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Minnesota Session Laws - 1990, Regular Session

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

  

                         Laws of Minnesota 1990 

                        CHAPTER 604-H.F.No. 2478 
           An act relating to the financing and operation of 
          government in Minnesota; providing a taxpayer bill of 
          rights; updating references to the Internal Revenue 
          Code; imposing an annual fee on corporations and 
          partnerships; changing the computation of state aids 
          to local units of governments; modifying the 
          computation and administration of taxes and property 
          tax refunds; changing tax rates and providing 
          exemptions; requiring payment of the prevailing wage 
          for financial assistance; permitting the cities of 
          Bloomington and Roseville to impose lodging taxes; 
          changing truth-in-taxation requirements; modifying the 
          requirements for the collection and expenditure of tax 
          increments; requiring studies; imposing and 
          transferring powers and duties; changing certain 
          effective dates; allowing the sale of certain 
          tax-forfeited land in Otter Tail county; authorizing 
          special levies by the cities of Bayport, Windom, 
          Rosemount, Maple Grove, Brooklyn Park, Brooklyn 
          Center, and Coon Rapids, and Goodhue, Koochiching, 
          Douglas, Mille Lacs, and Becker counties; authorizing 
          issuance of bonds by the city of Bemidji; Beltrami and 
          Ramsey counties; special school district No. 1, 
          Minneapolis; independent school district No. 625, St. 
          Paul; independent school district No. 709, Duluth; 
          independent school district No. 316, Coleraine; 
          independent school district No. 381, Lake Superior; 
          independent school district No. 695, Chisholm; 
          independent school district No. 696, Ely; independent 
          school district No. 697, Eveleth; independent school 
          district No. 699, Gilbert; independent school district 
          No. 692, Babbitt; and independent school district No. 
          710, St. Louis county; providing a fund balance 
          correction for independent school district No. 624, 
          White Bear Lake; authorizing transfer of certain 
          Hennepin county money; appropriating money; amending 
          Minnesota Statutes 1988, sections 3.885, by adding a 
          subdivision; 16A.1541; 116.07, subdivision 4h; 
          124.195, subdivision 7; 136D.27, subdivision 2; 
          136D.74, subdivision 2a; 136D.87, subdivision 2; 
          169.86, subdivision 1; 270.07, by adding a 
          subdivision; 270.70, subdivisions 1, 2, 4, 8, and by 
          adding subdivisions; 270.701, by adding a subdivision; 
          270.709, subdivision 1; 271.12; 271.19; 273.124, by 
          adding subdivisions; 273.1398, by adding a 
          subdivision; 273.42, subdivision 1; 275.065, by adding 
          a subdivision; 275.125, subdivision 10; 275.55; 
          279.06; 281.17; 289A.50, as added, by adding a 
          subdivision; 290.068, subdivision 1; 290.31, 
          subdivision 1; 290.9725; 290A.03, subdivision 11, and 
          by adding a subdivision; 290A.19; 296.02, subdivision 
          1a; 296.025, subdivision 1a; 297.07, subdivision 5; 
          297A.01, subdivisions 15 and 16; 297A.25, subdivision 
          36, and by adding subdivisions; 298.015, subdivision 
          1; 298.017; 298.05; 298.24, subdivision 1; 469.043, 
          subdivision 5; 469.059, subdivision 11; 469.129, 
          subdivision 2; 469.171, by adding a subdivision; 
          469.174, subdivisions 11, 12, and by adding 
          subdivisions; 469.175, subdivision 1a, and by adding a 
          subdivision; 469.176, subdivisions 2 and 3; 469.177, 
          subdivision 8; 473.845, subdivision 4; 475.53, by 
          adding a subdivision; 477A.011, by adding 
          subdivisions; 477A.012, subdivisions 1, 3, and by 
          adding a subdivision; 477A.013, by adding a 
          subdivision; 477A.03, subdivision 1; 477A.11, 
          subdivision 4; 477A.13; 500.24, subdivision 4; 611.20; 
          611.215, subdivision 1; 611.26, subdivision 3; 611.27; 
          611.271; and 629.292, subdivision 1; Minnesota 
          Statutes 1989 Supplement, sections 103B.3369, 
          subdivisions 5 and 7; 115A.981, subdivision 3; 124.10, 
          subdivision 2; 124.83, subdivision 6; 136D.27, 
          subdivision 3; 136D.74, subdivision 2b; 136D.87, 
          subdivision 3; 270.10, subdivision 1a; 270.69, 
          subdivision 11; 273.11, subdivision 1; 273.112, 
          subdivision 3; 273.119, subdivision 2; 278.05, 
          subdivision 4; 282.01, subdivision 1; 290.01, 
          subdivision 19; 290.9201, by adding a subdivision; 
          290A.04, subdivision 5; 375.192, subdivision 2; 
          462.396, subdivision 2; 469.175, subdivision 4; 
          469.176, subdivision 4c; 469.177, subdivision 9; 
          611.26, subdivision 2; Minnesota Statutes Second 1989 
          Supplement, sections 3.885, subdivision 8; 3.982; 
          60A.15, subdivision 1; 124.83, subdivision 1; 256.025, 
          subdivision 4; 272.02, subdivision 4; 273.064; 
          273.123, subdivision 4; 273.13, subdivisions 22, 23, 
          24, and 25, as amended; 273.1398, subdivisions 1, 2, 
          and 6; 273.371, subdivision 1; 275.065, subdivisions 
          1, 3, and 6; 275.07, subdivisions 1 and 3; 275.50, 
          subdivision 5; 275.51, subdivisions 3f, as amended, 
          3h, and 4; 276.04, subdivision 2; 290.05, subdivision 
          1; 290.06, subdivisions 1 and 21; 290.091, subdivision 
          2; 290.0921, subdivisions 1, 3, 8, and by adding a 
          subdivision; 290A.04, subdivisions 2a and 2h; 357.021, 
          subdivision 1a; 469.171, subdivision 7a; 469.174, 
          subdivisions 7 and 10; 469.175, subdivisions 3 and 7; 
          469.176, subdivisions 1 and 4j; 469.177, subdivision 
          10; 469.190, subdivisions 1, 2, and 3; 473H.10, 
          subdivision 3; 477A.011, subdivisions 1a and 25; 
          477A.013, subdivisions 3, 5, and 6; Laws 1959, chapter 
          462, section 3, subdivision 10, as amended; Laws 1988, 
          chapter 719, article 12, section 30, as amended; Laws 
          1989, chapter 326, article 3, section 49; chapter 335, 
          article 3, sections 38, 44, 54, subdivision 8, and 58, 
          as amended; chapter 353, section 13; Laws 1989, First 
          Special Session chapter 1, article 5, section 52; Laws 
          1990, chapter 480, article 1, section 3, subdivision 
          14; and article 8, section 18; proposing coding for 
          new law in Minnesota Statutes, chapters 116J; 134; 
          270; 273; 289A; 290; and 469; repealing Minnesota 
          Statutes 1988, sections 115A.09, subdivision 5; 
          325E.045, subdivisions 3 and 4; Minnesota Statutes 
          1989 Supplement, sections 115A.922; 115A.923, 
          subdivisions 2, 3, 4, and 5; 115A.924; 115A.925; 
          115A.927; 115A.928; 375.192, subdivision 1; 383A.65; 
          Minnesota Statutes Second 1989 Supplement, sections 
          273.1398, subdivision 2b; 290.06, subdivision 1a; and 
          290A.045; Laws 1987, chapter 348, section 51, 
          subdivision 5. 
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 

                                ARTICLE 1

                       TAXPAYERS' BILL OF RIGHTS
    Section 1.  [270.0602] [BASIS FOR EVALUATION OF DEPARTMENT 
OF REVENUE EMPLOYEES.] 
    The department of revenue must not use tax enforcement 
results to impose individual revenue quotas with respect to 
employees or their immediate supervisors who are directly 
involved in assessment or collection activities.  The department 
may, however, use individual performance with regard to number 
of cases completed and, in the case of collections employees, 
dollars collected, as factors in evaluating an employee and not 
be considered as failing to comply with this section. 
    Sec. 2.  [270.0603] [DISCLOSURE OF RIGHTS OF TAXPAYERS.] 
    Subdivision 1.  [IN GENERAL.] The commissioner of revenue 
shall, as soon as practicable, but not later than 180 days after 
the date of enactment of this act, prepare statements that set 
forth in simple and nontechnical terms: 
    (1) the rights and obligations of the department of revenue 
and the taxpayer during an audit; 
    (2) the procedures by which a taxpayer may appeal an 
adverse decision of the department, including administrative and 
judicial appeals; 
    (3) the procedures for filing refund claims and filing of 
taxpayer complaints; and 
    (4) the procedures that the department may use in enforcing 
the tax laws, including assessment, jeopardy assessment, levy 
and distraint, and the filing of liens. 
    Subd. 2.  [TRANSMISSION TO LEGISLATURE.] The commissioner 
shall provide drafts of the statements required under 
subdivision 1 to the chairs of the house of representatives and 
senate tax committees for proposed revisions of the statements. 
    Subd. 3.  [DISTRIBUTION.] The appropriate statement 
prepared in accordance with subdivisions 1 and 2 must be 
distributed by the commissioner to all taxpayers contacted with 
respect to the determination or collection of a tax, other than 
the providing of tax forms.  Failure to receive the statement 
does not invalidate the determination or collection action. 
    Sec. 3.  Minnesota Statutes 1988, section 270.07, is 
amended by adding a subdivision to read: 
    Subd. 6.  [ABATEMENT OF PENALTY.] (a) A request for 
abatement of penalty under subdivision 1, under section 289A.60, 
subdivision 4, or under paragraph (c), must be filed with the 
commissioner within 60 days of the date the notice was mailed to 
the taxpayer's last known address, stating that a penalty has 
been imposed. 
    (b) If the commissioner issues an order denying a request 
for abatement of penalty, the taxpayer may, except as limited 
under subdivision 1, file an administrative appeal as provided 
in section 289A.65 or appeal to tax court as provided in section 
271.06. 
    If the commissioner does not issue an order on the 
abatement request within 60 days from the date the request is 
received, the taxpayer may appeal to tax court as provided in 
section 271.06. 
    (c) The commissioner shall abate any part of a penalty or 
additional tax charge under section 289A.25, subdivision 2, or 
289A.26, subdivision 4, attributable to erroneous advice given 
to the taxpayer in writing by an employee of the department 
acting in an official capacity, if the advice:  
    (1) was reasonably relied on and was in response to a 
specific written request of the taxpayer; and 
    (2) was not the result of failure by the taxpayer to 
provide adequate or accurate information. 
    Sec. 4.  Minnesota Statutes 1989 Supplement, section 
270.10, subdivision 1a, is amended to read: 
    Subd. 1a.  [NOTIFICATION TO TAXPAYER.] At the same time 
that notice of the assessment, determination, or order of the 
commissioner is given to a taxpayer, the taxpayer must be 
notified in writing of the right to appeal to the tax court, and 
if applicable, to the small claims division.  Except in the case 
of mathematical or clerical errors, the notice must contain a 
description of the basis for, including applicable law and other 
factors considered in the determination, and a listing of the 
amounts of tax due, interest, additions to tax, and penalties.  
Failure to provide all the required information does not 
invalidate the notice for purposes of satisfying statutory 
notice requirements if the notice contains sufficient 
information to advise the taxpayer that an assessment, order, or 
other determination has been made.  The taxpayer may request 
further clarification within the time provided for appealing the 
determination.  In any notice of assessment, determination, or 
order dealing with property valuation or assessment for property 
tax purposes by the commissioner of revenue or a local unit of 
government, the taxpayer must be notified in writing that a 
taxpayer must appeal to the town or city board of equalization 
and to the county board of equalization before appealing to the 
small claims division of the tax court, except for those 
taxpayers whose original assessments are determined by the 
commissioner of revenue.  
    Sec. 5.  [270.272] [PROCEDURES INVOLVING IN-PERSON TAXPAYER 
INTERVIEWS.] 
     Subdivision 1.  [RECORDING OF INTERVIEWS.] (a) In 
connection with an interview with a taxpayer relating to the 
audit or collection of a tax, and on advance request of the 
taxpayer, an employee of the department of revenue shall allow 
the taxpayer to make an audio recording of the interview at the 
taxpayer's expense and with the taxpayer's equipment. 
    (b) An employee of the department may record an interview 
described in paragraph (a) if the taxpayer is informed of the 
recording before the interview and a transcript or copy of the 
recording is made available to the taxpayer on the taxpayer's 
request, provided the department is reimbursed by the taxpayer 
for the cost of transcribing or copying the recording. 
    Subd. 2.  [SAFEGUARDS.] (a) Before or at the start of an 
initial interview, an employee of the department shall provide 
to the taxpayer in the case of an audit interview an explanation 
of the audit process and the taxpayer's rights under that 
process and, in the case of a collection interview, an 
explanation of the collection process and the taxpayer's rights 
under that process. 
     (b) If a taxpayer requests to consult with an attorney, 
accountant, agent, preparer, or any other person permitted to 
represent the taxpayer before the department at any time during 
an interview, except an interview initiated by an administrative 
subpoena, the interview must be suspended for no more than 30 
days. 
     Subd. 3.  [REPRESENTATIVES HOLDING POWER OF ATTORNEY.] An 
attorney, accountant, agent, preparer, or any other person 
permitted to represent the taxpayer before the department who 
has a written power of attorney executed by the taxpayer may 
represent the taxpayer in an interview described in subdivision 
1.  The taxpayer may be required to accompany the representative 
only if an administrative subpoena is issued.  In this instance, 
with the consent of an immediate supervisor and after ten days' 
notice to the representative, the department employee may notify 
the taxpayer directly that the employee believes the 
representative is unreasonably delaying the examination or 
investigation process. 
    Subd. 4.  [NOT TO APPLY TO CERTAIN INVESTIGATIONS.] This 
section does not apply to criminal investigations or 
investigations relating to the conduct of an employee of the 
department.  
    Sec. 6.  [270.273] [TAXPAYER ASSISTANCE ORDERS; TAXPAYER'S 
RIGHTS ADVOCATE.] 
    Subdivision 1.  [AUTHORITY TO ISSUE.] On application filed 
by a taxpayer with the department of revenue taxpayer's rights 
advocate, in the form, manner, and in the time prescribed by the 
commissioner, and after thorough investigation, the taxpayer's 
rights advocate may issue a taxpayer assistance order if, in the 
determination of the taxpayer's rights advocate, the manner in 
which the state tax laws are being administered is creating or 
will create an unjust and inequitable result for the taxpayer. 
    Subd. 2.  [TERMS OF A TAXPAYER ASSISTANCE ORDER.] A 
taxpayer assistance order may require the department to release 
property of the taxpayer levied on, cease any action, or refrain 
from taking any action to enforce the state tax laws against the 
taxpayer, until the issue or issues giving rise to the order 
have been resolved. 
    Subd. 3.  [AUTHORITY TO MODIFY OR RESCIND.] A taxpayer 
assistance order issued by the taxpayer's rights advocate under 
this section may be modified or rescinded by the commissioner. 
     Subd. 4.  [SUSPENSION OF RUNNING OF PERIOD OF 
LIMITATION.] The running of the period of limitation with 
respect to an action described in subdivision 2 is suspended 
from the date of the taxpayer assistance order until the 
expiration date of the order or, if modified, the expiration 
date of the modified order or, if rescinded, the date of the 
rescission. 
    Subd. 5.  [INDEPENDENT ACTION OF TAXPAYER'S RIGHTS 
ADVOCATE.] This section does not prevent the taxpayer's rights 
advocate from taking action in the absence of an application 
under subdivision 1. 
    Subd. 6.  [TAXPAYER'S RIGHTS ADVOCATE.] For purposes of 
this section, the term "taxpayer's rights advocate" includes a 
designee of the taxpayer's rights advocate.  The taxpayer's 
rights advocate shall represent the interests of taxpayers who 
have grievances against the department in connection with an 
audit or collection activity, and shall report directly to the 
commissioner.  A determination of the taxpayer's rights advocate 
under this section to issue or to not issue a taxpayer 
assistance order is final, and cannot be appealed to the tax 
court or any other court. 
    Sec. 7.  [270.274] [REVIEW OF JEOPARDY ASSESSMENT AND LEVY 
PROCEDURES.] 
    Subdivision 1.  [ADMINISTRATIVE REVIEW.] Within five days 
after a jeopardy assessment or collection is made to assess or 
collect a tax administered by the commissioner of revenue, the 
commissioner shall provide the taxpayer with a written statement 
of the information relied on in making the assessment or levy.  
Within 30 days after the written statement is provided or, if 
not provided, within 35 days after the assessment or levy, the 
taxpayer may request the commissioner to review the action 
taken.  After a request for review, the commissioner shall 
determine whether the assessment or levy is reasonable and 
whether the amount assessed or demanded as a result of the 
action is appropriate under the circumstances. 
    Subd. 2.  [JUDICIAL REVIEW.] A determination by the 
commissioner under subdivision 1 is appealable to the tax court 
in the manner provided by law, and the appeal must be 
expeditiously heard by the court.  If the court determines that 
the making of the assessment or levy is unreasonable, or that 
the amount assessed or demanded is inappropriate, the court may 
order the commissioner to release the levy, abate the 
assessment, redetermine in whole or in part the amount assessed 
or demanded, or take other action.  A determination by the court 
under this subdivision is final and may not be appealed by 
either party. 
    Subd. 3.  [BURDEN OF PROOF.] In a proceeding under 
subdivision 2, the burden of proving that the assessment or 
collection of the tax was jeopardized by delay is on the 
commissioner.  Regarding the issue of whether the amount 
assessed or demanded as a result of the action is appropriate, 
the commissioner shall provide a written statement explaining 
the basis for determining the amount, and the burden is on the 
taxpayer to show that the statement is incorrect or invalid. 
    Sec. 8.  [270.275] [CIVIL DAMAGES FOR FAILURE TO RELEASE 
LIEN.] 
    Subdivision 1.  [IN GENERAL.] (a) A taxpayer may bring a 
civil action for damages against the commissioner in district 
court when an employee or the department has knowingly or 
negligently: 
    (1) failed to release a lien as required by section 270.69, 
subdivision 11; or 
    (2) failed to release a lien within 30 days after 
satisfaction of the liability on which the lien is based. 
    (b) An action under paragraph (a), clause (2), must be 
preceded by 30 days written notice by the taxpayer to the 
commissioner and the taxpayer's rights advocate that the lien 
has not been released.  An action under paragraph (a) must be 
commenced within two years after the date the right of action 
accrued. 
    Subd. 2.  [DAMAGES.] On a finding of liability on the part 
of the defendant in an action brought under subdivision 1, the 
defendant is liable to the plaintiff in an amount equal to the 
sum of actual, direct economic damages sustained by the 
plaintiff due to the actions of the defendant, plus the costs of 
the action.  Damages must be paid in accordance with section 
3.736, subdivision 7. 
    Subd. 3.  [MITIGATION OF DAMAGES.] Damages awarded must be 
reduced by the amount of the damages that could reasonably have 
been mitigated by the plaintiff. 
    Sec. 9.  [270.276] [CIVIL DAMAGES FOR CERTAIN UNAUTHORIZED 
COLLECTION ACTIONS.] 
    Subdivision 1.  [IN GENERAL.] If in connection with the 
collection of previously determined delinquent taxes from a 
taxpayer of a state tax administered by the commissioner of 
revenue, an employee of the department recklessly or 
intentionally disregards a state tax law or rule, the taxpayer 
may bring a civil action for damages against the commissioner in 
district court within two years after the date the right of 
action accrues. 
    Subd. 2.  [DAMAGES.] On a finding of liability on the part 
of the defendant in an action brought under subdivision 1, the 
defendant is liable to the plaintiff in an amount equal to the 
lesser of $100,000, or the sum of (1) actual, direct economic 
damages sustained by the plaintiff as a proximate result of the 
reckless or intentional actions of the employee and (2) the 
costs of the action.  Damages must be paid in accordance with 
section 3.736, subdivision 7. 
     Subd. 3.  [LIMITATIONS.] A judgment for damages must not be 
awarded under subdivision 2 unless the court determines that the 
plaintiff has exhausted the administrative remedies available to 
the plaintiff within the department.  Damages awarded must be 
reduced by the amount of the damages that could reasonably have 
been mitigated by the plaintiff. 
    Subd. 4.  [PENALTIES FOR PROCEDURES INSTITUTED PRIMARILY 
FOR DELAY.] When it appears to the district court that: 
    (1) proceedings before it under this section have been 
instituted or maintained by the taxpayer primarily for delay; 
    (2) the taxpayer's position in such proceeding is frivolous 
or groundless; or 
    (3) the taxpayer unreasonably failed to pursue available 
administrative remedies, 
the district court, in its decision, may require the taxpayer to 
pay to the department of revenue a penalty not in excess of 
$25,000.  The penalty may be assessed and, upon notice and 
demand, may be collected in the same manner as a tax. 
    Sec. 10.  Minnesota Statutes 1989 Supplement, section 
270.69, subdivision 11, is amended to read: 
    Subd. 11.  [ERRONEOUS LIENS.] After the filing of a notice 
of lien under this section on the property or rights to property 
of a person, the person may appeal to the commissioner, in the 
form and at the time prescribed by the commissioner, alleging an 
error in the filing of the lien and requesting its release.  If 
the commissioner of revenue determines that the filing of the 
notice of any lien was erroneous, within 14 days after the 
determination, the commissioner must issue a certificate of 
release of the lien.  The certificate must include a statement 
that the filing of the lien was erroneous.  In the event that 
the claim lien is erroneous and is not released within the 
14-day period, reasonable attorney fees shall be paid.  Damages 
must be paid in accordance with section 3.736, subdivision 7. 
    Sec. 11.  Minnesota Statutes 1988, section 270.70, 
subdivision 1, is amended to read: 
    Subdivision 1.  [AUTHORITY OF COMMISSIONER.] If any tax 
payable to the commissioner of revenue or to the department of 
revenue is not paid when due, such tax may be collected by the 
commissioner of revenue within five years after the date of 
assessment of the tax, or if the tax judgment has been filed, 
within the statutory period of enforcement of a valid tax 
judgment, by a levy upon all property and rights to property, 
including any property in the possession of law enforcement 
officials, of the person liable for the payment or collection of 
such tax (except that which is exempt from execution pursuant to 
section 550.37 and amounts received under United States Code, 
title 29, chapter 19, as amended through December 31, 1989) or 
property on which there is a lien provided in section 270.69.  
For this purpose, the term "tax" shall include any penalty, 
interest and costs properly payable.  The term "levy" includes 
the power of distraint and seizure by any means. 
    Sec. 12.  Minnesota Statutes 1988, section 270.70, 
subdivision 2, is amended to read: 
    Subd. 2.  [NOTICE AND DEMAND; COLLECTION BY LEVY; JEOPARDY 
COLLECTION.] Before a levy is made, notice and demand for 
payment of the amount due shall must be given to the person 
liable for the payment or collection of the tax at least ten 30 
days prior to the levy.  If the commissioner has reason to 
believe that collection of the tax is in jeopardy, notice and 
demand for immediate payment of the tax may be made by the 
commissioner.  If the tax is not paid, the commissioner may 
proceed to collect by levy without regard to the ten day period 
provided herein.  The notice required under this subdivision 
must be sent to the taxpayer's last known address and must 
include a brief statement that sets forth in simple and 
nontechnical terms: 
    (1) the administrative appeals available to the taxpayer 
with respect to the levy and sale; and 
    (2) the alternatives available to the taxpayer that can 
prevent a levy, including installment payment agreements under 
section 270.67, subdivision 2. 
    Sec. 13.  Minnesota Statutes 1988, section 270.70, 
subdivision 4, is amended to read: 
    Subd. 4.  [STAY OF SALE.] (a) Where a jeopardy assessment 
or any other assessment has been made by the commissioner, the 
property seized for collection of the tax shall not be sold 
until the time has expired for filing an appeal of the 
assessment with the tax court pursuant to chapter 271.  If an 
appeal has been filed, no sale shall be made unless the taxes 
remain unpaid for a period of more than 30 days after final 
determination of the appeal by the tax court or by the 
appropriate judicial forum. 
    (b) Notwithstanding clause (a), seized property may be sold 
if 
    (i) the taxpayer consents in writing to the sale, or 
    (ii) the commissioner determines that the property is 
perishable or may become greatly reduced in price or value by 
keeping, or that such property cannot be kept without great 
expense. 
    The tax court has jurisdiction to review a determination 
made under clause (b)(ii).  Review is commenced by motion of the 
commissioner or the taxpayer.  The order of the court in 
response to the motion is reviewable in the same manner as any 
other decision of the tax court. 
    Sec. 14.  Minnesota Statutes 1988, section 270.70, 
subdivision 8, is amended to read: 
    Subd. 8.  [SURRENDER OF PROPERTY SUBJECT TO LEVY.] Any 
person who fails or refuses to surrender without reasonable 
cause any property or rights to property subject to levy, upon 
demand by the commissioner, shall be liable personally to the 
state of Minnesota in an amount equal to the value of the 
property or rights not so surrendered, but not exceeding the 
amount of taxes for the collection of which such levy has been 
made.  Any amount recovered under this subdivision shall be 
credited against the tax liability for the collection of which 
such levy was made.  A financial institution need not surrender 
funds on deposit until ten days after service of the levy. 
    Sec. 15.  Minnesota Statutes 1988, section 270.70, is 
amended by adding a subdivision to read: 
    Subd. 17.  [UNECONOMICAL LEVY.] No levy may be made on 
property if the amount of the expenses that the commissioner 
estimates would be incurred by the department with respect to 
the levy and sale of the property exceeds the fair market value 
of the property at the anticipated time of levy. 
    Sec. 16.  Minnesota Statutes 1988, section 270.70, is 
amended by adding a subdivision to read: 
    Subd. 18.  [LEVY ON APPEARANCE DATE OF SUBPOENA.] No levy 
may be made on the property of a person on the day on which the 
person, or an officer or employee of the person, is required to 
appear in response to a subpoena issued by the commissioner to 
collect unpaid taxes, unless the commissioner determines that 
the collection of the tax is in jeopardy. 
    Sec. 17.  Minnesota Statutes 1988, section 270.701, is 
amended by adding a subdivision to read: 
     Subd. 6.  [RIGHT TO REQUEST SALE OF SEIZED PROPERTY WITHIN 
60 DAYS.] The owner of property seized by levy may request that 
the commissioner offer to sell the property within 60 days after 
the request, or within a longer period requested by the owner.  
The request must be complied with unless the commissioner 
determines and notifies the owner within that period that 
compliance is not in the best interests of the state of 
Minnesota.  A determination by the commissioner not to comply 
with the request is appealable to the tax court in the manner 
provided by law. 
    Sec. 18.  Minnesota Statutes 1988, section 270.709, 
subdivision 1, is amended to read: 
    Subdivision 1.  [RELEASE OF LEVY.] It shall be lawful for 
the commissioner to release the levy upon all or part of the 
property or rights to property levied upon if the commissioner 
determines that the release will facilitate the collection of 
the liability, but the release shall not operate to prevent any 
subsequent levy.  The commissioner shall release a levy on all 
or part of the property or rights to property levied on and 
shall promptly notify the person on whom the levy was made that 
the levy has been released if:  (1) the liability for which the 
levy was made is satisfied or has become unenforceable by lapse 
of time; (2) release of the levy will facilitate collection of 
the liability; (3) the taxpayer has entered into an installment 
payment agreement under section 270.67, subdivision 2, unless 
the agreement provides otherwise, or unless release of the levy 
will jeopardize the status of the department as a secured 
creditor; or (4) the fair market value of the property exceeds 
the liability, and release of the levy on a part of the property 
can be made without hindering collection.  In the case of 
tangible personal property essential in carrying on the trade or 
business of the taxpayer, the commissioner shall provide for an 
expedited determination under this subdivision.  A release of 
levy under this subdivision does not prevent a subsequent levy 
on the property released. 
    Sec. 19.  Minnesota Statutes 1988, section 271.12, is 
amended to read: 
    271.12 [WHEN ORDER EFFECTIVE.] 
    No order for refundment by the commissioner of revenue, the 
appropriate unit of government, or the tax court shall take 
effect until the time for appeal therefrom or review thereof by 
all parties entitled thereto has expired.  Otherwise every order 
of the commissioner, the appropriate unit of government, or the 
tax court shall take effect immediately upon the filing thereof, 
and no appeal therefrom or review thereof shall stay the 
execution thereof or extend the time for payment of any tax or 
other obligation unless otherwise expressly provided by law; 
provided, that in case an order which has been acted upon, in 
whole or in part, shall thereafter be set aside or modified upon 
appeal, the determination upon appeal or review shall supersede 
the order appealed from and be binding upon all parties affected 
thereby, and such adjustments as may be necessary to give effect 
thereto shall be made accordingly; and provided further, the tax 
court may enjoin enforcement of the order of the commissioner 
being appealed.  If it be finally determined upon such appeal or 
review that any person is entitled to refundment of any amount 
which has been paid for a tax or other obligation, such amount, 
unless otherwise provided by law, shall be paid to the person by 
the state treasurer, or other proper officer, out of funds 
derived from taxes of the same kind, if available for the 
purpose, or out of other available funds, if any, with interest 
at the rate specified in section 270.76 from the date of payment 
of the tax, unless a different rate of interest is otherwise 
provided by law, in which case such other rate shall apply, upon 
certification by the commissioner of revenue, the appropriate 
unit of government, the tax court or the supreme court.  
    If, within 120 days after a decision of the tax court 
becomes final, the commissioner does not refund the overpayment 
determined by the court, together with interest, on motion by 
the taxpayer, the tax court shall have jurisdiction to order the 
refund of the overpayment and interest, and to award reasonable 
litigation costs for bringing the motion.  If any tax, 
assessment, or other obligation be increased upon such appeal or 
review, the increase shall be added to the original amount, and 
may be enforced and collected therewith. 
    Sec. 20.  Minnesota Statutes 1988, section 271.19, is 
amended to read: 
    271.19 [COSTS AND DISBURSEMENTS.] 
    Upon the determination of any appeal under this chapter 
before the tax court, or of any review hereunder by the supreme 
court, the costs and disbursements may be taxed and allowed in 
favor of the prevailing party and against the losing party as in 
civil actions.  In any case where a person liable for a tax or 
other obligation has lost an appeal or review instituted by the 
person, and the tax court or court shall determine that the 
person instituted the same merely for the purposes of delay, or 
that the taxpayer's position in the proceedings is frivolous, 
additional costs, commensurate with the expense incurred and 
services performed by the agencies of the state in connection 
with the appeal, but not exceeding $5,000 in any case, may be 
allowed against the taxpayer, in the discretion of the tax court 
or court.  Costs and disbursements allowed against any such 
person shall be added to the tax or other obligation determined 
to be due, and shall be payable therewith.  To the extent 
described in section 3.761, where an award of costs and attorney 
fees is authorized under section 3.762, the costs and fees shall 
be allowed against the state, including expenses incurred by the 
taxpayer to administratively protest or appeal to the department 
of revenue the order, decision, or report of the commissioner 
that is the subject of the tax court proceedings.  Costs and 
disbursements allowed against the state or other public agencies 
shall be paid out of funds received from taxes or other 
obligations of the kind involved in the proceeding, or other 
funds of the agency concerned appropriated and available 
therefor.  Witnesses in proceedings under this chapter shall 
receive like fees as in the district court, to be paid in the 
first instance by the parties by whom the witnesses were called, 
and to be taxed and allowed as herein provided. 
    Sec. 21.  Minnesota Statutes, section 289A.50, as added in 
Laws 1990, chapter 480, article 1, section 23, is amended by 
adding a subdivision to read: 
    Subd. 9.  [PETITION IN TAX COURT; REFUND OF 
INTEREST.] Notwithstanding any other law, within one year after 
a decision of the tax court upholding an assessment of the 
commissioner of revenue becomes final, if the taxpayer has paid 
the assessment in full, plus interest calculated by the 
commissioner, the taxpayer may petition the tax court to reopen 
the case solely for a determination that the interest paid 
exceeds the interest legally due, and if so, the amount of the 
overpayment.  A determination of overpayment of interest under 
this subdivision is a determination of overpayment of tax under 
section 271.12, and is reviewable in the same manner as any 
other decision of the tax court. 
    Sec. 22.  [ALTERNATIVE DISPUTE RESOLUTION; LETTER RULINGS; 
STUDY.] 
    The commissioner of revenue shall study the cost, 
feasibility, and means of implementation of (1) an arbitration 
procedure for resolving disputes between taxpayers and the 
department of revenue without court litigation, and (2) 
publication and dissemination of administrative determinations, 
decisions, and rulings of the department of revenue, through the 
use of private letter rulings or otherwise.  In preparing the 
study, the commissioner shall consult with the bar association 
and society of certified public accountants.  The commissioner 
shall report the results of the study to the legislature by 
January 7, 1991. 
    Sec. 23.  [EFFECTIVE DATES.] 
    Section 1 is effective for evaluations occurring on or 
after August 1, 1990. 
    Sections 2 and 22 are effective the day following final 
enactment. 
    Section 3 is effective for advice given on or after August 
1, 1990. 
    Section 4 is effective for notices of assessment issued on 
or after August 1, 1990. 
    Section 5 is effective for interviews occurring on or after 
August 1, 1990. 
    Section 6 is effective for taxpayer assistance applications 
filed on or after August 1, 1990. 
    Section 7 is effective for jeopardy assessments and levies 
made on or after August 1, 1990. 
    Sections 8 and 9 are effective for causes of action arising 
on or after August 1, 1990. 
    Section 10 is effective for liens filed on or after August 
1, 1990. 
    Sections 11, 15, and 16 are effective August 1, 1990. 
    Sections 12, 14, and 18 are effective for levies issued on 
or after August 1, 1990. 
    Sections 13 and 17 are effective for property seized on or 
after August 1, 1990. 
    Sections 19 and 20 are effective for tax court appeals 
filed on or after August 1, 1990. 
    Section 21 is effective for interest payments made on or 
after August 1, 1990. 

                                ARTICLE 2

                         INCOME, GROSS PREMIUMS,
 AND FRANCHISE TAXES
    Section 1.  Minnesota Statutes Second 1989 Supplement, 
section 60A.15, subdivision 1, is amended to read: 
    Subdivision 1.  [DOMESTIC AND FOREIGN COMPANIES.] (a) On or 
before April 15, June 15, and December 15 of each year, every 
domestic and foreign company, including town and farmers' mutual 
insurance companies and domestic mutual insurance companies, 
shall pay to the commissioner of revenue installments equal to 
one-third of the insurer's total estimated tax for the current 
year.  Except as provided in paragraph (b), installments must be 
based on a sum equal to two percent of the premiums described in 
paragraph (c).  
    (b) For town and farmers' mutual insurance companies and 
mutual property and casualty insurance companies other than 
those (i) writing life insurance, or (ii) whose total assets at 
the end of the preceding calendar year exceed on December 31, 
1989, exceeded $1,600,000,000, the installments must be based on 
an amount equal to the following percentages of the premiums 
described in paragraph (c): 
    (1) for premiums paid after December 31, 1988, and before 
January 1, 1992, one percent; and 
    (2) for premiums paid after December 31, 1991, one-half of 
one percent. 
    (c) Installments under paragraph (a) or (b) are percentages 
of gross premiums less return premiums on all direct business 
received by the insurer in this state, or by its agents for it, 
in cash or otherwise, during such year, excepting premiums 
written for marine insurance as specified in subdivision 6.  
    (d) Failure of a company to make payments of at least 
one-third of either (1) the total tax paid during the previous 
calendar year or (2) 80 percent of the actual tax for the 
current calendar year shall subject the company to the penalty 
and interest provided in this section. 
    Sec. 2.  Minnesota Statutes 1989 Supplement, section 
290.01, subdivision 19, is amended to read:  
    Subd. 19.  [NET INCOME.] The term "net income" means the 
federal taxable income, as defined in section 63 of the Internal 
Revenue Code of 1986, as amended through the date named in this 
subdivision, incorporating any elections made by the taxpayer in 
accordance with the Internal Revenue Code in determining federal 
taxable income for federal income tax purposes, and with the 
modifications provided in subdivisions 19a to 19f.  
    In the case of a regulated investment company or a fund 
thereof, as defined in section 851(a) or 851(h) of the Internal 
Revenue Code, federal taxable income means investment company 
taxable income as defined in section 852(b)(2) of the Internal 
Revenue Code, except that:  
    (1) the exclusion of net capital gain provided in section 
852(b)(2)(A) of the Internal Revenue Code does not apply; and 
    (2) the deduction for dividends paid under section 
852(b)(2)(D) of the Internal Revenue Code must be applied by 
allowing a deduction for capital gain dividends and 
exempt-interest dividends as defined in sections 852(b)(3)(C) 
and 852(b)(5) of the Internal Revenue Code.  
    The net income of a real estate investment trust as defined 
and limited by section 856(a), (b), and (c) of the Internal 
Revenue Code means the real estate investment trust taxable 
income as defined in section 857(b)(2) of the Internal Revenue 
Code.  
    The Internal Revenue Code of 1986, as amended through 
December 31, 1986, shall be in effect for taxable years 
beginning after December 31, 1986.  The provisions of sections 
10104, 10202, 10203, 10204, 10206, 10212, 10221, 10222, 10223, 
10226, 10227, 10228, 10611, 10631, 10632, and 10711 of the 
Omnibus Budget Reconciliation Act of 1987, Public Law Number 
100-203, and the provisions of sections 1001, 1002, 1003, 1004, 
1005, 1006, 1008, 1009, 1010, 1011, 1011A, 1011B, 1012, 1013, 
1014, 1015, 1018, 2004, 3041, 4009, 6007, 6026, 6032, 6137, 
6277, and 6282 of the Technical and Miscellaneous Revenue Act of 
1988, Public Law Number 100-647, and the provisions of sections 
7811, 7816, and 7831 of the Omnibus Budget Reconciliation Act of 
1989, Public Law Number 101-239, shall be effective at the time 
they become effective for federal income tax purposes.  
    The Internal Revenue Code of 1986, as amended through 
December 31, 1987, shall be in effect for taxable years 
beginning after December 31, 1987.  The provisions of sections 
4001, 4002, 4011, 5021, 5041, 5053, 5075, 6003, 6008, 6011, 
6030, 6031, 6033, 6057, 6064, 6066, 6079, 6130, 6176, 6180, 
6182, 6280, and 6281 of the Technical and Miscellaneous Revenue 
Act of 1988, Public Law Number 100-647, and the provisions of 
sections 7815 and 7821 of the Omnibus Budget Reconciliation Act 
of 1989, Public Law Number 101-239, shall become effective at 
the time they become effective for federal tax purposes.  
    The Internal Revenue Code of 1986, as amended through 
December 31, 1988, shall be in effect for taxable years 
beginning after December 31, 1988.  The provisions of sections 
7101, 7102, 7104, 7105, 7201, 7202, 7203, 7204, 7205, 7206, 
7207, 7210, 7211, 7301, 7302, 7303, 7304, 7601, 7621, 7622, 
7641, 7642, 7645, 7647, 7651, and 7652 of the Omnibus Budget 
Reconciliation Act of 1989, Public Law Number 101-239, and the 
provision of section 1401 of the Financial Institutions Reform, 
Recovery, and Enforcement Act of 1989, Public Law Number 101-73, 
shall become effective at the time they become effective for 
federal tax purposes.  
    Except as otherwise provided, references to the Internal 
Revenue Code in subdivisions 19a to 19g mean the code in effect 
for purposes of determining net income for the applicable year. 
    Sec. 3.  Minnesota Statutes Second 1989 Supplement, section 
290.05, subdivision 1, is amended to read: 
    Subdivision 1.  The following corporations, individuals, 
estates, trusts, and organizations shall be exempted from 
taxation under this chapter, provided that every such person or 
corporation claiming exemption under this chapter, in whole or 
in part, must establish to the satisfaction of the commissioner 
the taxable status of any income or activity: 
    (a) corporations, individuals, estates, and trusts engaged 
in the business of mining or producing iron ore and other ores 
the mining or production of which is subject to the occupation 
tax imposed by section 298.01; but if any such corporation, 
individual, estate, or trust engages in any other business or 
activity or has income from any property not used in such 
business it shall be subject to this tax computed on the net 
income from such property or such other business or activity.  
Royalty shall not be considered as income from the business of 
mining or producing iron ore within the meaning of this section; 
    (b) the United States of America, the state of Minnesota or 
any political subdivision of either agencies or 
instrumentalities, whether engaged in the discharge of 
governmental or proprietary functions; 
    (c) any insurance company that is domiciled in a state or 
country other than Minnesota that imposes retaliatory taxes, 
fines, deposits, penalties, licenses, or fees and that does not 
grant, on a reciprocal basis, exemption from such retaliatory 
taxes to insurance companies or their agents domiciled in 
Minnesota.  "Retaliatory taxes" means taxes imposed on insurance 
companies organized in another state or country that result from 
the fact that an insurance company organized in the taxing 
jurisdiction and doing business in the other jurisdiction is 
subject to taxes, fines, deposits, penalties, licenses, or fees 
in an amount exceeding that imposed by the taxing jurisdiction 
upon an insurance company organized in the other state or 
country and doing business to the same extent in the taxing 
jurisdiction; and 
    (d) town and farmers' mutual insurance companies and mutual 
property and casualty insurance companies, other than those (1) 
writing life insurance or (2) whose total assets at the end of 
the preceding calendar year exceed on December 31, 1989, 
exceeded $1,600,000,000. 
    Sec. 4.  Minnesota Statutes Second 1989 Supplement, section 
290.06, subdivision 1, is amended to read: 
    Subdivision 1.  [COMPUTATION, CORPORATIONS.] The franchise 
tax imposed upon corporations shall be computed by applying to 
their taxable income the rate of 9.5 9.8 percent. 
    Sec. 5.  Minnesota Statutes Second 1989 Supplement, section 
290.06, subdivision 21, is amended to read: 
    Subd. 21.  [ALTERNATIVE MINIMUM TAX; FACTORS TAX.] (a) A 
corporation is allowed a credit for alternative minimum tax 
previously paid for any taxable year in which the corporation 
has no tax liability under section 290.092, subdivision 1, and 
has an alternative minimum tax credit carryover from a previous 
year.  The credit allowable in any taxable year equals the 
lesser of (1) the excess of the tax under this section 
subdivision 1 for the taxable year over the amount computed 
under section 290.092, subdivision 1, clause (1), for the 
taxable year, or (2) the alternative minimum tax credit 
carryover to the taxable year. 
    (b) The tax imposed under section 290.092, subdivision 1, 
for the taxable year is an alternative minimum tax credit 
carryover to each of the five taxable years succeeding the 
taxable year.  The entire amount of the alternative minimum tax 
credit must be carried to the earliest taxable year to which the 
amount may be carried.  The unused portion of the credit must be 
carried to the following taxable year.  No credit may be carried 
to a taxable year more than five years after the taxable year in 
which the alternative minimum tax under section 290.092, 
subdivision 1, was paid incurred. 
    (c) For taxable years beginning after December 31, 1989, 
qualification for a credit and computation of the amount of the 
credit for alternative minimum tax under paragraph (a) must be 
determined by computing the alternative minimum tax that would 
apply if section 290.092 were in effect for the taxable year. 
    Sec. 6.  Minnesota Statutes 1988, section 290.068, 
subdivision 1, is amended to read: 
    Subdivision 1.  [CREDIT ALLOWED.] A corporation, other than 
a corporation with a valid election in effect under section 
290.9725 1362 of the Internal Revenue Code of 1986, as amended 
through December 31, 1989, is allowed a credit against 
the portion of the franchise tax imposed by this chapter 
computed under section 290.06, subdivision 1, for the taxable 
year equal to: 
    (a) 5 percent of the first $2 million of the excess (if 
any) of 
    (1) the qualified research expenses for the taxable year, 
over 
    (2) the base period research expenses; and 
    (b) 2.5 percent on all of such excess expenses over $2 
million. 
    Sec. 7.  Minnesota Statutes Second 1989 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 alternative minimum taxable 
income as defined in section 55(b)(2) of the Internal Revenue 
Code; 
    (2) the taxpayer's itemized deductions allowed in computing 
federal alternative minimum taxable income, but excluding the 
portion of the Minnesota charitable contribution deduction that 
constitutes an item of tax preference under section 57(a)(6) of 
the Internal Revenue Code; 
    (3) to the extent not included in federal alternative 
minimum taxable income, the amount of interest income as 
provided by section 290.01, subdivision 19a, clause (1); less 
the sum of 
    (i) interest income as defined in section 290.01, 
subdivision 19b, clause (1); 
    (ii) an overpayment of state income tax as provided by 
section 290.01, subdivision 19b, clause (2); and 
    (iii) the amount of investment interest paid or accrued 
within the taxable year on indebtedness to the extent that the 
amount does not exceed net investment income, as defined in 
section 163(d)(4) of the Internal Revenue Code.  Interest does 
not include amounts deducted in computing federal adjusted gross 
income. 
    In the case of an estate or trust, alternative minimum 
taxable income must be computed as provided in section 59(c) of 
the Internal Revenue Code. 
    (b) "Internal Revenue Code" means the Internal Revenue Code 
of 1986, as amended through December 31, 1987 1989. 
    (c) "Investment interest" means investment interest as 
defined in section 163(d)(3) of the Internal Revenue Code. 
    (d) "Tentative minimum tax" equals six percent of 
alternative minimum taxable income after subtracting the 
exemption amount determined under subdivision 3. 
    (e) "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.  
    (f) "Net minimum tax" means the minimum tax imposed by this 
section. 
     (g) "Minnesota charitable contribution deduction" means a 
charitable contribution deduction under section 170 of the 
Internal Revenue Code to or for the use of an entity described 
in section 290.21, subdivision 3, clauses (a) to (e). 
    Sec. 8.  Minnesota Statutes Second 1989 Supplement, section 
290.0921, subdivision 1, is amended to read: 
    Subdivision 1.  [TAX IMPOSED.] (a) In addition to the taxes 
computed under this chapter without regard to this section, the 
franchise tax imposed on corporations includes a tax equal to 
the excess, if any, for the taxable year of:  
    (1) seven 5.8 percent of Minnesota alternative minimum 
taxable income less the credit allowed under section 290.35, 
subdivision 3; over 
    (2) the tax imposed under section 290.06, subdivision 1, 
without regard to this section.  
    (b) If the sum of the corporation's Minnesota sales and 
receipts, property, and payrolls, as defined in section 290.092, 
subdivision 4, exceeds $5,000,000, the amount under paragraph 
(a), clause (1), is the greater of 
    (1) $500 or 
    (2) the amount otherwise determined. 
    The provisions of this paragraph do not apply to 
corporations subject to tax under section 60A.15, subdivision 1; 
real estate investment trusts; and regulated investment 
companies or a fund thereof. 
    Sec. 9.  Minnesota Statutes Second 1989 Supplement, section 
290.0921, subdivision 3, is amended to read: 
    Subd. 3.  [ALTERNATIVE MINIMUM TAXABLE INCOME.] 
"Alternative minimum taxable income" is Minnesota net income as 
defined in section 290.01, subdivision 19, and includes the 
adjustments and tax preference items in sections 56, 57, 58, and 
59(d), (e), (f) and (h) of the Internal Revenue Code.  If a 
corporation files a separate company Minnesota tax return, the 
minimum tax must be computed on a separate company basis.  If a 
corporation is part of a tax group filing a unitary return, the 
minimum tax must be computed on a unitary basis.  The following 
adjustments must be made. 
    (1) For purposes of the depreciation adjustments under 
section 56(a)(1) and 56(g)(4)(A) of the Internal Revenue Code, 
the basis for depreciable property placed in service in a 
taxable year beginning before January 1, 1990, is the adjusted 
basis for federal income tax purposes, including any 
modification made in a taxable year under section 290.01, 
subdivision 19e, or Minnesota Statutes 1986, section 290.09, 
subdivision 7, paragraph (c). 
      (2) The alternative tax net operating loss deduction under 
sections 56(a)(4) and 56(d) of the Internal Revenue Code does 
not apply. 
    (3) The special rule for 100 percent certain dividends 
under section 56(g)(4)(C)(ii) of the Internal Revenue Code does 
not apply. 
      (4) The special rule for dividends from section 936 
companies under section 56(g)(4)(C)(iii) does not apply. 
     (5) The tax preference for depletion under section 57(a)(1) 
of the Internal Revenue Code does not apply. 
     (6) The tax preference for intangible drilling costs under 
section 57(a)(2) of the Internal Revenue Code must be calculated 
without regard to the subtraction under section 290.01, 
subdivision 19d, clause (4). 
     (7) The tax preference for tax exempt interest under 
section 57(a)(5) of the Internal Revenue Code does not apply.  
     (8) The tax preference for charitable contributions of 
appreciated property under section 57(a)(6) of the Internal 
Revenue Code does not apply. 
      (9) For purposes of calculating the tax preference for 
accelerated depreciation or amortization on certain property 
placed in service before January 1, 1987, under section 57(a)(7) 
of the Internal Revenue Code, the deduction allowable for the 
taxable year is the deduction allowed under section 290.01, 
subdivision 19e. 
     (10) For purposes of calculating the adjustment for 
adjusted current earnings in section 56(g) of the Internal 
Revenue Code, the term "alternative minimum taxable income" as 
it is used in section 56(g) of the Internal Revenue Code, means 
alternative minimum taxable income as defined in this 
subdivision, determined without regard to the adjustment for 
adjusted current earnings in section 56(g) of the Internal 
Revenue Code. 
    (11) For purposes of determining the amount of adjusted 
current earnings under section 56(g)(3) of the Internal Revenue 
Code, no adjustment shall be made under section 56(g)(4) of the 
Internal Revenue Code with respect to (i) the amount of foreign 
dividend gross-up subtracted as provided in section 290.01, 
subdivision 19d, clause (1), (ii) the amount of refunds of 
income, excise, or franchise taxes subtracted as provided in 
section 290.01, subdivision 19d, clause (10), or (iii) the 
amount of royalties, fees or other like income subtracted as 
provided in section 290.01, subdivision 19d, clause (11). 
    Items of tax preference must not be reduced below zero as a 
result of the modifications in this subdivision. 
    Sec. 10.  Minnesota Statutes Second 1989 Supplement, 
section 290.0921, is amended by adding a subdivision to read: 
    Subd. 3a.  [EXEMPTIONS.] The following entities are exempt 
from the tax imposed by this section: 
    (1) cooperatives taxable under subchapter T of the Internal 
Revenue Code or organized under chapter 308 or a similar law of 
another state; 
    (2) corporations subject to tax under section 60A.15, 
subdivision 1; 
    (3) real estate investment trusts; 
    (4) regulated investment companies or a fund thereof; and 
    (5) entities having a valid election in effect under 
section 860D(b) of the Internal Revenue Code of 1986, as amended 
through December 31, 1989. 
    Sec. 11.  Minnesota Statutes Second 1989 Supplement, 
section 290.0921, subdivision 8, is amended to read: 
    Subd. 8.  [CARRYOVER CREDIT.] (a) A corporation is allowed 
a credit against qualified regular tax for qualified alternative 
minimum tax previously paid.  The credit is allowable only if 
the corporation has no tax liability under this section for the 
taxable year and if the corporation has an alternative minimum 
tax credit carryover from a previous year.  The credit allowable 
in a taxable year equals the lesser of 
    (1) the excess of the qualified regular tax for the taxable 
year over the amount computed under subdivision 1, paragraph 
(a), clause (1), multiplied by the sum of one plus the surtax 
percentage under section 290.06, subdivision 1a, for the taxable 
year or 
    (2) the carryover credit to the taxable year. 
    (b) For purposes of this subdivision, the following terms 
have the meanings given. 
    (1) "Qualified alternative minimum tax" equals the amount 
determined under subdivision 1 for the taxable year multiplied 
by the sum of one plus the surtax percentage rate under section 
290.06, subdivision 1a.  In computing the amount of alternative 
minimum tax 
    (i) the adjustment under section 56(c)(3) of the Internal 
Revenue Code must not be made; 
    (ii) the full amount of the charitable contribution 
deduction under section 290.21, subdivision 3, must be deducted 
in computing Minnesota alternative minimum taxable income; and 
    (iii) in the case of a corporation subject to an occupation 
tax under section 298.01 the tax preference for depletion under 
section 57(a)(1) of the Internal Revenue Code must be deducted 
in computing Minnesota alternative minimum taxable income. 
    (2) "Qualified regular tax" means the tax imposed under 
section 290.06, subdivision 1, and a surtax imposed on that tax 
under section 290.06, subdivision 1a. 
    (c) The qualified alternative minimum tax for a taxable 
year is an alternative minimum tax credit carryover to each of 
the five taxable years succeeding the taxable year.  The entire 
amount of the credit must be carried to the earliest taxable 
year to which the amount may be carried.  Any unused portion of 
the credit must be carried to the following taxable year.  No 
credit may be carried to a taxable year in which alternative 
minimum tax was paid. 
    Sec. 12.  [290.0922] [MINIMUM FEE; CORPORATIONS.] 
    Subdivision 1.  [IMPOSITION.] (a) In addition to the tax 
imposed by this chapter without regard to this section, the 
franchise tax imposed on a corporation required to file under 
section 290.37, other than a corporation having a valid election 
in effect under section 1362 of the Internal Revenue Code of 
1986, as amended through December 31, 1989, for the taxable year 
includes a tax equal to the following amounts: 
     If the sum of the corporation's
Minnesota property, payrolls, and sales
or receipts is:                            the tax equals:
           less than $500,000                    $0
   $   500,000 to $ 1,000,000                  $100
   $ 1,000,000 to $ 4,999,999                  $300
   $ 5,000,000 to $ 9,999,999                $1,000 
   $10,000,000 to $19,999,999                $2,000 
   $20,000,000 or more                       $5,000 
    (b) A tax is imposed annually beginning in 1990 on a 
corporation required to file a return under section 290.41, 
subdivision 1, that has a valid election in effect for the 
taxable year under section 1362 of the Internal Revenue Code of 
1986, as amended through December 31, 1989, and on a partnership 
required to file a return under section 290.41, subdivision 1, 
other than a partnership that derives over 80 percent of its 
income from farming.  The tax imposed under this paragraph is 
due on or before the due date of the return due under section 
290.41, subdivision 1, for the calendar year following the 
calendar year in which the tax is imposed.  The commissioner 
shall prescribe the return to be used for payment of this tax. 
The tax under this paragraph is equal to the following amounts:  
     If the sum of the S corporation's or partnership's 
Minnesota property, payrolls, and sales
or receipts is:                        the tax equals:
             less than $500,000                $0 
     $   500,000 to $ 1,000,000              $100 
     $ 1,000,000 to $ 4,999,999              $300 
     $ 5,000,000 to $ 9,999,999            $1,000 
     $10,000,000 to $19,999,999            $2,000 
     $20,000,000 or more                   $5,000 
    Subd. 2.  [EXEMPTIONS.] The following entities are exempt 
from the tax imposed by this section: 
    (1) corporations exempt from tax under section 290.05 other 
than insurance companies exempt under subdivision 1, paragraph 
(d); 
    (2) real estate investment trusts; 
    (3) regulated investment companies or a fund thereof; and 
    (4) entities having a valid election in effect under 
section 860D(b) of the Internal Revenue Code of 1986, as amended 
through December 31, 1989; and 
    (5) town and farmers' mutual insurance companies. 
    Entities not specifically exempted by this subdivision are 
subject to tax under this section, notwithstanding section 
290.05.  
    Subd. 3.  [DEFINITION.] "Minnesota sales or receipts," 
"Minnesota property," and "Minnesota payrolls" have the meanings 
given in section 290.092, subdivision 4. 
    Sec. 13.  Minnesota Statutes 1988, section 290.31, 
subdivision 1, is amended to read: 
    Subdivision 1.  [PARTNERS, NOT PARTNERSHIP, SUBJECT TO 
TAX.] A partnership as such shall not be subject to the income 
tax imposed by this chapter, but is subject to the tax imposed 
under section 290.0922.  Persons carrying on business as 
partners shall be liable for income tax only in their separate 
or individual capacities. 
    Sec. 14.  Minnesota Statutes 1989 Supplement, section 
290.9201, is amended by adding a subdivision to read: 
    Subd. 11.  [EXCEPTION FROM WITHHOLDING FOR PUBLIC 
SPEAKERS.] The provisions of subdivisions 7 and 8 shall not be 
effective for compensation paid to nonresident public speakers 
before January 1, 1992, if the compensation paid to the speaker 
is less than $2,000 or is only a payment of the speaker's 
expenses. 
    Sec. 15.  Minnesota Statutes 1988, section 290.9725, is 
amended to read: 
    290.9725 [S CORPORATION.] 
    For purposes of this chapter, the term "S corporation" 
means any corporation having a valid election in effect for the 
taxable year under section 1362 of the Internal Revenue Code of 
1986, as amended through December 31, 1987.  An S corporation 
shall not be subject to the taxes imposed by this chapter, 
except the taxes imposed under sections 290.0922, 290.92, 
290.9727, 290.9728, and 290.9729. 
    Sec. 16.  [INSTRUCTION TO REVISOR.] 
    In the next edition of Minnesota Statutes, the revisor of 
statutes shall substitute the phrase "Internal Revenue Code of 
1986, as amended through December 31, 1989" for the words 
"Internal Revenue Code of 1986, as amended through December 31, 
1988" wherever it occurs in chapters 290, 290A, and 291 except 
for the use of the phrase in section 290.01, subdivision 19, and 
section 290.92, subdivision 1, paragraph (1).  
    Sec. 17.  [FEDERAL CHANGES.] 
    The changes made by sections 7841, 7304(a), 7817, 7110, 
7815, 7816, 7811(d) of the Omnibus Budget Reconciliation Act of 
1989, Public Law Number 101-239, and sections 202, 203, and 204 
of Public Law Number 101-140 that affect the computation of 
gross income as defined in Minnesota Statutes, section 290.01, 
subdivision 20, the credit for research and experimental 
expenditures as defined in Minnesota Statutes, section 290.068, 
subdivision 2, the credit for state death taxes allowable as 
defined in Minnesota Statutes, section 291.03, subdivision 1, 
and the federal alternative minimum taxable income as defined in 
Minnesota Statutes, section 290.091, subdivision 2, shall be in 
effect at the same time they become effective for federal income 
and estate tax purposes. 
    Sec. 18.  [SEVERABILITY; INSURANCE TAXATION.] 
    (a) If the provision of Minnesota Statutes, section 60A.15, 
subdivision 1, enacted in section 1, providing a reduced 
insurance premiums tax rate to mutual insurance companies is 
found by a final nonappealable order of a court of competent 
jurisdiction to be unconstitutional or to have an 
unconstitutional effect on the application of the insurance 
premiums tax to other insurance companies, the legislature 
intends that section 1 be invalid and the otherwise applicable 
insurance premiums tax rates apply. 
    (b) If the provision of Minnesota Statutes, section 290.05, 
subdivision 1, clause (d), enacted in section 3, exempting a 
mutual insurance company from taxation under the corporate 
franchise tax is found by a final nonappealable order of a court 
of competent jurisdiction to be unconstitutional or to have an 
unconstitutional effect on the application of the corporate 
franchise tax to other insurance companies, the legislature 
intends that the exemption enacted in section 3 be invalid and 
the corporate franchise tax apply. 
    Sec. 19.  [ESTIMATED TAXES; EXCEPTION.] 
    For taxable years beginning after December 31, 1989, but 
before January 1, 1991, the commissioner of revenue may not 
assess any additions to tax that are the result of a 
corporation's failure to make sufficient estimated tax payments 
due to the changes in this article. 
    Sec. 20.  [SMALL BUSINESS TAX STUDY.] 
    The department of revenue shall conduct a study of the 
state and local tax burden in relation to ability to pay for 
businesses with combined Minnesota property, payroll, and sales 
of less than $5,000,000 per year.  The study shall present the 
state and local tax burden, net of federal income tax 
considerations, for representative businesses of various sizes, 
legal structures, and levels of profitability.  The study shall 
relate tax burden to such measures of ability to pay as taxable 
income, economic income, assets, and sales.  The study shall be 
submitted to the chairpersons of the tax committee of the house 
of representatives and senate by December 1, 1990. 
    Sec. 21.  [REPEALER.] 
    Minnesota Statutes Second 1989 Supplement, section 290.06, 
subdivision 1a, is repealed. 
    Sec. 22.  [EFFECTIVE DATE.] 
    Section 1 is effective for premiums paid after December 31, 
1989.  The provisions of section 12 are effective for taxable 
years beginning after December 31, 1990 for insurance companies 
domiciled in a state that imposes retaliatory taxes, fines, 
deposits, penalties, licenses, or fees.  Section 14 is effective 
the day following final enactment.  The remainder of this 
article is effective for taxable years beginning after December 
31, 1989, except as otherwise provided. 

