
report be filed reflecting the entire income of the unitary
business.
(c) For purposes of this subdivision, a foreign corporation
is (i) a corporation organized under the laws of a foreign
country or the political subdivision of a foreign country or
(ii) a corporation which for the taxable year derives at least
80 percent of its gross income from sources without the United
States, the commonwealth of Puerto Rico, and the possessions of
the United States. A foreign corporation does not include a
DISC as defined in section 992(a) of the Internal Revenue Code
of 1954, as amended through December 31, 1983, or a FSC as
defined in section 922 of the Internal Revenue Code of 1954, as
amended through December 31, 1985.
(d) The deduction provided in this subdivision is allowed
only with respect to rentals, fees, and royalties that are
included in a corporation's Minnesota taxable net income for the
taxable year.
Sec. 14. Minnesota Statutes 1984, section 290.281,
subdivision 5, is amended to read:
Subd. 5. [RETURN REQUIRED OF BANK.] Every bank maintaining
a common trust fund shall make a return for each taxable year,
stating specifically, with respect to such fund, the items of
gross income and deductions allowed by this section, and shall
include in the return the names and addresses of the
participants who would be entitled to share in the net income if
distributed and the amount of the proportionate share of each
participant. The return shall be sworn to as in the case of a
return required to be filed by the bank under section 290.361.
Sec. 15. Minnesota Statutes 1984, section 290.34,
subdivision 2, is amended to read:
Subd. 2. [AFFILIATED OR RELATED CORPORATIONS, COMBINED
REPORT.] When a corporation which is required to file an income
tax return is affiliated with or related to any other
corporation through stock ownership by the same interests or as
parent or subsidiary corporations, or has its income regulated
through contract or other arrangement, the commissioner of
revenue may permit or require such combined report as, in his
opinion, is necessary in order to determine the taxable net
income of any one of the affiliated or related corporations.
For purposes of computing either the arithmetic average or
weighted apportionment formulas under section 290.19,
subdivision 1 for each corporation involved, the numerator of
the fraction shall be that corporation's sales, property, and
payroll in Minnesota and the denominator shall be the total
sales, payroll, and property of all the corporations shown on
the combined report. The combined report shall reflect the
income of the entire unitary business as provided in section
290.17, subdivision 2, clause (4). The combined report shall
reflect income only from corporations created or organized in
the United States or under the laws of the United States or of
any state, the District of Columbia, the commonwealth of Puerto
Rico, any possession of the United States, or any political
subdivision of any of the foregoing and from a FSC as defined in
section 922 of the Internal Revenue Code of 1954, as amended
through December 31, 1985. All intercompany transactions
between companies which are contained on the combined report
shall be eliminated. This subdivision shall not apply to
insurance companies whose income is determined under section
290.35 or to investment companies whose income is determined
under section 290.36.
Sec. 16. Minnesota Statutes 1985 Supplement, section
290.41, subdivision 1, is amended to read:
Subdivision 1. [PARTNERSHIPS, FIDUCIARIES, AND S
CORPORATIONS.] (a) Partnerships shall make a return for each
taxable year which shall conform to the requirements of section
290.31, and shall, in addition, include the names and addresses
of all partners entitled to a distributive share in their
taxable net income and the amount of such distributive share to
which each is entitled. The return shall contain or be verified
by a written declaration that it is made under the penalties of
criminal liability for willfully making a false return correct
and complete. Each partnership required to file a return for
any partnership taxable year shall, on or before the day on
which the return for the taxable year was filed, furnish to each
person who is a partner at any time during the taxable year a
copy of the information shown on the return as may be required.
(b) The fiduciary of any estate or trust making the return
required to be filed under this chapter for any taxable year
shall, on or before the date on which the return was filed,
furnish to each beneficiary who receives a distribution from the
estate or trust with respect to the taxable year or to whom any
item with respect to the taxable year is allocated, a statement
containing the information shown on the return as the
commissioner may require.
(c) Each S corporation required to file a return under
section 290.974 for any taxable year shall, on or before the day
on which the return for the taxable year was filed, furnish to
each person who is a shareholder at any time during the taxable
year a copy of the information shown on the return.
(d) The statements required to be given to the partners,
beneficiaries, or shareholders by this subdivision must be
furnished at the time required by this subdivision,
notwithstanding section 290.42, clause (7).
Sec. 17. Minnesota Statutes 1984, section 290.50,
subdivision 3, is amended to read:
Subd. 3. [EXCEPTIONS.] This section shall not be construed
so as to disallow:
(a) a net operating loss carryback to any taxable year
authorized by section 290.095 or section 172 of the Internal
Revenue Code of 1954, as amended through December 31, 1983, but
the refund or credit shall be limited to the amount of
overpayment arising from the carryback;
(b) a capital loss carryback by a corporation under section
290.16, provided that the claim for refund or credit is made
prior to the expiration of the 15th day of the 45th month
following the end of the taxable year of the net capital loss
which results in the carryback, plus any extension of time
granted for filing the return, but only if the return was filed
within the extended time, and the refund or credit is limited to
the amount of overpayment arising from the carryback.
Sec. 18. Minnesota Statutes 1985 Supplement, section
290.92, subdivision 2a, is amended to read:
Subd. 2a. [COLLECTION AT SOURCE.] (1) [DEDUCTIONS.] Every
employer making payment of wages shall deduct and withhold upon
such wages a tax as provided in this section.
(2) [WITHHOLDING ON PAYROLL PERIOD.] The employer shall
withhold the tax on the basis of each payroll period or as
otherwise provided in this section.
(3) [WITHHOLDING TABLES.] Unless the amount of tax to be
withheld is determined as provided in subdivision 3, the amount
of tax to be withheld for each individual shall be based upon
tables to be prepared and distributed by the commissioner. The
tables shall be computed for the several permissible withholding
periods and shall take account of exemptions allowed under this
section; and the amounts computed for withholding shall be such
that the amount withheld for any individual during his taxable
year shall approximate in the aggregate as closely as possible
the tax which is levied and imposed under this chapter for that
taxable year, upon his salary, wages, or compensation for
personal services of any kind for the employer, and shall take
into consideration the optional deduction for federal income tax
and the deduction allowable under section 290.089, subdivision
3, and the personal credits allowed against the tax.
(4) [MISCELLANEOUS PAYROLL PERIOD.] If wages are paid with
respect to a period which is not a payroll period, the amount to
be deducted and withheld shall be that applicable in the case of
a miscellaneous payroll period containing a number of days,
including Sundays and holidays, equal to the number of days in
the period with respect to which such wages are paid.
(5) [MISCELLANEOUS PAYROLL PERIOD.] (a) In any case in
which wages are paid by an employer without regard to any
payroll period or other period, the amount to be deducted and
withheld shall be that applicable in the case of a miscellaneous
payroll period containing a number of days equal to the number
of days, including Sundays and holidays, which have elapsed
since the date of the last payment of such wages by such
employer during the calendar year, or the date of commencement
of employment with such employer during such year, or January 1
of such year, whichever is the later.
(b) In any case in which the period, or the time described
in clause (a), in respect of any wages is less than one week,
the commissioner, under regulations prescribed by him, may
authorize an employer to determine the amount to be deducted and
withheld under the tables applicable in the case of a weekly
payroll period, in which case the aggregate of the wages paid to
the employee during the calendar week shall be considered the
weekly wages.
(6) [WAGES COMPUTED TO NEAREST DOLLAR.] If the wages exceed
the highest bracket, in determining the amount to be deducted
and withheld under this subdivision, the wages may, at the
election of the employer, be computed to the nearest dollar.
(7) [REGULATIONS ON WITHHOLDING.] The commissioner may, by
rule, authorize employers:
(a) to estimate the wages which will be paid to any
employee in any quarter of the calendar year;
(b) to determine the amount to be deducted and withheld
upon each payment of wages to such employee during such quarter
as if the appropriate average of the wages so estimated
constituted the actual wages paid; and
(c) to deduct and withhold upon any payment of wages to
such employee during such quarter such amount as may be
necessary to adjust the amount actually deducted and withheld
upon wages of such employee during such quarter to the amount
required to be deducted and withheld during such quarter without
regard to this paragraph (7).
(8) [ADDITIONAL WITHHOLDING.] The commissioner is
authorized to provide by rule for increases or decreases in the
amount of withholding otherwise required under this section in
cases where the employee requests the changes. Such additional
withholding shall for all purposes be considered tax required to
be deducted and withheld under this section.
(9) [TIPS.] In the case of tips which constitute wages,
this subdivision shall be applicable only to such tips as are
included in a written statement furnished to the employer
pursuant to section 6053 of the Internal Revenue Code of 1954,
as amended through December 31, 1983 1985, and only to the
extent that the tax can be deducted and withheld by the
employer, at or after the time such statement is so furnished
and before the close of the calendar year in which such
statement is furnished, from such wages of the employee
(excluding tips, but including funds turned over by the employee
to the employer for the purpose of such deduction and
withholding) as are under the control of the employer; and an
employer who is furnished by an employee a written statement of
tips (received in a calendar month) pursuant to section 6053 of
the Internal Revenue Code of 1954 as amended through December
31, 1983 1985, to which subdivision 1 is applicable may deduct
and withhold the tax with respect to such tips from any wages of
the employee (excluding tips) under his control, even though at
the time such statement is furnished the total amount of the
tips included in statements furnished to the employer as having
been received by the employee in such calendar month in the
course of his employment by such employer is less than $20.
Such tax shall not at any time be deducted and withheld in an
amount which exceeds the aggregate of such wages and funds as
are under the control of the employer minus any tax required by
other provisions of state or federal law to be collected from
such wages and funds.
(10) [VEHICLE FRINGE BENEFITS.] An employer may elect shall
not to deduct and withhold any tax under this section with
respect to any vehicle fringe benefit provided to an employee if
the employer has so elected for federal purposes and the
requirement of and the definition contained in section 3402(s)
of the Internal Revenue Code of 1954, as amended through May
25 December 31, 1985, are complied with.
Sec. 19. Minnesota Statutes 1985 Supplement, section
290.93, subdivision 10, is amended to read:
Subd. 10. [UNDERPAYMENT OF ESTIMATED TAX.] (1) In the case
of any underpayment of estimated tax by an individual, except as
provided in paragraph (4), (5), or (6), there must be added to
and become a part of the taxes imposed by this chapter, for the
taxable year an amount determined at the rate specified in
section 270.75 upon the amount of the underpayment for the
period of the underpayment.
(2) For purposes of the preceding paragraph, the amount of
underpayment shall be the excess of
(a) the amount of the installment which would be required
to be paid if the estimated tax were equal to 80 percent (66-2/3
percent in the case of farmers referred to in subdivision 5(2))
of the taxes shown on the return for the taxable year or 80
percent (66-2/3 percent in the case of farmers referred to
above) the taxes for such year if no return was filed, over
(b) the amount, if any, of the installment paid on or
before the last day prescribed for such payment.
(3) The period of the underpayment shall run from the date
the installment was required to be paid to whichever of the
following dates is the earlier
(a) The 15th day of the fourth month following the close of
the taxable year.
(b) With respect to any portion of the underpayment, the
date on which such portion is paid. For purposes of this
subparagraph, a payment of estimated tax on any installment date
shall be considered a payment of any unpaid required
installments in the order in which the installments are required
to be paid.
(4) The addition to the tax with respect to any
underpayment of any installment shall not be imposed if the
total amount of all payments of estimated tax made on or before
the last date prescribed for the payment of such installment
equals or exceeds the amount which would have been required to
be paid on or before such date if the estimated tax were
whichever of the following is the lesser The amount of any
installment required to be paid shall be 25 percent of the
required annual payment except as provided in paragraph (c).
The term "required annual payment" means the lesser of
(a) 80 percent (66-2/3 percent in the case of farmers
referred to in subdivision 5, paragraph (2)), of the tax shown
on the return for the taxable year or 80 percent (66-2/3 percent
in the case of farmers referred to above) of the tax for the
year if no return is filed, or
(b) The total tax liability shown on the return of the
individual for the preceding taxable year (if a return showing a
liability for such taxes was filed by the individual for the
preceding taxable year of 12 months), or
(b) (c) An amount equal to the applicable percentage of the
tax for the taxable year (after deducting personal credits)
computed by placing on an annualized basis the taxable income
and alternative minimum taxable income for the months in the
taxable year ending before the month in which the installment is
required to be paid. The applicable percentage of the tax is 20
percent in the case of the first installment, 40 percent for the
second installment, 60 percent for the third installment, and 80
percent for the fourth installment. For purposes of this
subparagraph, the taxable income and alternative minimum taxable
income shall be placed on an annualized basis by
(i) Multiplying by 12 (or in the case of a taxable year of
less than 12 months, the number of months in the taxable year)
the taxable income and alternative minimum taxable income
computed for the months in the taxable year ending before the
month in which the installment is required to be paid.
(ii) Dividing the resulting amount by the number of months
in the taxable year ending before the month in which such
installment date falls.
(5) No addition to the tax shall be imposed under this
subdivision for any taxable year if:
(a) the individual did not have any liability for tax for
the preceding taxable year,
(b) the preceding taxable year was a taxable year of 12
months, and
(c) the individual was a resident of Minnesota throughout
the preceding taxable year.
(6) No addition to the tax shall be imposed under this
subdivision with respect to any underpayment to the extent the
commissioner determines that the provisions of section
6654(e)(3) of the Internal Revenue Code of 1954, as amended
through December 31, 1984, apply.
(7) For the purposes of applying this subdivision, the
estimated tax shall be computed without any reduction for the
amount which the individual estimates as his credit under
section 290.92, subdivision 12 (relating to tax withheld at
source on wages), and any other refundable credits which are
allowed against income tax liability, and the amount of such
credits for the taxable year shall be deemed a payment of
estimated tax, and an equal part of such amounts shall be deemed
paid on each installment date (determined under subdivisions 6
and 7) for such taxable year, unless the taxpayer establishes
the dates on which all amounts were actually withheld, in which
case the amounts so withheld shall be deemed payments of
estimated tax on the dates on which such amounts were actually
withheld.
Sec. 20. Minnesota Statutes 1984, section 290A.03,
subdivision 8, is amended to read:
Subd. 8. [CLAIMANT.] (a) "Claimant" means a person, other
than a dependent, who filed a claim authorized by this chapter
and who was domiciled in this state 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, or long term residential
facility 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.41, the medical assistance
program pursuant to title XIX of the Social Security Act, or the
general assistance medical care program pursuant to section
256D.03, subdivision 3. 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 reduced by the total amount of income
from the above sources other than vendor payments under the
medical assistance program or the general assistance medical
care program and the denominator of which is income as defined
in subdivision 3 plus vendor payments under the medical
assistance program or the general assistance medical care
program, to determine the allowable refund pursuant to this
chapter. For purposes of this paragraph and paragraph (d),
household income or income as defined in subdivision 3 must not
be reduced by the $2,000 reduction provided in subdivision 3,
paragraph (2), clause (f), for claimants who are disabled or age
65 or more.
(d) Notwithstanding paragraph (c), if the claimant was a
resident of the nursing home, intermediate care facility or long
term residential facility 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, intermediate
care facility, or long term residential 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 his 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 and his 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 husband and wife, 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 his household income for purposes of
computing the amount of credit to be allowed.
Sec. 21. [REPEALER.]
(a) Minnesota Statutes 1984, sections 290.06, subdivision
15, and 290.39, subdivision 1a, are repealed.
(b) Laws 1985, First Special Session chapter 14, article
21, sections 16 and 17, are repealed.
(c) Minnesota Statutes 1984, section 290A.04, subdivision
2f, is repealed.
Sec. 22. [EFFECTIVE DATE.]
Section 1 is effective for returns filed after June 30,
1985. Sections 2, 3, 5, paragraph (b), 8, 9, 14, 16, 19, and
21, paragraph (b), are effective for taxable years beginning
after December 31, 1984. Sections 4, 7, 17, and 18 are
effective the day after final enactment. Section 5, paragraph
(c), is effective for taxable years beginning after December 31,
1981. The amendment to paragraph (a) adding clause (3) and the
new language in clause (3)(ii) in section 6 is effective for
taxable years beginning after December 31, 1985. The other
amendments in section 6 are effective for taxable years
beginning after December 31, 1984. Sections 10, 11, and 21,
paragraph (a), are effective for taxable years beginning after
December 31, 1985. Sections 12, 13, and 15 are effective for
transactions after December 31, 1984, in tax years ending after
such date. Section 20 is effective for claims based on rent
paid in 1985 and thereafter. Section 21, paragraph (c), is
effective for claims based on property taxes payable in 1985 and
thereafter.
ARTICLE 4
PROPERTY TAX
Section 1. Minnesota Statutes 1984, section 69.021,
subdivision 4, is amended to read:
Subd. 4. [DETERMINATION OF QUALIFIED STATE AID RECIPIENTS;
CERTIFICATION TO COMMISSIONER OF FINANCE.] The commissioner
shall determine which municipalities and independent nonprofit
firefighting corporations are qualified to receive fire state
aid and which municipalities and counties are qualified to
receive police state aid. Any municipality, independent
nonprofit firefighting corporation or county which received
state aid for the year immediately previous shall be presumed to
be qualified to receive state aid for the year in question. If
subsequent examination reveals that the state aid recipient was
not in fact qualified to receive state aid for any year, the
commissioner shall retroactively disqualify the recipient and
shall take any necessary steps to recover the state aid payments
which had been made for the years of disqualification, plus
interest at a rate equal to the maximum lawful interest rate for
a state bank pursuant to section 48.195, as of the date of
disqualification, compounded annually from the date on which the
state aid payment was made until the date on which the payment
is recovered. The determination of qualification by the
commissioner shall be based on information contained in the fire
department, personnel and equipment certification required
pursuant to section 69.011, the annual financial report required
pursuant to section 69.051, any actuarial valuation or
experience study report required pursuant to sections 69.77 or
69.773, any audits conducted by the state auditor or an
independent auditor, and any other relevant information which
comes to the attention of the commissioner. Upon completion of
the determination, on or before June 1, the commissioner shall
calculate pursuant to subdivision 6 the amount of fire state aid
and police state aid which each county, municipality, or
independent nonprofit firefighting corporation is to receive for
subsequent apportionment pursuant to subdivision 7 and shall
certify to the commissioner of finance the name of each county
in which are located one or more qualified state aid recipients,
municipality, or independent nonprofit firefighting corporation
and the amount of state aid which each county is to receive for
subsequent apportionment. The commissioner shall also certify
to each county auditor the name of each qualified state aid
recipient located in the county and any other information deemed
necessary for the county auditor to make the subsequent
apportionment of state aid.
Sec. 2. Minnesota Statutes 1984, section 69.021,
subdivision 5, is amended to read:
Subd. 5. [CALCULATION OF STATE AID.] The amount of state
aid available for apportionment shall be two percent of the
fire, lightning, sprinkler leakage and extended coverage
premiums reported to the commissioner by insurers on the
Minnesota Firetown Premium Report and two percent of the
premiums reported to the commissioner by insurers on the
Minnesota Aid to Police Premium Report. The amount for
apportionment in respect to firefighter's state aid shall not be
greater or lesser than the amount of premium taxes paid to the
state upon the premiums reported to the commissioner by insurers
on the Minnesota Firetown Premium Report. The total amount for
apportionment in respect to police state aid shall not be
greater or lesser than the amount of premium taxes paid to the
state upon the premiums reported to the commissioner by insurers
on the Minnesota Aid to Police Premium Report. The total amount
for apportionment in respect to police state aid shall be
distributed to the counties for apportionment to municipalities
maintaining police departments and to the county on the basis of
the number of active peace officers, as certified pursuant to
section 69.011, subdivision 2, clause (b). 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.
Sec. 3. Minnesota Statutes 1984, section 69.021,
subdivision 7, is amended to read:
Subd. 7. [APPORTIONMENT OF AID TO MUNICIPALITIES AND
FIREFIGHTER'S RELIEF ASSOCIATIONS BY COUNTY AUDITOR.] (1) The
county auditor commissioner shall apportion the state aid
received by him relative to the premiums reported on the
Minnesota Firetown Premium Reports filed pursuant to this
chapter to each municipality and/or firefighter's relief
association certified to him by the commissioner in the same
manner that state aid is apportioned to the counties, one-half
in proportion to the population and one-half in proportion to
the assessed property valuation of the fire towns in the county
for which aid is proportioned. Necessary adjustments shall be
made to subsequent apportionments.
In the case of municipalities or independent fire
departments qualifying for the aid the county auditor
commissioner shall calculate the state aid for the municipality
or relief association on the basis of the population and the
property valuation of the area furnished fire protection service
by the fire department as evidenced by duly executed and valid
fire service agreements filed with him. If one or more fire
departments are furnishing contracted fire service to a city,
town or township only the population and valuation of the area
served by each fire department shall 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 assessed
property valuation of each service area. Agreement shall be in
writing and filed with the commissioner in duplicate. The
commissioner shall forward one copy of the agreement to the
county auditor of the county wherein the fire department is
located and retain one copy.
In the case of cities of the first and second class the
state aid calculated shall be paid directly to the treasurer of
the relief association. In the case of all other municipalities
and independent fire department relief associations or
retirement plans the aid shall be paid to the treasurer of the
municipality where the fire department is located and the
treasurer of the municipality shall within 30 days 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.
The county auditor and commissioner are is hereby empowered
to make rules and regulations to permit the administration of
the provisions of this section.
(2) The county auditor commissioner shall apportion the
state police aid received by him to each municipality and to the
county in the following manner:
(a) For all municipalities maintaining police departments
and the county, the state aid shall be distributed by the county
auditor in proportion to the total number of peace officers, as
determined pursuant to section 69.011, subdivision 1, clause
(g), and subdivision 2, clause (b), employed by each
municipality and by the county for 12 calendar months and the
proportional or fractional number who were employed less than 12
months;
(b) 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 shall be
credited against the municipality's contract obligation;
(c) 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 on a full time equivalent
basis shall be credited against the contract obligation of the
municipality receiving contract service;
(d) No municipality entitled to receive police state aid
shall be apportioned less police state aid for any year under
Laws 1976, Chapter 315, than the amount which was apportioned to
it for calendar year 1975 based on premiums reported to the
commissioner for calendar year 1974; provided, the amount of
police state aid to other municipalities within the county and
to the county shall be adjusted in proportion to the total
number of peace officers in the municipalities and the county,
so that the amount of police state aid apportioned shall not
exceed the amount of police state aid available for
apportionment.
The county auditor and commissioner are hereby empowered to
make rules and regulations to permit the administration of the
provisions of this section.
Sec. 4. Minnesota Statutes 1984, section 69.021,
subdivision 9, is amended to read:
Subd. 9. [APPEAL.] In the event that any fire or police
department feels itself to be aggrieved, it may request
the county board of the county wherein the fire or police
department is located commissioner to review and adjust the
apportionment of funds within the county and the decision of the
county board commissioner shall be subject to appeal, review,
and adjustment by the district court in the county in which the
fire or police department is located.
Sec. 5. Minnesota Statutes 1985 Supplement, section
69.031, subdivision 1, is amended to read:
Subdivision 1. [COMMISSIONER OF FINANCE'S WARRANT.] The
commissioner of finance shall issue to the auditor of each
county, municipality, or independent nonprofit firefighting
corporation certified to him by the commissioner his warrant for
an amount equal to the amount certified to by the commissioner
pursuant to section 69.021. The amount due to a county and not
paid by September 1 accrues interest at the rate of one percent
for each month or part of a month the amount remains unpaid,
beginning the preceding June 1.
Sec. 6. Minnesota Statutes 1984, section 69.031,
subdivision 3, is amended to read:
Subd. 3. [APPROPRIATIONS.] There is hereby appropriated
annually from the state general fund to the counties who are
entitled to payments under sections 69.021 and
69.031 commissioner of revenue an amount sufficient to make the
payments specified in these sections 69.021 and 69.031 not
exceeding the tax collected.
Sec. 7. Minnesota Statutes 1985 Supplement, section
116C.63, subdivision 4, is amended to read:
Subd. 4. When private real property defined as class 1a,
1b, 1c, 2a, 2c, 4a, 5a, or 6a pursuant to section 273.13 is
proposed to be acquired for the construction of a site or route
by eminent domain proceedings, the fee owner, or when
applicable, the fee owner with the written consent of the
contract for deed vendee, or the contract for deed vendee with
the written consent of the fee owner, shall have the option to
require the utility to condemn a fee interest in any amount of
contiguous, commercially viable land which he wholly owns or has
contracted to own in undivided fee and elects in writing to
transfer to the utility within 60 days after his receipt of the
notice of the objects of the petition filed pursuant to section
117.055. Commercial viability shall be determined without
regard to the presence of the utility route or site. The owner
or, when applicable, the contract vendee shall have only one
such option and may not expand or otherwise modify his election
without the consent of the utility. The required acquisition of
land pursuant to this subdivision shall be considered an
acquisition for a public purpose and for use in the utility's
business, for purposes of chapter 117 and section 500.24,
respectively; provided that a utility shall divest itself
completely of all such lands used for farming or capable of
being used for farming not later than the time it can receive
the market value paid at the time of acquisition of lands less
any diminution in value by reason of the presence of the utility
route or site. Upon the owner's election made under this
subdivision, the easement interest over and adjacent to the
lands designated by the owner to be acquired in fee, sought in
the condemnation petition for a high voltage transmission line
right-of-way shall automatically be converted into a fee taking.
Sec. 8. Minnesota Statutes 1984, section 124.195,
subdivision 5, is amended to read:
Subd. 5. [COMMISSIONER'S ASSUMPTIONS.] For purposes of
determining the amount of state general fund cash to be paid to
school districts pursuant to subdivision 3, the commissioner of
education shall:
(a) assume that the payments to school districts by the
county treasurer of revenues accruing to the fiscal year of
receipt pursuant to section 276.10 276.11 are made in the
following manner:
(1) 50 percent within seven business days of each due date;
and
(2) 100 percent within 14 business days of each due date;
(b) assume that the payments to school districts by the
county treasurer of revenues accruing to the fiscal year of
receipt pursuant to section 31 are made in the following manner:
(1) 50 percent within seven business days of the October 15
due date;
(2) 100 percent within 14 business days of the October 15
due date; and
(3) 100 percent within ten business days of the November 15
due date.
(c) assume that the payments to school districts by county
auditors pursuant to section 124.10, subdivision 2 are made at
the end of the months indicated in that subdivision.
Sec. 9. Minnesota Statutes 1985 Supplement, section
124.2131, subdivision 3, is amended to read:
Subd. 3. [DECREASE IN IRON ORE ASSESSED VALUE.] If in any
year the assessed value of class 9a and 9b property, as defined
in sections section 273.13, subdivision 30, and 273.165,
subdivision 2, in any district is less than the assessed value
of such property in the immediately preceding year, the
equalization aid review committee shall redetermine for all
purposes the adjusted assessed value of the immediately
preceding year taking into account only the decrease in assessed
value of class 9a and 9b property. If subdivision 2, clause (a)
is applicable to such a district, the decrease in class 9a and
9b property shall be applied to the adjusted assessed value as
limited therein. In all other respects, the provisions of
clause (1) shall be applicable.
Sec. 10. Minnesota Statutes 1984, section 270.12,
subdivision 2, is amended to read:
Subd. 2. The board shall meet annually on August 15 at the
office of the commissioner of revenue and examine and compare
the returns of the assessment of the property in the several
counties, and equalize the same so that all the taxable property
in the state shall be assessed at its market value, subject to
the following rules:
(1) The board shall add to the aggregate valuation of the
real property of every county, which the board believes to be
valued below its market value in money, such percent as will
bring the same to its market value in money;
(2) The board shall deduct from the aggregate valuation of
the real property of every county, which the board believes to
be valued above its market value in money, such percent as will
reduce the same to its market value in money;
(3) If the board believes the valuation of the real
property of any town or district in any county, or the valuation
of the real property of any county not in towns or cities,
should be raised or reduced, without raising or reducing the
other real property of such county, or without raising or
reducing it in the same ratio, the board may add to, or take
from, the valuation of any one or more of such towns or cities,
or of the property not in towns or cities, such percent as the
board believes will raise or reduce the same to its market value
in money;
(4) The board shall add to the aggregate valuation of any
class of personal property of any county, town, or city, which
the board believes to be valued below the market value thereof,
such percent as will raise the same to its market value in money;
(5) The board shall take from the aggregate valuation of
any class of personal property in any county, town or city,
which the board believes to be valued above the market value
thereof, such percent as will reduce the same to its market
value in money;
(6) The board shall not reduce the aggregate valuation of
all the property of the state, as returned by the several county
auditors, more than one percent on the whole valuation thereof;
and
(7) When it would be of assistance in equalizing values the
board may require any county auditor to furnish statements
showing assessments of real and personal property of any
individuals, firms, or corporations within the county. The
board shall consider and equalize such assessments and may
increase the assessment of individuals, firms, or corporations
above the amount returned by the county board of equalization
when it shall appear to be undervalued, first giving notice to
such persons of the intention of the board so to do, which
notice shall fix a time and place of hearing. The board shall
not decrease any such assessment below the valuation placed by
the county board of equalization; and
(8) In equalizing values pursuant to this section, the
board shall utilize a 12-month assessment/sales ratio study
conducted by the department of revenue containing only sales
that occurred between October 1 of the year immediately
preceding the previous year to September 30 of the previous
year. The sales prices used in the study must be discounted for
terms of financing. The board shall use the median ratio as the
statistical measure of the level of assessment for any
particular category of property.
Sec. 11. Minnesota Statutes 1984, section 273.072,
subdivision 1, is amended to read:
Subdivision 1. Any county and any city or town lying
wholly or partially within the county and constituting a
separate assessment district may, by agreement entered into
under section 471.59 and approved by the commissioner of
revenue, provide for the assessment of property in the
municipality or town by the county assessor. Any two or more
cities or towns constituting separate assessment districts,
whether their assessors are elective or appointive, may enter
into an agreement under section 471.59 for the assessment of
property in the contracting units by the assessor of one of the
units or by an assessor who is jointly employed.
Sec. 12. Minnesota Statutes 1985 Supplement, section
273.11, subdivision 8, is amended to read:
Subd. 8. [LIMITED EQUITY COOPERATIVE APARTMENTS.] For the
purposes of this subdivision, the terms defined in this
subdivision have the meanings given them.
A "limited equity cooperative" is a corporation organized
under chapter 308, which has as its primary purpose the
provision of housing and related services to its members, who
must be persons or families of low and moderate income as
defined in section 462A.03, subdivision 10, whose income must
not exceed 90 percent of the St. Paul-Minneapolis metropolitan
area income as determined by the United States Department of
Housing and Urban Development at the time they purchase their
membership, and which meets the following requirements:
(a) The articles of incorporation set the sale price of
occupancy entitling cooperative shares or memberships at no more
than a transfer value determined as provided in the articles.
That value may not exceed the sum of the following:
(1) the consideration paid for the membership or shares by
the first occupant of the unit, as shown in the records of the
corporation;
(2) the fair market value, as shown in the records of the
corporation, of any improvements to the real property that were
installed at the sole expense of the member with the prior
approval of the board of directors;
(3) accumulated interest, or an inflation allowance not to
exceed the greater of a ten percent annual noncompounded
increase on the consideration paid for the membership or share
by the first occupant of the unit, or the amount that would have
been paid on that consideration if interest had been paid on it
at the rate of the percentage increase in the revised consumer
price index for all urban consumers for the Minneapolis-St. Paul
metropolitan area prepared by the United States Department of
Labor, provided that the amount determined pursuant to this
clause may not exceed $500 for each year or fraction of a year
the membership or share was owned; plus
(4) real property capital contributions shown in the
records of the corporation to have been paid by the transferor
member and previous holders of the same membership, or of
separate memberships that had entitled occupancy to the unit of
the member involved. These contributions include contributions
to a corporate reserve account the use of which is restricted to
real property improvements or acquisitions, contributions to the
corporation which are used for real property improvements or
acquisitions, and the amount of principal amortized by the
corporation on its indebtedness due to the financing of real
property acquisition or improvement or the averaging of
principal paid by the corporation over the term of its real
property-related indebtedness.
(b) The articles of incorporation require that the board of
directors limit the purchase price of stock or membership
interests for new member-occupants or resident shareholders to
an amount which does not exceed the transfer value for the
membership or stock as defined in clause (a).
(c) The articles of incorporation require that the total
distribution out of capital to a member shall not exceed that
transfer value.
(d) The articles of incorporation require that upon
liquidation of the corporation any assets remaining after
retirement of corporate debts and distribution to members will
be conveyed to a charitable organization described in section
501(c)(3) of the Internal Revenue Code of 1954, as amended
through December 31, 1984, or a public agency.
A "limited equity cooperative apartment" is a dwelling unit
owned or leased by a limited equity cooperative. If the
dwelling unit is leased by the cooperative the lease agreement
must meet the conditions for a cooperative lease stated in
section 273.124, subdivision 6.
"Occupancy entitling cooperative share or membership" is
the ownership interest in a cooperative organization which
entitles the holder to an exclusive right to occupy a dwelling
unit owned or leased by the cooperative.
For purposes of taxation, the assessor shall value a unit
owned by a limited equity cooperative at the lesser of its
market value or the value determined by capitalizing the net
operating income of a comparable apartment operated on a rental
basis at the capitalization rate used in valuing comparable
buildings that are not limited equity cooperatives. If a
cooperative fails to operate in accordance with the provisions
of clauses (a) to (d), the property shall be subject to
additional property taxes in the amount of the difference
between the taxes determined in accordance with this subdivision
for the last ten years that the property had been assessed
pursuant to this subdivision and the amount that would have been
paid if the provisions of this subdivision had not applied to
it. The additional taxes, plus interest at the rate specified
in section 549.09, shall be extended against the property on the
tax list for the current year.
Sec. 13. Minnesota Statutes 1985 Supplement, section
273.124, subdivision 6, is amended to read:
Subd. 6. [LEASEHOLD COOPERATIVES.] When one or more
dwellings or one or more buildings which each contain several
dwelling units is owned by a nonprofit corporation subject to
the provisions of chapter 317 or a limited partnership which
corporation or partnership operates the property in conjunction
with a cooperative association, homestead treatment may be
claimed for each dwelling unit occupied by a member of the
cooperative. To qualify for the treatment provided by this
subdivision, the following conditions must be met: (a) the
cooperative association must be organized under sections 308.05
to 308.18; (b) the cooperative association must have a lease for
occupancy of the property for a term of at least 20 years;
(c) to the extent permitted under state or federal law, the
cooperative association must have a right under a written
agreement with the owner to purchase the property if the owner
proposes to sell it; if the cooperative association does not
purchase the property when it is offered for sale, the owner may
not subsequently sell the property to another purchaser at a
price lower than the price at which it was offered for sale to
the cooperative association unless the cooperative association
approves the sale; and (d) if a limited partnership owns the
property, it must include as the managing general partner either
the cooperative association or a nonprofit organization
operating under the provisions of chapter 317. Homestead
treatment must be afforded to units occupied by members of the
cooperative association and the units must be assessed as
provided in subdivision 1 3, provided that any unit not so
occupied shall be classified and assessed pursuant to the
appropriate class. No more than three acres of land may, for
assessment purposes, be included with each dwelling unit that
qualifies for homestead treatment under this subdivision.