                               ARTICLE 3 

                             PROPERTY TAXES
    Section 1.  Minnesota Statutes 1989 Supplement, section 
103B.3369, subdivision 5, is amended to read: 
    Subd. 5.  [FINANCIAL ASSISTANCE.] The board may award 
grants to counties only to carry out water resource protection 
and management programs identified as priorities in 
comprehensive local water plans.  Grants may be used to employ 
persons and to obtain and use information necessary to: 
    (1) develop comprehensive local water plans under section 
110B.04 that have not received state funding for water resources 
planning as provided for in Laws 1987, chapter 404, section 30, 
subdivision 5, clause (a); and 
    (2) implement comprehensive local water plans.  
A base grant shall be awarded to a county that levies a tax at 
the rate established under section 275.50, subdivision 5, 
paragraph (z), in an amount equal to $37,500 less the amount 
raised by that levy.  If the amount necessary to implement the 
local water plan for the county is less than $37,500, the amount 
of the base grant shall be the amount that, when added to the 
levy amount, equals the amount required to implement the plan.  
    Sec. 2.  Minnesota Statutes 1989 Supplement, section 
103B.3369, subdivision 7, is amended to read: 
    Subd. 7.  [RULES.] The board shall adopt rules that:  
    (1) establish performance criteria for grant administration 
for local implementation of state delegated or mandated programs 
that recognize regional variations in program needs and 
priorities; 
    (2) recognize the unique nature of state delegated or 
mandated programs; 
    (3) specify that program activities contracted by a county 
to another local unit of government are eligible for 
funding; and 
    (4) require that grants from the board may not exceed the 
amount matched by participating local units of government; and 
    (5) specify a process for the board to establish a base 
level grant amount that all participating counties may be 
eligible to receive. 
    Sec. 3.  Minnesota Statutes 1989 Supplement, section 
124.10, subdivision 2, is amended to read: 
    Subd. 2.  The county auditor shall at the time of making 
the March and November tax settlements of each year apportion to 
the several districts the amount received from liquor licenses, 
fines, estrays, and other sources belonging to the general 
school fund.  The county auditor each year shall apportion to 
the school districts within the county the amount received from 
powerline taxes under section 273.42, liquor licenses, fines, 
estrays, and other sources belonging to the general fund.  The 
apportionment apportionments shall be made in proportion to each 
district's net tax capacity within the county in the prior 
year.  The apportionments shall be made and amounts distributed 
to the school districts at the times provided for the settlement 
and distribution of real and personal property taxes under 
sections 276.09, 276.11, and 276.111, except that all of the 
power line taxes apportioned to a school district from the 
county school fund shall be included in the first half 
distribution of property taxes to the school district.  No 
district shall receive any part of the money received from 
liquor licenses unless all sums paid for such licenses in such 
district are apportioned to the county school fund.  
    Sec. 4.  Minnesota Statutes 1988, section 124.195, 
subdivision 7, is amended to read: 
    Subd. 7.  [PAYMENTS TO SCHOOL NONOPERATING FUNDS.] Each 
fiscal year state general fund payments for a district 
nonoperating fund shall be made at 85 percent of the estimated 
entitlement during the fiscal year of the entitlement, unless a 
higher rate has been established according to section 121.904, 
subdivision 4d.  This amount shall be paid in 12 equal monthly 
installments.  The amount of the actual entitlement, after 
adjustment for actual data, minus the payments made during the 
fiscal year of the entitlement shall be paid prior to October 31 
of the following school year.  The commissioner may make advance 
payments of homestead and agricultural credit aid for a 
district's debt service fund earlier than would occur under the 
preceding schedule if the district submits evidence showing a 
serious cash flow problem in the fund.  The commissioner may 
make earlier payments during the year and, if necessary, 
increase the percent of the entitlement paid to reduce the cash 
flow problem. 
    Sec. 5.  [134.342] [ALLOCATION OF LEVY AUTHORITY.] 
    Subdivision 1.  [AUTHORITY.] A regional public library 
system board may adopt a written resolution to assume 
responsibility for the allocation of the regional library system 
levy authority throughout the region.  If adopted, the board 
shall furnish a list to the commissioners of revenue and 
education by July 1 of the levy year, containing the name of 
each member city, town, and county that will be participating in 
that regional system. 
    Subd. 2.  [DETERMINATION OF LEVY LIMITATION.] The levy 
limitation for a regional library system is equal to the sum of 
the total maximum amount allowable for operating regional 
library services for all member cities, towns, and counties 
within the region subject to the levy limitation under section 
275.50, subdivision 5, clause (o).  If a member city or town of 
a regional library system is not subject to the levy limitations 
under sections 275.50 to 275.56, the commissioner of revenue 
shall determine a levy limitation for the purposes of this 
section as if the member were subject to the provisions of 
section 275.50, subdivision 5, clause (o).  The commissioner of 
revenue shall determine the total maximum amount allowable for 
the regional library system and shall certify the total amount 
to the regional library board and to the commissioner of 
education by August 1 of the levy year. 
    Subd. 3.  [ALLOCATION OF AUTHORITY.] A regional public 
library system board that has resolved to allocate library levy 
authority among its member cities, towns, and counties shall 
allocate the amount, up to the total amount certified to the 
board by the commissioner of revenue, and shall notify each 
member city, town, and county by August 15 of the levy year of 
its respective share of the total library levy for the region.  
Each member city, town, or county located in the region shall 
levy the amount negotiated and agreed upon by the board and each 
member city, town, or county. 
    The board shall certify to the commissioners of revenue and 
education by September 1 of the levy year, the levy amount 
allocated to each member city, town, and county in the regional 
library system. 
    Subd. 4.  [NON-ALLOCATED REGIONAL LIBRARY LEVY LIMITATION.] 
A city, town, or county located within a regional library system 
that does not allocate library levy authority under subdivisions 
1 to 3 but is subject to the levy limitations under sections 
275.50 to 275.56, shall levy according to section 275.50, 
subdivision 5, clause (o), to pay the operating costs of a 
regional library system.  
    Sec. 6.  Minnesota Statutes 1988, section 169.86, 
subdivision 1, is amended to read: 
    Subdivision 1.  [APPLICATION FOR PERMIT.] The commissioner, 
with respect to highways under the commissioner's jurisdiction, 
and local authorities, with respect to highways under their 
jurisdiction, may, in their discretion, upon application in 
writing and good cause being shown therefor, issue a special 
permit, in writing, authorizing the applicant to move a vehicle 
or combination of vehicles of a size or weight of vehicle or 
load exceeding the maximum specified in this chapter, or 
otherwise not in conformity with the provisions of this chapter, 
upon any highway under the jurisdiction of the party granting 
such permit and for the maintenance of which such party is 
responsible. 
    Permits relating to over-width, over-length manufactured 
homes shall not be issued to persons other than manufactured 
home dealers or manufacturers for movement of new units owned by 
the manufactured home dealer or manufacturer, until the person 
has presented a statement from the county auditor and treasurer 
where the unit is presently located, stating that all personal 
and real property taxes have been paid.  Upon payment of the 
most recent single year delinquent personal property or current 
year taxes only, the county auditor or treasurer must issue a 
taxes paid statement to a manufactured home dealer or a 
financial institution desiring to relocate a manufactured home 
that has been repossessed.  This statement must be dated within 
30 days of the contemplated move.  The statement from the county 
auditor and treasurer where the unit is presently located, 
stating that all personal and real property taxes have been 
paid, may be made by telephone.  If the statement is obtained by 
telephone, the permit shall contain the date and time of the 
telephone call and the names of the persons in the auditor's 
office and treasurer's office who verified that all personal and 
real property taxes had been paid. 
    Sec. 7.  Minnesota Statutes Second 1989 Supplement, section 
272.02, subdivision 4, is amended to read: 
    Subd. 4.  [CONVERSION TO EXEMPT OR TAXABLE USES.] (a) Any 
property exempt from taxation on January 2 of any year which, 
due to sale or other reason, loses its exemption prior to 
December 20 of any year, shall be placed on the current 
assessment rolls for that year. 
    The valuation shall be determined with respect to its value 
on January 2 of such year.  The classification shall be based 
upon the use to which the property was put by the purchaser, or 
in the event the purchaser has not utilized the property by 
December 20, the intended use of the property, determined by the 
county assessor, based upon all relevant facts. 
    (b) Property subject to tax on January 2 that is acquired 
by a governmental entity, church, or educational institution 
before August 1 of the year is exempt for that assessment year 
if (1) the property is to be used for an exempt purpose under 
subdivision 1, clauses (1) to (7), and (2) the property is not 
subject to the filing requirement under section 272.025. 
    Sec. 8.  Minnesota Statutes Second 1989 Supplement, section 
273.064, is amended to read: 
    273.064 [EXAMINATION OF LOCAL ASSESSOR'S WORK; COMPLETION 
OF ASSESSMENTS.] 
    The county assessor shall examine the assessment appraisal 
records of each local assessor anytime after January 15 December 
1 of each year and shall immediately give notice in writing to 
the governing body of said district of any deficiencies in the 
assessment procedures with respect to the quantity of or quality 
of the work done as of that date and indicating corrective 
measures to be undertaken and effected by the local assessor not 
later than 30 days thereafter.  If, upon reexamination of such 
records at that time, the deficiencies noted in the written 
notice previously given have not been substantially corrected to 
the end that a timely and uniform assessment of all real 
property in the county will be attained, then the county 
assessor with the approval of the county board shall collect the 
necessary records from the local assessor and complete the 
assessment or employ others to complete the assessment.  When 
the county assessor has completed the assessments, the local 
assessor shall thereafter resume the assessment function within 
the district.  In this circumstance the cost of completing the 
assessment shall be charged against the assessment district 
involved.  The county auditor shall certify the costs thus 
incurred to the appropriate governing body not later than August 
1 and if unpaid as of September 1 of the assessment year, the 
county auditor shall levy a tax upon the taxable property of 
said assessment district sufficient to pay such costs.  The 
amount so collected shall be credited to the general revenue 
fund of the county.  
    Sec. 9.  Minnesota Statutes 1989 Supplement, section 
273.11, subdivision 1, is amended to read: 
    Subdivision 1.  [GENERALLY.] Except as provided in 
subdivisions 6, 8, and 9 or section 273.17, subdivision 1, all 
property shall be valued at its market value.  The market value 
as determined pursuant to this section shall be stated such that 
any amount under $100 is rounded up to $100 and any amount 
exceeding $100 shall be rounded to the nearest $100.  In 
estimating and determining such value, the assessor shall not 
adopt a lower or different standard of value because the same is 
to serve as a basis of taxation, nor shall the assessor adopt as 
a criterion of value the price for which such property would 
sell at a forced sale, or in the aggregate with all the property 
in the town or district; but the assessor shall value each 
article or description of property by itself, and at such sum or 
price as the assessor believes the same to be fairly worth in 
money.  The assessor shall take into account the effect on the 
market value of property of environmental factors in the 
vicinity of the property.  In assessing any tract or lot of real 
property, the value of the land, exclusive of structures and 
improvements, shall be determined, and also the value of all 
structures and improvements thereon, and the aggregate value of 
the property, including all structures and improvements, 
excluding the value of crops growing upon cultivated land.  In 
valuing real property upon which there is a mine or quarry, it 
shall be valued at such price as such property, including the 
mine or quarry, would sell for a fair, voluntary sale, for 
cash.  In valuing real property which is vacant, the fact that 
such property is platted shall not be taken into account.  An 
individual lot of such platted property shall not be assessed in 
excess of the assessment of the land as if it were unplatted 
until the lot is improved with a permanent improvement all or a 
portion of which is located upon the lot, or for a period of 
three years after final approval of said plat whichever is 
shorter.  When a lot is sold or construction begun, the net tax 
capacity of that lot or any single contiguous lot fronting on 
the same street shall be eligible for reassessment.  All 
property, or the use thereof, which is taxable under section 
272.01, subdivision 2, or 273.19, shall be valued at the market 
value of such property and not at the value of a leasehold 
estate in such property, or at some lesser value than its market 
value. 
    Sec. 10.  Minnesota Statutes 1989 Supplement, section 
273.112, subdivision 3, is amended to read: 
    Subd. 3.  Real estate shall be entitled to valuation and 
tax deferment under this section only if it is: 
    (a) actively and exclusively devoted to golf, skiing, or 
archery or firearms range recreational use or uses and other 
recreational uses carried on at the establishment; 
    (b) five acres in size or more, except in the case of an 
archery or firearms range; 
    (c)(1) operated by private individuals and open to the 
public; or 
    (2) operated by firms or corporations for the benefit of 
employees or guests; or 
    (3) operated by private clubs having a membership of 50 or 
more, provided that the club does not discriminate in membership 
requirements or selection on the basis of sex; and 
     (d) made available, in the case of real estate devoted to 
golf, for use without discrimination on the basis of sex during 
the time when the facility is open to use by the public or by 
members, except that use for golf may be restricted on the basis 
of sex no more frequently than one, or part of one, weekend each 
calendar month for each sex and no more than two, or part of 
two, weekdays each week for each sex.  
    If a golf club membership allows use of golf course 
facilities by more than one adult per membership, the use must 
be equally available to all adults entitled to use of the golf 
course under the membership, except that use may be restricted 
on the basis of sex as permitted in this section.  Memberships 
that permit play during restricted times may be allowed only if 
the restricted times apply to all adults using the membership.  
A golf club may not offer a membership or golfing privileges to 
a spouse of a member that provides greater or less access to the 
golf course than is provided to that person's spouse under the 
same or a separate membership in that club, except that the 
terms of a membership may provide that one spouse may have no 
right to use the golf course at any time while the other spouse 
may have either limited or unlimited access to the golf course.  
    A golf club may have or create an individual membership 
category which entitles a member for a reduced rate to play 
during restricted hours as established by the club.  The club 
must have on record a written request by the member for such 
membership.  
    A golf club that has food or beverage facilities or 
services must allow equal access to those facilities and 
services for both men and women members in all membership 
categories at all times.  Nothing in this paragraph shall be 
construed to require service or access to facilities to persons 
under the age of 21 years or require any act that would violate 
law or ordinance regarding sale, consumption, or regulation of 
alcoholic beverages. 
    For purposes of this subdivision and subdivision 7a, 
discrimination means a pattern or course of conduct and not 
linked to an isolated incident. 
    Sec. 11.  Minnesota Statutes 1989 Supplement, section 
273.119, subdivision 2, is amended to read: 
    Subd. 2.  [REIMBURSEMENT FOR LOST REVENUE.] The county may 
transfer money from the county conservation account created in 
section 40A.152 to the county revenue fund to reimburse the fund 
for the cost of the property tax credit.  The county auditor 
shall certify to the commissioner of revenue, as part of the 
abstracts of tax lists required to be filed with the 
commissioner under section 275.29, the amount of tax lost to the 
county from the property tax credit under subdivision 1 and the 
extent that the tax lost exceeds funds available in the county 
conservation account.  Any prior year adjustments must also be 
certified in the abstracts of tax lists.  The commissioner of 
revenue shall review the certifications to determine their 
accuracy.  The commissioner may make the changes in the 
certification that are considered necessary or return a 
certification to the county auditor for corrections.  The 
commissioner shall reimburse each taxing district, other than 
school districts, from the Minnesota conservation fund under 
section 40A.151 for the taxes lost in excess of the county 
account.  The payments must be made at the times time provided 
in section 477A.015 473H.10, subdivision 3, for payment of local 
government aid to taxing jurisdictions in the same proportion 
that the ad valorem tax is distributed.  
    Sec. 12.  Minnesota Statutes Second 1989 Supplement, 
section 273.123, subdivision 4, is amended to read: 
    Subd. 4.  [STATE REIMBURSEMENT.] The county auditor shall 
calculate the tax on the property described in subdivision 2 
based on the assessment made on January 2 of the year in which 
the disaster or emergency occurred.  The difference between the 
tax determined on the January 2 gross tax capacity and the tax 
actually payable based on the reassessed gross tax capacity 
determined under subdivision 2 shall be reimbursed to each 
taxing jurisdiction in which the damaged property is located.  
The amount shall be certified by the county auditor and reported 
to the commissioner of revenue.  The commissioner shall make the 
payments to the taxing jurisdictions, other than school 
districts, containing the property at the time distributions are 
made under section 477A.015 473H.10, subdivision 3, in the same 
proportion that the ad valorem tax is distributed.  
    Sec. 13.  Minnesota Statutes 1988, section 273.124, is 
amended by adding a subdivision to read: 
    Subd. 3a.  [MANUFACTURED HOME PARK COOPERATIVE.] When a 
manufactured home park is owned by a corporation or association 
organized under chapter 308A, and each person who owns a share 
or shares in the corporation or association is entitled to 
occupy a lot within the park, the corporation or association may 
claim homestead treatment for each lot occupied by a 
shareholder.  Each lot must be designated by legal description 
or number, and each lot is limited to not more than one-half 
acre of land for each homestead.  The manufactured home park 
shall be valued and assessed as if it were homestead property 
within class 1 if all of the following criteria are met: 
    (1) the occupant is using the property as a permanent 
residence; 
    (2) the occupant or the cooperative association is paying 
the ad valorem property taxes and any special assessments levied 
against the land and structure either directly, or indirectly 
through dues to the corporation; and 
    (3) the corporation or association organized under chapter 
308A is wholly owned by persons having a right to occupy a lot 
owned by the corporation or association.  
     A charitable corporation, organized under the laws of 
Minnesota with no outstanding stock, and granted a ruling by the 
Internal Revenue Service for 501(c)(3) tax-exempt status, 
qualifies for homestead treatment with respect to member 
residents of the manufactured home park who hold residential 
participation warrants entitling them to occupy a lot in the 
manufactured home park. 
    Sec. 14.  Minnesota Statutes 1988, section 273.124, is 
amended by adding a subdivision to read: 
    Subd. 15.  [RESIDENCE OF DISABLED CHILD OF OWNER.] The 
principal residence of an individual who has a permanent 
disability as defined in section 290A.03, subdivision 10, shall 
be classified as a homestead if the residence is wholly owned by 
a parent or both parents of the individual.  The application for 
homestead benefits must be on a form prescribed by the 
commissioner and must contain the information necessary for the 
assessor to determine whether homestead classification under 
this subdivision is warranted. 
    Sec. 15.  Minnesota Statutes 1988, section 273.124, is 
amended by adding a subdivision to read: 
    Subd. 16.  [HOMESTEAD ACQUIRED UNDER EMINENT DOMAIN.] If a 
home classified as a homestead under section 273.13, subdivision 
22, is acquired from the owner under eminent domain proceedings, 
a home purchased by the owner for use as a homestead within six 
months of the date of acquisition under eminent domain must be 
classified by the assessor as class 1 homestead property under 
section 273.13, subdivision 22, for taxes payable in the 
following year, notwithstanding the provisions of subdivision 
9.  The homeowner must apply to the assessor for classification 
under this subdivision within 30 days of the purchase of the 
home.  The homeowner must provide the assessor with the 
information necessary for the assessor to determine that the 
property qualifies for homestead under this subdivision.  The 
assessor may require the homeowner to submit an affidavit. 
    Sec. 16.  Minnesota Statutes Second 1989 Supplement, 
section 273.13, subdivision 22, is amended to read: 
    Subd. 22.  [CLASS 1.] (a) Except as provided in subdivision 
23, real estate which is residential and used for homestead 
purposes is class 1.  The market value of class 1a property must 
be determined based upon the value of the house, garage, and 
land.  
    The first $68,000 of market value of class 1a property has 
a net class rate of one percent of its market value and a gross 
class rate of 2.17 percent of its market value.  The market 
value of class 1a property that exceeds $68,000 but does not 
exceed $100,000 $110,000 has a class rate of two percent of its 
market value.  The market value of class 1a property that 
exceeds $100,000 $110,000 has a class rate of three percent of 
its market value.  
    (b) Class 1b property includes real estate or manufactured 
homes used for the purposes of a homestead by 
    (1) any blind person, if the blind person is the owner 
thereof or if the blind person and the blind person's spouse are 
the sole owners thereof; or 
    (2) any person, hereinafter referred to as "veteran," who: 
    (i) served in the active military or naval service of the 
United States; and 
    (ii) is entitled to compensation under the laws and 
regulations of the United States for permanent and total 
service-connected disability due to the loss, or loss of use, by 
reason of amputation, ankylosis, progressive muscular 
dystrophies, or paralysis, of both lower extremities, such as to 
preclude motion without the aid of braces, crutches, canes, or a 
wheelchair; and 
    (iii) with assistance by the administration of veterans 
affairs has acquired a special housing unit with special 
fixtures or movable facilities made necessary by the nature of 
the veteran's disability, or the surviving spouse of the 
deceased veteran for as long as the surviving spouse retains the 
special housing unit as a homestead; or 
      (3) any person who: 
      (i) is permanently and totally disabled and 
      (ii) receives 90 percent or more of total income from 
      (A) aid from any state as a result of that disability; or 
      (B) supplemental security income for the disabled; or 
      (C) workers' compensation based on a finding of total and 
permanent disability; or 
      (D) social security disability, including the amount of a 
disability insurance benefit which is converted to an old age 
insurance benefit and any subsequent cost of living increases; 
or 
      (E) aid under the Federal Railroad Retirement Act of 1937, 
United States Code Annotated, title 45, section 228b(a)5; or 
      (F) a pension from any local government retirement fund 
located in the state of Minnesota as a result of that 
disability; or 
     (iii) whose household income as defined in section 290A.03, 
subdivision 5, is 150 percent or less of the federal poverty 
level. 
     Property is classified and assessed pursuant to clause (1) 
only if the commissioner of jobs and training certifies to the 
assessor that the owner of the property satisfies the 
requirements of this subdivision.  
    Permanently and totally disabled for the purpose of this 
subdivision means a condition which is permanent in nature and 
totally incapacitates the person from working at an occupation 
which brings the person an income.  The first $32,000 market 
value of class 1b property has a net class rate of .4 .45 
percent of its market value and a gross class rate of .87 
percent of its market value.  The remaining market value of 
class 1b property has a gross or net class rate using the rates 
for class 1 or class 2a property, whichever is appropriate, of 
similar market value.  
    (c) Class 1c property is commercial use real property that 
abuts a lakeshore line and is devoted to temporary and seasonal 
residential occupancy for recreational purposes but not devoted 
to commercial purposes for more than 225 days in the year 
preceding the year of assessment, and that includes a portion 
used as a homestead by the owner, which includes a dwelling 
occupied as a homestead by a shareholder of a corporation that 
owns the resort or a partner in a partnership that owns the 
resort, even if the title to the homestead is held by the 
corporation or partnership.  For purposes of this clause, 
property is devoted to a commercial purpose on a specific day if 
any portion of the property, excluding the portion used 
exclusively as a homestead, is used or available for use for 
residential occupancy and a fee is charged for residential 
occupancy.  Class 1c property has a class rate of .4 percent of 
the first $32,000 of market value for taxes payable in 1990, .6 
percent of the first $32,000 of market value for taxes payable 
in 1991, .8 percent of the first $32,000 of market value for 
taxes payable in 1992, and one percent of market value in excess 
of $32,000 for taxes payable in 1990, 1991, and 1992, and one 
percent of total market value for taxes payable in 1993 and 
thereafter with the following limitation:  the area of the 
property must not exceed 100 feet of lakeshore footage for each 
cabin or campsite located on the property up to a total of 800 
feet and 500 feet in depth, measured away from the lakeshore.  
    Sec. 17.  Minnesota Statutes Second 1989 Supplement, 
section 273.13, subdivision 23, is amended to read:  
    Subd. 23.  [CLASS 2.] (a) Class 2a property is agricultural 
land including any improvements that is homesteaded.  The market 
value of the house and garage and immediately surrounding one 
acre of land has the same class rates as class 1a property under 
subdivision 22.  If the market value of the house, garage, and 
surrounding one acre of land is less than $100,000 $110,000, the 
value of the remaining land including improvements equal to the 
difference between $100,000 $110,000 and the market value of the 
house, garage, and surrounding one acre of land has a net class 
rate of .4 .45 percent of market value and a gross class rate of 
1.75 percent of market value.  The remaining value of class 2a 
property over $100,000 $110,000 of market value that does not 
exceed 320 acres has a net class rate of 1.3 percent of market 
value for taxes payable in 1990, 1.4 percent of market value for 
taxes payable in 1991, and 1.5 percent of market value for taxes 
payable in 1992 and thereafter, and a gross class rate of 2.25 
percent of market value.  The remaining property over the 
$100,000 $110,000 market value in excess of 320 acres has a 
class rate of 1.7 percent of market value for taxes payable in 
1990, and 1.6 percent of market value for taxes payable in 1991, 
and 1.5 percent of market value for taxes payable in 1992 and 
thereafter, and a gross tax capacity of 2.25 percent of market 
value.  
    (b) Class 2b property is (1) real estate, rural in 
character and used exclusively for growing trees for timber, 
lumber, and wood and wood products; and (2) real estate that is 
nonhomestead agricultural land.  Class 2b property has a net 
class rate of 1.7 percent of market value for taxes payable in 
1990, and 1.6 percent of market value for taxes payable in 1991, 
and 1.5 percent of market value for taxes payable in 1992 and 
thereafter, and a gross class rate of 2.25 percent of market 
value.  
    (c) Agricultural land as used in this section means 
contiguous acreage of ten acres or more, primarily used during 
the preceding year for agricultural purposes.  Agricultural use 
may include pasture, timber, waste, unusable wild land, and land 
included in federal farm programs.  "Agricultural purposes" as 
used in this section means the raising or cultivation of 
agricultural products, and includes the commercial boarding of 
horses if the commercial boarding of horses is done in 
conjunction with the raising or cultivation of agricultural 
products.  
    (d) Real estate of less than ten acres used principally for 
raising poultry, livestock, fruit, vegetables or other 
agricultural products, including the breeding of fish for sale 
and consumption if the fish breeding occurs on land zoned for 
agricultural use, shall be considered as agricultural land, if 
it is not used primarily for residential purposes.  The term 
"agricultural products" as used in the preceding sentence means 
any of the products identified in section 273.111, subdivision 
6, clause (2).  "Agricultural purposes" as used in this section 
means the raising or cultivation of agricultural products.  
    (e) If a parcel used for agricultural purposes is also used 
for commercial or industrial purposes, including but not limited 
to:  
    (1) wholesale and retail sales; 
    (2) processing of raw agricultural products or other goods; 
    (3) warehousing or storage of processed goods; and 
    (4) office facilities for the support of the activities 
enumerated in clauses (1), (2), and (3), 
the assessor shall classify the part of the parcel used for 
agricultural purposes as class 1b, 2a, or 2b, whichever is 
appropriate, and the remainder in the class appropriate to its 
use.  The grading, sorting, and packaging of raw agricultural 
products for first sale is considered an agricultural purpose.  
A greenhouse or other building where horticultural or nursery 
products are grown that is also used for the conduct of retail 
sales must be classified as agricultural if it is primarily used 
for the growing of horticultural or nursery products from seed, 
cuttings, or roots and occasionally as a showroom for the retail 
sale of those products.  Use of a greenhouse or building only 
for the display of already grown horticultural or nursery 
products does not qualify as an agricultural purpose.  
    The assessor shall determine and list separately on the 
records the market value of the homestead dwelling and the one 
acre of land on which that dwelling is located.  If any farm 
buildings or structures are located on this homesteaded acre of 
land, their market value shall not be included in this separate 
determination.  
    Sec. 18.  Minnesota Statutes Second 1989 Supplement, 
section 273.13, subdivision 24, is amended to read: 
    Subd. 24.  [CLASS 3.] (a) Commercial and industrial 
property and utility real and personal property, except class 5 
property as identified in subdivision 31, clause (1), is class 
3a.  It has a class rate of 3.3 percent of the first $100,000 of 
market value for taxes payable in 1990, 3.2 percent for taxes 
payable in 1991, 3.1 percent for taxes payable in 1992, and 
three percent for taxes payable in 1993 and thereafter, and 5.06 
percent of the market value over $100,000.  In the case of 
state-assessed commercial, industrial, and utility property 
owned by one person or entity, only one parcel has a reduced 
class rate on the first $100,000 of market value.  In the case 
of other commercial, industrial, and utility property owned by 
one person or entity, only one parcel in each county has a 
reduced class rate on the first $100,000 of market value. 
    (b) Employment property defined in section 469.166, during 
the period provided in section 469.170, shall constitute class 
3b and has a class rate of 2.4 2.3 percent of the first $50,000 
of market value and 3.6 percent of the remainder, except that 
for employment property located in a border city enterprise zone 
designated pursuant to section 469.168, subdivision 4, paragraph 
(c), the class rate of the first $100,000 of market value and 
the class rate of the remainder is determined under paragraph 
(a), unless the governing body of the city designated as an 
enterprise zone determines that a specific parcel shall be 
assessed pursuant to the first clause of this sentence.  The 
governing body may provide for assessment under the first clause 
of the preceding sentence only for property which is located in 
an area which has been designated by the governing body for the 
receipt of tax reductions authorized by section 469.171, 
subdivision 1. 
    Sec. 19.  Minnesota Statutes Second 1989 Supplement, 
section 273.13, subdivision 25, as amended by Laws 1990, chapter 
480, article 7, section 7, is amended to read: 
    Subd. 25.  [CLASS 4.] (a) Class 4a is residential real 
estate containing four or more units and used or held for use by 
the owner or by the tenants or lessees of the owner as a 
residence for rental periods of 30 days or more.  Class 4a also 
includes hospitals licensed under sections 144.50 to 144.56, 
other than hospitals exempt under section 272.02, and contiguous 
property used for hospital purposes, without regard to whether 
the property has been platted or subdivided.  Class 4a property 
has a class rate of 3.6 percent of market value. 
    (b) Class 4b includes: 
    (1) residential real estate containing less than four 
units, other than seasonal residential, and recreational; 
    (2) 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; 
    (3) manufactured homes not classified under any other 
provision; 
    (4) (3) a dwelling, garage, and surrounding one acre of 
property on a nonhomestead farm classified under subdivision 23, 
paragraph (b).  
    Class 4b property has a class rate of 3.0 percent of market 
value. 
    (c) Class 4c property includes: 
    (1) 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 rules 
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.  This 
clause applies only to property of a nonprofit or limited 
dividend entity.  Property is classified as class 4c under this 
clause for 15 years from the date of the completion of the 
original construction or substantial rehabilitation, or for the 
original term of the loan; 
    (2) a structure that is: 
    (i) 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 
    (ii) 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.  Property is classified as class 4c under 
this clause for the term of the housing assistance payments 
contract, including all renewals, or for the term of its 
permanent financing, whichever is shorter; and 
    (3) a qualified low-income building that (i) receives a 
low-income housing credit under section 42 of the Internal 
Revenue Code of 1986, as amended through December 31, 1988; or 
(ii) meets the requirements of that section.  Classification 
pursuant to this clause is limited to buildings the construction 
or rehabilitation of which began after May 1, 1988, and to a 
term of 15 years. 
    For all properties described in clauses (1), (2), and (3) 
and in paragraph (d), the market value determined by the 
assessor must be based on the normal approach to value using 
normal unrestricted rents.  The land on which these structures 
are situated has the class rate given in paragraph (b) if the 
structure contains fewer than four units, and the class rate 
given in paragraph (a) if the structure contains four or more 
units.  
    (4) 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.  This clause does not apply to any 
portion of the land or improvements used for nonresidential 
purposes.  For purposes of this clause, 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 clause, "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:  (a) it is a nonprofit corporation organized 
under chapter 317; (b) it has as its principal purpose providing 
housing for lower income families in a specific geographic 
community designated in its articles or bylaws; (c) it limits 
membership with voting rights to residents of the designated 
community; and (d) 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; 
and 
    (5) except as provided in subdivision 22, paragraph (c), 
real property devoted to temporary and seasonal residential 
occupancy for recreation purposes, including real property 
devoted to temporary and seasonal residential occupancy for 
recreation purposes and not devoted to commercial purposes for 
more than 225 days in the year preceding the year of 
assessment.  For this purpose purposes of this clause, property 
is devoted to a commercial use purpose on a specific day if it 
any portion of the property is used, or offered available for 
use for residential occupancy, and a fee is charged for the use 
residential occupancy.  Class 4c also includes commercial use 
real property used exclusively for recreational purposes in 
conjunction with class 4c property devoted to temporary and 
seasonal residential occupancy for recreational purposes, up to 
a total of two acres, provided the property is not devoted to 
commercial recreational use for more than 225 days in the year 
preceding the year of assessment and is located within two miles 
of the class 4c property with which it is used.  Class 4c 
property classified in this clause and clause (6) also includes 
the remainder of class 1c resorts; and 
    (6) real property up to a maximum of one acre of land owned 
by a nonprofit community service oriented organization; provided 
that the property is not used for a revenue-producing activity 
for more than six days in the calendar year preceding the year 
of assessment and the property is not used for residential 
purposes on either a temporary or permanent basis.  For purposes 
of this clause, a "nonprofit community service oriented 
organization" means any corporation, society, association, 
foundation, or institution organized and operated exclusively 
for charitable, religious, fraternal, civic, or educational 
purposes, and which is exempt from federal income taxation 
pursuant to section 501(c)(3), (10), or (19) of the Internal 
Revenue Code of 1986, as amended through December 31, 1988.  For 
purposes of this clause, "revenue-producing activities" shall 
include but not be limited to property or that portion of the 
property that is used as an on-sale intoxicating liquor or 
nonintoxicating malt liquor establishment licensed under chapter 
340A, a restaurant open to the public, bowling alley, a retail 
store, gambling conducted by organizations licensed under 
chapter 349, an insurance business, or office or other space 
leased or rented to a lessee who conducts a for-profit 
enterprise on the premises.  Any portion of the property which 
is used for revenue-producing activities for more than six days 
in the calendar year preceding the year of assessment shall be 
assessed as class 3a.  The use of the property for social events 
open exclusively to members and their guests for periods of less 
than 24 hours, when an admission is not charged nor any revenues 
are received by the organization shall not be considered a 
revenue-producing activity; and 
    (7) post-secondary student housing of not more than one 
acre of land that is owned by a nonprofit corporation organized 
under chapter 317 and is used exclusively by a student 
cooperative, sorority, or fraternity for on-campus housing or 
housing located within two miles of the border of a college 
campus; and 
     (8) manufactured home parks as defined in section 327.14, 
subdivision 3. 
    Class 4c property has a class rate of 2.4 2.3 percent of 
market value, except that manufactured home park property under 
clause (8) has a class rate of 3 percent of market value for 
taxes payable in 1991 and 2.3 percent of market value for taxes 
payable in 1992, and thereafter.  
    (d) Class 4d property includes any structure: 
    (i) 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; 
    (ii) located in a municipality of less than 10,000 
population; and 
    (iii) financed by a direct loan or insured loan from the 
farmers home administration.  Property is classified under this 
clause for 15 years from the date of the completion of the 
original construction or for the original term of the loan.  
    The class rates in paragraph (c), clauses (1), (2), and (3) 
and this clause apply to the properties described in them, 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.  Classification under this clause 
is only available to property of a nonprofit or limited dividend 
entity. 
    Class 4d property has a class rate of 1.7 percent of market 
value for taxes payable in 1990, and two percent of market value 
for taxes payable thereafter. 
    (e) Residential rental property that would otherwise be 
assessed as class 4 property under paragraph (a); paragraph (b), 
clauses (1) and (2); paragraph (c), clause (1), (2), (3), or 
(4), is assessed at the class rate applicable to it under 
Minnesota Statutes 1988, section 273.13, if it is found to be a 
substandard building under section 273.1316.  Residential rental 
property that would otherwise be assessed as class 4 property 
under paragraph (d) is assessed at 2.4 2.3 percent of market 
value if it is found to be a substandard building under section 
273.1316. 
    Sec. 20.  Minnesota Statutes Second 1989 Supplement, 
section 273.1398, subdivision 6, is amended to read: 
    Subd. 6.  [PAYMENT.] The commissioner shall certify the 
aids provided in subdivisions 2, 2b, 3, and 5 before December 1, 
1989, and October 1 thereafter of the year preceding the 
distribution year to the county auditor of the affected local 
government and pay them and the credit reimbursements to local 
governments other than school districts at the times provided in 
section 477A.015 for payment of local government aid to taxing 
jurisdictions.  The disparity reduction credit provided in 
subdivision 4 must be paid to taxing jurisdictions other than 
school districts at the time provided in section 473H.10, 
subdivision 3.  Aids and credit reimbursements to school 
districts must be certified to the commissioner of education and 
paid under section 273.1392.  Except for education districts and 
secondary cooperatives that receive revenue according to section 
124.2721 or 124.575, payment shall not be made to any taxing 
jurisdiction that has ceased to levy a property tax nor shall 
homestead and agricultural credit aid be payable on the part of 
a levy to which homestead and agricultural credit aid was 
separately allocated under subdivision 2, paragraph (b), clause 
(2), which is no longer levied. 
    Sec. 21.  Minnesota Statutes Second 1989 Supplement, 
section 273.371, subdivision 1, is amended to read: 
    Subdivision 1.  [REPORT REQUIRED.] Every electric light, 
power, gas, water, express, stage, and transportation company 
and pipeline doing business in Minnesota shall annually file 
with the commissioner on or before March 31 a report under oath 
setting forth the information prescribed by the commissioner to 
enable the commissioner to make valuations, recommended 
valuations, and equalization required under sections 273.33, 
273.35, 273.36, and 273.37.  If all the required information is 
not available on March 31, the company or pipeline shall file 
the information that is available on or before March 31, and the 
balance of the information as soon as it becomes available. 
    Sec. 22.  Minnesota Statutes 1988, section 273.42, 
subdivision 1, is amended to read:  
    Subdivision 1.  The property set forth in section 273.37, 
subdivision 2, consisting of transmission lines of less than 69 
kv and transmission lines of 69 kv and above located in an 
unorganized township, and distribution lines not taxed as 
provided in sections 273.38, 273.40 and 273.41 shall be taxed at 
the average tax capacity rate of taxes levied for all purposes 
throughout the county after disparity reduction aid is applied, 
and shall be entered on the tax lists by the county auditor 
against the owner thereof and certified to the county treasurer 
at the same time and in the same manner that other taxes are 
certified, and, when paid, shall be credited as follows:  50 
percent to the general revenue fund of the county and 50 percent 
to the general school fund of the county, except that if there 
are high voltage transmission lines as defined in section 
116C.52, the construction of which was commenced after July 1, 
1974 and which are located in unorganized townships within the 
county, then the distribution of taxes within this subdivision 
shall be credited as follows: 50 percent to the general revenue 
fund of the county, 40 percent to the general school fund of the 
county and ten percent to a utility property tax credit fund, 
which is hereby established. 
    Sec. 23.  Minnesota Statutes Second 1989 Supplement, 
section 275.065, subdivision 1, is amended to read: 
    Subdivision 1.  [PROPOSED LEVY.] Notwithstanding any law or 
charter to the contrary, on or before September 1, each taxing 
authority, other than a school district, shall adopt a proposed 
budget and each taxing authority shall certify to the county 
auditor the proposed or, in the case of a town, the final 
property tax levy for taxes payable in the following year.  If 
the board of estimate and taxation or any similar board that 
establishes maximum tax levies for taxing jurisdictions within a 
first class city certifies the maximum property tax levies for 
funds under its jurisdiction by charter to the county auditor by 
September 1, the city shall be deemed to have certified its 
levies for those taxing jurisdictions.  For purposes of this 
section, "taxing authority" includes all home rule and statutory 
cities, towns with a population over 5,000, counties, school 
districts, and special taxing districts.  The commissioner of 
revenue shall determine what constitutes a special taxing 
district for purposes of this section.  Intermediate school 
districts that levy a tax under chapter 136D, joint powers 
boards established under sections 124.491 to 124.496, and common 
school districts No. 323, Franconia, and No. 815, Prinsburg, are 
special taxing districts for purposes of this section.  
    Sec. 24.  Minnesota Statutes Second 1989 Supplement, 
section 275.065, subdivision 3, is amended to read: 
    Subd. 3.  [NOTICE OF PROPOSED PROPERTY TAXES.] (a) The 
county auditor shall prepare and the county treasurer shall 
deliver on or before November 10 each year, by first class mail 
to each taxpayer at the address listed on the county's current 
year's assessment roll, a notice of proposed property taxes and, 
in the case of a town, final property taxes.  
    (b) The commissioner of revenue shall prescribe the form of 
the notice. 
    (c) The notice must inform taxpayers that it contains the 
amount of property taxes each taxing authority other than a town 
proposes to collect for taxes payable the following year as 
required in paragraph (d) or (e) and, for a town, the amount of 
its final levy.  It must clearly state that each taxing 
authority, other than a town or special taxing district, will 
hold a public meeting to receive public testimony on the 
proposed budget and proposed or final property tax levy, or, in 
case of a school district, on the proposed property tax levy.  
It must clearly state the time and place of each taxing 
authority's meeting and an address where comments will be 
received by mail.  It must state the time and place for the 
continuation of the hearing if the hearing is not completed on 
the original date.  
    (d) Except as provided in paragraph (e), for taxes levied 
in 1990 and 1991, the notice must state by county, city or town, 
and school district:  
    (1) the total proposed or, for a town, final property tax 
levy for taxes payable the following year after reduction for 
state aid; 
    (2) the percentage increase or decrease from the actual 
property tax levy for taxes payable in the current year; and 
    (3) for counties, cities, and towns, the increase or 
decrease in population from the second previous calendar year to 
the immediately prior calendar year, as determined by the state 
demographer, and for school districts, the increase or decrease 
in the number of pupils in average daily membership from the 
second previous school year to the immediately prior school year 
as determined by the commissioner of education.  The data used 
to determine the increase or decrease in population under this 
clause must be the data used for purposes of the population 
adjustment to the levy limit base of the county, city, or town 
under section 275.51, subdivision 6. 
    For purposes of this paragraph, "proposed property taxes 
after reduction for state aid" means the taxing authority's levy 
certified under section 275.07, subdivision 1.  
    (e) In the case of a county containing a city of the first 
class, or taxing authority lying wholly within a county or 
counties containing a city of the first class, for taxes levied 
in 1991, and thereafter, and for all counties for taxes levied 
in 1992 and thereafter, the notice must state for each parcel: 
    (1) the market value of the property as defined under 
section 272.03, subdivision 8, for property taxes payable in the 
following year and for taxes payable the current year; 
    (2) by county, city or town, school district, the sum of 
the special taxing districts, and as a total of the taxing 
authorities, including special taxing districts, the proposed 
or, for a town, final net tax on the property for taxes payable 
the following year and the actual tax for taxes payable the 
current year; and 
    (3) the increase or decrease in the amounts in clause (2) 
from taxes payable in the current year to proposed or, for a 
town, final taxes payable the following year, expressed as a 
dollar amount and as a percentage. 
    (f) The notice must clearly state that the proposed or 
final taxes do not include the following: 
    (1) special assessments; 
    (2) levies approved by the voters after the date the 
proposed taxes are certified, including bond referenda, school 
district levy referenda, and levy limit increase referenda; 
    (3) amounts necessary to pay cleanup or other costs due to 
a natural disaster occurring after the date the proposed taxes 
are certified; and 
    (4) amounts necessary to pay tort judgments against the 
taxing authority that become final after the date the proposed 
taxes are certified. 
    Sec. 25.  Minnesota Statutes 1988, section 275.065, is 
amended by adding a subdivision to read: 
    Subd. 5a.  [PUBLIC ADVERTISEMENT.] (a) A city, county, or 
school district shall advertise in a newspaper a notice of its 
intent to adopt a budget and property tax levy or in the case of 
a school district, a property tax levy, at a public hearing.  
The notice must be published not less than two days nor more 
than six days before the hearing. 
    The advertisement must be at least one-eighth page in size 
of a standard-size or a tabloid-size newspaper, and the 
headlines in the advertisement stating the notice of proposed 
property taxes and the notice of public hearing must be in a 
type no smaller than 24-point.  The text of the advertisement 
must be no smaller than 18-point, except that the property tax 
amounts and percentages may be in 14-point type.  The 
advertisement must not be placed in the part of the newspaper 
where legal notices and classified advertisements appear.  The 
advertisement must be published in an official newspaper of 
general circulation in the taxing authority.  The newspaper 
selected must be one of general interest and readership in the 
community, and not one of limited subject matter.  The 
advertisement must appear in a newspaper that is published at 
least once per week.  
    (b) The advertisement must be in the following form, except 
that the notice for a school district must not include 
references to budget hearings or to adoption of a budget: 
"NOTICE OF
PROPOSED PROPERTY TAXES
(City/County/School District) of .........
The governing body of ........ will soon hold budget hearings 
and vote on the property taxes for (city/county services that 
will be provided in 199-/school district services that will be 
provided in 199- and 199-). 
The property tax amounts below compare current 
(city/county/school district) property taxes and the property 
taxes that would be collected in 199- if the budget now being 
considered is approved. 
199-                Proposed 199-       199- Increase
Property Taxes      Property Taxes      or Decrease

$........           $........              .....%

NOTICE OF PUBLIC HEARING:
All concerned citizens are invited to attend a public hearing 
and express their opinions on the proposed (city/county/school 
district) budget and property taxes.  The hearing will be held 
on (Month/Day/Year) at (Time) at (Location, Address). 
A continuation of the hearing, if necessary, will be held on 
(Month/Day/Year) at (Time) at (Location, Address). 
Written comments may be directed to (Address)." 
    Sec. 26.  Minnesota Statutes Second 1989 Supplement, 
section 275.065, subdivision 6, is amended to read: 
    Subd. 6.  [PUBLIC HEARING; ADOPTION OF BUDGET AND LEVY.] 
Between November 15 and December 20, the governing bodies of the 
city and county shall each hold a public hearing to adopt its 
final budget and property tax levy for taxes payable in the 
following year, and the governing body of the school district 
shall hold a public hearing to adopt its property tax levy for 
taxes payable in the following year.  
    At the hearing, the taxing authority, other than a school 
district, may amend the proposed budget and property tax levy 
and must adopt a final budget and property tax levy, and the 
school district may amend the proposed property tax levy and 
must adopt a final property tax levy.  
    The adopted property tax levy certified under section 
275.07 by a city, county, or school district must not exceed the 
proposed levy determined under subdivision 1, except by an 
amount up to the sum of the following amounts: 
    (1) the amount of a school district levy whose voters 
approved a referendum to increase taxes under section 124A.03, 
subdivision 2, or 124.82, subdivision 3, after the proposed levy 
was certified; 
    (2) the amount of a city or county levy approved by the 
voters under section 275.58 after the proposed levy was 
certified; 
    (3) the amount of a levy to pay principal and interest on 
bonds issued or approved by the voters under section 475.58 
after the proposed levy was certified; 
    (4) the amount of a levy to pay costs due to a natural 
disaster occurring after the proposed levy was certified, if 
that amount is approved by the commissioner of revenue under 
subdivision 6a; and 
    (5) the amount of a levy to pay tort judgments against a 
taxing authority that become final after the proposed levy was 
certified, if the amount is approved by the commissioner of 
revenue under subdivision 6a; and 
     (6) the amount of an increase in levy limits certified to 
the taxing authority by the commissioner of revenue or the 
commissioner of education after the proposed levy was certified. 
    At the hearing the percentage increase in property taxes 
proposed by the taxing authority, if any, and the specific 
purposes for which property tax revenues are being increased 
must be discussed.  During the discussion, the governing body 
shall hear comments regarding a proposed increase and explain 
the reasons for the proposed increase.  The public shall be 
allowed to speak and to ask questions prior to adoption of any 
measures by the governing body.  The governing body, other than 
the governing body school districts, shall adopt its final 
property tax levy prior to adopting its final budget. 
    The hearing must be held after 5:00 p.m. if scheduled on a 
day other than Saturday.  No hearing may be held on a Sunday.  
The commissioner of revenue county auditor shall provide for the 
coordination of hearing dates so that a taxing authority does 
not schedule public meetings on the days scheduled for the 
hearing by another taxing authority for all taxing authorities 
within the county. 
    By August 1, the county auditor shall notify the clerk of 
each school district within the county of the dates that the 
county board has designated for its hearing and any continuation 
under subdivision 3.  By August 15, each school board shall 
certify to the county auditors of the counties in which the 
school district is located the dates on which it elects to hold 
its hearings and any continuations under subdivision 3.  If a 
school board does not certify the dates by August 15, the 
auditor will assign the hearing date.  The dates elected or 
assigned must not conflict with the county hearing dates.  By 
August 20, the county auditor shall notify the clerks of the 
cities within the county of the dates on which the county and 
school districts have elected to hold their hearings.  At the 
time a city certifies its proposed levy under subdivision 1 it 
shall certify the dates on which it elects to hold its hearings 
and any continuations under subdivision 3.  The city must not 
select dates that conflict with those elected by or assigned to 
the counties and school districts in which the city is located.  
    The hearing dates so elected or assigned must be designated 
on the notices required under subdivision 3.  
    This subdivision does not apply to towns and special taxing 
districts.  
    Sec. 27.  Minnesota Statutes Second 1989 Supplement, 
section 275.07, subdivision 1, is amended to read: 
    Subdivision 1.  The taxes voted by cities, towns, counties, 
school districts, and special districts shall be certified by 
the proper authorities to the county auditor on or before five 
working days after December 20 in each year.  A town must 
certify the levy adopted by the town board to the county auditor 
by September 1 each year.  If the town board modifies the levy 
at a special town meeting after September 1, the town board must 
recertify its levy to the county auditor on or before five 
working days after December 20.  The taxes certified shall not 
be adjusted by the aid received under sections 273.1398, 
subdivisions 2 and 3, and 477A.013, subdivision 5.  If a city, 
town, county, school district, or special district fails to 
certify its levy by that date, its levy shall be the amount 
levied by it for the preceding year.  
    Sec. 28.  Minnesota Statutes Second 1989 Supplement, 
section 275.07, subdivision 3, is amended to read: 
    Subd. 3.  The county auditor shall adjust each local 
government's levy certified under subdivision 1, except for the 
equalization levies defined in section 273.1398, subdivision 2a, 
paragraph (a), by the amount of homestead and agricultural 
credit aid certified by section 273.1398, subdivision 2, reduced 
by the amount under section 273.1398, subdivision 5a, and 
equalization aid certified by section 477A.013, subdivision 5.  
If a local government's homestead and agricultural credit aid 
was further allocated between portions of its levy pursuant to 
section 273.1398, subdivision 2, paragraph (b)(2), the levy or 
fund to which the homestead and agricultural credit aid was 
allocated is the levy or fund which must be adjusted. 
    Sec. 29.  Minnesota Statutes 1988, section 275.125, 
subdivision 10, is amended to read: 
    Subd. 10.  [CERTIFICATION OF LEVY LIMITATIONS.] By August 
15, the commissioner shall notify the school districts of their 
levy limits.  The commissioner shall certify to the county 
auditors the levy limits for all school districts headquartered 
in the respective counties together with adjustments for errors 
in levies not penalized pursuant to subdivision 15 as well as 
adjustments to final pupil unit counts. 
    A school district shall have the right to may require the 
commissioner to review the certification and to present evidence 
in support of modification of the certification. 
    The county auditor shall reduce levies for any excess of 
levies over levy limitations pursuant to section 275.16. Such 
reduction in excess levies may, at the discretion of the school 
district, be spread over not to exceed two calendar years. 
    Sec. 30.  Minnesota Statutes Second 1989 Supplement, 
section 275.50, subdivision 5, is amended to read: 
    Subd. 5.  Notwithstanding any other law to the contrary for 
taxes levied in 1989 1990 payable in 1990 1991 and subsequent 
years, "special levies" means those portions of ad valorem taxes 
levied by governmental subdivisions to: 
    (a) for taxes levied in 1990, payable in 1991 and 
subsequent years, pay the costs not reimbursed by the state or 
federal government, of payments made to or on behalf of 
recipients of aid under any public assistance program authorized 
by law, and the costs of purchase or delivery of social 
services.  The aggregate amounts levied under this clause for 
the costs of purchase or delivery of social services and income 
maintenance programs, other than those identified in section 
273.1398, subdivision 1, paragraph (i), are subject to a maximum 
increase over the amount levied for the previous year of 12 
percent for counties within the metropolitan area as defined in 
section 473.121, subdivision 2, or counties outside the 
metropolitan area but containing a city of the first class, and 
15 percent for other counties.  For purposes of this clause, 
"income maintenance programs" include income maintenance 
programs in section 273.1398, subdivision 1, paragraph (i), to 
the extent the county provides benefits under those programs 
over the statutory mandated standards.  Effective with taxes 
levied in 1990, the portion of this special levy for human 
service programs identified in section 273.1398, subdivision 1, 
paragraph (i), is eliminated; 
     (b) pay the costs of principal and interest on bonded 
indebtedness except on bonded indebtedness issued under section 
471.981, subdivisions 4 to 4c, or to reimburse for the amount of 
liquor store revenues used to pay the principal and interest due 
in the year preceding the year for which the levy limit is 
calculated on municipal liquor store bonds; 
     (c) pay the costs of principal and interest on certificates 
of indebtedness, except tax anticipation or aid anticipation 
certificates of indebtedness, issued for any corporate purpose 
except current expenses or funding an insufficiency in receipts 
from taxes or other sources or funding extraordinary 
expenditures resulting from a public emergency; and to pay the 
cost for certificates of indebtedness issued pursuant to 
sections 298.28 and 298.282; 
     (d) fund the payments made to the Minnesota state armory 
building commission pursuant to section 193.145, subdivision 2, 
to retire the principal and interest on armory construction 
bonds; 
     (e) provide for the bonded indebtedness portion of payments 
made to another political subdivision of the state of Minnesota; 
     (f) pay the amounts required, in accordance with section 
275.075, to correct for a county auditor's error of omission but 
only to the extent that when added to the preceding year's levy 
it is not in excess of an applicable statutory, special law or 
charter limitation, or the limitation imposed on the 
governmental subdivision by sections 275.50 to 275.56 in the 
preceding levy year; 
     (g) pay amounts required to correct for an error of 
omission in the levy certified to the appropriate county auditor 
or auditors by the governing body of a city or town with 
statutory city powers in a levy year, but only to the extent 
that when added to the preceding year's levy it is not in excess 
of an applicable statutory, special law or charter limitation, 
or the limitation imposed on the governmental subdivision by 
sections 275.50 to 275.56 in the preceding levy year; 
     (h) pay amounts required by law to be paid to pay the 
interest on and to reduce the unfunded accrued liability of 
public pension funds in accordance with the actuarial standards 
and guidelines specified in sections 356.215 and 356.216 reduced 
by 106 percent of the amount levied for that purpose in 1976, 
payable in 1977.  For the purpose of this special levy, the 
estimated receipts expected from the state of Minnesota pursuant 
to sections 69.011 to 69.031 or any other state aid expressly 
intended for the support of public pension funds shall be 
considered as a deduction in determining the required levy for 
the normal costs of the public pension funds.  No amount of 
these aids shall be considered as a deduction in determining the 
governmental subdivision's required levy for the reduction of 
the unfunded accrued liability of public pension funds; 
     (i) to compensate the state for the cost of a reassessment 
ordered by the commissioner of revenue pursuant to section 
270.16; 
     (j) pay the debt service on tax increment financing revenue 
bonds to the extent that revenue to pay the bonds or to maintain 
reserves for the bonds is insufficient as a result of the 
provisions of Laws 1988, chapter 719, article 5; 
     (k) pay the cost of hospital care under section 261.21; 
     (l) pay the unreimbursed costs incurred in the previous 
year to satisfy judgments rendered against the governmental 
subdivision by a court of competent jurisdiction in any tort 
action, or to pay the costs of settlements out of court against 
the governmental subdivision in a tort action when substantiated 
by a stipulation for the dismissal of the action filed with the 
court of competent jurisdiction and signed by both the plaintiff 
and the legal representative of the governmental subdivision, 
provided that an appeal for the unreimbursed costs under this 
clause was approved by the commissioner of revenue under section 
275.51, subdivision 3; 
     (m) pay the expenses reasonably and necessarily incurred in 
preparing for or repairing the effects of natural disaster 
including the occurrence or threat of widespread or severe 
damage, injury, or loss of life or property resulting from 
natural causes such as earthquake, fire, flood, wind storm, wave 
action, oil spill, water contamination, air contamination, or 
drought in accordance with standards formulated by the emergency 
services division of the state department of public safety, 
provided that an appeal for the expenses incurred under this 
clause were approved by the commissioner of revenue under 
section 275.51, subdivision 3; 
     (n) pay a portion of the losses in tax receipts to a city 
due to tax abatements or court actions in the year preceding the 
current levy year, provided that an appeal for the tax losses 
was approved by the commissioner of revenue under section 
275.51, subdivision 3.  This special levy is limited to the 
amount of the losses times the ratio of the nonspecial levies to 
total levies for taxes payable in the year the abatements were 
granted.  County governments are not authorized to claim this 
special levy; 
     (o) pay the operating cost of regional library services 
authorized under section 134.34, subject to a maximum increase 
over the previous year of the greater of (1) 103 percent 
multiplied by one plus the percentage increase determined for 
the governmental subdivision under section 275.51, subdivision 
3h, clause (b), or (2) six percent.  If a governmental 
subdivision elected to include some or all of its levy for 
libraries within its adjusted levy limit base in the prior year, 
but elects to claim the levy as a special levy in the current 
levy year, the allowable increase is determined by applying the 
greater percentage determined under clause (1) or (2) to the 
total amount levied for libraries in the prior levy year.  After 
levy year 1989, the increase must not be determined using a base 
amount other than the amount that could have been levied as a 
special levy in the prior year.  This limit may be redistributed 
according to the provisions of section 134.342.  In no event 
shall the special levy be less than the minimum levy required 
under sections 134.33 and 134.34, subdivisions 1 and 2; 
    (p) pay the amount of the county building fund levy 
permitted under section 373.40, subdivision 6; 
    (q) pay the county's share of the costs levied in 1989, 
1990, and 1991 for the Minnesota cooperative soil survey under 
Minnesota Statutes 1988, section 40.07, subdivision 15; 
    (r) for taxes levied in 1989, payable in 1990 only, pay the 
cost incurred for the minimum share required by counties levying 
for the first time under section 134.34 as required under 
section 134.341.  For taxes levied in 1990, and thereafter, 
counties levying under this provision must levy under clause 
(o), and their allowable increase must be determined with 
reference to the amount levied in 1989 under this paragraph; 
    (s) for taxes levied in 1989, payable in 1990 only, provide 
an amount equal to 50 percent of the estimated amount of the 
reduction in aids to a county under sections 273.1398, 
subdivision 2, paragraph (d), and 477A.012, subdivision 3, for 
aids payable in 1990; 
    (t) for taxes levied in 1990 only by a county in the eighth 
judicial district, provide an amount equal to the amount of the 
levy, if any, that is required under Laws 1989, chapter 335, 
article 3, section 54, subdivision 8; 
    (u) for taxes levied in 1989, payable in 1990 only, pay the 
costs not reimbursed by the state or federal government: 
    (i) for the costs of purchase or delivery of social 
services.  The aggregate amounts levied under this item are 
subject to a maximum increase over the amount levied in the 
previous year of 12 percent for counties within the metropolitan 
area as defined in section 473.121, subdivision 2, or counties 
outside the metropolitan area but containing a city of the first 
class, and 15 percent for other counties. 
    (ii) for payments made to or on behalf of recipients of aid 
under any public assistance program authorized by law.  The 
aggregate amounts levied under this item are subject to a 
maximum increase over the amount levied in the previous year of 
12 percent and must be used only for the public assistance 
programs; and. 
    If the amount levied under this paragraph (u) in 1989 is 
less than the actual expenditures needed for these programs for 
1990, the difference between the actual expenditures and the 
amount levied may be levied in 1990 as a special levy.  If the 
amount levied in 1989 is greater than the actual expenditures 
needed for these programs for 1990, the difference between the 
amount levied and the actual expenditures shall be deducted from 
the 1990 levy limit, payable in 1991; 
    (v) pay an amount of up to 25 percent of the money sought 
for distribution and approved under section 115A.557, 
subdivision 3, paragraph (b), clause (3).; 
    (w) pay the unreimbursed costs of per diem jail or 
correctional facilities services paid by the county in the 
previous 12-month period ending on July 1 of the current year 
provided that the county is operating under a department of 
corrections directive that limits the capacity of a county jail 
as authorized in section 641.01 or 641.262, or a correctional 
facility as defined in section 241.021, subdivision 1, paragraph 
(5); 
    (x) for taxes levied in 1990 and 1991, payable in 1991 and 
1992 only, pay the operating or maintenance costs of a county 
jail as authorized in section 641.01 or 641.262, or of a 
correctional facility as defined in section 241.021, subdivision 
1, paragraph (5), to the extent that the county can demonstrate 
to the commissioner of revenue that the amount has been included 
in the county budget as a direct result of a rule, minimum 
requirement, minimum standard, or directive of the department of 
corrections.  If the county utilizes this special levy, any 
amount levied by the county in the previous levy year for the 
purposes specified under this clause and included in the 
county's previous year's levy limitation computed under section 
275.51, shall be deducted from the levy limit base under section 
275.51, subdivision 3f, when determining the county's current 
year levy limitation.  The county shall provide the necessary 
information to the commissioner of revenue for making this 
determination; 
    (y) for taxes levied in 1990, payable in 1991 only, pay an 
amount equal to the unreimbursed county costs paid in 1989 and 
1990 for the purpose of grasshopper control; and, for taxes 
levied in 1991 payable in 1992 only, pay an amount equal to the 
unreimbursed county costs paid in 1991 for the purpose of 
grasshopper control; 
    (z) for a county, provide an amount needed to fund 
comprehensive local water implementation activities under 
sections 103B.3361 to 103B.3369 as provided in this clause. 
    A county may levy an amount not to exceed the water 
implementation local tax rate times the adjusted net tax 
capacity of the county for the preceding year.  The water 
implementation local tax rate shall be set by August 1 each year 
by the commissioner of revenue for taxes payable in the 
following year.  As used in this paragraph, the "adjusted net 
tax capacity of the county" means the net tax capacity of the 
county as equalized by the commissioner of revenue based upon 
the results of an assessment/sales ratio study.  That rate shall 
be the rate, rounded up to the nearest one-thousandth of a 
percent, that, when applied to the adjusted net tax capacity for 
all counties, raises the amount specified in this clause.  The 
water implementation local tax rate for taxes levied in 1990 
shall be the rate that raises $1,500,000 and the rate for taxes 
levied in 1991 shall be the rate that raises $1,500,000.  A 
county must levy a tax at the rate established under this clause 
to qualify for a grant from the board of water and soil 
resources under section 103B.3369, subdivision 5; 
    (aa) pay the unreimbursed county costs for court-ordered 
family-based services and court-ordered out-of-home placement 
for children to the extent that the county can demonstrate to 
the commissioner of revenue that the estimated amount included 
in the county's budget for the following levy year is for the 
purposes specified under this clause.  For purposes of this 
special levy, costs for "family-based services" and "out-of-home 
placement" means costs resulting from court-ordered targeted 
family services designed to avoid out-of-home placement and from 
court-ordered out-of-home placement under the provisions of 
sections 260.172 and 260.191, which are unreimbursed by the 
state or federal government, insurance proceeds, or parental or 
child obligations.  Any amount levied under this clause must 
only be used by the county for the purposes specified in this 
clause.  
    If the county uses this special levy and the county levied 
an amount in the previous levy year, for the purposes specified 
under this clause, under another special levy or under the levy 
limitation in section 275.51, the following adjustments must be 
made: 
    (i) The amount levied in the previous levy year for the 
purposes specified under this clause under the levy limitation 
in section 275.51 must be deducted from the levy limit base 
under section 275.51, subdivision 3f when determining the 
current year levy limitation. 
    (ii) The amount levied in the previous levy year, for the 
purposes specified under clause (a) or clause (u) must be 
deducted from the previous year's amount used to calculate the 
maximum amount allowable under clause (a) in the current levy 
year; and 
    (bb) pay the amounts allowed as special levies under Laws 
1989, First Special Session chapter 1, article 5, section 50, 
and this act. 
    If the amount levied in 1989 is less than the actual 
expenditures needed for these programs for 1990, the difference 
between the actual expenditures and the amount levied may be 
levied in 1990 as a special levy.  If the amount levied in 1989 
is greater than the actual expenditures needed for these 
programs for 1990, the difference between the amount levied and 
the actual expenditures shall be deducted from the 1990 levy 
limit, payable in 1991.  
    Sec. 31.  Minnesota Statutes Second 1989 Supplement, 
section 275.51, subdivision 3h, is amended to read: 
    Subd. 3h.  [ADJUSTED LEVY LIMIT BASE.] For taxes levied in 
1989 and thereafter, the adjusted levy limit base is equal to 
the levy limit base computed pursuant to subdivision 3f, 
increased by:  
    (a) three percent for taxes levied in 1989 and subsequent 
years; 
    (b) a percentage equal to (1) one-half of the greater of 
the percentage increases in population or in number of 
households, if any, for cities and towns and (2) the lesser of 
the percentage increase in population or the number of 
households, if any, for counties, using figures derived pursuant 
to subdivision 6; 
     (c) the amount of a permanent increase in the levy limit 
base approved at a general or special election held during the 
12-month period ending September 30 of the levy year under 
section 275.58, subdivisions 1 and 2; 
     (d) for levy year 1989, for a county which incurred costs 
since October 1978, for the litigation of federal land claims 
under United States Code, title 18, section 1162; United States 
Code, title 25, section 331; and United States Code, title 28, 
section 1360; an amount of up to the actual costs incurred by 
the county for this purpose.  This adjustment shall not exceed 
$250,000; 
     (e) for levy year 1989, an amount of $1,724,000 for Ramsey 
county for implementing the local government pay equity act 
under sections 471.991 to 471.999.  Furthermore, in levy years 
1990 and 1991, an additional amount of $862,000 shall be added 
to Ramsey county's adjusted levy limit base under this clause 
for each of the two years; and 
    (f) for levy year 1989, an amount equal to the decrease in 
a county's 50 percent share of the powerline taxes extended 
between taxes payable years 1988 and 1989 under section 273.42, 
subdivision 1.  The adjustment shall be determined by the 
department of revenue. 
    For taxes levied in 1989, the adjusted levy limit base is 
reduced by an amount equal to the estimated amount of the 
reduction in aids to a county under sections 273.1398, 
subdivision 2, paragraph (d), and 477A.012, subdivision 3, for 
aids payable in 1990. 
    For taxes levied in 1990, the adjusted levy limit base of a 
city is reduced by an amount equal to the percent of the city's 
revenue base used in determining aid reductions under section 
477A.013, subdivision 7.  For taxes levied in 1990, the adjusted 
levy limit base of a county is reduced by one-half of the amount 
equal to the percent of the county's revenue base used in 
determining aid reductions under section 477A.012, subdivision 5.
    Sec. 32.  Minnesota Statutes Second 1989 Supplement, 
section 275.51, subdivision 4, is amended to read: 
    Subd. 4.  If the levy made by a governmental subdivision 
exceeds the limitation provided in sections 275.50 to 275.56, 
except when such excess levy is due to the rounding of the tax 
capacity rates of the governmental subdivision in accordance 
with section 275.28, subsequent distributions required to be 
made by the commissioner of finance from any formula aids 
pursuant to sections 477A.011 to 477A.014, or homestead and 
agricultural credit aid under section 273.1398, or taconite aids 
under sections 298.28 and 298.282 shall be reduced 33 cents for 
each full dollar the levy exceeds the limitation.  If a penalty 
under this subdivision or section 275.55, subdivision 1, is 
assessed against taconite aids, then the amount of the penalty 
must be distributed as provided in section 298.28, subdivision 
11, paragraph (a).  
    Sec. 33.  Minnesota Statutes 1988, section 275.55, is 
amended to read: 
    275.55 [STATE REVIEW AND REGULATION OF LEVIES.] 
    Subdivision 1.  [REVIEW; PENALTIES FOR VIOLATIONS.] The 
commissioner of revenue, or designees, shall establish 
procedures by which levies of all governmental units shall be 
periodically reviewed.  The commissioner shall be empowered to 
order withholding of state aids where such penalties are 
authorized by law, to issue, in accordance with chapter 14, 
rulings interpreting sections 275.50 to 275.56, and to take such 
other administrative actions as the commissioner deems necessary 
in order to carry out the provisions of sections 275.50 to 
275.56.  If the commissioner of revenue takes administrative 
action or any other action authorized by this section to enforce 
the provisions of sections 275.50 to 275.56, the commissioner 
shall give written notice of such action to the governmental 
subdivision affected.  Such notice shall specify the actual or 
impending violations by the governmental subdivision of sections 
275.50 to 275.56 or the rules of the department of revenue 
pertaining thereto, describe the corrective action required, 
including, in the case of an excess levy, reduction of the 
governmental subdivision's levy in the next succeeding levy year 
in an amount equal to the amount of the excess levy, set a 
reasonable period of time within which the governmental 
subdivision shall correct the specified actual or impending 
violations and caution the governmental subdivision that if the 
specified correction is not made within the time allowed, the 
state aids to the governmental subdivision pursuant to sections 
477A.011 to 477A.014, or homestead and agricultural credit aid 
pursuant to section 273.1398, or taconite aids pursuant to 
sections 298.28 and 298.282, as amended, will be reduced as 
provided in section 275.51, subdivision 4.  The time period 
first allowed for correction may be extended by the commissioner 
if there is a reasonable basis for delay.  County auditors, in 
addition to duties otherwise provided by law, shall cooperate 
with the commissioner in establishing such procedures and 
enforcing the provisions of sections 275.50 to 275.56.  
    Subd. 2.  [EXCESS LEVIES FOR 1992.] Notwithstanding the 
provisions of subdivision 1, for a home rule charter city, 
statutory city, or town that exceeds its payable 1992 levy 
limitation determined under section 275.51, a penalty shall be 
imposed consisting of a reduction in state aids payable to the 
city or town in 1992.  Notwithstanding the provisions of 
subdivision 1, for a county that exceeds its payable 1992 levy 
limitation determined under section 275.51, a penalty shall be 
imposed consisting of a reduction in state aids payable to the 
county in 1992.  The amount of the penalty imposed on the 
county, city, or town and the state aids affected shall be as 
determined under section 275.51, subdivision 4. 
    Sec. 34.  Minnesota Statutes Second 1989 Supplement, 
section 276.04, subdivision 2, is amended to read: 
    Subd. 2.  [CONTENTS OF TAX STATEMENTS.] (a) The treasurer 
shall provide for the printing of the tax statements.  The 
commissioner of revenue shall prescribe the form of the property 
tax statement and its contents.  The statement must contain a 
tabulated statement of the dollar amount due to each taxing 
authority from the parcel of real property for which a 
particular tax statement is prepared.  The dollar amounts due 
the county, township or municipality and school district must be 
separately stated.  The amounts due other taxing districts, if 
any, may be aggregated.  The dollar amounts, including the 
dollar amount of any special assessments, may be rounded to the 
nearest even whole dollar.  For purposes of this section whole 
odd-numbered dollars may be adjusted to the next higher 
even-numbered dollar.  The statement shall include the following 
sentence, printed in upper case letters in boldface print:  "THE 
STATE OF MINNESOTA DOES NOT RECEIVE ANY PROPERTY TAX REVENUES.  
THE STATE OF MINNESOTA REDUCES YOUR PROPERTY TAX BY PAYING 
CREDITS AND REIMBURSEMENTS TO LOCAL UNITS OF GOVERNMENT."  
    (b) The property tax statements for manufactured homes and 
sectional structures taxed as personal property shall contain 
the same information that is required on the tax statements for 
real property.  
    (c) Real and personal property tax statements must contain 
the following information in the order given in this paragraph.  
The information must contain the current year tax information in 
the right column with the corresponding information for the 
previous year in a column on the left: 
    (1) the property's estimated market value as defined in 
section 272.03, subdivision 8; 
    (2) the property's gross tax, calculated by multiplying the 
property's gross tax capacity times the total tax capacity rate 
and adding to the result the sum of the aids enumerated in 
clause (3); 
    (3) a total of the following aids: 
    (i) education aids payable under chapters 124 and 124A; 
    (ii) local government aids for cities, towns, and counties 
under chapter 477A; and 
    (iii) disparity reduction aid under section 273.1398; 
    (4) for homestead residential and agricultural properties, 
the homestead and agricultural credit aid apportioned to the 
property.  This amount is obtained by multiplying the total tax 
capacity rate by the difference between the property's gross and 
net tax capacities under section 273.13.  This amount must be 
separately stated and identified as "homestead and agricultural 
credit."  For purposes of comparison with the previous year's 
amount for the statement for taxes payable in 1990, the 
statement must show the homestead credit for taxes payable in 
1989 under section 273.13, and the agricultural credit under 
section 273.132 for taxes payable in 1989; 
    (5) any credits received under sections 273.119; 273.123; 
273.135; 273.1391; 273.1398, subdivision 4; 469.171; and 
473H.10; and 
    (6) the net tax payable in the manner required in paragraph 
(a). 
    The commissioner of revenue shall certify to the county 
auditor the actual or estimated aids enumerated in clauses (3) 
and (4) that local governments will receive in the following 
year.  In the case of a county containing a city of the first 
class, or a county that has adopted the provisions of Laws 1989, 
First Special Session chapter 1, article 9, section 81, for 
taxes levied in 1991, and for all counties for taxes levied in 
1992 and thereafter, the commissioner must certify this amount 
by September 1.  
    (d) For taxes payable in 1990, the commissioner shall 
prescribe language notifying taxpayers that state aid dollars 
were transferred from the city or town to the school district.  
The language must notify taxpayers that the transfer results in 
an increase in city or town taxes and a decrease in school taxes 
that is unrelated to spending decisions of the city or town and 
school district.  The commissioner may prescribe that the amount 
of the transfer be stated.  The commissioner may provide that 
the statement required under this clause be included as a 
separate enclosure. 
    Sec. 35.  Minnesota Statutes 1989 Supplement, section 
278.05, subdivision 4, is amended to read: 
    Subd. 4.  [SALES RATIO STUDIES AS EVIDENCE.] The sales 
ratio studies published by the department of revenue, or any 
part of the studies, or any copy of the studies or records 
accumulated to prepare the studies which is prepared by the 
commissioner of revenue for use in determining education aids 
shall be admissible in evidence as a public record without the 
laying of a foundation if the sales prices used in the study are 
adjusted for the terms of the sale to reflect market value and 
are adjusted to reflect the difference in the date of sale 
compared to the assessment date.  The department of revenue 
sales ratio study shall be prima facie evidence of the level of 
assessment.  Additional evidence relevant to the sales ratio 
study is also admissible.  No sales ratio study received into 
evidence shall be conclusive or binding on the court and 
evidence of its reliability or unreliability may be introduced 
by any party including, but not limited to, evidence of 
inadequate adjustment of sale prices for terms of financing, 
inadequate adjustment of sales prices to reflect the difference 
in the date of sale compared to the assessment date, and 
inadequate sample size.  
    No reduction in value on the grounds of discrimination 
shall be granted on the basis of a sales ratio study unless 
    (a) the sales prices are adjusted for the terms of the sale 
to reflect market value, 
    (b) the sales prices are adjusted to reflect the difference 
in the date of sale compared to the assessment date, 
    (c) there is an adequate sample size, and 
    (d) the median ratio of the same classification of property 
in the same county, city, or town as the subject property is 
lower than 90 percent, except that in the case of a county 
containing a city of the first class, the median ratio for the 
county shall be the ratio determined excluding sales from the 
first class city within the county.  
    If a reduction in value on the grounds of discrimination is 
granted based on the above criteria, the reduction shall equal 
the difference between 90 percent (1) the ratio for the 
petitioner's property less five percentage points and (2) the 
median ratio determined by the court.  In order to receive 
relief on the basis of discrimination, the petitioner must 
establish the ratio of the assessor's estimated market value to 
the actual fair market value for the property. 
    Sec. 36.  Minnesota Statutes 1988, section 281.17, is 
amended to read: 
    281.17 [PERIOD FOR REDEMPTION.] 
    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 25, paragraph (d)(1) or (c)(4), 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 homesteaded lands as defined 
in section 273.13, subdivision 22, located in a targeted 
neighborhood as defined in Laws 1987, chapter 386, article 6, 
section 4, and sold to the state at a tax judgment sale is 
two three years from the date of sale.  The period of redemption 
for other all lands located in a targeted neighborhood as 
defined in Laws 1987, chapter 386, article 6, section 4, except 
homesteaded lands as defined in section 273.13, subdivision 22, 
and sold to the state at a tax judgment sale is one year from 
the date of sale. 
    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. 
    Sec. 37.  Minnesota Statutes 1989 Supplement, section 
282.01, subdivision 1, is amended to read:  
    Subdivision 1.  [CLASSIFICATION; USE; EXCHANGE.] It is the 
general policy of this state to encourage the best use of 
tax-forfeited lands, recognizing that some lands in public 
ownership should be retained and managed for public benefits 
while other lands should be returned to private ownership.  All 
Parcels of land becoming the property of the state in trust 
under the provisions of any law now existing or hereafter 
enacted declaring the forfeiture of lands to the state for 
taxes, shall be classified by the county board of the county 
wherein such in which the parcels lie as conservation or 
nonconservation.  Such In making the classification shall be 
made with consideration, among other things, to the board shall 
consider the present use of adjacent lands, the productivity of 
the soil, the character of forest or other growth, accessibility 
of lands to established roads, schools, and other public 
services, their peculiar suitability or desirability for 
particular uses and the suitability of the forest resources on 
the land for multiple use, sustained yield management.  Such The 
classification, furthermore, shall aid:  to must encourage and 
foster a mode of land utilization that will facilitate the 
economical and adequate provision of transportation, roads, 
water supply, drainage, sanitation, education, and recreation; 
to facilitate reduction of governmental expenditures; to 
conserve and develop the natural resources; and to foster and 
develop agriculture and other industries in the districts and 
places best suited thereto to them. 
    In making such the classification the county board may make 
use of such data and information as may be made available by any 
office or department of the federal, state, or local 
governments, or by any other person or agency 
possessing pertinent information pertinent thereto at the time 
such the classification is made.  Such The lands may be 
reclassified from time to time as the county board may deem 
consider necessary or desirable, except as to for conservation 
lands held by the state free from any trust in favor of any 
taxing district.  
    If any such the lands are located within the boundaries 
of any an organized town, with taxable valuation in excess of 
$20,000, or incorporated municipality, the classification or 
reclassification and sale shall must first be approved by the 
town board of such the town or the governing body of such the 
municipality insofar as in which the lands are located therein 
are concerned.  The town board of the town or the governing body 
of the municipality will be deemed is considered to have 
approved the classification or reclassification and sale if the 
county board is not notified of the disapproval of the 
classification or reclassification and sale within 90 days of 
the date the request for approval was transmitted to the town 
board of the town or governing body of the municipality.  If the 
town board or governing body desires to acquire any parcel lying 
in the town or municipality by procedures authorized in this 
subdivision, it shall, within 90 days of the request for 
classification or reclassification and sale, must file a written 
application with the county board to withhold the parcel from 
public sale.  The application must be filed within 90 days of 
the request for classification or reclassification and sale.  
The county board shall then withhold the parcel from public sale 
for one year.  
    Subd. 1a.  [CONVEYANCE; GENERALLY.] Any Tax-forfeited lands 
may be sold by the county board to any an organized or 
incorporated governmental subdivision of the state for any 
public purpose for which such the subdivision is authorized to 
acquire property or may be released from the trust in favor of 
the taxing districts upon on application of any a state agency 
for any an authorized use at not less than their value as 
determined by the county board.  The commissioner of revenue may 
convey by deed in the name of the state any a tract of 
tax-forfeited land held in trust in favor of the taxing 
districts, to any a governmental subdivision for any an 
authorized public use, provided that if an application is 
submitted to the commissioner with which includes a statement of 
facts as to the use to be made of the tract and the need 
therefor and the recommendation of the county board.  
    Subd. 1b.  [CONVEYANCE; TARGETED NEIGHBORHOOD LANDS.] (a) 
Notwithstanding subdivision 1a, in the case of tax-forfeited 
lands located in a targeted neighborhood, as defined in section 
469.201, subdivision 10, outside the metropolitan area, as 
defined in section 473.121, subdivision 2, the commissioner of 
revenue shall may convey by deed in the name of the state any 
tract of tax-forfeited land held in trust in favor of the taxing 
districts, to a political subdivision that submits an 
application to the commissioner of revenue and the 
recommendation of the county board. 
    (b) Notwithstanding subdivision 1a, in the case of 
tax-forfeited lands located in a targeted neighborhood, as 
defined in section 469.201, subdivision 10, in a county in the 
metropolitan area, as defined in section 473.121, subdivision 2, 
the commissioner of revenue shall convey by deed in the name of 
the state any tract of tax-forfeited land held in trust in favor 
of the taxing districts, to a political subdivision that submits 
an application to the commissioner of revenue and the county 
board. 
    (c) The application under paragraph (a) or (b) must include 
a statement of facts as to the use to be made of the tract, the 
need therefor, and a resolution, adopted by the governing body 
of the political subdivision, finding that the conveyance of a 
tract of tax-forfeited land to the political subdivision is 
necessary to provide for the redevelopment of land as productive 
taxable property.  
     Subd. 1c.  [DEED OF CONVEYANCE.] The deed of 
conveyance shall must be upon on a form approved by the attorney 
general and shall must be conditioned upon on continued use for 
the purpose stated in the application, provided, however, that.  
If, however, the governing body of such the governmental 
subdivision by resolution determines that some other public use 
shall should be made of such the lands, and such the change 
of use is approved by the county board and an application 
for such change of use is made to, and approved by, the 
commissioner, such the changed use may be made of such lands 
without the necessity of the governing body conveying the lands 
back to the state and securing a new conveyance from the state 
to the governmental subdivision for such the new public use. 
    Subd. 1d.  [FAILURE TO USE; CONVEYANCE TO STATE.] Whenever 
any When a governmental subdivision to which any tax-forfeited 
land has been conveyed for a specified public use as provided in 
this section shall fail fails to put such the land to such 
that use, or to some other authorized public use as 
provided herein in this section, or shall abandon such abandons 
that use, the governing body of the subdivision shall authorize 
the proper officers to convey the same land, or such portion 
thereof the part of the land not required for an authorized 
public use, to the state of Minnesota, and such.  The officers 
shall execute a deed of such conveyance forthwith, which 
immediately.  The conveyance shall be is subject to the approval 
of the commissioner and in its form must be approved by the 
attorney general, provided, however, that.  A sale, lease, 
transfer, or other conveyance of such tax-forfeited lands by a 
housing and redevelopment authority, a port authority, an 
economic development authority, or a city as authorized by 
chapter 469 shall not be is not an abandonment of such use and 
such the lands shall not be reconveyed to the state nor shall 
they revert to the state.  A certificate made by a housing and 
redevelopment authority, a port authority, an economic 
development authority, or a city referring to a conveyance by it 
and stating that the conveyance has been made as authorized by 
chapter 469 may be filed with the county recorder or registrar 
of titles, and the rights of reverter in favor of the state 
provided by this subdivision 1e will then terminate.  No vote of 
the people shall be is required for such the conveyance.  
     Subd. 1e.  [REVERSION.] In case any such If the 
tax-forfeited land shall is not be so conveyed to the state in 
accordance with subdivision 1d, the commissioner of revenue 
shall by written instrument, in form approved by the attorney 
general, declare the same land to have reverted to the state, 
and shall serve a notice thereof of reversion, with a copy of 
the declaration, by certified mail upon the clerk or recorder of 
the governmental subdivision concerned, provided, that.  No 
declaration of reversion shall be made earlier than five years 
from the date of conveyance for failure to put such land to such 
the use specified or from the date of abandonment of such that 
use if such the lands have been put to such that use.  The 
commissioner shall file the original declaration in the 
commissioner's office, with verified proof of service as herein 
required.  The governmental subdivision may appeal to the 
district court of the county in which the land lies by filing 
with the court administrator a notice of appeal, specifying the 
grounds of appeal and the description of the land involved, 
mailing a copy thereof of the notice of appeal by certified mail 
to the commissioner of revenue, and filing a copy thereof for 
record with the county recorder or registrar of titles, all 
within 30 days after the mailing of the notice of reversion.  
The appeal shall be tried by the court in like manner as a civil 
action.  If no appeal is taken as herein provided in this 
subdivision, the declaration of reversion shall be is final.  
The commissioner of revenue shall file for record with the 
county recorder or registrar of titles, of the county within 
which the land lies, a certified copy of the declaration of 
reversion and proof of service. 
    Subd. 1f.  [EXCHANGE.] Any A city of the first class now or 
hereafter having with a population of 450,000, or over, or its 
board of park commissioners, which has acquired tax-forfeited 
land for a specified public use pursuant to the terms of under 
this section, may convey said the land in exchange for other 
land of substantially equal worth located in said the city of 
the first class, provided that.  The land conveyed to said the 
city of the first class now or hereafter having a population of 
450,000, or over, or its board of park commissioners, in 
exchange shall be is subject to the public use and reversionary 
provisions of this section;.  The tax-forfeited land so conveyed 
shall is thereafter be free and discharged from the public use 
and reversionary provisions of this section, provided that 
said.  The exchange shall in no way affect the mineral or 
mineral rights of the state of Minnesota, if any, in the 
lands so exchanged. 
    Sec. 38.  Minnesota Statutes 1989 Supplement, section 
375.192, subdivision 2, is amended to read: 
    Subd. 2.  Notwithstanding section 270.07, Upon written 
application by the owner of the property, if the application 
seeks a reduction in estimated market value not in excess of 
$10,000, the county board may grant the reduction or abatement 
of estimated market valuation or taxes and of any costs, 
penalties, or interest on them as the board deems just and 
equitable and order the refund in whole or part of any taxes, 
costs, penalties, or interest which have been erroneously or 
unjustly paid.  The application must include the social security 
number of the applicant.  The social security number is private 
data on individuals as defined by section 13.02, subdivision 
12.  The application must be approved by the county assessor, 
or, if the property is located in a city of the first or second 
class having a city assessor, by the city assessor, and by the 
county auditor before consideration by the county board.  The 
methods of obtaining a reduction or abatement of ad valorem 
values contained in subdivisions 1 and 2 are in addition to the 
method provided in section 270.07.  No reduction, abatement, or 
refund of any special assessments made or levied by any 
municipality for local improvements shall be made unless it is 
also approved by the board of review or similar taxing authority 
of the municipality.  Before taking action on any reduction or 
abatement where the reduction of taxes, costs, penalties, and 
interest exceed $10,000, the county board shall give 20 days' 
notice to the school board and the municipality in which the 
property is located.  The notice must describe the property 
involved, the actual amount of the reduction being sought, and 
the reason for the reduction.  If the school board or the 
municipality object to the granting of the reduction or 
abatement, the county board must refer the abatement or 
reduction to the commissioner of revenue with its 
recommendation.  The commissioner shall consider the abatement 
or reduction under section 270.07, subdivision 1.  
    An appeal may not be taken to the tax court from any order 
of the county board made in the exercise of the discretionary 
authority granted in this section.  
    Sec. 39.  Minnesota Statutes 1989 Supplement, section 
462.396, subdivision 2, is amended to read: 
    Subd. 2.  On or before August 20 each year, the commission 
shall submit its proposed budget for the ensuing calendar year 
showing anticipated receipts, disbursements and ad valorem tax 
levy with a written notice of the time and place of the public 
hearing on the proposed budget to each county auditor and 
municipal clerk within the region and those town clerks who in 
advance have requested a copy of the budget and notice of public 
hearing.  On or before October 1 each year, the commission shall 
adopt, after a public hearing held not later than September 20, 
a budget covering its anticipated receipts and disbursements for 
the ensuing year and shall decide upon the total amount 
necessary to be raised from ad valorem tax levies to meet its 
budget.  After adoption of the budget and no later than October 
1, the secretary of the commission shall certify to the auditor 
of each county within the region the county share of the tax, 
which shall be an amount bearing the same proportion to the 
total levy agreed on by the commission as the net tax capacity 
of the county bears to the net tax capacity of the region.  For 
taxes levied in 1990 and thereafter, the maximum amount amounts 
of any levy levies made for the purposes of sections 462.381 to 
462.398 shall not exceed 0.00403 percent of market value on all 
taxable property in the region. are the following amounts, less 
the sum of regional planning grants from the state planning 
agency to that region:  for Region 1, $180,337; for Region 2, 
$150,000; for Region 3, $353,110; for Region 5, $195,865; for 
Region 6E, $197,177; for Region 6W, $150,000; for Region 7E, 
$158,653; for Region 8, $206,107; for Region 9, $343,572.  The 
auditor of each county in the region shall add the amount of any 
levy made by the commission within the limits imposed by this 
subdivision to other tax levies of the county for collection by 
the county treasurer with other taxes.  When collected the 
county treasurer shall make settlement of the taxes with the 
commission in the same manner as other taxes are distributed to 
political subdivisions. 
    Sec. 40.  Minnesota Statutes 1988, section 469.059, 
subdivision 11, is amended to read: 
    Subd. 11.  [PROCEDURE.] Tax-forfeited lands in an 
industrial development district that are vested in the state 
shall be conveyed to the port authority that is developing the 
district for one dollar per tract.  The port authority may use 
and later resell the land for purposes of sections 469.048 to 
469.068.  
    In conveying tax-forfeited land to a port authority, the 
state may not retain a possibility of reverter or right of 
reentry as it does under section 282.01, subdivision 1 1e.  
    The commissioner of revenue shall convey tax-forfeited 
parcels in an industrial development district to the port 
authority, if the authority petitions for conveyance under 
sections 469.048 to 469.068 and pays one dollar per tract.  
    The attorney general shall approve the form of the deed of 
conveyance.  The port authority shall receive absolute title to 
the tract, subject only to a reservation of minerals and mineral 
rights, under section 282.12.  The deed of conveyance must not 
contain a restriction on the use of the premises.  The 
conveyance divests the state of all further right, title, claim 
or interest in the tracts, except for the reservation of 
minerals and mineral rights. 
    Sec. 41.  Minnesota Statutes Second 1989 Supplement, 
section 469.171, subdivision 7a, is amended to read: 
    Subd. 7a.  [PROPERTY TAX CREDIT; APPROPRIATION.] There is 
annually appropriated from the general fund to the commissioner 
of revenue the amounts required to reimburse taxing 
jurisdictions for the revenue lost due to the property tax 
credit provided in subdivision 1, clause (4).  Payment shall be 
made to taxing jurisdictions in the same proportion that the ad 
valorem tax is distributed.  Payment shall be made to taxing 
jurisdictions, other than school districts, at the times time 
provided in section 477A.015 473H.10, subdivision 3.  
    Sec. 42.  Minnesota Statutes Second 1989 Supplement, 
section 473H.10, subdivision 3, is amended to read: 
    Subd. 3.  [COMPUTATION OF TAX; STATE REIMBURSEMENT.] (a) 
After having determined the market value of all land valued 
according to subdivision 2, the assessor shall compute the gross 
tax capacity of those properties by applying the appropriate 
classification percentages.  When computing the rate of tax 
pursuant to section 275.08, the county auditor shall include the 
gross tax capacity of land as provided in this clause.  
    (b) The county auditor shall compute the tax on lands 
valued according to subdivision 2 and nonresidential buildings 
by multiplying the gross tax capacity times the total rate of 
tax for all purposes as provided in clause (a).  
    (c) The county auditor shall then compute the maximum ad 
valorem property tax on lands valued according to subdivision 2 
and nonresidential buildings by multiplying the gross tax 
capacity times 105 percent of the previous year's statewide 
average tax capacity rate levied on property located within 
townships for all purposes.  
    (d) The tax due and payable by the owner of preserve land 
valued according to subdivision 2 and nonresidential buildings 
will be the amount determined in clause (b) or (c), whichever is 
less.  If the gross tax in clause (c) is less than the gross tax 
in clause (b), the state shall reimburse the taxing 
jurisdictions for the amount of difference.  Residential 
buildings shall continue to be valued and classified according 
to the provisions of sections 273.11 and 273.13, as they would 
be in the absence of this section, and the tax on those 
buildings shall not be subject to the limitation contained in 
this clause.  
    The county may transfer money from the county conservation 
account created in section 40A.152 to the county revenue fund to 
reimburse the fund for the tax lost as a result of this 
subdivision or to pay taxing jurisdictions within the county for 
the tax lost.  The county auditor shall certify to the 
commissioner of revenue on or before June 1 the total amount of 
tax lost to the county and taxing jurisdictions located within 
the county as a result of this subdivision and the extent that 
the tax lost exceeds funds available in the county conservation 
account.  Payments Payment shall be made by the state at the 
times provided in section 477A.015 on December 15 to each of the 
affected taxing jurisdictions, other than school districts, in 
the same proportion that the ad valorem tax is distributed if 
the county conservation account is insufficient to make the 
reimbursement.  There is annually appropriated from the 
Minnesota conservation fund under section 40A.151 to the 
commissioner of revenue an amount sufficient to make the 
reimbursement provided in this subdivision.  If the amount 
available in the Minnesota conservation fund is insufficient, 
the balance that is needed is appropriated from the general fund.
    Sec. 43.  Minnesota Statutes Second 1989 Supplement, 
section 477A.013, subdivision 6, is amended to read: 
    Subd. 6.  [AID ADJUSTMENT.] For calendar year 1990, there 
shall be an amount equal to 3.4 percent of the town's or city's 
adjusted net tax capacity computed using the net class rates for 
taxes payable in 1990 and equalized market values as defined in 
section 273.1398, subtracted from the aid amounts computed under 
subdivision 1, in the case of towns, and under subdivisions 3 
and 5 in the case of cities.  For cities, the subtraction will 
be made first from the aid computed under subdivision 3.  If the 
subtraction amount under this section is greater than the aid 
amount computed under subdivision 3, the remaining amount will 
be subtracted from the aid computed under subdivision 5.  The 
resulting amounts shall be the town's local government aid or 
the city's local government aid and equalization aid for 
calendar year 1990.  The local government aid and equalization 
aid amount for any city or town cannot be less than zero.  If 
the subtraction amount under this section is greater than the 
amount for any town or city computed under subdivisions 1, 3, 
and 5, the remaining amount shall be subtracted from the town's 
or city's homestead and agricultural credit aid under section 
273.1398, subdivision 2. 
    For purposes of this subdivision, "adjusted net tax 
capacity" means the city's total net tax capacity using the net 
class rates for taxes payable in 1990 and equalized market 
values as defined in section 273.1398, as adjusted for the 
contributions and distributions required by chapter 473F in the 
case of a city or town located within the metropolitan area and 
less the captured value in any tax increment district. 
    An increase in a city's property tax levy for taxes payable 
in 1990 attributable to the amount deducted from the city's aids 
under this subdivision is exempt from the city's per capita levy 
limit under section 275.11 and, from the city's percentage of 
market value levy limit under section 412.251 or 426.04, and 
from any limitation on levies under a city charter. 
    Sec. 44.  Laws 1989, chapter 326, article 3, section 49, is 
amended to read: 
    Sec. 49.  [EFFECTIVE DATE.] 
    Section 9 is effective July 1, 1989, but a well 
notification is not required to be filed with the commissioner 
for construction of a well until after December 31, 1989. 
    Section 14 relating to disclosing wells to buyers and 
transferees is effective July 1, 1990, on lands other than 
tax-forfeited lands, and is effective July 1, 1991, on 
tax-forfeited lands. 
    Section, Sections 31, 32, and 33 are effective July 1, 
1990, and limited well contractor licenses and limited well 
sealing licenses may not be issued until after that date. 
    Sections 24 and 33 relating to permits required for 
elevator shafts and elevator shaft contractor licenses are 
effective July 1, 1990. 
    Sec. 45.  Laws 1989, chapter 353, section 13, is amended to 
read: 
    Sec. 13.  [EFFECTIVE DATE.] 
    This act is effective July 1, 1989.  Sections 6 and 9 apply 
to state land and tax-forfeited land sold after March 15, 1990 
1991. 
    Sec. 46.  [ASSESSMENT OF MANUFACTURED HOME PARKS.] 
    Subdivision 1.  [LIMITED VALUATION INCREASE.] (a) 
Notwithstanding Minnesota Statutes, section 273.11, or any other 
law to the contrary, the estimated market value of a 
manufactured home park, as defined in section 327.14, 
subdivision 3, and assessed under section 273.13, subdivision 
25, for taxes levied in 1990, may not exceed 133-1/3 percent of 
its estimated market value for taxes levied in 1989 as limited 
by Laws 1989, First Special Session chapter 1, article 3, 
section 32, subdivision 1.  The excess market value must be 
entered equally in the next two succeeding assessment years. 
    (b) This subdivision does not apply to increases in value 
attributable to improvements made to the real estate since the 
January 2, 1989, assessment.  It does not apply to property 
becoming subject to taxation since the January 2, 1989, 
assessment.  The limitation in this subdivision applies to any 
increase in valuation imposed by the local boards of review 
under section 274.01, the county boards of equalization under 
section 274.13, and the state board of equalization and the 
commissioner of revenue under sections 270.11, 270.12, and 
270.16. 
    Subd. 2.  [NOTICE TO PROPERTY OWNER.] (a) If an assessor 
has increased the estimated market value of property over that 
allowed in subdivision 1, the assessor must reduce the estimated 
market value to the amount allowed under subdivision 1. 
    (b) If an assessor has notified owners of property subject 
to subdivision 1 of an increase in estimated market value for 
taxes payable in 1991, the assessor must mail notice to the 
property owners by July 1, 1990.  The notice must state that any 
increase in the estimated market value of manufactured home park 
land for taxes levied in 1990 over that for taxes levied in 1989 
has been limited by this act. 
     Sec. 47.  Laws 1989, First Special Session chapter 1, 
article 5, section 52, is amended to read: 
    Sec. 52.  [EFFECTIVE DATE.] 
    Except as otherwise provided, sections 12 to 19, 27, 35, 
45, and 47 are effective for taxes levied in 1989, payable in 
1990 and subsequent years.  Section 49 is effective upon 
approval by the Itasca county board for taxes levied in 1988, 
payable in 1989 only.  Sections 1, 5, 6, 20, 31, 34, 41, 44, and 
51 are effective for taxes levied by cities and towns in 1991, 
payable in 1992 and thereafter, and for taxes levied by counties 
in 1992, payable in 1993 and thereafter.  Sections 2, 4, 7, 9 to 
11, 21 to 26, 28 to 30, 32, 33, 36 to 40, 42, and 43 are 
effective for taxes levied in 1991 1992, payable in 1992 1993, 
and thereafter.  Sections 3 and 8 are effective for taxes levied 
in 1992, payable in 1993 and thereafter.  Section 50 is 
effective for taxes payable in 1989 and 1990 only. 
    Sec. 48.  Laws 1990, chapter 480, article 8, section 18, is 
amended to read:  
    Sec. 18.  [EFFECTIVE DATE.] 
    Sections 1 to 8, 10, and 14 15 are effective for taxes 
levied in 1989, payable in 1990, and thereafter. 
    Sections 9, 11 to 13, 15 14, and 16 are effective January 
1, 1991. 
    Section 17 is effective the day following final enactment. 
    Sec. 49.  [CITY OF BAYPORT; LIBRARY LEVY.] 
    Subdivision 1.  [LEVY AUTHORIZED.] Notwithstanding the 
limit in Minnesota Statutes, section 275.50, subdivision 5, 
clause (o), for taxes levied in 1990, payable in 1991, the city 
of Bayport may levy $156,158 to pay operating costs of the city 
library.  This amount is not subject to the limitations in 
Minnesota Statutes, sections 275.50 to 275.56.  For taxes levied 
in 1991 and thereafter, payable in 1992 and thereafter, the city 
may levy as a special levy the amount authorized under Minnesota 
Statutes, section 275.50, subdivision 5, clause (o).  For 
purposes of determining the maximum levy increase under that 
section, the amount levied in 1990, payable in 1991, shall be 
the base amount. 
    Subd. 2.  [LOCAL APPROVAL; EFFECTIVE DATE.] This section is 
effective the day after approval by the governing body of the 
city of Bayport and its compliance with Minnesota Statutes, 
section 645.021, subdivision 3. 
    Subd. 3.  [REVERSE REFERENDUM.] If the Bayport city council 
intends to exercise the authority provided by this section in 
subsequent years, it shall pass a resolution stating the fact 
before January 1, 1991.  The resolution must be published for 
two successive weeks in the official newspaper of the city or, 
if there is no official newspaper, in a newspaper of general 
circulation in the city, together with a notice fixing a date 
for a public hearing on the matter.  The hearing must be held at 
least two weeks but not more than four weeks after the first 
publication of the resolution.  Following the public hearing, 
the city may determine to take no further action or adopt a 
resolution confirming its intention to exercise the authority.  
That resolution must also be published in the official newspaper 
of the city or, if there is no official newspaper, in a 
newspaper of general circulation in the city.  If within 30 days 
after publication of the resolution a petition signed by voters 
equal in number to five percent of the votes cast in the city in 
the last general election requesting a vote on the proposed 
resolution is filed with the county auditor, the resolution is 
not 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 election.  The referendum must 
be held at a special or general election before December 1, 1991.
    Sec. 50.  [GOODHUE COUNTY; HISTORICAL SOCIETY LEVY.] 
     Subdivision 1.  [LEVY AUTHORIZED.] For taxes levied in 1990 
and 1991, payable in 1991 and 1992, Goodhue county may levy up 
to $225,000 each year on property in the county and use the 
proceeds of the levy for the county historical society.  This 
amount is not subject to the limitations in Minnesota Statutes, 
sections 275.50 to 275.56.  
    Subd. 2.  [LOCAL APPROVAL; EFFECTIVE DATE.] This section is 
effective the day after approval by the Goodhue county board and 
its compliance with Minnesota Statutes, section 645.021, 
subdivision 3. 
    Subd. 3.  [REVERSE REFERENDUM.] If the Goodhue county board 
intends to exercise the authority provided by this section in 
subsequent years, it shall pass a resolution stating the fact 
before January 1, 1991.  The resolution must 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 must be held at 
least two weeks but not 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 adopt a 
resolution confirming its intention to exercise the authority.  
That resolution must 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 after publication of the resolution 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 vote on the 
proposed resolution is filed with the county auditor, the 
resolution is not 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 election.  The 
referendum must be held at a special or general election before 
December 1, 1991. 
    Sec. 51.  [CITY OF WINDOM; HOSPITAL LEVY.] 
    Subdivision 1.  [LEVY AUTHORIZED.] For taxes levied in 1990 
and 1991, payable in 1991 and 1992, the city of Windom may levy 
an amount up to $50,000 each year to meet the operating costs of 
the operating deficit of the municipal hospital.  The annual 
amount levied under this section shall not exceed the amount 
needed to meet the cost of the operating deficit of the 
hospital.  This amount is not subject to the limitations in 
Minnesota Statutes, sections 275.50 to 275.56.  
    Subd. 2.  [LOCAL APPROVAL; EFFECTIVE DATE.] This section is 
effective the day after approval by the governing body of the 
city of Windom and its compliance with Minnesota Statutes, 
section 645.021, subdivision 3. 
    Subd. 3.  [REVERSE REFERENDUM.] If the Windom city council 
intends to exercise the authority provided by this section in 
subsequent years, it shall pass a resolution stating the fact 
before January 1, 1991.  The resolution must be published for 
two successive weeks in the official newspaper of the city or, 
if there is no official newspaper, in a newspaper of general 
circulation in the city, together with a notice fixing a date 
for a public hearing on the matter.  The hearing must be held at 
least two weeks but not more than four weeks after the first 
publication of the resolution.  Following the public hearing, 
the city may determine to take no further action or adopt a 
resolution confirming its intention to exercise the authority.  
That resolution must also be published in the official newspaper 
of the city or, if there is no official newspaper, in a 
newspaper of general circulation in the city.  If within 30 days 
after publication of the resolution a petition signed by voters 
equal in number to five percent of the votes cast in the city in 
the last general election requesting a vote on the proposed 
resolution is filed with the county auditor, the resolution is 
not 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 election.  The referendum must 
be held at a special or general election before December 1, 1991.
    Sec. 52.  [KOOCHICHING COUNTY; AMBULANCE SERVICE LEVY.] 
    For taxes levied in 1990, payable in 1991, and thereafter, 
Koochiching County may levy to pay the costs of ambulance 
service in a county subordinate service district under Minnesota 
Statutes, section 375B.09.  This amount is not subject to the 
limitations in Minnesota Statutes, sections 275.50 to 275.56.  
    Sec. 53.  [DOUGLAS COUNTY; SOLID WASTE MANAGEMENT LEVY.] 
    For taxes levied in 1990, payable in 1991, and thereafter, 
Douglas county may levy the amount necessary to pay the 
principal and interest on department of energy and economic 
development loans made to the Pope-Douglas solid waste board on 
June 10, 1985, and June 15, 1986, for solid waste management 
purposes.  The levy must be made as provided under Minnesota 
Statutes, section 400.11.  
    This amount is not subject to the limitations in Minnesota 
Statutes, sections 275.50 to 275.56.  
    If the county utilizes this levy, and any part of the 
amount levied by the county in the previous levy year for the 
purposes specified under this section was included in the 
county's previous year's levy limitation computed under section 
275.51, that amount must be deducted from the levy limit base 
under section 275.51, subdivision 3f, when determining the 
county's current year levy limitation.  The county shall provide 
the necessary information to the commissioner of revenue for 
making this determination.  
    The levy authority under this section expires when the 
principal and interest has been paid. 
    Sec. 54.  [MILLE LACS COUNTY; SPECIAL LEVY.] 
    For taxes levied in 1990, payable in 1991 only, Mille Lacs 
county may levy an amount equal to the expenditures from reserve 
funds used in 1990 to pay social service costs.  The county must 
provide evidence to the commissioner of revenue that 
expenditures from reserve funds were made for this purpose.  
This levy may not exceed $694,000.  This levy is not subject to 
the levy limitations in Minnesota Statutes, sections 275.50 to 
275.56. 
    Sec. 55.  [BECKER COUNTY; SPECIAL LEVY.] 
    For taxes levied in 1990, payable in 1991 only, Becker 
county may levy an amount equal to expenditures it made from 
reserve funds in calendar years 1987 and 1988.  For purposes of 
this section, the reserves used in calendar year 1987 shall 
include money received under the federal revenue sharing program 
from previous years.  This levy may not exceed $900,000.  The 
county must provide evidence to the commissioner of revenue that 
it was eligible for a levy limit base adjustment for taxes 
levied in 1988 for use of reserve funds under Minnesota 
Statutes, section 275.51, subdivision 3j and did not receive the 
adjustment.  This levy is not subject to the levy limitations in 
Minnesota Statutes, sections 275.50 to 275.56. 
    Sec. 56.  [GOODHUE COUNTY; SPECIAL LEVY.] 
    For taxes levied in 1990, payable in 1991 only, Goodhue 
county may levy an amount equal to the reduction to its levy 
limit base, for taxes levied in 1989, under Minnesota Statutes 
Second 1989 Supplement, section 275.51, subdivision 3f, 
paragraph (i).  This levy is not subject to the levy limitations 
in Minnesota Statutes, sections 275.50 to 275.56. 
     Sec. 57.  [BONDS AUTHORIZED.] 
    Subdivision 1.  The governing body of the city of Bemidji 
or Beltrami county may sell and issue general obligation bonds 
or revenue bonds of the city or the county, respectively, to 
finance the construction and betterment of an airport terminal 
and other air navigation facilities as defined in Minnesota 
Statutes, section 360.013, or of other related facilities, 
including hangars, repair shops and other buildings, and 
equipment needed for the storage, repair, reconstruction, and 
servicing of aircraft.  The bonds may be issued by the city or 
the county on its own behalf with the consent of both parties, 
or with the consent of the other on behalf of both of them.  The 
bonds must be issued, sold and secured in accordance with 
Minnesota Statutes, chapter 475, except as provided in 
subdivisions 2 and 3.  The facilities to be financed by the 
bonds are a public convenience from which a revenue is derived, 
and are not indebtedness under chapter 475 or any city charter. 
    Subd. 2.  The aggregate principal amount of all bonds 
issued by the city or the county under this section which are 
outstanding and undischarged at any time shall not exceed 
$400,000.  
    Subd. 3.  If either the city or the county issues bonds on 
behalf of both of them, the entity not issuing the bonds may 
levy ad valorem taxes on all taxable property within its 
corporate limits to pay the principal of and interest on the 
bonds as agreed upon before their issuance, and may irrevocably 
appropriate the collections of the taxes to the sinking fund 
established by the issuing entity for the payment of the bonds.  
The entity issuing the bonds may levy ad valorem taxes on all 
taxable property within its corporate limits for the years and 
in the amounts that, together with any taxes levied and 
appropriated by the nonissuing entity, will meet the 
requirements of Minnesota Statutes, section 475.61.  Neither the 
taxes nor any additional taxes levied to eliminate any 
deficiencies in the collection thereof are subject to any 
limitation established by general or special law or charter as 
to rate or amount.  The taxes may not be considered in 
determining the amount of any other taxes which may be levied 
subject to any such limitation. 
    Subd. 4.  (a) After approval of a bond issue under 
subdivision 1 or the first approval of a tax levy to pay bond 
obligations under subdivision 3, the governing body of the city 
for a city action or the county for a county action shall 
publish notice of the action in its official publication.  The 
bonds may be issued and sold or the tax levied without 
submitting the question to the voters, unless within 30 days 
after the date of publication a petition signed by qualified 
voters equal to five percent of the voters who voted in the last 
general election in the governmental subdivision is filed with 
the city or the county. 
    (b) If a petition is filed that meets the requirements of 
paragraph (a), the bonds may be issued or the tax levied upon 
obtaining the approval of a majority of the voters voting on the 
question at a special or regular election. 
    Sec. 58.  [RAMSEY COUNTY; AUTHORIZATION FOR BONDS.] 
    Ramsey county may issue general obligation bonds in one or 
more series in an amount not to exceed $2,000,000, in the 
aggregate, to finance the restoration of the concourse of the 
St. Paul union depot as a facility for the arts and sciences, 
the proceeds of which may not be used for that purpose until 
$500,000 in operational funding has been committed by other 
sources.  The bonds shall be issued pursuant to Minnesota 
Statutes, chapter 475, except that the bonds shall not be 
subject to its election requirements or debt limits.  They shall 
not be subject to any other debt or tax levy limitations 
applicable to the county and shall not be considered in 
calculating amounts subject to any other debt or tax levy 
limitations.  Levies by the county for debt servicing payment 
for the retirement of the bonds shall be exempt from and 
disregarded in the calculation of all tax levy limitations 
applicable to the county. 
    Sec. 59.  [ROSEMOUNT; ARMORY LEVY.] 
    Subdivision 1.  [ARMORY LEVY.] The city of Rosemount in 
Dakota county may levy not more than $95,000 per year and 
otherwise incur debt obligations under Minnesota Statutes, 
chapter 193 or 475 or both, to acquire and better an armory and 
to be serviced by the levy without regard to the limits on debt 
service and debt otherwise provided by chapter 193 or 475.  This 
levy amount shall be a special levy under Minnesota Statutes, 
section 275.50, subdivision 5, clause (d). 
    Subd. 2.  [REVERSE REFERENDUM.] If the city council 
proposes to pay the obligation under 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 city or, if there is no official newspaper, in 
a newspaper of general circulation in the city, 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 city may determine to take no further 
action or adopt a resolution confirming its intention to 
exercise the authority.  That resolution shall also be published 
in the official newspaper or, if there is no official newspaper, 
in a newspaper of general circulation in the city.  If within 30 
days thereafter a petition signed by voters equal in number to 
ten percent of the votes cast in the city 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 January 1, 
1992. 
    Sec. 60.  [JOINT POWERS LEVY; DRUG ENFORCEMENT.] 
    Notwithstanding Minnesota Statutes, sections 275.50 to 
275.56, the cities of Maple Grove, Brooklyn Park, Brooklyn 
Center, and Coon Rapids may each levy for taxes levied in 1990, 
and thereafter, an amount up to $2 per capita to pay the costs 
incurred under a joint powers agreement for the salaries and 
benefits of peace officers whose primary responsibilities are to 
investigate controlled substance crimes under chapter 152 or to 
teach drug abuse resistance education curricula in schools. 
    Sec. 61.  [DEBT SERVICE LEVY FOR CERTAIN CERTIFICATES OF 
INDEBTEDNESS.] 
    Subdivision 1.  [LEVY.] Notwithstanding Minnesota Statutes, 
section 475.754, if a city has issued certificates of 
indebtedness under that section during calendar year 1989 in an 
amount not exceeding $150,000 for the purpose of meeting the 
unanticipated cost of repairing a major structural defect in a 
building that was undergoing renovation for which other 
obligations had been issued previously, any levy to pay the debt 
service on those certificates shall be a special levy under 
Minnesota Statutes, section 275.50, subdivision 5, paragraph (c).
    Subd. 2.  [REVERSE REFERENDUM.] If the city intends to 
exercise the authority provided by subdivision 1 in subsequent 
years, it shall pass a resolution stating the fact before 
January 1, 1991.  The resolution must be published for two 
successive weeks in the official newspaper of the city or, if 
there is no official newspaper, in a newspaper of general 
circulation in the city, together with a notice fixing a date 
for a public hearing on the matter.  The hearing must be held at 
least two weeks but not more than four weeks after the first 
publication of the resolution.  Following the public hearing, 
the city may determine to take no further action or adopt a 
resolution confirming its intention to exercise the authority.  
That resolution must also be published in the official newspaper 
of the city or, if there is no official newspaper, in a 
newspaper of general circulation in the city.  If within 30 days 
after publication of the resolution a petition signed by voters 
equal in number to five percent of the votes cast in the city in 
the last general election requesting a vote on the proposed 
resolution is filed with the county auditor, the resolution is 
not 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 election.  The referendum must 
be held at a special or general election before December 1, 1991.
    Sec. 62.  [HENNEPIN COUNTY; AUTHORITY TO TRANSFER LIGHT 
RAIL MONEY.] 
    Notwithstanding any law to the contrary, the Hennepin 
county regional railroad authority may transfer any available 
money of the authority, including money in capital accounts, to 
Hennepin county to be expended to meet social service costs 
during 1990.  The authority under this section to transfer the 
regional railroad authority levy applies only during calendar 
year 1990. 
    Sec. 63.  [1989 POPULATION AND HOUSEHOLD ESTIMATES USED IN 
1991 AID AND LEVY CALCULATIONS.] 
    Subdivision 1.  [NOTIFICATION OF 
ESTIMATES.] Notwithstanding any other law, for estimates of 
population and number of households of local government 
subdivisions for 1989 only, under Minnesota Statutes, section 
116K.04, subdivision 4, the estimates shall be communicated to 
the governing body of each subdivision by September 1, 1990. 
    Subd. 2.  [1991 AID AND LEVY CALCULATIONS.] Notwithstanding 
any other law, for local government aids under Minnesota 
Statutes, section 273.1398 and chapter 477A and levy limit 
calculations under Minnesota Statutes, sections 275.51 to 
275.56, for aids and levies payable in 1991 only, for local 
governmental subdivisions for which estimates of population and 
number of households for calendar year 1989 do not exist as of 
July 1, 1990, the following estimates of population and number 
of households will be used: 
    (1) For calculation of homestead and agricultural credit 
aid under Minnesota Statutes, section 273.1398, the household 
adjustment factor shall be equal to the number of households, 
for the most recently available estimate as of September 7, 
1990, divided by the number of households from the year previous 
to the most recent estimate; 
    (2) For calculation of levy limits under Minnesota 
Statutes, section 275.51, the population or number of households 
shall be equal to the most recently available estimate of 
population or number of households as of July 1, 1990.  If a 
more recent estimate of population or number of households 
becomes available by October 15, 1990, and use of this more 
recent estimate in the levy limit calculation would increase the 
levy limit for a governmental subdivision, the commissioner of 
revenue shall recompute and recertify this increased levy limit 
to the local government subdivision by October 22, 1990; and 
    (3) For calculation of local government aids under 
Minnesota Statutes, chapter 477A, the population and number of 
households means the population and number of households as 
established by the most recently available estimate as of July 
1, 1990. 
    Subd. 3.  [PROPOSED PROPERTY TAX NOTICES.] If, as a result 
of a more recent estimate of population or number of households, 
a local government's levy limit is increased as provided in 
subdivision 2, clause (2), the amount of the increase in the 
levy limit may be added to the proposed tax levy for purposes of 
the public hearings under Minnesota Statutes, section 275.065, 
subdivision 6.  
    Sec. 64.  [INSTRUCTION TO REVISOR.] 
    In the next edition of Minnesota Statutes, the revisor of 
statutes shall codify in Minnesota Statutes, section 275.50, all 
permanent local special levies enacted in 1990.  
    Sec. 65.  [REPEALER.] 
    (a) Minnesota Statutes 1989 Supplement, section 375.192, 
subdivision 1, is repealed. 
    (b) Minnesota Statutes 1989 Supplement, section 383A.65, is 
repealed. 
    Sec. 66.  [EFFECTIVE DATE.] 
    Sections 3, 36, 37, 40, 44, 45, 47, 48, 62, and 63, are 
effective the day following final enactment. 
    Sections 4, 5, 9, 13 to 19, 23 to 28, 30, 31, 34, 39, 43, 
46, 59, and 61, are effective for taxes levied in 1990, payable 
in 1991, and thereafter, except as otherwise provided. 
    Section 6 is effective August 1, 1990.  
    Section 7 is effective January 1, 1990, and thereafter. 
    Section 10 is effective for taxes levied in 1990, payable 
in 1991, and thereafter.  Notwithstanding Minnesota Statutes, 
section 273.112, subdivision 6, in order to qualify for 
valuation under Minnesota Statutes, section 273.112, for the 
1990 assessment, the taxpayer of the property operated by 
private clubs under Minnesota Statutes, section 273.112, 
subdivision 3, clause (c)(3), must submit an affidavit or other 
written verification to the assessor by July 1, 1990, showing 
that the bylaws in rules and regulations of the private club 
meet the eligibility requirements of section 10 by July 1, 1990. 
    Sections 11, 12, 20, 22, 32, 33, 41, and 42, are effective 
for taxes levied in 1989, payable in 1990, and thereafter. 
    Section 21 is effective for reports filed in 1990, and 
thereafter. 
    Section 35 is effective for appeals filed after the date of 
final enactment. 
    Sections 38 and 65, paragraph (a), are effective for 
reductions or abatements filed with the county board after June 
30, 1990. 
    Section 57 is effective upon approval by a majority of all 
members of the Bemidji city council, and by a majority of all 
members of the Beltrami county board of commissioners, and 
compliance with Minnesota Statutes, section 645.021. 
    Sections 58 and 65, paragraph (b), are effective the day 
after the governing body of the city of St. Paul and the Ramsey 
county board have both complied with Minnesota Statutes, section 
645.021, subdivision 3. 