Sec. 14. Minnesota Statutes 1985 Supplement, section
273.124, subdivision 8, is amended to read:
Subd. 8. [HOMESTEAD OWNED BY FAMILY FARM CORPORATION OR
PARTNERSHIP.] (a) Each family farm corporation and each
partnership operating a family farm is entitled to class 1 1b or
class 2a assessment for one homestead occupied by a shareholder
or partner thereof who is residing on the land and actively
engaged in farming of the land owned by the corporation or
partnership. Homestead treatment applies even if legal title to
the property is in the name of the corporation or partnership
and not in the name of the person residing on it. "Family farm
corporation" and "family farm" have the meanings given in
section 500.24.
(b) In addition to property specified in paragraph (a), any
other residences owned by corporations or partnerships described
in paragraph (a) which are located on agricultural land and
occupied as homesteads by shareholders or partners who are
actively engaged in farming on behalf of the corporation or
partnership must also be assessed as class 1 1b or class 2a
property, but the property eligible is limited to the residence
itself and as much of the land surrounding the homestead, not
exceeding one acre, as is reasonably necessary for the use of
the dwelling as a home, and does not include any other
structures that may be located on it.
Sec. 15. Minnesota Statutes 1985 Supplement, section
273.124, subdivision 9, is amended to read:
Subd. 9. [HOMESTEAD ESTABLISHED AFTER ASSESSMENT DATE.]
Any property that was not used for the purpose of a homestead on
the assessment date, but which was used for the purpose of a
homestead on June 1 of a year, constitutes class 1 or class 2a
to the extent of one-half of the valuation that would have been
includable in class 1 or class 2a.
Any taxpayer meeting the requirements of this subdivision
must notify the county assessor, or the assessor who has the
powers of the county assessor pursuant to section 273.063, in
writing, prior to June 15 of the year of occupancy in order to
qualify under this subdivision.
The county assessor and the county auditor may make the
necessary changes on their assessment and tax records to provide
for proper homestead classification as provided in this
subdivision.
The owner of any property qualifying under this
subdivision, which has not been accorded the benefits of this
subdivision, regardless of whether or not the notification has
been timely filed, may be entitled to receive homestead
classification by proper application as provided in section
270.07 or 375.192.
The county assessor shall publish in a newspaper of general
circulation within the county no later than June 1 of each year
a notice informing the public of the requirement to file an
application for homestead prior to June 15.
Sec. 16. Minnesota Statutes 1985 Supplement, section
273.124, subdivision 10, is amended to read:
Subd. 10. [REAL ESTATE PURCHASED FOR OCCUPANCY AS A
HOMESTEAD.] Real estate purchased for occupancy as a homestead
must be classified as class 1 or class 2a if the purchaser is
prevented from obtaining possession on January 2 next following
the purchase by reason of federal or state rent control laws or
regulations.
Sec. 17. Minnesota Statutes 1985 Supplement, section
273.124, subdivision 11, is amended to read:
Subd. 11. [LIMITATION ON HOMESTEAD CLASSIFICATION.] If the
assessor has classified a property as both homestead and
nonhomestead, the greater of the value attributable to the
portion of the property classified as class 1a, 1b, or 2a or the
value of the first tier of assessment percentages provided under
section 273.13, subdivision 22, paragraph (a) or (b) or
subdivision 23, paragraph (a) is entitled to homestead
treatment, except as provided in subdivision 26 for. The
limitation in this subdivision does not apply to buildings
containing fewer than four residential units and for or to a
single rented or leased dwelling unit located within or attached
to a private garage or similar structure owned by the owner of a
homestead and located on the premises of that homestead.
If the assessor has classified a property as both homestead
and nonhomestead, the homestead credit provided in section
273.13, subdivisions 22 and 23, and the reductions in tax
provided under sections 273.135 and 273.1391 apply to the value
of both the homestead and the nonhomestead portions of the
property.
Sec. 18. Minnesota Statutes 1985 Supplement, section
273.13, subdivision 15a, is amended to read:
Subd. 15a. [GENERAL FUND, REPLACEMENT OF REVENUE.] (1)
Payment from the general fund shall be made, as provided herein,
for the purpose of replacing revenue lost as a result of the
reduction of property taxes provided in subdivisions 22 and 23.
(2) Each county auditor shall certify, not later than May 1
of each year to the commissioner of revenue the amount of
reduction resulting from subdivisions 22 and 23 in his county
This certification shall be submitted to the commissioner of
revenue as part of the abstracts of tax lists required to be
filed with the commissioner under the provisions of section
275.29. Any prior year adjustments shall also be certififed in
the abstracts of tax lists. The commissioner of revenue shall
review such certifications to determine their accuracy. He may
make such changes in the certification as he may deem necessary
or return a certification to the county auditor for corrections.
(3) Based on current year tax data reported in the
abstracts of tax lists, the commissioner of revenue shall
annually determine the taxing district distribution of the
amounts certified under clause (2). The commissioner of revenue
shall pay to each taxing district, other than school districts,
its total payment for the year in equal installments on or
before July 15, August 15, September 15, October 15, November
15, and December 15 of each year.
Sec. 19. Minnesota Statutes 1985 Supplement, section
273.13, subdivision 26, is amended to read:
Subd. 26. [CLASS 5.] (a) Residential real estate
containing less than four units, other than seasonal
residential, recreational, and homesteads, is class 5a. Class
5a shall also include post-secondary student housing not to
exceed one acre of land which is owned by a nonprofit
corporation organized under chapter 317 and is used exclusively
by a sorority or fraternity organization for housing. Class 5a
property is assessed at 28 percent of market value.
(b) Structures of five stories or more and constructed with
materials meeting the requirements for type I or II construction
as defined in the state building code, if at least 90 percent of
the structure is used or to be used as apartment housing, is
class 5b. Class 5b property is assessed at 25 percent of market
value. The 25 percent assessment ratio applies to these
structures for a period of 40 years from the date of completion
of original construction, or the date of initial though partial
use, whichever is earlier.
(c) Manufactured homes not classified under any other
provision constitute class 5c. Class 5c property is assessed at
28 percent of market value.
Sec. 20. Minnesota Statutes 1985 Supplement, section
273.13, subdivision 28, is amended to read:
Subd. 28. [CLASS 7.] (a) Class 7a is a structure that is
situated on real property that is used for housing for the
elderly or for low and moderate income families as defined by
Title II of the National Housing Act or the Minnesota housing
finance agency law of 1971 or regulations promulgated by the
agency pursuant thereto and financed by a direct federal loan or
federally insured loan or a loan made by the Minnesota housing
finance agency pursuant to the provisions of either of those
acts and acts amendatory thereof. Class 7a property must, for
15 years from the date of the completion of the original
construction or substantial rehabilitation, or for the original
term of the loan, be assessed at 20 percent of the market value.
(b) Class 7b is a structure which is
(1) situated upon real property that is used for housing
lower income families or elderly or handicapped persons, as
defined in section 8 of the United States Housing Act of 1937,
as amended, and
(2) owned by an entity which has entered into a housing
assistance payments contract under section 8 which provides
assistance for 100 percent of the dwelling units in the
structure, other than dwelling units intended for management or
maintenance personnel. Class 7b property must, for the term of
the housing assistance payments contract, including all
renewals, or for the term of its permanent financing, whichever
is shorter, be assessed at 20 percent of its market value.
(c) Class 7c is any structure
(1) situated on real property that is used for housing for
the elderly or for low and moderate income families as defined
by the farmers home administration;
(2) located in a municipality of less than 10,000
population; and
(3) financed by a direct loan or insured loan from the
farmers home administration;
Class 7c property must be assessed at ten percent of its market
value for 15 years from the date of the completion of the
original construction or for the original term of the loan
except that if (1) construction of the structure had been
commenced after December 31, 1983; and (2) the project had been
approved by the governing body of the municipality in which it
is located after June 30, 1983; and (3) financing of the project
had been approved by a federal or state agency after June 30,
1983, it must be assessed at 20 percent.
The 20 percent and ten percent assessment ratios apply to
the properties described in paragraphs (a), (b), and (c) only in
proportion to occupancy of the structure by elderly or
handicapped persons or low and moderate income families as
defined in the applicable laws unless construction of the
structure had been commenced prior to January 1, 1984; or the
project had been approved by the governing body of the
municipality in which it is located prior to June 30, 1983; or
financing of the project had been approved by a federal or state
agency prior to June 30, 1983.
For all properties described in paragraphs (a), (b), and
(c), the market value determined by the assessor must be based
on the normal approach to value using normal unrestricted rents.
The provisions of paragraphs (a) and (c) apply only to
nonprofit and limited dividend entities.
(d) Class 7d property is a parcel of land, not to exceed
one acre, and its improvements or a parcel of unimproved land,
not to exceed one acre, if it is owned by a neighborhood real
estate trust and at least 60 percent of the dwelling units, if
any, on all land owned by the trust are leased to or occupied by
lower income families or individuals. Class 7d land and
improvements, if any, shall be assessed at 20 percent of the
market value. This paragraph shall not apply to any portion of
the land or improvements used for nonresidential purposes. For
purposes of this paragraph, a lower income family is a family
with an income that does not exceed 65 percent of the median
family income for the area, and a lower income individual is an
individual whose income does not exceed 65 percent of the median
individual income for the area, as determined by the United
States Secretary of Housing and Urban Development. For purposes
of this paragraph, "neighborhood real estate trust" means an
entity which is certified by the governing body of the
municipality in which it is located to have the following
characteristics: (1) it is a nonprofit corporation organized
under chapter 317; (2) it has as its principal purpose providing
housing for lower income families in a specific geographic
community designated in its articles or bylaws; (3) it limits
membership with voting rights to residents of the designated
community; and (4) it has a board of directors consisting of at
least seven directors, 60 percent of whom are members with
voting rights and, to the extent feasible, 25 percent of whom
are elected by resident members of buildings owned by the trust.
Sec. 21. Minnesota Statutes 1985 Supplement, section
273.13, subdivision 30, is amended to read:
Subd. 30. [CLASS 9.] (a) Unmined iron ore is class 9a and
is assessed at 50 percent of market value.
(b) Class 9b consists of all low-grade iron-bearing
formations as defined in section 273.14. Class 9b shall be
assessed at the following percentages of its value: If the
tonnage recovery is less than 50 percent and not less than 49
percent, the assessed value shall be 48-1/2 percent of the
value; if the tonnage recovery is less than 49 percent and not
less than 48 percent, the assessed value shall be 47 percent of
the value; and for each subsequent reduction of one percent in
tonnage recovery, the percentage of assessed value to value
shall be reduced an additional 1-1/2 percent of the value, but
the assessed value shall never be less than 30 percent of the
value. The land, exclusive of the formations, shall be assessed
as otherwise provided by law. The commissioner of revenue may
estimate the reasonable market value of the iron ore on any
parcel of land which at the assessment date is considered
uneconomical to mine.
Sec. 22. Minnesota Statutes 1985 Supplement, section
273.136, is amended to read:
273.136 [TACONITE PROPERTY TAX RELIEF FUND; REPLACEMENT OF
REVENUE.]
Subdivision 1. Payment from the county shall be made as
provided herein for the purpose of replacing revenue lost as a
result of the reduction of property taxes provided in section
273.135.
Subd. 2. The commissioner of revenue shall determine, not
later than May 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, basing his
determinations on a review of abstracts of tax lists submitted
by the county auditors pursuant to section 275.29. He may make
changes in the abstracts of tax lists as he deems necessary.
The commissioner of revenue, after such review, shall submit to
the St. Louis county auditor, on or before June 1 April 15, the
amount of the first half payment payable hereunder and on or
before October September 15 the amount of the second half
payment.
Subd. 3. The St. Louis county auditor shall pay out of the
taconite property tax relief account to each county treasurer
one-half of the amount certified under subdivision 2 not later
than June May 15 and the remaining half not later than November
October 15 of each year.
Subd. 4. The county treasurer shall distribute as part of
the May and October settlements the funds received by him as if
they had been collected as a part of the property tax reduced by
section 273.135.
Sec. 23. Minnesota Statutes 1984, section 273.1391,
subdivision 3, is amended to read:
Subd. 3. Not later than December 1, each county auditor
having jurisdiction over one or more tax relief areas defined in
subdivision 2 shall certify to the commissioner of revenue his
estimate of the total amount of the reduction, determined under
subdivision 2, in taxes payable the next succeeding year with
respect to all tax relief areas in his county. The commissioner
shall make payments to the county by May 15 and October 15
annually. The county treasurer shall distribute as part of the
May and October settlements the funds received from the
commissioner.
Sec. 24. Minnesota Statutes 1985 Supplement, section
273.42, subdivision 2, is amended to read:
Subd. 2. Owners of land defined as class 1a, 1b, 1c, 2a,
2c, 4a, 5a, or 6a, pursuant to section 273.13 listed on records
of the county auditor or county treasurer over which runs a high
voltage transmission line as defined in section 116C.52,
subdivision 3, except a high voltage transmission line the
construction of which was commenced prior to July 1, 1974, shall
receive a property tax credit in an amount determined by
multiplying a fraction, the numerator of which is the length of
high voltage transmission line which runs over that parcel and
the denominator of which is the total length of that particular
line running over all property within the city or township by
ten percent of the transmission line tax revenue derived from
the tax on that portion of the line within the city or township
pursuant to section 273.36. In the case of property owners in
unorganized townships, the property tax credit shall be
determined by multiplying a fraction, the numerator of which is
the length of the qualifying high voltage transmission line
which runs over the parcel and the denominator of which is the
total length of the qualifying high voltage transmission line
running over all property within all the unorganized townships
within the county, by the total utility property tax credit fund
amount available within the county for that year pursuant to
subdivision 1. Where a right-of-way width is shared by more
than one property owner, the numerator shall be adjusted by
multiplying the length of line on the parcel by the proportion
of the total width on the parcel owned by that property owner.
The amount of credit for which the property qualifies shall not
exceed 20 percent of the total gross tax on the parcel prior to
deduction of the state paid agricultural credit and the state
paid homestead credit, provided that, if the property containing
the right-of-way is included in a parcel which exceeds 40 acres,
the total gross tax on the parcel shall be multiplied by a
fraction, the numerator of which is the sum of the number of
acres in each quarter-quarter section or portion thereof which
contains a right-of-way and the denominator of which is the
total number of acres in the parcel set forth on the tax
statement, and the maximum credit shall be 20 percent of the
product of that computation, prior to deduction of those
credits. The auditor of the county in which the affected parcel
is located shall calculate the amount of the credit due for each
parcel and transmit that information to the county treasurer.
The county auditor, in computing the credits received pursuant
to sections 273.13 and 273.135, shall reduce the gross tax by
the amount of the credit received pursuant to this section,
unless the amount of the credit would be less than $10.
If, after the county auditor has computed the credit to
those qualifying property owners in unorganized townships, there
is money remaining in the utility property tax credit fund, then
that excess amount in the fund shall be returned to the general
school fund of the county.
Sec. 25. Minnesota Statutes 1985 Supplement, section
274.19, subdivision 1, is amended to read:
Subdivision 1. The provisions of subdivisions 1 to 7 apply
to manufactured homes that are assessed under subdivision 8,
clause (c). Each manufactured home shall be valued each year by
the assessor and be assessed with reference to its value on
January 2 of that year. Notice of the value shall be mailed to
the person to be assessed at least ten days before the meeting
of the local board of review or equalization. The notice shall
contain the amount of valuation in terms of market value, the
assessor's office address, and the date, place, and time set for
the meeting of the local board of review or equalization and the
county board of equalization.
Sec. 26. Minnesota Statutes 1985 Supplement, section
274.19, subdivision 8, is amended to read:
Subd. 8. [MANUFACTURED HOMES; SECTIONAL STRUCTURES.] (a)
For purposes of this section, a "manufactured home" means a
structure transportable in one or more sections, which is built
on a permanent chassis, and designed to be used as a dwelling
with or without a permanent foundation when connected to the
required utilities, and contains the plumbing, heating,
air-conditioning, and electrical systems therein, including any
accessory structure which is an addition or supplement to the
manufactured home and, when installed, becomes a part of the
manufactured home.
(b) A manufactured home which meets each of the following
criteria must be valued and assessed as an improvement to real
property, the appropriate real property classification shall
apply and the valuation is subject to review and the taxes
payable in the manner provided for real property:
(i) the owner of the unit holds title to the land upon
which it is situated;
(ii) the unit is affixed to the land by a permanent
foundation or is installed at its location in accordance with
the manufactured home building code contained in sections 327.31
to 327.34, and the rules adopted thereto, or is affixed to the
land in a manner comparable to other real property in the taxing
district; and
(iii) the unit is connected to public utilities, has a well
and septic tank system, or is serviced by water and sewer
facilities comparable to other real property in the taxing
district.
(c) A manufactured home which meets each of the following
criteria must be assessed at the rate provided by the
appropriate real property classification but must be classified
treated as a manufactured home personal property, and the
valuation is subject to review and the taxes payable thereon in
the manner provided in this section:
(i) the owner of the unit is a lessee of the land pursuant
to the terms of a lease;
(ii) the unit is affixed to the land by a permanent
foundation or is installed at its location in accordance with
the manufactured homes building code contained in sections
327.31 to 327.34, and the rules adopted thereto, or is affixed
to the land in a manner comparable to other real property in the
taxing district; and
(iii) the unit is connected to public utilities, has a well
and septic tank system, or is serviced by water and sewer
facilities comparable to other real property in the taxing
district.
(d) Sectional structures must be valued and assessed as an
improvement to real property if the owner of the structure holds
title to the land upon which it is located or is a qualifying
lessee of the land under the provisions of this section 273.19.
For purposes of this paragraph "sectional structure" means a
building or structural unit which has been in whole or
substantial part manufactured or constructed at an off site
location to be wholly or partially assembled on site alone or
with other units and attached to a permanent foundation.
(e) The commissioner of revenue may adopt rules pursuant to
the administrative procedure act for the purpose of establishing
additional criteria for the classification of manufactured homes
and sectional structures under this subdivision.
Sec. 27. Minnesota Statutes 1984, section 275.125,
subdivision 9, is amended to read:
Subd. 9. [LEVY REDUCTIONS; TACONITE.] (1) Reductions in
levies pursuant to subdivision 10 of this section, and section
273.138, shall be made prior to the reductions in clause (2).
(2) Notwithstanding any other law to the contrary,
districts which received payments pursuant to sections 294.21 to
294.26; 298.23 to 298.28; 298.34 to 298.39; 298.391 to 298.396;
298.405; 298.51 to 298.67; 477A.15; and any law imposing a tax
upon severed mineral values, or under any other law distributing
proceeds in lieu of ad valorem tax assessments on copper or
nickel properties, or recognized revenue pursuant to section
477A.15; shall not include a portion of these aids in their
permissible levies pursuant to those sections, but instead shall
reduce the permissible levies authorized by this section and
sections 124A.03, 124A.06, subdivision 3a, 124A.08, subdivision
3a, 124A.10, subdivision 3a, 124A.12, subdivision 3a, and
124A.14, subdivision 5a by the greater of the following:
(a) an amount equal to 50 percent of the total dollar
amount of the payments received pursuant to those sections or
revenue recognized pursuant to section 477A.15 in the previous
fiscal year; or
(b) an amount equal to the total dollar amount of the
payments received pursuant to those sections or revenue
recognized pursuant to section 477A.15 in the previous fiscal
year less the product of the same dollar amount of payments or
revenue times the ratio of the maximum levy allowed the district
under section 124A.03, subdivision 1, to the total levy allowed
the district under this section and sections 124A.03, 124A.06,
subdivision 3a, 124A.08, subdivision 3a, 124A.10, subdivision
3a, 124A.12, subdivision 3a, and 124A.14, subdivision 5a in the
year in which the levy is certified.
(3) No reduction pursuant to this subdivision shall reduce
the levy made by the district pursuant to section 124A.03,
subdivision 1, to an amount less than the amount raised by a
levy of 12.5 mills times the adjusted assessed valuation of that
district for the preceding year as determined by the
equalization aid review committee. The amount of any increased
levy authorized by referendum pursuant to section 124A.03,
subdivision 2 shall not be reduced pursuant to this
subdivision. The amount of any levy authorized by subdivision
4, to make payments for bonds issued and for interest thereon,
shall not be reduced pursuant to this subdivision.
(4) Before computing the reduction pursuant to this
subdivision of the capital expenditure levy authorized by
subdivision 11a, and the community service levy authorized by
subdivision 8, the commissioner shall ascertain from each
affected school district the amount it proposes to levy for
capital expenditures pursuant to subdivision 11a and for
community services pursuant to subdivision 8. The reduction of
the capital expenditure levy and the community services levy
shall be computed on the basis of the amount so ascertained.
(5) Notwithstanding any law to the contrary, any amounts
received by districts in any fiscal year pursuant to sections
294.21 to 294.26; 298.23 to 298.28; 298.34 to 298.39; 298.391 to
298.396; 298.405; 298.51 to 298.67; or any law imposing a tax on
severed mineral values, or under any other law distributing
proceeds in lieu of ad valorem tax assessments on copper or
nickel properties; and not deducted from foundation aid pursuant
to section 124A.035, subdivision 5, clause (2), and not applied
to reduce levies pursuant to this subdivision shall be paid by
the district to the commissioner of finance St. Louis county
auditor in the following amount by March 15 of each year except
1986, the amount required to be subtracted from the previous
fiscal year's foundation aid pursuant to section 124A.035,
subdivision 5, which is in excess of the foundation aid earned
for that fiscal year. The commissioner of finance county
auditor shall deposit any amounts received pursuant to this
clause in the taconite property tax relief fund in the state
treasury, established pursuant to section 16A.70 St. Louis
county treasury for purposes of paying the taconite homestead
credit as provided in section 273.135.
Sec. 28. Minnesota Statutes 1984, section 276.09, is
amended to read:
276.09 [SETTLEMENT BETWEEN AUDITOR AND TREASURER.]
On the fifth day of March and the 20th day of May, and
October of each year, the county treasurer shall make full
settlement with the county auditor of all receipts collected by
him for all purposes, from the date of the last settlement up to
and including each day mentioned. The county auditor shall,
within 30 days after each settlement, send an abstract of same
to the state auditor in the form prescribed by the state
auditor. At each settlement the treasurer shall make complete
returns of the receipts on the current tax list, showing the
amount collected on account of the several funds included in the
list.
Settlement of receipts from May 20 to December 31 of each
year shall be made as provided in section 31.
For purposes of this section, "receipts" shall include all
tax payments received by the county treasurer on or before the
settlement date.
Sec. 29. Minnesota Statutes 1984, section 276.10, is
amended to read:
276.10 [APPORTIONMENT AND DISTRIBUTION OF FUNDS.]
On the settlement day in March, and May, and October of
each year, the county auditor and county treasurer shall
distribute all undistributed funds in the treasury, apportioning
them, as provided by law, and placing them to the credit of the
state, town, city, school district, special district and each
county fund. Within 20 days after the distribution is
completed, the county auditor shall make a report of it to the
state auditor in the form prescribed by the state auditor. The
county auditor shall issue his warrant for the payment of moneys
in the county treasury to the credit of the state, town, city,
school district, or special districts on application of the
persons entitled to receive them. The county auditor may apply
the mill rate from the year previous to the year of distribution
when apportioning and distributing delinquent tax proceeds,
provided that the composition of the previous year's mill rate
between taxing districts is not significantly different than
that which existed for the year of the delinquency.
Sec. 30. Minnesota Statutes 1984, section 276.11, is
amended to read:
276.11 [WHEN TREASURER SHALL PAY FUNDS FROM MARCH AND MAY
SETTLEMENTS.]
As soon as practical after each settlement the March and
May settlements the county treasurer shall pay over to the state
treasurer or the treasurer of any town, city, school district,
or special district, on the warrant of the county auditor, all
receipts arising from taxes levied by and belonging to the
state, or to such municipal corporation, or other body, and
deliver up all orders and other evidences of indebtedness of
such municipal corporation or other body, taking triplicate
receipts therefor. The treasurer shall file one of the receipts
with the county auditor, and shall return one by mail on the day
of its reception to the clerk of the town, city, school
district, or special district to which payment was made. The
clerk shall preserve the receipt in the clerk's office. Upon
written request of the state, a municipal corporation or other
public body, the county treasurer shall, to the extent
practicable, make partial payments of amounts collected
periodically in advance of the next settlement and
distribution. Accompanying each payment shall be a statement
prepared by the county treasurer designating the years for which
taxes included in the payment were collected and, for each year,
the amount of the taxes and any penalties thereon. The county
treasurer shall pay, upon written request of the state, a
municipal corporation or other public body except school
districts, at least 70 percent of the estimated collection
within 30 days after the March and May settlement date dates.
Within seven business days after the due date, the county
treasurer shall pay to the treasurer of the school districts 50
percent of the estimated collections arising from taxes levied
by and belonging to the school district and the remaining 50
percent of the estimated collections shall be paid to the
treasurer of the school district within the next seven business
days. The treasurer shall pay the balance of the amounts
collected to the state or to a municipal corporation or other
body within 60 days after the March and May settlement date
dates, provided, however, that after 45 days interest shall
accrue at a rate of eight percent per annum to the credit of and
shall be paid to the state, municipal corporation or other
body. Interest shall be payable upon appropriation from the
general revenue fund of the county and, if not paid, may be
recovered by the state, municipal corporation, or other body, in
a civil action.
Sec. 31. [276.111] [DISTRIBUTIONS AND FINAL YEAR-END
SETTLEMENT.]
Within seven business days after October 15, the county
treasurer shall pay to the school districts 50 percent of the
estimated collections arising from taxes levied by and belonging
to the school district from May 20 to October 20 and the
remaining 50 percent of the estimated tax collections must be
paid to the school district within the next seven business days.
Within ten business days after November 15, the county treasurer
shall pay to the school district 100 percent of the estimated
collections arising from taxes levied by and belonging to the
school districts from October 20 to November 20.
Within ten business days after November 15, the county
treasurer shall pay to each taxing district, except any school
district, 100 percent of the estimated collections arising from
taxes levied by and belonging to each taxing district from May
20 to November 20.
On or before the fifth day of January, the county treasurer
shall make full settlement with the county auditor of all
receipts collected from the 20th day of May to December 31.
After subtracting any tax distributions which have been made to
the taxing districts in October and November, the treasurer
shall pay to each of the taxing districts on or before January
25, the balance of the tax amounts collected on behalf of each
taxing district. Interest shall accrue at a rate of eight
percent per annum to the credit of and shall be paid to the
taxing district if this final settlement amount is not paid by
January 25. Interest shall be payable upon appropriation from
the general revenue fund of the county and, if not paid may be
recovered by the state, municipal corporation, or other body, in
a civil action.
Sec. 32. Minnesota Statutes 1984, section 278.03, is
amended to read:
278.03 [PAYMENT OF TAX.]
If the proceedings instituted by the filing of the petition
have not been completed before the 16th day of May next
following the filing, the petitioner shall pay to the county
treasurer 50 percent of the tax levied for such year against the
property involved, unless permission to continue prosecution of
the petition without such payment is obtained as herein
provided. If the proceedings instituted by the filing of the
petition have not been completed by the next October 16, or, in
the case of class 3cc agricultural homestead, class 3b
agricultural homestead, and class 3 agricultural nonhomestead
property, November 16, the petitioner shall pay to the county
treasurer 50 percent of the unpaid balance of the taxes levied
for the year against the property involved if the unpaid balance
is $2,000 or less and 80 percent of the unpaid balance if the
unpaid balance is over $2,000, unless permission to continue
prosecution of the petition without payment is obtained as
herein provided. The petitioner, upon ten days notice to the
county attorney and to the county auditor, given at least ten
days prior to the 16th day of May or the 16th day of
October, or, in the case of class 3cc agricultural homestead,
class 3b agricultural homestead, and class 3 agricultural
nonhomestead property, the 16th day of November, may apply to
the court for permission to continue prosecution of the petition
without payment; and, if it is made to appear
(1) That the proposed review is to be taken in good faith;
(2) That there is probable cause to believe that the
property may be held exempt from the tax levied or that the tax
may be determined to be less than 50 percent of the amount
levied; and
(3) That it would work a hardship upon petitioner to pay
the taxes due,
the court may permit the petitioner to continue prosecution
of the petition without payment, or may fix a lesser amount to
be paid as a condition of continuing the prosecution of the
petition.
Failure to make payment of the amount required when due
shall operate automatically to dismiss the petition and all
proceedings thereunder unless the payment is waived by an order
of the court permitting the petitioner to continue prosecution
of the petition without payment. The county treasurer shall,
upon request of the petitioner, issue duplicate receipts for the
tax payment, one of which shall be filed by the petitioner in
the proceeding.
Sec. 33. Minnesota Statutes 1985 Supplement, section
278.05, subdivision 5, is amended to read:
Subd. 5. Any time after the filing of the petition and
before the trial of the issues raised thereby, when the defense
or claim presented is that the property has been partially,
unfairly, or unequally assessed, or that the parcel has been
assessed at a valuation greater than its real or actual value,
or that a parcel which is classified as homestead under the
provisions of section 273.13, subdivision 22 or 23, has been
assessed at a valuation which exceeds by ten percent or more the
valuation which the parcel would have if it were valued at the
average assessment/sales ratio for real property in the same
class in that portion of the county in which the parcel is
located, for which the commissioner is able to establish and
publish a sales ratio study, the attorney representing the
state, county, city or town in the proceedings may serve on the
petitioner, or his attorney, and file with the clerk of the
district court, an offer to reduce the valuation of any tract or
tracts to a valuation set forth in the offer. If, within ten
days thereafter, the petitioner, or his attorney, gives notice
in writing to the county attorney, or the attorney for the city
or town, that the offer is accepted, he may file the offer with
proof of notice, and the clerk shall enter judgment
accordingly. Otherwise, the offer shall be deemed withdrawn and
evidence thereof shall not be given; and, unless a lower
valuation than specified in the offer is found by the court, no
costs or disbursements shall be allowed to the petitioner, but
the costs and disbursements of the state, county, city or town,
including interest at six percent on the tax based on the amount
of the offer from and after the 16th day of October, or, in the
case of class 3cc agricultural homestead, class 3b agricultural
homestead, and class 3 agricultural nonhomestead property, the
16th day of November, of the year the taxes are payable, shall
be taxed in its favor and included in the judgment and when
collected shall be credited to the county revenue fund, unless
the taxes were paid in full before the 16th day of October, or,
in the case of class 3cc agricultural homestead, class 3b
agricultural homestead, and class 3 agricultural nonhomestead
property, the 16th day of November, of the year in which the
taxes were payable, in which event interest shall not be taxable.
Sec. 34. Minnesota Statutes 1984, section 279.01, as
amended by Laws 1985, chapter 300, section 12, and First Special
Session chapter 14, article 4, section 82, is amended to read:
279.01 [DUE DATE; PENALTIES, INTEREST.]
Subdivision 1. Except as provided in subdivision 3, on May
16, of each year, with respect to property actually occupied and
used as a homestead by the owner of the property, a penalty of
three percent shall accrue and thereafter be charged upon all
unpaid taxes on real estate on the current lists in the hands of
the county treasurer, and a penalty of seven percent on
nonhomestead property, except that this penalty shall not accrue
until June 1 of each year on commercial use real property used
for seasonal residential recreational purposes and classified as
class 1c, 2c, or 6a, and on other commercial use real property
classified as class 3a, provided that over 60 percent of the
gross income earned by the enterprise on the class 3a property
is earned during the months of May, June, July, and August. Any
property owner of such class 3a property who pays the first half
of the tax due on the property after May 15 and before June 1
shall attach an affidavit to his payment attesting to compliance
with the income provision of this subdivision. Thereafter, for
both homestead and nonhomestead property, on the 16th day of
each month, up to and including October 16 following, an
additional penalty of one percent for each month shall accrue
and be charged on all such unpaid taxes. When the taxes against
any tract or lot exceed $50, one-half thereof may be paid prior
to May 16; and, if so paid, no penalty shall attach; the
remaining one-half shall be paid at any time prior to October 16
following, without penalty; but, if not so paid, then a penalty
of four percent shall accrue thereon for homestead property and
a penalty of four percent on nonhomestead property. Thereafter,
for homestead property, on the 16th day of each month up to and
including December 16 following, an additional penalty of two
percent for each month shall accrue and be charged on all such
unpaid taxes. Thereafter, for nonhomestead property, on the
16th day of each month up to and including December 16
following, an additional penalty of four percent for each month
shall accrue and be charged on all such unpaid taxes. If
one-half of such taxes shall not be paid prior to May 16, the
same may be paid at any time prior to October 16, with accrued
penalties to the date of payment added, and thereupon no penalty
shall attach to the remaining one-half until October 16
following; provided, also, that the same may be paid in
installments as follows: One-fourth prior to March 16;
one-fourth prior to May 16; one-fourth prior to August 16; and
the remaining one-fourth prior to October 16, subject to the
aforesaid penalties. Where the taxes delinquent after October
16 against any tract or parcel exceed $100, upon resolution of
the county board, they may be paid in installments of not less
than 25 percent thereof, together with all accrued penalties and
costs, up to the next tax judgment sale, and after such payment,
penalties, interest, and costs shall accrue only on the sum
remaining unpaid. Any county treasurer who shall make out and
deliver or countersign any receipt for any such taxes without
including all of the foregoing penalties therein, shall be
liable to the county for the amount of such penalties.
Subd. 2. In the case of any tax on class 3cc, 3b, and 3c
homestead property paid within 30 days after the due date
specified in this section or after the 30-day extension as
specified in subdivision 3, the county board may, with the
concurrence of the county treasurer, delegate to the county
treasurer the power to abate the penalty provided for late
payment. Notwithstanding section 270.07, if any county board so
elects, the county treasurer may abate the penalty if in his
judgment the imposition of the penalty would be unjust and
unreasonable.
Subd. 3. In the case of class 3cc agricultural homestead,
class 3b agricultural homestead property, and class 3
agricultural nonhomestead property, no penalties shall attach to
the second one-half property tax payment as provided in this
section if paid by November 15. Thereafter for class 3cc
agricultural homestead and class 3b homestead property, on
November 16 following, a penalty of six percent shall accrue and
be charged on all such unpaid taxes and on December 16
following, an additional two percent shall be charged on all
such unpaid taxes. Thereafter for class 3 agricultural
nonhomestead property, on November 16 following, a penalty of
eight percent shall accrue and be charged on all such unpaid
taxes and on December 16 following, an additional four percent
shall be charged on all such unpaid taxes.
If the owner of class 3cc agricultural homestead, class 3b,
or class 3 agricultural property receives a consolidated
property tax statement that shows only an aggregate of the taxes
and special assessments due on that property and on other
property not classified as class 3cc agricultural homestead,
class 3b, or class 3 agricultural property, the aggregate tax
and special assessments shown due on the property by the
consolidated statement will be due on November 15 provided that
at least 50 percent of the property's market value is classified
class 3cc agricultural, class 3b, or class 3 agricultural.
Sec. 35. Minnesota Statutes 1985 Supplement, section
279.06, is amended to read:
279.06 [COPY OF LIST AND NOTICE.]
Within five days after the filing of such list, the clerk
shall return a copy thereof to the county auditor, with a notice
prepared and signed by him, and attached thereto, which may be
substantially in the following form:
State of Minnesota )
) ss.
County of ............... )
District Court
.......... Judicial District.