                               ARTICLE 4 
PROPERTY TAX AIDS AND CREDITS
    Section 1.  Minnesota Statutes Second 1989 Supplement, 
section 256.025, subdivision 4, is amended to read: 
    Subd. 4.  [PAYMENT SCHEDULE.] Beginning July 1, 1991, the 
state will reimburse counties, according to the following 
payment schedule, for the county share of local agency 
expenditures for the programs specified in subdivision 2. 
    (a) Beginning July 1, 1991, the state will reimburse or pay 
the county share of local agency expenditures according to the 
reporting cycle as established by the commissioner, for the 
programs identified in subdivision 2.  Payments for the period 
of January 1, 1991, through July 31, 1991, for calendar years 
1991, 1992, and 1993 shall be made subsequent to on or before 
July 1, 1991 10 in each of those years.  Payments for the period 
August 1991 through December 1991 for calendar years 1991, 1992, 
and 1993 shall be made subsequent to on or before the first 
third of each month thereafter through December 31, 1991 in each 
of those years. 
    (b) Payment for 1/24 of the base amount and the January 
1992 1994 county share of local agency expenditures growth 
amount for the programs identified in subdivision 2 shall be 
made during on or before January 1992 3, 1994.  For the period 
of February 1, 1992 1994, through July 31, 1992 1994, payment of 
the base amount shall be made subsequent to on or before July 1, 
1992 10, 1994, and payment of the growth amount over the base 
amount shall be made monthly on or before the third of each 
month.  Payments for the period August 1992 1994 through 
December 1992 1994 shall be made subsequent to on or before the 
first third of each month thereafter through December 31, 1992 
1994. 
    (c) Payment for the county share of local agency 
expenditures during January 1993 1995 shall be made during on or 
before January 1993 3, 1995.  Payment for 1/24 of the base 
amount and the February 1993 1995 county share of local agency 
expenditures growth amount for the programs identified in 
subdivision 2 shall be made during on or before February 1993 3, 
1995.  For the period of March 1, 1993 1995, through July 
31, 1993 1995, payment of the base amount shall be 
made subsequent to on or before July 1, 1993 10, 1995, and 
payment of the growth amount over the base amount shall be made 
monthly on or before the third of each month.  Payments for the 
period August 1993 1995 through December 1993 1995 shall be made 
subsequent to on or before the first third of each month 
thereafter through December 31, 1993 1995. 
    (d) Monthly payments for the county share of local agency 
expenditures from January 1994 1996 through February 1994 1996 
shall be made subsequent to on or before the first third of each 
month through February 1994 1996.  Payment for 1/24 of the base 
amount and the March 1994 1996 county share of local agency 
expenditures growth amount for the programs identified in 
subdivision 2 shall be made during on or before March 1994 
1996.  For the period of April 1, 1994 1996, through July 
31, 1994 1996, payment of the base amount shall be 
made subsequent to on or before July 1, 1994 10, 1996, and 
payment of the growth amount over the base amount shall be 
made monthly on or before the third of each month.  Payments for 
the period August 1994 1996 through December 1994 1996 shall be 
made subsequent to on or before the first third of each month 
thereafter through December 31, 1994 1996. 
    (e) Monthly payments for the county share of local agency 
expenditures from January 1995 1997 through March 1995 1997 
shall be made subsequent to on or before the first third of each 
month through March 1995 1997.  Payment for 1/24 of the base 
amount and the April 1995 1997 county share of local agency 
expenditures growth amount for the programs identified in 
subdivision 2 shall be made during on or before April 1995 3, 
1997.  For the period of May 1, 1995 1997, through July 31, 1995 
1997, payment of the base amount shall be made subsequent to on 
or before July 1, 1995 10, 1997, and payment of the growth 
amount over the base amount shall be made monthly on or before 
the third of each month.  Payments for the period August 1995 
1997 through December 1995 1997 shall be made subsequent to on 
or before the first third of each month thereafter through 
December 31, 1995 1997. 
    (f) Monthly payments for the county share of local agency 
expenditures from January 1996 1998 through April 1996 1998 
shall be made subsequent to on or before the first third of each 
month through April 1996 1998.  Payment for 1/24 of the base 
amount and the May 1996 1998 county share of local agency 
expenditures growth amount for the programs identified in 
subdivision 2 shall be made during on or before May 1996 3, 
1998.  For the period of June 1, 1996 1998, through July 
31, 1996 1998, payment of the base amount shall be 
made subsequent to on or before July 1, 1996 10, 1998, and 
payment of the growth amount over the base amount shall be 
made monthly on or before the third of each month.  Payments for 
the period August 1996 1998 through December 1996 1998 shall be 
made subsequent to on or before the first third of each month 
thereafter through December 31, 1996 1998. 
    (g) Monthly payments for the county share of local agency 
expenditures from January 1997 1999 through May 1997 1999 shall 
be made subsequent to on or before the first third of each month 
through May 1997 1999.  Payment for 1/24 of the base amount and 
the June 1997 1999 county share of local agency expenditures 
growth amount for the programs identified in subdivision 2 shall 
be made during on or before June 1997 3, 1999.  For the period 
of June 1, 1997 1999, through July 31, 1997 1999, payment shall 
be made subsequent to on or before July 1, 1997 10, 1999.  
Payments for the period August 1997 1999 through December 1997 
1999 shall be made subsequent to on or before the first third 
of each month thereafter through December 31, 1997 1999. 
    (h) Effective January 1, 1998 2000, monthly payments for 
the county share of local agency expenditures shall be made 
subsequent to the first of each month. 
    Payments under this subdivision are subject to the 
provisions of section 256.017.  
    Sec. 2.  Minnesota Statutes Second 1989 Supplement, section 
273.1398, subdivision 1, is amended to read: 
    Subdivision 1.  [DEFINITIONS.] (a) In this section, the 
terms defined in this subdivision have the meanings given them. 
    (b) "Unique taxing jurisdiction" means the geographic area 
subject to the same set of tax capacity rates. 
    (c) "Gross tax capacity" means the product of the gross 
class rates and estimated market values.  "Total gross tax 
capacity" means the gross tax capacities for all property within 
the unique taxing jurisdiction.  The total gross tax capacity 
used shall be reduced by the sum of (1) the unique taxing 
jurisdiction's gross tax capacity of commercial industrial 
property as defined in section 473F.02, subdivision 3, 
multiplied by the ratio determined pursuant to section 473F.08, 
subdivision 6, for the municipality, as defined in section 
473F.02, subdivision 8, in which the unique taxing jurisdiction 
is located, (2) the gross tax capacity of the captured value of 
tax increment financing districts as defined in section 469.177, 
subdivision 2, and (3) the gross tax capacity of transmission 
lines deducted from a local government's total gross tax 
capacity under section 273.425.  Gross tax capacity cannot be 
less than zero. 
    (d) "Net tax capacity" means the product of (i) the 
appropriate net class rates for the year in which the aid is 
payable, except that for aids payable in 1991 the class rate 
applied to class 3 utility real and personal property the class 
rate applied shall be 5.38 percent; the class rate applied to 
class 4c property and that portion of class 3 property with an 
actual net class rate of 2.3 percent shall be 2.4 percent; the 
class rates applied to class 2a agricultural homestead property 
excluding the house, garage, and one acre shall be .4 percent 
for the first $100,000 of value reduced by the value of the 
house, garage, and one acre, 1.3 percent for the remaining value 
of the first 320 acres, and 1.7 percent for the remaining value 
of any acreage in excess of 320 acres; the class rate applied to 
class 2b property shall be 1.7 percent; the class rate applied 
to class 1b property shall be .4 percent; and the class rate for 
the portion of class 1 property and the house, garage, and one 
acre portion of class 2a property with a market value in excess 
of $100,000 shall be 5.38 percent 3.0 percent, and (ii) 
estimated market values for the assessment two years prior to 
that in which aid is payable.  The reclassification of mobile 
home parks as class 4c shall not be considered in determining 
net tax capacity for purposes of this paragraph for aids payable 
in 1991 or 1992.  The reclassification of fraternity and 
sorority houses as class 4c shall not be considered in 
determining net tax capacity for purposes of this paragraph for 
aids payable in 1991. "Total net tax capacity" means the net tax 
capacities for all property within the unique taxing 
jurisdiction.  The total net tax capacity used shall be reduced 
by the sum of (1) the unique taxing jurisdiction's net tax 
capacity of commercial industrial property as defined in section 
473F.02, subdivision 3, multiplied by the ratio determined 
pursuant to section 473F.08, subdivision 6, for the 
municipality, as defined in section 473F.02, subdivision 8, in 
which the unique taxing jurisdiction is located, (2) the net tax 
capacity of the captured value of tax increment financing 
districts as defined in section 469.177, subdivision 2, and (3) 
the net tax capacity of transmission lines deducted from a local 
government's total net tax capacity under section 273.425.  For 
purposes of determining the net tax capacity of property 
referred to in clauses (1) and (2), the net tax capacity shall 
be multiplied by the ratio of the highest class rate for class 
3a property for taxes payable in the year in which the aid is 
payable to the highest class rate for class 3a property in the 
prior year.  Net tax capacity cannot be less than zero. 
    (e) "Previous net tax capacity" means the product of the 
appropriate net class rates for the year previous to the year in 
which the aid is payable, and estimated market values for the 
assessment two years prior to that in which aid is payable.  
"Total previous net tax capacity" means the previous net tax 
capacities for all property within the unique taxing 
jurisdiction.  The total previous net tax capacity shall be 
reduced by the sum of (1) the unique taxing jurisdiction's 
previous net tax capacity of commercial-industrial property as 
defined in section 473F.02, subdivision 3, multiplied by the 
ratio determined pursuant to section 473F.08, subdivision 6, for 
the municipality, as defined in section 473F.02, subdivision 8, 
in which the unique taxing jurisdiction is located, (2) the 
previous net tax capacity of the captured value of tax increment 
financing districts as defined in section 469.177, subdivision 
2, and (3) the previous net tax capacity of transmission lines 
deducted from a local government's total net tax capacity under 
section 273.425.  Previous net tax capacity cannot be less than 
zero. 
    (f) "Equalized market values" are market values that have 
been equalized by dividing the assessor's estimated market value 
for the second year prior to that in which the aid is payable by 
the assessment sales ratios determined by class in the 
assessment sales ratio study conducted by the department of 
revenue pursuant to section 124.2131 in the second year prior to 
that in which the aid is payable.  The equalized market values 
shall equal the unequalized market values divided by the 
assessment sales ratio. 
    (f) (g) "1989 local tax rate" means the quotient derived by 
dividing the gross taxes levied within a unique taxing 
jurisdiction for taxes payable in 1989 by the gross tax capacity 
of the unique taxing jurisdiction for taxes payable in 1989.  
For computation of the local tax rate for aid payable in 1991 
and subsequent years, gross taxes for taxes payable in 1989 
exclude equalized levies as defined in subdivision 2a.  For 
purposes of computation of the local tax rate only, gross taxes 
shall not be adjusted by inflation or household growth. 
    (h) "Current local tax rate" means the quotient derived by 
dividing the taxes levied within a unique taxing jurisdiction 
for taxes payable in the year prior to that for which aids are 
being calculated by the net tax capacity of the unique taxing 
jurisdiction.  
    (g) (i) For purposes of calculating the homestead and 
agricultural credit aid authorized pursuant to subdivision 2, 
the "subtraction factor" is the product of (i) a unique taxing 
jurisdiction's 1989 local tax rate; (ii) its total net tax 
capacity; and (iii) 0.9767. 
    (h) (j) For purposes of calculating and allocating 
homestead and agricultural credit aid authorized pursuant to 
subdivision 2 and the disparity reduction aid authorized in 
subdivision 3, "gross taxes levied on all properties" or, "gross 
taxes," or "taxes levied" means the total gross taxes levied on 
all properties except that levied on the captured value of tax 
increment districts as defined in section 469.177, subdivision 
2, and that levied on the portion of commercial industrial 
properties' assessed value or gross tax capacity, as defined in 
section 473F.02, subdivision 3, subject to the areawide tax as 
provided in section 473F.08, subdivision 6, in a unique taxing 
jurisdiction.  Gross taxes levied on all properties or gross 
taxes are before reduction by any credits for taxes payable in 
1989.  "Gross taxes" are before any reduction for disparity 
reduction aid but "taxes levied" are after any reduction for 
disparity reduction aid.  Gross taxes levied or taxes levied 
cannot be less than zero.  
    For homestead and agricultural credit aid payable in 1991 
and subsequent years, "gross taxes" or "gross taxes levied on 
all properties" shall mean gross taxes payable in 1989, 
excluding taxes defined as "equalized levies" in subdivision 2a, 
multiplied by the cost-of-living adjustment factor and the 
household adjustment factor.  
     "Taxes levied" excludes actual amounts levied for purposes 
listed in subdivision 2a. 
    (i) (k) "Human services aids" means: 
    (1) aid to families with dependent children under sections 
256.82, subdivision 1, and 256.935, subdivision 1; 
    (2) medical assistance under sections 256B.041, subdivision 
5, and 256B.19, subdivision 1; 
    (3) general assistance medical care under section 256D.03, 
subdivision 6; 
    (4) general assistance under section 256D.03, subdivision 
2; 
    (5) work readiness under section 256D.03, subdivision 2; 
    (6) emergency assistance under section 256.871, subdivision 
6; 
    (7) Minnesota supplemental aid under section 256D.36, 
subdivision 1; 
    (8) preadmission screening and alternative care grants 
under section 256B.091; 
    (9) work readiness services under section 256D.051; 
    (10) case management services under section 256.736, 
subdivision 13; 
    (11) general assistance claims processing, medical 
transportation and related costs; and 
    (12) medical assistance, medical transportation and related 
costs. 
    (j) "Adjustment factor" means one plus the percentage 
change in (1) the ratio of estimated market value of residential 
homesteads to the estimated market value of all taxable property 
within the city or township containing the unique taxing 
jurisdiction based on the assessment one year prior to the year 
in which the aid is payable when compared to the same ratio 
based on the assessment two years prior to the year in which the 
aid is payable.  If the market value of farm homesteads exceeds 
the market value of residential homesteads in the city or 
township containing the unique taxing jurisdiction, "adjusted 
factor" means one plus the percentage change in the ratio of the 
estimated market value of farm homesteads to the estimated 
market value of all taxable property within the city or township 
containing the unique taxing jurisdiction based on the 
assessment one year prior to the year in which the aid is 
payable when compared to the same ratio based on the assessment 
two years prior to the year in which the aid is payable.  The 
adjustment factor cannot be less than one.  Estimates of market 
value for the assessment one year prior to the year in which the 
aid is paid will be made on the basis of the abstract submitted 
pursuant to section 270.11.  Discrepancies between the estimate 
and actual market values will not result in increased or 
decreased aid in the year in which the estimates are used to 
compute aid. 
    (k) (l) "Cost-of-living adjustment factor" means the 
greater of one or one plus the percentage increase in the 
consumer price index minus .36 percent.  In no case may the cost 
of living adjustment factor exceed 1.0394.  
    (m) The percentage increase in the consumer price index 
means the percentage, if any, by which: 
    (1) the consumer price index for the calendar year 
preceding that in which aid is payable, exceeds 
    (2) the consumer price index for calendar year 1989.  
    (l) (n) "Consumer price index for any calendar year" means 
the average of the consumer price index as of the close of the 
12-month period ending on May 31 of such calendar year.  
    (m) (o) "Consumer price index" means the last consumer 
price index for all-urban consumers published by the department 
of labor.  For purposes of the preceding sentence, the revision 
of the consumer price index which is most consistent with the 
consumer price index for calendar year 1989 shall be used. 
    (n) (p) "Household adjustment factor" means the number of 
households for the second most recent year preceding that in 
which the aids are payable divided by the 1988 number of 
households for the third most recent year.  The household 
adjustment factor cannot be less than one.  
    (q) "Growth adjustment factor" means the household 
adjustment factor in the case of counties, cities, and towns.  
In the case of school districts the growth adjustment factor 
means the average daily membership of the school district under 
section 124.17, subdivision 2, for the school year ending in the 
second most recent year preceding that in which the aids are 
payable divided by the average daily membership for the third 
most recent year.  In the case of special taxing districts, the 
growth adjustment factor equals one.  The household growth 
adjustment factor cannot be less than one.  
    (r) "Homestead and agricultural credit base" means the 
previous year's certified homestead and agricultural credit aid 
determined under subdivision 2 plus, for aid payable in 1992, 
fiscal disparity homestead and agricultural credit aid under 
subdivision 2b. 
    (s) "Net tax capacity adjustment" means (1) the total 
previous net tax capacity minus the total net tax capacity, 
multiplied by (2) the unique taxing jurisdiction's current local 
tax rate.  The net tax capacity adjustment cannot be less than 
zero. 
    (t) "Fiscal disparity adjustment" means the difference 
between (1) a taxing jurisdiction's fiscal disparity 
distribution levy under section 473F.08, subdivision 3, clause 
(a), for taxes payable in the year prior to that for which aids 
are being calculated, and (2) the same distribution levy 
multiplied by the ratio of the highest class rate for class 3 
property for taxes payable in the year prior to that for which 
aids are being calculated to the highest class rate for class 3 
property for taxes payable in the second prior year to that for 
which aids are being calculated.  In the case of school 
districts, the fiscal disparity distribution levy shall exclude 
that part of the levy attributable to equalized school levies as 
defined in subdivision 2a. 
    Sec. 3.  Minnesota Statutes Second 1989 Supplement, section 
273.1398, subdivision 2, is amended to read: 
    Subd. 2.  [HOMESTEAD AND AGRICULTURAL CREDIT AID.] (a) 
Initial For aid payable in 1991, homestead and agricultural 
credit aid for each unique taxing jurisdiction equals the total 
gross taxes levied on all properties, minus the unique taxing 
jurisdiction's subtraction factor.  The commissioner of revenue 
may, in computing the amount of the homestead and agricultural 
credit aid paid in 1990 and subsequent years, adjust the gross 
tax capacity, net tax capacity, and gross taxes of a taxing 
jurisdiction for taxes payable in 1989 to reflect auditor's 
errors in computing taxes payable for 1989 in unique taxing 
jurisdictions within independent school district Nos. 720 and 
792.  Homestead and agricultural credit aid cannot be less than 
zero.  
    (b)(1) The 1990 and 1991 homestead and agricultural credit 
aid is allocated to each local government levying taxes in the 
unique taxing jurisdiction in the proportion that the local 
government's gross taxes bears to the total gross taxes levied 
within the unique taxing jurisdiction.  The net tax capacity 
adjustment is allocated to each local government levying taxes 
in the unique taxing jurisdiction in the proportion that the 
local government's taxes levied bears to the total taxes levied 
in the unique taxing jurisdiction.  
    (2) The 1990 homestead and agricultural credit aid so 
determined for school districts for purposes of general 
education levies pursuant to section 124A.23, subdivisions 2 and 
2a, and transportation levies pursuant to section 275.125, 
subdivisions 5 and 5c, shall be multiplied by the ratio of the 
adjusted gross tax capacity based upon the 1988 adjusted gross 
tax capacity to the estimated 1987 adjusted gross tax capacity 
based upon the 1987 adjusted assessed value. 
    (3) If a local government's total tax capacity rate for all 
funds for taxes payable in 1989 varies within the area in which 
it exercises taxing authority, the local government's allocated 
homestead and agricultural credit aid must be further allocated 
between the part of its levy in respect to which the tax 
capacity rate is constant throughout the area in which it 
exercises taxing authority and the part of its levy in respect 
to which the tax capacity rate varies throughout the area in 
which it exercises taxing authority.  
    (c) The calendar year 1990 homestead and agricultural 
credit aid shall be adjusted by the adjustment factor. 
    (d) Payments under this subdivision to counties in 1990 and 
subsequent years and 1991 shall be reduced by the amount 
provided in section 477A.012, subdivisions 3, paragraph (d), and 
4, paragraph (d), and 5. 
    (e) Payments under this subdivision to cities and towns in 
1990 and 1991 shall be annually reduced by the amount of the 
homestead and agricultural credit aid adjustment, if any, 
determined for 1990 under section 477A.013, subdivision 6. 
    (f) Payments under this subdivision to cities in 1990 and 
1991 shall be reduced by the amount of the homestead and 
agricultural credit aid adjustment, if any, determined for 1990 
under section 477A.013, subdivisions 6 and 7. 
    (g) Payments under this subdivision to special taxing 
districts, excluding hospital districts and the regional transit 
board defined in section 473.373, in 1990 and 1991 shall be 
reduced by an amount equal to 2.35 percent of the amount levied 
for taxes payable in 1990, before reduction for homestead and 
agricultural credit aid and disparity reduction aid.  Payments 
under this subdivision to the regional transit board in 1990 and 
1991 shall be reduced by $450,000.  
    (h) Payments under this subdivision to all taxing 
jurisdictions in 1992 and subsequent years are equal to the 
product of (1) the homestead and agricultural credit aid base, 
and (2) the growth adjustment factor, plus the net tax capacity 
adjustment and the fiscal disparity adjustment.  
    Sec. 4.  Minnesota Statutes 1988, section 273.1398, is 
amended by adding a subdivision to read:  
    Subd. 2c.  [COMPUTATION BY COMMISSIONER.] Notwithstanding 
the provisions of subdivisions 1 and 2 requiring the computation 
of homestead and agricultural credit aid at the unique taxing 
jurisdiction level, the commissioner may, upon consultation with 
the chairs of the house tax committee and senate committee on 
taxes and tax laws, compute homestead and agricultural credit 
aid at a higher level if it would have a negligible impact or if 
changes in the composition of unique taxing jurisdictions do not 
permit computation at the unique taxing jurisdiction level.  
    Sec. 5.  Minnesota Statutes Second 1989 Supplement, section 
275.07, subdivision 3, is amended to read: 
    Subd. 3.  The county auditor shall adjust each local 
government's levy certified under subdivision 1 by the amount of 
homestead and agricultural credit aid certified by section 
273.1398, subdivision 2, reduced by the amount under section 
273.1398, subdivision 5a,; fiscal disparity homestead and 
agricultural credit aid under section 273.1398, subdivision 2b; 
and equalization aid certified by section 477A.013, subdivision 
5.  If a local government's homestead and agricultural credit 
aid was further allocated between portions of its levy pursuant 
to section 273.1398, subdivision 2, paragraph (b)(2), the levy 
or fund to which the homestead and agricultural credit aid was 
allocated is the levy or fund which must be adjusted. 
    Sec. 6.  Minnesota Statutes Second 1989 Supplement, section 
477A.011, subdivision 1a, is amended to read: 
    Subd. 1a.  [CITY.] City means a statutory or home rule 
charter city.  City also means a town having a population of 
5,000 or more for purposes of the aid payable under section 
477A.013, subdivision 3.  Towns and cities of the first class 
are not eligible to be treated as cities for purposes of aid 
payable under section 477A.013, subdivision 5 or the aid 
adjustment under section 477A.013, subdivision 7. 
    Sec. 7.  Minnesota Statutes Second 1989 Supplement, section 
477A.011, subdivision 25, is amended to read: 
    Subd. 25.  [NET TAX CAPACITY.] "Net tax capacity" means for 
aids payable under section 477A.013, subdivision 5, (1) the net 
tax capacity of a city computed using the net tax capacity class 
rates in Minnesota Statutes 1988, section 273.13, for taxes 
payable the year prior to the aid distribution, and based on 
1988 estimated market values for taxes payable the year prior to 
the aid distribution, plus (2) a city's fiscal disparities 
distribution tax capacity under section 473F.08, subdivision 2, 
paragraph (b), for taxes payable in 1989 the year prior to the 
aid distribution.  The market value utilized in computing net 
tax capacity shall be reduced by the sum of (1) a city's market 
value of commercial industrial property as defined in section 
473F.02, subdivision 3, multiplied by the ratio determined 
pursuant to section 473F.08, subdivision 2, paragraph 
(a), and (2) the market value of the captured value of tax 
increment financing districts as defined in section 469.177, 
subdivision 2, and (3) the market value of transmission lines 
deducted from a city's total net tax capacity under section 
273.425.  The net tax capacity will be computed using equalized 
market values.  
    Sec. 8.  Minnesota Statutes 1988, section 477A.011, is 
amended by adding a subdivision to read: 
    Subd. 27.  [REVENUE BASE.] "Revenue base" means the amount 
levied for taxes payable in 1990 less the special levies under 
section 275.50, subdivision 5, clause (u), including the levy on 
the fiscal disparity distribution under section 473F.08, 
subdivision 3, paragraph (a), and before reduction for the 
homestead and agricultural credit aid under section 273.1398, 
subdivision 2, equalization aid under section 477A.013, 
subdivision 5, and disparity reduction aid under section 
273.1398, subdivision 3; plus the local government aid under 
sections 477A.011; 477A.012, subdivisions 1 and 3, determined 
without regard to subdivision 2; and 477A.013, subdivisions 3 
and 6; and the estimated taconite aids used to determine levy 
limits for taxes payable in 1990 under section 275.51, 
subdivision 3i. 
    Sec. 9.  Minnesota Statutes 1988, section 477A.011, is 
amended by adding a subdivision to read:  
    Subd. 28.  [REDUCTION PERCENTAGE.] "Reduction percentage" 
is the equal percentage reduction in each county and city 
revenue base that is necessary to reduce 1990 aid payments by 
$28,000,000 under sections 477A.012, subdivision 5 and 477A.013, 
subdivision 7. 
    Sec. 10.  Minnesota Statutes 1988, section 477A.012, 
subdivision 1, is amended to read: 
    Subdivision 1.  [AID AMOUNT.] In calendar year 1988 and 
calendar years thereafter 1990, each county government shall 
receive a distribution equal to the aid amount certified for 
1987 pursuant to this subdivision.  In calendar year 1991 and 
subsequent years, each county government shall receive a 
distribution equal to the aid amount it received in 1990 under 
this subdivision less the reduction made under subdivision 5. 
    Sec. 11.  Minnesota Statutes 1988, section 477A.012, is 
amended by adding a subdivision to read: 
    Subd. 5.  [COUNTY AID ADJUSTMENT.] For calendar year 1990, 
a county's aid amount as calculated under subdivisions 1 and 3 
is reduced by an amount equal to the product of its revenue base 
and the reduction percentage.  The amount of aid computed under 
this subdivision and subdivisions 1 and 3 cannot be less than 
$0.  If the subtraction amount under this subdivision is greater 
than the amount of aid calculated for any county under 
subdivisions 1 and 3, the remaining amount shall be next 
subtracted from the county's homestead and agricultural credit 
aid under section 273.1398, subdivision 2, and then, if 
necessary, from the county's disparity reduction aid under 
section 273.1398, subdivision 3. 
    Sec. 12.  Minnesota Statutes Second 1989 Supplement, 
section 477A.013, subdivision 3, is amended to read:  
    Subd. 3.  [CITY AID DISTRIBUTION.] In 1989, a city whose 
initial aid is greater than $0 will receive the following aid 
increases in addition to an amount equal to the local government 
aid it received in 1988 under Minnesota Statutes 1987 
Supplement, section 477A.013: 
    (1) for a city whose expenditure/unlimited aid ratio is at 
least 1.5, two percent of city revenue; 
    (2) for a city whose expenditure/unlimited aid ratio is at 
least 1.4 but less than 1.5, 2.5 percent of city revenue; 
    (3) for a city whose expenditure/unlimited aid ratio is at 
least 1.3 but less than 1.4, three percent of city revenue; 
    (4) for a city whose expenditure/unlimited aid ratio is at 
least 1.2 but less than 1.3, four percent of city revenue; 
    (5) for a city whose expenditure/unlimited aid ratio is at 
least 1.1 but less than 1.2, five percent of city revenue; 
    (6) for a city whose expenditure/unlimited aid ratio is at 
least 1.05 but less than 1.1, six percent of city revenue; 
    (7) for a city whose expenditure/unlimited aid ratio is at 
least 1.0 but less than 1.05, seven percent of city revenue; 
    (8) for a city whose expenditure/unlimited aid ratio is at 
least .95 but less than 1.0, 7.5 percent of city revenue; 
    (9) for a city whose expenditure/unlimited aid ratio is at 
least .75 but less than .95, 8.5 percent of city revenue; and 
    (10) for a city whose expenditure/unlimited aid ratio is 
less than .75, nine percent of city revenue.  
    In 1990, a city whose initial aid is greater than $0 will 
receive an amount equal to the aid it received under this 
section in the year prior to that for which aids are being 
calculated plus an aid increase equal to 50 percent of the rates 
listed in clauses (1) to (10) multiplied by city revenue. 
    In 1991 and subsequent years, a city whose initial aid is 
greater than $0 will receive an amount equal to the aid it 
received under this section in the year prior to that for which 
aids are being calculated plus an aid increase equal to 25 
percent of the rates listed in clauses (1) to (10) multiplied by 
city revenue.  
    In 1991 and subsequent years, a city will receive an amount 
equal to the local government aid it received under this section 
in the previous year. 
    A city's aid increase under this subdivision is limited to 
the lesser of (1) 20 percent of its levy for taxes payable in 
the year prior to that for which aids are being calculated after 
the adjustments provided in section 273.1398, subdivision 2, or 
(2) its initial aid amount, or (3) 15 percent of the total local 
government aid amount received under this section in the 
previous year, provided that no city will receive an increase 
that is less than two percent of its 1989 local government aid 
for aids payable in 1990. 
    A city whose initial aid is $0 will receive in 1990 an 
amount equal to 102 percent of the local government aid it 
received in 1989 under Minnesota Statutes 1988, section 
477A.013.  A city whose initial aid is $0 will receive in 1991 
and subsequent years an amount equal to the aid it received in 
the previous year under this section.  For purposes of this 
subdivision, the term "local government aid" includes does not 
include equalization aid for aids payable in 1991 and thereafter 
amounts under subdivision 5. 
    Sec. 13.  Minnesota Statutes Second 1989 Supplement, 
section 477A.013, subdivision 5, is amended to read: 
    Subd. 5.  [EQUALIZATION AID.] A city is eligible for 
equalization aid in 1990 only.  The amount of the aid is equal 
to (1) the aid amount received under this subdivision in 1990 
after the adjustments, if any, under subdivisions 6 and 7, plus 
an equalization aid increase equal to the product of (i) a 
city's average levy for the three immediately preceding years 
less the disparity reduction aids allocated to the city pursuant 
to Minnesota Statutes 1988, section 273.1398, subdivision 3, for 
the year prior to the aid distribution, and less the 
equalization aid it received under this section in the year 
prior to that for which the aid is being 
calculated, (ii) .36 .30, and (iii) one minus the ratio of the 
net tax capacity per capita to 900; less (2) the local 
government aid increase for the city under subdivision 3.  The 
equalization aid increase under this section is limited to 15 12 
percent of the total local government aid the city received in 
1989 under this section in the prior year.  The aid under this 
section cannot be less than zero.  For the purposes of this 
subdivision, "levy" includes a city's levy on fiscal disparities 
distribution under section 473F.08, subdivision 3, paragraph (a).
    If the amount allocated under section 477A.03, subdivision 
1, is insufficient to pay the aid amounts calculated under this 
subdivision, the commissioner of revenue shall first 
proportionately reduce the equalization aid increase for each 
city so that the sum of the equalization aid amounts paid under 
this subdivision equals the amount allocated in section 477A.03, 
subdivision 1.  If the equalization aid increase is reduced to 
zero and the amount allocated under section 477A.03, subdivision 
1, is still insufficient to pay the aid amounts under this 
subdivision, the remaining amount of equalization aid for each 
city will be reduced proportionately so that the sum of the aid 
paid under this subdivision equals the amount allocated in 
section 477A.03, subdivision 1. 
    Sec. 14.  Minnesota Statutes 1988, section 477A.013, is 
amended by adding a subdivision to read: 
    Subd. 7.  [1990 CITY AID ADJUSTMENT.] For cities only in 
calendar year 1990, there shall be an amount, equal to the 
product of a city's revenue base and the reduction percentage, 
subtracted from the aid amounts computed under subdivisions 3, 
5, and 6.  The subtraction will be made first from the local 
government aid computed under subdivisions 3 and 6.  If the 
subtraction amount under this subdivision is greater than the 
local government aid computed under subdivisions 3 and 6, the 
remaining amount will be subtracted from the equalization aid 
computed under subdivisions 5 and 6.  The resulting amounts 
shall be the city's local government aid and equalization aid 
for calendar year 1990.  The local government aid and 
equalization aid amount for any city cannot be less than zero.  
If the subtraction amount under this section is greater than the 
aid amount for any city computed under subdivisions 3, 5, and 6, 
the remaining amount shall be subtracted next from the city's 
homestead and agricultural credit aid under section 273.1398, 
subdivision 2, and then, if necessary, from the city's disparity 
reduction aid under section 273.1398, subdivision 3. 
    Sec. 15.  Minnesota Statutes 1988, section 477A.03, 
subdivision 1, is amended to read:  
    Subdivision 1.  [ANNUAL APPROPRIATION.] A sum sufficient to 
discharge the duties imposed by sections 477A.011 to 477A.014 is 
annually appropriated from the general fund to the commissioner 
of revenue.  For aids payable in 1991 and thereafter, the total 
amount of equalization aid paid under section 477A.013, 
subdivision 5, is limited to $19,485,684. 
    Sec. 16.  Minnesota Statutes 1988, section 477A.11, 
subdivision 4, is amended to read: 
    Subd. 4.  "Other natural resources land" means:  
    (1) any other land presently owned in fee title by the 
state and administered by the commissioner, or any tax-forfeited 
land, other than platted lots within a city, which is owned by 
the state and administered by the commissioner or by the county 
in which it is located; and 
    (2) land leased by the state from the United States of 
America through the United States Secretary of Agriculture 
pursuant to Title III of the Bankhead Jones Farm Tenant Act, 
which land is commonly referred to as land utilization project 
land that is administered by the commissioner. 
    Sec. 17.  Minnesota Statutes 1988, section 477A.13, is 
amended to read: 
    477A.13 [TIME OF PAYMENT, DEDUCTIONS.] 
    Payments to the counties shall be made from the general 
fund during the month of July of the year next following 
certification.  There shall be deducted from amounts paid any 
amounts paid to a county or township during the preceding year 
pursuant to sections 89.036, 97A.061, subdivisions 1 and 2, and 
272.68, subdivision 3 with respect to the lands certified 
pursuant to section 477A.12.  
    Payments under section 477A.12 must also be reduced by the 
following percentages of the amounts paid during the preceding 
year under section 84A.51:  
    (1) for the payment made July 15, 1984, 75 percent; 
    (2) for the payment made July 15, 1985, 50 percent; 
    (3) for the payment made July 15, 1986, 25 percent; and 
    (4) for the payment made thereafter, 0 percent. 
    Sec. 18.  [SPECIAL TAXING DISTRICTS; HOMESTEAD AND 
AGRICULTURAL CREDIT AID REDUCTION.] 
    Subdivision 1.  [APPLICATION.] This section applies only to 
special taxing districts receiving payments of homestead and 
agricultural credit aid for taxes payable in 1990 of $150,000 or 
more.  The section applies only to the homestead and 
agricultural aid payments for taxes payable in 1990. 
    Subd. 2.  [DEFINITIONS.] For purposes of this section, the 
following terms have the meanings given. 
    (a) "Budget" means the budget adopted by the special taxing 
district to determine its levy for property taxes payable in 
1990.  It includes changes in the budget formally adopted by the 
governing body of the district before March 15, 1990. 
    (b) "General fund" means the general fund or equivalent 
current operating fund of the special taxing district.  It does 
not include a separate fund to pay for capital improvements and 
equipment or other capital costs. 
    (c) "Projected unreserved fund balance" means for the 
district's general fund the sum of the balance at the end of 
1989 and the projected revenues for 1990 in its budget, less the 
budgeted amount of current, general fund expenditures for 1990.  
Current expenditures include budgeted payments to other public 
agencies or entities for their operations to the extent that the 
source of the payment is derived 25 percent or more from the 
district's property tax levy.  Federal aid or other nonproperty 
tax revenues (other than homestead and agricultural credit aid) 
must be excluded from computation of the unreserved fund 
balance, if the revenues are passed through or paid to another 
entity and the expenditures are also excluded. 
    (d) "Special taxing district" or "district" means a 
political subdivision with the authority to levy property taxes, 
other than a city, county, or school district. 
    Subd. 3.  [REPORTING OF RESERVE FUNDS.] By May 15, 1990, 
each special taxing district must report to the commissioner of 
revenue the following amounts:  (1) its projected unreserved 
fund balance, (2) the revenues to be derived from its property 
tax levy and homestead and agricultural credit aid for taxes 
payable in 1990, and (3) the general fund expenditures 
authorized by its budget for 1990. 
    Subd. 4.  [REDUCTION IN AID PAYMENTS.] The commissioner 
shall reduce the homestead and agricultural credit aid payments 
in calendar year 1990 to the district by the amount of the 
excess of the projected unreserved fund balance, over the 
greater of (1) 50 percent of its levy before reduction for 
homestead and agricultural credit aid and disparity reduction 
aid or (2) 20 percent of its general fund expenditures 
authorized by its 1990 budget.  If the commissioner calculates 
that the sum of the reductions under this subdivision for all 
districts exceeds $4,000,000, the commissioner shall 
proportionately reduce the amount for each district so that the 
total reduction is $4,000,000. 
    Sec. 19.  [FURTHER REDUCTIONS IN AIDS AND CREDITS.] 
    If the total of the reductions in aids and credits under 
this article and article 5 for fiscal year 1993 is not at least 
$175,000,000, the commissioner of revenue shall further reduce 
state aids payable to cities, counties, and special taxing 
districts by an amount that, when added to the other reductions 
of aids and credits under this article, will equal 
$175,000,000.  Reductions under this section will be made in the 
manner provided in sections 3, 11, and 14. 
    Sec. 20.  [LEVY USE FOR REDUCTIONS.] 
    If the 1990 abstract of tax lists for a county, city, or 
special taxing district has not been received by the 
commissioner of revenue by June 15, 1990, the commissioner may 
use the final levy certified in the report filed under section 
275.07, subdivision 4, as a basis for the reduction under 
section 3, 11, or 14.  
    Sec. 21.  [REPEALER.] 
    Minnesota Statutes Second 1989 Supplement, section 
273.1398, subdivision 2b, is repealed.  
    Sec. 22.  [EFFECTIVE DATES.] 
    Sections 1, 3, 8, 9, 11, 14, 18, and 20 are effective for 
aids payable in calendar year 1990 and thereafter.  Sections 2, 
4, 5, 7, 10, 12, 13, 15, and 17 are effective for aids payable 
in calendar year 1991 and thereafter.  Sections 19 and 21 are 
effective for aids payable in calendar year 1992 and 
thereafter.  That part of section 6 striking a reference to 
cities of the first class is effective for aids paid in calendar 
year 1991 and thereafter.  The rest of section 6 is effective 
for aids paid in calendar year 1990 and thereafter.  Section 16 
is effective July 1, 1990, and applies to payments due on or 
after that date. 