The state of Minnesota, to all persons, companies, or
corporations who have or claim any estate, right, title, or
interest in, claim to, or lien upon, any of the several parcels
of land described in the list hereto attached:
The list of taxes and penalties on real property for the
county of ............................... remaining delinquent
on the first Monday in January, 19....., has been filed in the
office of the clerk of the district court of said county, of
which that hereto attached is a copy. Therefore, you, and each
of you, are hereby required to file in the office of said clerk,
on or before the 20th day after the publication of this notice
and list, your answer, in writing, setting forth any objection
or defense you may have to the taxes, or any part thereof, upon
any parcel of land described in the list, in, to, or on which
you have or claim any estate, right, title, interest, claim, or
lien, and, in default thereof, judgment will be entered against
such parcel of land for the taxes on such list appearing against
it, and for all penalties, interest, and costs. Based upon said
judgment, the land shall be sold to the state of Minnesota on
the second Monday in May, 19... The period of redemption for
all lands sold to the state at a tax judgment sale shall be
three years from the date of sale to the state of Minnesota if
the land is within an incorporated area unless it is: (a)
nonagricultural homesteaded land as defined in section 273.13,
subdivision 22; (b) homesteaded agricultural land as defined in
section 273.13, subdivision 23, paragraph (a); or (c) seasonal
recreational land as defined in section 273.13, subdivision 22,
paragraph (c) or subdivision 27, paragraph (a), in which event
the period of redemption is five years from the date of sale to
the state of Minnesota.
The period of redemption for all other lands sold to the
state at a tax judgment sale shall be five years from the date
of sale.
Inquiries as to the proceedings set forth above can be made
to the county auditor of ..... county whose address is ..... .
(Signed) ...............................,
Clerk of the District Court of the County
of ......................................
(Here insert list.)
The list referred to in the notice shall be substantially
in the following form:
List of real property for the county of
......................., on which taxes remain delinquent on the
first Monday in January, 19...:
Town of (Fairfield),
Township (40), Range (20),
Names (and
Current Filed
Addresses) for
the Taxpayers
and Fee Owners
and in Addition
Those Parties
Who Have Filed
Their Addresses Tax
Pursuant to Subdivision of Parcel Total Tax
section 276.041 Section Section Number and Penalty
$ cts.
John Jones S.E. 1/4 of S.W. 1/4 10 23101 2.20
(825 Fremont
Fairfield, MN
55000)
Bruce Smith That part of N.E. 1/4
(2059 Hand of S.W. 1/4 desc. as
Fairfield, follows: Beg. at the
MN 55000) S.E. corner of said
and N.E. 1/4 of S.W. 1/4;
Fairfield thence N. along the E.
State Bank line of said N.E. 1/4
(100 Main of S.W. 1/4 a distance
Street of 600 ft.; thence W.
Fairfield, parallel with the S.
MN 55000) line of said N.E. 1/4
of S.W. 1/4 a distance
of 600 ft.; thence S.
parallel with said E.
line a distance of 600
ft. to S. line of said
N.E. 1/4 of S.W. 1/4;
thence E. along said S.
line a distance of 600
ft. to the point of
beg. ............... 21 33211 3.15
As to platted property, the form of heading shall conform
to circumstances and be substantially in the following form:
City of (Smithtown)
Brown's Addition, or Subdivision
Names (and
Current Filed
Addresses) for
the Taxpayers
and Fee Owners
and in Addition
Those Parties
Who have Filed
Their Addresses Tax
Pursuant to Parcel Total Tax
section 276.041 Lot Block Number and Penalty
$ cts
John Jones 15 9 58243 2.20
(825 Fremont
Fairfield,
MN 55000)
Bruce Smith 16 9 58244 3.15
(2059 Hand
Fairfield,
MN 55000)
and
Fairfield
State Bank
(100 Main Street
Fairfield,
MN 55000)
The names, descriptions, and figures employed in
parentheses in the above forms are merely for purposes of
illustration.
The name of the town, township, range or city, and addition
or subdivision, as the case may be, shall be repeated at the
head of each column of the printed lists as brought forward from
the preceding column.
Errors in the list shall not be deemed to be a material
defect to affect the validity of the judgment and sale.
Sec. 36. Minnesota Statutes 1985 Supplement, section
287.12, is amended to read:
287.12 [TAXES, HOW APPORTIONED.]
All taxes paid to the county treasurer on or after July 1,
1985, under the provisions of sections 287.01 to 287.12 shall be
credited to the county revenue fund.
On or before the tenth day of each month the county
treasurer shall determine the receipts from the mortgage
registration tax during the preceding month. The treasurer
shall report to the county welfare agency on or before the tenth
day of each month 95 percent of the receipts attributable to the
statutory rate in section 287.05. That amount, in addition to
97 percent of the amount determined under section 287.29, must
be shown as a deduction from the report filed with the
department of human services as required by section 256.82. The
net receipts from the preceding month must be credited to the
county welfare fund by the tenth day of each month.
Sec. 37. Minnesota Statutes 1985 Supplement, section
287.29, subdivision 1, is amended to read:
Subdivision 1. On or before the tenth day of August 1985,
and each month thereafter, the county treasurer shall determine
and report to the county welfare agency the receipts
attributable to the tax imposed during the preceding month. The
report must accompany the report required in section 287.12.
The receipts shall be deposited in the county treasury and
credited to the county revenue fund. The net receipts from the
preceding month must be credited to the county welfare fund by
the tenth day of each month.
Sec. 38. Minnesota Statutes 1985 Supplement, section
290A.03, subdivision 6, is amended to read:
Subd. 6. [HOMESTEAD.] "Homestead" means the dwelling
occupied by a claimant as his principal residence and so much of
the land surrounding it, not exceeding ten acres, as is
reasonably necessary for use of the dwelling as a home and any
other property used for purposes of a homestead as defined in
section 273.13, subdivision 22, except for agricultural land
assessed as part of a homestead pursuant to section 273.13,
subdivision 23, "homestead" is limited to 320 acres or, where
the farm homestead is rented, one acre. The homestead may be
owned or rented and may be a part of a multidwelling or
multipurpose building and the land on which it is built. A
manufactured home, as defined in section 168.011 274.19,
subdivision 8, assessed as personal property may be a dwelling
for purposes of this subdivision.
Sec. 39. Minnesota Statutes 1985 Supplement, section
290A.03, subdivision 13, is amended to read:
Subd. 13. [PROPERTY TAXES PAYABLE.] "Property taxes
payable" means the property tax exclusive of special
assessments, penalties, and interest payable on a claimant's
homestead before reductions made pursuant to section 273.13,
subdivisions 22 and 23, but after deductions made pursuant to
sections 124.2137, 273.115, 273.116, 273.135, 273.1391, 273.42,
subdivision 2, and any other state paid property tax credits in
any calendar year. In the case of a claimant who makes ground
lease payments, "property taxes payable" includes the amount of
the payments directly attributable to the property taxes
assessed against the parcel on which the house is located. No
apportionment or reduction of the "property taxes payable" shall
be required for the use of a portion of the claimant's homestead
for a business purpose if the claimant does not deduct any
business depreciation expenses for the use of a portion of the
homestead in the determination of federal adjusted gross
income. For homesteads which are manufactured homes as defined
in section 168.011 274.19, subdivision 8, "property taxes
payable" shall also include the amount of the gross rent paid in
the preceding year for the site on which the homestead is
located, which is attributable to the net tax paid on the site.
The amount attributable to property taxes shall be determined by
multiplying the net tax on the parcel by a fraction, the
numerator of which is the gross rent paid for the calendar year
for the site and the denominator of which is the gross rent paid
for the calendar year for the parcel. When a homestead is owned
by two or more persons as joint tenants or tenants in common,
such tenants shall determine between them which tenant may claim
the property taxes payable on the homestead. If they are unable
to agree, the matter shall be referred to the commissioner of
revenue and his decision shall be final. Property taxes are
considered payable in the year prescribed by law for payment of
the taxes.
In the case of a claim relating to "property taxes
payable," the claimant must have owned and occupied the
homestead on January 2 of the year in which the tax is payable
and (i) the property must have been classified as homestead
property pursuant to section 273.13, subdivision 22 or 23 on or
before June 1 of the year in which the "property taxes payable"
were levied; or (ii) the claimant must provide documentation
from the local assessor that application for homestead
classification has been made prior to October 1 of the year in
which the "property taxes payable" were payable and that the
assessor has approved the application.
Sec. 40. Minnesota Statutes 1984, section 296.16,
subdivision 1, is amended to read:
Subdivision 1. [INTENT.] All gasoline received in this
state and all gasoline produced in or brought into this state
except aviation gasoline and marine gasoline shall be determined
to be intended for use in motor vehicles in this state.
Approximately three-fourths of one percent of all gasoline
received in this state and three-fourths of one percent of all
gasoline produced or brought into this state, except gasoline
used for aviation purposes, is being used as fuel for the
operation of motor boats on the waters of this state and of the
total revenue derived from the imposition of the gasoline fuel
tax for uses other than in motor boats for aviation purposes,
three-fourths of one percent of such revenues is the amount of
tax on fuel used in motor boats operated on the waters of this
state. Approximately three-fourths of one percent of all
gasoline received in and produced or brought into this state,
except gasoline used for aviation purposes, is being used as
fuel for the operation of snowmobiles in this state, and of the
total revenue derived from the imposition of the gasoline fuel
tax for uses other than in snowmobiles for aviation purposes,
three-fourths of one percent of such revenues is the amount of
tax on fuel used in snowmobiles operated in this state.
Sec. 41. Minnesota Statutes 1984, section 296.17,
subdivision 6, is amended to read:
Subd. 6. [RECIPROCAL AGREEMENTS.] The commissioner is
hereby empowered to of public safety or the commissioner of
revenue may enter into reciprocal agreements with the
appropriate officials of any other state under which he either
commissioner may waive all or any part of the requirements
imposed by this section upon those who use in Minnesota gasoline
or other motor vehicle fuel upon which the tax has been paid to
such other state, provided that the officials of such other
state grant equivalent privileges with respect to gasoline or
other motor vehicle fuel used in such other state but upon which
the tax has been paid to Minnesota.
The commissioner is also hereby empowered to of public
safety or the commissioner of revenue may enter into reciprocal
agreements with the appropriate officials of other states,
exempting vehicles licensed in such other states from the
license and use tax provisions contained in this section, which
otherwise would apply to vehicles licensed by such other state,
provided that such other state grant equivalent privileges with
respect to vehicles licensed by Minnesota.
Sec. 42. Minnesota Statutes 1984, section 296.17, is
amended by adding a subdivision to read:
Subd. 9a. [MINNESOTA BASED INTERSTATE CARRIERS.]
Notwithstanding the exemption contained in subdivision 9, as the
commissioner of public safety enters into interstate fuel tax
compacts which require base state licensing and filing and which
eliminate filing in the nonresident compact states, the
Minnesota based motor vehicles registered pursuant to section
168.187 will be required to license under the fuel tax compact
in Minnesota.
The commissioner of public safety will have all the powers
granted to the commissioner of revenue under this section,
including the authority to collect and issue licenses, to
collect the tax due, and issue any refunds. All license fees
paid to the commissioner of public safety pursuant to
subdivision 10 will be deposited in the general fund.
Sec. 43. Minnesota Statutes 1984, section 298.24,
subdivision 1, is amended to read:
Subdivision 1. (a) There is hereby imposed upon taconite
and iron sulphides, and upon the mining and quarrying thereof,
and upon the production of iron ore concentrate therefrom, and
upon the concentrate so produced, a tax of $1.25 cents per gross
ton of merchantable iron ore concentrate produced therefrom.
The tax on concentrates produced in 1978 and subsequent years
prior to 1985 shall be equal to $1.25 multiplied by the steel
mill products index during the production year, divided by the
steel mill products index in 1977. The index stated in code
number 1013, or any subsequent equivalent, as published by the
United States Department of Labor, Bureau of Labor Statistics
Wholesale Prices and Price Indexes for the month of January of
the year in which the concentrate is produced shall be the index
used in calculating the tax imposed herein. In no event shall
the tax be less than $1.25 per gross ton of merchantable iron
ore concentrate. The tax on concentrates produced in 1985 and
1986 shall be at the rate determined for 1984 production. For
concentrates produced in 1987 and subsequent years, the tax
shall be equal to the preceding year's tax plus an amount equal
to the preceding year's tax multiplied by the percentage
increase in the implicit price deflator from the fourth quarter
of the second preceding year to the fourth quarter of the
preceding year. "Implicit price deflator" means the implicit
price deflator for the gross national product prepared by the
bureau of economic analysis of the United States department of
commerce.
(b) On concentrates produced in 1984, an additional tax is
imposed equal to eight-tenths of one percent of the total tax
imposed by clause (a) per gross ton for each one percent that
the iron content of such product exceeds 62 percent, when dried
at 212 degrees Fahrenheit.
(c) The tax imposed by this subdivision on concentrates
produced in 1984 shall be computed on the production for the
current year. The tax on concentrates produced in 1985 shall be
computed on the average of the production for the current year
and the previous year. The tax on concentrates produced in 1986
and thereafter shall be the average of the production for the
current year and the previous two years. The rate of the tax
imposed will be the current year's tax rate. This clause shall
not apply in the case of the closing of a taconite facility if
the property taxes on the facility would be higher if this
clause and section 298.25 were not applicable.
(d) If the tax or any part of the tax imposed by this
subdivision is held to be unconstitutional, a tax of $1.25 per
gross ton of merchantable iron ore concentrate produced shall be
imposed.
Sec. 44. Minnesota Statutes 1985 Supplement, section
298.28, subdivision 1, is amended to read:
Subdivision 1. [DISTRIBUTION.] The proceeds of the taxes
collected under section 298.24, except the tax collected under
section 298.24, subdivision 2, shall, upon certification of the
commissioner of revenue, be allocated as follows:
(1) 2.5 cents per gross ton of merchantable iron ore
concentrate, hereinafter referred to as "taxable ton," to the
city or town in the county in which the lands from which
taconite was mined or quarried were located or within which the
concentrate was produced. If the mining, quarrying, and
concentration, or different steps in either thereof are carried
on in more than one taxing district, the commissioner shall
apportion equitably the proceeds of the part of the tax going to
cities and towns among such subdivisions upon the basis of
attributing 40 percent of the proceeds of the tax to the
operation of mining or quarrying the taconite, 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 such operations
performed in each such taxing district. His order making such
apportionment shall be subject to review by the tax court at the
instance of any of the interested taxing districts, in the same
manner as other orders of the commissioner.
(2) (a) 12.5 cents per taxable ton, less any amount
distributed under clause (7), paragraph (a), and paragraph (b)
of this clause, to be distributed as provided in section 298.282.
(b) An amount annually certified by the county auditor of a
county containing a taconite tax relief area within which there
is an organized township if, as of January 2, 1982, more than 75
percent of the assessed valuation of the township consists of
iron ore. The amount will be the portion of a township's
certified levy equal to the proportion of (1) the difference
between 50 percent of the township's January 2, 1982, assessed
value and its current assessed value to (2) the sum of its
current assessed value plus the difference determined in (1).
The county auditor shall extend the township's levy against the
sum of the township's current assessed value plus the difference
between 50 percent of its January 2, 1982, assessed value and
its current assessed value. If the current assessed value of
the township exceeds 50 percent of the township's January 2,
1982, assessed value, this clause shall not apply.
(3) 29 cents per taxable ton plus the increase provided in
paragraph (c) to qualifying school districts to be distributed,
based upon the certification of the commissioner of revenue, as
follows:
(a) Six cents per taxable ton to the school districts in
which the lands from which taconite was mined or quarried were
located or within which the concentrate was produced. The
distribution must be based on the apportionment formula
prescribed in clause (1).
(b) 23 cents per taxable ton, less any amount distributed
under part (d), shall be distributed to a group of school
districts comprised of those school districts wherein the
taconite was mined or quarried or the concentrate produced or in
which there is a qualifying municipality as defined by section
273.134 in direct proportion to school district tax levies as
follows: each district shall receive that portion of the total
distribution which its certified levy for the prior year,
computed pursuant to sections 124A.03, 124A.06, subdivision 3a,
124A.08, subdivision 3a, 124A.10, subdivision 3a, 124A.12,
subdivision 3a, 124A.14, subdivision 5a, and 275.125, comprises
of the sum of certified levies for the prior year for all
qualifying districts, computed pursuant to sections 124A.03,
124A.06, subdivision 3a, 124A.08, subdivision 3a, 124A.10,
subdivision 3a, 124A.12, subdivision 3a, 124A.14, subdivision
5a, and 275.125. For purposes of distributions pursuant to this
part, certified levies for the prior year computed pursuant to
sections 124A.03, 124A.06, subdivision 3a, 124A.08, subdivision
3a, 124A.10, subdivision 3a, 124A.12, subdivision 3a, 124A.14,
subdivision 5a, and 275.125 shall not include the amount of any
increased levy authorized by referendum pursuant to section
124A.03, subdivision 2.
(c) On July 15, in years prior to 1988, an amount equal to
the increase derived by increasing the amount determined by
clause (3)(b) in the same proportion as the increase in the
steel mill products index over the base year of 1977 as provided
in section 298.24, subdivision 1, clause (a), shall be
distributed to any school district described in clause (3)(b)
where a levy increase pursuant to section 124A.03, subdivision
2, is authorized by referendum, according to the following
formula. On July 15, 1988 and subsequent years, the increase
over the amount established for the prior year shall be
determined according to the increase in the implicit price
deflator as provided in section 298.24, subdivision 1, paragraph
(a). Each district shall receive the product of:
(i) $150 times the pupil units identified in section
124.17, subdivision 1, clauses (1) and (2), enrolled in the
second previous year or the 1983-1984 school year, whichever is
greater, less the product of 1-3/4 mills times the district's
taxable valuation in the second previous year; times
(ii) the lesser of:
(A) one, or
(B) the ratio of the amount certified pursuant to section
124A.03, subdivision 2, in the previous year, to the product of
1-3/4 mills times the district's taxable valuation in the second
previous year.
If the total amount provided by clause (3)(c) is
insufficient to make the payments herein required then the
entitlement of $150 per pupil unit shall be reduced uniformly so
as not to exceed the funds available. Any amounts received by a
qualifying school district in any fiscal year pursuant to clause
(3)(c) shall not be applied to reduce foundation aids which the
district is entitled to receive pursuant to section 124A.02 or
the permissible levies of the district. Any amount remaining
after the payments provided in this paragraph shall be paid to
the commissioner of iron range resources and rehabilitation who
shall deposit the same in the taconite environmental protection
fund and the northeast Minnesota economic protection trust fund
as provided in clause (9).
(d) There shall be distributed to any school district the
amount which the school district was entitled to receive under
section 298.32 in 1975.
(4) 19.5 cents per taxable ton to counties to be
distributed, based upon certification by the commissioner of
revenue, as follows:
(a) 15.5 cents per taxable ton shall be distributed to the
county in which the taconite is mined or quarried or in which
the concentrate is produced, less any amount which is to be
distributed pursuant to part (b). The apportionment formula
prescribed in clause (1) is the basis for the distribution.
(b) If an electric power plant owned by and providing the
primary source of power for a taxpayer mining and concentrating
taconite is located in a county other than the county in which
the mining and the concentrating processes are conducted, one
cent per taxable ton of the tax distributed to the counties
pursuant to part (a) and imposed on and collected from such
taxpayer shall be paid to the county in which the power plant is
located.
(c) Four cents per taxable ton shall be paid to the county
from which the taconite was mined, quarried or concentrated to
be deposited in the county road and bridge fund. If the mining,
quarrying and concentrating, or separate steps in any of those
processes are carried on in more than one county, the
commissioner shall follow the apportionment formula prescribed
in clause (1).
(5) (a) 17.75 cents per taxable ton, less any amount
required to be distributed under part (b), to St. Louis county
acting as the counties' fiscal agent, to be distributed as
provided in sections 273.134 to 273.136.
(b) If an electric power plant owned by and providing the
primary source of power for a taxpayer mining and concentrating
taconite is located in a county other than the county in which
the mining and the concentrating processes are conducted, .75
cent per taxable ton of the tax imposed and collected from such
taxpayer shall be paid to the county and school district in
which the power plant is located as follows: 25 percent to the
county and 75 percent to the school district.
(6) Three cents per taxable ton shall be paid to the iron
range resources and rehabilitation board for the purposes of
section 298.22. The amount determined in this clause shall be
increased in 1981 and subsequent years prior to 1988 in the same
proportion as the increase in the steel mill products index as
provided in section 298.24, subdivision 1 and shall be increased
in 1988 and subsequent years according to the increase in the
implicit price deflator as provided in section 298.24,
subdivision 1. The amount distributed pursuant to this clause
shall be expended within or for the benefit of a tax relief area
defined in section 273.134. No part of the fund provided in
this clause may be used to provide loans for the operation of
private business unless the loan is approved by the governor and
the legislative advisory commission.
(7) (a) .20 cent per taxable ton shall be paid to the range
association of municipalities and schools, for the purpose of
providing an areawide approach to problems which demand
coordinated and cooperative actions and which are common to
those areas of northeast Minnesota affected by operations
involved in mining iron ore and taconite and producing
concentrate therefrom, and for the purpose of promoting the
general welfare and economic development of the cities, towns
and school districts within the iron range area of northeast
Minnesota.
(b) 1.5 cents per taxable ton shall be paid to the
northeast Minnesota economic protection trust fund.
(8) the amounts determined under clauses (4)(a), (4)(c),
(5), and (7)(b) shall be increased in 1979 and subsequent years
prior to 1988 in the same proportion as the increase in the
steel mill products index as provided in section 298.24,
subdivision 1. Those amounts shall be increased in 1988 and
subsequent years in the same proportion as the increase in the
implicit price deflator as provided in section 298.24,
subdivision 1.
(9) the proceeds of the tax imposed by section 298.24 which
remain after the distributions and payments in clauses (1) to
(8), as certified by the commissioner of revenue, and parts (a)
and (b) of this clause have been made, together with interest
earned on all money distributed under this subdivision prior to
distribution, shall be divided between the taconite
environmental protection fund created in section 298.223 and the
northeast Minnesota economic protection trust fund created in
section 298.292 as follows: Two-thirds to the taconite
environmental protection fund and one-third to the northeast
Minnesota economic protection trust fund. The proceeds shall be
placed in the respective special accounts.
(a) There shall be distributed to each city, town, school
district, and county the amount that they received under section
294.26 in calendar year 1977; provided, however, that the amount
distributed in 1981 to the unorganized territory number 2 of
Lake county and the town of Beaver Bay based on the
between-terminal trackage of Erie Mining Company will be
distributed in 1982 and subsequent years to the unorganized
territory number 2 of Lake county and the towns of Beaver Bay
and Stony River based on the miles of track of Erie Mining
Company in each taxing district.
(b) There shall be distributed to the iron range resources
and rehabilitation board the amounts it received in 1977 under
section 298.22. The amount distributed under this subclause (b)
shall be expended within or for the benefit of the tax relief
area defined in section 273.134.
On or before October 10 of each calendar year each producer
of taconite or iron sulphides subject to taxation under section
298.24 (hereinafter called "taxpayer") shall file with the
commissioner of revenue an estimate of the amount of tax which
would be payable by such taxpayer under said law for such
calendar year; provided such estimate shall be in an amount not
less than the amount due on the mining and production of
concentrates up to September 30 of said year plus the amount
becoming due because of probable production between September 30
and December 31 of said year, less any credit allowable as
hereinafter provided. The commissioner of revenue shall
annually on or before October 10 report an estimated
distribution amount to each taxing district and the officers
with whom such report is so filed shall use the amount so
indicated as being distributable to each taxing district in
computing the permissible tax levy of such county or city in the
year in which such estimate is made, and payable in the next
ensuing calendar year, except that one cent per taxable ton of
the amount distributed under clause (4)(c) shall not be deducted
in calculating the permissible levy. In any calendar year in
which a general property tax levy subject to sections 275.50 to
275.59 275.58 has been made, if the taxes distributable to any
such county or city are greater than the amount estimated by the
commissioner to be paid to any such county or city in such year,
the excess of such distribution shall be held in a special fund
by the county or city and shall not be expended until the
succeeding calendar year, and shall be included in computing the
permissible levies under sections 275.50 to 275.59 275.58, of
such county or city payable in such year. If the amounts
distributable to any such county or city after final
determination by the commissioner of revenue under this section
are less than the amounts by which a taxing district's levies
were reduced pursuant to this section, such county or city may
issue certificates of indebtedness in the amount of the
shortage, and may include in its next tax levy, in excess of the
limitations of sections 275.50 to 275.59 275.58 an amount
sufficient to pay such certificates of indebtedness and interest
thereon, or, if no certificates were issued, an amount equal to
such shortage.
Sec. 45. [REPORT ON SALES RATIO STUDY.]
The department of revenue shall study alternative means of
calculating the assessment/sales ratio for communities in which
few sales occur and report its findings and recommendations to
the legislature by January 15, 1987.
Sec. 46. Laws 1985, chapter 289, section 5, subdivision 2,
is amended to read:
Subd. 2. [REVERSE REFERENDUM.] If the Clearwater county
board proposes to increase the levy of the county pursuant to
subdivision 1, it shall pass a resolution stating that fact.
Thereafter, the resolution shall be published for two successive
weeks in the official newspaper of the county or if there is no
official newspaper, in a newspaper of general circulation in the
county, together with a notice fixing a date for a public
hearing on the matter. The hearing shall be held not less than
two weeks nor more than four weeks after the first publication
of the resolution. Following the public hearing, the county may
determine to take no further action or, in the alternative,
adopt a resolution confirming its intention to exercise the
authority. That resolution shall also be published in the
official newspaper of the county or if there is no official
newspaper, in a newspaper of general circulation in the county.
If within 30 days thereafter a petition signed by voters equal
in number to five percent of the votes cast in the county in the
last general election requesting a referendum on the proposed
resolution is filed with the county auditor the resolution shall
not be effective until it has been submitted to the voters at a
general or special election and a majority of votes cast on the
question of approving the resolution are in the affirmative.
The commissioner of revenue shall prepare a suggested form of
question to be presented at the referendum. The referendum must
be held at a special or general election prior to October 1,
1985 of the year when a tax is initially proposed to be levied
pursuant to this section.
Sec. 47. Laws 1985, chapter 289, section 7, is amended to
read:
Sec. 7. [LOCAL APPROVAL.]
Sections 1, 2, 3, and 4 are effective the day after
compliance with Minnesota Statutes, section 645.021, subdivision
3, by the Hubbard county board. Section 5 is effective the day
after compliance with Minnesota Statutes, section 645.021,
subdivision 3, by the Clearwater county board for taxes levied
in 1985, 1986, 1987, and 1988 and subsequent years. Section 6
is effective the day after compliance with Minnesota Statutes,
section 645.021, subdivision 3, by the Cass county board.
Sec. 48. [REPEALER.]
Minnesota Statutes 1984, section 69.031, subdivision 4, is
repealed.
Sec. 49. Laws 1985, First Special Session chapter 14,
article 11, section 13, is amended to read:
Sec. 13. [REPEALER.]
Minnesota Statutes 1984, sections 287.27, 287.29,
subdivision 3, and 287.32 are repealed.
Sec. 50. [EFFECT OF PRIOR ACTION.]
Notwithstanding Minnesota Statutes, section 645.36, the
repeal of Minnesota Statutes, section 287.27 by Laws 1985, First
Special Session chapter 14, article 11, section 13, is of no
effect, and section 287.27, remains in effect without
interruption. The amendment to section 287.27 by Laws 1985,
First Special Session chapter 14, article 11, section 8, takes
effect July 1, 1985.
Sec. 51. [INSTRUCTION TO THE REVISOR.]
In the next edition of Minnesota Statutes, the revisor
shall change class 3cc to class 1b, class 3b to class 2a, class
3 to class 2c, and class 3c to class 1a, wherever they appear in
sections 278.03, 278.05, subdivision 5, and 279.01.
Sec. 52. [EFFECTIVE DATES.]
Sections 1 to 6 and 48 are effective for police and fire
aids payable in 1986 and subsequent years. Sections 7, 9, 11 to
17, 19 to 26, 35, 38, and 39 are effective for property taxes
levied in 1986 and subsequent years, payable in 1987 and
subsequent years. Section 18 is effective July 15, 1986.
Section 27 is effective March 15, 1986. Sections 8, and 28 to
34 are effective for taxes paid in 1986 and subsequent years.
Sections 36, 37, 41, and 42 are effective July 1, 1986.
Sections 40, 43, 44, 46, and 47 are effective the day following
final enactment. Sections 49 and 50 are effective July 1, 1985.
ARTICLE 5
BUDGET RESERVE ACCOUNT AND CASH FLOW
Section 1. Minnesota Statutes 1985 Supplement, section
16A.15, subdivision 1, is amended to read:
Subdivision 1. [REDUCTION.] (a) If the commissioner
determines that probable receipts for the general fund will be
less than anticipated, and that the amount available for the
remainder of the biennium will be less than needed, the
commissioner shall, with the approval of the governor, and after
consulting the legislative advisory commission, transfer from
reduce the amount in the budget and cash flow reserve account
established in subdivision 6 to the general fund the money as
needed to balance expenditures with revenue. An additional
deficit shall, with the approval of the governor, and after
consulting the legislative advisory commission, be made up by
reducing allotments.
(b) If the commissioner determines that probable receipts
for any other fund, appropriation, or item will be less than
anticipated, and that the amount available for the remainder of
the term of the appropriation or for any allotment period will
be less than needed, the commissioner shall notify the agency
concerned and then reduce the amount allotted or to be allotted
so as to prevent a deficit.
(c) In reducing allotments, the commissioner may consider
other sources of revenue available to recipients of state
appropriations and may apply allotment reductions based on all
sources of revenue available.
(d) In like manner, the commissioner shall reduce
allotments to an agency by the amount of any saving that can be
made over previous spending plans through a reduction in prices
or other cause.
Sec. 2. Minnesota Statutes 1985 Supplement, section
16A.15, subdivision 6, is amended to read:
Subd. 6. [BUDGET AND CASH FLOW RESERVE ACCOUNT.] A budget
and cash flow reserve account is created in the general fund in
the state treasury. The commissioner of finance on July 1,
1983, shall transfer $250,000,000 to the account. The
commissioner of finance on July 1, 1984, shall transfer an
additional $125,000,000 to the account. The commissioner on
July 1, 1985, shall transfer an additional $75,000,000 to the
account shall, as authorized from time to time by law, restrict
part or all of the budgetary balance in the general fund for use
as the budget and cash flow reserve account. The
amounts transferred restricted shall remain in the account until
expended drawn down under subdivision 1. When an amount has
been expended under subdivision 1, but the commissioner later
determines during the same biennium that there will probably be
a positive undesignated balance in the general fund at the end
of the biennium, the commissioner shall transfer from the
undesignated fund balance to the budget and cash flow reserve
account the amount needed to restore the balance in the account
to $450,000,000.
Sec. 3. Minnesota Statutes 1985 Supplement, section
16A.1541, is amended to read:
16A.1541 [ADDITIONAL REVENUES; PRIORITY.]
If on the basis of a forecast of general fund revenues and
expenditures indicates the commissioner of finance determines
that there will be an unobligated a positive unrestricted
budgetary general fund balance at the close of the
biennium, money the commissioner of finance must be allocated
allocate money in the following order of priority:
(1) allocate an amount, if any, necessary to restore the
budget and cash flow reserve account as provided by section
16A.15, subdivision 6;
(2) pay the refund of occupation taxes under Laws 1985,
First Special Session chapter 14, article 18, section 7;
(3) (2) reduce property tax levy recognition percent under
section 121.904, subdivision 4c; and
(4) (3) increase the school aids payment current year
percentage under section 121.904, subdivision 4d.
The amounts necessary to meet the requirements of clauses
(1), (2), and (3) are appropriated from the general fund.
Sec. 4. Minnesota Statutes 1985 Supplement, section
121.904, subdivision 4c, is amended to read:
Subd. 4c. [PROPERTY TAX SHIFT REDUCTION.] (a) If the most
recent forecast of general fund revenues and expenditures
prepared by the commissioner of finance as of December 1
indicates a projected unobligated general fund balance at the
close of the biennium in excess of $10,000,000, Money made
available under section 16A.1541 must be used to reduce the levy
recognition percent specified in subdivision 4a, clauses (b)(2)
and (b)(3), shall be reduced for taxes payable in the succeeding
calendar year, according to the provisions of this subdivision
and section 16A.1541.
(b) The levy recognition percent shall equal the result of
the following computation: 24 the current levy recognition
percent, times the ratio of
(1) the statewide total amount of levy recognized in June
of the year in which the taxes are payable pursuant to
subdivision 4a, clause (b), reduced by the amount of the
projected general fund balance money made available under
section 16A.1541, to
(2) the statewide total amount of the levy recognized in
June of the year in which the taxes are payable pursuant to
subdivision 4a, clause (b).
The result shall be rounded up to the nearest whole percent.
However, in no case shall the levy recognition percent be
reduced below zero or increased above the current levy
recognition percent.
(c) The commissioner of finance must certify to the
commissioner of education the levy recognition percent computed
under this subdivision by January 5 of each year. The
commissioner of education must notify school districts of a
change in the levy recognition percent by January 15.
(d) The commissioner of finance shall transfer from the
general fund to the education aids appropriations specified by
the commissioner of education, the amounts needed to finance the
additional payments required because of the reduction pursuant
to this subdivision of the levy recognition percent. Payments
to a school district of additional state aids resulting from a
reduction in the levy recognition percent must be included in
the cash metering of payments made according to section 124.195
after January 15, and must be paid in a manner consistent with
the percent specified in that section.
Sec. 5. Minnesota Statutes 1985 Supplement, section
124.155, subdivision 2, is amended to read:
Subd. 2. [SUBTRACTION FROM ADJUSTMENT TO AIDS.] The amount
specified in Laws 1981, Third Special Session chapter 2, article
4, section 3, subdivision 2, as amended by Laws 1982, chapter
548, article 7, section 7, as further amended by Laws 1982,
Third Special Session chapter 1, article III, section 4 shall be
subtracted from the following state aids and credits in the
order listed in fiscal year 1983. The amount specified in
subdivision 1 shall be used to adjust the following state aids
and credits in the order listed:
(a) foundation aid as authorized defined in section
124.212, subdivision 1 124A.01;
(b) secondary vocational aid authorized in section 124.573;
(c) special education aid authorized in section 124.32;
(d) secondary vocational aid for handicapped children
authorized in section 124.574;
(e) gifted and talented aid authorized in section 124.247;
(f) aid for pupils of limited English proficiency
authorized in section 124.273;
(g) aid for chemical use programs authorized in section
124.246;
(h) interdistrict cooperation aid authorized in section
124.272;
(i) summer program aid authorized in section 124A.033;
(j) transportation aid authorized in section 124.225;
(i) (k) community education programs aid authorized in
section 124.271;
(j) (l) adult education aid authorized in section 124.26;
(m) early childhood family education aid authorized in
section 124.2711;
(k) (n) capital expenditure equalization aid authorized in
section 124.245;
(l) (o) homestead credit authorized in section 273.13,
subdivisions 22 and 23;
(p) state school agricultural tax credit aid authorized in
section 124.2137;
(m) (q) wetlands credit authorized in section 273.115;
(n) (r) native prairie credit authorized in section 273.116;
and
(o) (s) attached machinery aid authorized in section
273.138, subdivision 3; and
(t) teacher retirement and F.I.C.A. aid authorized in
sections 124.2162 and 124.2163.