                               ARTICLE 5 

                          PROPERTY TAX REFUNDS 
    Section 1.  Minnesota Statutes 1988, section 290A.03, 
subdivision 11, is amended to read: 
    Subd. 11.  [RENT CONSTITUTING PROPERTY TAXES.] "Rent 
constituting property taxes" means the amount of gross rent 
actually paid in cash, or its equivalent, which is attributable 
(a) to the property tax paid on the unit or (b) to the amount 
paid in lieu of property taxes, in any calendar year by a 
claimant for the right of occupancy of the claimant's Minnesota 
homestead in the calendar year, and which rent constitutes the 
basis, in the succeeding calendar year of a claim for relief 
under this chapter by the claimant.  The amount of rent 
attributable to property taxes paid or payments in lieu made on 
the unit shall be determined by multiplying the net tax on the 
property where gross rent paid by the claimant for the calendar 
year for the unit is located by a fraction, the numerator of 
which is the gross rent paid by the claimant for the calendar 
year for net tax on the property where the unit is located and 
the denominator of which is the gross rent paid for the calendar 
year for the property in which the unit is located total 
scheduled rent.  In no case may the rent constituting property 
taxes exceed 50 percent of the gross rent paid by the claimant 
during that calendar year.  In the case of a claimant who 
resides in a unit for which (1) a rent subsidy is paid to, or 
for, the claimant based on the income of the claimant or the 
claimant's family, or (2) a subsidy is paid to a public housing 
authority that owns or operates the claimant's rental unit, 
pursuant to United States Code, title 42, section 1437c, 20 
percent of gross rent actually paid in cash or its equivalent 
shall be the claimant's "rent constituting property taxes 
paid."  For purposes of this subdivision, "rent subsidy" does 
not include any housing assistance received under aid to 
families with dependent children, general assistance, Minnesota 
supplemental assistance, supplemental security income, or 
similar income maintenance programs. 
    Sec. 2.  Minnesota Statutes 1988, section 290A.03, is 
amended by adding a subdivision to read: 
    Subd. 12a.  [TOTAL SCHEDULED RENT.] "Total scheduled rent" 
means the sum of the monthly rents assigned to the residential 
rental units in the property multiplied by 12.  The assigned 
rents are the rents effective on May 3 for taxes payable in 1990 
and April 15 for taxes payable in 1991 and thereafter.  The 
rents must be an arm's-length rental, including garage rents if 
any, but not including charges for medical services furnished by 
the landlord as a part of the rental agreement.  In determining 
total scheduled rent, no deduction is allowed for vacant units, 
uncollected rent, or reduced cash rents in units occupied by 
employees or agents of the owner. 
    Sec. 3.  Minnesota Statutes Second 1989 Supplement, section 
290A.04, subdivision 2a, is amended to read: 
    Subd. 2a.  [RENTERS.] A claimant whose rent constituting 
property taxes exceeds the percentage of the household income 
stated below must pay an amount equal to the percent of income 
shown for the appropriate household income level along with the 
percent to be paid by the claimant of the remaining amount of 
rent constituting property taxes.  The state refund equals the 
amount of rent constituting property taxes that remain, up to 
the maximum state refund amount shown below.  
                        Percent           Percent    Maximum
Household Income       of Income          Paid by     State
                                          Claimant    Refund
    $0 to 999         1.0 percent         9 percent  $1,000
 1,000 to 1,999       1.1 1.0 percent         9 percent  $1,000
 2,000 to 2,999       1.2 1.0 percent        10 percent  $1,000
 3,000 to 3,999       1.3 1.0 percent        10 percent  $1,000
 4,000 to 4,999       1.4 1.1 percent        11 percent  $1,000
 5,000 to 5,999       1.5 1.2 percent        12 percent  $1,000
 6,000 to 6,999       1.5 1.2 percent        13 percent  $1,000
 7,000 to 7,999       1.6 1.3 percent        14 percent  $1,000
 8,000 to 8,999       1.6 1.3 percent        15 percent  $1,000
 9,000 to 9,999       1.7 1.4 percent        16 percent  $1,000
10,000 to 10,999      1.7 1.4 percent        17 percent  $1,000
11,000 to 11,999      1.8 1.5 percent        19 percent  $1,000
12,000 to 12,999      1.8 1.5 percent        21 percent  $1,000
13,000 to 13,999      1.9 1.6 percent        23 percent  $1,000
14,000 to 14,999      2.0 1.7 percent        24 percent  $1,000
15,000 to 15,999      2.0 1.8 percent        26 percent  $1,000
16,000 to 16,999      2.1 1.8 percent        27 percent  $1,000
17,000 to 17,999      2.2 1.9 percent        28 percent  $1,000
18,000 to 18,999      2.3 2.0 percent        30 percent  $1,000
19,000 to 19,999      2.5 2.2 percent        32 percent  $1,000
20,000 to 20,999      2.7 2.4 percent        34 percent  $1,000
21,000 to 21,999      2.9 2.6 percent        36 percent  $1,000
22,000 to 22,999      3.0 2.7 percent        37 percent  $1,000
23,000 to 23,999      3.1 2.8 percent        38 percent  $1,000
24,000 to 24,999      3.2 2.9 percent        40 percent  $1,000
25,000 to 25,999      3.3 3.0 percent        43 percent  $1,000
26,000 to 26,999      3.4 3.1 percent        43 percent  $1,000
27,000 to 27,999      3.5 3.2 percent        45 percent  $1,000
28,000 to 28,999      3.6 3.3 percent        47 percent  $  900
29,000 to 29,999      3.7 3.4 percent        47 percent  $  800
30,000 to 30,999      3.8 3.5 percent        48 percent  $  700
31,000 to 31,999      3.9 3.5 percent        48 percent  $  600
32,000 to 32,999      4.0 3.5 percent        50 percent  $  500
33,000 to 33,999      4.0 3.5 percent        50 percent  $  300
34,000 to 34,999      4.0 3.5 percent        50 percent  $  100
    The payment made to a claimant is the amount of the state 
refund calculated under this subdivision.  No payment is allowed 
if the claimant's household income is $35,000 or more. 
    Sec. 4.  Minnesota Statutes Second 1989 Supplement, section 
290A.04, subdivision 2h, is amended to read: 
    Subd. 2h.  (a) If the gross property taxes payable on a 
homestead increase more than ten percent over the net property 
taxes payable in the prior year on the same property that is 
owned by the same owner in both years, and the amount of that 
increase is $40 or more for taxes payable in 1990 and 1991, $60 
or more for taxes payable in 1992, $80 or more for taxes payable 
in 1993, and $100 or more for taxes payable in 1994, a claimant 
who is a homeowner shall be allowed an additional refund equal 
to the sum of (1) 75 percent of the first $250 of the amount of 
the increase over ten percent for taxes payable in 1990 and 
1991, 75 percent of the first $275 of the amount of the increase 
over ten percent for taxes payable in 1992, 75 percent of the 
first $300 of the amount of the increase over ten percent for 
taxes payable in 1993, and 75 percent of the first $325 of the 
amount of the increase over ten percent for taxes payable in 
1994, and (2) 90 percent of the amount of the increase over ten 
percent plus $250 for taxes payable in 1990 and 1991, 90 percent 
of the amount of the increase over ten percent plus $275 for 
taxes payable in 1992, 90 percent of the amount of the increase 
over ten percent plus $300 for taxes payable in 1993, and 90 
percent of the amount of the increase over ten percent plus $325 
for taxes payable in 1994.  This subdivision shall not apply to 
any increase in the net property taxes payable attributable to 
improvements made to the homestead. 
    (b) For purposes of this subdivision, the following terms 
have the meanings given: 
    (1) "Net property taxes payable" means property taxes 
payable after reductions made under sections 273.13, 
subdivisions 22 and 23; 273.132; 273.135; 273.1391; and 273.42, 
subdivision 2, and any other state paid property tax credits and 
after the deduction of tax refund amounts for which the claimant 
qualifies pursuant to subdivision 2 and this subdivision.  
    (2) "Gross property taxes" means net property taxes payable 
determined without regard to the refund allowed under this 
subdivision. 
    (c) In addition to the other proofs required by this 
chapter, each claimant under this subdivision shall file with 
the property tax refund return a copy of the property tax 
statement for taxes payable in the preceding year or other 
documents required by the commissioner. 
    On or before December 1, 1990, and December 1 of each of 
the following three years, the commissioner shall estimate the 
cost of making the payments provided by this subdivision for 
taxes payable in the following year.  Notwithstanding the open 
appropriation provision of section 290A.23, if the estimated 
total refund claims exceed the following amounts for the taxes 
payable year designated, the commissioner shall decrease the 
percentages of the excess taxes the state will pay and increase 
the dollar amount of tax increase which must occur before a 
taxpayer qualifies for a refund so that the estimated total 
refund claims do not exceed the appropriation limit. 
     Taxes payable in:         Appropriation limit
       1991                      $7,000,000 $13,000,000
       1992                      $6,500,000
       1993                      $6,000,000
       1994                      $5,500,000
    The commissioner shall make the adjustments so that half of 
the estimated savings come from decreasing the percentages of 
the excess taxes the state will pay and half of the estimated 
savings come from increasing the dollar amount of the tax 
increase which must occur before a taxpayer qualifies for a 
refund.  The determinations of the revised percentages and 
thresholds by the commissioner are not rules subject to chapter 
14. 
    Sec. 5.  Minnesota Statutes 1989 Supplement, section 
290A.04, subdivision 5, is amended to read: 
    Subd. 5.  [COMBINED RENTER AND HOMEOWNER REFUND.] In the 
case of a claimant who is entitled to a refund in a calendar 
year for claims based both on rent constituting property taxes 
and property taxes payable, the refund allowable equals the sum 
of the refunds allowable, except that the sum may not exceed the 
higher of the maximum refund payable either based on rent 
constituting property taxes or property taxes payable. 
    Sec. 6.  Minnesota Statutes 1988, section 290A.19, is 
amended to read: 
    290A.19 [OWNER OR MANAGING AGENT TO FURNISH RENT 
CERTIFICATE; PENALTY.] 
    (a) The owner or managing agent of any property for which 
rent is paid for occupancy as a homestead shall furnish a 
certificate of rent constituting property tax to each person who 
is a renter on December 31, in the form prescribed by the 
commissioner.  If the renter moves prior to December 31, the 
owner or managing agent has the option to either provide the 
certificate to the renter at the time of moving, or mail the 
certificate to the forwarding address if an address has been 
provided by the renter.  The certificate shall be made available 
to the renter not later than January 31 of the year following 
the year in which the rent was paid.  The owner or managing 
agent must retain a duplicate of each certificate or an 
equivalent record showing the same information for a period of 
three years.  The duplicate or other record must be made 
available to the commissioner upon request. 
    (b) Any owner or managing agent who willfully fails to 
furnish a certificate to the renter and the commissioner as 
required by this section is liable to the commissioner for a 
penalty of $100 for each act or failure to act.  The penalty 
shall be assessed and collected in the manner provided in 
chapter 290 for the assessment and collection of income tax.  If 
the owner or managing agent willfully furnishes certificates 
that report total rent constituting property taxes in excess of 
the amount of actual property taxes paid on the rented part of a 
property, as determined under this section, the owner or 
managing agent is liable for a penalty equal to the greater of 
(1) $100 or (2) 50 percent of the excess that is reported.  If 
the owner or managing agent reports a total amount of rent 
constituting property taxes that exceeds by ten percent or more 
the actual property taxes, the report is deemed to be willful. 
    (c) If the owner or managing agent elects to provide the 
renter with the certificate at the time of moving, rather than 
after December 31, the amount of rent constituting property 
taxes shall be computed as follows: 
    (i) The net tax shall be reduced by 1/12 for each month 
remaining in the calendar year. 
    (ii) In calculating the denominator of the fraction 
pursuant to section 290A.03, subdivision 11, the gross rent paid 
through the last month of claimant's occupancy shall be 
substituted for "the gross rent paid for the calendar year for 
the property in which the unit is located." 
    (d) The certificate of rent constituting property taxes 
shall include the address of the property, including the county, 
and the property tax parcel identification number and any 
additional information which the commissioner determines is 
appropriate. 
    (e) (d) If the owner or managing agent fails to provide the 
renter with a certificate of rent constituting property taxes, 
the commissioner shall allocate the net tax on the building to 
the unit on a square footage basis or other appropriate basis as 
the commissioner determines.  The renter shall supply the 
commissioner with a statement from the county treasurer which 
gives the amount of property tax on the parcel, the address and 
property tax parcel identification number of the property, and 
the number of units in the building. 
    (f) The owner or managing agent must file a copy of the 
certificate of rent paid with the commissioner before April 15 
of the year following the year in which the rent was paid.  The 
commissioner may require that (e) By June 30, for taxes payable 
in 1990 and May 30 for taxes payable in 1991 and thereafter, 
each owner or managing agent shall report to the commissioner on 
a single form prescribed by the commissioner the total property 
taxes for a net tax pertaining to the rental residential part of 
the property and the allocation of the property taxes as rent 
constituting property taxes among the renters of the property, 
the total scheduled rent, and the fraction computed under 
section 290A.03, subdivision 11.  A copy of the property tax 
statement for taxes payable in that year must be attached. 
    Sec. 7.  [REPEALER.] 
    Minnesota Statutes Second 1989 Supplement, section 
290A.045, is repealed. 
    Sec. 8.  [EFFECTIVE DATE.] 
    Sections 1 to 3, and 6 are effective the day following 
final enactment for claims based on rent paid in 1990 and 
thereafter.  Section 4 is effective for property taxes payable 
in 1991 and thereafter.  Section 5 is effective for claims based 
on rent paid in 1990 and thereafter, and property taxes payable 
in 1991 and thereafter.  Section 7 is effective the day 
following final enactment and applies to taxes payable in 1990 
and 1991. 

                               ARTICLE 6 

                        SALES AND LODGING TAXES 
    Section 1.  Minnesota Statutes 1988, section 297A.01, 
subdivision 15, is amended to read: 
    Subd. 15.  "Farm machinery" means new or used machinery, 
equipment, implements, accessories, and contrivances used 
directly and principally in the production for sale, but not 
including the processing, of livestock, dairy animals, dairy 
products, poultry and poultry products, fruits, vegetables, 
forage, grains and bees and apiary products.  "Farm machinery"  
includes 
    (1) machinery for the preparation, seeding or cultivation 
of soil for growing agricultural crops and sod, harvesting and 
threshing of agricultural products, harvesting or mowing of sod, 
and certain machinery for dairy, livestock and poultry farms; 
    (2) barn cleaners, milking systems, grain dryers, automatic 
feeding systems and similar installations, whether or not the 
equipment is installed by the seller and becomes part of the 
real property; 
    (3) irrigation equipment sold for exclusively agricultural 
use, including pumps, pipe fittings, valves, sprinklers and 
other equipment necessary to the operation of an irrigation 
system when sold as part of an irrigation system, except 
irrigation equipment which is situated below ground and 
considered to be a part of the real property; and 
    (4) logging equipment, including chain saws used 
for commercial logging only if the engine displacement equals or 
exceeds five cubic inches; and 
    (5) primary and backup generator units used to generate 
electricity for the purpose of operating farm machinery, as 
defined in this subdivision, or providing light or space heating 
necessary for the production of livestock, dairy animals, dairy 
products, or poultry and poultry products.  
    Repair or replacement parts for farm machinery shall not be 
included in the definition of farm machinery.  
    Tools, shop equipment, grain bins, feed bunks, fencing 
material, communication equipment and other farm supplies shall 
not be considered to be farm machinery.  "Farm machinery" does 
not include motor vehicles taxed under chapter 297B, 
snowmobiles, snow blowers, lawn mowers except those used in the 
production of sod for sale, garden-type tractors or garden 
tillers and the repair and replacement parts for those vehicles 
and machines. 
    Sec. 2.  Minnesota Statutes 1988, section 297A.01, 
subdivision 16, is amended to read: 
    Subd. 16.  [CAPITAL EQUIPMENT.] Capital equipment means 
machinery and equipment and the materials and supplies necessary 
to construct or install the machinery or equipment.  To qualify 
under this definition the capital equipment must be used by the 
purchaser or lessee for manufacturing, fabricating, mining, 
quarrying, or refining a product to be sold at retail and must 
be used for the establishment of a new or the physical expansion 
of an existing manufacturing, fabricating, mining, quarrying, or 
refining facility in the state.  For purposes of this 
subdivision, "mining" includes peat mining.  Capital equipment 
does not include (1) machinery or equipment purchased or leased 
to replace machinery or equipment performing substantially the 
same function in an existing facility, (2) repair or replacement 
parts, or (3) machinery or equipment used to extract, receive, 
or store raw materials.  
    Sec. 3.  Minnesota Statutes 1988, section 297A.25, 
subdivision 36, is amended to read: 
    Subd. 36.  [INCOMING, INTERSTATE WATS LINES.] The gross 
receipts from the sale of long distance telephone services are 
exempt, if the service (1) consists of a wide area telephone 
line that permits a long distance call to an individual or 
business located in Minnesota to be made from a location outside 
of Minnesota at no toll charge to the person placing the call; 
or (2) entitles a customer, upon payment of a periodic charge 
that is determined either as a flat amount or upon the basis of 
total elapsed transmission time, to the privilege of an 
unlimited number of long distance calls made from a location in 
Minnesota to a location outside of Minnesota if the customer is 
a qualified provider of telemarketing services.  As used in this 
subdivision, a "qualified provider of telemarketing services" is 
a telemarketing firm that derives at least 80 percent of its 
revenues from one or more of the following activities:  
soliciting or providing information, soliciting sales or 
receiving orders, and conducting research by means of telegraph, 
telephone, computer data base, fiber optic, microwave, or other 
communication system. 
    Sec. 4.  Minnesota Statutes 1988, section 297A.25, is 
amended by adding a subdivision to read: 
    Subd. 45.  [SHIPS USED IN INTERSTATE COMMERCE.] The gross 
receipts from sales of repair, replacement, and rebuilding parts 
and materials, and lubricants, for ships or vessels used or to 
be used principally in interstate or foreign commerce are exempt.
    Sec. 5.  Minnesota Statutes 1988, section 297A.25, is 
amended by adding a subdivision to read: 
    Subd. 46.  [SUPERCOMPUTING COMPLEX.] The gross receipts 
from the sales, lease, license to use or consume, or other 
transfer of title or possession, or both, whether absolutely or 
conditionally, and from the storage, use, or consumption, of 
items comprising a supercomputing complex, are exempt where the 
purchaser, lessee, licensee, or other user is a corporation all 
of whose shares are owned in part by the Regents of the 
University of Minnesota and in part by the University of 
Minnesota Foundation, an organization exempt from federal 
taxation under section 501(c)(3) of the Internal Revenue Code of 
1986, as amended through December 31, 1989.  For this purpose, a 
supercomputing complex means a multi-user mainframe system 
having at least 12 linked processors, memory of at least five 
billion characters, high-speed interconnectivity, disk storage 
of at least 60 billion characters, and related system and 
application software, intended for numerically intensive 
computing.  A supercomputing complex includes, but is not 
limited to, the mainframe computers, associated software, 
processor controllers, power and coolant units, communications 
devices, workstations terminals, display stations, disk drives, 
and tape drives. 
    Sec. 6.  Minnesota Statutes Second 1989 Supplement, section 
469.190, subdivision 1, is amended to read: 
    Subdivision 1.  [AUTHORIZATION.] Notwithstanding section 
477A.016 or any other law, a statutory or home rule charter city 
may by ordinance, and a town may by the affirmative vote of the 
electors at the annual town meeting, or at a special town 
meeting, impose a tax of up to six three percent on the gross 
receipts from the furnishing for consideration of lodging at a 
hotel, motel, rooming house, tourist court, or resort, other 
than the renting or leasing of it for a continuous period of 30 
days or more.  A statutory or home rule charter city may by 
ordinance impose the tax authorized under this subdivision on 
the camping site receipts of a municipal campground.  
    Sec. 7.  Minnesota Statutes Second 1989 Supplement, section 
469.190, subdivision 2, is amended to read: 
    Subd. 2.  [EXISTING TAXES.] No statutory or home rule 
charter city or town may impose a tax under this section upon 
transient lodging that, when combined with any tax authorized by 
special law or enacted prior to 1972, exceeds a rate of six 
three percent.  
    Sec. 8.  Minnesota Statutes Second 1989 Supplement, section 
469.190, subdivision 3, is amended to read: 
    Subd. 3.  [DISPOSITION OF PROCEEDS.] Ninety-five percent of 
the gross proceeds from the first three percent of any tax 
imposed under subdivision 1 shall be used by the statutory or 
home rule charter city or town to fund a local convention or 
tourism bureau for the purpose of marketing and promoting the 
city or town as a tourist or convention center.  This 
subdivision shall not apply to any statutory or home rule 
charter city or town that has a lodging tax authorized by 
special law or enacted prior to 1972 at the time of enactment of 
this section. 
    Sec. 9.  [BLOOMINGTON LODGING TAX.] 
    Subdivision 1.  [AUTHORIZATION.] Notwithstanding Minnesota 
Statutes, section 469.190, 477A.016, or other law, in addition 
to the tax authorized in Laws 1986, chapter 391, section 4, the 
governing body of the city of Bloomington may impose a tax of up 
to one percent on the gross receipts from the furnishing for 
consideration of lodging at a hotel, motel, rooming house, 
tourist court, or resort, other than the renting or leasing of 
it for a continuous period of 30 days or more, located in the 
city.  The city may agree with the commissioner of revenue that 
a tax imposed under this section shall be collected by the 
commissioner together with the tax imposed by Minnesota 
Statutes, chapter 297A, and subject to the same interest, 
penalties, and other rules and that its proceeds, less the cost 
of collection, shall be remitted to the city.  The proceeds of 
the tax must be used to promote the metropolitan sports area 
defined in Minnesota Statutes, section 473.551, subdivision 5. 
    Subd. 2.  [EFFECTIVE DATE.] This section is effective the 
day after the filing of a certificate of local approval by the 
governing body of the city of Bloomington in compliance with 
Minnesota Statutes, section 645.021, subdivision 3. 
    Sec. 10.  [ROSEVILLE LODGING TAX.] 
    Notwithstanding Minnesota Statutes, section 477A.016, or 
other law, in addition to a tax authorized in Minnesota 
Statutes, section 469.190, the governing body of the city of 
Roseville may impose a tax of up to two percent on the gross 
receipts from the furnishing for consideration of lodging at a 
hotel, motel, rooming house, tourist court, or resort, other 
than the renting or leasing of it for a continuous period of 30 
days or more, located in the city.  The city may agree with the 
commissioner of revenue that a tax imposed under this section 
shall be collected by the commissioner together with the tax 
imposed by Minnesota Statutes, chapter 297A, and subject to the 
same interest, penalties, and other rules and that its proceeds, 
less the cost of collection, shall be remitted to the city.  The 
proceeds of the tax shall be dedicated to and used to pay the 
costs of the construction, debt service, operation, and 
maintenance of a public multiuse speed skating/bandy facility 
within the city to the extent the costs exceed any revenues 
derived from the lease, rental, or operation of the facility.  
    Sec. 11.  [EFFECTIVE DATE.] 
    Sections 1 to 3 are effective for sales after June 30, 1990.
    Section 4 is effective for sales after December 31, 1983.  
The provisions of Minnesota Statutes, section 297A.35, apply to 
refunds claimed under section 4. 
    Section 5 is effective for transactions occurring on or 
after December 1, 1989. 
    Sections 6 to 8 are effective February 1, 1990.  Any tax 
increase adopted by action of a city council after February 1, 
1990, under Minnesota Statutes, section 469.190, that results in 
a tax rate that exceeds three percent is ineffective the day 
following final enactment of this act. 
     Section 9 is effective the day following final enactment.  
     Section 10 is effective the day following final enactment, 
but only if the legislature authorizes the issuance of bonds for 
the construction of the facility during its 1990 session. 

                               ARTICLE 7 
TAX INCREMENT FINANCING 
    Section 1.  [273.1399] [REDUCTION IN STATE TAX INCREMENT 
FINANCING AID PAYMENTS.] 
    Subdivision 1.  [DEFINITIONS.] For purposes of this 
section, the following terms have the meanings given. 
    (a) "Qualifying captured tax capacity" means the following 
amounts:  
    (1) the captured tax capacity of an economic development or 
soils condition tax increment financing district for which 
certification was requested after April 30, 1990; and 
    (2) the captured tax capacity of a tax increment financing 
district, other than an economic development or soils condition 
district, for which certification was requested after April 30, 
1990, multiplied by the following percentage based on the number 
of years that have elapsed since the district was first 
certified (measured from January 2 immediately preceding 
certification of the original tax capacity).  In no case may the 
final amounts be less than zero or greater than the total 
captured tax capacity of the district.  
         Number of     Renewal and     All other 
         years         Renovation      Districts
                       Districts
         0 to 5           0                0 
            6            12.5              6.25
            7            25               12.5 
            8            37.5             18.75 
            9            50               25 
           10            62.5             31.25 
           11            75               37.5 
           12            87.5             43.75 
           13            100              50 
           14            100              56.25 
           15            100              62.5 
           16            100              68.75 
           17            100              75 
           18            100              81.25 
           19            100              87.5 
           20            100              93.75 
           21 or more    100              100 
    In the case of a hazardous substance subdistrict, the 
number of years must be measured from the date of certification 
of the subdistrict for purposes of the additional captured tax 
capacity resulting from the reduction in the subdistrict's or 
site's original tax capacity.  
    (b) The terms defined in section 469.174 have the meanings 
given in that section. 
    Subd. 2.  [REPORTING.] The county auditor shall calculate 
the qualifying captured tax capacity amount for each municipal 
part of each school district in the county and report the 
amounts to the commissioner of revenue at the time and in the 
manner prescribed by the commissioner. 
    Subd. 3.  [CALCULATION OF EDUCATION AIDS.] For each school 
district containing qualifying captured tax capacity, the 
commissioner of education shall compute a hypothetical state aid 
amount that would be paid to the school district if the 
qualifying captured tax capacity were divided by the sales ratio 
and included in the school district's adjusted tax capacity for 
purposes of calculating state aids.  The commissioner of 
education shall notify the commissioner of revenue of the 
difference between the actual aid paid and the hypothetical aid 
amounts calculated for each school district, broken down by the 
municipality that approved the tax increment financing district 
containing the qualifying captured tax capacity.  The resulting 
amount is the reduction in state tax increment financing aid. 
     Subd. 4.  [EQUALIZATION FACTOR.] The amount of the 
reduction in state tax increment financing aid equals the amount 
determined under subdivision 3 less 
    (1) seventy-five percent of the excess, if any, of the 
amount determined under subdivision 3, over 
     (2) .05 times the municipality's tax capacity, divided by 
the sales ratio.  
    Subd. 5.  [LOCAL GOVERNMENT AIDS; HOMESTEAD AND 
AGRICULTURAL AID CALCULATIONS.] (a) The reduction in state tax 
increment financing aid for a municipality must be deducted 
first from the local government aids to be paid to the 
municipality.  If the deduction exceeds the amount of the local 
government aid, the rest must be deducted from the homestead and 
agricultural credit aid to be paid to the municipality. 
    (b) The amount of qualifying captured tax capacity must be 
included in adjusted tax capacity for purposes of computing the 
local government aid of the municipality that approved the tax 
increment financing district. 
    Sec. 2.  Minnesota Statutes 1988, section 469.043, 
subdivision 5, is amended to read: 
    Subd. 5.  [CONTINUATION OF REDEVELOPMENT COMPANY 
PROVISIONS.] The provisions of Minnesota Statutes 1986, sections 
462.591 to 462.705, shall continue in effect with respect to any 
redevelopment company project to which a tax exemption had been 
granted under Minnesota Statutes 1986, section 462.651, prior to 
August 1, 1987, whether or not the project continues to be owned 
by a redevelopment company, provided that if the project is not 
owned by a redevelopment company or governmental unit, the 
exemption shall not be available during any period when the 
earnings of the owner from the project annually paid to the 
owner or its shareholders for interest, amortization, and 
dividends exceeds eight percent of invested capital or equity in 
the project. 
    Sec. 3.  Minnesota Statutes 1988, section 469.129, 
subdivision 2, is amended to read: 
    Subd. 2.  [REVENUE BONDS.] A city may authorize, issue, and 
sell revenue bonds under section 469.178, subdivision 4, to 
refund the principal of and interest on general obligation bonds 
originally issued to finance a development district, or one or 
more series of bonds one of which series was originally issued 
to finance a development district, for the purpose of relieving 
the city of restrictions on the application of tax increments or 
for other purposes authorized by law.  The refunding bonds shall 
not be subject to the conditions set out in section 475.67, 
subdivisions 11 and 12.  Tax increments received by the city 
with respect to the district may be used to pay the principal of 
and interest on the refunding bonds and to pay premiums for 
insurance or other security guaranteeing the payment of their 
principal and interest when due.  Tax increments may be applied 
in any manner permitted by section 469.176, subdivisions 2 and 4.
Bonds may not be issued under this subdivision after April 30, 
1990. 
    Sec. 4.  Minnesota Statutes Second 1989 Supplement, section 
469.174, subdivision 7, is amended to read: 
    Subd. 7.  [ORIGINAL NET TAX CAPACITY.] (a) Except as 
provided in paragraph (b), "original net tax capacity" means the 
tax capacity of all taxable real property within a tax increment 
financing district as most recently certified by the 
commissioner of revenue as of the date of the request by an 
authority for certification by the county auditor, together with 
subsequent adjustments as set forth in section 469.177, 
subdivisions 1 and 4.  In determining the original net tax 
capacity the net tax capacity of real property exempt from 
taxation at the time of the request shall be zero, except for 
real property which is tax exempt by reason of public ownership 
by the requesting authority and which has been publicly owned 
for less than one year prior to the date of the request for 
certification, in which event the net tax capacity of the 
property shall be the net tax capacity as most recently 
determined by the commissioner of revenue.  
    (b) The original net tax capacity of any designated 
hazardous substance site or hazardous substance subdistrict 
shall be determined as of the date the authority certifies to 
the county auditor that the agency or municipality authority has 
entered a redevelopment or other agreement for the removal 
actions or remedial actions specified in a development response 
action plan, or otherwise provided funds to finance the 
development response action plan.  The original net tax capacity 
equals (i) the net tax capacity of the parcel or parcels in the 
site or subdistrict, as most recently determined by the 
commissioner of revenue, less (ii) the estimated costs of the 
removal actions and remedial actions as specified in a 
development response action plan to be undertaken with respect 
to the parcel or parcels, (iii) but not less than zero. 
    (c) The original net tax capacity of a hazardous substance 
site or subdistrict shall be increased by the amount by which it 
was reduced pursuant to paragraph (b), clause (ii), upon 
certification by the municipality that the cost of the removal 
and remedial actions specified in the development response 
action plan, except for long-term monitoring and similar 
activities, have been paid or reimbursed. 
    (d) For purposes of this subdivision, "real property" shall 
include any property normally taxable as personal property by 
reason of its location on or over publicly owned property.  
    Sec. 5.  Minnesota Statutes Second 1989 Supplement, section 
469.174, subdivision 10, is amended to read: 
    Subd. 10.  [REDEVELOPMENT DISTRICT.] (a) "Redevelopment 
district" means a type of tax increment financing district 
consisting of a project, or portions of a project, within which 
the authority finds by resolution that one of the following 
conditions, reasonably distributed throughout the district, 
exists: 
    (1) parcels consisting of 70 percent of the area of the 
district are occupied by buildings, streets, utilities, or other 
improvements and more than 50 percent of the buildings, not 
including outbuildings, are structurally substandard to a degree 
requiring substantial renovation or clearance; or 
    (2) parcels consisting of 70 percent of the area of the 
district are occupied by buildings, streets, utilities, or other 
improvements and 20 percent of the buildings are structurally 
substandard and an additional 30 percent of the buildings are 
found to require substantial renovation or clearance in order to 
remove such existing conditions as:  inadequate street layout, 
incompatible uses or land use relationships, overcrowding of 
buildings on the land, excessive dwelling unit density, obsolete 
buildings not suitable for improvement or conversion, or other 
identified hazards to the health, safety, and general well-being 
of the community; or 
    (3) the property consists of vacant, unused, underused, 
inappropriately used, or infrequently used railyards, rail 
storage facilities, or excessive or vacated railroad 
rights-of-way. 
    (b) For purposes of this subdivision, "structurally 
substandard" shall mean containing defects in structural 
elements or a combination of deficiencies in essential utilities 
and facilities, light and ventilation, fire protection including 
adequate egress, layout and condition of interior partitions, or 
similar factors, which defects or deficiencies are of sufficient 
total significance to justify substantial renovation or 
clearance.  
    A building is not structurally substandard if it is in 
compliance with the building code applicable to new buildings or 
could be modified to satisfy the building code at a cost of less 
than 15 percent of the cost of constructing a new structure of 
the same square footage and type on the site.  The municipality 
may find that a building is not disqualified as structurally 
substandard under the preceding sentence on the basis of 
reasonably available evidence, such as the size, type, and age 
of the building, the average cost of plumbing, electrical, or 
structural repairs, or other similar reliable evidence.  If the 
evidence supports a reasonable conclusion that the building is 
not disqualified as structurally substandard, the municipality 
may make such a determination without an interior inspection or 
an independent, expert appraisal of the cost of repair and 
rehabilitation of the building. 
    (c) For purposes of this subdivision, a parcel is not 
occupied by buildings, streets, utilities, or other improvements 
unless 15 percent of the area of the parcel contains 
improvements. 
    (d) For districts consisting of two or more noncontiguous 
areas, each area must qualify as a redevelopment district under 
paragraph (a), clauses (1) to (3), to be included in the 
district, and the entire area of the district must satisfy 
paragraph (a). 
    Sec. 6.  Minnesota Statutes 1988, section 469.174, is 
amended by adding a subdivision to read: 
    Subd. 10a.  [RENEWAL AND RENOVATION DISTRICT.] (a) "Renewal 
and renovation district" means a type of tax increment financing 
district consisting of a project, or portions of a project, 
within which the authority finds by resolution that: 
    (1)(i) parcels consisting of 70 percent of the area of the 
district are occupied by buildings, streets, utilities, or other 
improvements; (ii) 20 percent of the buildings are structurally 
substandard; and (iii) 30 percent of the other buildings require 
substantial renovation or clearance to remove existing 
conditions such as:  inadequate street layout, incompatible uses 
or land use relationships, overcrowding of buildings on the 
land, excessive dwelling unit density, obsolete buildings not 
suitable for improvement or conversion, or other identified 
hazards to the health, safety, and general well-being of the 
community; and 
    (2) the conditions described in clause (1) are reasonably 
distributed throughout the geographic area of the district. 
    (b) For purposes of determining whether a building is 
structurally substandard, whether parcels are occupied by 
buildings or other improvements, or whether noncontiguous areas 
qualify, the provisions of subdivision 10, paragraphs (b), (c), 
and (d) apply.  
    Sec. 7.  Minnesota Statutes 1988, section 469.174, 
subdivision 11, is amended to read: 
    Subd. 11.  [HOUSING DISTRICT.] "Housing district" means a 
type of tax increment financing district which consists of a 
project, or a portion of a project, intended for occupancy, in 
part, by persons or families of low and moderate income, as 
defined in chapter 462A, Title II of the National Housing Act of 
1934, the National Housing Act of 1959, the United States 
Housing Act of 1937, as amended, Title V of the Housing Act of 
1949, as amended, any other similar present or future federal, 
state, or municipal legislation, or the regulations promulgated 
under any of those acts.  A project does not qualify under this 
subdivision if the fair market value of the improvements which 
are constructed for commercial uses or for uses other than low 
and moderate income housing consists of more than one-third 20 
percent of the total fair market value of the planned 
improvements in the development plan or agreement.  The fair 
market value of the improvements may be determined using the 
cost of construction, capitalized income, or other appropriate 
method of estimating market value. 
    Sec. 8.  Minnesota Statutes 1988, section 469.174, 
subdivision 12, is amended to read: 
    Subd. 12.  [ECONOMIC DEVELOPMENT DISTRICT.] "Economic 
development district" means a type of tax increment financing 
district which consists of any project, or portions of a 
project, not meeting the requirements found in the definition of 
redevelopment district, renewal and renovation district, soils 
condition district, mined underground space development 
district, or housing district, but which the authority finds to 
be in the public interest because: 
    (1) it will discourage commerce, industry, or manufacturing 
from moving their operations to another state or municipality; 
or 
    (2) it will result in increased employment in the 
municipality state; or 
    (3) it will result in preservation and enhancement of the 
tax base of the municipality state. 
    Sec. 9.  Minnesota Statutes 1988, section 469.174, is 
amended by adding a subdivision to read: 
    Subd. 21.  [CREDIT ENHANCED BONDS.] "Credit enhanced bonds" 
means special obligation bonds that are: 
    (1) payable primarily from tax increments (i) derived from 
a tax increment financing district within which the activity, as 
defined in section 469.1763, subdivision 1, financed by at least 
75 percent of the bond proceeds is located and (ii) estimated on 
the date of issuance to be sufficient to pay when due the debt 
service on the bonds, and 
    (2) further secured by tax increments (i) derived from one 
or more tax increment financing districts and (ii) determined by 
the issuer to be necessary in order to make the marketing of the 
bonds feasible. 
    Sec. 10.  Minnesota Statutes 1988, section 469.175, 
subdivision 1a, is amended to read: 
    Subd. 1a.  [INCLUSION OF COUNTY ROAD COSTS.] (a) The county 
board may require the authority to pay all or a portion of the 
cost of county road improvements out of increment revenues, if 
the following conditions occur: 
    (1) the proposed tax increment financing plan or an 
amendment to the plan contemplates construction of a development 
that will, in the judgment of the county, substantially increase 
the use of county roads requiring construction of road 
improvements or other road costs; and 
    (2) the proposed tax increment financing district is a 
soils condition district; and 
    (3) the road improvements or other road costs, are not 
scheduled for construction within five years under the county 
capital improvement plan or other formally adopted county plan, 
and in the opinion of the county, would not reasonably be 
expected to be needed within the reasonably foreseeable future 
if the tax increment financing plan were not implemented. 
    (b) If the county elects to use increments to finance the 
road improvements, the county must notify the authority and 
municipality within 30 days after receipt of the information on 
the proposed tax increment district under subdivision 2.  The 
notice must include the estimated cost of the road improvements 
and schedule for construction and payment of the cost.  The 
authority must include the improvements in the tax increment 
financing plan.  The improvements may be financed with the 
proceeds of tax increment bonds or the authority and the county 
may agree that the county will finance the improvements with 
county funds to be repaid in installments, with or without 
interest, out of increment revenues.  If the cost of the road 
improvements and other project costs exceed the projected amount 
of the increment revenues, the county and authority shall 
negotiate an agreement, modifying the development plan or 
proposed road improvements that will permit financing of the 
costs before the tax increment financing plan may be approved. 
    Sec. 11.  Minnesota Statutes Second 1989 Supplement, 
section 469.175, subdivision 3, is amended to read: 
    Subd. 3.  [MUNICIPALITY APPROVAL.] A county auditor shall 
not certify the original net tax capacity of a tax increment 
financing district until the tax increment financing plan 
proposed for that district has been approved by the municipality 
in which the district is located.  If an authority that proposes 
to establish a tax increment financing district and the 
municipality are not the same, the authority shall apply to the 
municipality in which the district is proposed to be located and 
shall obtain the approval of its tax increment financing plan by 
the municipality before the authority may use tax increment 
financing.  The municipality shall approve the tax increment 
financing plan only after a public hearing thereon after 
published notice in a newspaper of general circulation in the 
municipality at least once not less than ten days nor more than 
30 days prior to the date of the hearing.  The published notice 
must include a map of the area of the district from which 
increments may be collected and, if the project area includes 
additional area, a map of the project area in which the 
increments may be expended.  The hearing may be held before or 
after the approval or creation of the project or it may be held 
in conjunction with a hearing to approve the project.  Before or 
at the time of approval of the tax increment financing plan, the 
municipality shall make the following findings, and shall set 
forth in writing the reasons and supporting facts for each 
determination: 
    (1) that the proposed tax increment financing district is a 
redevelopment district, a renewal or renovation district, a 
mined underground space development district, a housing 
district, a soils condition district, or an economic development 
district; if the proposed district is a redevelopment 
district or a renewal or renovation district, the reasons and 
supporting facts for the determination that the district meets 
the criteria of section 469.174, subdivision 10, paragraph (a), 
clauses (1) to (5) and (2), or subdivision 10a, must be retained 
and made available to the public by the authority until the 
district has been terminated. 
    (2) that the proposed development or redevelopment, in the 
opinion of the municipality, would not reasonably be expected to 
occur solely through private investment within the reasonably 
foreseeable future and therefore the use of tax increment 
financing is deemed necessary. 
    (3) that the tax increment financing plan conforms to the 
general plan for the development or redevelopment of the 
municipality as a whole. 
    (4) that the tax increment financing plan will afford 
maximum opportunity, consistent with the sound needs of the 
municipality as a whole, for the development or redevelopment of 
the project by private enterprise. 
    (5) that the municipality elects the method of tax 
increment computation set forth in section 469.177, subdivision 
3, clause (b), if applicable. 
    When the municipality and the authority are not the same, 
the municipality shall approve or disapprove the tax increment 
financing plan within 60 days of submission by the authority, or 
the plan shall be deemed approved.  When the municipality and 
the authority are not the same, the municipality may not amend 
or modify a tax increment financing plan except as proposed by 
the authority pursuant to subdivision 4.  Once approved, the 
determination of the authority to undertake the project through 
the use of tax increment financing and the resolution of the 
governing body shall be conclusive of the findings therein and 
of the public need for the financing. 
    Sec. 12.  Minnesota Statutes 1989 Supplement, section 
469.175, subdivision 4, is amended to read: 
    Subd. 4.  [MODIFICATION OF PLAN.] (a) A tax increment 
financing plan may be modified by an authority, provided that 
any reduction or enlargement of geographic area of the project 
or tax increment financing district, increase in amount of 
bonded indebtedness to be incurred, including a determination to 
capitalize interest on the debt if that determination was not a 
part of the original plan, or to increase or decrease the amount 
of interest on the debt to be capitalized, increase in the 
portion of the captured net tax capacity to be retained by the 
authority, increase in total estimated tax increment 
expenditures or designation of additional property to be 
acquired by the authority shall be approved upon the notice and 
after the discussion, public hearing, and findings required for 
approval of the original plan; provided that if an authority 
changes the type of district from housing, redevelopment, or 
economic development to another type of district, this change 
shall not be considered a modification but shall require the 
authority to follow the procedure set forth in sections 469.174 
to 469.179 for adoption of a new plan, including certification 
of the net tax capacity of the district by the county auditor.  
If a redevelopment district or a renewal and renovation district 
is enlarged, the reasons and supporting facts for the 
determination that the addition to the district meets the 
criteria of section 469.174, subdivision 10, paragraph (a), 
clauses (1) to (5) and (2), or subdivision 10a, must be 
documented.  The requirements of this paragraph do not apply if 
(1) the only modification is elimination of parcels from the 
project or district and (2)(A) the current net tax capacity of 
the parcels eliminated from the district equals or exceeds the 
net tax capacity of those parcels in the district's original net 
tax capacity or (B) the authority agrees that, notwithstanding 
section 469.177, subdivision 1, the original net tax capacity 
will be reduced by no more than the current net tax capacity of 
the parcels eliminated from the district.  The authority must 
notify the county auditor of any modification that reduces or 
enlarges the geographic area of a district or a project area.  
     (b) The geographic area of a tax increment financing 
district may be reduced, but shall not be enlarged after five 
years following the date of certification of the original net 
tax capacity by the county auditor or after August 1, 1984, for 
tax increment financing districts authorized prior to August 1, 
1979. 
    Sec. 13.  Minnesota Statutes Second 1989 Supplement, 
section 469.175, subdivision 7, is amended to read: 
    Subd. 7.  [CREATION OF HAZARDOUS SUBSTANCE SUBDISTRICT; 
RESPONSE ACTIONS.] (a) An authority which is creating or has 
created a tax increment financing district may establish within 
the district a hazardous substance subdistrict upon the notice 
and after the discussion, public hearing, and findings required 
for approval of or modification to the original plan.  The 
geographic area of the subdistrict is made up of any parcels in 
the district designated for inclusion by the municipality or 
authority that are designated hazardous substance sites, and any 
additional parcels in the district designated for inclusion that 
are contiguous to the hazardous substance sites, including 
parcels that are contiguous to the site except for the 
interposition of a right-of-way.  Before or at the time of 
approval of the tax increment financing plan or plan 
modification providing for the creation of the hazardous 
substance subdistrict, the authority must make the findings 
under paragraphs (b) to (d), and set forth in writing the 
reasons and supporting facts for each. 
    (b) Development or redevelopment of the site, in the 
opinion of the authority, would not reasonably be expected to 
occur solely through private investment and tax increment 
otherwise available, and therefore the hazardous substance 
district is deemed necessary. 
    (c) Other parcels that are not designated hazardous 
substance sites are expected to be developed together with a 
designated hazardous substance site.  
    (d) The subdistrict is not larger than, and the period of 
time during which increments are elected to be received is not 
longer than, that which is necessary in the opinion of the 
municipality authority to provide for the additional costs due 
to the designated hazardous substance site. 
    (e) Upon request by an authority that has incurred expenses 
for removal or remedial actions to implement a development 
response action plan, the attorney general may: 
    (1) bring a civil action on behalf of the authority to 
recover the expenses, including administrative costs and 
litigation expenses, under section 115B.04 or other law; or 
    (2) assist the authority in bringing an action as described 
in clause (1), by providing legal and technical advice, 
intervening in the action, or other appropriate assistance. 
The decision to participate in any action to recover expenses is 
at the discretion of the attorney general. 
    (f) If the attorney general brings an action as provided in 
paragraph (e), clause (1), the authority shall certify its 
reasonable and necessary expenses incurred to implement the 
development response action plan and shall cooperate with the 
attorney general as required to effectively pursue the action.  
The certification by the authority is prima facie evidence that 
the expenses are reasonable and necessary.  The attorney general 
may deduct litigation expenses incurred by the attorney general 
from any amounts recovered in an action brought under paragraph 
(e), clause (1).  The authority shall reimburse the attorney 
general for litigation expenses not recovered in an action under 
paragraph (e), clause (1), but only from the additional tax 
increment required to be used as described in section 469.176, 
subdivision 4e.  The authority must reimburse the attorney 
general for litigation expenses incurred to assist in bringing 
an action under paragraph (e), clause (2), but only from amounts 
recovered by the authority in an action or, if the amounts are 
insufficient, from the additional tax increment required to be 
used as described in section 469.176, subdivision 4e.  All money 
recovered or paid to the attorney general for litigation 
expenses under this paragraph shall be paid to the general fund 
of the state for deposit to the account of the attorney 
general.  For the purposes of this section, "litigation 
expenses" means attorney fees and costs of discovery and other 
preparation for litigation. 
     (g) The authority shall reimburse the pollution control 
agency for its administrative expenses incurred to review and 
approve a development action response plan.  The authority must 
reimburse the pollution control agency for expenses incurred for 
any services rendered to the attorney general to support the 
attorney general in actions brought or assistance provided under 
paragraph (e), but only from amounts recovered by the 
municipality or authority in an action brought under paragraph 
(e) or from the additional tax increment required to be used as 
described in section 469.176, subdivision 4e.  All money paid to 
the pollution control agency under this paragraph shall be 
deposited in the environmental response, compensation and 
compliance fund. 
    (h) Actions taken by an authority consistent with a 
development response action plan are deemed to be authorized 
response actions for the purpose of section 115B.17, subdivision 
12.  An authority that takes actions consistent with a 
development response action plan qualifies for the defenses 
available under sections 115B.04, subdivision 11, and 115B.05, 
subdivision 9. 
    (i) All money recovered by an authority in an action 
brought under paragraph (e) in excess of the amounts paid to the 
attorney general and the pollution control agency must be 
treated as excess increments and be distributed as provided in 
section 469.176, subdivision 2, clause (4), to the extent the 
removal and remedial actions were initially financed with 
increment revenues. 
    Sec. 14.  Minnesota Statutes 1988, section 469.175, is 
amended by adding a subdivision to read: 
    Subd. 8.  [PAYMENT OF DEBT SERVICE ON CREDIT ENHANCED 
BONDS.] A tax increment financing plan may provide for the use 
of the tax increment to pay, or secure payment of, debt service 
on credit enhanced bonds issued to finance any project located 
within the boundaries of the municipality, whether or not the 
tax increment financing district from which the increment is 
derived is located within the boundaries of the project. 
    Sec. 15.  Minnesota Statutes Second 1989 Supplement, 
section 469.176, subdivision 1, is amended to read: 
    Subdivision 1.  [DURATION OF TAX INCREMENT FINANCING 
DISTRICTS.] (a) Subject to the limitations contained in 
paragraphs (b) to (g), any tax increment financing district as 
to which bonds are outstanding, payment for which the tax 
increment and other revenues have been pledged, shall remain in 
existence at least as long as the bonds continue to be 
outstanding.  The municipality may, at the time of approval of 
the initial tax increment financing plan, provide for a shorter 
maximum duration limit than specified in paragraphs (b) to (g).  
The specified limit applies in place of the otherwise applicable 
limit.  
     (b) The tax increment pledged to the payment of the bonds 
and interest thereon may be discharged and the tax increment 
financing district may be terminated if sufficient funds have 
been irrevocably deposited in the debt service fund or other 
escrow account held in trust for all outstanding bonds to 
provide for the payment of the bonds at maturity or date of 
redemption and interest thereon to the maturity or redemption 
date.  
     (c) For bonds issued pursuant to section 469.178, 
subdivisions 2 and 3, the full faith and credit and any taxing 
powers of the municipality or authority shall continue to be 
pledged to the payment of the bonds until the principal of and 
interest on the bonds has been paid in full.  
     (d) No tax increment shall be paid to an authority for a 
tax increment financing district after three years from the date 
of certification of the original net tax capacity of the taxable 
real property in the district by the county auditor or after 
August 1, 1982, for tax increment financing districts authorized 
prior to August 1, 1979, unless within the three-year period (1) 
bonds have been issued pursuant to section 469.178, or in aid of 
a project pursuant to any other law, except revenue bonds issued 
pursuant to sections 469.152 to 469.165, prior to August 1, 
1979, or (2) the authority has acquired property within the 
district, or (3) the authority has constructed or caused to be 
constructed public improvements within the district. 
    (e) No tax increment shall in any event be paid to the 
authority from a redevelopment district (1) after 25 years from 
date of receipt by the authority of the first tax increment, 
after 25 years from the date of the receipt for a housing 
district, after 25 years from the date of the receipt for a 
mined underground space development district, redevelopment 
district, or housing district, (2) after 15 years after receipt 
by the authority of the first increment for a renewal and 
renovation district, (3) after 12 years from approval of the tax 
increment financing plan for a soils condition district, and (4) 
after eight years from the date of the receipt, or ten years 
from approval of the tax increment financing plan, whichever is 
less, for an economic development district. 
    For tax increment financing districts created prior to 
August 1, 1979, no tax increment shall be paid to the authority 
after April 1, 2001, or the term of a nondefeased bond or 
obligation outstanding on April 1, 1990, secured by increments 
from the district or project area, whichever time is greater, 
provided that in no case will a tax increment be paid to an 
authority after August 1, 2009, from such a district.  If a 
district's termination date is extended beyond April 1, 2001, 
because bonds were outstanding on April 1, 1990, with maturities 
extending beyond April 1, 2001, the following restrictions 
apply.  No increment collected from the district may be expended 
after April 1, 2001, except to pay or defease (i) bonds issued 
before April 1, 1990, or (ii) bonds issued to refund the 
principal of the outstanding bonds and pay associated issuance 
costs, provided the average maturity of the refunding bonds does 
not exceed the bonds refunded. 
       (f) Modification of a tax increment financing plan pursuant 
to section 469.175, subdivision 4, shall not extend the 
durational limitations of this subdivision. 
       (g) If a parcel of a district is part of a designated 
hazardous substance site or a hazardous substance subdistrict, 
tax increment may be paid to the authority from the parcel for 
longer than the period otherwise provided by this subdivision.  
The extended period for collection of tax increment begins on 
the date of receipt of the first tax increment from the parcel 
that is more than any tax increment received from the parcel 
before the date of the certification under section 469.175, 
subdivision 7, paragraph (b), and received after the date of 
certification to the county auditor described in section 
469.175, subdivision 7, paragraph (b).  The extended period for 
collection of tax increment is the lesser of:  (1) 25 years from 
the date of commencement of the extended period; or (2) the 
period necessary to recover the costs of removal actions or 
remedial actions specified in a development response action plan.
    Sec. 16.  Minnesota Statutes 1988, section 469.176, 
subdivision 2, is amended to read: 
    Subd. 2.  [EXCESS TAX INCREMENTS.] (a) In any year in which 
the tax increment exceeds the amount necessary to pay the costs 
authorized by the tax increment financing plan, including the 
amount necessary to cancel any tax levy as provided in section 
475.61, subdivision 3, the authority shall use the excess amount 
to do any of the following:  (1) prepay any outstanding bonds, 
(2) discharge the pledge of tax increment therefor, (3) pay into 
an escrow account dedicated to the payment of such bond, or (4) 
return the excess amount to the county auditor who shall 
distribute the excess amount to the municipality, county, and 
school district in which the tax increment financing district is 
located in direct proportion to their respective tax capacity 
rates.  The county auditor must report to the commissioner of 
education the amount of any excess tax increment distributed to 
a school district within 30 days of the distribution. 
     (b) The amounts distributed to a city or county must be 
deducted from the levy limits of the governmental unit for the 
following year.  In calculating the levy limit base for later 
years, the amount deducted must be treated as a local government 
aid payment. 
    Sec. 17.  Minnesota Statutes 1988, section 469.176, 
subdivision 3, is amended to read: 
    Subd. 3.  [LIMITATION ON ADMINISTRATIVE EXPENSES.] (a) For 
districts for which certification was requested before August 1, 
1979, or after June 30, 1982, no tax increment shall be used to 
pay any administrative expenses for a project which exceed ten 
percent of the total tax increment expenditures authorized by 
the tax increment financing plan or the total tax increment 
expenditures for the project, whichever is less.  
    (b) For districts for which certification was requested 
after July 31, 1979, and before July 1, 1982, no tax increment 
shall be used to pay administrative expenses, as defined in 
Minnesota Statutes 1980, section 273.73, for a project which 
exceeds five percent of the total tax increment expenditures 
authorized by the tax increment financing plan or the total tax 
increment expenditures for the project, whichever is less. 
    Sec. 18.  Minnesota Statutes 1989 Supplement, section 
469.176, subdivision 4c, is amended to read: 
    Subd. 4c.  [ECONOMIC DEVELOPMENT DISTRICTS.] (a) Revenue 
derived from tax increment from an economic development district 
may not be used to provide improvements, loans, subsidies, 
grants, interest rate subsidies, or assistance in any form to 
developments consisting of buildings and ancillary facilities, 
if at least 25 ten percent of the buildings and facilities 
(determined on the basis of square footage) are used for the 
purposes listed in section 144(a)(8) of the Internal Revenue 
Code of 1986 (determined without regard to the 25 percent 
restriction in subparagraph (A)).  The restrictions under this 
paragraph apply only to districts located in a purpose other 
than:  
    (1) the manufacturing or production of tangible personal 
property, including processing resulting in the change in 
condition of the property; 
    (2) warehousing, storage, and distribution of property, but 
excluding retail sales; 
    (3) research and development or telemarketing if that 
activity is the exclusive use of the property; or 
    (4) tourism facilities, if the tourism facility is not 
located in a development regions region, as defined in section 
462.384, with populations a population in excess of 1,000,000.  
     The percentage of buildings and facilities that may be used 
for nonqualifying purposes is increased above ten percent, but 
not over 25 percent, to the extent the nonqualifying square 
footage is directly related to and in support of the qualifying 
activity. 
    (b) Population must be determined under the provisions of 
section 477A.011.  Tourism facilities are limited to hotel and 
motel properties, including ancillary restaurants, convention 
and meeting facilities, amusement parks, recreation facilities, 
cultural facilities, marinas, and parks.  The city must find 
that the tourism facilities are intended primarily to serve 
individuals outside of the development region. 
    (c) If the authority financed the construction of 
improvements with increment revenues for a site on which the 
authority expected qualifying facilities to be constructed and 
nonqualified property was constructed on the site in excess of 
the amount permitted under paragraph (a) within five years after 
the district was created, the developer of the nonqualified 
property must pay to the authority an amount equal to 90 percent 
of the benefit resulting from the improvements.  The amount 
required to be paid may not exceed the proportionate cost of the 
improvements, including capitalized interest, that was financed 
with increment revenues.  The payment must be used to prepay or 
discharge bonds under section 469.176, subdivision 2, paragraph 
(a), clauses (1) to (3).  If no bonds are outstanding, the 
payment shall be distributed as an excess increment.  "Benefit" 
has the meaning given in chapter 429.  
    (d) Notwithstanding the provisions of this subdivision, 
revenue derived from tax increment from an economic development 
district may be used to provide improvements, loans, subsidies, 
grants, interest rate subsidies, or assistance in any form for 
up to 5,000 square feet of commercial and retail facilities 
within the municipal jurisdiction of a home rule charter or 
statutory city that has a population of 5,000 or less.  The 
5,000 square feet limitation is cumulative and applies to all 
facilities in all the economic development districts within the 
municipal jurisdiction. 
    Sec. 19.  Minnesota Statutes Second 1989 Supplement, 
section 469.176, subdivision 4j, is amended to read: 
    Subd. 4j.  [REDEVELOPMENT DISTRICTS.] At least 90 percent 
of the revenues derived from tax increments from a redevelopment 
district or renewal and renovation district must be used to 
finance the cost of correcting conditions that allow designation 
of redevelopment and renewal and renovation districts under 
section 469.174, subdivision 10.  These costs include acquiring 
properties containing structurally substandard buildings or 
improvements, acquiring adjacent parcels necessary to provide a 
site of sufficient size to permit development, demolition of 
structures, clearing of the land, and installation of utilities, 
roads, sidewalks, and parking facilities for the site.  The 
allocated administrative expenses of the authority may be 
included in the qualifying costs. 
    Sec. 20.  [469.1762] [ARBITRATION OF DISPUTES OVER COUNTY 
COSTS.] 
    If the county and the authority or municipality are unable 
to agree on either (1) the need for or cost of road improvements 
under section 469.175, subdivision 1a, or (2) the amount of 
county administrative costs under section 469.176, subdivision 
4h, and the county or municipality demands arbitration, the 
matter must be submitted to binding arbitration in accordance 
with sections 572.08 to 572.30 and the rules of the American 
Arbitration Association.  Within 30 days after the demand for 
arbitration, the parties shall each select an arbitrator or 
agree upon a single arbitrator.  If the parties each select an 
arbitrator, the two arbitrators shall select a third arbitrator 
within 45 days after the demand for arbitration.  Each party 
shall pay the fees and expenses of the arbitrator it selected 
and the parties shall share equally the expenses of the third 
arbitrator or an arbitrator agreed upon mutually by the parties. 
    Sec. 21.  [469.1763] [RESTRICTIONS ON POOLING; FIVE-YEAR 
LIMIT.] 
    Subdivision 1.  [DEFINITIONS.] (a) For purposes of this 
section, the following terms have the meanings given. 
    (b) "Activities" means acquisition of property, clearing of 
land, site preparation, soils correction, removal of hazardous 
waste or pollution, installation of utilities, construction of 
public or private improvements, and other similar activities, 
but only to the extent that tax increment revenues may be spent 
for such purposes under other law.  Activities do not include 
allocated administrative expenses, but do include engineering, 
architectural, and similar costs of the improvements in the 
district. 
    (c) "Third party" means an entity other than (1) the person 
receiving the benefit of assistance financed with tax 
increments, or (2) the municipality or the development authority 
or other person substantially under the control of the 
municipality. 
    Subd. 2.  [EXPENDITURES OUTSIDE DISTRICT.] (a) For each tax 
increment financing district, an amount equal to at least 75 
percent of the revenue derived from tax increments paid by 
properties in the district must be expended on activities in the 
district or to pay bonds, to the extent that the proceeds of the 
bonds were used to finance activities in the district or to pay, 
or secure payment of, debt service on credit enhanced bonds.  
Not more than 25 percent of the revenue derived from tax 
increments paid by properties in the district may be expended, 
through a development fund or otherwise, on activities outside 
of the district but within the defined geographic area of the 
project except to pay, or secure payment of, debt service on 
credit enhanced bonds.  The revenue derived from tax increments 
for the district that are expended on costs under section 
469.176, subdivision 4h, paragraph (b), may be deducted first 
before calculating the percentages that must be expended within 
and without the district.  
    (b) In the case of a housing district, a housing project, 
as defined in section 469.174, subdivision 11, is an activity in 
the district.  
    Subd. 3.  [FIVE-YEAR RULE.] (a) Revenues derived from tax 
increments are considered to have been expended on an activity 
within the district under subdivision 2 only if one of the 
following occurs: 
    (1) before or within five years after certification of the 
district, the revenues are actually paid to a third party with 
respect to the activity; 
    (2) bonds, the proceeds of which must be used to finance 
the activity, are issued and sold to a third party before or 
within five years after certification and the revenues are spent 
to repay the bonds; 
    (3) binding contracts with a third party are entered into 
for performance of the activity before or within five years 
after certification of the district and the revenues are spent 
under the contractual obligation; or 
    (4) costs with respect to the activity are paid before or 
within five years after certification of the district and the 
revenues are spent to reimburse a party for payment of the costs.
    (b) For purposes of this subdivision, bonds include 
subsequent refunding bonds if one of two tests is met:  (1) the 
proceeds of the original refunded bonds were spent on activities 
within five years after the district was certified or (2) the 
original refunded bonds are issued within five years after the 
district was certified and the proceeds are expended on 
activities within a reasonable temporary period within the 
meaning of the use of that term under section 148(c)(1) of the 
Internal Revenue Code. 
    Subd. 4.  [USE OF REVENUES FOR DECERTIFICATION.] Beginning 
with the sixth year following certification of the district, 75 
percent of the revenues derived from tax increments paid by 
properties in the district that remain after the expenditures 
permitted under subdivision 3 must be used only to pay 
outstanding bonds, as defined in subdivision 3, paragraph (a), 
clause (2), and paragraph (b) or contracts, as defined in 
subdivision 3, paragraph (a), clauses (3) and (4).  When the 
outstanding bonds have been defeased and when sufficient money 
has been set aside to pay contractual obligations as defined in 
subdivision 3, paragraph (a), clauses (3) and (4), the district 
must be decertified and the pledge of tax increment discharged. 
    Sec. 22.  Minnesota Statutes 1988, section 469.177, 
subdivision 8, is amended to read: 
    Subd. 8.  [ASSESSMENT AGREEMENTS.] An authority may, upon 
entering into a development or redevelopment agreement pursuant 
to section 469.176, subdivision 5, enter into a written 
assessment agreement in recordable form with the a developer or 
redeveloper of property within the tax increment financing 
district which establishes a minimum market value of the land 
and completed improvements to be constructed thereon until a 
specified termination date, which date shall be not later than 
the date upon which tax increment will no longer be remitted to 
the authority pursuant to section 469.176, subdivision 1.  The 
assessment agreement shall be presented to the county assessor, 
or city assessor having the powers of the county assessor, of 
the jurisdiction in which the tax increment financing district 
is located.  The assessor shall review the plans and 
specifications for the improvements to be constructed, review 
the market value previously assigned to the land upon which the 
improvements are to be constructed and, so long as the minimum 
market value contained in the assessment agreement appears, in 
the judgment of the assessor, to be a reasonable estimate, shall 
execute the following certification upon the agreement:  
     The undersigned assessor, being legally responsible 
     for the assessment of the above described property 
     upon completion of the improvements to be 
     constructed thereon, hereby certifies that the market 
     value assigned to the land and improvements upon 
     completion shall not be less than $........... .  
     Upon transfer of title of the land to be developed or 
redeveloped from the authority to the developer or redeveloper, 
the assessment agreement, together with a copy of this 
subdivision, shall be filed for record and recorded in the 
office of the county recorder or filed in the office of the 
registrar of titles of the county where the real estate or any 
part thereof is situated.  Upon completion of the improvements 
by the developer or redeveloper, the assessor shall value the 
property pursuant to section 273.11, except that the market 
value assigned thereto shall not be less than the minimum market 
value contained in the assessment agreement.  Nothing herein 
shall limit the discretion of the assessor to assign a market 
value to the property in excess of the minimum market value 
contained in the assessment agreement nor prohibit the developer 
or redeveloper from seeking, through the exercise of 
administrative and legal remedies, a reduction in market value 
for property tax purposes; provided, however, that the developer 
or redeveloper shall not seek, nor shall the city assessor, the 
county assessor, the county auditor, any board of review, any 
board of equalization, the commissioner of revenue, or any court 
of this state grant a reduction of the market value below the 
minimum market value contained in the assessment agreement 
during the term of the agreement filed of record regardless of 
actual market values which may result from incomplete 
construction of improvements, destruction, or diminution by any 
cause, insured or uninsured, except in the case of acquisition 
or reacquisition of the property by a public entity.  Recording 
or filing of an assessment agreement complying with the terms of 
this subdivision shall constitute notice of the agreement to any 
subsequent purchaser or encumbrancer of the land or any part 
thereof, whether voluntary or involuntary, and shall be binding 
upon them.  
    Sec. 23.  Minnesota Statutes 1989 Supplement, section 
469.177, subdivision 9, is amended to read: 
    Subd. 9.  [DISTRIBUTIONS OF EXCESS TAXES ON CAPTURED NET 
TAX CAPACITY.] (a) If the amount of tax paid on captured net tax 
capacity exceeds the amount of tax increment, the county auditor 
shall distribute the excess to the municipality, county, and 
school district as follows:  each governmental unit's share of 
the excess equals 
     (1) the total amount of the excess for the tax increment 
financing district, multiplied by 
     (2) a fraction, the numerator of which is the current tax 
capacity rate of the governmental unit less the governmental 
unit's tax capacity rate for the year the original tax capacity 
rate for the district was certified (in no case may this amount 
be less than zero) and the denominator of which is the sum of 
the numerators for the municipality, county, and school district.
If the entire increase in the tax capacity rate is attributable 
to a taxing district, other than the municipality, county, or 
school district, then the excess must be distributed to the 
municipality, county, and school district in proportion to their 
respective tax capacity rates. 
    The school district's tax rate must be divided into the 
portion of the tax rate attributable (1) to state equalized 
levies, and (2) unequalized levies.  Equalized levies mean the 
levies identified in section 273.1398, subdivision 2a, and 
unequalized levies mean the rest of the school district's 
levies.  The calculations under clause (2) must determine the 
amount of excess taxes attributable to each portion of the 
school district's tax rate.  If one of the portions of the 
change in the school district tax rate is less than zero and the 
combined change is greater than zero, the combined rate must be 
used and all the school district's share of excess taxes 
allocated to that portion of the tax rate. 
    (b) The amounts distributed shall be deducted in computing 
the levy limits of the taxing district for the succeeding 
taxable year.  In the case of a school district, only the 
proportion of the excess taxes attributable to unequalized 
levies that are subject to a fixed dollar amount levy limit 
shall be deducted from the levy limit. 
    (c) In the case of distributions to a school district that 
are attributable to state equalized levies, the county auditor 
shall report amounts distributed to the commissioner of 
education in the same manner as provided for excess increments 
under section 469.176, subdivision 2, and the distribution shall 
be treated as an excess increment for purposes of section 
124.214, subdivision 3 be deducted from the school district's 
state aid payments. 
    Sec. 24.  Minnesota Statutes Second 1989 Supplement, 
section 469.177, subdivision 10, is amended to read: 
    Subd. 10.  [PAYMENT TO SCHOOL FOR REFERENDUM LEVY.] (a) The 
provisions of this subdivision apply to tax increment financing 
districts and projects for which certification was requested 
before May 1, 1988, that are located in a school district in 
which the voters have approved new tax capacity rates or an 
increase in tax capacity rates after the tax increment financing 
district was certified.  
    (b) (1) If there are no outstanding bonds on May 1, 1988, 
to which increment from the district is pledged, or (2) if the 
referendum is approved after May 1, 1988, and there are no bonds 
outstanding at the time the referendum is approved, that were 
issued before May 1, 1988, or (3) if the referendum increasing 
the tax capacity rate was approved after the most recent issue 
of bonds to which increment from the district is pledged.  If 
clause (1) or (2) applies, the authority must annually pay to 
the school district an amount of increment equal to the 
increment that is attributable to the increase in the tax 
capacity rate under the referendum.  
    (2) If clause (3) applies (1) does not apply, upon approval 
by a majority vote of the governing body of the municipality and 
the school board, the authority must pay to the school district 
an amount of increment equal to the increment that is 
attributable to the increase in the tax capacity rate under the 
referendum.  
    (c) The amounts of these increments may be expended and 
must be treated by the school district in the same manner as 
provided for the revenues derived from the referendum levy 
approved by the voters.  The provisions of this subdivision 
apply to projects for which certification was requested before, 
on, and after August 1, 1979. 
    Sec. 25.  [469.1771] [VIOLATIONS.] 
    Subdivision 1.  [ENFORCEMENT.] (a) The commissioner of 
revenue shall enforce the provisions of sections 469.174 to 
469.179.  In addition, the owner of taxable property located in 
the city, town, school district, or county in which the tax 
increment financing district is located may bring suit for 
equitable relief or for damages, as provided in subdivisions 3 
and 4, arising out of a failure of a municipality or authority 
to comply with the provisions of sections 469.174 to 469.179, or 
related provisions of chapter 469.  The prevailing party in a 
suit filed under the preceding sentence is entitled to costs, 
including reasonable attorney fees. 
    (b) The responsibility for financial and compliance 
auditing of political subdivisions' use of tax increment 
financing remains with the state auditor.  If the state auditor 
finds evidence that an authority or municipality has violated a 
provision of the law for which a remedy is provided under this 
section, the state auditor shall forward the relevant 
information to the commissioner of revenue.  The commissioner of 
revenue may audit an authority's use of tax increment financing. 
    Subd. 2.  [COLLECTION OF INCREMENT.] If an authority 
includes or retains a parcel of property in a tax increment 
financing district that does not qualify for inclusion or 
retention within the district, the authority must pay to the 
county auditor an amount of money equal to the increment 
collected from the property for the year or years.  The property 
must be eliminated from the original and captured tax capacity 
of the district effective for the current property tax 
assessment year.  This subdivision does not apply to a failure 
to decertify a district required by the duration limits under 
section 469.176, subdivision 1. 
    Subd. 3.  [EXPENDITURE OF INCREMENT.] If an authority 
expends revenues derived from tax increments, including the 
proceeds of tax increment bonds, (1) for a purpose that is not a 
permitted project under section 469.176, (2) for a purpose that 
is not permitted under section 469.176 for the district from 
which the increment was received, or (3) on activities outside 
of the geographic area in which the revenues may be expended 
under this chapter, the authority must pay to the county auditor 
an amount equal to the expenditures made in violation of the law.
    Subd. 4.  [LIMITATIONS.] (a) If the increments are pledged 
to repay bonds that were issued before the lawsuit was filed 
under this section, the damages under this section may not 
exceed the greatest of (1) the damages under subdivision 2 or 3, 
(2) ten percent of the expenditures or revenues derived from 
increment, or (3) the amount of available revenues after paying 
debt services due on the bonds.  
    (b) The court may abate all or part of the amount if it 
determines the action was taken in good faith and would work an 
undue hardship on the municipality. 
    Subd. 5.  [DISPOSITION OF PAYMENTS.] If the authority does 
not have sufficient increments or other available moneys to make 
a payment required by this section, the municipality that 
approved the district must use any available moneys to make the 
payment including the levying of property taxes.  Money received 
by the county auditor under this section must be distributed as 
excess increments under section 469.176, subdivision 2, 
paragraph (a), clause (4).  No distributions may be made to the 
municipality that approved the tax increment financing district. 
    Subd. 6.  [APPLICATION.] This section applies to increments 
collected from tax increment financing districts and projects 
for which certification was requested before, on, and after 
August 1, 1979. 
    Sec. 26.  [469.1781] [REQUIRED EXPENDITURES FOR 
NEIGHBORHOOD REVITALIZATION.] 
    (a) The provisions of this section apply to a city of the 
first class if the following conditions are met: 
    (1) the city refunded bonds and revenues, derived from 
increment from a district for which certification was requested 
before August 1, 1979, were pledged to pay the bonds; 
    (2) the refunding bonds were issued after April 1, 1988, 
and before April 1, 1990; 
    (3) the refunded bonds' obligations were due and payable in 
full by the calendar year 2002 and the refunding bonds' 
obligations are payable, in whole or part, during the calendar 
years 2001 through 2009; and 
    (4) the city had in place during 1989 an ordinance 
providing for excess increments to be distributed under section 
469.176, subdivision 2, paragraph (a), clause (4), and the city 
modified the ordinance to eliminate all or part of the 
distributions of excess increments. 
    (b) For calendar years 1990 through 2001, in each year the 
city must expend for a neighborhood revitalization program, as 
established under section 27, an amount of revenues derived from 
tax increments equal to at least: 
    (1) the amount of the additional principal and interest 
payments that would have been due for the year on the refunded 
bonds, if the bonds had not been refunded; and 
    (2) the amount of money which would have been distributed 
as excess increments under the city ordinance had it not been 
modified. 
    Sec. 27.  [469.1831] [NEIGHBORHOOD REVITALIZATION PROGRAMS; 
FIRST CLASS CITIES.] 
    Subdivision 1.  [DEFINITIONS.] (a) For the purposes of this 
section, the following terms have the meanings given them. 
    (b) "Neighborhood action plan" means the plan developed 
with the participation of neighborhood residents under 
subdivision 6. 
    (c) "Neighborhood revitalization program" or "program" 
means the program developed under subdivision 5. 
    (d) "Neighborhood revitalization program money" or "program 
money" means the money derived from tax increments required to 
be expended on the program under section 26, paragraph (b). 
    Subd. 2.  [ESTABLISHMENT.] A city of the first class may 
establish a neighborhood revitalization program authorizing the 
expenditure of neighborhood revitalization program money.  The 
activities of a program must preserve and enhance within the 
neighborhood private and public physical infrastructure, public 
health and safety, economic vitality, the sense of community, 
and social benefits. 
    Subd. 3.  [PURPOSES; QUALIFYING COSTS.] (a) A neighborhood 
revitalization program may provide for expenditure of program 
money for the following purposes: 
    (1) to eliminate blighting influences by acquiring and 
clearing or rehabilitating properties that the city finds have 
caused or will cause a decline in the value of properties in the 
area or will increase the probability that properties in the 
area will be allowed to physically deteriorate; 
    (2) to assist in the development of industrial properties 
that provide employment opportunities paying a livable income to 
the residents of the neighborhood and that will not adversely 
affect the overall character of the neighborhood; 
    (3) to rehabilitate, renovate, or replace neighborhood 
commercial and retail facilities necessary to maintain 
neighborhood vitality; 
    (4) to eliminate health hazards through the removal of 
hazardous waste and pollution and return of land to productive 
use, if the responsible party is unavailable or unable to pay 
for the cost; 
    (5) to rehabilitate existing housing and encourage 
homeownership; 
    (6) to construct new housing, where appropriate; 
    (7) to rehabilitate and construct new low-income, 
affordable rental housing; 
    (8) to remove vacant and boarded up houses; and 
    (9) to rehabilitate or construct public facilities 
necessary to carry out the purpose of the program.  
    Subd. 4.  [PROGRAM MONEY; DISTRIBUTION AND 
RESTRICTIONS.] (a) Neighborhood revitalization program money may 
only be expended in accordance with the program for a purpose 
listed in subdivision 3 or this subdivision.  Program money may 
not be used in those project areas of the city where private 
investment is occurring without public sector assistance, except 
in cases where program money is being used to remove or 
rehabilitate structurally substandard or obsolete buildings.  
Revenues derived from tax increments may only be expended for 
the purposes otherwise permitted by law, except that 
notwithstanding any law to the contrary, the city must pay at 
least the following amount of program money, including revenues 
derived from tax increments:  (1) 15 percent to the school 
district, (2) 7.5 percent to the county, and (3) 7.5 percent for 
social services.  Payment must be made to the county and school 
district within 15 days after the city receives the distribution 
of increment revenues, provided that the payment for calendar 
year 1990 may be made at any time during the year.  Payment to 
the county for social services delivery shall be paid only after 
approval of program and spending plans under paragraph (b).  
Payment to the school district for education programs and 
services shall be paid only after approval of program and 
spending plans under paragraph (b). 
    (b) The money distributed to the county in a calendar year 
must be deducted from the county's levy limit for the following 
calendar year.  In calculating the county's levy limit base for 
later years, the amount deducted must be treated as a local 
government aid payment. 
    The city must notify the commissioner of education of the 
amount of the payment made to the school district for the year.  
The commissioner shall deduct from the school district's state 
education aid payments one-half of the amount received by the 
school district. 
    The program money paid to the school district must be 
expended for additional education programs and services in 
accordance with the program.  The amounts expended by the school 
district may not replace existing services. 
    The money for social services must be paid to the county 
for the cost of the provision of social services under the plan, 
as approved by the policy board and the county board.  
    (c) The city must expend on housing programs and related 
purposes as provided by the program at least 75 percent of the 
program money, after deducting the payments to the school 
district and county. 
    (d) Notwithstanding any other provisions of law to the 
contrary, for a city of the first class qualifying under section 
469.1781, paragraph (a), program money may be expended anywhere 
within the city by the authority for a purpose permitted by this 
section for any political subdivision.  
    Subd. 5.  [NEIGHBORHOOD REVITALIZATION PROGRAM; 
CONTENTS.] (a) The neighborhood revitalization program must be 
developed based on the following general principles: 
    (1) the social needs of neighborhood residents, 
particularly lower income residents, must be addressed to 
provide a safe and healthy environment for neighborhood 
residents, provide for the self-sufficiency of families, and 
increase the economic and social stability of neighborhoods; 
    (2) the children residing in the neighborhoods must be 
given the opportunity for a quality education and the needs of 
each neighborhood must be addressed individually wherever 
possible; and 
    (3) the physical structure of the neighborhoods must be 
enhanced by providing safe and suitable housing and 
infrastructure to increase the desirability of neighborhoods as 
places to live. 
    (b) The neighborhood revitalization program must include 
the following: 
    (1) the identification of the neighborhoods that require 
assistance through the program; 
    (2) a strategy of the citizen participation required under 
subdivision 6; 
    (3) the neighborhood action plans required under 
subdivision 6; 
    (4) the activities of participating organizations 
undertaken to address the general principles; and 
    (5) an evaluation of the success of the neighborhood action 
plans. 
    Subd. 6.  [CITIZEN PARTICIPATION REQUIRED.] (a) The 
neighborhood revitalization program must be developed with the 
process outlined in this subdivision. 
    (b) The development of the program must include the 
preparation of neighborhood action plans.  The city must 
organize neighborhood planning workshops to prepare the 
neighborhood action plans.  The neighborhood workshops must 
include the participation of, whenever possible, all populations 
and interests in each neighborhood including renters, 
homeowners, people of color, business owners, representatives of 
neighborhood institutions, youth, and the elderly.  The 
neighborhood action plan must be submitted to the policy board 
established under paragraph (c).  The city must provide 
available resources, information, and technical assistance to 
prepare the neighborhood action plans. 
    (c) Each city that develops a program must establish a 
policy board whose membership includes members of the city 
council, county board, school board, and citywide library and 
park board where they exist appointed by the respective 
governing bodies; the mayor or designee of the mayor; and a 
representative from the city's house of representatives 
delegation and a representative from the city's state senate 
delegation appointed by the respective delegation.  The policy 
board may also include representatives of citywide community 
organizations, neighborhood organizations, business owners, 
labor, and neighborhood residents.  The elected officials who 
are members of the policy board may appoint the other members of 
the board. 
    (d) The policy board shall review, modify where 
appropriate, and approve, in whole or in part, the neighborhood 
action plans and forward its recommendations for final action to 
the governing bodies represented on the policy board.  The 
governing bodies shall review, modify where appropriate, and 
give final approval, in whole or in part, to those actions over 
which they have programmatic jurisdiction. 
    Subd. 7.  [REVIEW OF PROGRAM COMPLIANCE.] The policy board 
must periodically review the activities funded with program 
money to determine if the expenditure of the program money is in 
compliance with the neighborhood revitalization program.  
    Sec. 28.  Laws 1988, chapter 719, article 12, section 30, 
as amended by Laws 1989, chapter 1, section 11, is amended to 
read: 
    Sec. 30.  [EFFECTIVE DATES.] 
    Sections 2, 5, 6, 7, 14, 16, subdivision 4e, 17, and the 
provisions of section 15 relating to the duration of hazardous 
substance sites and subdistricts are effective for hazardous 
substance sites and subdistricts designated and created after 
the day following final enactment.  Except as otherwise 
specifically provided, sections 1, 3, 4, 8 to 12, 16, and 20 to 
23, and the provisions of section 15 applying to soils condition 
districts are effective for districts and amendments adding 
geographic area to an existing district for which the request 
for certification was filed with the county auditor after May 1, 
1988.  Sections 13, 15, 16, subdivision 4g, 18, 24, and 25, and 
the provisions of section 21 allowing a change in the fiscal 
disparities election are effective May 1, 1988, except as 
otherwise specifically provided.  Section 16, subdivision 4h, is 
effective beginning with administrative costs incurred on May 1, 
1990, and notwithstanding Minnesota Statutes, section 469.179, 
applies to districts and project areas for which certification 
was requested before August 1, 1979.  Section 16, subdivision 
4i, is effective for districts for which the request for 
certification is filed with the county after May 1, 1988, and to 
all increment collected after January 1, 1990.  Sections 26 to 
28 are effective upon approval by the city council of the city 
of Virginia and compliance with Minnesota Statutes, section 
645.021.  Section 29 is effective the day following final 
enactment. 
    Sec. 29.  [EXPENDITURE AND REPORT ON NEIGHBORHOOD 
REVITALIZATION; CITY OF MINNEAPOLIS.] 
    Subdivision 1.  [EXPENDITURE.] The city of Minneapolis 
shall reserve $10,000,000 in 1990 and $20,000,000 each year from 
1991 to 2009 from tax increment and other revenues generated 
from the Minneapolis community development agency common 
project, adopted December 30, 1989, to be expended in 
neighborhood revitalization.  None of these revenues shall be 
expended in 1990. 
    Subd. 2.  [REVIEW AND REPORT.] By January 1, 1991, the city 
shall review the collaborative process provided under section 
27, subdivision 6, involving the county board and school board 
and citizens in developing priorities for addressing problems of 
neighborhoods, including housing, safety, drugs, jobs, and 
education.  The city shall report to the legislature by February 
1, 1991, on the collaborative process including any changes the 
city recommends, proposed expenditure of funds, and scope of 
coordinated activities by county, school, and city. 
    Sec. 30.  [TRANSITION RULES.] 
    Subdivision 1.  [CIRCLE PINES.] Section 21 does not apply 
to a tax increment financing district created in the city of 
Circle Pines, if the request for certification is filed by June 
30, 1990, to the extent increments are used to clear substandard 
housing and construct a senior citizen housing project located 
outside of the district. 
    Subd. 2.  [ECONOMIC DEVELOPMENT; MIXED USE.] Sections 8, 
18, and 21 do not apply to tax increment financing districts 
established in a development district approved by an authority 
under Minnesota Statutes, sections 469.124 to 469.134 on 
February 27, 1989, if the request for certification is filed by 
May 1, 1992. 
    Subd. 3.  [COMMERCIAL DEVELOPMENT.] Sections 15 and 21 do 
not apply to tax increment financing districts established in a 
development district approved by an authority under Minnesota 
Statutes, sections 469.124 to 469.134 on April 24, 1989, if the 
request for certification is filed by June 1, 1991. 
    Subd. 4.  [MEDICAL FACILITIES.] Section 18 does not apply 
to a tax increment financing district in the city of Mankato to 
provide assistance to a clinic, medical office, or related 
facilities, adjacent to a nonprofit hospital, if the request for 
certification is filed by September 30, 1990. 
    Subd. 5.  [LAKEVILLE.] Sections 8 and 18 do not apply to 
tax increment financing districts in the city of Lakeville 
created within I-35 Redevelopment Project No. 1 and which are 
approved by the city, if the request for certification is filed 
by September 30, 1990. 
    Subd. 6.  [BURNSVILLE.] Sections 8 and 18 do not apply to a 
tax increment financing district established by the city of 
Burnsville for a development consisting of an amphitheatre and 
solid waste transfer station, if the request for certification 
is filed by September 30, 1990. 
    Subd. 7.  [COOK COUNTY.] Section 21 does not apply to an 
authority in Cook county for tax increment financing districts 
established in a project created by law prior to April 30, 1990, 
if the request for certification is filed by May 1, 1992. 
    Sec. 31.  [EFFECTIVE DATE.] 
    (a) Section 1 is effective for school year 1991-1992 and 
for homestead and agricultural credit aid and local government 
aids for taxes payable in 1991.  Sections 2 to 4, 13, 17, 20, 
22, 24, and 26 to 30 are effective May 1, 1990.  Sections 5 to 
12, 14, 15, 18, 19, and 21 are effective for districts for which 
certification is requested after April 30, 1990.  Sections 16 
and 23 are effective for distributions of excess taxes or tax 
increments received after December 31, 1990.  Section 25 is 
effective for violations occurring after December 31, 1990.  
    (b) Notwithstanding paragraph (a) or section 1, sections 1, 
5 to 12, 14, 15, 18, 19, and 21 apply to a district, if the 
request for certification was made after March 31, 1990, and 
before May 1, 1990, and none of the following actions were taken 
by June 1, 1991:  (1) the authority entered into a development 
agreement for a site located in the district, (2) bonds were 
issued to finance project costs, or (3) the authority acquired 
property in the district after April 1, 1990. 