The commissioner of education shall schedule the timing of
the reductions from state aids and credits specified in Laws
1981, Third Special Session chapter 2, article 4, section 3,
subdivision 2, as amended by Laws 1982, chapter 548, article 7,
section 7, as further amended by article III, section 4 of this
act, and the adjustments to state aids and credits specified in
subdivision 1, as close to the end of the fiscal year as
possible and in such a manner that will minimize the impact of
Laws 1981, Third Special Session chapter 2, article 4, as
amended, on the cash flow needs of the school districts.
Sec. 6. Minnesota Statutes 1984, section 124.195,
subdivision 3, is amended to read:
Subd. 3. [PAYMENT DATES AND PERCENTAGES.] Beginning in
fiscal year 1984 and thereafter, The commissioner of education
shall pay to a school district on the dates indicated an amount
computed as follows: the cumulative amount guaranteed minus the
sum of (a) the district's other district receipts through the
current payment, and (b) the aid and credit payments through the
immediately preceding payment. For purposes of this
computation, the payment dates and the cumulative disbursement
percentages are as follows:
Payment date Percentage
Payment 1 First business day prior to July 15: 2.25
Payment 2 First business day prior to July 30: 4.50
Payment 3 First business day prior to August 15: 6.75
Payment 4 First business day prior to August 30: 9.0
Payment 5 First business day prior to September 15: the
greater of (a) one-half of the final adjustment
for the prior fiscal year for the state paid
property tax credits established in section
273.1392, or (b) the amount needed to provide
12.75 percent
Payment 6 First business day prior to September 30: the
greater of (a) one-half of the final adjustment
for the prior fiscal year for the state paid
property tax credits established in section
273.1392, or (b) the amount needed to provide 16.5
percent
Payment 7 First business day prior to October 15: the
greater of (a) one-half of the final adjustment
for the prior fiscal year for all aid entitlements
except state paid property tax credits, or
(b) the amount needed to provide 20.75 percent
Payment 8 First business day prior to October 30: the
greater of (a) one-half of the final adjustment
for the prior fiscal year for all aid
entitlements except state paid property tax
credits, or (b) the amount needed to provide
25.0 percent
Payment 9 First business day prior to November 15: 31.0
Payment 10 First business day prior to November 30: 37.0
Payment 11 First business day prior to December 15: 40.0
Payment 12 First business day prior to December 30: 43.0
Payment 13 First business day prior to January 15: 47.25
Payment 14 First business day prior to January 30: 51.5
Payment 15 First business day prior to February 15: 56.0
Payment 16 First business day prior to February 28: 60.5
Payment 17 First business day prior to March 15: 65.25
Payment 18 First business day prior to March 30: 70.0
Payment 19 First business day prior to April 15: 74.0
73.0
Payment 20 First business day prior to April 30: 85.0
79.0
Payment 21 First business day prior to May 15: 92.0
82.0
Payment 22 First business day prior to May 30: 100.0
90.0
Payment 23 First business day prior to June 20: 100.0
Sec. 7. Minnesota Statutes 1984, section 124.195, is
amended by adding a subdivision to read:
Subd. 3a. [APPEAL.] The commissioner may revise the
payment dates and percentages in subdivision 3 and section 9 for
a district if it is determined that there is an emergency or
there are serious cash flow problems in the district that cannot
be resolved by issuing warrants or other forms of indebtedness.
The commissioner shall establish a process and criteria for
school districts to appeal the payment dates and percentages
established in subdivision 3 and section 9.
Sec. 8. [1987 BIENNIUM ADDITIONAL REVENUES; PRIORITY.]
Notwithstanding Minnesota Statutes 1985 Supplement, section
16A.1541, as amended by section 3, if on the basis of a forecast
of general fund revenues and expenditures the commissioner of
finance determines that there will be a positive unrestricted
budgetary general fund balance at the close of the biennium
ending June 30, 1987, money must be allocated in the following
order of priority:
(1) the first $100,000,000 must be restricted for use as
the budget and cash flow reserve account;
(2) one-half of any excess over $100,000,000 must be used
to restore the appropriation reductions to the state board of
vocational technical education, state board for community
colleges, state university board, and board of regents of the
University of Minnesota enacted by the 1986 legislature,
prorated among the boards in proportion to those appropriation
reductions, but not to exceed the amount of those appropriation
reductions;
(3) one-half of any excess over $100,000,000, and any
amount remaining after the application of clause (2), must be
used to restore the budget and cash flow reserve account to
$450,000,000; and
(4) any amount remaining after the application of clauses
(1), (2), and (3) shall be used as provided in section 3.
The amount necessary to meet the requirements of clause (2)
is appropriated from the general fund.
Sec. 9. [TEMPORARY CHANGE IN PAYMENT OF AIDS AND CREDITS
TO SCHOOL DISTRICTS.]
If the commissioner of finance determines that
modifications in the payment schedule are required to avoid
state short-term borrowing, the commissioner of education shall
modify payments to school districts according to this section.
The modifications shall begin no sooner than September 1, 1986,
and shall remain in effect until no later than May 30, 1987. In
calculating the payment to a school district pursuant to
Minnesota Statutes, section 124.195, subdivision 3, the
commissioner may subtract the sum specified in that subdivision,
plus an additional amount no greater than the following:
(1) the net cash balance in the district's four operating
funds on June 30, 1986; minus
(2) the product of $150 times the number of actual pupil
units in the 1985-1986 school year; minus
(3) the amount of payments made by the county treasurer
during fiscal year 1986, pursuant to Minnesota Statutes, section
276.11, which is considered revenue for the 1986-1987 school
year. However, no additional amount shall be subtracted if the
total of the net unappropriated fund balances in the district's
four operating funds on June 30, 1986, is less than the product
of $350 times the number of actual pupil units in the 1985-1986
school year. The net cash balance shall include all cash and
investments, less certificates of indebtedness outstanding, and
orders not paid for want of funds.
A district may appeal the payment schedule established by
this section according to the procedures established in section
7.
Sec. 10. [LIMITATION ON ALLOTMENT REDUCTION.]
Notwithstanding the provisions of Minnesota Statutes,
section 16A.15, subdivision 1, no allotment shall be reduced
before August 15, 1986, pursuant to an appropriation for state
aids, payments, or reimbursements to or on behalf of school
districts, or for aids to local governments authorized in
Minnesota Statutes, chapter 477A, or for property tax credits or
property tax relief authorized in Minnesota Statutes, chapter
273 or 290A. No allotment for these purposes shall be reduced
after August 15, 1986, unless reductions totaling at least
$85,000,000 have already been made from allotments pursuant to
other appropriations during calendar year 1986.
Sec. 11. [PAYMENT DELAYS.]
Notwithstanding any other law to the contrary, the
commissioner of finance may delay payment of any type of state
aids to local units of government, excluding school districts.
The commissioner may exercise the authority granted in this
section only to the extent necessary to avoid short-term
borrowing by the state. The delay may not extend beyond the end
of the fiscal year of the recipient.
Sec. 12. [REPEALER.]
(a) Minnesota Statutes 1984, section 124A.031, subdivision
2 is repealed.
(b) Minnesota Statutes 1985 Supplement, section 16A.154, is
repealed.
Sec. 13. [EFFECTIVE DATE.]
Sections 1, 2, 3, 4, 8, 10, 11, and 12, paragraph (b), are
effective the day following final enactment.
ARTICLE 6
LOCAL GOVERNMENT AIDS
Section 1. Minnesota Statutes 1985 Supplement, section
477A.011, subdivision 10, is amended to read:
Subd. 10. [MAXIMUM AID AMOUNT.] For any calendar year aid
distribution, a city's maximum aid amount shall be 106 104
percent of its previous year aid amount, provided that its
previous year aid amount exceeded $150 $200 per capita. If its
previous year aid amount was less than $150 $200 per capita, its
maximum aid amount shall be the lesser of: (a) 112 105.8
percent of its previous year aid amount, or (b) $159 $208
multiplied by the population figure used in determining its
previous year aid.
Sec. 2. Minnesota Statutes 1985 Supplement, section
477A.011, subdivision 14, is amended to read:
Subd. 14. [LOCAL EFFORT MILL RATE.] For any calendar year
aid distribution, a city's local effort mill rate means its
fiscal need factor per capita divided by $16 $17 per capita per
mill for the first $300 $350 of its fiscal need factor per
capita; plus its fiscal need factor per capita divided
by $14 $15 per capita per mill on that part of its fiscal need
factor per capita, if any, in excess of $300 $350. In no case
shall a city's local effort mill rate be less than eight mills.
Sec. 3. Minnesota Statutes 1985 Supplement, section
477A.012, is amended to read:
477A.012 [COUNTY GOVERNMENT DISTRIBUTIONS.]
In calendar year 1986 1987, each county government shall
receive a distribution equal to 60 104 percent of the aid amount
certified for 1983 1986 pursuant to sections 477A.011 to
477A.03. Each county government that received no distribution
in 1986 pursuant to sections 477A.011 to 477A.03 shall receive a
distribution in calendar year 1987 computed by multiplying the
county's population by a factor equal to the total increase in
aid certified to all other counties under this section in 1987
over the total amount certified in 1986, divided by the total
population of those counties.
Sec. 4. Minnesota Statutes 1985 Supplement, section
477A.013, is amended to read:
477A.013 [MUNICIPAL GOVERNMENT DISTRIBUTIONS.]
Subdivision 1. [TOWNS.] In calendar year 1986 1987, each
town which had levied for taxes payable in the previous year at
least one mill on the dollar of the assessed value of the town
shall receive a distribution equal to 104 percent of the greater
of: (a) 60 percent of the amount received in 1983 pursuant to
Minnesota Statutes 1982, sections 273.138, 273.139, and 477A.011
to 477A.03; or (b) 106 percent of the amount received in 1985
1986 pursuant to Minnesota Statutes 1984, sections 477A.011 to
477A.03.
Subd. 2. [CITIES.] In calendar year 1986 1987, each city
shall receive a local government aid distribution as determined
by the following steps.
(1) A preliminary aid amount shall be computed for each
city equal to the amount obtained by subtracting its local
effort mill rate multiplied by its equalized assessed value from
its fiscal need factor, except that its preliminary aid amount
may not be less than its previous year aid amount.
For any city which received more than $70 per capita in
attached machinery aids in 1983 pursuant to Minnesota Statutes
1982, section 273.138, an amount equal to the amount of attached
machinery aids received in 1983 shall be added to the
preliminary aid amount.
(2) For each city, an aid increase amount equal to the
amount by which its preliminary aid amount exceeds its previous
year aid amount shall be determined. Each city's aid increase
amount shall be reduced by a uniform percentage as determined by
the commissioner of revenue, to make the sum of the final aid
distributions for all cities equal the aid limitation imposed by
subdivision 3.
(3) Each city's final aid amount shall be equal to the sum
of its aid increase amount, as adjusted, and its previous year
aid amount; provided, however, that no city's aid shall exceed
its maximum aid amount, and further provided that no city which
is a city of the first class shall have a final aid amount which
is less than 102 percent of its previous year aid.
Subd. 3. [AID LIMITATION.] The total amount available for
distribution to cities pursuant to subdivision 2 shall be
$286,000,000 $297,440,000 for calendar year 1986 1987.
Sec. 5. Minnesota Statutes 1984, section 477A.015, is
amended to read:
477A.015 [PAYMENT DATES.]
The commissioner of revenue shall make the payments of
local government aid to affected taxing authorities in six two
installments on July 15, August 15, September 15, October 15,
November 15, and December 15 annually.
For calendar year 1981 only, the commissioner shall make
the payments in seven installments computed as follows:
one-fourth of the calendar year 1981 aids shall be paid on March
15; the remaining amounts shall be divided into six equal
payments to be made on July 15, August 15, September 15, October
15, November 15, and December 15. The commissioner may pay all
or part of the payment due on December 15 at any time after
August 15 upon the request of a city that requests such payment
as being necessary for meeting its cash flow needs.
Sec. 6. [EFFECTIVE DATE.]
Section 5 is effective July 1, 1986.
ARTICLE 7
COMPLIANCE
Section 1. Minnesota Statutes 1984, section 60A.15,
subdivision 2, is amended to read:
Subd. 2. [DOMESTIC MUTUAL INSURANCE COMPANIES.] On or
before April 15, June 15, September 15 and December 15 of each
year, every domestic mutual insurance company including township
and farmers' insurance companies shall pay to the commissioner
of revenue quarterly installments equal to one-third of the
insurer's total estimated tax for the current year based on a
sum equal to two percent of the gross direct fire, lightning,
and sprinkler leakage premiums, less return premiums on all
direct business, except auto and ocean marine fire business
received by it, or by its agents for it, in cash or otherwise,
on property located in this state, during such year. If unpaid
by such dates, there shall be added to the tax for the taxable
year an amount determined pursuant to subdivisions 1a to 1c.
Failure of a company to make quarterly payments of at least
one-fourth one-third of either (a) the total tax paid during the
previous calendar year or (b) 80 percent of the actual tax for
the current calendar year shall subject the company to the
penalty and interest provided in this subdivision.
Sec. 2. Minnesota Statutes 1985 Supplement, section
60A.17, subdivision 1a, is amended to read:
Subd. 1a. [LICENSE APPLICATION.] (a) [PROCEDURE.] An
application for a license to act as an insurance agent shall be
made to the commissioner by the person who seeks to be
licensed. The application for license shall be accompanied by a
written appointment from an admitted insurer authorizing the
applicant to act as its agent under one or both classes of
license. The insurer must also submit its check payable to the
state treasurer for the amount of the appointment fee prescribed
by section 60A.14, subdivision 1, paragraph (c), clause (9) at
the time the agent becomes licensed. The application and
appointment shall be on forms prescribed by the commissioner.
If the applicant is a natural person, no license shall be
issued until that natural person has become qualified.
If the applicant is a partnership or corporation, no
license shall be issued until at least one natural person who is
a partner, director, officer, stockholder, or employee shall be
licensed as an insurance agent.
(b) [RESIDENT AGENT.] The commissioner shall issue a
resident insurance agent's license to a qualified resident of
this state as follows:
(1) a person may qualify as a resident of this state if
that person resides in this state or the principal place of
business of that person is maintained in this state.
Application for a license claiming residency in this state for
licensing purposes, shall constitute an election of residency in
this state. Any license issued upon an application claiming
residency in this state shall be void if the licensee, while
holding a resident license in this state, also holds, or makes
application for, a resident license in, or thereafter claims to
be a resident of, any other state or jurisdiction or if the
licensee ceases to be a resident of this state; provided,
however, if the applicant is a resident of a community or trade
area, the border of which is contiguous with the state line of
this state, the applicant may qualify for a resident license in
this state and at the same time hold a resident license from the
contiguous state;
(2) the commissioner shall subject each applicant who is a
natural person to a written examination as to the applicant's
competence to act as an insurance agent. The examination shall
be held at a reasonable time and place designated by the
commissioner;
(3) the examination shall be approved for use by the
commissioner and shall test the applicant's knowledge of the
lines of insurance, policies, and transactions to be handled
under the class of license applied for, of the duties and
responsibilities of the licensee, and pertinent insurance laws
of this state;
(4) the examination shall be given only after the applicant
has completed a program of classroom studies in a school, which
shall include a school conducted by an admitted insurer. The
course of study shall consist of 30 hours of classroom study
devoted to the basic fundamentals of insurance for those seeking
a Minnesota license for the first time, 15 hours devoted to
specific life and health topics for those seeking a life and
health license, and 15 hours devoted to specific property and
casualty topics for those seeking a property and casualty
license. The program of studies or study course shall have been
approved by the commissioner in order to qualify under this
clause. If the applicant has been previously licensed for the
particular line of insurance in the state of Minnesota, the
requirement of a program of studies or a study course shall be
waived. A certification of compliance by the organization
offering the course shall accompany the applicant's license
application. This program of studies in a school or a study
course shall not apply to farm property perils and farm
liability applicants, or to agents writing such other lines of
insurance as the commissioner may exempt from examination by
order;
(5) the applicant must pass the examination with a grade
determined by the commissioner to indicate satisfactory
knowledge and understanding of the class or classes of insurance
for which the applicant seeks qualification. The commissioner
shall inform the applicant as to whether or not the applicant
has passed;
(6) an applicant who has failed to pass an examination may
take subsequent examinations. Examination fees for subsequent
examinations shall not be waived; and
(7) any applicant for a license covering the same class or
classes of insurance for which the applicant was licensed under
a similar license in this state, other than a temporary license,
within the three years preceding the date of the application
shall be exempt from the requirement of a written examination,
unless the previous license was revoked or suspended by the
commissioner. An applicant whose license is not renewed under
subdivision 20 is exempt from the requirement of a written
examination.
(c) [NONRESIDENT AGENT.] The commissioner shall issue a
nonresident insurance agent's license to a qualified person who
is a resident of another state or country as follows:
(1) A person may qualify for a license under this section
as a nonresident only if that person holds a license in another
state, province of Canada, or other foreign country which, in
the opinion of the commissioner, qualifies that person for the
same activity as that for which a license is sought;
(2) The commissioner shall not issue a license to any
nonresident applicant until that person files with the
commissioner a designation of the commissioner and the
commissioner's successors in office as the applicant's true and
lawful attorney upon whom may be served all lawful process in
any action, suit, or proceeding instituted by or on behalf of
any interested person arising out of the applicant's insurance
business in this state. This designation shall constitute an
agreement that this service of process is of the same legal
force and validity as personal service of process in this state
upon that applicant.
Service of process upon any licensee in any action or
proceeding commenced in any court of competent jurisdiction of
this state may be made by serving the commissioner with
appropriate copies of the process along with payment of the fee
pursuant to section 60A.14, subdivision 1, paragraph (c), clause
(4). The commissioner shall forward a copy of the process by
registered or certified mail to the licensee at the last known
address of record or principal place of business of the
licensee; and
(3) A nonresident license shall terminate automatically
when the resident license for that class of license in the
state, province, or foreign country in which the licensee is a
resident is terminated for any reason.
(d) [DENIAL.] (1) If the commissioner finds that an
applicant for a resident or nonresident license has not fully
met the requirements for licensing, the commissioner shall
refuse to issue the license and shall promptly give written
notice to both the applicant and the appointing insurer of the
denial, stating the grounds for the denial. All fees which
accompanied the application and appointment shall be deemed
earned and shall not be refundable.
(2) The commissioner may also deny issuance of a license
for any cause that would subject the license of a licensee to
suspension or revocation. If a license is denied pursuant to
this clause, the provisions of subdivision 6c, paragraph (c)
apply.
(3) The applicant may make a written demand upon the
commissioner for a hearing within 30 days of the denial of a
license to determine whether the reasons stated for the denial
were lawful. The hearing shall be held pursuant to chapter 14.
(e) [TERM.] All licenses issued pursuant to this section
shall remain in force until voluntarily terminated by the
licensee, not renewed as prescribed in subdivision 1d, or until
suspended or revoked by the commissioner. A voluntary
termination shall occur when the license is surrendered to the
commissioner with the request that it be terminated or when the
licensee dies, or when the licensee is dissolved or its
existence is terminated. In the case of a nonresident license,
a voluntary termination shall also occur upon the happening of
the event described in paragraph (c), clause (3).
Every licensed agent shall notify the commissioner within
30 days of any change of name, address, or information contained
in the application.
(f) [SUBSEQUENT APPOINTMENTS.] A person who holds a valid
agent's license from this state may solicit applications for
insurance on behalf of an admitted insurer with which the
licensee does not have a valid appointment on file with the
commissioner; provided, that the licensee has permission from
the insurer to solicit insurance on its behalf and, provided
further, that the insurer upon receipt of the application for
insurance submits a written notice of appointment to the
commissioner accompanied by its check payable to the state
treasurer in the amount of the appointment fee prescribed by
section 60A.14, subdivision 1, paragraph (c), clause (9). The
notice of appointment shall be on a form prescribed by the
commissioner.
(g) [AMENDMENT OF LICENSE.] An application to the
commissioner to amend a license to reflect a change of name, or
to include an additional class of license, or for any other
reason, shall be on forms provided by the commissioner and shall
be accompanied by the applicant's surrendered license and a
check payable to the state treasurer for the amount of fee
specified in section 60A.14, subdivision 1, paragraph (c).
An applicant who surrenders an insurance license pursuant
to this clause retains licensed status until an amended license
is received.
(h) [EXCEPTIONS.] The following are exempt from the general
licensing requirements prescribed by this section:
(1) agents of township mutuals who are exempted pursuant to
subdivision 1b;
(2) fraternal beneficiary association representatives
exempted pursuant to subdivision 1c;
(3) any regular salaried officer or employee of a licensed
insurer, without license or other qualification, may act on
behalf of that licensed insurer in the negotiation of insurance
for that insurer; provided that a licensed agent must
participate in the sale of any such insurance;
(4) employers and their officers or employees, and the
trustees or employees of any trust plan, to the extent that the
employers, officers, employees, or trustees are engaged in the
administration or operation of any program of employee benefits
for the employees of the employers or employees of their
subsidiaries or affiliates involving the use of insurance issued
by a licensed insurance company; provided, that the activities
of the officers, employees and trustees are incidental to
clerical or administrative duties and their compensation does
not vary with the volume of insurance or applications therefor;
(5) employees of a creditor who enroll debtors for life or
accident and health insurance; provided the employees receive no
commission or fee therefor; and
(6) clerical or administrative employees of an insurance
agent who take insurance applications or receive premiums in the
office of their employer, if the activities are incidental to
clerical or administrative duties and the employee's
compensation does not vary with the volume of the applications
or premiums.
Sec. 3. Minnesota Statutes 1984, section 60A.17, is
amended by adding a subdivision to read:
Subd. 20. [TAX CLEARANCE CERTIFICATE.] (a) The
commissioner may not issue or renew a license under this section
if the commissioner of revenue notifies the commissioner and the
licensee or applicant for a license that the licensee or
applicant owes the state delinquent taxes in the amount of $500
or more. The commissioner may issue or renew the license only
if (1) the commissioner of revenue issues a tax clearance
certificate and (2) the commissioner of revenue or the licensee
or applicant forwards a copy of the clearance to the
commissioner. The commissioner of revenue may issue a clearance
certificate only if the licensee or applicant does not owe the
state any uncontested delinquent taxes.
(b) For purposes of this subdivision, the following terms
have the meanings given.
(1) "Taxes" are all taxes payable to the commissioner of
revenue, including penalties and interest due on those taxes.
(2) "Delinquent taxes" do not include a tax liability if
(i) an administrative or court action that contests the amount
or validity of the liability has been filed or served, (ii) the
appeal period to contest the tax liability has not expired, or
(iii) the licensee or applicant has entered into a payment
agreement to pay the liability and is current with the payments.
(c) In lieu of the notice and hearing requirements of
subdivisions 6c and 6d, when a licensee or applicant is required
to obtain a clearance certificate under this subdivision, a
contested case hearing must be held if the licensee or applicant
requests a hearing in writing to the commissioner of revenue
within 30 days of the date of the notice provided in paragraph
(a). The hearing must be held within 45 days of the date the
commissioner of revenue refers the case to the office of
administrative hearings. Notwithstanding any law to the
contrary, the licensee or applicant must be served with 20 days'
notice in writing specifying the time and place of the hearing
and the allegations against the licensee or applicant. The
notice may be served personally or by mail.
(d) The commissioner shall require all licensees or
applicants to provide their social security number and Minnesota
business identification number on all license applications.
Upon request of the commissioner of revenue, the commissioner
must provide to the commissioner of revenue a list of all
licensees and applicants, including the name and address, social
security number, and business identification number. The
commissioner of revenue may request a list of the licensees and
applicants no more than once each calendar year.
Notwithstanding sections 290.61 and 297A.43, the commissioner of
revenue may release information necessary to accomplish the
purpose of this subdivision.
Sec. 4. Minnesota Statutes 1984, section 69.54, is amended
to read:
69.54 [SURCHARGE ON PREMIUMS TO RESTORE DEFICIENCY IN
SPECIAL FUND.]
The commissioner shall order and direct a surcharge to be
collected of two percent of the fire, lightning, and sprinkler
leakage gross premiums, less return premiums, on all direct
business received by any foreign or domestic fire insurance
company on property in this city of the first class, or by its
agents for it, in cash or otherwise. This surcharge shall be
due and payable from these companies to the state treasurer, in
semiannual equal installments, on June 30th and December 31st
March 15, May 15, and November 15 of each calendar year, and if
not paid within 30 days after these dates, a penalty of ten
percent shall accrue thereon and thereafter this sum and penalty
shall draw interest at the rate of one percent per month until
paid.
Sec. 5. Minnesota Statutes 1984, section 82.22,
subdivision 3, is amended to read:
Subd. 3. [RE-EXAMINATIONS.] An examination may be required
before the renewal of any license which has been suspended, or
before the issuance of a license to any person whose license has
been ineffective for a period of one year, except no
re-examination shall be required of any individual who has
failed to cause renewal of an existing license because of
absence from the state while on active duty with the armed
services of the United States of America, and no reexamination
shall be required of an individual whose license has not been
renewed under section 82.27, subdivision 7.
Sec. 6. Minnesota Statutes 1984, section 82.27, is amended
by adding a subdivision to read:
Subd. 7. [TAX CLEARANCE CERTIFICATE.] (a) In addition to
the provisions of subdivision 1, the commissioner may not issue
or renew a license if the commissioner of revenue notifies the
commissioner and the licensee or applicant for a license that
the licensee or applicant owes the state delinquent taxes in the
amount of $500 or more. The commissioner may issue or renew the
license only if (1) the commissioner of revenue issues a tax
clearance certificate and (2) the commissioner of revenue or the
licensee or applicant forwards a copy of the clearance to the
commissioner. The commissioner of revenue may issue a clearance
certificate only if the licensee or applicant does not owe the
state any uncontested delinquent taxes.
(b) For purposes of this subdivision, the following terms
have the meanings given.
(1) "Taxes" are all taxes payable to the commissioner of
revenue, including penalties and interest due on those taxes.
(2) "Delinquent taxes" do not include a tax liability if
(i) an administrative or court action that contests the amount
or validity of the liability has been filed or served, (ii) the
appeal period to contest the tax liability has not expired, or
(iii) the licensee or applicant has entered into a payment
agreement to pay the liability and is current with the payments.
(c) In lieu of the notice and hearing requirements of
subdivisions 3, 4, 5, and 6, when a licensee or applicant is
required to obtain a clearance certificate under this
subdivision, a contested case hearing must be held if the
licensee or applicant requests a hearing in writing to the
commissioner of revenue within 30 days of the date of the notice
provided in paragraph (a). The hearing must be held within 45
days of the date the commissioner of revenue refers the case to
the office of administrative hearings. Notwithstanding any law
to the contrary, the licensee or applicant must be served with
20 days' notice in writing specifying the time and place of the
hearing and the allegations against the licensee or applicant.
The notice may be served personally or by mail.
(d) The commissioner shall require all licensees or
applicants to provide their social security number and Minnesota
business identification number on all license applications.
Upon request of the commissioner of revenue, the commissioner
must provide to the commissioner of revenue a list of all
licensees and applicants, including the name and address, social
security number and business identification number. The
commissioner of revenue may request a list of the licensees and
applicants no more than once each calendar year.
Notwithstanding sections 290.61 and 297A.43, the commissioner of
revenue may release information necessary to accomplish the
purpose of this subdivision.
Sec. 7. Minnesota Statutes 1985 Supplement, section
147.021, is amended by adding a subdivision to read:
Subd. 7. [TAX CLEARANCE CERTIFICATE.] (a) In addition to
the provisions of subdivision 1, the board may not issue or
renew a license if the commissioner of revenue notifies the
board and the licensee or applicant for a license that the
licensee or applicant owes the state delinquent taxes in the
amount of $500 or more. The board may issue or renew the
license only if (1) the commissioner of revenue issues a tax
clearance certificate and (2) the commissioner of revenue or the
licensee or applicant forwards a copy of the clearance to the
board. The commissioner of revenue may issue a clearance
certificate only if the licensee or applicant does not owe the
state any uncontested delinquent taxes.
(b) For purposes of this subdivision, the following terms
have the meanings given.
(1) "Taxes" are all taxes payable to the commissioner of
revenue, including penalties and interest due on those taxes.
(2) "Delinquent taxes" do not include a tax liability if
(i) an administrative or court action that contests the amount
or validity of the liability has been filed or served, (ii) the
appeal period to contest the tax liability has not expired, or
(iii) the licensee or applicant has entered into a payment
agreement to pay the liability and is current with the payments.
(c) In lieu of the notice and hearing requirements of
subdivision 1, when a licensee or applicant is required to
obtain a clearance certificate under this subdivision, a
contested case hearing must be held if the licensee or applicant
requests a hearing in writing to the commissioner of revenue
within 30 days of the date of the notice provided in paragraph
(a). The hearing must be held within 45 days of the date the
commissioner of revenue refers the case to the office of
administrative hearings. Notwithstanding any law to the
contrary, the licensee or applicant must be served with 20 days'
notice in writing specifying the time and place of the hearing
and the allegations against the licensee or applicant. The
notice may be served personally or by mail.
(d) The board shall require all licensees or applicants to
provide their social security number and Minnesota business
identification number on all license applications. Upon request
of the commissioner of revenue, the board must provide to the
commissioner of revenue a list of all licensees and applicants,
including the name and address, social security number, and
business identification number. The commissioner of revenue may
request a list of the licensees and applicants no more than once
each calendar year. Notwithstanding sections 290.61 and
297A.43, the commissioner of revenue may release information
necessary to accomplish the purpose of this subdivision.
Sec. 8. Minnesota Statutes 1984, section 148.10, is
amended by adding a subdivision to read:
Subd. 5. [TAX CLEARANCE CERTIFICATE.] (a) In addition to
the grounds provided in subdivision 1, the board may not issue
or renew a license to practice chiropractic if the commissioner
of revenue notifies the board and the licensee or applicant for
a license that the licensee or applicant owes the state
delinquent taxes in the amount of $500 or more. The board may
issue or renew the license only if (1) the commissioner of
revenue issues a tax clearance certificate and (2) the
commissioner of revenue or the licensee or applicant forwards a
copy of the clearance to the board. The commissioner of revenue
may issue a clearance certificate only if the licensee or
applicant does not owe the state any uncontested delinquent
taxes.
(b) For purposes of this subdivision, the following terms
have the meanings given.
(1) "Taxes" are all taxes payable to the commissioner of
revenue, including penalties and interest due on those taxes.
(2) "Delinquent taxes" do not include a tax liability if
(i) an administrative or court action that contests the amount
or validity of the liability has been filed or served, (ii) the
appeal period to contest the tax liability has not expired, or
(iii) the licensee or applicant has entered into a payment
agreement to pay the liability and is current with the payments.
(c) In lieu of the notice and hearing requirements of
subdivisions 3 and 4, when a licensee or applicant is required
to obtain a clearance certificate under this subdivision, a
contested case hearing must be held if the licensee or applicant
requests a hearing in writing to the commissioner of revenue
within 30 days of the date of the notice provided in paragraph
(a). The hearing must be held within 45 days of the date the
commissioner of revenue refers the case to the office of
administrative hearings. Notwithstanding any law to the
contrary, the licensee or applicant must be served with 20 days'
notice in writing specifying the time and place of the hearing
and the allegations against the licensee or applicant. The
notice may be served personally or by mail.
(d) The board shall require all licensees or applicants of
a license to practice chiropractic to provide their social
security number and Minnesota business identification number on
all license applications. Upon request of the commissioner of
revenue, the board must provide to the commissioner of revenue a
list of all licensees and applicants for a license to practice
chiropractic, including the name and address, social security
number, and business identification number. The commissioner of
revenue may request a list of the licensees and applicants no
more than once each calendar year. Notwithstanding sections
290.61 and 297A.43, the commissioner of revenue may release
information necessary to accomplish the purpose of this
subdivision.
Sec. 9. Minnesota Statutes 1984, section 150A.08, is
amended by adding a subdivision to read:
Subd. 9. [TAX CLEARANCE CERTIFICATE.] (a) In addition to
the grounds provided in subdivision 1 and notwithstanding
subdivision 3, the board may not issue or renew a license to
practice dentistry if the commissioner of revenue notifies the
board and the licensee or applicant for a license that the
licensee or applicant owes the state delinquent taxes in the
amount of $500 or more. The board may issue or renew the
license only if (1) the commissioner of revenue issues a tax
clearance certificate and (2) the commissioner of revenue or the
licensee or applicant forwards a copy of the clearance to the
board. The commissioner of revenue may issue a clearance
certificate only if the licensee or applicant does not owe the
state any uncontested delinquent taxes.
(b) For purposes of this subdivision, the following terms
have the meanings given.
(1) "Taxes" are all taxes payable to the commissioner of
revenue, including penalties and interest due on those taxes.
(2) "Delinquent taxes" do not include a tax liability if
(i) an administrative or court action that contests the amount
or validity of the liability has been filed or served, (ii) the
appeal period to contest the tax liability has not expired, or
(iii) the licensee or applicant has entered into a payment
agreement to pay the liability and is current with the payments.
(c) In lieu of the notice and hearing requirements of
subdivision 8, when a licensee or applicant is required to
obtain a clearance certificate under this subdivision, a
contested case hearing must be held if the licensee or applicant
requests a hearing in writing to the commissioner of revenue
within 30 days of the date of the notice provided in paragraph
(a). The hearing must be held within 45 days of the date the
commissioner of revenue refers the case to the office of
administrative hearings. Notwithstanding any law to the
contrary, the licensee or applicant must be served with 20 days'
notice in writing specifying the time and place of the hearing
and the allegations against the licensee or applicant. The
notice may be served personally or by mail.
(d) The board shall require all licensees or applicants for
a license to practice dentistry to provide their social security
number and Minnesota business identification number on all
license applications. Upon request of the commissioner of
revenue, the board must provide to the commissioner of revenue a
list of all licensees and applicants for a license to practice
dentistry including the name and address, social security
number, and business identification number. The commissioner of
revenue may request a list of the licensees and applicants no
more than once each calendar year. Notwithstanding sections
290.61 and 297A.43, the commissioner of revenue may release
information necessary to accomplish the purpose of this
subdivision.
Sec. 10. Minnesota Statutes 1985 Supplement, section
270.063, is amended to read:
270.063 [COLLECTION OF DELINQUENT TAXES.]
For the purpose of collecting delinquent state tax
liabilities from taxpayers who do not reside or are not located
in Minnesota, there is appropriated to the commissioner of
revenue an amount representing the cost of collection, not to
exceed one-third of the amount collected by contract with
collection agencies, revenue departments of other states, or
attorneys to enable the commissioner to reimburse these
agencies, departments, or attorneys for this service. The
commissioner shall report quarterly on the status of this
program to the chairmen of the house tax and appropriation
committees and senate tax and finance committees.
Notwithstanding section 16A.15, subdivision 3, the
commissioner of revenue may authorize the prepayment of
sheriff's fees, attorney fees, fees charged by revenue
departments of other states, or court costs to be incurred in
connection with the collection out of state of delinquent tax
liabilities owed to the commissioner of revenue.
Sec. 11. Minnesota Statutes 1985 Supplement, section
270.69, subdivision 2, is amended to read:
Subd. 2. [FILING OF LIENS NECESSARY FOR ENFORCEABILITY
AGAINST CERTAIN PERSONS.] The lien imposed by subdivision 1 is
not enforceable against any purchaser, mortgagee, pledgee,
holder of a uniform commercial code security interest,
mechanic's lienor, or judgment lien creditor, until a notice of
lien has been filed by the commissioner of revenue in the office
of the county recorder of the county in which the property is
situated, or in the case of personal property belonging to an
individual who is not a resident of this state, or which is a
corporation, partnership, or other organization, in the office
of the secretary of state. The indexing of liens filed pursuant
to this subdivision and, notwithstanding section 386.77, the
fees charged for such filing and indexing, shall be as
prescribed in sections 272.483 and 272.484. Notwithstanding any
other law to the contrary, the department of revenue is exempt
from the payment of fees at the time the lien is offered for
filing or recording. The fee for filing or recording the lien
must be paid at the time the release of lien is offered for
filing or recording. Notwithstanding any law to the contrary,
the fee for filing or recording the lien or the release of lien
is $15.
Sec. 12. Minnesota Statutes 1985 Supplement, section
270.69, subdivision 3, is amended to read:
Subd. 3. [EXEMPT PROPERTY.] The lien imposed on personal
property by this section, even though properly filed, is not
enforceable against a purchaser with respect to tangible
personal property purchased at retail, or against the personal
property listed as exempt in sections 550.37, 550.38, and
550.39, or against the homestead of the taxpayer as defined in
chapter 510.
Sec. 13. Minnesota Statutes 1985 Supplement, section
270.69, subdivision 4, is amended to read:
Subd. 4. [PERIOD OF LIMITATIONS.] The lien imposed by this
section shall, notwithstanding any other provision of law to the
contrary, be enforceable from the time the lien arises and for
ten years from the date of filing the notice of lien, which must
be filed by the commissioner within five years after the date of
assessment of the tax. A notice of lien filed in one county may
be transcribed to any other county within ten years after the
date of its filing, but the transcription shall not extend the
period during which the lien is enforceable. A notice of lien
may be renewed by the commissioner before the expiration of the
ten-year period for an additional ten years. The taxpayer must
receive written notice of the renewal.
Sec. 14. Minnesota Statutes 1984, section 270.69, is
amended by adding a subdivision to read:
Subd. 10. [LIMITATION FOR HOMESTEAD PROPERTY.] A lien
imposed under this section upon property defined as homestead
property in chapter 510 may not be enforced against homestead
property by levy under section 270.70, or by judgment lien under
chapter 550.
Sec. 15. Minnesota Statutes 1984, section 270.72,
subdivision 1, is amended to read:
Subdivision 1. [TAX CLEARANCE REQUIRED.] The state or a
political subdivision of the state may not issue, transfer, or
renew a license for the conduct of a profession, trade, or
business, if the commissioner notifies the licensing authority
that the applicant owes the state delinquent taxes, penalties,
or interest. The commissioner may not notify the licensing
authority unless the applicant taxpayer owes $1,000 $500 or more
in delinquent taxes. A licensing authority that has received a
notice from the commissioner may issue, transfer, or renew the
applicant's license only if (a) the commissioner issues a tax
clearance certificate and (b) the commissioner or the applicant
forwards a copy of the clearance to the authority. The
commissioner may issue a clearance certificate only if the
applicant does not owe the state any uncontested delinquent
taxes, penalties, or interest.
Sec. 16. Minnesota Statutes 1984, section 270.72,
subdivision 2, is amended to read:
Subd. 2. [DEFINITIONS.] For purposes of this section, the
following terms have the meanings given.
(a) "Taxes" are limited to withholding tax as provided in
section 290.92, sales and use tax as provided in chapter 297A,
and motor vehicle excise tax as provided in chapter 297B.
Penalties and interest are limited to penalties and interest due
on taxes included in this definition.
(b) "Delinquent taxes" do not include a tax liability if
(i) an administrative or court action which contests the amount
or validity of the liability has been filed or served, (ii) the
appeal period to contest the tax liability has not expired, or
(iii) the applicant has entered into a payment agreement and is
current with the payments.
(c) "Applicant" means an individual if the license is
issued to or in the name of an individual or the corporation or
partnership if the license is issued to or in the name of a
corporation or partnership. "Applicant" also means an officer
of a corporation or a member of a partnership who is liable for
the delinquent taxes pursuant to section 270.10, subdivision 4,
either for the entity for which the license is at issue or for
another entity for which the liability was incurred, or
personally as a licensee.
Sec. 17. Minnesota Statutes 1984, section 270.72,
subdivision 3, is amended to read:
Subd. 3. [NOTICE AND HEARING.] If the commissioner
notifies a licensing authority pursuant to subdivision 1, he
must send a copy of the notice to the applicant. In the case of
the renewal of a license If the applicant requests, in writing,
within 30 days of the receipt date of the notice a hearing, a
contested case hearing must be held. The hearing must be held
within 45 days of the date the commissioner refers the case to
the office of administrative hearings. The hearing must be held
under the procedures provided by section 270A.09 and the
administrative rules promulgated under chapter
270A. Notwithstanding any law to the contrary, the applicant
must be served with 20 days' notice in writing specifying the
time and place of the hearing and the allegations against the
applicant. The notice may be served personally or by mail.
Sec. 18. Minnesota Statutes 1985 Supplement, section
270.76, is amended to read:
270.76 [INTEREST ON REFUNDS.]
When any tax payable to the commissioner of revenue or to
the department of revenue is overpaid and an amount is due the
taxpayer as a refund of the overpayment, the overpayment shall
bear interest from the date of payment of the tax until the date
the refund is paid or credit is made, unless another period for
computing interest is provided by law. The interest rate per
annum on overpayments shall be 80 percent of the interest rate
contained in section 270.75, subdivision 5; the rate shall be
adjusted annually and become effective as provided in section
270.75, subdivision 5; and the result of the adjustment in the
rate shall be rounded to the nearest full percent. The
determination of the commissioner pursuant to this subdivision
is not a "rule" and is not subject to the administrative
procedure act contained in chapter 14.
Sec. 19. Minnesota Statutes 1985 Supplement, section
273.124, is amended by adding a subdivision to read:
Subd. 13. [SOCIAL SECURITY NUMBER REQUIRED FOR HOMESTEAD
APPLICATION.] Beginning with the January 2, 1987, assessment,
every property owner applying for homestead classification must
furnish to the county assessor that owner's social security or
taxpayer identification number. If the social security or
taxpayer identification number is not provided, the county
assessor shall classify the property as nonhomestead. The
social security numbers of the property owners are private data
on individuals as defined by section 13.02, subdivision 12, but,
notwithstanding that section, the private data may be disclosed
to the commissioner of revenue.
At the request of the commissioner, each county must give
the commissioner a listing that includes the name and social
security or taxpayer identification number of each property
owner applying for homestead classification.
If, in comparing the lists supplied by the counties, the
commissioner finds that a property owner is claiming more than
one homestead, the commissioner shall notify the appropriate
counties. Within 90 days of the notification, the county
assessor shall investigate to determine if the homestead
classification was properly claimed. If the property owner does
not qualify, the county assessor shall notify the county auditor
who will determine the amount of homestead benefits that had
been improperly allowed. For the purpose of this section,
"homestead benefits" means homestead credit, taconite homestead
credit, supplemental homestead credit, and the agricultural
school credit which is in excess of the credit which would be
allowed if the property had been classified as nonhomestead
property. The county auditor shall send a notice to the owners
of the affected property, demanding reimbursement of the
homestead benefits plus a penalty equal to 25 percent of the
homestead benefits. The property owners may appeal the county's
determination by filing a notice of appeal with the Minnesota
tax court within 60 days of the date of the notice from the
county.
If the amount of homestead benefits and penalty is not paid
within 60 days, and if no appeal has been filed, the county
auditor shall certify the amount to the succeeding year's tax
list to be collected as part of the property taxes.
Any amount of homestead benefits recovered from the
property owner must be transmitted to the commissioner by the
end of each calendar quarter. Any amount recovered attributable
to taconite homestead credit shall be transmitted to the St.
Louis county auditor to be deposited in the taconite property
tax relief account. The amount of penalty collected must be
deposited in the county general fund.
The commissioner will provide suggested homestead
applications to each county. If a property owner has applied
for more than one homestead and the county assessors cannot
determine which property should be classified as homestead, the
county assessors will refer the information to the commissioner.
The commissioner shall make the determination and notify the
counties within 60 days.
In addition to lists of homestead properties, the
commissioner may ask the counties to furnish lists of all
properties and the record owners.
Sec. 20. Minnesota Statutes 1984, section 290.53,
subdivision 2, is amended to read:
Subd. 2. [FAILURE TO MAKE AND FILE RETURN.] In case of any
failure to make and file a return as required by this chapter
within the time prescribed by law or prescribed by the
commissioner in pursuance of law, there shall be added to the
tax or subtracted from the refund in lieu of the penalty
provided in subdivision 1: ten percent of the amount of tax
unpaid if the failure is for not more than 30 days with an
additional five percent for each additional 30 days or fraction
thereof during which such failure continues, not exceeding 25
percent in the aggregate; or ten percent of the amount of the
refund claimed if the failure is for more than 60 but less than
90 days (determined with regard to any extensions of time for
filing), with an additional five percent for each additional 30
days or fraction thereof during which such failure continues,
not exceeding 25 percent in the aggregate.
In addition to the penalty imposed above, in the case of a
failure to file a return of tax imposed by this chapter within
60 days of the date prescribed for filing of the return
(determined with regard to any extensions of time for filing),
where the return has been demanded by the commissioner under the
provisions of section 290.47, the amount there shall be added to
the tax under this subdivision shall not be less than or
subtracted from the refund the lesser of $50 (i) $100 or (ii)
100 percent of either the amount required to be shown as the
amount of tax which is due with the return or the amount of the
refund.
The amount so added to any tax shall be collected at the
same time and in the same manner and as a part of the tax, and
the amount of said tax together with the amount so added shall
bear interest at the rate specified in section 270.75 from the
time such tax should have been paid until paid unless the tax
has been paid before the discovery of the neglect, in which case
the amount so added shall be collected in the same manner as the
tax.
For the purposes of this subdivision the amount of any
taxes required to be shown on the return shall be reduced by the
amount of any part of the tax which is paid on or before the
date prescribed for payment of the tax and by the amount of any
credit against the tax which may be claimed upon the return.
Sec. 21. Minnesota Statutes 1984, section 290.61, is
amended to read:
290.61 [PUBLICITY OF RETURNS, INFORMATION.]
It shall be unlawful for the commissioner or any other
public official or employee to divulge or otherwise make known
in any manner any particulars set forth or disclosed in any
report or return required by this chapter, or any information
concerning, the taxpayer's affairs acquired from his or its
records, officers, or employees while examining or auditing any
taxpayer's liability for taxes imposed hereunder, except in
connection with a proceeding involving taxes due under this
chapter from the taxpayer making such return or to comply with
the provisions of sections 256.978, 268.12, subdivision 12,
270A.11, 273.1314, subdivision 16, 290.612 and 302A.821. The
commissioner may furnish a copy of any taxpayer's return,
including audit documents and information, to any official of
the United States or of any state having duties to perform in
respect to the assessment or collection of any tax imposed upon
or measured by income, if such taxpayer is required by the laws
of the United States or of such state to make a return therein.
Prior to the release of any information to any official of the
United States or any other state under the provisions of this
section, the person to whom the information is to be released
shall sign an agreement which provides that he will protect the
confidentiality of the returns and information revealed thereby
to the extent that it is protected under the laws of the state
of Minnesota. The commissioner and all other public officials
and employees shall keep and maintain the same secrecy in
respect to any information furnished by any department,
commission, or official of the United States or of any other
state in respect to the income of any person as is required by
this section in respect to information concerning the affairs of
taxpayers under this chapter. Nothing herein contained shall be
construed to prohibit the commissioner from publishing
statistics so classified as not to disclose the identity of
particular returns or reports and the items thereof. Upon
request of a majority of the members of the senate tax committee
or of the house tax committee or the tax study commission, the
commissioner shall furnish abstracted financial information to
those committees for research purposes from returns or reports
filed pursuant to this chapter, provided that he shall not
disclose the name, address, social security number, business
identification number or any other item of information
associated with any return or report which the commissioner
believes is likely to identify the taxpayer. The commissioner
shall not furnish the actual return, or a portion thereof, or a
reproduction or copy of any return or portion thereof.
"Abstracted financial information" means only the dollar amounts
set forth on each line on the form including the filing status.
Any person violating the provisions of this section shall
be guilty of a gross misdemeanor.
In order to locate the named payee on state warrants issued
pursuant to this chapter or chapter 290A and undeliverable by
the United States postal service, the commissioner may publish
in any newspaper of general circulation in this state or make
available to radio or television stations a list of the name and
last known address of the payee as shown on the reports or
returns filed with the commissioner. The commissioner may
exclude the names of payees whose refunds are in an amount which
is less than a minimal amount to be determined by the
commissioner. The list shall not contain any particulars set
forth on any report or return. The publication or announcement
shall include instructions on claiming the warrants.
An employee of the department of revenue may, in connection
with his official duties relating to any audit, collection
activity, or civil or criminal tax investigation or any other
offense under this chapter, disclose return information to the
extent that such disclosure is necessary in obtaining
information, which is not not otherwise reasonably available,
with respect to the correct determination of tax, liability for
tax, or the amount to be collected or with respect to the
enforcement of any other provision of this chapter.
In order to facilitate processing of returns and payments
of taxes required by this chapter, or to facilitate the
development, implementation, and use of computer programs and
automated procedures for purposes of administering this chapter
or chapter 290A, the commissioner may contract with outside
vendors and may disclose private and nonpublic data to the
vendor. The data disclosed will be administered by the vendor
consistent with this section, and the vendor must agree to
subject himself and his employees to the civil and criminal
penalties provided by law for unlawful disclosure.
Information from a tax return required under this chapter
on a holder of a license issued by the Minnesota racing
commission or an owner of a horse may be provided by the
commissioner to the Minnesota racing commission.
The commissioner may provide to the Minnesota supreme court
and the board of professional responsibility information
regarding the amount of any uncontested delinquent taxes due
under this chapter or a failure to file a return due under this
chapter by an attorney admitted to practice law in this state
under chapter 481.
Sec. 22. Minnesota Statutes 1984, section 297.07,
subdivision 1, is amended to read:
Subdivision 1. [MONTHLY RETURN FILED WITH COMMISSIONER.]
On or before the eighteenth twenty-fifth day of each calendar
month every distributor with a place of business in this state
shall file a return with the commissioner showing the quantity
of cigarettes manufactured or brought in from without the state
or purchased during the preceding calendar month and the
quantity of cigarettes sold or otherwise disposed of in this
state and outside this state during that month. Every licensed
distributor outside this state shall in like manner file a
return showing the quantity of cigarettes shipped or transported
into this state during the preceding calendar month. Returns
shall be made upon forms furnished and prescribed by the
commissioner and shall contain such other information as the
commissioner may require. The return shall be accompanied by a
remittance for the full unpaid tax liability shown by it.
Sec. 23. Minnesota Statutes 1984, section 297.07,
subdivision 4, is amended to read:
Subd. 4. [MONTHLY TAX PAYMENTS; PENALTY FOR NONPAYMENT.]
(a) Except as provided in paragraph (b), all taxes shall be due
and payable not later than the eighteenth twenty-fifth day of
the month following the calendar month in which they were
incurred, and thereafter shall bear interest at the rate
specified in section 270.75. The commissioner in issuing his
final assessment pursuant to subdivision 3 shall add to the
amount of tax found due and unpaid a penalty of ten percent
thereof, except that, if he finds that the distributor has made
a false and fraudulent return with intent to evade the tax
imposed by sections 297.01 to 297.13, the penalty shall be 25
percent of the entire tax as shown by the corrected return. If
any such tax is not paid within the time herein specified for
the payment thereof or within 30 days after final determination
of an appeal to the Minnesota tax court relating thereto, there
shall be added thereto a specific penalty equal to ten percent
of the amount so remaining unpaid, but in no event shall the
penalty for failure to pay such tax within the time provided for
such payment be less than $10. The commissioner is authorized
to extend the time for paying such tax without penalty for good
cause shown.
(b) Every distributor having a liability of $1,500 or more
in May 1987 or in May of each subsequent year, shall remit the
June liability in the manner required by this section.
On or before June 25, 1987, or June 25 of each subsequent
year, the distributor shall remit the actual May liability and
one-half of the estimated June liability to the commissioner and
file the return on a form prescribed by the commissioner.
On or before August 25, 1987, or August 25 of each
subsequent year, the distributor shall submit a return showing
the actual June liability and paying any additional amount of
tax not remitted in June. A penalty is imposed equal to ten
percent of the amount of June liability required to be paid in
June less the amount remitted in June. However, the penalty
shall not be imposed if the amount remitted in June equals the
lesser of (a) 45 percent of the actual June liability, or (b) 50
percent of the preceding May's liability.
Sec. 24. Minnesota Statutes 1984, section 297.23,
subdivision 1, is amended to read:
Subdivision 1. On or before the eighteenth twenty-fifth
day of each calendar month, every consumer who during the
preceding calendar month has acquired title to or possession of
cigarettes for use or storage in this state, upon which
cigarettes the tax imposed by sections 297.01 to 297.13 has not
been paid, shall file a return with the commissioner showing the
quantity of cigarettes so acquired. The return shall be made
upon a form furnished and prescribed by the commissioner, and
shall contain such other information as the commissioner may
require. The return shall be accompanied by a remittance for
the full unpaid tax liability shown by it.
Sec. 25. Minnesota Statutes 1985 Supplement, section
297.35, subdivision 1, is amended to read:
Subdivision 1. On or before the eighteenth twenty-fifth
day of each calendar month every distributor with a place of
business in this state shall file a return with the commissioner
showing the quantity and wholesale sales price of each tobacco
product (1) brought, or caused to be brought, into this state
for sale; and (2) made, manufactured or fabricated in this state
for sale in this state, during the preceding calendar month.
Every licensed distributor outside this state shall in like
manner file a return showing the quantity and wholesale sales
price of each tobacco product shipped or transported to
retailers in this state to be sold by those retailers, during
the preceding calendar month. Returns shall be made upon forms
furnished and prescribed by the commissioner and shall contain
such other information as the commissioner may require. Each
return shall be accompanied by a remittance for the full tax
liability shown therein, less two percent of such liability as
compensation to reimburse the distributor for his expenses
incurred in the administration of sections 297.31 to 297.39.
Sec. 26. Minnesota Statutes 1984, section 297.35,
subdivision 5, is amended to read:
Subd. 5. (a) Except as provided in paragraph (b), all
taxes shall be due and payable not later than the eighteenth
twenty-fifth day of the month following the calendar month in
which they were incurred, and thereafter shall bear interest at
the rate specified in section 270.75. If any tax required to be
paid under the provisions of this section is not paid within the
time herein specified, a penalty of five percent of the unpaid
tax remaining each month up to a maximum of 25 percent is herein
imposed but in no event shall the penalty for failing to pay
such tax within the time so provided be less than $10. The
commissioner of revenue is authorized to extend the time for
paying such tax without penalty for good cause shown.
Where, under the provisions of subdivisions 2 and 3, the
amount of tax due for a given period is assessed without
allocating it to any particular month or months, the interest
shall commence to run from the date of such assessment.
The commissioner shall have power to reduce or abate the
penalty or interest when in his opinion the facts warrant such
reduction or abatement. The exercise of this power shall be
subject to the provisions of chapter 270 if the reduction or
abatement exceeds $500.
(b) Every distributor having a liability of $1,500 or more
in May 1987 or in May of each subsequent year, shall remit the
June liability in the manner required by this section.
On or before June 25, 1987, or June 25 of each subsequent
year, the distributor shall remit the actual May liability and
one-half of the estimated June liability to the commissioner and
file the return on a form prescribed by the commissioner.
On or before August 25, 1987, or August 25 of each
subsequent year, the distributor shall submit a return showing
the actual June liability and paying any additional amount of
tax not remitted in June. A penalty is imposed equal to ten
percent of the amount of June liability required to be paid in
June less the amount remitted in June. However, the penalty is
not imposed if the amount remitted in June equals the lesser of
(a) 45 percent of the actual June liability, or (b) 50 percent
of the preceding May's liability.
Sec. 27. Minnesota Statutes 1984, section 297.35,
subdivision 8, is amended to read:
Subd. 8. On or before the eighteenth twenty-fifth day of
each calendar month, every consumer who, during the preceding
calendar month, has acquired title to or possession of tobacco
products for use or storage in this state, upon which tobacco
products the tax imposed by section 297.32 has not been paid,
shall file a return with the commissioner showing the quantity
of tobacco products so acquired. The return shall be made upon
a form furnished and prescribed by the commissioner, and shall
contain such other information as the commissioner may require.
The return shall be accompanied by a remittance for the full
unpaid tax liability shown by it.
Sec. 28. [REVENUE FROM ACCELERATION.]
Notwithstanding the provisions of Minnesota Statutes,
sections 297.13, subdivision 1, and 297.32, subdivision 9, all
revenue collected in June 1987 as a result of the acceleration
under the provisions of sections 23 and 26 shall be deposited in
the general fund.
Sec. 29. [297A.151] [TAX ON LIQUOR AND BEER; DELINQUENCY.]
Subdivision 1. [POSTING, NOTICE.] Notwithstanding section
297A.43, the commissioner shall, by the 15th of each month,
submit to the commissioner of public safety a list of all permit
holders who are required to collect the tax imposed by section
297A.02, subdivision 3, and who are 30 days or more delinquent
in either filing a sales tax return or paying the sales tax. At
least ten days before notifying the commissioner of public
safety, the commissioner of revenue shall notify the permit
holder of the intended action.
The commissioner of public safety shall post the list in
the same manner as provided in section 340A.318, subdivision 3.
The list will prominently show the date of posting. If a permit
holder previously listed cures the delinquency by filing all
returns and paying all taxes, the commissioner shall notify the
commissioner of public safety within two business days that the
delinquency was cured.
Subd. 2. [SALES PROHIBITED.] Beginning the third business
day after the list is posted, no wholesaler, manufacturer, or
brewer may sell or deliver any product to a permit holder
included on the posted list.
Subd. 3. [PENALTY.] A wholesaler, manufacturer, or brewer
of intoxicating liquor who violates subdivision 2 is subject to
the penalties provided in section 340A.304.
Sec. 30. Minnesota Statutes 1984, section 297A.27, is
amended by adding a subdivision to read:
Subd. 1a. Any person required to collect the tax imposed
by section 297A.02, subdivision 3, on sales of intoxicating
liquor and nonintoxicating malt liquor, shall report the total
sales tax liability, including the sales tax on items other than
intoxicating liquor and nonintoxicating malt liquor, on a
distinct sales tax return prescribed by the commissioner. The
due date of the return will be as otherwise provided in this
chapter.
Sec. 31. Minnesota Statutes 1984, section 297A.43, is
amended to read:
297A.43 [CONFIDENTIAL NATURE OF INFORMATION.]
It shall be unlawful for the commissioner or any other
public official or employee to divulge or otherwise make known
in any manner any particulars disclosed in any report or return
required by sections 297A.01 to 297A.44, or any information
concerning the affairs of the person making the return acquired
from his records, officers, or employees while examining or
auditing under the authority of sections 297A.01 to 297A.44,
except in connection with a proceeding involving taxes due under
this chapter from the taxpayer making such report or return or
to comply with the provisions of section 297A.431 or where a
question arises as to the proper tax applicable, that is, sales
or use tax. In the latter instance, the commissioner may furnish
information to a buyer and a seller with respect to the specific
transaction in question. Nothing herein contained shall be
construed to prohibit the commissioner from publishing
statistics so classified as not to disclose the identity of
particular returns or reports and the contents thereof. Any
person violating the provisions of this section shall be guilty
of a gross misdemeanor.
The commissioner may enter into an agreement with the
commissioner or other taxing officials of another state for the
interpretation and administration of the acts of their several
states providing for the collection of a sales and/or use tax
for the purpose of promoting fair and equitable administration
of such acts and to eliminate double taxation.
Notwithstanding the above provisions of this section, the
commissioner, at his discretion, in order to implement the
purposes of this chapter, may furnish information on a
reciprocal basis to the taxing officials of another state, or to
the taxing officials of any municipality of the state of
Minnesota which has a local sales and/or use tax. The
commissioner may furnish to the Minnesota supreme court and the
board of professional responsibility information regarding the
amount of any uncontested delinquent taxes due under this
chapter or a failure to file a return due under this chapter by
an attorney admitted to practice law in this state under chapter
481.
In order to facilitate processing of returns and payments
of taxes required by this chapter, the commissioner may contract
with outside vendors and may disclose private and nonpublic data
to the vendor. The data disclosed will be administered by the
vendor consistent with this section.
Sec. 32. Minnesota Statutes 1985 Supplement, section
297C.03, subdivision 1, is amended to read:
Subdivision 1. [MANNER AND TIME OF PAYMENT; PENALTIES;
DEPOSIT OF TAX PROCEEDS.] The tax on wines and distilled spirits
on which the excise tax has not been previously paid must be
paid to the commissioner by persons having on file with the
commissioner a sufficient bond as provided in subdivision 2 on
or before the tenth twenty-fifth day of the month following the
month in which the first sale is made in this state by a
licensed manufacturer or wholesaler. Every person liable for
the tax on wines or distilled spirits imposed by section 297C.02
must file with the commissioner on or before the tenth
twenty-fifth day of the month following first sale in this state
by a licensed manufacturer or wholesaler a return in the form
prescribed by rule of the commissioner, and must keep records
and render reports required by rule of the commissioner. A
person liable for any tax on wines or distilled spirits not
having on file a sufficient bond must pay the tax within 24
hours after first sale in this state. The commissioner may
certify to the commissioner of public safety any failure to pay
taxes when due as a violation of a statute relating to the sale
of intoxicating liquor for possible revocation or suspension of
license.
If a person fails to pay the tax within the time specified
or within 30 days after final determination of an appeal to the
Minnesota tax court relating thereto, there is added a penalty
equal to ten percent of the remaining unpaid amount. The
penalty must be collected as part of the tax. The amount of tax
not timely paid, together with the penalty, must bear interest
at the rate specified in section 270.75 from the time the tax
should have been paid until it is paid.
Sec. 33. Minnesota Statutes 1985 Supplement, section
297C.04, is amended to read:
297C.04 [PAYMENT OF TAX; MALT LIQUOR.]
The commissioner shall by rule provide a reporting method
for paying and collecting the excise tax on fermented malt
beverages. The rules must require reports to be filed with and
the excise tax to be paid to the commissioner on or before the
fifteenth twenty-fifth day of the month following the month in
which the importation into or the first sale is made in this
state, whichever first occurs. The rules must also require
payments in June of 1987 and subsequent years according to the
provisions of section 297C.05, subdivision 2, paragraph (b). If
the excise tax is not paid when due, the amount due is increased
by a penalty of ten percent thereof, and interest on the tax and
penalty at an annual rate of 20 percent, adjusted as provided in
section 270.75, from the date the tax became due until paid.
Sec. 34. Minnesota Statutes 1985 Supplement, section
297C.05, subdivision 2, is amended to read:
Subd. 2. [MONTHLY TAX PAYMENTS; PENALTY FOR NONPAYMENT.]
(a) Subject to paragraph (b), all taxes shall be due and payable
as directed in this chapter, and taxes not paid shall bear
interest at the rate specified in section 270.75. The
commissioner in issuing a final assessment shall add to the
amount of tax found due and unpaid a penalty of ten percent
thereof, except that, if the commissioner finds that the
taxpayer has made a false and fraudulent return with intent to
evade the tax imposed by this chapter, the penalty shall be 25
percent of the entire tax as shown by the corrected return. If
the tax is not paid within the time herein specified for the
payment thereof or within 30 days after final determination of
an appeal to the Minnesota tax court relating thereto, there
shall be added thereto a specific penalty equal to ten percent
of the amount so remaining unpaid, but in no event shall the
penalty for failure to pay the tax within the time provided for
payment be less than $10. The commissioner may extend the time
for paying the tax without penalty for good cause shown.
(b) Every person liable for tax under this chapter having a
liability of $1,500 or more in May 1987 or in May of each
subsequent year, shall remit the June liability in the manner
required by this section.
On or before June 25, 1987, or June 25 of each subsequent
year, the taxpayer shall remit the actual May liability and
one-half of the estimated June liability to the commissioner and
file the return on a form prescribed by the commissioner.
On or before August 25, 1987, or August 25 of each
subsequent year, the taxpayer shall submit a return showing the
actual June liability and paying any additional amount of tax
not remitted in June. A penalty is hereby imposed equal to ten
percent of the amount of June liability required to be paid in
June less the amount remitted in June. However, the penalty
shall not be imposed if the amount remitted in June equals the
lesser of (a) 45 percent of the actual June liability, or (b) 50
percent of the preceding May's liability.
Sec. 35. Minnesota Statutes 1984, section 299F.21, is
amended to read:
299F.21 [FIRE INSURANCE COMPANIES TO PAY COST OF
MAINTENANCE.]
Subdivision 1. [ESTIMATED INSTALLMENT PAYMENTS.] On or
before April 15, June 15, and December 15 of each year, every
insurance company, including reciprocals, interinsurance
exchanges or Lloyds, doing business in the state, excepting
farmers' mutual fire insurance companies and township mutual
fire insurance companies, shall hereafter pay to the
commissioner of revenue on or before March 1 annually
installments equal to one-third of, a tax upon its fire premiums
or assessments or both, as follows:
A sum equal to one-half of one percent of the estimated
gross premiums and assessments, less return premiums, on all
direct business received by it in this state, or by its agents
for it, in cash or otherwise, during the preceding calendar
year, including premiums on policies covering fire risks only on
automobiles, whether written under floater form or otherwise.
In the case of a mutual company or reciprocal exchange the
dividends or savings paid or credited to members in this state
shall be construed to be return premiums. The money so received
into the state treasury shall be credited to the general fund.
If the tax prescribed by this section is not paid by March
1, annually those dates, penalties and interest as provided in
section 290.53, subdivision 1, shall be imposed.
Subd. 2. [ANNUAL RETURNS.] (a) Every insurer required to
pay a premium tax under this section shall make and file a
statement of estimated premium taxes for the period covered by
the installment tax payment. The statement shall be in the form
prescribed by the commissioner of revenue.
(b) On or before March 1, annually every insurer subject to
taxation under this section shall make an annual return for the
preceding calendar year setting forth information the
commissioner of revenue may reasonably require on forms
prescribed by the commissioner.
(c) On March 1, the insurer shall pay any additional amount
due for the preceding calendar year; if there has been an
overpayment, the overpayment may be credited without interest on
the estimated tax due April 15.
(d) If unpaid by this date, penalties and interest as
provided in section 290.53, subdivision 1, shall be imposed.
Sec. 36. Minnesota Statutes 1984, section 326.20, is
amended by adding a subdivision to read:
Subd. 4. [TAX CLEARANCE CERTIFICATE.] (a) Notwithstanding
subdivisions 1 and 2, the board may not issue or renew a license
under sections 326.165 to 326.231 if the commissioner of revenue
notifies the board and the licensee or applicant for a license
that the licensee or applicant owes the state delinquent taxes
in the amount of $500 or more. The board may issue or renew the
license only if (1) the commissioner of revenue issues a tax
clearance certificate and (2) the commissioner of revenue or the
licensee or applicant forwards a copy of the clearance to the
board. The commissioner of revenue may issue a clearance
certificate only if the licensee or applicant does not owe the
state any uncontested delinquent taxes.
(b) For purposes of this subdivision, the following terms
have the meanings given.
(1) "Taxes" are all taxes payable to the commissioner of
revenue, including penalties and interest due on those taxes.
(2) "Delinquent taxes" do not include a tax liability if
(i) an administrative or court action that contests the amount
or validity of the liability has been filed or served, (ii) the
appeal period to contest the tax liability has not expired, or
(iii) the licensee or applicant has entered into a payment
agreement to pay the liability and is current with the payments.
(c) When a licensee or applicant is required to obtain a
clearance certificate under this subdivision, a contested case
hearing must be held if the licensee or applicant requests a
hearing in writing to the commissioner of revenue within 30 days
of the date of the notice provided in paragraph (a). The
hearing must be held within 45 days of the date the commissioner
of revenue refers the case to the office of administrative
hearings. Notwithstanding any law to the contrary, the licensee
or applicant must be served with 20 days' notice in writing
specifying the time and place of the hearing and the allegations
against the licensee or applicant. The notice may be served
personally or by mail.
(d) The board shall require all licensees or applicants to
provide their social security number and Minnesota business
identification number on all license applications. Upon request
of the commissioner of revenue, the board must provide to the
commissioner of revenue a list of all licensees and applicants,
including the name and address, social security number, and
business identification number. The commissioner of revenue may
request a list of the licensees and applicants no more than once
each calendar year. Notwithstanding sections 290.61 and
297A.43, the commissioner of revenue may release information
necessary to accomplish the purpose of this subdivision.
Sec. 37. [REPEALER.]
Minnesota Statutes 1984, section 270.72, subdivision 5, is
repealed.
Sec. 38. [APPROPRIATION.]
Compliance Initiatives
FY1986 FY1987
300,000 2,974,500
Summary by Fund
FY1986 FY1987
General 216,600 1,895,400
Special 83,400 1,079,100
The commissioner of revenue may use the
general fund appropriation to fund any
of the compliance initiatives in any
program area except that this
appropriation is not available for
compliance initiatives in the corporate
income tax area.
In addition to the amounts of corporate
income tax receipts required to be
credited to the special revenue fund
pursuant to Laws 1985, First Special
Session chapter 13, section 21,
subdivision 3, an additional $83,400 of
corporate income tax receipts in the
first year and an additional $1,079,100
of corporate income tax receipts in the
second year must be credited to the
special revenue fund to be used to fund
compliance initiatives.
Sec. 39. [EFFECTIVE DATES.]
Sections 1, 4, and 35 are effective for taxes on premiums
paid after December 31, 1986. Sections 2, 3, 5 to 9, 21, 31,
36, and 37 are effective the day following final enactment.
Sections 10 to 17 are effective July 1, 1986. Section 18 is
effective for interest earned on overpayments after December 31,
1987. Section 20 is effective for taxable years beginning after
December 31, 1985. Sections 22 to 28 and 32 to 34 are effective
June 1, 1986.
ARTICLE 8
MISCELLANEOUS
Section 1. [41A.09] [ETHANOL DEVELOPMENT FUND.]
Subdivision 1. [FUND CREATED.] An ethanol development fund
is created as a separate fund in the state treasury. The
department of revenue shall administer the fund. The fund is
annually appropriated from the general fund to the commissioner
of revenue for the purposes of this section and all money so
appropriated is available until expended.
Subd. 2. [DEFINITION.] For purposes of this section
"ethanol" means agriculturally derived fermentation ethyl
alcohol of a purity of at least 99 percent, determined without
regard to any added denaturants, denatured in conformity with
one of the approved methods set forth by the United States
Department of Treasury, Bureau of Alcohol, Tobacco and Firearms,
and derived from the following agricultural products: potatoes,
cereal, grains, cheese whey, or sugar beets.