                               ARTICLE 8 

                           EDUCATION FUNDING 
    Section 1.  Minnesota Statutes Second 1989 Supplement, 
section 124.83, subdivision 1, is amended to read: 
    Subdivision 1.  [HEALTH AND SAFETY PROGRAM.] To receive 
health and safety revenue a district, including an intermediate 
district, must submit to the commissioner of education an 
application for aid and levy by June 1 in the previous school 
year.  The application may be for hazardous substance removal, 
fire code compliance, or life safety repairs.  The application 
must include a health and safety program adopted by the school 
district board.  The program must include the estimated cost of 
the program by fiscal year. 
    Sec. 2.  Minnesota Statutes 1989 Supplement, section 
124.83, subdivision 6, is amended to read: 
    Subd. 6.  [USES OF HEALTH AND SAFETY REVENUE.] Health and 
safety revenue may be used only for approved expenditures 
necessary to correct fire safety hazards, life safety hazards, 
or 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 heating fuel or transportation fuels such as 
alcohol, gasoline, fuel oil, and special fuel, as defined in 
section 296.01.  The revenue may not be used for a building or 
property or part of a building or property used for 
post-secondary instruction or administration or for a purpose 
unrelated to elementary and secondary education. 
    Sec. 3.  Minnesota Statutes 1988, section 136D.27, 
subdivision 2, is amended to read: 
    Subd. 2.  [PROHIBITED LEVIES.] Notwithstanding section 
136D.24 or any other law to the contrary, the joint school board 
may not certify, either itself, to any participating district, 
or to any cooperating school district, any levies for any 
purpose, except the levies authorized by subdivision 1, sections 
124.83, subdivision 4, 127.05, 275.125, subdivisions 8c and 14a, 
275.48, and 475.61, and for the joint school board's obligations 
under section 268.06, subdivision 25, for which a levy is 
authorized by section 275.125, subdivision 4. 
    Sec. 4.  Minnesota Statutes 1989 Supplement, section 
136D.27, subdivision 3, is amended to read: 
    Subd. 3.  [PROHIBITED STATE AIDS.] Notwithstanding section 
136D.24 or any law to the contrary, the department of education 
shall not pay, unless explicitly authorized by statute, any 
state aid, grant, credit, or other money to the joint school 
board, except the aid, credit, or money authorized by sections 
121.201, 123.3514, 124.252, 124.32, 124.573, 124.574, and 
124.646, 124.83, and chapter 273. 
    Sec. 5.  Minnesota Statutes 1988, section 136D.74, 
subdivision 2a, is amended to read: 
    Subd. 2a.  [PROHIBITED LEVIES.] Notwithstanding 
subdivisions 2 and 4, section 136D.73, subdivision 3, or any 
other law to the contrary, the intermediate school board may not 
certify, either itself, to any participating district, or to any 
cooperating school district, any levies for any purpose, except 
the levies authorized by subdivision 1, sections 124.83, 
subdivision 4, 127.05, 275.125, subdivisions 8c and 14a, 275.48, 
and 475.61, and for the intermediate school board's obligations 
under section 268.06, subdivision 25, for which a levy is 
authorized by section 275.125, subdivision 4. 
    Sec. 6.  Minnesota Statutes 1989 Supplement, section 
136D.74, subdivision 2b, is amended to read: 
    Subd. 2b.  [PROHIBITED STATE AIDS.] Notwithstanding 
subdivision 4 or any law to the contrary, the department of 
education shall not pay, unless explicitly authorized, any state 
aid, grant, credit, or other money to the intermediate school 
board, except the aid, credit, or money authorized by sections 
121.201, 123.3514, 124.252, 124.32, 124.573, 124.574, and 
124.646, 124.83, and chapter 273. 
    Sec. 7.  Minnesota Statutes 1988, section 136D.87, 
subdivision 2, is amended to read: 
    Subd. 2.  [PROHIBITED LEVIES.] Notwithstanding section 
136D.84 or any other law to the contrary, the joint school board 
may not certify, either itself, to any participating district, 
or to any cooperating school district, any levies for any 
purpose, except the levies authorized by subdivision 1, sections 
124.83, subdivision 4, 127.05, 275.125, subdivisions 8c and 14a, 
275.48, and 475.61, and for the joint school board's obligations 
under section 268.06, subdivision 25, for which a levy is 
authorized by section 275.125, subdivision 4. 
    Sec. 8.  Minnesota Statutes 1989 Supplement, section 
136D.87, subdivision 3, is amended to read: 
    Subd. 3.  [PROHIBITED STATE AIDS.] Notwithstanding section 
136D.24 or any law to the contrary, the department of education 
shall not pay, unless explicitly authorized, any state aid, 
grant, credit, or other money to the joint school board, except 
for aid, credit, or money authorized by sections 121.201, 
123.3514, 124.252, 124.32, 124.573, 124.574, and 
124.646, 124.83, and chapter 273. 
    Sec. 9.  Laws 1959, chapter 462, section 3, subdivision 10, 
as renumbered, as amended by Laws 1963, chapter 645, section 3, 
Laws 1967, chapter 661, section 3, Laws 1969, chapter 994, 
section 1, Laws 1975, chapter 320, section 1, Laws 1980, chapter 
525, section 2, and Laws 1989, chapter 329, article 5, section 
17, is amended to read: 
    Subd. 10.  [SPECIAL SCHOOL DISTRICT NO. 1; MINNEAPOLIS, 
CITY OF; EXTENDING BONDING AUTHORITY.] As used in this act the 
word "project" shall mean any proposed new or enlarged school 
building site, any proposed new school building or any proposed 
new addition to a school building, and "undertaking" shall mean 
any other purpose for which bonds may be issued as authorized in 
this subdivision.  Subject to the limitations of subdivision 11, 
the special independent school district of Minneapolis may issue 
and sell bonds with the approval of 53 percent of the electors 
voting on the question at a general school district election or 
at a school district election held at the same time and place 
within the district as a state general or primary election, as 
determined by the board of education.  Subject to the provisions 
of subdivision 11, the school district may also by a two-thirds 
majority vote of all the members of its board of education and 
without any election by the voters of the district, issue and 
sell in each calendar year bonds of the district in an amount 
not to exceed one-half of one percent of the assessed value of 
the taxable property in the district (plus, for calendar year 
1990 years 1990 to 1996, an amount not to exceed $7,500,000; 
with an additional provision that any amount of bonds so 
authorized for sale in a specific year and not sold can be 
carried forward and sold in the year immediately following); 
provided, however, that the board shall submit the list of 
projects and undertakings to be financed by a proposed issue to 
the city planning commission as provided in subdivision 11(c).  
All bonds of the school district shall be payable in not more 
than 30 years.  The proceeds of the sale of the bonds shall be 
used only for the rehabilitating, remodeling, expanding and 
equipping of existing school buildings and for the acquisition 
of sites, construction and equipping of new school buildings, 
and for acquisition and betterment purposes, and no part of the 
proceeds shall be used for maintenance.  The provisions of this 
act shall apply to the issuance and sale of the bonds and to the 
purposes for which the bonds may be issued notwithstanding any 
provisions to the contrary in any other existing law relating 
thereto. 
    Sec. 10.  [ST. PAUL BONDING AUTHORIZATION; TAX LEVY FOR 
DEBT SERVICE.] 
    Subdivision 1.  [BONDING AUTHORIZATION.] To provide funds 
to acquire or better facilities, independent school district No. 
625 may by two-thirds majority vote of all the members of the 
board of directors issue general obligation bonds in one or more 
series in calendar years 1990 and 1991 as provided in this 
section.  The aggregate principal amount of any bonds issued 
under this section for each calendar year must not exceed 
$9,000,000.  Issuance of the bonds is not subject to Minnesota 
Statutes, section 475.58 or 475.59.  As with other bonds issued 
by independent school district No. 625, the first sentence of 
Minnesota Statutes, section 475.53, subdivision 5, does not 
apply to issuance of the bonds.  The bonds must otherwise be 
issued as provided in Minnesota Statutes, chapter 475.  The 
authority to issue bonds under this section is in addition to 
any bonding authority authorized by Minnesota Statutes, chapter 
124, or other law.  The amount of bonding authority authorized 
under this section must be disregarded in calculating the 
bonding limit of Minnesota Statutes, chapter 124, or any other 
law other than Minnesota Statutes, section 475.53, subdivision 4.
    Subd. 2.  [TAX LEVY FOR DEBT SERVICE.] To pay the principal 
of and interest on bonds issued under subdivision 1, independent 
school district No. 625 must levy a tax annually in an amount 
sufficient under Minnesota Statutes, section 475.61, 
subdivisions 1 and 3, to pay the principal of and interest on 
the bonds.  The tax authorized under this section is in addition 
to the taxes authorized to be levied under Minnesota Statutes, 
chapter 124A or 275, or other law. 
    Subd. 3.  [EFFECTIVE DATE; LOCAL APPROVAL.] Subdivisions 1 
and 2 are effective the day after the governing body of 
independent school district No. 625 complies with Minnesota 
Statutes, sections 645.021, subdivision 3. 
    Sec. 11.  [DULUTH BONDING.] 
    Subdivision 1.  [BONDING AUTHORIZATION.] To provide funds 
for the acquisition and betterment, as defined in Minnesota 
Statutes, section 475.51, subdivisions 7 and 8, of existing and 
new facilities, independent school district No. 709 may, by 
two-thirds majority vote of all the members of the school board, 
issue general obligation bonds in one or more series in calendar 
years 1990 and 1991 as provided in this section.  The aggregate 
principal amount of any bonds issued under this section for 
calendar years 1990 and 1991 may not exceed $9,600,000.  
Issuance of the bonds is not subject to Minnesota Statutes, 
section 475.58 or 475.59.  As with other bonds issued by 
independent school district No. 709, Minnesota Statutes, section 
475.53, subdivision 5, does not apply to issuance of the bonds.  
If the school board proposes to issue bonds under this section, 
it must publish a resolution describing the proposed bond issue 
once each week for two successive weeks in a legal newspaper 
published in the city of Duluth.  The bonds may be issued 
without the submission of the question of their issue to the 
electors unless within 30 days after the second publication of 
the resolution a petition requesting an election signed by a 
number of people residing in the school district equal to 15 
percent of the people registered to vote in the last general 
election in the school district is filed with the recording 
officer.  If such a petition is filed, no bonds shall be issued 
under this section unless authorized by a majority of the 
electors voting on the question at the next general or special 
election called to decide the issue.  The bonds must otherwise 
be issued as provided in Minnesota Statutes, chapter 475.  The 
authority to issue bonds under this section is in addition to 
any bonding authority authorized by Minnesota Statutes, chapter 
124, or other law.  The amount of bonding authority authorized 
under this section must be disregarded in calculating the 
bonding limit of chapter 124 or any other law other than 
Minnesota Statutes, section 475.53, subdivision 4, as made 
applicable to independent school district No. 709 by Laws 1973, 
chapter 266.  
    Subd. 2.  [TAX LEVY FOR DEBT SERVICE.] To pay the principal 
of and interest on bonds issued under subdivision 1, independent 
school district No. 709 shall levy a tax in an amount sufficient 
under Minnesota Statutes, section 475.61, subdivisions 1 and 3, 
to pay the principal of and interest on the bonds.  The tax 
authorized under this section is in addition to the taxes 
authorized to be levied under Minnesota Statutes, chapter 124A 
or 275, or other law. 
    Sec. 12.  [TAXPAYER NOTIFICATION.] 
    Subdivision 1.  [APPLICABILITY.] This section applies to 
any newly authorized bonding authority granted under section 9 
or 10.  This newly authorized bonding authority is in addition 
to any existing bonding authority of a school district. 
    Subd. 2.  [MEETING.] A school board must hold a public 
meeting in each state senate district that is located wholly or 
partly within the boundaries of the school district.  The school 
board must hold the public meeting to obtain comments and 
recommendations from residents on the proposed sale of newly 
authorized bonds described under subdivision 1.  The meeting 
must be in addition to any other scheduled meeting of the school 
board or its committees.  The meeting must be held in an 
accessible place and at a convenient time for the majority of 
residents in the affected state senate district.  Meetings must 
be held in each state senate district each year the district 
sells bonds beginning with calendar year 1990. 
    Subd. 3.  [NOTICE.] A school board must prepare and have 
delivered by mail a notice of the public meeting on the proposed 
sale of newly authorized bonds to each senate district postal 
patron residing within the school district.  The notice must be 
mailed at least 15 days but not more than 30 days prior to the 
scheduled date of the meeting required for each state senate 
district under subdivision 2.  Notice of the meeting in each 
state senate district also must be posted in the administrative 
office of the school district and must be published in the 
official newspaper of the city in which the school district is 
located twice during the 14 days preceding the date of the 
meeting. 
    The notice must contain the following information: 
    (1) the proposed amount of bonds to be issued; 
    (2) the dollar amount of the levy increase necessary to pay 
the principal and interest on the newly authorized bonds; 
    (3) the estimated levy amount and net tax capacity rate 
necessary to make the debt service payments on any existing 
outstanding debt; 
    (4) the projected effects on individual property types.  
The notice must show the projected annual dollar increase and 
net tax capacity rate increase for a representative range of 
residential homestead, residential nonhomestead, apartment, and 
commercial-industrial properties located within each state 
senate district; and 
    (5) the required levy and principal and interest on all 
outstanding bonds in addition to the bonds proposed under clause 
(1). 
    Subd. 4.  [BOND AUTHORIZATION.] A school board may vote to 
issue bonds newly authorized under section 9 or 10 only after 
complying with the requirements under subdivisions 2 and 3, and 
an official record of all the meetings in the school district 
has been filed with the commissioner of education. 
    Sec. 13.  [COLERAINE, LAKE SUPERIOR, CHISHOLM, ELY, 
EVELETH, GILBERT, BABBITT, AND ST. LOUIS COUNTY SCHOOL DISTRICT 
BONDS.] 
    Subdivision 1.  [AUTHORIZATION.] Independent school 
district No. 316, Coleraine, may issue bonds in an aggregate 
principal amount not exceeding $950,000; independent school 
district No. 381, Lake Superior, may issue bonds in an aggregate 
principal amount not exceeding $300,000; independent school 
district No. 695, Chisholm, may issue bonds in an aggregate 
principal amount not exceeding $3,500,000; independent school 
district No. 696, Ely, may issue bonds in an aggregate principal 
amount not exceeding $1,000,000; independent school district No. 
697, Eveleth, may issue bonds in an aggregate principal amount 
not exceeding $3,500,000; independent school district No. 699, 
Gilbert, may issue bonds in an aggregate principal amount not 
exceeding $1,000,000; and independent school district No. 692, 
Babbitt, may issue bonds in an aggregate principal amount not 
exceeding $500,000.  
    Subd. 2.  [AUTHORIZATION.] Independent school district No. 
710, St. Louis county, may issue bonds in an aggregate amount 
not to exceed $1,750,000.  
    Subd. 3.  [USES; PROCESS.] The bonds authorized under 
subdivisions 1 and 2 may be issued in addition to any bonds 
already issued or authorized.  The proceeds of the bonds shall 
be used to provide funds to construct, equip, furnish, remodel, 
rehabilitate, and acquire land for school facilities and 
buildings and to pay any architects', engineers', and legal fees 
incidental to those purposes or the sale.  Except as permitted 
by this section, the bonds shall be authorized, issued, sold, 
executed, and delivered in the manner provided by Minnesota 
Statutes, chapter 475.  A referendum on the question of issuing 
the bonds authorized under subdivision 2 is not required.  A 
resolution of the board levying taxes for the payment of the 
bonds and interest on them as authorized by this section and 
pledging the proceeds of the levies for the payment of the bonds 
and interest on them shall be deemed to be in compliance with 
the provisions of chapter 475 with respect to the levying of 
taxes for their payment.  
    Subd. 4.  [APPROPRIATION.] There is annually appropriated 
from the distribution of taconite production tax revenues to the 
taconite environmental protection fund pursuant to Minnesota 
Statutes, section 298.28, subdivision 11, and to the northeast 
Minnesota economic protection trust pursuant to section 298.28, 
subdivisions 9 and 11, in equal shares, an amount sufficient to 
pay when due 80 percent of the principal and interest on the 
bonds issued under subdivision 1 and 100 percent of the 
principal and interest on the bonds issued under subdivision 2.  
If the annual distribution to the northeast Minnesota economic 
protection trust is insufficient to pay its share after 
fulfilling any obligations of the trust under Minnesota 
Statutes, section 298.225 or 298.293, the deficiency shall be 
appropriated from the taconite environmental protection fund.  
    Subd. 5.  [DISTRICT OBLIGATIONS.] Bonds issued under 
authority of this section shall be the general obligations of 
the school district, for which its full faith and credit and 
unlimited taxing powers shall be pledged.  If there are any 
deficiencies in the amount received pursuant to subdivision 4, 
they shall be made good by general levies, not subject to limit, 
on all taxable properties in the district in accordance with 
Minnesota Statutes, section 475.74.  If any deficiency levies 
are necessary, the school board may effect a temporary loan or 
loans on certificates of indebtedness issued in anticipation of 
them to meet payments of principal or interest on the bonds due 
or about to become due.  
     Subd. 6.  [DISTRICT LEVY.] The school board of each school 
district authorized to issue bonds under subdivision 1 shall by 
resolution levy on all property in the school district subject 
to the general ad valorem school tax levies, and not subject to 
taxation under Minnesota Statutes, sections 298.23 to 298.28, a 
direct annual ad valorem tax for each year of the term of the 
bonds in amounts that, if collected in full, will produce the 
amounts needed to meet when due 20 percent of the principal and 
interest payments on the bonds.  A copy of the resolution shall 
be filed, and the necessary taxes shall be extended, assessed, 
collected, and remitted in accordance with Minnesota Statutes, 
section 475.61.  
    Subd. 7.  [LEVY LIMITATIONS.] Taxes levied pursuant to this 
section shall be disregarded in the calculation of any other tax 
levies or limits on tax levies provided by other law.  
    Subd. 8.  [BONDING LIMITATIONS.] Bonds may be issued under 
authority of this section notwithstanding any limitations upon 
the indebtedness of a district, and their amounts shall not be 
included in computing the indebtedness of a district for any 
purpose, including the issuance of subsequent bonds and the 
incurring of subsequent indebtedness.  
    Subd. 9.  [TERMINATION OF APPROPRIATION.] The appropriation 
authorized in subdivision 4 shall terminate upon payment or 
maturity of the last of those bonds.  
    Subd. 10.  [LOCAL APPROVAL.] This section is effective for 
independent school district No. 316, the day after its governing 
body complies with Minnesota Statutes, section 645.021, 
subdivision 3, and for independent school district No. 381, the 
day after its governing body complies with Minnesota Statutes, 
section 645.021, subdivision 3, and for independent school 
district No. 695, the day after its governing body complies with 
Minnesota Statutes, section 645.021, subdivision 3, and for 
independent school district No. 696, the day after its governing 
body complies with Minnesota Statutes, section 645.021, 
subdivision 3, and for independent school district No. 697, the 
day after its governing body complies with Minnesota Statutes, 
section 645.021, subdivision 3, and for independent school 
district No. 699, the day after its governing body complies with 
Minnesota Statutes, section 645.021, subdivision 3, and for 
independent school district No. 692, the day after its governing 
body complies with Minnesota Statutes, section 645.021, 
subdivision 3, and for independent school district No. 710, the 
day after its governing body complies with Minnesota Statutes, 
section 645.021, subdivision 3. 
    Sec. 14.  [FUND BALANCE CORRECTION.] 
    Independent school district No. 624, White Bear Lake, is 
eligible for reinstatement of the foundation levy lost through 
the fund balance reduction provisions of the foundation formula 
for the 1985-1986, 1986-1987, and 1987-1988 school years if the 
fund balance reduction was the result of either referendum 
revenues added to the net unappropriated general fund balance or 
a transfer of funds from the capital expenditure account to the 
general fund.  The district may make a special levy in an amount 
not to exceed the amount of the levy reduction caused by the 
tier two foundation levy reductions for the 1985-1986, 
1986-1987, and 1987-1988 school years, but not to exceed 
$1,289,418.  The district may levy part of the amount: 
    (1) in 1990 and the remainder in 1991; or 
    (2) in 1990 and 1991 and the remainder in 1992. 
The district may not receive foundation aid, general education 
aid, or any other aid as a result of levying under this section. 

                               ARTICLE 9

                             COURT FUNDING
    Section 1.  Minnesota Statutes Second 1989 Supplement, 
section 275.50, subdivision 5, is amended to read: 
    Subd. 5.  Notwithstanding any other law to the contrary for 
taxes levied in 1989 payable in 1990 and subsequent years, 
"special levies" means those portions of ad valorem taxes levied 
by governmental subdivisions to: 
    (a) for taxes levied in 1990, payable in 1991 and 
subsequent years, pay the costs not reimbursed by the state or 
federal government, of payments made to or on behalf of 
recipients of aid under any public assistance program authorized 
by law, and the costs of purchase or delivery of social 
services.  The aggregate amounts levied under this clause for 
the costs of purchase or delivery of social services and income 
maintenance programs, other than those identified in section 
273.1398, subdivision 1, paragraph (i), are subject to a maximum 
increase over the amount levied for the previous year of 12 
percent for counties within the metropolitan area as defined in 
section 473.121, subdivision 2, or counties outside the 
metropolitan area but containing a city of the first class, and 
15 percent for other counties.  For purposes of this clause, 
"income maintenance programs" include income maintenance 
programs in section 273.1398, subdivision 1, paragraph (i), to 
the extent the county provides benefits under those programs 
over the statutory mandated standards.  Effective with taxes 
levied in 1990, the portion of this special levy for human 
service programs identified in section 273.1398, subdivision 1, 
paragraph (i), is eliminated; 
     (b) pay the costs of principal and interest on bonded 
indebtedness except on bonded indebtedness issued under section 
471.981, subdivisions 4 to 4c, or to reimburse for the amount of 
liquor store revenues used to pay the principal and interest due 
in the year preceding the year for which the levy limit is 
calculated on municipal liquor store bonds; 
     (c) pay the costs of principal and interest on certificates 
of indebtedness, except tax anticipation or aid anticipation 
certificates of indebtedness, issued for any corporate purpose 
except current expenses or funding an insufficiency in receipts 
from taxes or other sources or funding extraordinary 
expenditures resulting from a public emergency; and to pay the 
cost for certificates of indebtedness issued pursuant to 
sections 298.28 and 298.282; 
     (d) fund the payments made to the Minnesota state armory 
building commission pursuant to section 193.145, subdivision 2, 
to retire the principal and interest on armory construction 
bonds; 
     (e) provide for the bonded indebtedness portion of payments 
made to another political subdivision of the state of Minnesota; 
     (f) pay the amounts required, in accordance with section 
275.075, to correct for a county auditor's error of omission but 
only to the extent that when added to the preceding year's levy 
it is not in excess of an applicable statutory, special law or 
charter limitation, or the limitation imposed on the 
governmental subdivision by sections 275.50 to 275.56 in the 
preceding levy year; 
     (g) pay amounts required to correct for an error of 
omission in the levy certified to the appropriate county auditor 
or auditors by the governing body of a city or town with 
statutory city powers in a levy year, but only to the extent 
that when added to the preceding year's levy it is not in excess 
of an applicable statutory, special law or charter limitation, 
or the limitation imposed on the governmental subdivision by 
sections 275.50 to 275.56 in the preceding levy year; 
     (h) pay amounts required by law to be paid to pay the 
interest on and to reduce the unfunded accrued liability of 
public pension funds in accordance with the actuarial standards 
and guidelines specified in sections 356.215 and 356.216 reduced 
by 106 percent of the amount levied for that purpose in 1976, 
payable in 1977.  For the purpose of this special levy, the 
estimated receipts expected from the state of Minnesota pursuant 
to sections 69.011 to 69.031 or any other state aid expressly 
intended for the support of public pension funds shall be 
considered as a deduction in determining the required levy for 
the normal costs of the public pension funds.  No amount of 
these aids shall be considered as a deduction in determining the 
governmental subdivision's required levy for the reduction of 
the unfunded accrued liability of public pension funds; 
     (i) to compensate the state for the cost of a reassessment 
ordered by the commissioner of revenue pursuant to section 
270.16; 
     (j) pay the debt service on tax increment financing revenue 
bonds to the extent that revenue to pay the bonds or to maintain 
reserves for the bonds is insufficient as a result of the 
provisions of Laws 1988, chapter 719, article 5; 
     (k) pay the cost of hospital care under section 261.21; 
     (l) pay the unreimbursed costs incurred in the previous 
year to satisfy judgments rendered against the governmental 
subdivision by a court of competent jurisdiction in any tort 
action, or to pay the costs of settlements out of court against 
the governmental subdivision in a tort action when substantiated 
by a stipulation for the dismissal of the action filed with the 
court of competent jurisdiction and signed by both the plaintiff 
and the legal representative of the governmental subdivision, 
provided that an appeal for the unreimbursed costs under this 
clause was approved by the commissioner of revenue under section 
275.51, subdivision 3; 
     (m) pay the expenses reasonably and necessarily incurred in 
preparing for or repairing the effects of natural disaster 
including the occurrence or threat of widespread or severe 
damage, injury, or loss of life or property resulting from 
natural causes such as earthquake, fire, flood, wind storm, wave 
action, oil spill, water contamination, air contamination, or 
drought in accordance with standards formulated by the emergency 
services division of the state department of public safety, 
provided that an appeal for the expenses incurred under this 
clause were approved by the commissioner of revenue under 
section 275.51, subdivision 3; 
     (n) pay a portion of the losses in tax receipts to a city 
due to tax abatements or court actions in the year preceding the 
current levy year, provided that an appeal for the tax losses 
was approved by the commissioner of revenue under section 
275.51, subdivision 3.  This special levy is limited to the 
amount of the losses times the ratio of the nonspecial levies to 
total levies for taxes payable in the year the abatements were 
granted.  County governments are not authorized to claim this 
special levy; 
     (o) pay the operating cost of regional library services 
authorized under section 134.34, subject to a maximum increase 
over the previous year of the greater of (1) 103 percent 
multiplied by one plus the percentage increase determined for 
the governmental subdivision under section 275.51, subdivision 
3h, clause (b), or (2) six percent.  If a governmental 
subdivision elected to include some or all of its levy for 
libraries within its adjusted levy limit base in the prior year, 
but elects to claim the levy as a special levy in the current 
levy year, the allowable increase is determined by applying the 
greater percentage determined under clause (1) or (2) to the 
total amount levied for libraries in the prior levy year.  After 
levy year 1989, the increase must not be determined using a base 
amount other than the amount that could have been levied as a 
special levy in the prior year.  In no event shall the special 
levy be less than the minimum levy required under sections 
134.33 and 134.34, subdivisions 1 and 2; 
     (p) pay the amount of the county building fund levy 
permitted under section 373.40, subdivision 6; 
     (q) pay the county's share of the costs levied in 1989, 
1990, and 1991 for the Minnesota cooperative soil survey under 
Minnesota Statutes 1988, section 40.07, subdivision 15; 
     (r) for taxes levied in 1989, payable in 1990 only, pay the 
cost incurred for the minimum share required by counties levying 
for the first time under section 134.34 as required under 
section 134.341.  For taxes levied in 1990, and thereafter, 
counties levying under this provision must levy under clause 
(o), and their allowable increase must be determined with 
reference to the amount levied in 1989 under this paragraph; 
     (s) for taxes levied in 1989, payable in 1990 only, provide 
an amount equal to 50 percent of the estimated amount of the 
reduction in aids to a county under sections 273.1398, 
subdivision 2, paragraph (d), and 477A.012, subdivision 3, for 
aids payable in 1990; 
     (t) for taxes levied in 1990 only by a county in the eighth 
judicial district, provide an amount equal to the amount of the 
levy, if any, that is required under Laws 1989, chapter 335, 
article 3, section 54, subdivision 8, as amended by section 14; 
    (u) for taxes levied in 1989, payable in 1990 only, pay the 
costs not reimbursed by the state or federal government: 
    (i) for the costs of purchase or delivery of social 
services.  The aggregate amounts levied under this item are 
subject to a maximum increase over the amount levied in the 
previous year of 12 percent for counties within the metropolitan 
area as defined in section 473.121, subdivision 2, or counties 
outside the metropolitan area but containing a city of the first 
class, and 15 percent for other counties. 
    (ii) for payments made to or on behalf of recipients of aid 
under any public assistance program authorized by law.  The 
aggregate amounts levied under this item are subject to a 
maximum increase over the amount levied in the previous year of 
12 percent and must be used only for the public assistance 
programs; and 
    (v) pay an amount of up to 25 percent of the money sought 
for distribution and approved under section 115A.557, 
subdivision 3, paragraph (b), clause (3). 
    If the amount levied in 1989 is less than the actual 
expenditures needed for these programs for 1990, the difference 
between the actual expenditures and the amount levied may be 
levied in 1990 as a special levy.  If the amount levied in 1989 
is greater than the actual expenditures needed for these 
programs for 1990, the difference between the amount levied and 
the actual expenditures shall be deducted from the 1990 levy 
limit, payable in 1991.  
    Sec. 2.  Minnesota Statutes Second 1989 Supplement, section 
275.51, subdivision 3f, as amended by Laws 1990, chapter 480, 
article 7, section 19, is amended to read: 
    Subd. 3f.  [LEVY LIMIT BASE.] (a) The property tax levy 
limit base for governmental subdivisions for taxes levied in 
1988 shall be equal to the total actual levy for taxes payable 
in 1988 with additions and subtractions as specified in 
paragraphs (b) and (c).  
     (b) The amounts to be added to the actual 1988 levy are (1) 
the amount of local government aid the governmental subdivision 
was certified to receive in 1988 under sections 477A.011 to 
477A.014, (2) its 1988 taconite aids under sections 298.28 and 
298.282, and (3) its 1988 wetlands and native prairie 
reimbursements under Minnesota Statutes 1986, sections 273.115, 
subdivision 3, and 273.116, subdivision 3. 
     (c) The amounts to be subtracted from the actual 1988 levy 
are (1) any special levies claimed for taxes payable in 1988 
pursuant to Laws 1987, chapter 268, article 5, section 12, 
subdivision 4, clauses (1), (2), (3), and (4); and (2) for a 
governmental subdivision participating in a regional library 
system receiving grants from the department of education under 
section 134.34, the amount levied for taxes payable in 1988 for 
the operating costs of a public library service.  
     (d) For taxes levied in 1989 and subsequent years, a 
governmental subdivision's levy limit base is equal to its 
adjusted levy limit base for the preceding year, provided that 
for taxes levied in 1989, the amount of the administrative 
reimbursement aid received in 1988 shall be added to the base. 
    (e) For taxes levied by a county in 1989, the levy limit 
base determined under paragraph (d) shall be reduced by an 
amount equal to 90 percent of the cost of public defender 
services for felonies and gross misdemeanors and the costs of 
law clerks in the county that are assumed by the state during 
calendar year 1990, less 103 percent of one-half the amount of 
fees collected by the courts in the county during calendar year 
1988.  For taxes levied in 1990, the levy limit base determined 
under paragraph (d) shall first be increased by the product of 
(1) the amount deducted under this paragraph for taxes levied in 
1989 and (2) the adjustments under subdivision 3h, paragraphs 
(a) and (b) for taxes levied in 1989, and then shall be reduced 
by an amount equal to the cost of public defender services for 
felonies and gross misdemeanors and the cost of law clerks in 
the county that are assumed by the state during calendar year 
1991, less the amount of fees collected by the courts in the 
county during calendar year 1989, computed at the rate of $30 
for civil and probate filings and $20 for marriage dissolutions. 
    (f) For taxes levied in 1989 only, by a county that is 
located in the eighth judicial district, the levy limit base 
determined under paragraphs (d) and (e) shall be further reduced 
by an amount equal to 90 percent of the cost of operation of the 
trial courts in the county during calendar year 1990 that are 
assumed by the state and for which an appropriation is provided, 
less 103 percent of the sum of (1) the remaining one-half of the 
amount of fees and (2) 100 percent of the amount of fines 
collected by the courts in the county during calendar year 
1988.  For taxes levied in 1990 only by those counties, the levy 
limit base determined under paragraphs (d) and (e) shall first 
be increased by the product of (1) the amount deducted under 
this paragraph for taxes levied in 1989 and (2) the adjustments 
under subdivision 3h, paragraphs (a) and (b) for taxes levied in 
1989, and then shall be reduced by an amount equal to the cost 
of operation of the trial courts in the county during the first 
six months of calendar year 1991 that are assumed by the state 
less 50 percent of the amount of fines collected by the courts 
during calendar year 1989. 
    (g) By October 15, 1989, the board of public defense shall 
determine and certify to the commissioner of revenue the pro 
rata share for each county of the state-financed public defense 
services described in paragraph (e) during the six-month period 
beginning July 1, 1990.  By October 15, 1989, the supreme court 
shall determine and certify to the department of revenue for 
each county the pro rata share for each county of the cost of 
providing law clerks during the three-month period beginning 
October 1, 1990, plus, for each county located in the eighth 
judicial district, the cost of operation of the trial courts 
during calendar year 1990. 
    By July 15, 1990, the board of public defense shall 
determine and certify to the department of revenue the pro rata 
share for each county of the state-financed public defense 
services described in paragraph (e) during calendar year 1991.  
By July 15, 1990, the supreme court shall determine and certify 
to the department of revenue for each county the pro rata share 
for each county of the cost of providing law clerks during 
calendar year 1991 plus, for each county located in the eighth 
judicial district, the cost of operation of the trial courts 
during the first six months of 1991. 
     (h) For taxes levied in a county in 1991, the levy limit 
base shall be reduced by an amount equal to the cost in the 
county of court reporters, judicial officers, and district court 
referees and the expenses of law clerks and court reporters as 
authorized in sections 484.545, subdivision 3, and 486.05, 
subdivisions 1 and 1a, as certified by the supreme court 
pursuant to section 477A.012, subdivision 4. 
     (i) If a governmental subdivision received an adjustment to 
its levy limit base for taxes levied in 1988 under section 
275.51, subdivision 3j, its levy limit base for taxes levied in 
1989 must be reduced by the lesser of (1) the adjustment under 
section 275.51, subdivision 3j, or (2) the difference between 
its (i) levy limit for taxes levied in 1988 and its (ii) total 
actual levy for taxes levied in 1988 minus any special levies 
claimed for taxes levied in 1988 under section 275.50, 
subdivision 5. 
    Sec. 3.  Minnesota Statutes Second 1989 Supplement, section 
357.021, subdivision 1a, is amended to read:  
    Subd. 1a.  (a) Every person, including the state of 
Minnesota and all bodies politic and corporate, who shall 
transact any business in the district court, shall pay to the 
court administrator of said court the sundry fees prescribed in 
subdivision 2.  When the public authority responsible for child 
support enforcement is a party to any action or proceeding in 
the district court or according to section 518.551, subdivision 
10, no fee is required under this section.  The court 
administrator shall transmit the fees monthly to the county 
treasurer who shall forward the funds to the state treasurer for 
deposit in the state treasury and credit to the general fund.  
    (b) In a county which has a screener-collector position, 
fees paid by a county pursuant to this subdivision shall be 
transmitted monthly to the county treasurer, who shall apply the 
fees first to reimburse the county for the amount of the salary 
paid for the screener-collector position.  The balance of the 
fees collected shall then be forwarded to the state treasurer 
for deposit in the state treasury and credited to the general 
fund.  A screener-collector position for purposes of this 
paragraph is an employee whose function is to increase the 
collection of fines and to review the incomes of potential 
clients of the public defender, in order to verify eligibility 
for that service. 
    (c) No fee is required under this section from the public 
authority or the party the public authority represents in an 
action for: 
    (1) child support enforcement, medical assistance 
enforcement, or establishment of parentage in the district 
court, or child or medical support enforcement conducted by an 
administrative law judge in an administrative hearing under 
section 518.551, subdivision 10; 
    (2) civil commitment under chapter 253B; 
    (3) the appointment of a public conservator or public 
guardian or any other action under chapters 252A and 525; 
    (4) wrongfully obtaining public assistance under section 
256.98 or 256D.07, or recovery of overpayments of public 
assistance; 
    (5) court relief under chapter 260; 
    (6) forfeiture of property under sections 609.531 to 
609.5317; 
    (7) recovery of amounts issued by political subdivisions or 
public institutions under sections 246.52, 252.27, 256.045, 
256.25, 256.87, 256B.042, 256B.14, 256B.15, 256B.37, and 
260.251, or other sections referring to other forms of public 
assistance; or 
    (8) restitution under section 611A.04. 
    Sec. 4.  Minnesota Statutes 1988, section 477A.012, 
subdivision 3, is amended to read: 
    Subd. 3.  [AID OFFSET FOR COURT COSTS.] (a) There shall be 
deducted from the payment to a county under this section an 
amount representing the cost to the state for assumption of the 
cost (1) of district court administration and operation of the 
trial court information system in the county and, (2) in the 
case of Hennepin and Ramsey counties, of public defense services 
in juvenile and misdemeanor cases in the county and (3) in the 
case of a county that is located in the eighth judicial 
district, of the cost of operation of the trial courts in the 
county during calendar year 1991 less the amount of any special 
levy under Laws 1989, chapter 335, article 3, section 54, 
subdivision 8, as amended by section 14.  The amount of the 
amount of the deduction shall be computed as provided in this 
subdivision.  
    (b) By October 15, 1989, the board of public defense shall 
determine and certify to the department of revenue the cost of 
the state-financed public defense services in juvenile and 
misdemeanor cases for Hennepin and Ramsey counties during the 
fiscal year beginning the following July 1.  By October 15, 
1989, the supreme court shall determine and certify to the 
department of revenue for each county, except counties located 
in the eighth judicial district, the pro rata estimated share 
for each county of district court administration and trial court 
information system costs during the fiscal year beginning on the 
following July 1.  
    (c) One-half of the amount computed under paragraph (b) for 
each county shall be deducted from each payment to the county 
under section 477A.015 in 1990 and each subsequent year.  
One-half of the sum of the amounts computed under paragraph (f) 
shall be deducted from each payment to a county located in the 
eighth judicial district under section 477A.015 in 1991 only; 
except that, if the legislature in its 1991 session does not 
appropriate funds for the operation of the trial courts in the 
eighth judicial district for the period July 1, 1991, through 
December 31, 1991, only 25 percent of the sum of the amounts 
computed under paragraph (f) shall be deducted from each payment 
to each county in the eighth judicial district. 
    (d) If the amount computed under paragraph (b) plus, if 
applicable, the amount deducted under paragraph (e), exceeds the 
amount payable to a county under subdivision 1, the excess shall 
be deducted from the aid payable to the county under section 
273.1398, subdivision 2.  
    (e) By July 15, 1990, the board of public defense and the 
supreme court shall determine and certify to the department of 
revenue the final actual budgeted amounts for the activities 
described in paragraph (b).  If the amount certified under 
paragraph (b) is greater than the amount certified under this 
paragraph, the excess shall be deducted from the aid payable to 
the county in 1991 and each subsequent year under this section.  
If the amount certified under paragraph (b) is less than the 
amount certified under this paragraph, the difference shall be 
added to the aid payable to the county in 1991 and each 
subsequent year under this section. 
    (f) By August 15, 1990, the supreme court shall determine 
and certify to the department of revenue for each county located 
in the eighth judicial district, the county's pro rata estimated 
share of the operation of the trial courts in the county for 
calendar year 1991, less an amount equal to the fees and fines 
collected by the trial courts in the county during calendar year 
1989.  By August 15, 1990, the board of public defense shall 
determine and certify to the department of revenue for each of 
those counties, the county's pro rata estimated share of the 
base funding for the cost of court-appointed defense services 
other than those specified in section 275.51, subdivision 3f, 
for calendar year 1991. 
    Sec. 5.  Minnesota Statutes 1988, section 611.20, is 
amended to read: 
    611.20 [SUBSEQUENT ABILITY TO PAY COUNSEL.] 
    If at any time after the state public defender or a 
district public defender has been directed to act, the court 
having jurisdiction in the matter is satisfied that the 
defendant or other person is financially able to obtain counsel 
or to make partial payment for the representation, the court may 
terminate the appointment of the public defender, unless the 
person so represented is willing to pay therefor.  If a public 
defender continues the representation, the court shall direct 
payment for such representation as the interests of justice may 
dictate.  Any payments directed by the court shall be deposited 
with recorded by the court administrator thereof and the court 
administrator shall forthwith remit the amount thereof to the 
treasurer of the governmental unit chargeable with the 
compensation of such public defender for deposit in the treasury 
to the credit of the general revenue fund of such governmental 
unit or units, who shall transfer the payments to the 
governmental unit responsible for the costs of the public 
defender.  
    If at any time after appointment a public defender should 
have reason to believe that a defendant is financially able to 
obtain counsel or to make partial payment for counsel, it shall 
be the public defender's duty to so advise the court so that 
appropriate action may be taken.  
    Sec. 6.  Minnesota Statutes 1988, section 611.215, 
subdivision 1, is amended to read: 
    Subdivision 1.  [STRUCTURE; MEMBERSHIP.] (a) The state 
board of public defense is a part of, but is not subject to the 
administrative control of, the judicial branch of government.  
The state board of public defense shall consist of seven members 
including: 
    (1) a district court judge appointed by the supreme court; 
    (2) four attorneys admitted to the practice of law, well 
acquainted with the defense of persons accused of crime, but not 
employed as prosecutors, appointed by the supreme court; and 
    (3) two public members appointed by the governor.  
    (b) All members shall demonstrate an interest in 
maintaining a high quality, independent defense system for those 
who are unable to obtain adequate representation.  The terms, 
compensation, and removal of members shall be as provided in 
section 15.0575.  The chair shall be elected by the members from 
among the membership for a term of two years.  
    (c) In addition, the state board of public defense shall 
consist of an 11-member a nine-member ad hoc board when 
considering the appointment of district public defenders under 
section 611.26, subdivision 2.  The terms of district public 
defenders currently serving shall terminate in accordance with 
the staggered term schedule set forth in section 611.26, 
subdivision 2. 
    Sec. 7.  Minnesota Statutes 1989 Supplement, section 
611.26, subdivision 2, is amended to read: 
    Subd. 2.  The state board of public defense shall appoint a 
district public defender.  When appointing a district public 
defender, the state board of public defense membership shall be 
increased to include two judges of the district and two county 
commissioners of the counties within the district.  The 
additional members shall serve only in the capacity of selecting 
the district public defender.  The judges within the district 
shall elect their two ad hoc members.  The two county 
commissioners within the district shall be selected by the 
county boards of the counties within the district.  The ad hoc 
state board of public defense shall appoint a district public 
defender only after requesting and giving reasonable time to 
receive any recommendations from the public, the local bar 
association, and the judges of the district, and the county 
commissioners within the district.  Each district public 
defender shall be a qualified attorney, licensed to practice law 
in this state.  The district public defender shall be appointed 
for a term of four years, beginning November 1, pursuant to the 
following staggered term schedule:  (1) in 1987, the third and 
eighth districts; (2) in 1988, the first and tenth districts; 
(3) in 1989, the fifth and ninth districts; (4) in 1990, the 
sixth and seventh districts; (5) in 1991, the second, fourth 
third, and eighth districts; and (6) in 1992, the first, third 
fourth, and tenth districts.  The district public defenders 
shall serve for staggered four-year terms and may be removed for 
cause upon the order of the state board of public defense.  
Vacancies in the office shall be filled by the appointing 
authority for the unexpired term.  
    Sec. 8.  Minnesota Statutes 1988, section 611.26, 
subdivision 3, is amended to read: 
    Subd. 3.  The compensation of the district public defender 
shall be set by the board of public defense.  The compensation 
of each assistant district public defender shall be set by the 
district public defender with the approval of the board of 
public defense.  The compensation for district public defenders 
may not exceed the prevailing compensation for county attorneys 
within the district, and the compensation for assistant district 
public defenders may not exceed the prevailing compensation for 
assistant county attorneys within the district.  To assist the 
board of public defense in determining prevailing compensation 
under this subdivision, counties shall include in their review 
and comment on proposed district public defender budgets provide 
to the board information on the compensation of county 
attorneys, including salaries and benefits, rent, secretarial 
staff, and other pertinent budget data.  For purposes of this 
subdivision, compensation means salaries, cash payments, and 
employee benefits including paid time off and group insurance 
benefits, and other direct and indirect items of compensation 
including the value of office space provided by the employer. 
    Sec. 9.  Minnesota Statutes 1988, section 611.27, is 
amended to read: 
    611.27 [FINANCING THE OFFICES OF DISTRICT PUBLIC DEFENDER.] 
    Subdivision 1.  (a) The total compensation and expenses, 
including office equipment and supplies, of the district public 
defender are to be paid by the county or counties comprising the 
judicial district. 
    (b) A district public defender shall annually submit a 
comprehensive budget to the state board of public defense.  The 
budget shall be in compliance with standards and forms required 
by the board and must, at a minimum, include detailed 
substantiation as to all revenues and expenditures.  The 
district public defender shall, at times and in the form 
required by the board, submit reports to the board concerning 
its operations, including the number of cases handled and funds 
expended for these services. 
    Within ten days after an assistant district public defender 
is appointed, the district public defender shall certify to the 
state board of public defense the compensation that has been 
recommended for the assistant.  
    (c) The state board of public defense shall transmit the 
proposed budget of each district public defender to the 
respective district court administrators and county budget 
officers for comment before the board's final approval of the 
budget.  The board shall determine and certify to the respective 
county boards a final comprehensive budget for the office of the 
district public defender that includes all expenses.  After the 
board determines the allocation of the state funds authorized 
pursuant to paragraph (e), the board shall apportion the 
expenses of the district public defenders among the several 
counties and each county shall pay its share in monthly 
installments.  The county share is the proportion of the total 
expenses that the population in the county bears to the total 
population in the district as determined by the last federal 
census.  If the district public defender or an assistant 
district public defender is temporarily transferred to a county 
not situated in that public defender's judicial district, said 
county shall pay the proportionate part of that public 
defender's expenses for the services performed in said county.  
    (d) Reimbursement for actual and necessary travel expenses 
in the conduct of the office of the district public defender 
shall be charged to either (1) the general expenses of the 
office, (2) the general expenses of the district for which the 
expenses were incurred if outside the district, or (3) the 
office of the state public defender if the services were 
rendered for that office. 
    (e) Money appropriated to the state board of public defense 
for the board's administration, for the state public defender, 
for the judicial district public defenders, and the public 
defender must be spent with the approval of the state board of 
public defense for the board's administration and for thestate 
public defender and public defense corporations in amounts 
determined by the board for the public defense corporations 
shall be expended as determined by the board.  Funds may also be 
distributed by the state board of public defense to district 
public defenders including those in Hennepin and Ramsey 
counties.  In making distributions to district public defenders, 
priority must be given, to the extent feasible and reasonable, 
to those districts having the greatest number of felonies and 
gross misdemeanors, and to those districts having the greatest 
number of distressed counties designated under section 
297A.257.  The board shall further consider each district's 
number of dispositions, such as jury trials, court trials and 
guilty pleas, the number of court appearances, and other 
trial-related financial data, and any special needs of districts 
organized in the calendar year 1987 In distributing funds to 
district public defenders, the board shall consider the results 
of the weighted case load study. 
    Subd. 2.  The state board of public defense, after 
consultation with the county boards receiving an appropriation 
from the legislature for payment of district public defender 
costs, shall designate the county officials of one or more 
counties county within the district as a host county to pay 
reimburse the expenses of the district public defender.  A 
county selected by the board must serve as the designee.  The 
county share assessed under subdivision 1 against each county of 
the district must be paid to the county treasurer of the 
designated county.  The board may reimburse the 
designated counties county for extra costs incurred.  The board 
must provide for a revolving fund in the custody of the 
officials of the designated county into which each county must 
pay an initial deposit and its respective share of the expenses 
of the office of district public defender and from which the 
expenses of said office shall be paid in the manner provided in 
Laws 1965, chapter 869.  
    Subd. 3.  If the state public defender or a district public 
defender deems it necessary to make a motion for a new trial, to 
take an appeal, or other postconviction proceedings in order to 
properly represent a defendant or other person whom that public 
defender had been directed to represent, that public defender 
may use the transcripts of the testimony and other proceedings 
filed with the court administrator of the district court as 
provided by section 243.49. 
    Subd. 4.  [COUNTY PORTION OF COSTS.] The effective date of 
this section shall be January 1, 1966.  That portion of 
subdivision 1 directing counties to pay the costs of public 
defense service shall not be in effect between July 1, 1990, and 
July 1, 1991.  This subdivision only relates to costs associated 
with felony and gross misdemeanor public defense services and 
all public defense services in the second, fourth, and eighth 
judicial districts. 
    Sec. 10.  Minnesota Statutes 1988, section 611.271, is 
amended to read: 
    611.271 [COPIES OF DOCUMENTS; FEES.] 
    The court administrators of all courts and justices of 
peace shall furnish upon the request of the office of district 
public defender or the state public defender copies of any 
documents in their possession and shall bill the office of the 
state public defender for these copies after they have been 
furnished.  The fees for such documents shall be $2 plus 12 
cents for each page of the documents furnished at no charge to 
the public defender.  
    Sec. 11.  Minnesota Statutes 1988, section 629.292, 
subdivision 1, is amended to read: 
    Subdivision 1.  [REQUEST FOR DISPOSITION; NOTIFICATION OF 
PRISONER.] (a) Any person who is imprisoned in a penal or 
correctional institution or other facility in the department of 
corrections of this state may request final disposition of any 
untried indictment or information complaint pending against the 
person in this state.  The request shall be in writing addressed 
to the court in which the indictment or information complaint is 
pending and to the prosecuting attorney charged with the duty of 
prosecuting it, and shall set forth the place of imprisonment.  
    (b) The commissioner of corrections or other official 
designated by the commissioner having custody of prisoners shall 
promptly inform each prisoner in writing of the source and 
nature of any untried indictment or information complaint 
against the prisoner of which the commissioner of corrections or 
such official had knowledge or notice and of the prisoner's 
right to make a request for final disposition thereof.  
    (c) Failure of the commissioner of corrections or other 
such official to inform a prisoner, as required by this section, 
within one year after a detainer has been filed at the 
institution shall entitle the prisoner to a final dismissal of 
the indictment or information complaint with prejudice.  
    Sec. 12.  Laws 1989, chapter 335, article 3, section 38, is 
amended to read: 
    Sec. 38.  [TRANSITION, PUBLIC DEFENDERS; SECOND AND FOURTH 
DISTRICTS.] 
    The district public defender defenders of the second and 
fourth judicial district districts serving on July 1, 1989, 
shall continue in office until the expiration of the term to 
which appointed or until August 1, 1991, whichever date is later 
their terms. 
    The district public defender of the fourth judicial 
district serving on July 1, 1989, shall continue in office until 
the expiration of the term to which appointed or until August 1, 
1991, whichever date is later. 
    Sec. 13.  Laws 1989, chapter 335, article 3, section 44, is 
amended to read:  
    Sec. 44.  [APPLICATION.] 
    Sections 45 to 54, except the parts of section 54, that by 
their terms have broader application, apply only in the eighth 
judicial district for the period from January 1, 1990, to June 
30 December 31, 1991.  
    Those parts of section 54, having broader application, 
apply statewide for the period from July 1, 1989, to June 30 
December 31, 1991. 
    Sec. 14.  Laws 1989, chapter 335, article 3, section 54, 
subdivision 8, is amended to read:  
    Subd. 8.  [LEVY.] During the pilot project For taxes 
payable in 1991 only the counties that make up the eighth 
judicial district shall continue to levy for and pay the costs 
to operate the eighth judicial district and public defense 
services that the state does not fund during the eighth district 
project.  The supreme court shall certify to the counties on or 
before October 1 of each year August 15, 1990, the amount 
necessary in excess of the state-funded eighth district project 
costs.  The counties are responsible on a per capita prorated 
basis for the costs that the state is not assuming.  These 
include but are not limited to capital costs, rent, and other 
associated costs.  The county administrator of each of the 
counties shall consult with the supreme court and the eighth 
judicial district administrator regarding these costs before 
setting county budgets and levies for calendar year 1990.  Each 
county shall pay its assessed share to the state court 
administrator for the operation of the pilot project on or 
before May 15, 1991. 
    Sec. 15.  Laws 1989, chapter 335, article 3, section 58, as 
amended by Laws 1989, chapter 356, section 67, and Laws 1989, 
First Special Session chapter 1, article 5, section 48, 
subdivision 3, is amended to read:  
    Subd. 3.  [JANUARY 1, 1991; ALL DISTRICTS.] That portion of 
section 6 which amends the first sentence of Minnesota Statutes 
1989 Supplement, section 357.021, subdivision 1a, requiring 
counties to pay filing fees in district court actions is 
effective January 1, 1991 1992, for counties in all judicial 
districts. 