Subd. 3. [PAYMENTS FROM FUND.] The commissioner of revenue
shall make cash payments from the development fund to producers
of ethanol or agricultural grade alcohol, for use as a motor
fuel, located in the state. The amount of the payment for each
producer's annual production shall be as follows:
(a) For each gallon of ethanol produced:
(1) For the period beginning July 1, 1986 and ending June
30, 1987, 15 cents per gallon;
(2) For the period beginning July 1, 1987 and ending June
30, 1992, 20 cents per gallon.
(b) For each gallon produced of agricultural grade alcohol
of a purity of at least 50 percent but not more than 90 percent
and designed to be used in conjunction with diesel fuel in an
engine's internal combustion process, for the period beginning
July 1, 1987 and ending June 30, 1992, 11 cents per gallon.
The total payments from the fund to all producers may not
exceed $200,000 during the period beginning July 1, 1986 and
ending June 30, 1987, and may not exceed $10,000,000 in any
fiscal year during the period beginning July 1, 1987 and ending
June 30, 1992. Total payments to any producer from the fund in
any fiscal year may not exceed $3,000,000.
By the last day of October, January, April, and July, each
producer shall file a claim for payment for production during
the preceding three calendar months. The volume of production
must be verified by a certified financial audit performed by an
independent certified public accountant using generally accepted
accounting procedures.
Payments shall be made November 15, February 15, May 15,
and August 15.
Subd. 4. [RULEMAKING AUTHORITY.] The commissioner shall
adopt emergency and permanent rules to implement this section.
Subd. 5. [EXPIRATION.] This section expires July 1, 1992
and all money in the fund on that date reverts to the general
fund.
Sec. 2. Minnesota Statutes 1984, section 162.06,
subdivision 1, is amended to read:
Subdivision 1. [ESTIMATE.] On or before the second Tuesday
of January of each year the commissioner shall estimate the
probable sum of money that will accrue to the county state-aid
highway fund during the first six months of each year ending
June 30. To such estimated amounts he shall add the sum of
money already accrued in the county state-aid highway fund for
the last preceding six month period ending December 31 of each
year, adjusted to reflect the amount by which actual receipts
for the preceding January 1 to June 30 were different from
estimated receipts. The total of such sums except for
deductions to be first made as provided herein shall be
apportioned to the several counties as hereinafter provided.
Sec. 3. Minnesota Statutes 1984, section 162.12,
subdivision 1, is amended to read:
Subdivision 1. [ESTIMATE OF ACCRUALS.] On or before the
second Tuesday of January of each year the commissioner shall
estimate the probable sum of money that will accrue to the
municipal state-aid street fund during the first six months of
each year ending June 30. To the estimated amount he shall add
the sum of money already accrued in the municipal state-aid
street fund for the last preceding six-month period ending
December 31, adjusted to reflect the amount by which actual
receipts for the preceding January 1 to June 30 were different
from estimated receipts. The total of such sums, except for
deductions to be first made as provided herein, shall be
apportioned by the commissioner to the cities having a
population of 5,000 or more as hereinafter provided.
Sec. 4. [256.014] [STATE AND COUNTY SYSTEMS.]
Subdivision 1. [ESTABLISHMENT OF SYSTEMS.] The
commissioner of human services shall establish and enhance
computer systems necessary for the efficient operation of the
programs the commissioner supervises, including:
(1) management and administration of the food stamp and
income maintenance programs;
(2) the central clearinghouse project for the child support
enforcement program; and
(3) administration of medical assistance and general
assistance medical care.
The commissioner shall distribute the nonfederal share of
the costs of operating and maintaining the systems to the
commissioner and to the counties participating in the system in
a manner that reflects actual system usage. Development costs
must not be assessed against local agencies.
Subd. 2. [STATE SYSTEMS ACCOUNT CREATED.] A state systems
account is created in the state treasury. Money collected by
the commissioner of human services for the programs in
subdivision 1 must be deposited in the account. Money in the
state systems account and federal matching money is appropriated
to the commissioner of human services for purposes of this
section.
Subd. 3. [REPORT.] The commissioner of human services
shall report to the chair of the house appropriations committee
and the chair of the senate finance committee on January 1 of
each year detailing project expenditures to date, methods used
to maximize county participation, and the fiscal impact on
programs, counties, and clients.
Sec. 5. Minnesota Statutes 1985 Supplement, section
256B.06, subdivision 1, is amended to read:
Subdivision 1. Medical assistance may be paid for any
person:
(1) who is a child eligible for or receiving adoption
assistance payments under Title IV-E of the Social Security Act,
United States Code, title 42, sections 670 to 676 under
Minnesota Statutes, section 259.40 or 259.431; or
(2) who is a child eligible for or receiving foster care
maintenance payments under Title IV-E of the Social Security
Act, United States Code, title 42, sections 670 to 676; or
(3) who is eligible for or receiving public assistance
under the aid to families with dependent children program, the
Minnesota supplemental aid program; or
(4) who is a pregnant woman, as certified in writing by a
physician or nurse midwife, and who (a) meets the other
eligibility criteria of this section, and (b) would be
categorically eligible for assistance under the aid to families
with dependent children program if the child had been born and
was living with the woman; or
(5) who is a pregnant woman, as certified in writing by a
physician or nurse midwife, who meets the other eligibility
criteria of this section and whose unborn child would be
eligible as a needy child under clause (9) if born and living
with the woman; or
(6) who meets the categorical eligibility requirements of
the supplemental security income program and the other
eligibility requirements of this section; or
(7) who, except for the amount of income or resources,
would qualify for supplemental security income for the aged,
blind and disabled, or aid to families with dependent children,
and who meets the other eligibility requirements of this
section; or
(8) who is under 21 years of age and in need of medical
care that neither he nor his relatives responsible under
sections 256B.01 to 256B.26 are financially able to provide; or
(9) who is an infant less than one year of age born on or
after October 1, 1984, whose mother was eligible at the time of
birth and who remains in the mother's household. Eligibility
under this clause is concurrent with the mother's and does not
depend on the father's income except as the income affects the
mother's eligibility; or
(10) who is residing in a hospital for treatment of mental
disease or tuberculosis and is 65 years of age or older and
without means sufficient to pay the per capita hospital charge;
and
(11) who resides in Minnesota, or, if absent from the
state, is deemed to be a resident of Minnesota in accordance
with the regulations of the state agency; and
(12) who alone, or together with his spouse, does not own
real property other than the homestead. For the purposes of
this section, "homestead" means the house owned and occupied by
the applicant or recipient as his primary place of residence,
together with the contiguous land upon which it is situated.
The homestead shall continue to be excluded for persons residing
in a long-term care facility if it is used as a primary
residence by the spouse, minor child, or disabled child of any
age; or the applicant/recipient is expected to return to the
home as a principal residence within six calendar months of
entry to the long-term care facility. Certification of expected
return to the homestead shall be documented in writing by the
attending physician. Real estate not used as a home may not be
retained unless it produces net income applicable to the
family's needs or the family is making a continuing effort to
sell it at a fair and reasonable price or unless the
commissioner determines that sale of the real estate would cause
undue hardship or unless the equity in the real estate when
combined with the equity in the homestead totals $15,000 or
less; and
(13) who individually does not own more than $3,000 in cash
or liquid assets, or if a member of a household with two family
members (husband and wife, or parent and child), does not own
more than $6,000 in cash or liquid assets, plus $200 for each
additional legal dependent. In addition to these maximum
amounts, an eligible individual or family may accrue interest on
these amounts, but they must be reduced to the maximum at the
time of an eligibility redetermination. For residents of
long-term care facilities, the accumulation of the clothing and
personal needs allowance pursuant to section 256B.35 must also
be reduced to the maximum at the time of the eligibility
redetermination. Cash and liquid assets may include a prepaid
funeral contract and insurance policies with cash surrender
value. The value of the following shall not be included:
(a) the homestead, and (b) one motor vehicle licensed
pursuant to chapter 168 and defined as: (1) passenger
automobile, (2) station wagon, (3) motorcycle, (4) motorized
bicycle or (5) truck of the weight found in categories A to E,
of section 168.013, subdivision 1e; and
(14) who has or anticipates receiving an annual income not
in excess of the income standards by family size used in the aid
to families with dependent children program, or who has income
in excess of these maxima and in the month of application, or
during the three months prior to the month of application,
incurs expenses for medical care that total more than one-half
of the annual excess income in accordance with the regulations
of the state agency. Notwithstanding any laws or rules to the
contrary, in computing income to determine eligibility of
persons who are not residents of long-term care facilities, the
commissioner shall disregard increases in income due solely to
increases in federal retiree, survivor's, and disability
insurance benefits, veterans administration benefits, and
railroad retirement benefits in the percentage amount
established in the biennial appropriations law unless prohibited
by federal law or regulation. If prohibited, the commissioner
shall first seek a waiver as required by Public Law No. 94-566,
section 503. In excess income cases, eligibility shall be
limited to a period of six months beginning with the first of
the month in which these medical obligations are first incurred;
and
(15) who has continuing monthly expenses for medical care
that are more than the amount of his excess income, computed on
a monthly basis, in which case eligibility may be established
before the total income obligation referred to in the preceding
paragraph is incurred, and medical assistance payments may be
made to cover the monthly unmet medical need. In licensed
nursing home and state hospital cases, income over and above
that required for justified needs, determined pursuant to a
schedule of contributions established by the commissioner of
human services, is to be applied to the cost of institutional
care. The commissioner of human services may establish a
schedule of contributions to be made by the spouse of a nursing
home resident to the cost of care; and
(16) who has applied or agrees to apply all proceeds
received or receivable by him or his spouse from automobile
accident coverage and private health care coverage to the costs
of medical care for himself, his spouse, and children. The
state agency may require from any applicant or recipient of
medical assistance the assignment of any rights accruing under
private health care coverage. Any rights or amounts so assigned
shall be applied against the cost of medical care paid for under
this chapter. Any assignment shall not be effective as to
benefits paid or provided under automobile accident coverage and
private health care coverage prior to receipt of the assignment
by the person or organization providing the benefits.
Sec. 6. [270.069] [COMMISSIONER TO COLLECT CERTAIN LOCAL
TAXES.]
Subdivision 1. [COSTS DEDUCTED; APPROPRIATION.] If the
commissioner of revenue agrees to collect a locally imposed tax,
the local unit of government must agree that all the direct and
indirect costs of the department of revenue for collecting the
tax and any other statewide indirect costs will be deducted from
the amounts collected and paid to the local unit of government.
The amounts deducted must be deposited in the state treasury and
credited to a local tax collection account. Money in the
account is appropriated to the commissioner of revenue to
collect the locally imposed tax.
Subd. 2. [DEVELOPMENT COSTS.] If the commissioner
determines that a new computer system will be required to
collect the locally imposed taxes, the costs of development of
the system will be charged to the first local units of
government to be included in the system. Any additional local
units of government that by agreement are added to the system
will be charged for a share of the development costs. The
charge will be determined by the commissioner who shall then
refund to the original local units of government their portion
of the development costs recovered from the additional users.
The amounts necessary to make the refunds are appropriated from
the local tax collection account to the commissioner of revenue.
Sec. 7. Minnesota Statutes 1984, section 270A.03,
subdivision 5, is amended to read:
Subd. 5. "Debt" means a legal obligation of a natural
person to pay a fixed and certain amount of money, which equals
or exceeds $25 and which is due and payable to a claimant
agency. The term includes criminal fines imposed under section
609.10. A debt may arise under a contractual or statutory
obligation, a court order, or other legal obligation, but need
not have been reduced to judgment. A debt does not include (1)
any legal obligation of a current recipient of assistance which
is based on overpayment of an assistance grant, or (2) any legal
obligation to pay a claimant agency for medical care, including
hospitalization if the debtor would have qualified for a low
income credit equal to tax liability pursuant to Minnesota
Statutes 1984, section 290.06, subdivision 3d, clause (1), at
the time when the medical care was rendered, provided that, for
purposes of this subdivision, the income amounts in that section
shall be adjusted for inflation for debts incurred in calendar
years 1987 and thereafter. The dollar amount of each income
level that applied to debts incurred in the prior year shall be
increased in the same manner as provided in section 290.06,
subdivision 2d, for the expansion of the tax rate brackets.
Sec. 8. Minnesota Statutes 1985 Supplement, section
273.1314, subdivision 6, is amended to read:
Subd. 6. [LOCAL CONTRIBUTION.] No area may be designated
as an enterprise zone unless the municipality agrees to make a
qualifying local contribution in the form of a property tax
reduction for employment property as provided by section
273.1313 for any business qualifying for a state tax reduction
pursuant to this section. A qualifying local contribution may
in the alternative be a local contribution or investment out of
other municipal funds, but excluding any special federal grants
or loans, equivalent to the property tax reduction. In
concluding the agreement with the municipality the commissioner
may require that the local contribution will be made in a
specified ratio to the amount of the state credits authorized.
If the local contribution is to be used to fund additional
reductions in state taxes, the commissioner and the governing
body of the municipality shall enter an agreement for timely
payment to the state to reimburse the state for the amount of
tax revenue foregone as a result. The qualifying local
contribution for a special enterprise zone under section
273.1312, subdivision 4, paragraph (c), clause (4), shall be the
complete abatement of property taxes on property in the
zone. The qualifying local contribution for development within
the portion of an enterprise zone that is located in a town that
has been added by boundary amendment to an enterprise zone that
is located within five municipalities and was designated in 1984
shall be provided by the town.
Sec. 9. Minnesota Statutes 1985 Supplement, section
273.1314, subdivision 16a, as amended by Laws 1986, chapter 465,
article 2, section 3, is amended to read:
Subd. 16a. [ZONE BOUNDARY REALIGNMENT.] The commissioner
may approve specific applications by a municipality to amend the
boundaries of a zone or of an area or areas designated pursuant
to subdivision 9, paragraph (e) at any time. Boundaries of a
zone may not be amended to create noncontiguous subdivisions.
If the commissioner approves the amended boundaries, the change
is effective on the date of approval. Notwithstanding the area
limitation under section 273.1312, subdivision 4, paragraph (b),
the commissioner may approve a specific application to amend the
boundaries of an enterprise zone which is located within five
municipalities and was designated in 1984, to increase its area
to not more than 800 acres, and may approve an additional
specific application to amend the boundaries of that enterprise
zone to include a sixth municipality or to further increase its
area to include all or part of the territory of a town that
surrounds one of the five municipalities, or both.
Sec. 10. Minnesota Statutes 1985 Supplement, section
296.02, subdivision 7, is amended to read:
Subd. 7. [TAX REDUCTION FOR AGRICULTURAL ALCOHOL
GASOLINE.] A distributor shall be allowed a credit on each
gallon of fuel grade alcohol commercially blended with gasoline
or blended in a tank trunk with gasoline on which the tax
imposed by subdivision 1 is due and payable. The amount of the
credit is 40 cents for every gallon of fuel-grade alcohol
blended with gasoline to produce agricultural alcohol
gasoline is as follows:
(a) For the fiscal year ending June 30, 1987, 25 cents.
(b) On and after July 1, 1987, 20 cents.
The credit allowed a distributor must not exceed the total
tax liability under subdivision 1. The tax credit received by a
distributor on alcohol blended with motor fuels shall be passed
on to the retailer.
Sec. 11. Minnesota Statutes 1985 Supplement, section
296.22, subdivision 13, is amended to read:
Subd. 13. [GASOLINE-ALCOHOL BLENDS; IDENTIFICATION.] When
gasoline blended with alcohol is sold, offered for sale, or
dispensed for use in motor vehicles, the dispenser shall be
clearly marked to identify each type of alcohol, if more than
one percent by volume, blended with the gasoline. The marking
shall consist of a white or yellow adhesive decal not less than
two inches by six inches with clearly printed black lettering
not less than one-half inch high and one-eighth inch in stroke.
The marking shall be conspicuously displayed on the front side
both sides of the dispenser and state that the gasoline
"CONTAINS ETHANOL" or "CONTAINS METHANOL" or has
been improved "WITH ETHANOL ENRICHMENT ENRICHED." This
subdivision does not prohibit the posting of other alcohol or
additive information.
Sec. 12. Minnesota Statutes 1984, section 297B.09,
subdivision 2, is amended to read:
Subd. 2. [HIGHWAY USER TAX DISTRIBUTION FUND AND TRANSIT
ASSISTANCE FUND SHARE.] The proceeds collected under this
chapter must be deposited in the highway user tax distribution
fund and the transit assistance fund for apportionment in the
following manner:
(a) None of the proceeds collected before July 1, 1984, or
between July 1, 1985, and June 30, 1987, may be credited to
either fund.
(b) 18.75 percent of the proceeds collected after June 30,
1984, and before July 1, 1987 1985, must be credited to the
highway user tax distribution fund for apportionment in the same
manner and for the same purposes as other money in that fund.
The remaining 6.25 percent of the proceeds must be credited to
the transit assistance fund to be appropriated to the
commissioner of transportation for transit assistance within the
state.
(c) Except as provided in paragraph (f), 37.5 percent of
the proceeds collected after June 30, 1987, and before July 1,
1989, must be credited to the highway user tax distribution fund
for apportionment in the same manner and for the same purposes
as other money in that fund. The remaining 12.5 percent of the
proceeds must be credited to the transit assistance fund to be
appropriated to the commissioner of transportation for transit
assistance within the state.
(d) Except as provided in paragraph (f), 56.25 percent of
the proceeds collected after June 30, 1989, and before July 1,
1991, must be credited to the highway user tax distribution fund
for apportionment in the same manner and for the same purposes
as other money in that fund. The remaining 18.75 percent of the
proceeds must be credited to the transit assistance fund to be
appropriated to the commissioner of transportation for transit
assistance within the state.
(e) Except as provided in paragraph (f), 75 percent of the
proceeds collected after June 30, 1991, must be credited to the
highway user tax distribution fund for apportionment in the same
manner and for the same purposes as other money in that fund.
The remaining 25 percent of the proceeds must be credited to the
transit assistance fund to be appropriated to the commissioner
of transportation for transit assistance within the state.
(f) The distributions under paragraphs (c), (d), and (e) to
the highway user tax distribution fund shall be reduced by the
amount necessary to fund the appropriation under section 1,
subdivision 1.
Sec. 13. Minnesota Statutes 1985 Supplement, section
297C.02, is amended by adding a subdivision to read:
Subd. 4. [BOTTLE TAX.] A tax of one cent is imposed on
each bottle or container of distilled spirits and wine. The
wholesaler is responsible for the payment of this tax when the
bottles of distilled spirits and wine are removed from inventory
for sale, delivery, or shipment.
The following are exempt from the tax:
(1) miniatures of distilled spirits;
(2) containers of fermented malt beverage;
(3) containers of intoxicating liquor or wine holding less
than 200 milliliters;
(4) containers of wine intended exclusively for sacramental
purposes;
(5) containers of alcoholic beverages sold to qualified,
approved military clubs;
(6) containers of alcoholic beverages sold to common
carriers engaged in interstate commerce;
(7) containers of alcoholic beverages sold to authorized
food processors or pharmaceutical firms for use exclusively in
the manufacturing of food products or medicines;
(8) containers of alcholic beverages sold and shipped to
dealers, wineries, or distillers in other states; and
(9) containers of alcoholic beverages sold to other
Minnesota wholesalers.
Sec. 14. [458.091] [COMPLIANCE EXAMINATIONS; FINANCIAL
AUDITS.]
Subdivision 1. [COMPLIANCE EXAMINATIONS.] At the request
of the city or upon the auditor's initiative, the state auditor
may make a legal compliance examination of the authority for
that city. Each authority examined must pay the total cost of
the examination, including the salaries paid to the examiners
while actually engaged in making the examination. The state
auditor may bill monthly or at the completion of the audit. All
collections received must be deposited in the revolving fund of
the state auditor. For purposes of this section "authority"
means a port authority created under chapter 458 or any other
law.
Subd. 2. [AUDITS.] The financial statements of the
authority must be prepared, audited, filed, and published or
posted in the manner required for the financial statements of
the city that established the authority. The financial
statements must permit comparison and reconciliation with the
city's accounts and financial reports. The report must be filed
with the state auditor by June 30 of each year. The auditor
shall review the report and may accept it or, in the public
interest, audit the books of the authority.
Sec. 15. Minnesota Statutes 1985 Supplement, section
609.101, is amended to read:
609.101 [SURCHARGE ON FINES, ASSESSMENTS.]
When a court sentences a person convicted of a felony,
gross misdemeanor, or misdemeanor, other than a petty
misdemeanor such as a traffic or parking violation, and if the
sentence does not include payment of a fine, the court shall
impose an assessment of not less than $20 nor more than $40. If
the sentence for the felony, gross misdemeanor, or misdemeanor
includes payment of a fine of any amount, including a fine of
less than $100, the court shall impose a surcharge on the fine
of ten percent of the fine. This section applies whether or not
the person is sentenced to imprisonment and when the sentence is
suspended. The court may, upon a showing of indigency or undue
hardship upon the convicted person or his immediate family,
waive payment or authorize payment of the assessment or
surcharge in installments.
The court shall collect and forward to the commissioner of
finance the total amount of the assessment or surcharge and the
commissioner shall credit all money so forwarded to the general
fund for the purposes of providing services, assistance, or
reparations or a combination, to victims of crimes through
programs established under sections 611A.21 to 611A.36, under
chapters 256D and 299B a crime victim and witness account, which
is established as a special account in the state treasury.
Money credited to the crime victim and witness account may
be appropriated for but is not limited to the following purposes:
(1) use for crime victim reparations under sections 611A.51
to 611A.68;
(2) use by the crime victim and witness advisory council
established under section 611A.71; and
(3) to supplement the federally funded activities of the
crime victim ombudsman under section 611A.74.
If the convicted person is sentenced to imprisonment, the
chief executive officer of the correctional facility in which
the convicted person is incarcerated may collect the assessment
or surcharge from any earnings the inmate accrues for work
performed in the correctional facility and forward the amount to
the commissioner of finance.
Sec. 16. [MOTOR VEHICLE EXCISE TAX TRANSFER.]
Notwithstanding any law to the contrary, tax proceeds under
chapter 297B and the investment earnings on those proceeds
credited to the highway user tax distribution fund and the
transit assistance fund for the period after June 30, 1985, and
before July 1, 1986, must be returned to the general fund on
June 30, 1986.
Sec. 17. [APPROPRIATION.]
$120,000 is appropriated from the general fund for fiscal
years 1986 and 1987 to the commissioner of revenue for purposes
of contracting with a vendor to prepare and merge federal income
tax, demographic, economic and other data with state income tax
data to provide a comprehensive sample of data suitable for use
in empirical tax policy research and to acquire computer
programs or software or modifications to existing state computer
software designed to be used with the data sample.
The data sample must be made available to legislative staff
in a manner that complies with the requirements of Minnesota
Statutes, section 290.61, except that a formal request of a
majority of the members of the tax committees is not required.
The commissioner of revenue may enter into a contract to
carry out the purposes of this section without publication of
notice, the requirements of competitive bidding or other
procedural requirements for state contracts, notwithstanding the
provisions of Minnesota Statutes, chapter 16B or any other law
to the contrary.
Sec. 18. [MASS TRANSIT.]
$12,235,000 in fiscal year 1986 and $9,365,000 in fiscal
year 1987 is appropriated from the general fund to the
commissioner of transportation for transit assistance.
Sec. 19. [REPEALER.]
Minnesota Statutes 1985 Supplement, section 290.06,
subdivision 2f, is repealed.
Sec. 20. [EFFECTIVE DATE.]
Section 7 is effective for medical care rendered after June
28, 1985. Sections 1, 10, and 11 are effective July 1, 1986.
Section 13 is effective August 1, 1985. Section 14 is effective
the day following final enactment. Section 16 is effective June
30, 1986. Section 19 is effective January 1, 1986. Section 15
is effective July 1, 1987.
ARTICLE 9
ELEMENTARY AND SECONDARY EDUCATION
Section 1. Minnesota Statutes 1984, section 123.71,
subdivision 1, is amended to read:
Subdivision 1. Every school board shall, no later than
September 1 October 1, publish the revenue and expenditure
budgets submitted to the commissioner of education in accordance
with section 121.908, subdivision 4, for the current year and
the actual revenues, expenditures, fund balances for the prior
year and projected fund balances for the current year in a form
prescribed by the state board of education after consultation
with the advisory council on uniform financial accounting and
reporting standards. The forms prescribed shall be designed so
that year to year comparisons of revenue, expenditures and fund
balances can be made. These budgets, reports of revenue,
expenditures and fund balances shall be published in a qualified
newspaper of general circulation in the district.
Sec. 2. Minnesota Statutes 1985 Supplement, section
124.17, subdivision 1a, is amended to read:
Subd. 1a. [AFDC PUPIL UNITS.] In addition to the pupil
units counted under subdivision 1, pupil units shall be counted
as provided in this subdivision, beginning with the 1986-1987
school year.
(1) Each pupil in subdivision 1 from a family receiving aid
to families with dependent children or its successor program who
is enrolled in the school district on October 1 of the previous
school year shall be counted as an additional five-tenths pupil
unit.
(2) In every district in which the number of pupils from
families receiving aid to families with dependent children or
its successor program equals six percent or more of the actual
pupil units in the district for the same year as computed in
subdivision 1, each such pupil shall be counted as an additional
one-tenth of a pupil unit for each percent of concentration over
five percent of such pupils in the district. The percent of
concentration shall be rounded down to the nearest whole percent
for this paragraph. In districts in which the percent of
concentration is less than six, additional pupil units must not
be counted under this paragraph for pupils from families
receiving aid to families with dependent children or its
successor program. A pupil must not be counted as more than
1-1/10 additional pupil units under this subdivision. The
weighting in this paragraph is in addition to the weighting
provided in subdivision 1 and paragraph (1).
Sec. 3. Minnesota Statutes 1985 Supplement, section
124.195, subdivision 11, is amended to read:
Subd. 11. [NONPUBLIC AIDS.] The state shall pay to each
school district 85 percent, unless a higher rate has been
established according to section 121.904, subdivision 4d, of its
aid according to sections 123.931 to 123.947 for pupils
attending nonpublic schools and nonpublic by October 31 of each
fiscal year. If a payment advance to meet cash flow needs is
requested by a district and approved by the commissioner, the
state shall pay basic transportation aid requested by a district
and approved by the commissioner according to sections 123.931
to 123.947 section 124.225, subdivision 8b attributable to
pupils attending nonpublic schools by October 31. The final aid
distribution shall be made by October 31 of the following school
year. This subdivision applies to both the final adjustment
payment for the prior fiscal year and the payment for the
current fiscal year, as established in subdivision 10.
Sec. 4. Minnesota Statutes 1985 Supplement, section
124.2161, subdivision 6, is amended to read:
Subd. 6. [F.I.C.A. INFLATION FACTOR.] "F.I.C.A. inflation
factor" means a factor to be multiplied by a district's F.I.C.A.
obligations for the base year. For the base year of fiscal year
1985, the F.I.C.A. inflation factor shall be 1.1806 1.1599. For
base years after fiscal year 1985, the F.I.C.A. inflation factor
shall be equal to the foundation aid formula allowance for the
current year, divided by the foundation aid formula allowance
for the base year.
Sec. 5. Minnesota Statutes 1985 Supplement, section
124.2162, subdivision 2, is amended to read:
Subd. 2. [AID.] Beginning in fiscal year 1987, the state
shall pay each district for each fiscal year, teacher retirement
and F.I.C.A. aid in the amount of the teacher retirement and
F.I.C.A. aid allowance under subdivision 1 times the number of
pupils in average daily membership in the district for the
current school year. However, in no case shall the amount of
aid paid to a district for any fiscal year exceed the sum of the
district's teacher retirement obligations and F.I.C.A.
obligations for that year. The revenue received from these
payments shall be recognized in the appropriate funds of the
district in proportion to the related expenditures from each
fund.
Sec. 6. Minnesota Statutes 1985 Supplement, section
124.2163, subdivision 2, is amended to read:
Subd. 2. [AID.] Each year beginning with fiscal year 1987,
the state shall pay teacher retirement and F.I.C.A. aid to
intermediate school districts, joint vocational technical school
districts, and other employing units equal to the district's or
employing unit's aid under subdivision 1. However, in no case
shall the amount of aid paid to an intermediate school district,
joint vocational technical school district, or the employing
unit exceed the sum of the intermediate school district, joint
vocational technical school district, or other employing unit's
teacher retirement obligations and F.I.C.A. obligations for that
year. The revenue received from these payments shall be
recognized in the appropriate funds of the intermediate school
districts, joint vocational technical school districts, and
other employing units in proportion to the related expenditures
from each fund.
Sec. 7. Minnesota Statutes 1985 Supplement, section
124.225, subdivision 7b, is amended to read:
Subd. 7b. [INFLATION FACTORS.] The adjusted authorized
predicted cost per FTE determined for a district under
subdivision 7a for the base year shall be increased by 10.3
percent to determine the district's aid entitlement per FTE for
the 1984-1985 school year, by 8.9 percent to determine the
district's aid entitlement per FTE for the 1985-1986 school
year, and by 6.7 6.0 percent to determine the district's aid
entitlement per FTE for the 1986-1987 school year.
Sec. 8. Minnesota Statutes 1985 Supplement, section
124.225, subdivision 10, is amended to read:
Subd. 10. [DEPRECIATION.] Any school district which owns
school buses or mobile units shall transfer annually from the
unappropriated fund balance account in its transportation fund
to the appropriated fund balance account for bus purchases in
its transportation fund at least an amount equal to 12-1/2
percent of the original cost of each type one or type two bus or
mobile unit until the original cost of each type one or type two
bus or mobile unit is fully amortized, plus 20 percent of the
original cost of each type three bus included in the district's
authorized cost under the provisions of subdivision 1, clause
(b)(4), until the original cost of each type three bus is fully
amortized, plus 33-1/3 percent of the cost to the district as of
July 1 of each year for school bus reconditioning done by the
department of corrections until the cost of the reconditioning
is fully amortized; provided, if the district's transportation
aid is reduced pursuant to subdivision 8a because the
appropriation for that year is insufficient, this amount shall
be reduced in proportion to the reduction pursuant to
subdivision 8a as a percentage of the sum of
(1) the district's total transportation aid without the
reduction pursuant to subdivision 8a, plus
(2) for fiscal years 1985 and 1986 an amount equal to 1.75
mills times the adjusted assessed valuation of the district for
the preceding year, and for fiscal year 1987 and thereafter,
2.25 mills times the adjusted assessed valuation of the district
for the preceding year, plus
(3) the district's contract services aid reduction under
subdivision 8k, plus
(4) the district's nonregular transportation levy
limitation under section 275.125, subdivision 5c.
Sec. 9. Minnesota Statutes 1985 Supplement, section
124.245, subdivision 1, is amended to read:
Subdivision 1. [BASIC COMPUTATION.] (a) Each year the
state shall pay a school district the difference by which an
amount equal to $90 per $130 times the total pupil unit units in
that school year or, in districts where the number of actual
pupil units has increased from the prior year, $95 per pupil
unit in that school year, exceeds the amount raised by seven
nine mills times the adjusted assessed valuation of the taxable
property in the district for the preceding used to compute the
levy attributable to the same year. To qualify for aid pursuant
to this subdivision in any school year, a district must have
levied seven EARC mills for use for capital expenditures in that
year levy pursuant to section 275.125, subdivision 11a for use
in that year.
(b) The aid under clause (a) for any district which
operates an approved secondary vocational education program or
an approved senior secondary industrial arts program shall be
computed using a dollar amount per pupil unit which is $5 higher
than the amount specified in clause (a).
(c) If the sum of a district's capital expenditure levy
under section 275.125, subdivision 11a, attributable to any
school year and its capital expenditure equalization aid, if
any, under this subdivision for that school year exceeds $90 per
pupil unit or, in districts where the number of actual pupil
units has increased from the prior year, $95 per pupil unit, the
amount of the excess may be expended only for the purpose of
capital expenditures for equipment for secondary vocational
education programs or senior secondary industrial arts programs.
Sec. 10. Minnesota Statutes 1985 Supplement, section
124.245, subdivision 3, is amended to read:
Subd. 3. [HAZARDOUS SUBSTANCE COMPUTATION.] The state
shall pay a school district the difference by which an amount
equal to $25 per times the total pupil unit units exceeds the
amount raised by two mills times the adjusted assessed valuation
of the taxable property in the district for the preceding used
to compute the levy attributable to the same year. To qualify
for aid pursuant to this subdivision in any school year, a
district must levy pursuant to section 275.125, subdivision 11c
for use in that year. Aid paid pursuant to this subdivision may
be used only for the purposes for which the proceeds of the levy
authorized in section 275.125, subdivision 11c may be used.
Sec. 11. Minnesota Statutes 1985 Supplement, section
124.271, subdivision 2b, is amended to read:
Subd. 2b. [AID; 1985, 1986, 1987, 1988 AND AFTER.] (1)
Each fiscal year a district which is operating a community
education program in compliance with rules promulgated by the
state board shall receive community education aid. For fiscal
year 1985, the aid shall be an amount equal to the difference
obtained by subtracting
(a) an amount equal to .8 mill times the adjusted assessed
valuation used to compute the community education levy
limitation for the levy attributable to that school year, from
(b) the greater of
$7,000, or
$5 times the population of the district.
For fiscal year 1986, the aid shall be an amount equal to
the difference obtained by subtracting
(a) an amount equal to .8 mill times the adjusted assessed
valuation used to compute the community education levy
limitation for the levy attributable to that school year, from
(b) the greater of
$7,000, or
$5.25 times the population of the district.
For fiscal year 1987 and each year thereafter, the aid
shall be an amount equal to the difference obtained by
subtracting
(a) an amount equal to .8 mill times the adjusted assessed
valuation used to compute the community education levy
limitation for the levy attributable to that school year, from
(b) the greater of
$7,140, or
$5.35 times the population of the district.
For fiscal year 1988 and each year thereafter, the aid
shall be an amount equal to the difference obtained by
subtracting
(a) an amount equal to .8 mill times the adjusted assessed
valuation used to compute the community education levy
limitation for the levy attributable to that school year, from
(b) the greater of
$7,340, or
$5.50 times the population of the district.
(2) However, for any district which certifies less than the
maximum permissible levy under the provisions of section
275.125, subdivision 8, clause (1), the district's community
education aid under clause (1) of this subdivision shall be
reduced by multiplying the aid amount computed pursuant to
clause (1) of this subdivision by the ratio of the district's
actual levy under section 275.125, subdivision 8, clause (1), to
its maximum permissible levy under section 275.125, subdivision
8, clause (1). For purposes of computing the aid reduction
pursuant to this clause, the amount certified pursuant to
section 275.125, subdivision 8, clause (1), shall not reflect
reductions made pursuant to section 275.125, subdivision 9.
(3) In addition to the amount in clause (1), in fiscal year
1985 a district which makes a levy for community education
programs pursuant to section 275.125, subdivision 8, shall
receive additional aid of 50 cents per capita.
Sec. 12. Minnesota Statutes 1985 Supplement, section
124.573, subdivision 2, is amended to read:
Subd. 2. [SALARIES AND TRAVEL.] The eligible expenses for
secondary vocational aid are: (1) the salaries paid to
essential, licensed personnel in that school year for services
rendered in that district's or center's approved secondary
vocational education programs; (2) the costs of necessary travel
between instructional sites by secondary vocational education
teachers; and (3) the costs of necessary travel by secondary
vocational education teachers accompanying students to and from
vocational student organization meetings held within the state
for educational purposes. The state shall pay to any district
or cooperative center 41.5 percent of the eligible
expenses incurred in an approved secondary vocational program
for each school year. The commissioner may withhold all or any
portion of this aid for a secondary vocational education program
which receives funds from any other source. In no event shall a
district or center receive a total amount of state aid pursuant
to this section which, when added to funds from other sources,
will provide the program an amount for salaries and travel which
exceeds 100 percent of the amount of its expenditures for
salaries and travel in the program.
Sec. 13. Minnesota Statutes 1984, section 124.573,
subdivision 3, is amended to read:
Subd. 3. [COMPLIANCE WITH RULES.] This aid shall be paid
only for services rendered or for the costs designated in
subdivision 2 which are incurred in secondary vocational
education programs approved by the state department of education
and operated in accordance with rules promulgated by the state
board of education. These rules shall provide minimum
student-staff ratios required for a secondary vocational
education program in a cooperative center to qualify for this
aid. The rules shall not require any minimum number of
administrative staff, any minimum period of coordination time or
extended employment for secondary vocational education
personnel, or the availability of vocational student activities
or organizations for a secondary vocational education program to
qualify for this aid. The requirement in these rules that
program components be available for a minimum number of hours
shall not be construed to prevent pupils from enrolling in
secondary vocational education courses on an exploratory basis
for less than a full school year. The state board of education
shall not require a school district to offer more than four
credits or 560 hours of vocational education course offerings in
any school year. Rules relating to secondary vocational
education programs shall not incorporate the provisions of the
state plan for vocational education by reference. This aid
shall be paid only for services rendered and for travel costs
incurred by essential, licensed personnel who meet the work
experience requirements for licensure pursuant to the rules of
the state board of education. Notwithstanding section 124.15,
the commissioner may modify or withdraw the program or aid
approval and withhold aid under this section without proceeding
under section 124.15 at any time. To do so, the commissioner
must determine that the program does not comply with rules of
the state board or that any facts concerning the program or its
budget differ from the facts in the district's approved
application.
Sec. 14. Minnesota Statutes 1984, section 124.32,
subdivision 1c, is amended to read:
Subd. 1c. [FOUNDATION AID FORMULA ALLOWANCE.] For purposes
of this section, "foundation aid formula allowance" shall have
the meaning attributed to it in section 124A.02, subdivision 9,
and "summer school revenue allowance" shall have the meaning
attributed to it in section 124.201. For the purposes of
computing foundation aid formula allowances pursuant to this
section, each handicapped child shall be counted as prescribed
in section 124.17, subdivision 1, clause (1) or (2).
Sec. 15. Minnesota Statutes 1985 Supplement, section
124A.02, subdivision 9, is amended to read:
Subd. 9. [FORMULA ALLOWANCE.] "Foundation aid formula
allowance" or "formula allowance" means the amount of revenue
per pupil unit used in the computation of foundation aid for a
particular school year and in the computation of permissible
levies for use in that school year. The formula allowance shall
be $1,475 for the 1983 payable 1984 levies and for foundation
aid for the 1984-1985 school year. The formula allowance shall
be $1,585 for the 1984 payable 1985 levies and for foundation
aid for the 1985-1986 school year. The formula allowance shall
be $1,690 for the 1985 payable 1986 levies and for foundation
aid for the 1986-1987 school year. The formula allowance is
$1,700 for the 1986 payable 1987 levies and for foundation aid
for the 1987-1988 school year.
Sec. 16. Minnesota Statutes 1984, section 124A.02,
subdivision 15, is amended to read:
Subd. 15. [PUPIL UNITS, ACTUAL.] "Actual pupil units"
means pupil units identified in section 124.17, subdivision 1,
clauses (1) and (2).
Sec. 17. Minnesota Statutes 1985 Supplement, section
124A.03, subdivision 1a, is amended to read:
Subd. 1a. [ESTABLISHMENT OF BASIC MAINTENANCE MILL RATE.]
(a) The commissioner of revenue shall establish the basic
maintenance mill rate and certify it to the commissioner of
education by August 1 of each year for levies payable in the
following year. The established basic maintenance mill rate
shall be a rate, rounded up to the nearest tenth of a mill,
which when applied to the adjusted assessed valuation of taxable
property for each school district under subdivision 1 or 3, as
applicable, raises the total amount specified in this section.
(b) The basic maintenance mill rate for the 1985 payable
1986 levies and for foundation aid for the 1986-1987 school year
shall be established at a rate that raises a total of
$702,000,000. The basic maintenance mill rate for the 1986
payable 1987 levies and for foundation aid for the 1987-1988
school year shall be set at a rate that raises $692,000,000.
The basic maintenance mill rate computed by the commissioner of
revenue must not be recomputed due to changes or corrections
made in a school district's adjusted assessed valuation after
the mill rate has been certified to the department of education
pursuant to paragraph (a).
Sec. 18. Minnesota Statutes 1985 Supplement, section
129B.38, subdivision 1, is amended to read:
Subdivision 1. [AID AMOUNT.] A district that purchases or
leases courseware packages that qualify as high quality
according to section 129B.37 shall receive state aid for the
1985-1986 school year. The aid shall be equal to the lesser of:
(a) $1 50 cents times the number of pupils in average daily
membership for the 1984-1985 school year; or
(b) 25 percent of the actual expenditures of the district
for purchase or lease of the courseware packages between July 1,
1985, and May 31, 1987 1986.
Sec. 19. Minnesota Statutes 1985 Supplement, section
275.125, subdivision 8, is amended to read:
Subd. 8. [COMMUNITY EDUCATION LEVY.] (1) Each year, a
district which has established a community education advisory
council pursuant to section 121.88, may levy the amount raised
by .8 mill times the most recent adjusted assessed valuation of
the district, but no more than the greater of
$5.35 $5.50 times the population of the district, or
$7,140 $7,340.
(2) In addition to the levy authorized in clause (1), in
1983 each year a district may levy an additional amount for
community education programs equal to the difference obtained by
subtracting
(a) the sum in fiscal year 1984 of
(i) the district's estimated maximum permissible revenue
for fiscal year 1985 from community education aid under section
124.271, subdivision 2b, clause (1), and
(ii) the community education levy authorized in clause (1)
of this subdivision, from
(b) the sum in fiscal year 1983 of
(i) the district's maximum permissible revenue from
community education aid under Minnesota Statutes 1984, section
124.271, subdivision 2, excluding any reductions from community
education aid made pursuant to Laws 1981, Third Special Session
chapter 2, article 2, section 2, clause (mm), and Laws 1982,
Third Special Session chapter 1, article 3, section 6, and
(ii) the maximum community education levy authorized in
this subdivision for the district for the levy made in 1981,
payable in 1982, before any reduction in the levy pursuant to
subdivision 9.
(3) Each year, in addition to the levy authorized in clause
(1), a district may levy an amount equal to the amount the
district was entitled to levy pursuant to clause (2) in 1983 A
district having an approved adult basic and continuing education
program, according to section 124.26, may levy an amount not to
exceed the amount raised by .1 mill times the adjusted assessed
valuation of the district for the preceding year.
(4) In addition to the levy amounts authorized in this
subdivision, A district having an approved program and budget
may levy for a handicapped adult program. The levy amount may
not exceed the lesser of one-half of the amount of the approved
budget for the program for the fiscal year beginning in the
calendar year after the levy is certified or $25,000 for one
program. In the case of a program offered by a group of
districts, the levy amount shall be divided among the districts
according to the agreement submitted to the department. The
proceeds of the levy shall be used only for a handicapped adult
program or, if the program is subsequently not offered, for
community education programs. For programs not offered, the
department of education shall reduce the community education
levy by the amount levied the previous year for handicapped
adult programs.
(5) The levies authorized in this subdivision shall be used
for community education, including nonvocational adult programs,
recreation and leisure time activity programs, and programs
authorized by sections 121.85 to 121.88 and 129B.06 to 129B.09,
and 121.882. A school district may levy pursuant to this
subdivision only after it has filed a certificate of compliance
with the commissioner of education. The certificate of
compliance shall certify that the governing boards of the
county, municipality and township in which the school district
or any part thereof is located have been sent 15 working days
written notice of a meeting and that a meeting has been held to
discuss methods of increasing mutual cooperation between such
bodies and the school board. The failure of a governing board
of a county, municipality or township to attend the meeting
shall not affect the authority of the school district to levy
pursuant to this subdivision.
(6) The population of the district for purposes of this
subdivision is the population determined as provided in section
275.14 or as certified by the department of education from the
most recent federal census.
Sec. 20. Minnesota Statutes 1984, section 275.125, is
amended by adding a subdivision to read:
Subd. 9c. [1985 OPERATING DEBT LEVY.] (1) Each year, a
district may levy to eliminate a deficit in the net
unappropriated balance in the general fund of the district,
determined as of June 30, 1985, and certified and adjusted by
the commissioner. Each year this levy may be an amount not to
exceed the amount raised by a levy of 1.5 mills times the
adjusted assessed valuation of the district for the preceding
year. However, the total amount of this levy for all years it
is made shall not exceed the amount of the deficit in the net
unappropriated balance in the general fund of the district as of
June 30, 1985. When the cumulative levies made pursuant to this
subdivision equal the total amount permitted by this
subdivision, the levy shall be discontinued.
(2) A district, if eligible, may levy under this
subdivision or subdivision 9b but not both.
(3) The proceeds of this levy shall be used only for cash
flow requirements and shall not be used to supplement district
revenues or income for the purposes of increasing the district's
expenditures or budgets.
(4) Any district that levies pursuant to this subdivision
shall certify the maximum levy allowable under section 124A.03,
subdivision 1 or 3 in that same year.
Sec. 21. Minnesota Statutes 1985 Supplement, section
275.125, subdivision 11a, is amended to read:
Subd. 11a. [CAPITAL EXPENDITURE LEVY.] (a) Each year a
school district may levy an amount not to exceed the amount
equal to $90 per $130 times the total pupil unit, or $95 per
total pupil unit in districts where the number of actual pupil
units has increased from the prior year units in the year to
which the levy is attributable. No levy under this clause shall
exceed seven nine mills times the adjusted assessed valuation of
the taxable property in the district for the preceding year.
(b) The proceeds of the levy shall be placed in the
district's capital expenditure fund and may be used only:
(1) to acquire land, to equip and reequip buildings and
permanent attached fixtures, to rent or lease buildings for
school purposes,;
(2) to purchase textbooks, to purchase and lease computer
systems hardware, software, and related materials to support
software, and;
(3) to purchase or lease photocopy machines and
telecommunications equipment. The proceeds may also be used;
(4) for capital improvement and repair of school sites,
buildings and permanent attached fixtures, energy assessments,
and;
(5) for energy audits on district-owned buildings and for
funding those energy conservation and renewable energy measures
that the energy audits indicate will reduce the use of
nonrenewable sources of energy to the extent that the projected
energy cost savings will amortize the cost of the conservation
measures within a period of ten years or less;
(6) for the payment of any special assessments levied
against the property of the district authorized pursuant to
under section 435.19 or any other law or charter provision
authorizing assessments against publicly owned property;
provided that a district may not levy amounts to pay assessments
for service charges, such as those described in section 429.101,
whether levied pursuant to under that section or pursuant to any
other law or home rule provision. The proceeds may also be used;
(7) for capital expenditures to reduce or eliminate
barriers to or increase access to school facilities by
handicapped individuals. The proceeds may also be used;
(8) to make capital improvements to schoolhouses to be
leased pursuant according to section 123.36, subdivision 10.
The proceeds may also be used;
(9) to pay fees for capital expenditures assessed and
certified to each participating school district by the
educational cooperative service unit board of directors. The
proceeds may also be used;
(10) to pay principal and interest on loans from the state
authorized by sections 116J.37 and 298.292 to 298.298;
(11) for capital expenditures to bring district facilities
into compliance with the uniform fire code adopted according to
chapter 299F;
(12) for expenditures for the removal of asbestos from
school buildings or property, asbestos encapsulation, or
asbestos-related repairs;
(13) for expenditures for the cleanup and disposal of
polychlorinated biphenyls found in school buildings or property;
and
(14) for the cleanup, removal, disposal, and repairs
related to storing transportation fuels such as alcohol,
gasoline, fuel oil, and special fuel, as defined in section
296.01.
(c) Subject to the commissioner's approval, the proceeds
may also be used to acquire or construct buildings. The state
board shall promulgate rules establishing the criteria to be
used by the commissioner in approving and disapproving district
applications requesting the use of capital expenditure tax
proceeds for the acquisition or construction of buildings. The
approval criteria for purposes of building acquisition and
construction shall include: the appropriateness of the proposal
for the district's long-term needs; the availability of adequate
existing facilities; and the economic feasibility of bonding
because of the proposed building's size or cost.
(d) The board shall establish a fund in which the proceeds
of this tax shall be accumulated until
expended. Notwithstanding anything in paragraphs (b) and (c) to
the contrary, for any year for which the sum of a district's
levy under this subdivision and its aid for the same year under
section 124.245, subdivision 1, exceeds $125 times the total
pupil units in the same year, the amount by which the sum
exceeds $125 times the total pupil units may be expended only
for equipment for secondary vocational education programs or
senior secondary industrial arts programs.
(e) The proceeds of the levy shall not be used for
custodial or other maintenance services.
(f) Each year, subject to the mill limitation of clause
(a), a school district which operates an approved secondary
vocational education program or an approved senior secondary
industrial arts program may levy an additional amount equal to
$5 per total pupil unit for capital expenditures for equipment
for these programs.
Sec. 22. Minnesota Statutes 1985 Supplement, section
275.125, subdivision 11c, is amended to read:
Subd. 11c. [HAZARDOUS SUBSTANCE CAPITAL EXPENDITURE LEVY.]
In addition to the levy authorized in subdivisions 11a and 11b,
each year a school district may levy an amount not to exceed the
amount equal to $25 per times the total pupil unit units in the
year to which the levy is attributable. No levy under this
subdivision shall exceed two mills times the adjusted assessed
valuation of the property in the district for the preceding
year. The proceeds of the tax shall be placed in the district's
capital expenditure fund and may be used only for expenditures
necessary for the removal or encapsulation of asbestos from
school buildings or property, asbestos related repairs, cleanup
and disposal of polychlorinated biphenyls found in school
buildings or property, or the cleanup, removal, disposal, and
repairs related to storing transportation fuels such as alcohol,
gasoline, fuel oil, and special fuel, as defined in section
296.01.
Sec. 23. Minnesota Statutes 1985 Supplement, section
354.43, subdivision 3, is amended to read:
Subd. 3. Each school district, state university, community
college and any other employing authority of members of the fund
shall pay employer contributions at least once each month in
accordance with the provisions of sections 354.42, subdivisions
3 and 5, and 355.46, subdivision 3. Payments for school
district or area vocational technical institute employees who
are paid from normal operating funds, shall be made from the
district's or area vocational technical institute's general
appropriate fund of the district or area vocational technical
institute. With respect to state employees, each department and
agency shall pay the amounts required by section 354.42,
subdivisions 3 and 5 from the accounts and funds from which each
department or agency receives its revenue, including
appropriations from the general fund and from any other fund,
now or hereafter existing, for the payment of salaries and in
the same proportion as it pays therefrom the amounts of the
salaries. The payments shall be charged as an administrative
cost by these units of state government.
Sec. 24. Minnesota Statutes 1985 Supplement, section
354A.12, subdivision 2, is amended to read:
Subd. 2. [EMPLOYER CONTRIBUTIONS.] Notwithstanding any law
to the contrary, levies for teachers retirement fund
associations in cities of the first class, including levies for
any employer social security taxes for teachers covered by the
Duluth teachers retirement fund association or the Minneapolis
teachers retirement fund association or the St. Paul teachers
retirement fund association, are disallowed.
The employing units shall make the following employer
contributions to teachers retirement fund associations:
(a) For any coordinated member of a teachers retirement
fund association in a city of the first class, the employing
unit shall pay the employer social security taxes in accordance
with section 355.46, subdivision 3, clause (b);
(b) For any coordinated member of one of the following
teachers retirement fund associations in a city of the first
class, the employing unit shall make a contribution to the
respective retirement fund association in an amount equal to the
designated percentage of the salary of the coordinated member as
provided below:
Duluth teachers retirement
fund association 5.79 percent
Minneapolis teachers retirement
fund association 4.50 percent
St. Paul teachers retirement
fund association 4.50 percent
(c) For any basic member of one of the following teachers
retirement fund associations in a city of the first class, the
employing unit shall make a contribution to the respective
retirement fund in an amount equal to the designated percentage
of the salary of the basic member as provided below:
Minneapolis teachers retirement
fund association 13.35 percent
St. Paul teachers retirement
fund association 12.63 percent
The employer contributions shall be remitted directly to
each teachers retirement fund association each month.
Payments for school district or area vocational technical
institute employees who are paid from normal operating funds,
shall be made from the district's or area vocational technical
institute's general appropriate fund of the district or area
vocational technical institute.
Sec. 25. Minnesota Statutes 1985 Supplement, section
355.208, is amended to read:
355.208 [EMPLOYER CONTRIBUTIONS.]
Contributions required under the agreement or modification
entered into pursuant to section 355.207 to be made by political
subdivisions employing teachers, and payments required by
section 355.49, which shall apply to political subdivisions
employing teachers, shall be paid by the political
subdivisions. Payments for school district or area vocational
technical institute employees who are paid from normal operating
funds, shall be made from the district's or area vocational
technical institute's general appropriate fund of the district
or area vocational technical institute.
Sec. 26. Minnesota Statutes 1985 Supplement, section
355.287, is amended to read:
355.287 [EMPLOYER CONTRIBUTIONS.]
Contributions required under the agreement or modification
entered into pursuant to section 355.286 to be made by political
subdivisions employing teachers, and payments required by
section 355.49, which shall apply to political subdivisions
employing teachers, shall be paid by the political subdivision.
Payments for school district or area vocational technical
institute employees who are paid from normal operating funds,
shall be made from the district's or area vocational technical
institute's general appropriate fund of the district or area
vocational technical institute.
Sec. 27. Minnesota Statutes 1985 Supplement, section
355.46, subdivision 3, is amended to read:
Subd. 3. [SOCIAL SECURITY CONTRIBUTIONS.] The employer
taxes due with respect to employment by educational employees
who have made their selection pursuant to section 218(d) (6) (C)
of the Social Security Act, shall be paid in the following
manner:
(a) Contributions required to be made for current service
by political subdivisions employing educational employees and
payments required by section 355.49 shall be paid by the
political subdivision. Payments for school district or area
vocational technical institute employees who are paid from
normal operating funds, shall be made from the district's or
area vocational technical institute's general appropriate fund
of the district or area vocational technical institute. The
state shall make payments for services rendered prior to July 1,
1986.
(b) Contributions required to be made with respect to
educational employees of state departments and institutions and
payments required by section 355.49 shall be paid by the
departments and institutions in accordance with the provisions
of sections 355.49 and 355.50.
Sec. 28. Minnesota Statutes 1984, section 364.09, is
amended to read:
364.09 [LAW ENFORCEMENT; EXCEPTION.]
This chapter shall not apply to the practice of law
enforcement or, to eligibility for a family day care license or
a family foster care license, or to eligibility for school bus
driver endorsements. Nothing in this section shall be construed
to preclude the Minnesota police and peace officers training
board from recommending policies set forth in this chapter to
the attorney general for adoption in his discretion to apply to
law enforcement.
Sec. 29. Laws 1985, First Special Session chapter 12,
article 1, section 36, subdivision 3, is amended to read:
Subd. 3. [SUMMER PROGRAMS.] For summer program aid
pursuant to Minnesota Statutes, section 124A.033, subdivision 3,
and for summer instructional program aid pursuant to section
124A.033, subdivision 3a, there is appropriated:
$7,878,600.....1986,
$7,400,000 $3,145,100.....1987.
The appropriation for fiscal year 1986 is for aid for
programs in summer 1985. The appropriation for fiscal year 1987
is for aid for programs in summer 1986. Summer educational
improvement aid shall not be paid after fiscal year 1986.
Sec. 30. Laws 1985, First Special Session chapter 12,
article 2, section 15, subdivision 2, is amended to read:
Subd. 2. [TRANSPORTATION AID.] For transportation aid
there is appropriated:
$88,993,600.....1986,
$84,587,100 $82,638,000.....1987.
(a) The appropriation for 1986 includes $12,284,400 for aid
for fiscal year 1985 payable in fiscal year 1986 and $76,709,200
for fiscal year 1986 payable in fiscal year 1986.
(b) The appropriation for 1987 includes $13,536,900 for aid
for fiscal year 1986 payable in fiscal year 1987 and
$71,050,200 $69,101,100 for fiscal year 1987 payable in fiscal
year 1987.
(c) The appropriations are based on aid entitlements of
$90,246,100 for fiscal year 1986 and $83,588,400 $81,295,400 for
fiscal year 1987.
Sec. 31. Laws 1985, First Special Session chapter 12,
article 3, section 28, subdivision 9, is amended to read:
Subd. 9. [SECONDARY VOCATIONAL HANDICAPPED.] For aid for
secondary vocational education for handicapped pupils according
to section 124.574, there is appropriated:
$3,534,000.....1986,
$3,606,300.....1987.
The appropriation for 1986 includes $551,700 for aid for
fiscal year 1985 payable in fiscal year 1986, and $2,982,300 for
aid for fiscal year 1986 payable in fiscal year 1986. This
appropriation is based on the assumption that the state will
spend for this purpose an amount at least equal to $230,000 in
fiscal year 1986 of federal money received for vocational
education programs pursuant to the vocational education act of
1963, as amended.
The appropriation for 1987 includes $526,300 for aid for
fiscal year 1986 payable in fiscal year 1987, and $3,080,000 for
aid for 1987 payable in fiscal year 1987. This appropriation is
based on the assumption that the state will spend for this
purpose an amount at least equal to $230,000 in fiscal year 1987
of federal money received for vocational education programs
pursuant to the vocational education act of 1963, as amended.
The appropriations are based on aid entitlements of
$3,508,600 for fiscal year 1986 and $3,623,500 for fiscal year
1987.
Sec. 32. Laws 1985, First Special Session chapter 12,
article 3, section 28, subdivision 10, is amended to read:
Subd. 10. [OFFICE ON TRANSITION SERVICES.] For the
interagency office on transition services there is appropriated:
$75,000.....1986,
$85,000 $77,000.....1987.
Sec. 33. Laws 1985, First Special Session chapter 12,
article 4, section 11, subdivision 6, is amended to read:
Subd. 6. [DEPARTMENT ASSISTANCE FOR EARLY CHILDHOOD FAMILY
EDUCATION.] For the department to provide assistance to
districts in planning, implementing, and evaluating early
childhood family education programs there is appropriated:
$35,000.....1986,
$35,000 $31,500.....1987.
The department shall use the appropriation for personnel
service contracts and expenses of conferences and workshops.
Sec. 34. Laws 1985, First Special Session chapter 12,
article 5, section 10, subdivision 2, is amended to read:
Subd. 2. [COMPREHENSIVE ARTS PLANNING PROGRAMS.] For
comprehensive arts planning programs there is appropriated:
$100,000.....1986,
$100,000 $90,000.....1987.
The unencumbered balance remaining from fiscal year 1986
shall not cancel but shall be available for fiscal year 1987.
Sec. 35. Laws 1985, First Special Session chapter 12,
article 5, section 10, subdivision 4, is amended to read:
Subd. 4. [SCHOOL OF THE ARTS AND RESOURCE CENTER.] For the
purpose of making a grant to the Minnesota school of the arts
and resource center there is appropriated:
$ 491,000.....1986,
$2,170,000 $2,037,000.....1987.
The unencumbered balance remaining from fiscal year 1986
shall not cancel but shall be available for fiscal year 1987.
For fiscal years 1986 and 1987 a complement of 13 is
authorized for the school of the arts and resource center. Of
this complement, eight are in the categories of director,
coordinator, and department chairs.
Sec. 36. Laws 1985, First Special Session chapter 12,
article 6, section 28, subdivision 11, is amended to read:
Subd. 11. [GIFTED STUDY.] For the gifted education program
study there is appropriated:
$35,000 $33,300.....1986.
The appropriation is available until June 30, 1987. A
portion of the appropriation may be used for administrative
expenses.
Sec. 37. Laws 1985, First Special Session chapter 12,
article 6, section 28, subdivision 16, is amended to read:
Subd. 16. [SECONDARY VOCATIONAL EDUCATION AID.] For
secondary vocational education aid pursuant to Minnesota
Statutes, section 124.573, there is appropriated:
$21,117,400.....1986,
$21,511,300 $19,965,500.....1987.
The appropriation for 1986 includes $3,422,400 for aid for
fiscal year 1985 payable in fiscal year 1986. This amount also
includes $17,695,000 for aid for fiscal year 1986 payable in
fiscal year 1986.
The appropriation for 1987 includes $3,122,700 for aid for
fiscal year 1986 payable in fiscal year 1987. This amount also
includes $18,388,600 $16,842,800 for aid for fiscal year 1987
payable in fiscal year 1987.
The appropriations are based on aid entitlements of
$20,817,700 for fiscal year 1986 and $21,633,600 $19,815,100 for
fiscal year 1987.
For the purposes of this subdivision, money appropriated
for secondary vocational education programs may not be expended
for the purpose of discontinuing or converting existing senior
secondary school industrial arts education programs.
Sec. 38. Laws 1985, First Special Session chapter 12,
article 6, section 28, subdivision 17, is amended to read:
Subd. 17. [COUNCIL ON QUALITY EDUCATION; VENTURE FUND
GRANTS.] For the council on quality education venture fund
grants pursuant to Minnesota Statutes, sections 129B.01 129B.02
to 129B.05, there is appropriated:
$717,700.....1986,
$450,000 $350,000.....1987.
The appropriation for fiscal year 1986 includes $122,400
for grants for fiscal year 1985 payable in fiscal year 1986 and
$595,300 for grants for fiscal year 1986 payable in fiscal year
1986.
The appropriation for fiscal year 1987 includes $105,100
for grants for fiscal year 1986 payable in fiscal year 1987 and
$344,900 $244,900 for grants for fiscal year 1987 payable in
fiscal year 1987.
Any unexpended balance remaining from the appropriations in
this subdivision for 1986 shall not cancel and shall be
available for the second year of the biennium.
The appropriations are based on entitlements of $700,400
for fiscal year 1986 and $405,800 $288,200 for fiscal year 1987.
The council may maintain a complement of up to three
professionals and one clerical staff for fiscal year 1986 and
two professionals and one clerical staff for fiscal year 1987.
Sec. 39. Laws 1985, First Special Session chapter 12,
article 6, section 28, subdivision 20, is amended to read:
Subd. 20. [SECONDARY VOCATIONAL STUDENT ORGANIZATIONS.]
For aid for secondary vocational student organizations
there is appropriated:
$60,000.....1986,
$60,000 $54,000.....1987.
The appropriations for fiscal years 1986 and 1987 are
available for expenditure if the commissioner of education
authorizes an additional $160,000 $144,300 for each of fiscal
years 1986 and 1987 from the department's biennial
appropriations for this purpose.
Sec. 40. Laws 1985, First Special Session chapter 12,
article 8, section 60, subdivision 1, is amended to read:
Subdivision 1. [ESTABLISHMENT.] A task force on an
academic high school league is established. The task force
shall consist of 15 members appointed by the academic excellence
foundation. The foundation shall appoint at least one member
from the state committee of the north central association and
one member from the advisory committee for programs of
excellence. The task force shall terminate by June 30 December
31, 1986.
Sec. 41. Laws 1985, First Special Session chapter 12,
article 8, section 60, subdivision 4, is amended to read:
Subd. 4. [REPORT.] The task force shall report its
findings and recommendations to the academic excellence
foundation and the education committees of the legislature by
February 1 December 15, 1986.
Sec. 42. Laws 1985, First Special Session chapter 12,
article 8, section 62, subdivision 2, is amended to read:
Subd. 2. [EDUCATIONAL EFFECTIVENESS.] For educational
effectiveness programs according to sections 121.608 and 121.609
there is appropriated:
$1,034,000.....1986,
$781,000 $690,300.....1987.
The commissioner shall assign one additional position, from
the department's existing complement, to educational
effectiveness programs. The legislature intends that, beginning
in fiscal year 1987, districts will pay the costs of educational
effectiveness in-service for district staff.
Sec. 43. Laws 1985, First Special Session chapter 12,
article 8, section 62, subdivision 3, is amended to read:
Subd. 3. [ACADEMIC EXCELLENCE FOUNDATION.] For support of
the academic excellence foundation according to Minnesota
Statutes, section 121.612, there is appropriated:
$89,000.....1986,
$84,000 $75,400.....1987.
$5,000 of the fiscal year 1986 appropriation shall be used
for expenses related to the operation of the task force
established in section 60, subdivision 1.
Any unexpended balance from the appropriation for the
academic excellence foundation for fiscal year 1986 shall not
cancel but shall be available until June 30, 1987.
Sec. 44. Laws 1985, First Special Session chapter 12,
article 8, section 62, subdivision 4, is amended to read:
Subd. 4. [MANAGEMENT ASSISTANCE.] For management
assistance to school districts according to section 4 there is
appropriated:
$50,000.....1986,
$50,000 $45,000.....1987.
Sec. 45. Laws 1985, First Special Session chapter 12,
article 8, section 62, subdivision 6, is amended to read:
Subd. 6. [ASSESSMENT ITEM BANK.] For development and
implementation of the assessment item bank according to
Minnesota Statutes, section 123.742, subdivision 5, there is
appropriated:
$300,000.....1986,
$300,000 $270,000.....1987.
Sec. 46. Laws 1985, First Special Session chapter 12,
article 8, section 62, subdivision 8, is amended to read:
Subd. 8. [PER ASSISTANCE.] For state assistance for
planning, evaluation, and reporting, there is appropriated:
$120,000.....1986,
$120,000 $108,000.....1987.
$50,000 each year in fiscal year 1986 and $45,000 in fiscal
year 1987 shall be used for assisting districts with the
assurance of mastery program. Up to $50,000 each year shall be
used to develop and maintain model learner expectations. Up to
$20,000 each year shall be used for the state curriculum
advisory committee; a portion of this money may be for
administration.
Sec. 47. Laws 1985, First Special Session chapter 12,
article 8, section 62, subdivision 9, is amended to read:
Subd. 9. [TECHNOLOGY SERVICES.] For the purposes of
Minnesota Statutes, sections 129B.35, 129B.37, 129B.39, and
129B.40, there is appropriated:
$649,000.....1986,
$649,000 $935,100.....1987.
$351,000 shall be used to increase the fiscal year 1987
allocation for purchase of courseware package duplication rights
according to Minnesota Statutes, section 129B.39.
Sec. 48. Laws 1985, First Special Session chapter 12,
article 8, section 62, subdivision 12, is amended to read:
Subd. 12. [COURSEWARE PURCHASE SUBSIDY.] For subsidies for
purchases of courseware packages according to Minnesota
Statutes, section 129B.38 there is appropriated:
$351,000.....1986,
$351,000.....1987.
Sec. 49. Laws 1985, First Special Session chapter 12,
article 8, section 62, subdivision 13, is amended to read:
Subd. 13. [MASTERY LEARNING PROGRAM.] For the purposes of
section 42, subdivisions 3 and 10 and section 59, there is
appropriated:
$160,000.....1986,
$1,290,000 $1,217,500.....1987.
$125,000 of the appropriation for fiscal year 1986 shall be
used for a computerized mastery management system and support
materials. The remaining $35,000 in fiscal year 1986 shall be
used for planning aid to districts under section 42, subdivision
3.
$1,250,000 $1,187,500 of the appropriation in fiscal year
1987 shall be used for mastery learning project grants. The
remaining $40,000 $30,000 for fiscal year 1987 may be used by
the department to administer and evaluate the program.
Sec. 50. Laws 1985, First Special Session chapter 12,
article 8, section 62, subdivision 14, is amended to read:
Subd. 14. [SCHOOL MANAGEMENT ASSESSMENT CENTER.] For
support of the school management assessment center at the
University of Minnesota, there is appropriated:
$25,900.....1986,
$26,900 $24,300.....1987.
Sec. 51. Laws 1985, First Special Session chapter 12,
article 8, section 62, subdivision 15, is amended to read:
Subd. 15. [PROGRAMS OF EXCELLENCE.] For programs of
excellence according to Minnesota Statutes, sections 126.60 to
126.64, there is appropriated:
$25,000.....1986,
$25,000 $22,500.....1987.
Of this amount, the following sums may be used for the
purposes indicated in each year: $7,500 $6,750 for program
administration including expenses of the programs of excellence
committee, according to Minnesota Statutes, section 126.60,
subdivision 3 and $17,500 $15,750 for incentive grants according
to Minnesota Statutes, section 126.60, subdivision 4.
Sec. 52. Laws 1985, First Special Session chapter 12,
article 8, section 62, subdivision 17, is amended to read:
Subd. 17. [INDUSTRIAL TECHNOLOGY PROGRAM.] For development
of curriculum for the industrial technology program according to
section 56 there is appropriated:
$30,000 $28,500......1986.
The sum is available until June 30, 1987.
Sec. 53. Laws 1985, First Special Session chapter 12,
article 8, section 63, subdivision 2, is amended to read:
Subd. 2. [TEACHER EXAMINATIONS.] For duties related to
teacher examinations there is appropriated:
$105,000.....1986,
$ 75,000 $66,000.....1987.
$30,000 of the fiscal year 1986 appropriation is to
evaluate teaching skills of beginning teachers and $75,000 each
year in fiscal year 1986 and $66,000 in fiscal year 1987 is for
development of teacher examinations. Funds not expended in
fiscal year 1986 are available until June 30, 1987.
Sec. 54. Laws 1985, First Special Session chapter 12,
article 8, section 63, subdivision 3, is amended to read:
Subd. 3. [EXEMPLARY TEACHER EDUCATION PROGRAMS.] For
development of exemplary teacher education programs there is
appropriated:
$150,000.....1986,
$150,000 $135,000.....1987.
Up to $30,000 of this sum may be used for evaluation. The
sum is available until June 30, 1987.
Sec. 55. Laws 1985, First Special Session chapter 12,
article 8, section 64, subdivision 2, is amended to read:
Subd. 2. [SUMMER PROGRAM SCHOLARSHIPS.] For scholarship
awards for 1986 and 1987 summer programs according to section
22, there is appropriated:
$500,000 $475,000......1986.
Of this appropriation, the amount required may be used for
the higher education coordinating board's costs of administering
the program.
Sec. 56. Laws 1985, First Special Session chapter 12,
article 9, section 3, subdivision 2, is amended to read:
Subd. 2. [BASIC SUPPORT GRANTS.] For basic support grants
pursuant to sections 134.32 to 134.35 for the provision of
library service there is appropriated:
$4,923,600.....1986,
$5,047,300 $4,548,800.....1987.
The appropriation for 1986 includes $695,000 for aid for
fiscal year 1985 payable in fiscal year 1986, and $4,228,600 for
aid for fiscal year 1986 payable in fiscal year 1986.
The appropriation for 1987 includes $746,200 for aid for
fiscal year 1986 payable in fiscal year 1987 and
$4,301,100 $3,802,600 for aid for fiscal year 1987 payable in
fiscal year 1987.