                               ARTICLE 10

                             MISCELLANEOUS 
    Section 1.  Minnesota Statutes Second 1989 Supplement, 
section 3.885, subdivision 8, is amended to read: 
    Subd. 8.  [POLITICAL SUBDIVISION REPORTING.] No later than 
November 15, 1990 1991, the commission shall make 
recommendations to appropriate standing committees of the 
legislature on any changes in uniform accounting and financial 
reporting methods necessary to assure public and legislative 
oversight of expenditures by cities, counties, towns, and 
special service districts.  The recommendations shall consider 
opportunities for on-line access by appropriate state officers 
to political subdivision accounts.  In preparing these 
recommendations, the commission shall consult with the state 
auditor, the legislative auditor, and the commissioners of 
finance and revenue.  
    Sec. 2.  Minnesota Statutes 1988, section 3.885, is amended 
by adding a subdivision to read: 
    Subd. 9.  [LOCAL GOVERNMENT RULE APPEALS.] Any local 
government may appeal to the commission to review any existing 
or proposed rule as defined in section 14.02, subdivision 4, on 
the grounds that the rule imposes a fiscal or administrative 
burden on local governments which is unnecessary in order for 
the local governments to accomplish the statewide policy goals 
and requirements of the statute authorizing the rule.  As used 
in this subdivision, a "local government" is a county, home rule 
charter or statutory city, or town.  The commission may hold a 
public hearing on a local government's appeal of a rule and may, 
on the basis of testimony received at the public hearing, 
suspend any rule by affirmative vote of at least half of its 
members.  The procedures provided in sections 14.40, subdivision 
4, 14.42, and 14.43, shall apply to suspension of rules under 
this subdivision. 
    Sec. 3.  Minnesota Statutes Second 1989 Supplement, section 
3.982, is amended to read: 
    3.982 [FISCAL NOTES FOR STATE-MANDATED ACTIONS.] 
    When a bill proposing a new or expanded mandate on a 
political subdivision is introduced and referred to a standing 
committee, the head of each affected department or agency of the 
state government shall the commissioner of finance shall 
determine whether the bill proposes a new or expanded mandate on 
a political subdivision.  If the commissioner determines that a 
new or expanded mandate is proposed, the commissioner shall 
direct the appropriate department or agency of state government 
to prepare a fiscal note identifying the projected fiscal impact 
of the bill on state government and on the affected political 
subdivisions.  The commissioner of finance shall be responsible 
for coordinating the fiscal note process, for assuring the 
accuracy and completeness of the note, and for ensuring that 
fiscal notes are prepared, delivered, and updated as provided in 
this section.  The fiscal note shall categorize mandates as 
program or nonprogram mandates and shall include estimates of 
the levy impacts of the mandates.  To the extent that the bill 
would impose new fiscal obligations on political subdivisions, 
the note shall indicate the efforts made to reduce those 
obligations, including consultations made with representatives 
of the political subdivisions.  Chairs of legislative committees 
receiving bills on rereferrals from other legislative committees 
may request that fiscal notes be amended to reflect amendments 
made to the bills by prior committee action.  Preparation of the 
fiscal notes required in this section shall be consistent with 
section 3.98.  The commissioner of finance shall periodically 
report to and consult with the legislative commission on 
planning and fiscal policy on the issuance of the notes.  
    Sec. 4.  Minnesota Statutes 1988, 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 the commissioner of finance determines that there 
will be a positive unrestricted budgetary general fund balance 
at the close of the biennium, the commissioner of finance must 
allocate money to the budget and cash flow reserve account until 
the total amount in the account equals five percent of total 
general fund appropriations for the current biennium as 
established by the most recent legislative session.  Beginning 
in November 1990, forecast unrestricted budgetary general fund 
balances are first appropriated to restore the budget and cash 
flow reserve account to $550,000,000 and then to reduce the 
property tax levy recognition percent under section 121.904, 
subdivision 4a, to 27 percent before money is allocated to the 
budget and cash flow reserve account under the preceding 
sentence.  
    The amounts necessary to meet the requirements of this 
section are appropriated from the general fund. 
    Sec. 5.  Minnesota Statutes 1989 Supplement, section 
115A.981, subdivision 3, is amended to read:  
    Subd.  3.  [AGENCY REPORT.] The agency shall report to the 
legislative commission on waste management by July 1 of each 
year on the viability of the state's waste processing and 
disposal capability, the status of competitive forces in the 
market including recycling, composting, waste reduction and 
incineration, the extent to which existing fees for services are 
sufficient for facility development, engineering, environmental 
and safety factors, the progress of the industry in meeting the 
state's waste management goals, and recommendations for 
regulations to ensure protection of human health and the 
environment.  In preparing the report, the agency shall consider 
information received under subdivision 2. 
    The report must also include: 
    (1) statewide and facility by facility estimates of the 
total potential costs and liabilities associated with solid 
waste disposal facilities for closure and postclosure care, 
response costs under chapter 115B, and any other potential 
costs, liabilities, or financial responsibilities; 
    (2) statewide and facility by facility requirements for 
proof of financial responsibility under section 116.07, 
subdivision 4h; and 
    (3) an annual update addressing how each facility is 
meeting its financial responsibility under section 116.07, 
subdivision 4h. 
    Sec. 6.  Minnesota Statutes 1988, section 116.07, 
subdivision 4h, is amended to read:  
    Subd. 4h.  [FINANCIAL RESPONSIBILITY RULES.] (a) The agency 
shall adopt rules requiring the operator or owner of a solid 
waste disposal facility to submit to the agency proof of the 
operator's or owner's financial capability to provide reasonable 
and necessary response during the operating life of the facility 
and for 20 years after closure, and to provide for the closure 
of the facility and postclosure care required under agency 
rules.  Proof of financial responsibility is required of the 
operator or owner of a facility receiving an original permit or 
a permit for expansion after adoption of the rules.  Within 180 
days of the effective date of the rules or by July 1, 1987, 
whichever is later, proof of financial responsibility is 
required of an operator or owner of a facility with a remaining 
capacity of more than five years or 500,000 cubic yards that is 
in operation at the time the rules are adopted.  Compliance with 
the rules is a condition of obtaining or retaining a permit to 
operate the facility. 
    (b) The agency shall amend the rules adopted under 
paragraph (a) to allow a municipality, as defined in section 
475.51, subdivision 2, including a sanitary district, that owns 
or operates a solid waste disposal facility that was in 
operation on May 15, 1989, to meet its financial responsibility 
for all or a portion of the contingency action portion of the 
reasonable and necessary response costs at the facility through 
its authority to issue bonds, provided that the method developed 
in the rules will ensure that when funds are needed for a 
contingency action, sufficient bonds can and will be issued by 
the municipality to meet its responsibility.  The rules must 
include at least: 
     (1) a requirement that the governing body of the 
municipality enact an ordinance that clearly accepts 
responsibility for the costs of contingency action at the 
facility and that reserves, during the operating life of the 
facility and for 20 years after closure, a portion of the debt 
limit of the municipality, as established under section 475.53 
or other law, that is equal to the total contingency action 
costs calculated under the rules; 
    (2) a requirement that the municipality assure that all 
collectors that haul to the facility implement a plan for 
reducing solid waste by using volume-based pricing, recycling 
incentives, or other means; 
     (3) a requirement that when a municipality opts under the 
rules to meet a portion of its financial responsibility by 
relying on its authority to issue bonds, it shall also begin 
setting aside funds that will cover a portion of the potential 
contingency action costs at the facility, the amount to be 
determined by the agency for each facility based on at least the 
amount of waste deposited in the disposal facility each year, 
and the likelihood and potential timing of conditions arising at 
the facility that will necessitate response action; and 
    (4) a requirement that a municipality have and consistently 
maintain an investment grade bond rating as a condition of using 
bonding authority to meet financial responsibility under this 
section. 
    (c) Counties shall comply with existing financial 
responsibility rules until those rules are amended under 
paragraph (b), and, after that time, counties shall comply with 
the amended rules.  The method for proving financial 
responsibility developed under paragraph (b) may not be applied 
to a new solid waste disposal facility or to expansion of an 
existing facility. 
    Sec. 7.  [116J.871] [FINANCIAL ASSISTANCE LIMITATIONS; 
PREVAILING WAGE.] 
    Subdivision 1.  [DEFINITIONS.] (a) For the purposes of this 
section, the following terms have the meanings given them. 
    (b) "Economic development" means financial assistance 
provided to a person directly or to a local unit of government 
or nonprofit organization on behalf of a person who is engaged 
in the manufacture or sale of goods and services.  Economic 
development does not include (i) financial assistance for 
rehabilitation of existing housing or (ii) financial assistance 
for new housing construction in which total financial assistance 
at a single project site is less than $100,000. 
    (c) "Financial assistance" means (i) a grant awarded by a 
state agency for economic development related purposes if a 
single business receives $200,000 or more of the grant proceeds; 
(ii) a loan or the guaranty or purchase of a loan made by a 
state agency for economic development related purposes if a 
single business receives $500,000 or more of the loan proceeds; 
or (iii) a reduction, credit, or abatement of a tax assessed 
under chapter 297A where the tax reduction, credit, or abatement 
applies to a geographic area smaller than the entire state and 
was granted for economic development related purposes.  
Financial assistance does not include payments by the state of 
aids and credits under chapter 273 or 477A to a political 
subdivision. 
    (d) "Project site" means the location where improvements 
are made that are financed in whole or in part by the financial 
assistance; or the location of employees that receive financial 
assistance in the form of employment and training services as 
defined in section 268.0111, subdivision 4, or customized 
training from a technical college. 
    (e) "State agency" means any agency defined under section 
16B.01, subdivision 2, the Greater Minnesota Corporation, and 
the iron range resources and rehabilitation board. 
    Subd. 2.  [PREVAILING WAGE REQUIRED.] A state agency may 
provide financial assistance to a person only if the person 
receiving or benefiting from the financial assistance certifies 
to the commissioner of labor and industry that laborers and 
mechanics at the project site during construction, installation, 
remodeling, and repairs for which the financial assistance was 
provided will be paid the prevailing wage rate as defined in 
section 177.42, subdivision 6. 
    Subd. 3.  [PREVAILING WAGE; PENALTY.] It is a misdemeanor 
for a person who has certified that prevailing wages will be 
paid to laborers and mechanics under subdivision 2 to 
subsequently fail to pay the prevailing wage.  This misdemeanor 
is punishable by a fine of not more than $700, or imprisonment 
for not more than 90 days, or both.  Each day a violation of 
this subdivision continues is a separate offense. 
    Subd. 4.  [NOTIFICATION.] A state agency shall notify any 
person applying for financial assistance from the state agency 
of the requirements under subdivision 2 and of the penalties 
under subdivision 3. 
    Subd. 5.  [EXCEPTION.] Nothing in this section denies any 
financial assistance granted to or qualified for by a person 
whose construction, installation, remodeling, or repairs 
commenced prior to August 1, 1990. 
    Sec. 8.  [STUDY OF PREVAILING WAGE SYSTEM.] 
    Subdivision 1.  [STUDY REQUIRED; CONTENTS.] The management 
analysis division of the department of administration shall 
study and evaluate the prevailing wage system in this state.  
The study must analyze: 
    (1) whether the method of determining prevailing wage rates 
is adequate and reasonable; 
    (2) whether current enforcement of the law is consistent 
with the intent of Minnesota Statutes, sections 177.41 to 
177.44; and 
    (3) the variations in prevailing wage rates among counties 
in Minnesota and between Minnesota and federal prevailing wage 
rates. 
    Subd. 2.  [REPORT.] The commissioner of administration 
shall report its findings to the legislature by February 1, 1991.
    Subd. 3.  [APPROPRIATION.] $100,000 is appropriated from 
the general fund to the commissioner of administration to meet 
the cost of conducting the study. 
    Sec. 9.  [270.0682] [TAX INCIDENCE REPORTS.] 
    Subdivision 1.  [BIENNIAL REPORT.] The commissioner of 
revenue shall report to the legislature by March 1 of each 
odd-numbered year on the overall incidence of the income tax, 
sales and excise taxes, and property tax.  The report shall 
present information on the distribution of the tax burden (1) 
for the overall income distribution, using a systemwide 
incidence measure such as the Suits index or other appropriate 
measures of equality and inequality, (2) by income classes, 
including at a minimum deciles of the income distribution, and 
(3) by other appropriate taxpayer characteristics. 
    Subd. 2.  [BILL ANALYSES.] At the request of the chair of 
the house tax committee or the senate committee on taxes and tax 
laws, the commissioner of revenue shall prepare an incidence 
impact analysis of a bill or a proposal to change the tax system 
which increases, decreases, or redistributes taxes by more than 
$20,000,000.  To the extent data is available on the changes in 
the distribution of the tax burden that are affected by the bill 
or proposal, the analysis shall report on the incidence effects 
that would result if the bill were enacted.  The report may 
present information using systemwide measures, such as Suits or 
other similar indexes, by income classes, taxpayer 
characteristics, or other relevant categories.  The report may 
include analyses of the effect of the bill or proposal on 
representative taxpayers.  The analysis must include a statement 
of the incidence assumptions that were used in computing the 
burdens. 
    Subd. 3.  [INCOME MEASURE.] The incidence analyses shall 
use the broadest measure of economic income for which reliable 
data is available. 
    Sec. 10.  Minnesota Statutes 1988, section 279.06, is 
amended to read: 
    279.06 [COPY OF LIST AND NOTICE.] 
    Subdivision 1.  [LIST AND NOTICE.] Within five days after 
the filing of such list, the court administrator shall return a 
copy thereof to the county auditor, with a notice prepared and 
signed by the court administrator, 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 court administrator 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 court administrator, 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 25, paragraph (d)(1) 
or (c)(4), 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) ............................................., 
    Court Administrator 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. 
    Subd. 2.  [FORM OF LIST AND NOTICE.] Notwithstanding the 
provisions of subdivision 1, the commissioner of revenue shall 
prescribe the form of the list and notice required under 
subdivision 1.  The form shall contain the information required 
under subdivision 1, but shall be organized and presented in a 
manner easily read and understood.  The print must be easily 
read and contain standard use of capital and lower-case 
letters.  The court administrator shall use the form prescribed 
by the commissioner for purposes of this section. 
    Sec. 11.  [289A.65] [ADMINISTRATIVE REVIEW.] 
    Subdivision 1.  [TAXPAYER RIGHT TO RECONSIDERATION.] A 
taxpayer may obtain reconsideration by the commissioner of an 
order assessing tax, a denial of a request for abatement of 
penalty, or a denial of a claim for refund by filing an 
administrative appeal under subdivision 4.  A taxpayer cannot 
obtain reconsideration under this section if the action taken by 
the commissioner is the outcome of an administrative appeal. 
    Subd. 2.  [APPEAL BY TAXPAYER.] A taxpayer who wishes to 
seek administrative review must follow the procedures in 
subdivision 4.  
    Subd. 3.  [NOTICE DATE.] For purposes of this section, the 
term "notice date" means the date of the order adjusting the tax 
or order denying a request for abatement, or, in the case of a 
denied refund, the date of the notice of denial.  
    Subd. 4.  [TIME AND CONTENT FOR ADMINISTRATIVE APPEAL.] 
Within 60 days after the notice date, the taxpayer must file a 
written appeal with the commissioner.  The appeal need not be in 
any particular form but must contain the following information:  
    (1) name and address of the taxpayer; 
    (2) if a corporation, the state of incorporation of the 
taxpayer, and the principal place of business of the 
corporation; 
    (3) the Minnesota identification number or social security 
number of the taxpayer; 
    (4) the type of tax involved; 
    (5) the date; 
    (6) the tax years or periods involved and the amount of tax 
involved for each year or period; 
    (7) the findings in the notice that the taxpayer disputes; 
    (8) a summary statement that the taxpayer relies on for 
each exception; and 
    (9) the taxpayer's signature or signature of the taxpayer's 
duly authorized agent.  
    Subd. 5.  [EXTENSIONS.] When requested in writing and 
within the time allowed for filing an administrative appeal, the 
commissioner may extend the time for filing an appeal for a 
period not more than 30 days from the expiration of the 60 days 
from the notice date.  
    Subd. 6.  [DETERMINATION OF APPEAL.] On the basis of 
applicable law and available information, the commissioner shall 
determine the validity, if any, in whole or part of the appeal 
and notify the taxpayer of the decision.  This notice must be in 
writing and contain the basis for the determination.  
    Subd. 7.  [AGREEMENT DETERMINING TAX LIABILITY.] When it 
appears to be in the best interests of the state, the 
commissioner may settle any taxes, penalties, or interest that 
the commissioner has under consideration by virtue of an appeal 
filed under this section.  An agreement must be in writing and 
signed by the commissioner and the taxpayer, or the taxpayer's 
representative authorized by the taxpayer to enter into an 
agreement.  The agreement must be filed in the office of the 
commissioner.  
    Subd. 8.  [APPEAL OF AN ADMINISTRATIVE DETERMINATION.] 
Following the determination or settlement of an appeal and 
notwithstanding any period of limitations for making assessments 
or other determinations to the contrary, the commissioner must 
issue an order reflecting that disposition.  If the statute of 
limitations for making assessments or other determinations would 
have expired before the issuance of this order, except for this 
section, the order is limited to issues or matters contained in 
the appealed determination.  Except in the case of an agreement 
determining tax under this section, the order is appealable to 
the Minnesota tax court under section 271.06. 
    Subd. 9.  [APPEAL WHERE NO DETERMINATION.] If the 
commissioner does not make a determination within six months of 
the filing of an administrative appeal, the taxpayer may elect 
to appeal to tax court.  
    Subd. 10.  [EXEMPTION FROM ADMINISTRATIVE PROCEDURE ACT.] 
This section is not subject to chapter 14. 
    Sec. 12.  Minnesota Statutes 1988, section 296.02, 
subdivision 1a, is amended to read: 
    Subd. 1a.  [EXCEPTIONS.] The provisions of subdivision 1 do 
not apply to (1) gasoline purchased by a transit system owned by 
one or more statutory or home rule charter cities or 
towns receiving financial assistance under section 174.24 or 
473.384, or (2) to sales of compressed natural gas or propane 
for use in vehicles displaying a valid annual alternate fuel 
permit. 
    Sec. 13.  Minnesota Statutes 1988, section 296.025, 
subdivision 1a, is amended to read: 
    Subd. 1a.  [EXCEPTIONS.] The provisions of subdivision 1 do 
not apply to (1) special fuel purchased by a transit system 
owned by one or more statutory or home rule charter cities or 
towns receiving financial assistance under section 174.24 or 
473.384, or (2) to sales of compressed natural gas or propane 
for use in vehicles displaying a valid annual alternate fuel 
permit. 
    Sec. 14.  Minnesota Statutes 1988, section 297.07, 
subdivision 5, is amended to read: 
    Subd. 5.  [OFFSET.] Upon audit, if a distributor's return 
reflects an overpayment, the overpayment may only be offset 
against an additional tax liability for the month immediately 
preceding or immediately after the month of 
overpayment. overage, the overage shall be offset against a 
shortage, if any, in the month immediately preceding the month 
of the overage.  If any overage remains after that offset, the 
remainder may only be offset against a shortage, if any, in the 
month immediately following the month of the overage. 
    Sec. 15.  Minnesota Statutes 1988, section 298.015, 
subdivision 1, is amended to read: 
    Subdivision 1.  [TAX IMPOSED.] A person engaged in the 
business of mining shall pay to the state of Minnesota for 
distribution as provided in section 298.018 a net proceeds tax 
equal to two percent of the net proceeds from mining in 
Minnesota.  The tax applies to all mineral and energy resources 
mined or extracted within the state of Minnesota except for 
sand, silica sand, gravel, building stone, crushed rock, 
limestone, granite, dimension granite, dimension stone, 
horticultural peat, clay, soil, iron ore, and taconite 
concentrates.  The tax is in addition to all other taxes 
provided for by law.  The tax is due by June 15 of the year 
succeeding the calendar year covered by the report required by 
section 298.05. 
    Sec. 16.  Minnesota Statutes 1988, section 298.017, is 
amended to read: 
    298.017 [DEDUCTIONS.] 
    Subdivision 1.  [DEDUCTIONS NOT ALLOWED.] For purposes of 
calculating the net proceeds under section 298.015, the 
following expenses are not deductible:  (1) all sales, 
marketing, and interest expenses; (2) all insurance expense and 
taxes, except as specifically provided in this section; (3) all 
administrative expenses outside of Minnesota; (4) any research 
expense prior to production; (5) all funds set aside during 
production years to pay for reclamation expenses after 
production ends; (6) royalty expenses, depletion allowances, and 
cost of mining land.  
    Subd. 2.  [DEDUCTIONS ALLOWED.] (a) In calculating the net 
proceeds for the purpose of determining the tax provided in 
section 298.015, only those expenses specifically allowed in 
this subdivision may be deducted from gross proceeds.  The 
carryback or carryforward of deductions shall not be allowed.  
    (b) Ordinary and necessary expenses actually paid for the 
mining, production, processing, beneficiation, smelting, or 
refining of metal or mineral products for: 
    (1) labor, including wages, salaries, fringe benefits, 
unemployment and workers' compensation insurance; 
    (2) machinery, equipment, and supplies, including any sales 
and use tax paid on it, except that machinery and equipment 
subject to depreciation shall only be deductible under clause 
(b)(3); 
    (3) depreciation as defined and allowed by section 167 of 
the Internal Revenue Code of 1986, as amended through December 
31, 1986; and 
    (4) administrative expenses inside Minnesota; and 
    (5) reclamation costs actually incurred in Minnesota and 
paid in a year of production, including the payment of bonds 
required by the provisions of an environmental permit issued by 
the state of Minnesota 
are deductible.  
    (c) Ordinary and necessary expenses of transporting metal 
or mineral products are allowed as a deduction if the costs are 
included in the sale price of the products.  
    (d) Expenses of exploration, research, or development in 
this state for the mining and processing of minerals within 
Minnesota paid in a production year are deductible in the 
production year.  
    (e) Expenses of exploration and development in Minnesota 
incurred prior to production must be amortized and deducted on a 
straight-line basis over the first five years of production.  
    Sec. 17.  Minnesota Statutes 1988, section 298.05, is 
amended to read: 
    298.05 [MINING COMPANIES TO REPORT ANNUALLY.] 
    Every person engaged in such mining or production of ores 
shall, annually, on or before the first day of March 15, file 
with the commissioner of revenue, under oath, a correct report, 
in such form and containing such information as the commissioner 
may require, covering the preceding calendar year.  
    Sec. 18.  Minnesota Statutes 1988, section 298.24, 
subdivision 1, is amended to read: 
    Subdivision 1.  (a) For concentrate produced in 1986 and 
1987 1990 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 $1.90 $1.975 per gross ton of 
merchantable iron ore concentrate produced therefrom.  
    (b) Except as provided in paragraph (c), For concentrates 
produced in 1988 1991 and subsequent years, the tax rate shall 
be equal to the preceding year's tax rate plus an amount equal 
to the preceding year's tax rate 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" for the gross 
national product means the implicit price deflator prepared by 
the bureau of economic analysis of the United States Department 
of Commerce.  
    (c) The provisions of paragraph (b) will not be in effect 
for concentrates produced in 1988 if the 1988 production is not 
less than 34,000,000 tons.  If the provisions of paragraph (b) 
are not in effect for concentrates produced in a year, the rate 
of the tax for that year's production will be the rate of the 
tax imposed on the previous year's production.  The tax shall be 
imposed on 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 $1.90 $1.975 per gross ton of merchantable iron ore 
concentrate produced shall be imposed.  
    (e) Consistent with the intent of this subdivision to 
impose a tax based upon the weight of merchantable iron ore 
concentrate, the commissioner of revenue may indirectly 
determine the weight of merchantable iron ore concentrate 
included in fluxed pellets by subtracting the weight of the 
limestone, dolomite, or olivine derivatives or other basic flux 
additives included in the pellets from the weight of the 
pellets.  For purposes of this paragraph, "fluxed pellets" are 
pellets produced in a process in which limestone, dolomite, 
olivine, or other basic flux additives are combined with 
merchantable iron ore concentrate.  No subtraction from the 
weight of the pellets shall be allowed for binders, mineral and 
chemical additives other than basic flux additives, or moisture. 
    Sec. 19.  Minnesota Statutes 1988, section 469.171, is 
amended by adding a subdivision to read: 
    Subd. 11.  [LIMITATIONS; LAST EIGHT MONTHS OF 
DURATION.] This subdivision applies only to state tax reductions 
first authorized by the municipality to be provided to a 
business within eight months of the expiration of the enterprise 
zone's designation. 
    Before agreeing with a business to provide tax reductions, 
the municipality must submit the proposed tax reductions to the 
commissioner for approval.  The commissioner shall review and 
analyze the proposal in light of, at least, (1) the proposed 
investment that the business will make in the zone, (2) the 
number and quality of new jobs that will be created in the zone, 
(3) the overall positive impact on economic activity in the 
zone, and (4) the extent to which the impacts in clauses (1) to 
(3) are dependent upon providing the state tax reductions to the 
business.  The commissioner shall disapprove the proposal if the 
commissioner determines the public benefits of increased 
investment and employment resulting from the tax reductions is 
disproportionately small relative to the cost of the state tax 
reductions.  If the commissioner disapproves of the proposal, 
the tax reductions are not allowed to the business. 
    If the municipality submits the proposal to the 
commissioner before expiration of the zone designation, the 
authority to grant the tax reductions continues until the 
commissioner acts on the proposal. 
    Sec. 20.  Minnesota Statutes 1988, section 473.845, 
subdivision 4, is amended to read: 
    Subd. 4.  [EXPENDITURE NOTIFICATION AND COMMISSION 
RECOMMENDATION.] (a) The commissioner shall notify the chair and 
the director of the legislative commission on waste management 
before making expenditures from the fund.  
    (b) The legislative commission on waste management shall 
make recommendations to the standing legislative committees on 
finance and appropriations about appropriations from the fund. 
    Sec. 21.  Minnesota Statutes 1988, section 475.53, is 
amended by adding a subdivision to read: 
    Subd. 7.  [DEBT LIMIT RESERVATION.] A municipality may, by 
ordinance, reserve a portion of its unencumbered debt limit for 
the purpose of providing proof of financial responsibility for 
the contingency action portion of the response costs at a solid 
waste disposal facility, subject to the rules adopted by the 
pollution control agency under section 116.07, subdivision 4h.  
Reservation of a portion of a municipality's debt limit under 
this subdivision may not be revoked by the municipality until 
the expiration of the required time period for maintaining proof 
of financial responsibility or the municipality adopts and 
adequately funds, as of the date of implementation, an alternate 
method of financial responsibility under the rules of the 
agency, whichever occurs earlier.  If the municipality reserves 
its debt limit under this subdivision, the debt limit is 
computed as if the municipality had issued obligations, subject 
to the limit, in the amount of the reservation specified in the 
ordinance.  Notwithstanding the amount of market value in the 
municipality, the reserved amount of the limit is available for 
issuance of bonds to pay the municipality's response costs. 
    Sec. 22.  Minnesota Statutes 1988, section 500.24, 
subdivision 4, is amended to read: 
    Subd. 4.  [REPORTS.] (a) The chief executive officer of 
every pension or investment fund, corporation, or limited 
partnership, except a family farm corporation or a family farm 
limited partnership, that holds any interest in agricultural 
land or land used for the breeding, feeding, pasturing, growing, 
or raising of livestock, dairy or poultry, or products thereof, 
or land used for the production of agricultural crops or fruit 
or other horticultural products, other than a bona fide 
encumbrance taken for purposes of security, or which is engaged 
in farming or proposing to commence farming in this state after 
May 20, 1973, shall file with the commissioner of agriculture a 
report containing the following information and documents: 
     (1) The name of the pension or investment fund, 
corporation, or limited partnership and its place of 
incorporation, certification, or registration; 
     (2) The address of the pension or investment plan 
headquarters or of the registered office of the corporation in 
this state, the name and address of its registered agent in this 
state and, in the case of a foreign corporation or limited 
partnership, the address of its principal office in its place of 
incorporation, certification, or registration; 
     (3) The acreage and location listed by quarter-quarter 
section, township and county of each lot or parcel of land in 
this state owned or leased by the pension or investment fund, 
limited partnership, or corporation and used for the growing of 
crops or the keeping or feeding of poultry or livestock; 
     (4) The names and addresses of the officers, 
administrators, directors or trustees of the pension or 
investment fund, or of the officers, shareholders owning more 
than ten percent of the stock, including the percent of stock 
owned by each such shareholder, and the members of the board of 
directors of the corporation, and the general and limited 
partners and the percentage of interest in the partnership by 
each partner; 
     (5) The farm products which the pension or investment fund, 
limited partnership, or corporation produces or intends to 
produce on its agricultural land; 
     (6) With the first report, a copy of the title to the 
property where the farming operations are or will occur 
indicating the particular exception claimed under subdivision 3, 
clauses (a) to (r); and 
     (7) With the first or second report, a copy of the 
conservation plan proposed by the soil and water conservation 
district, and with subsequent reports a statement of whether the 
conservation plan was implemented. 
     The report of a corporation seeking to qualify hereunder as 
a family farm corporation, an authorized farm corporation, a 
family farm partnership, or authorized farm partnership shall 
contain the following additional information:  The number of 
shares or the partnership interests owned by persons residing on 
the farm or actively engaged in farming, or their relatives 
within the third degree of kindred according to the rules of the 
civil law or their spouses; the name, address and number of 
shares owned by each shareholder or partnership interests owned 
by each partner; and a statement as to percentage of gross 
receipts of the corporation derived from rent, royalties, 
dividends, interest and annuities.  No pension or investment 
fund, limited partnership, or corporation shall commence farming 
in this state until the commissioner of agriculture has 
inspected the report and certified that its proposed operations 
comply with the provisions of this section. 
     (b) Every pension or investment fund, limited partnership, 
or corporation as described in clause (a) shall, prior to April 
15 of each year, file with the commissioner of agriculture a 
report containing the information required in clause (a), based 
on its operations in the preceding calendar year and its status 
at the end of the year.  A pension or investment fund, limited 
partnership, or corporation that does not file the report by 
April 15 must pay a $500 civil penalty.  The penalty is a lien 
on the land being farmed under subdivision 3 until the penalty 
is paid.  
    (c) The commissioner or the commissioner's authorized 
representative may enter into a written agreement with a person 
required to file a report under this subdivision who, for good 
cause shown, has failed to make a timely filing.  An agreement 
must be construed as a "no contest" pleading and may encompass a 
reduction or waiver of the civil penalty for late filing.  The 
agreement is final and conclusive with respect to the civil 
penalty, except upon a showing of fraud or malfeasance or 
misrepresentation of a material fact.  The matter agreed upon in 
the agreement may not be reopened or modified by an officer, 
employee, or agent of the state.  The commissioner may enter 
into an agreement under this paragraph only once for each 
corporation or partnership.  
    (d) Failure to file a required report, or the willful 
filing of false information, shall constitute a gross 
misdemeanor. 
    Sec. 23.  Laws 1990, chapter 480, article 1, section 3, 
subdivision 14, is amended to read: 
    Subd. 14.  [VOTER REGISTRATION FORM.] The commissioner 
shall insert securely in the individual income tax return form 
or instruction booklet distributed for an odd-numbered year a 
voter registration form, returnable to the secretary of state.  
The form shall be designed according to rules adopted by the 
secretary of state.  This requirement applies to forms and 
booklets supplied to post offices, banks, and other outlets, as 
well as to those mailed directly to taxpayers. 
    Sec. 24.  [SALE OF TAX-FORFEITED LAND; OTTER TAIL COUNTY.] 
    (a) Notwithstanding Minnesota Statutes, section 282.018, 
Otter Tail county may sell the tax-forfeited lands bordering 
public water and described in paragraph (c), under the remaining 
provisions of Minnesota Statutes, chapter 282. 
    (b) The conveyance must be in a form approved by the 
attorney general. 
    (c) The lands that may be conveyed are located in Otter 
Tail county and are described as: 
    (1) Lot 13, Sylvanus Crest, Clitherall Township; 
    (2) Lot 14, Sylvanus Crest, Clitherall Township; 
    (3) Government Lot 8, Section 32, Township 133, Range 43; 
    (4) A .36 acre tract of land in Government Ten (10) of 
Section Four (4), Township One Hundred Thirty-four (134) North, 
Range Thirty-nine (39) West of the 5th P.M., described as 
follows:  Beginning at a point (iron stake) located as follows:  
Commencing at the northwest corner (iron) of Lot Seventy-one 
(71) of "Pleasure Park Beach" subdivision, plat of which is on 
file and of record in the office of Register of Deeds of Otter 
Tail County, Minn.; thence proceeding South sixty-six degrees 
ten minutes West (S 66 degrees 10'W) one hundred thirty-two and 
five tenths (132.5) feet and South sixty-six degrees forty-one 
minutes West (S 66 degrees 41'W) one hundred fifty (150.0) feet 
to the point of beginning; thence running by the following four 
courses and distances, viz:  South twenty-four degrees fourteen 
minutes East (S 24 degrees 14'E) one hundred ninety-nine and six 
tenths (199.6) feet to an iron stake on the shoreline of Otter 
Tail Lake; South fifty-five degrees nineteen minutes West (S 55 
degrees 19'W) seventy-five (75.0) feet along the shoreline of 
said lake, to an iron stake; North twenty-four degrees 
thirty-four minutes West (N 24 degrees 34'W) two hundred 
fourteen and four tenths (214.4) feet to an iron stake; and 
North sixty-six degrees forty-one minutes East (N 66 degrees 
41'E) seventy-five (75.0) feet to the point of beginning; 
    (5) All of Lot 1, Except North 10 feet, Quiram's Beach, 
Star Lake Township; 
    (6) Lot 1, Silent Acres, Dora Township. 
    (d) The county has determined that these lands have little 
or no potential use as a public access or for other types of 
public ownership and will realize a higher and better use under 
private ownership. 
    Sec. 25.  [CANCELLATION OF HAYLIFT PROGRAM DEBTS.] 
    Any remaining balance on a department of agriculture 
account receivable resulting from operation of the 1989 drought 
emergency farm haylift program which the department is required 
to collect is canceled on the effective date of this section. 
    Sec. 26.  [115A.923] [Subd. 1a.] [PAYMENT OF THE GREATER 
MINNESOTA LANDFILL CLEANUP FEE.] 
    The operator of a disposal facility in greater Minnesota 
shall pay the fee required under Minnesota Statutes, section 
115A.923, subdivision 1, to the county or sanitary district 
where the facility is located, except that the operator of a 
facility that is owned by a statutory or home rule city shall 
pay the fee to the city that owns the facility.  The county, 
city, or sanitary district may use the revenue from the fee only 
for the purposes specified in section 115A.919. 
    Sec. 27.  [APPROPRIATION TO STEARNS COUNTY FOR KIDNAPPING 
INVESTIGATION COST.] 
    $100,000 is appropriated from the general fund to the 
commissioner of public safety for a grant to Stearns county for 
the investigation of criminal activity connected with a 
kidnapping. 
    Sec. 28.  [METRODOME ATHLETIC EVENTS.] 
    $500,000 is appropriated to the commissioner of trade and 
economic development to provide part of the state's contribution 
for the state to host the International Special Olympics in 1991 
and the world championship football game sponsored by the 
national football league in 1992.  $250,000 is for each event 
for fiscal year 1991.  Metrodome facilities must be provided to 
both events at no charge.  This appropriation does not cancel 
and is available through fiscal year 1992. 
    Sec. 29.  [DEPARTMENT OF REVENUE APPROPRIATION.] 
    There is appropriated from the general fund to the 
commissioner of revenue the following amounts for the 
administration of this act.  
Total                   Fiscal year 1990     Fiscal year 1991 
$400,000                     $125,000            $275,000 
Summary by purpose 
Tax incidence study                              $ 50,000 
Corporate AMT                                    $105,000 
Taxpayer bill of rights      $125,000            $ 25,000 
Tax increment financing                          $ 45,000 
Renters' credit                                  $ 50,000 
    The appropriation for administration of the taxpayer bill 
of rights for fiscal year 1990 is available until June 30, 1991. 
    Sec. 30.  [APPROVED COMPLEMENT.] 
    The approved complement of the department of revenue is 
increased by three for fiscal year 1991.  
    Sec. 31.  [BUDGET RESERVE REDUCED.] 
    Upon adjournment sine die of the 1990 legislature, the 
commissioner of finance, with the approval of the governor, 
shall reduce the amount in the budget and cash flow reserve 
account established in Minnesota Statutes, section 16A.15, 
subdivision 6, as needed to balance general fund expenditures 
with revenues for the biennium ending June 30, 1991.  
Notwithstanding section 16A.15, subdivision 1, paragraph (a), 
the commissioner need not consult with the legislative advisory 
commission before making the reduction. 
    Sec. 32.  [REPEALER.] 
    (a) Minnesota Statutes 1988, sections 115A.09, subdivision 
5; 325E.045, subdivisions 3 and 4; Minnesota Statutes 1989 
Supplement, sections 115A.922; 115A.923, subdivisions 2, 3, 4, 
and 5; 115A.924; 115A.925; 115A.927; and 115A.928 are repealed. 
    Laws 1987, chapter 348, section 51, subdivision 5, is 
repealed. 
    (b) Section 2 is repealed.  
    Sec. 33.  [EFFECTIVE DATE.] 
   Section 11 is effective for assessments or other 
determinations made on or after August 1, 1990.  Sections 12 and 
13 are effective for purchases after December 31, 1990.  
Sections 14, 24, and 25 are effective the day following final 
enactment.  Sections 15 and 16 are effective for taxable years 
beginning after June 30, 1990.  Section 17 is effective for 
taxable years beginning after December 31, 1990.  Section 22 is 
effective the day following final enactment, but the provision 
allowing for an agreement concerning reduction or waiver of a 
civil penalty for late filing applies to a filing due April 15, 
1989, or thereafter.  Section 32, paragraph (b), is effective 
July 1, 1992. 
    Presented to the governor April 28, 1990 
    Signed by the governor May 7, 1990, 10:06 a.m.

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