The appropriations are based on aid entitlements of
$4,974,800 for fiscal year 1986 and $5,060,100 $4,473,700 for
fiscal year 1987.
Sec. 57. Laws 1985, First Special Session chapter 12,
article 9, section 3, subdivision 3, is amended to read:
Subd. 3. [MULTI-COUNTY, MULTI-TYPE LIBRARY SYSTEMS.] For
grants pursuant to sections 134.353 and 134.354 to multi-county,
multi-type library systems there is appropriated:
$205,100.....1986,
$213,000 $192,100.....1987.
The appropriation for 1986 includes $30,000 for aid for
fiscal year 1985 payable in fiscal year 1986, and $175,100 for
aid for fiscal year 1986 payable in fiscal year 1986.
The appropriation for 1987 includes $30,900 for fiscal year
1986 payable in fiscal year 1987, and $182,100 $161,200 for aid
for fiscal year 1987 payable in fiscal year 1987.
The appropriations are based on aid entitlements of
$206,000 for fiscal year 1986, and $214,200 $189,700 for fiscal
year 1987.
Sec. 58. Laws 1985, First Special Session chapter 12,
article 11, section 21, subdivision 3, is amended to read:
Subd. 3. [TO DEPARTMENT OF EDUCATION.] To the department
of education to make the aid payments required by section 2, as
amended by section 4 of this article, there is appropriated:
$195,462,000 $192,832,700.....1987.
This appropriation is for aid for fiscal year 1987 payable
in fiscal year 1987. The appropriation is based on an aid
entitlement of $229,955,300 $226,862,000 for fiscal year 1987.
Sec. 59. [AID FORMULA FOR 1986 SUMMER PROGRAMS.]
Notwithstanding Minnesota Statutes, section 124A.033,
subdivision 3, a district that offers a summer instructional
program in 1986, shall receive summer program aid equal to the
difference between:
(1) the product of
(a) the ratio of the district's actual levy as adjusted by
section 60 to its permitted levy as adjusted by section 60;
times
(b) the district's summer program revenue allowance; and
(2) the levy certified by the district and adjusted by
section 60 for 1986 summer programs.
Sec. 60. [LEVY FORMULA FOR 1986 SUMMER PROGRAMS.]
Notwithstanding Minnesota Statutes, section 124A.03,
subdivision 4, for any district that certified a levy in 1985
according to that subdivision, that levy shall be recomputed
according to the following provisions.
For 1986 summer programs, a district may levy an amount
equal to the following product:
(a) the district's estimated summer program revenue
allowance as defined in section 124A.033, subdivision 2, for the
summer program session in 1986, times
(b) the lesser of
(1) one, or
(2) the ratio of
(i) the quotient derived by dividing the adjusted assessed
valuation of the district in 1983 by the total pupil units in
the district in the 1985-1986 school year, to
(ii) 60 percent of the equalizing factor for the 1985-1986
school year.
(c) the levy limitation in 1986 shall be adjusted by the
difference between the levy certified in 1985 and the result of
the computation in this section.
Sec. 61. [DEBT SERVICE LEVY; INDEPENDENT SCHOOL DISTRICT
NO. 750, COLD SPRING.]
Notwithstanding Minnesota Statutes, section 475.61,
independent school district No. 750, Cold Spring, may increase
the levies it makes for debt service in 1986, for taxes payable
in 1987, and in 1987, for taxes payable in 1988, over the amount
the district is otherwise entitled to levy. The amount by which
the levies may be increased must not exceed the amount necessary
to provide for an equal levy for payment of the district's debt
service obligations for each of the next five years, beginning
with the levy made in 1986. The additional amount levied under
this section must not be considered to be an excess amount for
the purposes of section 475.61, subdivision 3. Any surplus
money remaining in the debt service fund when the obligations
and interest thereon are paid shall be used to reduce the
district's maintenance levy authorized pursuant to Minnesota
Statutes, section 124A.03, subdivision 1, in the next levy
certified. This section does not authorize the district to
incur additional indebtedness.
Sec. 62. [SPECIAL LEVY; MAHTOMEDI.]
In addition to other levies authorized by law, independent
school district No. 832, Mahtomedi, may levy in 1986 an amount
up to $250,000 for capital expenditures. The proceeds of the
levy may be used only to renovate Wildwood school.
By July 30, 1986, the school board shall hold a public
hearing on the need for the proposed levy. Upon receipt, within
30 days after the hearing, of a petition objecting to the levy
signed by a number of qualified voters in the district equal to
the greater of 50 voters or 15 percent of the number of voters
who voted in the most recent school board election, the board
shall hold a referendum on the proposed levy. The referendum
shall be held on the date set by the board but no later than
October 1, 1986. If a valid petition is not received by the
school board, within 30 days after the hearing, no referendum
need be held.
Sec. 63. [EXCESS CAPITAL OUTLAY LEVY; MOOSE LAKE.]
Subdivision 1. [1986.] Independent school district No. 97,
Moose Lake, may levy up to $75,000 in 1986 for capital outlay
purposes in addition to all other levies for capital outlay and
other purposes.
Subd. 2. [1987.] Independent school district No. 97, Moose
Lake, may levy up to $70,000 in 1987 for capital outlay purposes
in addition to all other levies for capital outlay and other
purposes.
Subd. 3. [REFERENDUM.] The authorization for the levy in
subdivision 1 or 2 may be revoked or reduced as provided in this
subdivision. A referendum on the question of revoking or
reducing the authorized amount shall be called on the written
petition of a number of qualified voters in excess of 15 percent
of the average number of voters of the two most recent
district-wide school elections. A petition to revoke or reduce
the levy authorized by subdivision 1 must be received by
September 1, 1986, and the referendum must be held by October
10, 1986. A petition to revoke or reduce the levy authorized by
subdivision 2 must be received by September 1, 1987, and the
referendum must be held by October 10, 1987. The ballot must
state the number of mills required to raise the authorized
amount. The ballot question must read substantially as follows:
"Shall the authority to make an extra capital levy in
(year) granted to independent school district No. 97 in (this
act) be (revoked/reduced from $..... to $.....)?"
In other respects, the referendum shall be conducted as
other elections are conducted under sections 124A.03 and 123.32.
Sec. 64. [REPEALER.]
Subdivision 1. [JULY 1, 1986.] Minnesota Statutes 1984,
section 275.125, subdivision 16, and Minnesota Statutes 1985
Supplement, sections 124.245, subdivision 5, 129B.38, and
275.125, subdivision 11b, are repealed.
Subd. 2. [JUNE 30, 1987.] Minnesota Statutes 1985
Supplement, section 124.245, subdivision 2, is repealed.
Sec. 65. [EFFECTIVE DATES.]
Subdivision 1. [IMMEDIATE.] Sections 3, 8, 10, 13, 14, 16,
18, 22, 23, 24, 25, 26, 27, 28, 31, 36, 40, 43, 52, 53, 55, 59,
and 60 are effective the day following final enactment.
Subd. 2. [JUNE 30, 1987.] Sections 9 and 64, subdivision
2, are effective June 30, 1987.
ARTICLE 10
POST-SECONDARY EDUCATION BOARDS; DEPARTMENT OF EDUCATION
Section 1. [APPROPRIATIONS.]
Subdivision 1. The amounts shown in the columns marked
"APPROPRIATIONS" are added to (or, if shown in parentheses, are
subtracted from) the appropriations in Laws 1985, First Special
Session chapter 11, to the specified agencies. The figures
"1986" or "1987," in this article, mean that the amounts listed
under them are added to (or subtracted from) the appropriations
for the fiscal year ending June 30, 1986, or June 30, 1987,
respectively.
SUMMARY
1986 1987 TOTAL
General Fund $(31,101,200) $(4,848,800) $(35,950,000)
APPROPRIATIONS
1986 1987
Subd. 2. Department of
Education $(702,300) $(1,756,300)
(a) The approved complement of the
department of education is reduced by
33 positions by June 30, 1987.
(b) Notwithstanding any law to the
contrary, the duties and
responsibilities of the council on
quality education are suspended but
shall instead be performed by the
commissioner of education until June
30, 1987. The council on quality
education shall immediately give all
books, records, and other documents to
the commissioner of education.
(c) Notwithstanding Minnesota Statutes,
section 121.934, the commissioner of
education is not required to pay
compensation or expenses of the ESV
computer council members for fiscal
year 1987.
(d) Beginning July 1, 1986, basic
skills services to school districts may
be provided by contracts between the
educational service units and each
school district, if a school district
desires the services.
(e) When preparing the 1987-1989
biennial budget request, the department
of education and the department of
finance shall include funding requests
for regional management information
centers in the education aids budget
rather than the department of education
budget.
Subd. 3. Higher Education
Coordinating Board (10,000) (3,042,000)
(a) Notwithstanding Laws 1985, First
Special Session chapter 11, sections 38
and 82, the higher education
coordinating board shall delay
implementation of the four-year
eligibility component of the state
grant and scholarship program until
July 1, 1987.
(b) The higher education coordinating
board may transfer appropriations in
Laws 1985, First Special Session
chapter 11, section 3, among the
subdivisions in that section. The
transfers must be made in accordance
with Minnesota Statutes, section 3.30.
(c) The higher education coordinating
board shall study the need for a loan
forgiveness program for career teachers
under improved learning programs as
defined in Minnesota Statutes, section
129B.46. The board shall consult with
the chairs of the education committees
of the legislature prior to conducting
the study. The board shall report by
January 1, 1987, to the education
committees of the legislature.
(d) The higher education coordinating
board may spend up to $500,000 of the
projected unobligated balance in
1986-1987 agency appropriations for
supplemental scholarships and grants or
additional state work study for
students in economically depressed
areas of the state. The expenditure
for these programs during the biennium
is not subject to the rulemaking
provisions of chapter 14. Of the
remaining projected unobligated
balance, the board may supplement the
1987 state scholarship and grant awards
up to an amount equal to reductions in
federal Pell grants. Any action taken
under this provision must first be
submitted to the chairs of the
education divisions of the
appropriations and finance committees
of the legislature for review.
Subd. 4. State Board of
Vocational Technical Education (6,004,400) -0-
(a) Intermediate school district No.
287, suburban Hennepin, may construct a
maintenance facility at the north
campus of the AVTI. The total cost of
the facility must not exceed the amount
approved by the state board of
vocational technical education under
Minnesota Statutes, section 136C.07,
subdivision 5. The entire project cost
must be paid with local money.
(b) If the appropriation in Laws 1985,
First Special Session chapter 11,
section 4, for fiscal year 1986 is
insufficient to pay teacher retirement
and FICA costs, the state director of
vocational technical education may
transfer the necessary amounts from
fiscal year 1987 to pay those costs.
(c) The state board of vocational
technical education may transfer any
unencumbered balances among the
appropriations in Laws 1981, chapter
362, section 2; Laws 1984, chapter 597,
section 13; and Laws 1985, First
Special Session chapter 15, section
13. The transfers must be made
according to Laws 1985, First Special
Session chapter 15, section 24.
Subd. 5. State Board for
Community Colleges (2,887,300) -0-
(a) Notwithstanding Minnesota Statutes,
chapter 94, the commissioner of
administration, upon request of the
state board for community colleges, may
enter into an agreement with the county
of St. Louis to exchange parcels of
land. The conveyances must be made for
no monetary consideration and by
quitclaim deed in a form approved by
the attorney general.
(b) The state board for community
colleges in cooperation with the higher
education facilities authority shall
study the feasibility of constructing
and operating student housing for
Vermilion Community College. The study
may include: methods of financing,
such as higher education facilities
authority revenue bonds guaranteed by
the iron range resources and
rehabilitation board, private sources,
earnings from the student housing, and
other methods; projected use of the
facilities; and other pertinent
information. The study, following
approval of the state board for
community colleges, must be submitted
to the governor, the chairs of the
senate finance and house appropriations
committees, and the higher education
coordinating board by January 1, 1987.
Subd. 6. State University
Board (5,758,400) -0-
The state university board may include
the remodeling of Phelps Hall in the
appropriation in Laws 1985, First
Special Session chapter 15, section 15,
subdivision 6(a).
Subd. 7. Board of Regents of
the University of Minnesota (15,788,800) -0-
(a) Operations and
maintenance $(13,368,000) $ -0-
(b) Special
appropriations $ (2,420,800) $ -0-
Subd. 8. Mayo Medical
Foundation -0- (50,500)
Subd. 9. Governor 50,000 -0-
The governor, after consulting with the
Fond du Lac reservation and the higher
education coordinating board, shall
appoint a task force of 13 members to
study the feasibility of establishing a
coordinate campus of Arrowhead
Community College on the Fond du Lac
Indian reservation that would be open
and available to all. The task force
shall report to the legislature on the
results of its study by February 1,
1987. The task force shall provide
copies of its report to the state board
for community colleges and the higher
education coordinating board. Those
boards shall respond to the legislature
on the report of the task force by
March 1, 1987. The task force (1) is
subject to Minnesota Statutes, section
15.059, subdivision 6, (2) may accept
money from nonstate sources to do its
work, (3) shall cooperate with and
invite the participation before it of
the federal government, including the
Bureau of Indian Affairs, and (4) shall
report on, among other things, the
availability of federal tribal
community college funding.
Subd. 10. Education Systems
(a) The changes in subdivisions 2 to 9
may be transferred between fiscal years
1986 and 1987, upon the advance
approval of the commissioner of finance.
(b) The changes in appropriations in
this act must not be taken into account
when calculating the 1987-1989 biennial
budgets for post-secondary systems.
Except for changes attributable to
enrollment or internal reallocation of
appropriated money, the fiscal year
1987 instructional base used by each
system in its respective 1987-1989
biennial budget request must not differ
from the spending level established by
Laws 1985, First Special Session
chapter 11.
(c) The reductions in subdivisions 4 to
7 must not be implemented until each
system has submitted its plan to the
chairs of the senate finance and house
appropriations committees.
(d) Notwithstanding any law to the
contrary, if recommended by the average
cost funding task force, the board of
regents of the University of Minnesota,
state university board, state board for
community colleges, and state board of
vocational technical education shall
submit 1987-1989 biennial budget
requests which: (1) take into account
fixed and variable instructional costs;
(2) base calculation of instructional
appropriations on enrollments other
than those achieved two years earlier;
and (3) include any other
recommendations of the average cost
funding task force.
Sec. 2. Minnesota Statutes 1984, section 15.38,
subdivision 3, is amended to read:
Subd. 3. [STATE UNIVERSITIES.] The state university board
may purchase insurance coverage as it deems necessary and
appropriate to protect buildings and contents and for activities
ancillary to the programs of the state universities.
Sec. 3. Minnesota Statutes 1985 Supplement, section
15A.081, subdivision 8, is amended to read:
Subd. 8. [EXPENSE ALLOWANCE.] Notwithstanding any law to
the contrary, positions listed in subdivision 1, constitutional
officers, the president of each community college, and the
commissioner of iron range resources and rehabilitation, and the
director of vocational technical education are authorized an
annual expense allowance not to exceed $1,500 for necessary
expenses in the normal performance of their duties for which no
other reimbursement is provided. However, expense allowances
for the chancellor of the state university system and the
president of each state university shall be governed only by
section 136.063. The expenditures under this subdivision are
subject to any laws and rules relating to budgeting, allotment
and encumbrance, preaudit and postaudit. The commissioner of
finance may promulgate rules to assure the proper expenditure of
these funds, and to provide for reimbursement.
Sec. 4. Minnesota Statutes 1984, section 121.901,
subdivision 2, is amended to read:
Subd. 2. The council shall expire, and the terms,
compensation and removal of members shall be as provided in
section 15.059. The state board shall determine the length of
terms of the initial members consistent with section 15.059.
Sec. 5. Minnesota Statutes 1984, section 124.71,
subdivision 2, is amended to read:
Subd. 2. Commissioner as used in sections 124.71 to 124.76
means the commissioner of education of the state of Minnesota
or, for certificates for an area vocational technical institute,
the state director of vocational technical education.
Sec. 6. [135A.09] [EXPENSE ALLOWANCES.]
The state board of vocational technical education and the
higher education coordinating board may each establish an annual
expense allowance for the state director of vocational technical
education and the executive director of the higher education
coordinating board, respectively. The state university board
and the state board for community colleges may each establish an
expense allowance for the chancellors and campus presidents.
The allowances are not subject to chapter 16A, but each board
shall report the allowances and expenditures annually to the
chairs of the house appropriations and senate finance
committees, and to the commissioner of finance.
Sec. 7. Minnesota Statutes 1984, section 136.14, is
amended to read:
136.14 [DUTIES OF BOARD.]
Subdivision 1. [GENERAL.] The state university board shall
have the educational management, supervision, and control of the
state universities and of all related property appertaining
thereto. It shall appoint all presidents, teachers, and other
necessary employees therein and fix their salaries. It shall
prescribe courses of study, conditions of admission, prepare and
confer diplomas, report graduates of the state university
department, and adopt suitable rules policies for the
universities. Sections 14.01 to 14.47 do not apply to policies
and procedures of the board. It shall, as a whole or by
committee, visit each state university at least once in each
year for the purpose of meeting with administrators, faculty,
students and the community to discuss such matters as
facilities, modes of instruction, curriculum, extracurricular
programs and management.
Subd. 2. [OFFICE LOCATION.] Notwithstanding chapter 16B,
the state university board may select the location for its
central office.
Sec. 8. Minnesota Statutes 1985 Supplement, section
136C.07, subdivision 5a, is amended to read:
Subd. 5a. [REVIEW OF CAPITAL IMPROVEMENTS.] A school
board, as defined in section 136C.02, subdivision 8, must not
award final contracts for capital improvements until the state
director has reviewed and approved the final plans,
specifications, and cost estimates and made recommendations on
them.
Sec. 9. Minnesota Statutes 1984, section 136C.35, is
amended to read:
136C.35 [LENGTH OF SCHOOL YEAR AND DAY.]
For an AVTI, the normal school year shall be at least 175
session days. In all AVTI's, the length of the school day for
each pupil, exclusive of the noon intermission, shall be at
least six hours. Exceptions may be made by the district for
approved AVTI programs provided on a part-time or extended day
basis to meet the needs of individual students or classes.
These exceptions are authorized only for programs originally
provided on a full-time basis. Notwithstanding section 126.12,
an AVTI may conduct regularly scheduled classes on Saturdays.
Sec. 10. [299F.091] [CITATION.]
Sections 10 to 18 may be cited as the "community emergency
response hazardous substances protection act."
Sec. 11. [299F.092] [DEFINITIONS.]
Subdivision 1. [SCOPE.] The terms used in sections 10 to
18 have the meanings given them in this section.
Subd. 2. [CLASSIFIED INFORMATION.] "Classified
information" means information, data, or both that, for security
reasons, has been given a special security classification such
as "secret," "confidential," "private," or "nonpublic," by
federal statute or rule and that, when so classified, is subject
to handling, use, and storage in accordance with established
standards to prevent unauthorized use or disclosure.
Subd. 3. [COMMISSIONER.] "Commissioner" means the
commissioner of public safety.
Subd. 4. [EMERGENCY RESPONSE PERSONNEL.] "Emergency
response personnel" means personnel employed or authorized by
the federal government, the state, or a political subdivision to
provide fire suppression, police protection, emergency medical
services, or emergency activities relating to health and safety.
Subd. 5. [EMPLOYER.] "Employer" means an employer as
defined in section 182.651, subdivision 7. For the purposes of
sections 10 to 18, "employer" also means a partnership or a
self-employed person, whether or not the partnership or person
has other employees. "Employer" does not mean a farm that is a
"small business."
Subd. 6. [FIRE DEPARTMENT.] "Fire department" means a
regularly organized fire department, fire protection district,
or fire company as defined in the uniform fire code adopted
under section 299F.011, regularly charged with the
responsibility of providing fire protection to the state or a
political subdivision.
Subd. 7. [HAZARD CATEGORY.] "Hazard category" means a list
or description of hazardous substances, as developed by rule by
the commissioner of public safety, including human reproductive
hazards, flammable substances, human carcinogens, explosives,
corrosives, and reactive agents, that present similar hazards in
an emergency, or individual hazardous substances of special
concern to emergency response personnel.
Subd. 8. [HAZARDOUS SUBSTANCE.] "Hazardous substance"
means a substance or mixture as defined in section 182.651,
subdivisions 14, 17, and 18, except that sections 10 to 18 do
not apply to any hazardous substance while it is being
transported in interstate or intrastate commerce.
Subd. 9. [HAZARDOUS SUBSTANCE NOTIFICATION ADVISORY
COMMITTEE.] "Hazardous substance notification advisory
committee" is the committee established under section 16.
Subd. 10. [HAZARDOUS SUBSTANCE NOTIFICATION
REPORT.] "Hazardous substance notification report" means a
written record submitted to a fire department, for each
workplace, that contains the information required in section 13.
Subd. 11. [LOCAL FIRE DEPARTMENT.] "Local fire department"
means the fire department that would normally respond to a fire
at a given workplace.
Subd. 12. [MATERIAL SAFETY DATA SHEET.] "Material safety
data sheet" means a completed form recognized by the
occupational safety and health administration, equivalent
manufacturer's literature, or another form containing
substantially the same information pertaining to a specific
hazardous substance or a mixture containing one or more
hazardous substances.
Subd. 13. [NONPUBLIC DATA.] "Nonpublic data" has the
meaning given it in section 13.02, subdivision 9.
Subd. 14. [SIGNIFICANT CHANGE.] "Significant change" means
a change in the reportable quantity of a hazardous substance
that places the substance in a different quantity range as
specified on the hazardous substance notification report form.
Subd. 15. [SMALL BUSINESS.] "Small business" means a
business entity organized for profit, including any individual,
partnership, corporation, joint venture, association, or
cooperative that has 20 or fewer full-time employees, or
equivalent full-time employees during the preceding fiscal year
or not more than $1,000,000 in annual gross revenue in the
preceding fiscal year, and that is not an affiliate or
subsidiary of a business having more than 20 full-time or
equivalent full-time employees and more than $1,000,000 in
annual gross revenues. For the purposes of this subdivision,
"equivalent full-time employees" means part-time employees' work
time combined to total 2,000 hours or the equivalent of one
full-time employee.
Subd. 16. [WORK AREA.] "Work area" means a defined space
in a workplace where hazardous chemicals are stored, produced,
or used and where employees are present.
Subd. 17. [WORKPLACE.] "Workplace" means an establishment
at one geographical location containing one or more work areas.
Sec. 12. [299F.093] [POWERS AND DUTIES OF COMMISSIONER.]
Subdivision 1. [DUTIES.] (a) The commissioner shall:
(1) adopt rules no later than July 1, 1987, with the advice
of the hazardous substance notification advisory committee,
establishing the form and content of the hazardous substance
notification report form, as required by section 13, and
describing one or more hazard categories with specified ranges
of quantities in each hazard category, representing increments
of substantially increased risk;
(2) print and provide to individual fire departments the
requested number of hazardous substance notification reports,
which must be made available to a fire department no more than
90 days following its request, for the fire department to mail
or otherwise make available to employers in the jurisdiction;
(3) report to the legislature, as needed, on the
effectiveness of sections 10 to 18 and recommend amendments to
sections 10 to 18 that are considered necessary;
(4) appoint a hazardous substance notification advisory
committee as required in section 16;
(5) adopt rules to implement sections 10 to 18, compatible
with the Minnesota Uniform Fire Code so as to not limit the
authority of local fire officials under that code; and
(6) in consultation with the hazardous substance
notification advisory committee, adopt rules that are based on
the most recent standard 704, adopted by the National Fire
Protection Association, and that allow a fire department to
require employers within its jurisdiction to post signs
conforming to standard 704, and indicating the presence of
hazardous substances. If the signs are required, a fire
department shall supply the signs or provide information to
assist an employer to obtain them.
(b) The commissioner shall adopt criteria and guidelines,
with the concurrence of the hazardous substance notification
advisory committee, for the disbursement of funds pursuant to
section 20, subdivision 1. These criteria and guidelines are
exempt from the Minnesota administrative procedure act.
Subd. 2. [INVESTIGATION POWERS.] The commissioner shall,
at the request of a local fire department, investigate suspected
violations of sections 10 to 18.
Sec. 13. [299F.094] [REPORT REQUIRED; CONTENTS.]
Subdivision 1. [EMPLOYER'S DUTY.] Except as provided in
section 15, subdivision 2, an employer who receives a hazardous
substance notification report shall submit to the local fire
department a completed hazardous substance notification report
form containing the information and in the manner required by
this section and the rules of the commissioner, within two
months after receiving a hazardous substance notification
report. As an alternative, an employer may, at the discretion
of the local fire department, arrange with the local fire
department for a date certain upon which that department may
conduct an inspection of that employer's workplace in order for
the employer to provide the information, or essentially the same
information, as contained in the report form to the local fire
department.
Subd. 2. [CONTENTS OF FORM.] The hazardous substance
notification report must be completed on a form developed by the
commissioner of public safety and contain the following
information: (1) the range of maximum combined quantities of
all hazardous substances contained in each designated hazard
category that may reasonably be expected to be present in the
workplace during normal operations; (2) the street address and
any other special identifier of the workplace; and (3) the
employer's name and street address with the telephone numbers of
responsible persons in charge of the workplace who can be
reached at all times.
Subd. 3. [UPDATED INFORMATION.] If, after review of the
hazardous substance notification report of an employer, a local
fire department requires additional information, then the
employer:
(1) shall provide, at the request of that fire department,
a material safety data sheet, or any requested portion of it,
for any hazardous substance contained in any designated hazard
category covered by the hazardous substance notification report;
and
(2) shall respond as soon as possible, but in no case later
than 30 days, to a request by a local fire department for
clarification of any information previously submitted or to a
request for additional information under sections 10 to 18.
Subd. 4. [PROMPT NOTIFICATION OF CHANGES.] An employer
shall promptly notify the local fire department of significant
changes in the information provided under this section, but not
later than 30 days after each significant change.
Subd. 5. [INSPECTIONS; EMERGENCY PLANS.] At the request of
the local fire department, an employer shall permit the local
fire department inspection and cooperate in the preparation of
fire and emergency plans.
Sec. 14. [299F.095] [POWERS AND DUTIES OF FIRE
DEPARTMENTS.]
To the extent feasible, given the amount of funds and
training available, the local fire department shall:
(1) mail or otherwise distribute hazardous substance
notification report forms to employers within the jurisdiction
of the fire department except for those employers for whom an
inspection has been arranged or employers from whom a hazardous
substance notification is considered not necessary by the fire
department;
(2) retain and evaluate each hazardous substance
notification report and notification of significant change
submitted by each employer until the employer's workplace ceases
to exist or the fire department determines retention of the
hazardous substance notification report is no longer necessary;
(3) develop for fire department use appropriate fire and
emergency procedures for the hazardous substance risks of each
workplace based on the information received;
(4) investigate suspected violations of sections 10 to 18,
and issue appropriate orders for compliance; and
(5) provide available material safety data sheets and
hazardous substance notification reports at the request of other
emergency response personnel.
Data collected under sections 10 to 18 is nonpublic data
within the meaning of section 13.02, subdivision 9.
Sec. 15. [299F.096] [DUTY TO SAFEGUARD PRIVATE
INFORMATION.]
Subdivision 1. [NONPUBLIC DATA.] Before a fire department
and emergency response personnel may have access to information
received under section 13, the department shall establish
security procedures to prevent unauthorized use or disclosure of
nonpublic data. Nonpublic data must be made available in an
emergency to emergency response personnel. No liability results
under sections 10 to 18 with respect to disclosure of nonpublic
data if emergency response personnel, in response to an
emergency, reasonably determine that the use or disclosure of
the data is necessary to expedite medical services or to protect
persons from imminent danger. As soon as practicable after
disclosure of nonpublic data is made by emergency response
personnel, the circumstances necessitating the disclosure and
the actual or estimated extent of the disclosure must be
described in writing by the personnel and provided to the
employer.
Subd. 2. [CLASSIFIED INFORMATION.] When the notification
required in section 13 involves classified information, the
employer shall, without revealing the classified information,
attempt to provide the local fire department with that
information necessary to protect the department, emergency
response personnel, and the public in an emergency. The
employer is also responsible for requesting changes in the
classification of classified information or declassification of
that material when it is considered necessary by a local fire
department in advance of an emergency to protect emergency
response personnel or the public. An employer is not required
to reveal classified information, except in an emergency,
without prior governmental approval, and in an emergency, an
employer shall disclose to emergency response personnel
appropriate elements of classified information that are
reasonably necessary to protect human life. An employer may
choose to make classified information available to the local
fire department or emergency response personnel if necessary for
emergency preplanning purposes. In those cases, classified
information (1) may be made available to a local fire department
or emergency response personnel only after it has been
demonstrated that the personnel intended to have access to the
classified information meet access requirements applicable to
the facilities and to personnel having access to classified
information, and (2) must be protected from disclosure by the
local fire department and emergency response personnel in
accordance with applicable rules and statutes.
Sec. 16. [299F.097] [HAZARDOUS SUBSTANCE NOTIFICATION
ADVISORY COMMITTEE.]
The hazardous substance notification advisory committee is
created. The committee shall consist of 11 members to be
appointed by the commissioner of public safety to advise on the
development of rules to implement and enforce sections 10 to 18
and to assist in the development of amendments to the hazardous
substance notification report. The advisory committee shall
consist of representation from fire chiefs; professional
firefighters; volunteer firefighters; fire marshals; law
enforcement personnel; emergency medical personnel; an
independent health professional with training in toxicology; and
four representatives from business and industry, at least one of
whom shall represent small business. The committee must be
appointed, serve, and be compensated in the manner provided in
section 15.059, and shall serve at the pleasure of the
commissioner.
Sec. 17. [299F.098] [PENALTIES.]
(a) An employer who violates a provision of sections 10 to
18 or a rule or order adopted or made under the authority of
those sections, that is determined by rule not to be a violation
of a serious nature, may be assessed a fine not to exceed $1,000.
(b) An employer who violates a provision of sections 10 to
18 or a rule or order adopted or made under the authority of
those sections, that is determined by rule to be of a serious
nature, must be assessed a fine not to exceed $1,000 for each
violation.
(c) An employer who is convicted of knowingly making a
false statement, representation, or certification in an
application, record, report, plan, or other document filed or
required to be maintained under sections 10 to 18 is guilty of a
gross misdemeanor.
(d) An employer who is convicted of willfully or repeatedly
violating the requirements of sections 10 to 18 or a rule or
order adopted or made under those sections is guilty of a gross
misdemeanor.
(e) The penalties provided by this section may be imposed
in a criminal action in the name of the state brought in the
district court of the county in which the violation is alleged
to have occurred or the district court where the commissioner
has an office. Fines imposed under sections 10 to 18 must be
paid to the commissioner of public safety and deposited in the
general fund.
(f) No employer may be convicted for violating sections 10
to 18 or a rule or order made or issued under those sections
unless the employer was notified of the violation in writing and
given a reasonable time to comply.
Sec. 18. [299F.099] [LOCAL ORDINANCES.]
Sections 10 to 18 preempt and supersede any local ordinance
or rule concerning the subject matter of those sections.
Sec. 19. [136C.70] [HAZARDOUS SUBSTANCES TRAINING COURSES.]
The state board of vocational technical education shall
provide courses in hazardous substances. The commissioner of
public safety, with the concurrence of the director of the state
board of vocational education and with the advice of the
hazardous substance notification advisory committee, shall
certify the courses eligible for reimbursement. Among the
courses eligible for reimbursement are in-service training and
refresher courses. The state board shall develop policies for
tuition subsidies in hazardous substance courses. The subsidies
shall only be applied to fire service personnel commencing and
successfully completing training regarding the hazardous
substances requirements.
Sec. 20. [ALLOCATION.]
Subdivision 1. $15,000 shall be transferred from the state
board of vocational technical education for the fiscal year
ending June 30, 1987, to the commissioner of public safety to
otherwise administer the provisions of sections 10 to 18.
Subd. 2. Any unencumbered balances remaining in the first
fiscal year of any of these appropriations do not cancel but are
available for the second year.
Subd. 3. In this section, the definitions in section 11
apply.
Sec. 21. [STATE UNIVERSITY CONSTRUCTION.]
Notwithstanding Minnesota Statutes, chapter 16B, for the
1986-1987 fiscal years, the Mankato State University Foundation
Incorporated may construct a building not to exceed 4,200 square
feet at a site on the Mankato State University campus that has
been approved by the state board. The building shall be donated
or leased to Mankato State University, subject to the approval
of the state board. The board shall have approval authority for
the design and lease. Title to the building shall pass to the
state immediately upon donation or when all the terms of the
lease have been met. Prior to any design, construction, or
lease the state university board shall report its plans to the
chairs of the senate finance and house appropriations committees.
Sec. 22. [AUDIT COMMISSION STUDY.]
The legislative audit commission is requested, according to
Minnesota Statutes, section 3.97, subdivision 7, to evaluate the
activities and programs of the department of education. The
study should include recommendations regarding the elimination,
reduction, or expansion of the department activities and
programs and their required complements. The study should also
examine department work assignments and make recommendations to
improve the match of job requirements and employee skills
pursuant to labor contracts and state law. The legislative
audit commission is advised to consult with the commissioner of
employee relations. The commission should report its results by
January 15, 1987 to the chairs of the appropriations and finance
committees of the legislature.
Sec. 23. [REPEALER.]
Minnesota Statutes 1984, sections 121.495 and 136.063 are
repealed.
Sec. 24. [EFFECTIVE DATE.]
This article is effective the day following final enactment.
ARTICLE 11
DEPARTMENT OF NATURAL RESOURCES
Section 1. [DEPARTMENT OF NATURAL RESOURCES
REORGANIZATION.]
Subdivision 1. [PURPOSES.] It is the intent of the
legislature to further decentralize the department of natural
resources.
Subd. 2. [IMPLEMENTATION.] One-half but not less than 20
full-time legislatively approved complement positions vacant as
of March 1, 1986, in the St. Paul central office shall be
transferred to the field by May 1, 1986.
Subd. 3. [APPROPRIATIONS; STUDY.] Up to $200,000 is
appropriated from the Minnesota resources fund to the
legislative commission on Minnesota resources to contract with
at least one consultant to conduct a study of the management and
organization of the department of natural resources. This
appropriation is available until June 30, 1987. The study must
include an evaluation of, and contain recommendations for change
where appropriate in, the following subjects relating to the
department:
(1) establishing a ratio of regional staff to central
office staff greater than the ratio established in the 1986-1987
biennial budget (a) for employees included in the department's
legislatively approved complement; and (b) for employees not
included in the department's complement;
(2) the responsiveness of the department to public and
resource needs;
(3) the distribution of decision-making authority for
planning, policymaking, budgeting, including any saving or
potential increased cost, and program implementation within the
department;
(4) the personnel structure and career opportunities within
the department;
(5) assistance to local units of government in the
development, management, and funding of resource management
programs;
(6) possible savings in expenditures for legal services and
unemployment compensation that could be achieved through changes
in management and organization of the department;
(7) coordination and cooperation within the department; and
(8) the relationship of new programs to present personnel
structure and management objectives.
The legislative commission on Minnesota resources must
submit a report on the study to the legislature by January 15,
1987.
Sec. 2. [EFFECTIVE DATE.]
Section 1 is effective the day after final enactment.
Approved April 9, 1986
Official Publication of the State of Minnesota
Revisor of Statutes